Document And Entity Information
Document And Entity Information - shares | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Document and entity information | |||
Document Type | 20-F | ||
Document Registration Statement | false | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2023 | ||
Document Transition Report | false | ||
Document Shell Company Report | false | ||
Entity File Number | 001-33910 | ||
Entity Registrant Name | ATA Creativity Global | ||
Entity Incorporation, State or Country Code | E9 | ||
Entity Address, Address Line One | c/o Rm.507, Bldg. 3, BinhuZhuoyueCheng, | ||
Entity Address, Address Line Two | WenhuaKechuangYuan, Huayuan Blvd. 365, | ||
Entity Address, Address Line Three | Baohe | ||
Entity Address, City or Town | Hefei, Anhui | ||
Entity Address, Postal Zip Code | 230051 | ||
Entity Address, Country | CN | ||
Title of 12(b) Security | American Depositary Shares, each representingtwo common shares, par value $0.01 per share | ||
Trading Symbol | AACG | ||
Security Exchange Name | NASDAQ | ||
Entity Common Stock, Shares Outstanding | 64,000,260 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | false | ||
Document Financial Statement Error Correction [Flag] | false | ||
Document Accounting Standard | U.S. GAAP | ||
Entity Shell Company | false | ||
Entity Central Index Key | 0001420529 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2023 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Auditor Firm ID | 3487 | 1186 | 1186 |
Auditor Name | Audit Alliance LLP | KPMG Huazhen LLP | KPMG Huazhen LLP |
Auditor Location | Singapore, Singapore | Beijing, China | Beijing, China |
Business Contact | |||
Document and entity information | |||
Contact Personnel Name | Ruobai Sima | ||
Entity Address, Address Line One | c/o 1/F East Gate, Building No. 2, Jian Wai Soho | ||
Entity Address, Address Line Two | No. 39 Dong San Huan Zhong Road | ||
Entity Address, Address Line Three | Chao Yang District | ||
Entity Address, City or Town | Beijing | ||
Entity Address, Postal Zip Code | 100022 | ||
Entity Address, Country | CN | ||
Country Region | 86 | ||
City Area Code | 10 | ||
Local Phone Number | 6518-1133 | ||
Contact Personnel Fax Number | 8610-5869-8106 |
Consolidated Balance Sheets
Consolidated Balance Sheets | Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) |
Current assets: | |||
Cash and cash equivalents | ¥ 60,167,232 | $ 8,474,377 | ¥ 54,980,199 |
Accounts receivable, net | 2,235,490 | 314,862 | 5,852,038 |
Prepaid expenses and other current assets | 8,042,169 | 1,132,716 | 4,430,285 |
Total current assets | 70,444,891 | 9,921,955 | 65,262,522 |
Long-term investments | 38,000,000 | 5,352,188 | 38,000,000 |
Property and equipment, net | 30,235,985 | 4,258,649 | 32,760,976 |
Intangible assets, net | 58,886,111 | 8,293,935 | 76,119,444 |
Goodwill | 196,289,492 | 27,646,797 | 196,289,492 |
Other non-current assets | 31,691,417 | 4,463,643 | 28,415,794 |
Right-of-use assets | 23,391,247 | 3,294,588 | 37,616,541 |
Total assets | 448,939,143 | 63,231,755 | 474,464,769 |
Current liabilities: | |||
Accrued expenses and other payables (including accrued expenses and other payables of the consolidated VIE without recourse to the Company of RMB134,604 and RMB60,587 as of December 31, 2022 and 2023, respectively) | 49,146,103 | 6,922,083 | 55,904,510 |
Lease liabilities-current | 13,110,449 | 1,846,568 | 16,920,429 |
Deferred revenues | 252,145,949 | 35,514,014 | 219,717,574 |
Total current liabilities | 314,402,501 | 44,282,665 | 292,542,513 |
Lease liabilities-non-current | 9,496,422 | 1,337,543 | 19,528,763 |
Deferred income tax liabilities | 12,066,513 | 1,699,533 | 18,879,303 |
Total liabilities | 335,965,436 | 47,319,741 | 330,950,579 |
Shareholders' equity: | |||
Common shares: Par value USD 0.01, authorized: 500,000,000 shares Issued: 63,829,698 and 64,514,368 shares as of December 31, 2022 and 2023, respectively Outstanding: 62,753,840 and 62,893,960 shares as of December 31, 2022 and 2023, respectively | 4,730,128 | 666,225 | 4,720,147 |
Treasury shares-585,358 common shares as of December 31, 2022 and 2023, at cost | (8,201,046) | (1,155,093) | (8,626,894) |
Additional paid-in capital | 545,222,465 | 76,792,978 | 542,058,092 |
Accumulated other comprehensive loss | (37,004,507) | (5,211,976) | (37,003,085) |
Accumulated deficit | (391,709,172) | (55,171,083) | (358,048,927) |
Total shareholders' equity attributable to ATA Creativity Global | 113,037,868 | 15,921,051 | 143,099,333 |
Non-controlling interests | (64,161) | (9,037) | 414,857 |
Total shareholders' equity | 112,973,707 | 15,912,014 | 143,514,190 |
Commitments and contingencies | |||
Total liabilities and shareholders' equity | ¥ 448,939,143 | $ 63,231,755 | ¥ 474,464,769 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) | Dec. 31, 2023 CNY (¥) shares | Dec. 31, 2023 USD ($) $ / shares shares | Dec. 31, 2022 CNY (¥) shares | Dec. 31, 2022 $ / shares |
Accrued expenses and other payables | ¥ 49,146,103 | $ 6,922,083 | ¥ 55,904,510 | |
Common shares, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | ||
Common shares, authorized | 500,000,000 | 500,000,000 | 500,000,000 | |
Common shares, issued | 64,514,368 | 64,514,368 | 63,829,698 | |
Common shares, outstanding | 62,893,960 | 62,893,960 | 62,753,840 | |
Treasury shares, common shares | 585,358 | 585,358 | 585,358 | |
Consolidated VIE | Nonrecourse | ||||
Accrued expenses and other payables | ¥ | ¥ 60,587 | ¥ 134,604 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) ¥ / shares | Dec. 31, 2023 USD ($) $ / shares | Dec. 31, 2022 CNY (¥) ¥ / shares | Dec. 31, 2021 CNY (¥) ¥ / shares | |
Consolidated Statements of Comprehensive Income (Loss) | ||||
Net revenues | ¥ 221,618,968 | $ 31,214,379 | ¥ 206,820,874 | ¥ 202,209,465 |
Cost of revenues | 106,961,759 | 15,065,249 | 104,315,856 | 97,413,915 |
Gross profit | 114,657,209 | 16,149,130 | 102,505,018 | 104,795,550 |
Operating expenses: | ||||
Research and development | 4,629,880 | 652,105 | 6,790,791 | 11,801,545 |
Sales and marketing | 78,737,492 | 11,089,944 | 75,265,726 | 66,149,460 |
General and administrative | 72,816,606 | 10,256,004 | 77,051,580 | 93,256,046 |
Total operating expenses | 156,183,978 | 21,998,053 | 159,108,097 | 171,207,051 |
Other operating income, net | 30,865 | 4,347 | 16,515 | 22,018 |
Loss from operations | (41,495,904) | (5,844,576) | (56,586,564) | (66,389,483) |
Other income (loss): | ||||
Gain on deconsolidation of subsidiaries and others, net | 1,308,627 | 33,542,154 | ||
Impairment loss of long-term investments | (6,000,000) | |||
Interest income, net of interest expenses | 978,530 | 137,823 | 756,886 | 1,110,681 |
Foreign currency exchange gains (losses), net | (4,876) | (687) | 5,436 | (213,046) |
Total other income, net | 973,654 | 137,136 | 2,070,949 | 28,439,789 |
Loss before income taxes | (40,522,250) | (5,707,440) | (54,515,615) | (37,949,694) |
Income tax benefit | (6,811,709) | (959,409) | (5,921,384) | (1,539,577) |
Net loss | (33,710,541) | (4,748,031) | (48,594,231) | (36,410,117) |
Net loss attributable to redeemable non-controlling interests | (714,121) | |||
Net loss attributable to non-redeemable non-controlling interests | (50,296) | (7,084) | (701,322) | (2,046,403) |
Net loss attributable to ATA Creativity Global | (33,660,245) | (4,740,947) | (47,892,909) | (33,649,593) |
Other comprehensive income (loss): | ||||
Foreign currency translation adjustment, net of nil income tax | (1,422) | (200) | 556,762 | (135,125) |
Total other comprehensive income (loss) | (1,422) | (200) | 556,762 | (135,125) |
Comprehensive loss | (33,711,963) | (4,748,231) | (48,037,469) | (36,545,242) |
Comprehensive loss attributable to redeemable non-controlling interests | (714,121) | |||
Comprehensive loss attributable to non-redeemable non-controlling interests | (50,296) | (7,084) | (701,322) | (2,046,403) |
Comprehensive loss attributable to ATA Creativity Global | ¥ (33,661,667) | $ (4,741,147) | ¥ (47,336,147) | ¥ (33,784,718) |
Basic losses per common share attributable to ATA Creativity Global | (per share) | ¥ (0.54) | $ (0.08) | ¥ (0.76) | ¥ (0.57) |
Diluted losses per common share attributable to ATA Creativity Global | (per share) | ¥ (0.54) | $ (0.08) | ¥ (0.76) | ¥ (0.57) |
Consolidated Statements of Chan
Consolidated Statements of Changes in Equity | Total shareholders' equity attributable to ATA Creativity Global CNY (¥) | Total shareholders' equity attributable to ATA Creativity Global USD ($) | Common shares CNY (¥) shares | Common shares USD ($) shares | Treasury Shares CNY (¥) | Treasury Shares USD ($) | Additional paid-in capital CNY (¥) | Additional paid-in capital USD ($) | Accumulated other comprehensive loss CNY (¥) | Accumulated other comprehensive loss USD ($) | Accumulated deficit CNY (¥) | Accumulated deficit USD ($) | Non-redeemable non-controlling interests CNY (¥) | Non-redeemable non-controlling interests USD ($) | CNY (¥) shares | USD ($) shares |
Balance at Dec. 31, 2020 | ¥ 198,404,863 | ¥ 4,716,675 | ¥ (11,625,924) | ¥ 541,272,503 | ¥ (37,424,722) | ¥ (298,533,669) | ¥ 843,001 | ¥ 199,247,864 | ||||||||
Balance (in shares) at Dec. 31, 2020 | shares | 62,701,002 | 62,701,002 | ||||||||||||||
Increase (Decrease) in Stockholders' Equity | ||||||||||||||||
Net loss | (33,649,593) | (33,649,593) | (2,046,403) | (35,695,996) | ||||||||||||
Foreign currency translation adjustment, net of nil income tax | (135,125) | (135,125) | (135,125) | |||||||||||||
Share-based compensation | 1,039,972 | 1,039,972 | 1,039,972 | |||||||||||||
Payments of individual income tax in connection with shares directly withheld from employees | (114,729) | ¥ 3,472 | (118,201) | (114,729) | ||||||||||||
Payments of individual income tax in connection with shares directly withheld from employees (in shares) | shares | 52,838 | 52,838 | ||||||||||||||
Cash collected upon exercise of share options | 232,245 | 232,245 | 232,245 | |||||||||||||
Redeemable non-controlling interests redemption value accretion | (2,283,089) | (2,283,089) | (2,283,089) | |||||||||||||
Acquisition of non-redeemable non-controlling interests | (35,785) | (35,785) | (89,215) | (125,000) | ||||||||||||
Disposal of subsidiaries | 24,310,333 | 24,310,333 | 4,423,059 | 28,733,392 | ||||||||||||
Settlement of vested share options and vested shares using treasury shares | 1,807,170 | (1,807,170) | ||||||||||||||
Balance at Dec. 31, 2021 | 187,769,092 | ¥ 4,720,147 | (9,818,754) | 540,583,564 | (37,559,847) | (310,156,018) | 3,130,442 | 190,899,534 | ||||||||
Balance (in shares) at Dec. 31, 2021 | shares | 62,753,840 | 62,753,840 | ||||||||||||||
Increase (Decrease) in Stockholders' Equity | ||||||||||||||||
Net loss | (47,892,909) | (47,892,909) | (701,322) | (48,594,231) | ||||||||||||
Foreign currency translation adjustment, net of nil income tax | 556,762 | 556,762 | 556,762 | |||||||||||||
Share-based compensation | 1,459,755 | 1,459,755 | 1,459,755 | |||||||||||||
Payments of individual income tax in connection with shares directly withheld from employees | (30,731) | (30,731) | (30,731) | |||||||||||||
Cash collected upon exercise of share options | 218,943 | 218,943 | 218,943 | |||||||||||||
Acquisition of non-redeemable non-controlling interests | 1,018,421 | 1,018,421 | (1,418,421) | (400,000) | ||||||||||||
Disposal of subsidiaries | (595,842) | (595,842) | ||||||||||||||
Settlement of vested share options and vested shares using treasury shares | 1,191,860 | (1,191,860) | ||||||||||||||
Balance at Dec. 31, 2022 | 143,099,333 | ¥ 4,720,147 | (8,626,894) | 542,058,092 | (37,003,085) | (358,048,927) | 414,857 | ¥ 143,514,190 | ||||||||
Balance (in shares) at Dec. 31, 2022 | shares | 62,753,840 | 62,753,840 | 62,753,840 | 62,753,840 | ||||||||||||
Increase (Decrease) in Stockholders' Equity | ||||||||||||||||
Net loss | (33,660,245) | (33,660,245) | (50,296) | ¥ (33,710,541) | ||||||||||||
Foreign currency translation adjustment, net of nil income tax | (1,422) | (1,422) | (1,422) | $ (200) | ||||||||||||
Share-based compensation | 3,068,041 | 3,068,041 | 3,068,041 | |||||||||||||
Payments of individual income tax in connection with shares directly withheld from employees | (68,326) | ¥ 9,981 | (78,307) | (68,326) | ||||||||||||
Payments of individual income tax in connection with shares directly withheld from employees (in shares) | shares | 140,120 | 140,120 | ||||||||||||||
Cash collected upon exercise of share options | 471,765 | 471,765 | 471,765 | |||||||||||||
Acquisition of non-redeemable non-controlling interests | 128,722 | 128,722 | (428,722) | (300,000) | ||||||||||||
Settlement of vested share options and vested shares using treasury shares | 425,848 | (425,848) | ||||||||||||||
Balance at Dec. 31, 2023 | ¥ 113,037,868 | $ 15,921,051 | ¥ 4,730,128 | $ 666,225 | ¥ (8,201,046) | $ (1,155,093) | ¥ 545,222,465 | $ 76,792,978 | ¥ (37,004,507) | $ (5,211,976) | ¥ (391,709,172) | $ (55,171,083) | ¥ (64,161) | $ (9,037) | ¥ 112,973,707 | $ 15,912,014 |
Balance (in shares) at Dec. 31, 2023 | shares | 62,893,960 | 62,893,960 | 62,893,960 | 62,893,960 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | |
Cash flows from operating activities: | ||||
Net loss | ¥ (33,710,541) | $ (4,748,031) | ¥ (48,594,231) | ¥ (36,410,117) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||||
Depreciation and amortization | 21,984,382 | 3,096,435 | 22,590,666 | 23,025,480 |
Loss (gain) from disposal of property and equipment | 893 | 126 | (1,692) | 24,380 |
Share-based compensation | 3,068,041 | 432,125 | 1,459,755 | 1,039,972 |
Deferred income tax benefit | (6,812,790) | (959,561) | (6,052,019) | (1,562,358) |
Gain on deconsolidation of subsidiaries and others, net | (1,308,627) | (33,542,154) | ||
Impairment loss of long-term investments | 6,000,000 | |||
Gain from acquisition of a subsidiary | (4,018) | (566) | ||
Foreign currency exchange loss | 7 | 1 | 323 | 213,741 |
Changes in operating assets and liabilities, net of effect of acquisition and disposal: | ||||
Accounts receivable | 3,616,548 | 509,380 | (4,913,849) | 1,245,142 |
Prepaid expenses and other current assets | (2,386,561) | (336,140) | (5,711,215) | 675,236 |
Other non-current assets | (3,275,623) | (461,362) | (1,833,631) | (3,788,762) |
Income tax payable | (13,753) | (1,937) | (7,947) | (85,707) |
Accrued expenses and other payables | (7,139,011) | (1,005,509) | 10,884,454 | 4,532,885 |
Deferred revenues | 33,423,899 | 4,707,658 | 18,874,126 | 6,798,577 |
Net cash provided by (used in) operating activities | 8,751,473 | 1,232,619 | (14,613,887) | (31,833,685) |
Cash flows from investing activities: | ||||
Cash paid for property and equipment | (2,240,101) | (315,512) | (1,618,338) | (4,451,589) |
Cash receipt from property and equipment disposal | 14,850 | 2,092 | 6,010 | 22,490 |
Cash paid for liabilities assumed in relation to acquisition of Youru (Note 3) | (1,023,859) | (144,208) | (312,338) | |
Payment for acquisition of a subsidiary, less cash acquired | (417,376) | (58,786) | (4,642,082) | |
Proceeds from deconsolidation of subsidiaries and others, less cash disposed | (165,437) | (832,811) | ||
Cash paid for acquisition of non-redeemable non-controlling interests | (300,000) | (42,254) | (400,000) | (125,000) |
Net cash used in investing activities | (3,966,486) | (558,668) | (2,490,103) | (10,028,992) |
Cash flows from financing activities: | ||||
Cash paid for employee individual income tax for net- settlement of vested shares | (68,326) | (9,624) | (30,731) | (114,729) |
Cash received from short-term loans (Note 10) | 2,710,000 | |||
Repayment of short-term loans (Note 10) | (2,000,000) | |||
Cash received for exercise of share options | 471,765 | 66,447 | 218,943 | 232,245 |
Net cash provided by financing activities | 403,439 | 56,823 | 188,212 | 827,516 |
Effect of foreign exchange rate changes on cash and cash equivalents | (1,393) | (196) | 556,616 | (348,911) |
Net increase (decrease) in cash and cash equivalents | 5,187,033 | 730,578 | (16,359,162) | (41,384,072) |
Cash and cash equivalents at beginning of year | 54,980,199 | 7,743,799 | 71,339,361 | 112,723,433 |
Cash and cash equivalents at end of year | 60,167,232 | 8,474,377 | 54,980,199 | 71,339,361 |
Supplemental disclosures of cash flow information: | ||||
Cash paid for income tax | 20,427 | 2,877 | 28,316 | 154,379 |
Cash refunded for income tax | (211) | (30) | (5,316) | |
Cash paid for interest expenses | 25,278 | |||
Non-cash investing and financing activities: | ||||
Consideration payable for acquisition of Youru (Note 3) | 198,333 | 27,935 | 1,222,191 | |
Disposal of net liabilities of subsidiaries, excluding cash | 5,378,395 | 13,041,021 | ||
Lease liability arising from obtaining Right-of-use assets | ¥ 1,709,583 | $ 240,790 | ¥ 14,628,975 | ¥ 16,132,735 |
DESCRIPTION OF BUSINESS, ORGANI
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | 12 Months Ended |
Dec. 31, 2023 | |
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | |
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | (1) DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS Description of Business and Organization ATA Creativity Global (the “Company” or “ACG”, formerly known as ATA Inc.), through its subsidiaries, variable interest entity (“VIE”) and VIE’s subsidiary (collectively referred to as the “Group”), offers a range of educational services consisting primarily of portfolio training service, research-based learning service, overseas study counselling service and other educational services primarily to individual students in person or online mainly through its training centers in the People’s Republic of China. VIE Agreements PRC regulations prohibit direct foreign ownership of business entities that engage in internet content provision (“ICP’’) services in the PRC. The Company and its subsidiaries are foreign owned business entities under the PRC law and accordingly are restricted from providing ICP services in the PRC, including having more than 50% ownership of entities engaged in providing such services. ATA Intelligent Learning (Beijing) Technology Limited (“ATA Intelligent Learning” or “VIE”) is engaged to provide, but not limited to, ICP services, such as providing online trainings and platforms in PRC. The Company has no legal ownership interest in ATA Intelligent Learning. The legal ownership interests of ATA Intelligent Learning are 90% owned by Mr. Xiaofeng Ma, the chairman of the board and chief executive officer of the Company, and 10% owned by Mr. Haichang Xiong, general counsel of the Company prior to August 12, 2020 and by Mr. Jun Zhang, president and director of the Company effective from August 12, 2020. Mr. Ma, Mr. Xiong and Mr. Zhang are PRC citizens. All individuals are nominee shareholders of ATA Intelligent Learning and holding their equity interests on behalf of the Company. Through a series of contractual agreements, including loan agreements, a call option and cooperation agreement, an equity interest pledge agreement, an exclusive technical consulting and services agreement and a power of attorney (collectively, the “VIE Agreements”) among ATA Education Technology (Beijing) Limited (“ATA Education”), ATA Intelligent Learning, and their nominee shareholders, the nominee shareholders of ATA Intelligent Learning have granted all their legal rights including voting rights and disposition rights of their equity interests in ATA Intelligent Learning to ATA Education. The nominee shareholders of ATA Intelligent Learning do not participate significantly in income and loss and do not have the power to direct the activities of ATA Intelligent Learning that most significantly impact its economic performance. Accordingly, ATA Intelligent Learning is considered a variable interest entity. The Company entered into the VIE Agreements to preserve the flexibility to operate, invest in or hold businesses that are restricted from receiving foreign investments. Although the Company does not have an equity investment in ATA Intelligent Learning, the Company has other variable interests in ATA Intelligent Learning through its wholly-owned subsidiary, ATA Education, including (i)ATA Education’s subordinated loans to Mr. Xiaofeng Ma, Mr. Haichang Xiong and Mr. Jun Zhang (used by them to finance their equity investment in ATA Intelligent Learning) and other subordinated loans to ATA Intelligent Learning, (ii) ATA Education’s right, under the loan agreement, to receive all the dividends declared by ATA Intelligent Learning through its nominee shareholders, (iii) ATA Education’s exclusive purchase option, under the call option and cooperation agreement, to acquire (or to have ATA Education’s designee acquire) 100% of the equity interest or assets in ATA Intelligent Learning for a consideration equal to the loans provided by ATA Education to Mr. Xiaofeng Ma, Mr. Haichang Xiong and Mr. Jun Zhang, to the extent permitted under PRC law and (iv) ATA Education, under the call option and cooperation agreement, is obligated to provide financial support to ATA Intelligent Learning’s operation to which ATA Education has no recourse right if ATA Intelligent Learning cannot repay such financing due to its losses. In accordance with Accounting Standards Codification (“ASC”) 810-10-25-38A, the Company has a controlling financial interest in ATA Intelligent Learning through its wholly-owned subsidiary, ATA Education, because the Company (i) has the power to direct activities of ATA Intelligent Learning that most significantly impact the economic performance of ATA Intelligent Learning; and (ii) the obligation to absorb the losses and the right to receive benefits of ATA Intelligent Learning that could potentially be significant to ATA Intelligent Learning. Thus, the Company is the primary beneficiary of ATA Intelligent Learning. Accordingly, the financial statements of ATA Intelligent Learning are consolidated in the Company’s consolidated financial statements. Under the terms of the VIE Agreements, ATA Intelligent Learning’s nominee shareholders have no rights to the net assets nor have the obligations to fund the deficit, and such rights and obligations have been vested to the Company. All of the equity (net assets) and net incomes or losses of ATA Intelligent Learning are attributed to the Company. The key terms of these VIE Agreements are as follows: Loan agreements: ATA Education lent to ATA Intelligent Learning’s nominee shareholders, Mr. Xiaofeng Ma and Mr. Haichang Xiong, interest free loans in the amount of RMB 10.0 million, out of which RMB 1.0 million and RMB 9.0 million were stipulated to lend on March 15, 2018 and December 28, 2018, respectively, for the sole purpose of investing in ATA Intelligent Learning as ATA Intelligent Learning’s registered capital. The nominee shareholders of ATA Intelligent Learning can only repay the loans by transferring all of their legal ownership interest in ATA Intelligent Learning to ATA Education or to a party designated by ATA Education. The nominee shareholders of ATA Intelligent Learning are required to pay to ATA Education all dividends received from ATA Intelligent Learning. In the event that the nominee shareholders of ATA Intelligent Learning transfer their equity interests to the ATA Education or its designee at a price equivalent to or less than the principal amount of the loans, the loans will be interest free. If the price is higher than the principal amount of the loan, the excess amount will be paid to ATA Education as loan interest. The initial terms of the loans are ten years, which may be extended upon the written agreement of ATA Education and ATA Intelligent Learning’s nominee shareholders. The approval of ATA Intelligent Learning is not required for the renewal of the loan agreements nor can ATA Intelligent Learning terminate the loan agreement during the contract term. On March 19, 2019 and April 20, 2019, ATA Education, ATA Intelligent Learning and each of the nominee equity shareholders of ATA Intelligent Learning entered into two supplementary agreements to the VIE agreements, pursuant to which the aggregate amount of loans made by ATA Education to the nominee shareholders of ATA Intelligent Learning for the capitalization of ATA Intelligent Learning was increased from RMB 10.0 million to RMB 50.0 million with all other terms and conditions under the VIE Agreements remain unchanged. According to the supplementary agreements, ATA Education lent additional RMB 40.0 million to the nominee shareholders in 2019 for the sole purpose of investing in ATA Intelligent Learning as ATA Intelligent Learning’s registered capital. On August 12, 2020, the loan agreement entered by Mr. Haichang Xiong with ATA Education, and the rights and obligations of Mr. Haichang Xiong under the two supplementary agreements terminated as a result of the equity interest in ATA Intelligent Learning transferred by Mr. Haichang Xiong to Mr. Jun Zhang, and Mr. Haichang Xiong repaid his borrowing of RMB 5.0 million under such agreements to ATA Education on August 17, 2020. On August 12, 2020, Mr. Jun Zhang, as the new shareholder of ATA Intelligent Learning, entered into a new loan agreement with ATA Education on the same terms as the loan agreement and the two supplementary agreements previously entered by Mr. Haichang Xiong and borrowed RMB 5.0 million from ATA Education on August 17, 2020 pursuant to aforementioned loan agreement. Exclusive technical consulting and services agreement: ATA Education has the sole and exclusive right to provide specified technical and consulting services to ATA Intelligent Learning. The Parties agree that the intellectual property rights created by ATA Education in the course of performing this agreement, including without limitation any copyrights, trademarks or logos registered or not, patents and proprietary technology, shall belong to ATA Education. The consulting fee payable by ATA Intelligent Learning to ATA Education shall be confirmed by ATA Education in writing and be calculated based on the actual time spent by ATA Education in providing services to ATA Intelligent Learning on a quarterly basis. The consulting fee shall be settled on a quarterly basis, and at the end of each year, ATA Education shall confirm the total consulting and other fees incurred for the year in writing and ATA Intelligent Learning shall settle any outstanding fees on a timely basis. This agreement was entered in on March 15, 2018 and shall continue for a period of 30 years and shall be automatically extended for another 10 years unless ATA Education gives written notice terminating this agreement 3 months before the expiration. Call option and cooperation agreement: Pursuant to the call option and cooperation agreement entered into among ATA Education, ATA Intelligent Learning and its nominee shareholders, when permitted by applicable laws, ATA Education (or any eligible party designated by ATA Education) shall have the right to acquire, at any time, all of ATA Intelligent Learning’s assets or its share equity owned by the nominee shareholders of ATA Intelligent Learning, at a price equal to the sum of the principal amounts of the loans from ATA Education to the nominee shareholders of ATA Intelligent Learning. If ATA Education elects to purchase a portion of ATA Intelligent Learning’s share equity or assets, the exercise price for such purpose shall be adjusted accordingly based on the percentage of such share equity or assets to be purchased relative to the total share equity or assets. Without the prior written consent of ATA Education, ATA Intelligent Learning may not sell or otherwise dispose its assets or beneficial interests, create or allow any encumbrance on its assets or other beneficial interests, enter into any material contracts (except those contracts entered into in the ordinary course of business), or distribute dividends to the nominee shareholders. ATA Education is also obligated to provide financial support to ATA Intelligent Learning’s operation to which ATA Education has no recourse right if ATA Intelligent Learning cannot repay such financing due to its losses. This agreement shall be effective upon the execution date and remain effective thereafter. This agreement can only be terminated with the unanimous consent of all parties, except that ATA Education may terminate this agreement with 30 days prior notice to the other parties. Equity interest pledge agreement: To secure the payment obligations of ATA Intelligent Learning, ATA Intelligent Learning’s nominee shareholders have pledged to ATA Education their entire equity ownership interests in ATA Intelligent Learning to guarantee his and ATA Intelligent Learning’s performance of obligations under, where applicable, the exclusive technical consulting and services agreement and the call option and cooperation agreement. If ATA Intelligent Learning or the nominee shareholders of ATA Intelligent Learning breach their contractual obligations under these agreements, ATA Education, as pledgee, will have the right to acquire the pledged equity interests. The nominee shareholders of ATA Intelligent Learning agree that, during the term of the equity interest pledge agreements, they will not dispose the pledged equity interests or create or allow any encumbrance on the pledged equity interests, and they also agree that ATA Education’s rights relating to the equity pledge shall not be suspended or hampered by the nominee shareholders, their successors or their designates. During the term of the equity interest pledge agreements, ATA Education has the right to receive all of the dividends and profits distributed on the pledged equity. The term of the equity interest pledge agreement shall commence on March 15, 2018 and shall expire on the earlier of (a) the date on which all outstanding secured obligations are paid in full or otherwise satisfied (as applicable); (b) ATA Education enforces the equity interest pledge agreement pursuant to the terms and conditions, to satisfy its rights under the secured obligations and pledged collateral in full, or (c) the nominee shareholders of ATA Intelligent Learning complete their transfer of the equity interest to another party (individual or legal entity) pursuant to the Call Option and Cooperation Agreement and no longer holds any equity interest in ATA Intelligent Learning. ATA Intelligent Learning has registered these equity interest pledge agreements with the competent State Administration for Market Regulation (SAMR, previously known as State Administration for Industry and Commerce, or SAIC) on April 27, 2018. The registration of the equity pledge enables ATA Education to enforce the equity pledge against third parties who acquire the equity interests of ATA Intelligent Learning in good faith. According to the equity transfer agreement entered into by Mr. Haichang Xiong and Mr. Jun Zhang, on August 12, 2020, Mr. Haichang Xiong transferred all his equity interest in ATA Intelligent Learning to Mr. Jun Zhang, as well as his obligations and rights under the equity interest pledge agreement entered into by himself. On the same day, Mr. Jun Zhang, as the new shareholder of ATA Intelligent Learning, entered into a new equity interest pledge agreement with ATA Education and ATA Intelligent Learning on the same terms as the equity pledge agreement previously entered by Mr. Haichang Xiong. The term of the equity interest pledge agreements entered by Mr. Jun Zhang shall commence on the date of August 12, 2020 and shall expire on the earlier of the Expiration Conditions. ATA Intelligent Learning has registered the equity interest pledge agreement entered by Mr. Jun Zhang with SAMR, on February 26, 2021. Power of attorney: Pursuant to the irrevocable powers of attorney, each of the nominee shareholders of ATA Intelligent Learning, who signed the power of attorney on March 15, 2018, appointed ATA Education or any eligible person designated by ATA Education as his attorney-in-fact to exercise all voting rights and other nominee shareholders rights of ATA Intelligent Learning, including but not limited to appointing or electing on their directors and executive officers. The person designated by ATA Education is entitled to sign the transfer documents necessary for the fulfilment of the exclusive technical consulting and services agreement and the call option and cooperation agreement, and to join the liquidation group and participate in the liquidation of ATA Intelligent Learning. The term of the powers of attorney shall be consistent with the term of the equity interest pledge agreements and call option and cooperation agreement and shall be extended along with the equity interest pledge agreements and call option and cooperation agreement. The Company relies on the VIE Agreements to operate and control ATA Intelligent Learning. However, these contractual arrangements may not be as effective as direct equity ownership in providing the Company with control over ATA Intelligent Learning. Any failure by ATA Intelligent Learning or its nominee shareholders to perform their obligations under the VIE Agreements would have a material adverse effect on the financial position and financial performance of the Company. All the VIE Agreements are governed by PRC law and provide for the resolution of disputes through arbitration in the PRC. Accordingly, these contracts would be interpreted in accordance with PRC law and any disputes would be resolved in accordance with PRC legal procedures. The legal system in the PRC is not as developed as some other jurisdictions, such as the United States. As a result, uncertainties in the PRC legal system could limit the Company’s ability to enforce these contractual arrangements. In addition, if the legal structure and the VIE Agreements were found to be in violation of any existing or future PRC laws and regulations, the Company may be subject to fines or other legal or administrative sanctions. In the opinion of management, based on the legal opinion of Jincheng Tongda & Neal Law Firm, the Company’s PRC legal counsel, the above contractual arrangements are legally binding and enforceable and do not violate current PRC laws and regulations. However, there are uncertainties regarding the interpretation and application of existing and future PRC laws and regulations. The Company cannot assure that the PRC regulatory authorities will not ultimately take a contrary view to its opinion. If the current ownership structure of the Company and the contractual arrangements with ATA Intelligent Learning are found to be in violation of any existing or future PRC laws and regulations, the PRC government could: · · · · · · · · If the imposition of any of these government actions, or any inability to enforce the contractual arrangements upon a breach, causes the Company to lose its ability to direct the activities of ATA Intelligent Learning or receive substantially all the economic benefits and residual returns from ATA Intelligent Learning and the Company is not able to restructure its ownership structure and operations in a satisfactory manner, the Company would no longer be able to consolidate the financial results of ATA Intelligent Learning in the Company’s consolidated financial statements. Total assets, total liabilities, equity, revenues, net income and cash flows of the Company would be significantly less than the reported amount in the consolidated financial statements of the Company. In the opinion of management, the likelihood of deconsolidation of ATA Intelligent Learning is remote based on current facts and circumstances. The equity interests of ATA Intelligent Learning are legally held by Mr. Ma, Mr. Xiong and Mr. Zhang as nominee shareholders on behalf of ACG. Mr. Ma is chairman of the board and director of ACG, Mr. Xiong was general counsel of ACG and Mr. Zhang is president and director of ACG. Mr. Ma holds approximately 40% of the total ordinary shares of the Company issued and outstanding as of December 31, 2022 and 2023. The Company cannot assure that when conflicts of interest arise, either the nominee shareholders will act in the best interests of the Company or such conflicts will be resolved in the Company’s favour. Currently, the Company does not have any arrangements to address potential conflicts of interest between the nominee shareholders and the Company, except that ATA Education could exercise the purchase option under the exclusive option agreement with the nominee shareholders to request them to transfer all of their equity ownership in ATA Intelligent Learning to a PRC entity or individual designated by ATA Education. The Company relies on the nominee shareholders, who are ACG’s director and general counsel, who owe fiduciary duties to ACG, to comply with the terms and conditions of the contractual arrangements. Such fiduciary duty requires the nominee shareholders to act in good faith and in the best interests of ACG and not to use their positions for personal gains. If the Company cannot resolve any conflict of interest or dispute between the Company and the nominee shareholders of ATA Intelligent Learning, the Company would have to rely on legal proceedings, which could result in disruption of the Company’s business and subject the Company to substantial uncertainty as to the outcome of any such legal proceedings. The nominee shareholder of ATA Intelligent Learning was changed from Mr. Haichang Xiong to Mr. Jun Zhang on August 12, 2020. There are no substantive changes on terms of the VIE agreements. ATA Intelligent Learning holds 70% equity interests of Beijing Zhenwu Technology Development Co., Ltd., or Beijing Zhenwu, a PRC company newly established in August 2021. Beijing Zhenwu was mainly engaged in conducting some of the Group’s short-term project-based art learning services and terminated its business since early 2022. The Company’s involvement with ATA Intelligent Learning and its subsidiary, or the consolidated VIE, under the VIE Agreements affected the Company’s consolidated financial position, results of operations and cash flows as presented below. The following assets and liabilities information of the Group’s consolidated VIE as of December 31, 2022 and 2023, and net revenues, net loss and cash flows for the years ended December 31, 2021, 2022 and 2023, were included in the accompanying consolidated financial statements of the Company. December 31, December 31, 2022 2023 RMB RMB Cash 159,882 257,218 Prepaid expenses and other current assets 6,592 6,592 Total current assets 166,474 263,810 Long-term investments (i) 55,779,696 49,003,096 Other non-current assets 2,590 12,590 Total assets 55,948,760 49,279,496 Accrued expenses and other payables 134,604 60,587 Amounts due to related parties (ii) 63,597,353 64,617,353 Total current liabilities 63,731,957 64,677,940 Total liabilities 63,731,957 64,677,940 Year ended December 31, 2021 2022 2023 RMB RMB RMB Net revenues — — — Net loss (14,072,212) (7,824,115) (7,615,247) Year ended December 31, 2021 2022 2023 RMB RMB RMB Net cash used in operating activities (903,343) (861,350) (952,664) Net cash used in investing activities (4,642,082) — — Net cash provided by financing activities (iii) 5,645,353 830,186 1,050,000 (i) Long-term investments as of December 31, 2022 and 2023 include investment cost and share of losses derived from the 30.96 % equity interests investment in Beijing Huanqiuyimeng Education Consultation Corp. (“Huanqiuyimeng”) in the amount of RMB55,779,696 and RMB49,003,096, respectively, which is eliminated on consolidation. (ii) Amounts due to related parties represent the amounts due to the Company’s subsidiaries, which are eliminated on consolidation. (iii) RMB5,645,353, RMB830,186 and RMB1,050,000 of net cash provided by financing activities for the years ended December 31, 2021, 2022 and 2023 respectively were related to the transactions with the Company’s subsidiaries, which are eliminated on consolidation. In accordance with the VIE Agreements, the Company has the power to direct the activities of the consolidated VIE and can have assets transferred out of the consolidated VIE. Therefore, the Company considers that there are no assets in the consolidated VIE that can be used only to settle obligations of the consolidated VIE, except for the registered capital amounting RMB 50.0 million as of December 31, 2023. None of the assets of the consolidated VIE has been pledged or collateralized. The creditors of the consolidated VIE do not have recourse to the general credit of ATA Education or the Company. Significant Concentrations and Risks The Group is subject to the following significant concentration and risks: Concentration of cash and cash equivalents balances held at financial institutions Cash and cash equivalents consist of cash on hand and cash at bank. Cash at bank are deposited in financial institutions at below locations: December 31, December 31, 2022 2023 RMB RMB Financial institutions in the mainland of the PRC — Denominated in Renminbi (“RMB”) 47,841,321 50,134,377 — Denominated in U.S. Dollar (“USD”) 145 147 Total cash balances held at mainland PRC financial institutions 47,841,466 50,134,524 Financial institutions in Hong Kong Special Administrative Region (“HKSAR”) of the PRC — Denominated in Hong Kong Dollar (“HKD”) 2,714 798 — Denominated in USD 7,136,019 10,031,910 Total cash and cash equivalents balances held at HKSAR financial institutions 7,138,733 10,032,708 Total cash and cash equivalents balances held at financial institutions 54,980,199 60,167,232 The bank deposits with financial institutions in the PRC are insured by the government authority up to RMB500,000. The bank deposits with financial institutions in the HKSAR are insured by the government authority up to HKD500,000. To limit exposure to credit risk, the Company primarily places bank deposits with large financial institutions in the PRC and HKSAR with acceptable credit rating. Coronavirus Impact Due to the outbreak and global spreading of the Coronavirus (“COVID-19”) since January 2020, the Group’s sales have been negatively impacted primarily due to the restrictions on international travels and temporary closures of training centers for safety and regulatory considerations for the years from 2020 to 2022.Such impact was progressively mitigated after the COVID-19 pandemic was gradually under control in the years of 2021 and 2022. In addition, the Company’s traditional overseas educational travel services were materially affected by delays and cancellations of tours due to COVID-19 in the years of 2021 and 2022. In late 2022, the Chinese government relaxed COVID-19 control policies and business of the Group gradually returned to normal, providing most of the courses offline. The Company is closely monitoring the development of the COVID-19 pandemic and continuously evaluating any further potential impact on its business, results of operations and financial condition, which the Company believes will not as material as prior years and ultimately depend on the duration and degree of the pandemic around China and the globe. Geographic concentration A substantial portion of the Company’s net revenues were generated from educational services in China. The regulatory regime for educational services industry in China continues to rapidly evolve and the relevant laws, regulations or interpretations may change in the future. Any changes that adversely affect the Company’s business in China will have a material adverse effect on the Company’s financial condition and results of operations. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | (2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (a) Principles of consolidation The consolidated financial statements include the financial statements of the Company and its subsidiaries, in which ACG, directly or indirectly, has a controlling financial interest and its variable interest entity and its subsidiary, or the consolidated VIE for which the Company is the primary beneficiary. All significant intercompany balances and transactions have been eliminated upon consolidation. Non-redeemable non-controlling interests are separately presented as a component of equity in the consolidated financial statements. (b) Basis of presentation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). (c) Use of estimates The preparation of financial statements in conformity with U.S. GAAP requires management of the Group to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Such estimates include the fair value determinations of identifiable assets acquired and liabilities assumed, the fair values of share-based payments and other equity investments, the collectability of loan receivable and other receivables, the realizability of deferred income tax assets, the estimate for useful lives and residual values of long-lived assets, the recoverability of long-lived assets, goodwill and long-term investments, determination of estimated stand-alone selling prices of performance obligations, variable consideration and measurement of progress towards completion in revenue recognition. Actual results could differ from those estimates. The current economic environment has increased the degree of uncertainty inherent in those estimates and assumptions. (d) Foreign currency The accompanying consolidated financial statements have been expressed in RMB, the Company’s reporting currency. The Company, ATA Testing Authority (Holdings) Limited (“ATA BVI”), ATA Creativity Global (Hong Kong) Limited (“ACG HK”) (formerly known as Xing Wei Institute (Hong Kong) Limited (“Xing Wei”) and ACG International Group Limited (“ACGIGL”)’s functional currency is USD. The functional currency of the Company’s PRC subsidiaries, VIE and VIE’s subsidiary is RMB. 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 foreign currencies are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting foreign exchange gains and losses are included in the consolidated statements of comprehensive income (loss) in the line item “ Foreign currency exchange gains (losses), net Assets and liabilities of the Company, ATA BVI, ACG HK and ACGIGL are translated into RMB using the applicable exchange rate at each balance sheet date. Revenues and expenses are translated into RMB at average rates prevailing during the year. Equity accounts other than retained earnings (accumulated deficit) generated in the current period are translated into RMB using the appropriate historical rates. The resulting foreign currency translation adjustments are recognized as a separate component of accumulated other comprehensive income (loss) within equity. Since RMB is not a fully convertible currency, all foreign exchange transactions involving RMB must take place either through the People’s Bank of China (the “PBOC”) or other institutions authorized to buy and sell foreign exchange. The exchange rates adopted for the foreign exchange transactions are the rates of exchange quoted by the PBOC. For the convenience of the readers, the 2023 RMB amounts included in the accompanying consolidated financial statements have been translated into USD at the rate of USD 1.00 = RMB 7.0999, the noon buying rate in New York cable transfers of RMB per USD as set forth in the H.10 weekly statistical release of Federal Reserve Board, as of December 31, 2023. No representation is made that the RMB amounts could have been, or could be, converted into USD at that rate or at any other rate on December 31, 2023. (e) Commitments and contingencies In the normal course of business, the Group is subject to contingencies, such as legal proceedings and claims that cover a wide range of matters. Liabilities for such contingencies are recorded when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated. If a potential material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material, is disclosed. (f) Fair value measurements The Group utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible. The Group determines fair value based on assumptions that market participants would use in pricing an asset or liability in an orderly transaction and principal or most advantageous market. When considering market participant assumptions in fair value measurements, the following fair value hierarchy distinguishes between observable and unobservable inputs, which are categorized in one of the following levels: · · · The level in the fair value hierarchy within which a fair value measurement in its entirety falls is based on the lowest level input that is significant to the fair value measurement in its entirety. In situations where there is little, if any, market activity for the asset or liability at the measurement date, the fair value measurement reflects management’s own judgments about the assumptions that market participants would use in pricing the asset or liability. Those judgments are developed by management based on the best information available in the circumstances. (g) Revenue recognition The Group’s revenue is primarily generated from portfolio training services, research-based learning services, overseas study counselling services and other educational services through its training centers in China. Revenue is recognized net of Value Added Tax (“VAT”). VAT collected from customers, net of VAT paid for purchases, is recorded as a liability in the consolidated balance sheets until paid to the tax authorities. The Group recognizes revenues upon the satisfaction of its performance obligation (upon transfer of control of promised goods or services to customers) in an amount that reflects the consideration to which the Group expects to be entitled to in exchange for those goods or services, excluding amounts collected on behalf of third parties (for example, value added taxes). The transaction price includes variable consideration where the Company’s performance may result in full or partial return of the service fees based on the final outcome of the performance targets. The Company estimates the transaction price at contract inception based on expected value method, which the Company believes to be better predict with the amount of consideration to which it will be entitled in the contract. In making the estimate of variable consideration, the Company applies judgments which are inherently subjective. This includes the assessment of the final outcome of the performance targets and its historical experience and performance. The amount of estimated variable consideration included in the transaction price is limited only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable condition is subsequently resolved. Management reviews these estimates on a regular basis. Any changes in these factors which affect the estimated variable consideration and revenue recognized are applied prospectively. For each performance obligation satisfied over time, the Group recognizes revenue over time by measuring the progress toward complete satisfaction of that performance obligation. If the Group does not satisfy a performance obligation over time, the performance obligation is satisfied at a point in time. The Group’s contracts with customers also include promises to transfer multiple services. For these contracts, the Group accounts for individual performance obligations separately if they are capable of being distinct and distinct within the context of the contract. Determining whether products and services are distinct performance obligations may require significant judgment. Judgment is also required to determine the stand-alone selling price (“SSP”) for each distinct performance obligation. In instances where SSP is not directly observable, such as when the Group does not sell the product or service separately, the Group determines the SSP using information that may include market conditions and other observable inputs. For these contracts with variable consideration, the Group determines that variable consideration is allocated according to the method as described above, because variable consideration is attributable to all of the performance obligations in a contract. i) Portfolio training services Portfolio training services primarily consist of one-on-one or small-group training at the training centers or online platform in which the teachers provide guidance to students to practice observational drawing or other forms of art work and finally compile the selected pieces to form a portfolio. Individual students select to enroll either in time-based program in which they can take a pre-determined number of hours of training or in a project-based program in which they are guided to complete a portfolio that usually consists of three to five art projects. Revenue is recognized over a period of time based on the number of training hours expended and total hours of training under the contract with the student since the individual student simultaneously receives and consumes the benefits of the portfolio training services as the Group performs. Under project-based programs, the number of hours of training required to complete a project is not pre-determined and varies depending on the background and requirements of individual student. The Group reassesses the total hours of training pursuant to each contract of project-based program with individual student on a quarterly basis. Any adjustments arising from the changes of estimated training hours are applied prospectively. ii) Research-based learning services (formerly known as the educational travel services) The Group provides educational travel services for individual students to bring them art-related experience by providing integration of both travel and study activities in each educational service contract according to the background of individual students. While the educational travel services have been significantly impacted by the coronavirus disease (“COVID-19”), starting in year 2020, the Group introduced new services under the “research-based learning services”, which mainly consist of domestic educational travel services, academic educational learning services, workshop experience services and transferrable credit courses. Revenue is recognized when control of the promised services is transferred to customers in an amount of consideration which the Group expects to be entitled to in exchange for those services. iii) Overseas study counselling services The Group provides overseas study counselling services to students who intend to study abroad on the following aspects, including but not limited to, customized timetable for applicants, university and program selection, developing paperwork for applications, interview simulation and enrollment documents preparation. The Group provides integration and customization of the promised services in each overseas study counselling service contract depending on the background and requirements of the students and aims to deliver a combined output for counselling service to cover both academic and practical aspects during the entire process of application. The promised services are highly interdependent and interrelated and are accounted as one performance obligation, as the promised services in a contract are not distinct within the context of the contract. Since the students simultaneously receive and consume the benefits of these services throughout the service period as the Group performs, the Group recognizes revenue over the counselling service period on the basis of costs incurred to-date to the total estimated costs. iv) Other educational services Other educational services mainly consist of language training services, junior art education services and in-school classes The Group recognizes revenues from the other educational services proportionately when the services are delivered. v) K-12 education assessment and other services The Group derives revenues by providing the assessment reports for the test takers to customers. Revenues from education assessment services are recognized when the Group delivers the reports to customers, which is when the control over the report has been transferred to customers. Fees received in advance are recorded as deferred revenue when the Group has an obligation to transfer goods or services to a customer for which the Group has received consideration. The Group derives content development revenue by designing test model and providing the developed content to customers. Revenues from content development are recognized when the Group delivers the developed content to customers, which is when the control over the content has been transferred to customers. Revenues under this category were mainly contributed by the legacy business from our prior subsidiary of Muhua Shangce Learning Data & Technology (Beijing) Limited (“Muhua Shangce”), whose equity interests was fully disposed on June 2, 2021 in order to focus on our core business of international education. See Note 14. (h) Contract cost Sales commissions to sales personnel and third-party agents, and incentives to existing students for referred customers are accounted for as incremental cost of obtaining sales contracts from customers and are initially recognized as an amortizable asset in other non-current assets. Contract cost assets are amortized on the basis consistent with the pattern of the transfer of services to which the assets relate and are included in “sales and marketing expenses” in the consolidated statements of comprehensive income (loss). The amortization expenses of contract cost assets were RMB14,244,301 , RMB 18,470,625, and RMB 22,080,933 for the years ended December 31, 2021, 2022 and 2023, respectively. (i) Cost of revenues Cost of revenues primarily consist of (1) teaching fees, payroll compensation for teaching support and administrative staff from the training centers, performance-linked bonuses paid to teachers, rental payments for training centers, as well as costs of course materials and teaching aids for portfolio training services, (2) payroll compensation, outsourcing service costs, lodging and transportation expenses, overseas expenses, and other related costs which are directly attributable to the provision of research-based learning services and overseas study counselling services, and (3) teaching fees, payroll compensation, content development costs, and other related costs, which are directly attributable to the rendering of other educational services and K-12 education assessment and other services. (j) Research and development costs Research and development costs primarily consist of salaries and benefits for the Group’s research and development personnel, outsourcing services costs and other costs relating to the design, development, testing and enhancement of the technology systems in support for the rendering of the Group’s products and services. Research and development costs are expensed as incurred. Research and development cost incurred over software developed was primarily for internal use and treated as follows. The Group expenses all costs that are incurred in connection with the planning and implementation phases of the development of software. Costs incurred in the development phase are capitalized and amortized over the estimated product life. No costs were capitalized for any of the periods presented. (k) Lease The Group is a lessee in a number of non-cancellable operating leases, primarily for training center and office spaces. The Group accounts for leases in accordance with ASC Topic 842, Leases For operating leases, the lease liability is initially and subsequently measured at the present value of the unpaid lease payments at the lease commencement date. Key estimates and judgments include how the Group determines (1) the discount rate it uses to discount the unpaid lease payments to present value, (2) lease term and (3) lease payments. · ASC 842 requires a lessee to discount its unpaid lease payments using the interest rate implicit in the lease or, if that rate cannot be readily determined, its incremental borrowing rate. Generally, the Group cannot determine the interest rate implicit in the lease because it does not have access to the lessor’s estimated residual value or the amount of the lessor’s deferred initial direct costs. Therefore, the Group generally uses its incremental borrowing rate as the discount rate for the lease. The Group’s incremental borrowing rate for a lease is the rate of interest it would have to pay on a collateralized basis to borrow an amount equal to the lease payments under similar terms. Because the Group does not generally borrow on a collateralized basis, it uses the interest rate it pays on its non-collateralized borrowings as an input to deriving an appropriate incremental borrowing rate, adjusted for the amount of the lease payments, the lease term and the effect on that rate of designating specific collateral with a value equal to the unpaid lease payments for that lease. · Lease payments included in the measurement of the lease liability are comprised of fixed payments, including in-substance fixed payments, owed over the lease term, which includes termination. The ROU asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for lease payments made at or before the lease commencement date, plus any initial direct costs incurred less any lease incentives received. The leases entered into within the Group do not incur initial direct costs or lease incentives. For operating leases, the ROU asset is subsequently measured throughout the lease term at the carrying amount of the lease liability, plus unamortized initial direct costs, plus (minus) any prepaid (accrued) lease payments, less the unamortized balance of lease incentives received. Lease cost is recognized on a straight-line basis over the lease term. Variable lease payments associated with the Group’s leases are recognized when the event, activity, or circumstance in the lease agreement on which those payments are assessed occurs. Variable lease payments are presented as operating expense in the Group’s consolidated statements of comprehensive income (loss) in the same line item as expense arising from fixed lease payments for operating leases. ROU assets for operating lease are periodically reduced by impairment losses. The Group uses the long-lived assets impairment guidance in ASC Subtopic 360-10, Property, Plant, and Equipment – Overall The Group monitors for events or changes in circumstances that require reassessment of its leases. When a reassessment results in the re-measurement of a lease liability, a corresponding adjustment is made to the carrying amount of the corresponding ROU asset unless doing so would reduce the carrying amount of the ROU asset to an amount less than zero. In that case, the amount of the adjustment that would result in a negative ROU asset balance is recorded in profit or loss. Operating lease ROU assets are presented as operating lease right of use assets on the consolidated balance sheet. The current portion of operating lease liabilities is included in lease liabilities-current and the long-term portion is presented separately as lease liabilities-non-current on the consolidated balance sheets. The Group has elected not to recognize ROU assets and lease liabilities for short-term leases of training centers and offices that have a lease term of 12 months or less. The Group recognizes the lease payments associated with its short-term training centers and offices leases as an expense on a straight-line basis over the lease term. As of December 31, 2022 and 2023, the Company did not have any finance leases. (l) Income taxes Income taxes are accounted for under the asset and liability method. Under this method, deferred income tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and tax loss carry forwards. Deferred income 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 income tax assets and liabilities of a change in tax rates or tax status is recognized in income in the period that includes the enactment date or the date of change in tax status. A valuation allowance is provided to reduce the amount of deferred income tax assets if it is considered more likely than not that some portion or all of the deferred income tax assets will not be realized. A deferred tax liability is not recognized for the excess of the Company’s financial statement carrying amount over the tax basis of its investment in a foreign subsidiary, if there exists specific plans for reinvestment of undistributed earnings of a subsidiary which demonstrates that remittance of the earnings will be postponed indefinitely. The Group recognizes in the consolidated financial statements the impact of a tax position, if that position is more likely than not of being sustained upon examination, based on the technical merits of the position. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Group’s accounting policy is to accrue interest and penalties related to unrecognized tax benefits, if and when required, as interest expense and a component of general and administrative expenses, respectively in the consolidated statements of comprehensive income (loss). (m) Share-based payment The Group measures the cost of employee share options and non-vested shares based on the grant date fair value of the award and recognizes that cost over the period during which an employee is required to provide services in exchange for the award, which generally is the vesting period. For the graded vesting share options and non-vested shares, the Company recognizes the compensation cost over the requisite service period for each separately vesting portion of the award as if the award is, in substance, multiple awards. When no future services are required to be performed by the employee in exchange for an award of equity instruments, and if such award does not contain a performance or market condition, the cost of the award is expensed on the grant date. Awards granted to employees with performance conditions are measured at fair value on the grant date and are recognized as compensation expenses in the period and thereafter when the performance goal becomes probable to achieve. We elect to recognize the effect of forfeitures as compensation cost when they occur. To the extent the required vesting conditions are not met which leads to the forfeiture of the share-based awards, previously recognized compensation expenses relating to such awards will be reversed. When there is a modification of the terms and conditions of an award of equity instruments, the Group calculates the incremental compensation cost of a modification as the excess of the fair value of the modified award over the fair value of the original award immediately before its terms are modified, measured based on the share price and other pertinent factors at the modification date. For vested options, the Group recognizes incremental compensation cost in the period the modification occurred. For unvested options, the Group recognizes, over the remaining requisite service period, the sum of the incremental compensation cost and the remaining unrecognized compensation cost for the original award on the modification date. Cancellations in the vesting period are treated as an acceleration of vesting, and recognized immediately for the amount that would otherwise be recognized for services over the vesting period. When there is a change in the grantee status from an employee to a non-employee, if grantee retains the awards on a change in status and continues to provide substantive services to the Group, the change in status results in a new measurement date for the unvested awards with compensation costs measured as if the awards were newly issued to the grantee on the date of the change in status. If grantee retains the awards on a change in status and is not required to provide substantive services to the grantor subsequent to that change in status, the change in status is, in substance, an acceleration of the vesting of the arrangement. (n) Cash and cash equivalents Cash and cash equivalents consist of cash on hand, cash in banks and highly liquid investments with original maturity less than three months and readily convertible to known amount of cash. (o) Accounts receivable Accounts receivable are recognized at invoiced amounts, less an allowance for uncollectible accounts, if any. In connection with the adoption of ASC 326 Financial Instruments-Credit Losses (p) Long-term investments Equity method investments The Group applies the equity method to account for an equity interest in an investee over which the Group has significant influence but does not own a majority equity interest or otherwise control. Under the equity method of accounting, the Group’s share of the investee’s results of operations is reported as investment income (loss) in the consolidated statements of comprehensive income (loss). The Group recognizes an impairment loss when there is a decline in value below the carrying value of the equity method investment that is considered to be other than temporary. The process of assessing and determining whether impairment on an investment is other than temporary requires a significant amount of judgment. To determine whether an impairment is other than temporary, management considers whether it has the ability and intent to hold the investment until recovery and whether evidence indicating the carrying value of the investment is recoverable outweighs evidence to the contrary. Evidence considered in this assessment includes the reasons for the impairment, the severity and duration of the decline in value, any change in value subsequent to the period end, and forecasted performance of the investee. Other equity investments In connection with the adoption of ASC321 Investment—Equity Securities The Group makes a qualitative assessment considering impairment indicators to evaluate whether the equity investments without a readily determinable fair value is impaired at each reporting period, and write down to its fair value if a qualitative assessment indicates that the investment is impaired and the fair value of the investment is less than its carrying value. If an equity security without a readily determinable fair value is impaired, the Group includes an impairment loss in net income equal to the difference between the fair value of the investment and its carrying amount. (q) Property and equipment, net Property and equipment is stated at historical cost. Depreciation is recognized over the following useful lives in straight-line method, taking into consideration the assets’ estimated salvage value: Building 30 years Computer equipment 3 to 5 years Furniture, fixtures and office equipment 3 to 5 years Software 3 to 10 years Motor vehicles 5 years Leasehold improvements The shorter of lease terms and estimated useful lives Ordinary maintenance and repairs are charged to expenses as incurred, while replacements and betterments are capitalized. When items are retired or otherwise disposed of, income is charged or credited for the difference between net book value of the item disposed and proceeds realized thereon. (r) Intangible assets Intangible assets mainly consist of externally acquired intangible assets resulting from the acquisitions of entities and accounted for using the acquisition method of accounting, which are estimated by management based on the fair value of assets acquired at the acquisition date. Intangible assets are amortized on a straight-line basis over their respective estimated useful lives, which range from 1 to 10 years. The Group has no intangible assets with indefinite useful lives. (s) Impairment of long-lived assets, excluding goodwill Long-lived assets, including property and equipment, intangible assets, other non-current assets subject to amortization and right-of-use assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require a long-lived asset or asset group be tested for possible impairment, the Group first compares undiscounted cash flows expected to be generated by that asset or asset group to its carrying value. If the carrying value of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent that the carrying value exceeds its fair value. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. (t) Goodwill In connection with the adoption of ASU 2017-04, Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (u) Employee benefit plans As stipulated by the regulations of the PRC, the Company’s PRC subsidiaries are required to contribute to various defined contribution plans, organized by municipal and provincial governments on behalf of their employees. The contributions to these plans are based on certain percentages of the employee’s standard salary base as determined by the local Social Security Bureau. The Group has no other obligation for the payment of employee benefits associated with these plans beyond the annual contributions described above. Employee benefit expenses recognized under these plans for the years ended December 31, 2021, 2022 and 2023 are allocated to the following expense items. Year Ended December 31, 2021 2022 2023 RMB RMB RMB Cost of revenues 5,989,994 6,780,226 7,161,205 Research and development 1,294,439 316,293 294,859 Sales and marketing 3,775,110 4,199,996 4,033,438 General and administrative 3,810,984 3,742,289 3,405,996 Total expense due to employee benefit plans 14,870,527 15,038,804 14,895,498 (v) Earnings (losses) per share Basic earnings (losses) per share is computed by dividing net income (losses), considering the accretions to redemption value of the redeemable non-controlling interests, by the weighted average number of common shares outstanding during the year using the two-class method. Under the two-class method, any net income (losses) is allocated between common shares and other participating securities based on their participating rights in undistributed earnings (losses). Net losses are not allocated to participating securities when the participating securities does not have contractual obligation to share losses. The Company’s certain non-vested shares relating to the share-based awards under the share incentive plan were considered participating securities since the holders of these securities have non-forfeitable rights to dividends |
BUSINESS ACQUISITION
BUSINESS ACQUISITION | 12 Months Ended |
Dec. 31, 2023 | |
BUSINESS ACQUISITION | |
BUSINESS ACQUISITION | (3) BUSINESS ACQUISITION In September, 2022, the Group entered into an agreement with Youru (Shanghai) Education Technology Co., Ltd. and its subsidiaries (“Youru”) to acquire the business of portfolio training and relevant consulting on fashion design through the transfer of the workforce, trademark and public domain. The Group was obligated to deliver the remaining performance obligations of Youru’s existing contracts with the students and assume the potential refund of the service fees. The acquisition was considered as immaterial. The Group recognized a goodwill with an amount of RMB1,534,529, which was assigned to the reporting unit of overseas art study services. In 2023, we completed the acquisition of 100% equity interests of Jinan City Shizhong District Nuobi Education Training School Co., Ltd. (Jinan Nuobi). The equity interest was transferred from Jun Zhang, the President and Director of the Company, and a consideration of RMB 0.5 million was paid in August, 2023. |
PREPAID EXPENSES AND OTHER CURR
PREPAID EXPENSES AND OTHER CURRENT ASSETS | 12 Months Ended |
Dec. 31, 2023 | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | (4) PREPAID EXPENSES AND OTHER CURRENT ASSETS Prepaid expenses and other current assets consist of the following: December 31, December 31, 2022 2023 RMB RMB VAT-input deductible 565,675 609,416 Income tax refundable 15,488 15,467 Amount due from Beijing Shouyiren (i) — 1,638,583 Prepaid marketing fee 657,764 751,836 Advances to suppliers 761,613 1,932,090 Other current assets 2,429,745 3,094,777 Total prepaid expenses and other current assets 4,430,285 8,042,169 Other current assets primarily consist of rent deposits and prepaid rent expenses. (i) |
LONG-TERM INVESTMENTS
LONG-TERM INVESTMENTS | 12 Months Ended |
Dec. 31, 2023 | |
LONG-TERM INVESTMENTS | |
LONG-TERM INVESTMENTS | (5) LONG-TERM INVESTMENTS December 31, December 31, 2022 2023 RMB RMB EEO Group 38,000,000 38,000,000 Total other equity investments 38,000,000 38,000,000 The Group accounts for its equity investments that do not have readily determinable fair value in accordance with ASC321 Investment—Equity Securities Prior to January 1, 2019, the Group acquired 7.95% equity interests of ApplySquare Education & Technology Co., Ltd (“ApplySquare”) in exchange for USD 3,000,000 (equivalent to RMB 19,721,700) in cash. As of January 1, 2019, the carrying amount of the investment in ApplySquare was RMB 22,471,700 . As of December 31, 2019, ACG made a qualitative assessment and identified that Applysquare failed to meet the expected milestones and operation forecasts and encountered shortage of working capital resulted from continuous negative operating cash flows, which indicated that impairment existed. With the assistance of an independent appraiser, the Company evaluated the fair value of the investment in Applysquare as of December 31, 2019 and recorded an impairment loss of RMB 20,895,309 based on the valuation result. Due to the severe shortage of working capital and negative market impact on its business in the year ended December 31, 2020, the Group recognized an impairment loss of RMB 1,576,391 to reduce the investment to zero. Prior to January 1, 2019, the Group acquired 20% equity interests of Beijing Xiaozhi Education Technology Co., Ltd. (“Xiaozhi”) in exchange for RMB 6,000,000 in cash. According to the shares purchase agreement, ACG has the right to appoint one director. The Company paid RMB 6,000,000 in cash to Xiaozhi in January 2019. The investment is not in-substance common stock due to the liquidation preference feature. During the year ended December 31, 2021, ACG made a qualitative assessment and identified that Xiaozhi failed to meet the expected milestones and operation forecasts and encountered shortage of working capital resulted from continuous negative operating cash flows, which indicated that impairment existed. The Group recognized an impairment loss of RMB 6,000,000 to reduce the investment to zero. Long-term investment in Beijing Futou Technology Co., Ltd (“Futou Technology”) was acquired in connection with the acquisition of Huanqiuyimeng in 2019, which held 15% equity interests in Futou Technology. Due to the severe shortage of working capital and negative market impact on its business in the year ended December 31, 2020, the Group recognized an impairment loss of RMB 150,000 to reduce the investment to zero. Prior to January 1, 2019, the Group acquired 8.33% equity interests of Beijing Empower Education Online Co., Ltd. (“EEO”) in exchange for RMB 38,000,000 in cash. In July 2020, EEO underwent an internal reorganization pursuant to which the Company exchanged its equity interest in EEO to EEO Group, a newly established holding company incorporated in Cayman Islands. The equity interests in EEO Group are substantially equivalent to the exchanged equity interests in EEO. EEO Group also entered into two rounds of financing agreements with certain new investors in July and November 2020, respectively. After the internal reorganization and new financings in 2020, ACG’s equity interest in EEO Group decreased from 8.33% to 4.822%. Since the securities issued during new financing arrangements are not identical or similar in terms of rights and obligations to the equity securities held by the Company, the Company did not adjust the carrying amount of the long-term investments in EEO Group. On March 30, 2021, EEO Group entered into a financing agreement with a group of new investors. After EEO Group’s new financing, ACG’s equity shares decreased from 4.822% to 4.433%. Since the securities issued during this new financing arrangements are not identical or similar in terms of rights and obligations to the equity securities held by the Company, the Company did not adjust the carrying amount of the long-term investments in EEO Group. Long-term investment in Beijing Quanouyimeng Culture Communication Co., Ltd. (“Quanouyimeng”), an entity that mainly delivers foreign language training services, was acquired in connection with the acquisition of Huanqiuyimeng in 2019, which held 100 % equity interests in Quanouyimeng. On June 10 , 2022, the Group entered into a loan agreement with Quanouyimeng and committed to provide an interest free loan up to RMB0.95 million to Quanouyimeng, pursuant to which, the Group paid RMB0.65 million before September 30, 2022 and the remaining RMB0.30 million in October 2022. On July 1, 2022, Huanqiuyimeng sold 70 % equity interests in Quanouyimeng to its management employee at nil consideration. As a result, the Group deconsolidated Quanouyimeng as of July 1, 2022 when the Company no longer has a controlling financial interest in Quanouyimeng, by removing its net liabilities, writing-off the receivables due from Quanouyimeng and recognizing a disposal gain of RMB682,996 according to ASC 810-10, with the remaining 30 % equity interests of Quanouyimeng remeasured at nil fair value. |
FAIR VALUE MEASUREMENT
FAIR VALUE MEASUREMENT | 12 Months Ended |
Dec. 31, 2023 | |
FAIR VALUE MEASUREMENT | |
FAIR VALUE MEASUREMENT | (6) FAIR VALUE MEASUREMENT The other equity investments without readily determinable fair value are recorded at fair value only if an impairment or observable price adjustment is recognized in the current period. If an impairment or observable price adjustment is recognized on the equity securities during the period, the Company will classify these assets as Level 3 within the fair value hierarchy based on the nature of the fair value inputs. To estimate the fair value of investment in Applysquare as of December 31, 2020, the Group used Discounted Cash Flow Model (“DCF Model”), which is based on the fair value of the entire invested capital of Applysquare using an income approach. The significant inputs for the valuation model were future cash flows, discount rate, and the comparable selection set of companies operating in similar businesses. The Group recorded an impairment loss of RMB 1,576,391 for the year ended December 31, 2020 to reduce the investment book value to zero. To estimate the fair value of investment in Futou Technology as of December 31, 2020, the Group used DCF Model, which is based on the fair value of the entire invested capital of Futou Technology using an income approach. The significant inputs for the valuation model include, but not limited to, future cash flows, discount rate, and the comparable selection set of companies operating in similar businesses. The Group recorded an impairment loss of RMB 150,000 for the year ended December 31, 2020 to reduce the investment book value to zero. To estimate the fair value of investment in Xiaozhi as of September 30, 2021, the Group used DCF Model, which is based on the fair value of the entire invested capital of Xiaozhi using an income approach. The significant inputs for the valuation model include, but not limited to, future cash flows, discount rate, and the comparable selection set of companies operating in similar businesses. The Group recorded impairment loss of RMB 6,000,000 for the year ended December 31, 2021 to reduce the investment book value to zero. To estimate the fair value of investment in Quanouyimeng as of July 1, 2022, the Group used DCF Model, which is based on the fair value of the entire invested capital of Quanouyimeng using an income approach. The significant inputs for the valuation model include, but not limited to, future cash flows, discount rate, and the comparable selection set of companies operating in similar businesses. The Group recorded a gain on disposal of equity interests in Quanouyimeng amounting to RMB 682,996 for the year ended December 31, 2022. The Group’s other financial instruments consist of cash and cash equivalents, accounts receivable, advances to third parties, employees and suppliers, which are included in the prepaid expenses and other current assets, loan receivable, net, accrued expenses and other payables and short-term loans, all of which have a carrying amount that approximate fair value because of the short maturity of these instruments. The Group did not have any non-financial assets and liabilities that are measured at fair value on a non-recurring basis as of December 31, 2022 and 2023, respectively. |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 12 Months Ended |
Dec. 31, 2023 | |
PROPERTY AND EQUIPMENT, NET | |
PROPERTY AND EQUIPMENT, NET | (7) PROPERTY AND EQUIPMENT, NET Property and equipment, net consist of the following: December 31, December 31, 2022 2023 RMB RMB Building (i) 53,049,213 53,049,213 Computer equipment 2,842,992 2,729,055 Furniture, fixtures and office equipment 1,620,039 1,686,997 Motor vehicles 1,469,021 1,469,021 Software 1,565,195 1,565,195 Leasehold improvements 8,476,176 5,564,110 69,022,636 66,063,591 Less: accumulated depreciation and amortization (36,261,660) (35,827,606) Property and equipment, net 32,760,976 30,235,985 (i) Huanqiuyimeng entered into a two-year Commercial Loan Facility (the “Facility”) with China Minsheng Bank Beijing Branch. The Facility is pledged by the real estate property owned by ATA Education, see Note 10 for details. Total depreciation expense recognized for the years ended December 31, 2021, 2022 and 2023 is allocated to the following expense items: Year ended December 31, 2021 2022 2023 RMB RMB RMB Cost of revenues 397,905 817,643 1,061,367 Research and development 448,414 22,084 26,669 Sales and marketing 7,984 9,674 15,231 General and administrative 4,937,844 4,267,932 3,647,782 Total depreciation expense 5,792,147 5,117,333 4,751,049 |
GOODWILL AND INTANGIBLE ASSETS,
GOODWILL AND INTANGIBLE ASSETS, NET | 12 Months Ended |
Dec. 31, 2023 | |
GOODWILL AND INTANGIBLE ASSETS, NET | |
GOODWILL AND INTANGIBLE ASSETS, NET | (8) GOODWILL AND INTANGIBLE ASSETS, NET (a) Goodwill ACG acquired 100% equity interests of Huanqiuyimeng and its subsidiaries in the year of 2019. This acquisition was accounted for under the acquisition method of accounting and the excess of fair values of the consideration and non-controlling interests over the fair value of the identifiable net assets of Huanqiuyimeng is recorded as goodwill of RMB 200,478,795. In May and August 2020, the Group disposed three campuses in relation to the junior art education service to third parties. A decrease in goodwill of RMB 5,723,832 allocated to these campuses within the junior art education service was recognized based on the relative fair values of the campuses being disposed of and the portion of the reporting unit retained. In July 2022, the Group disposed 70 % equity interests of Quanouyimeng in relation to majority of the foreign language training services to a third party, see Note 5 for details . Nil goodwill was allocated to the disposal group, of which the fair value is determined as nil. In September 2022, the Group entered into an agreement with Youru. This acquisition was accounted for under the acquisition method and the company recognized a goodwill amounting to RMB1,534,529 accordingly, see Note 3 for details. The change in the carrying amount of goodwill by reporting unit is as follows: Overseas art study Other Educational services Services Consolidate RMB RMB RMB Balance as of December 31, 2021 176,046,647 18,708,316 194,754,963 Add: Acquisition of Youru 1,534,529 — 1,534,529 Balance as of December 31, 2022 and 2023 177,581,176 18,708,316 196,289,492 The Company performs goodwill impairment testing on an annual basis and whenever events or changes in circumstances indicate that the carrying value of a reporting unit likely exceeds its fair value. This involves estimating the fair value of the reporting units using discounted cash flow models and the key assumptions used in the valuation models include forecasted revenue growth rates, forecasted operating margins and the discount rate. No impairment was identified and recorded for fiscal years ended December 31, 2021, 2022 and 2023. (b) Intangible assets The following table summarizes the Company’s intangible assets, as of December 31, 2022 and 2023. December 31, 2022 Weighted Gross Accumulated Net average carrying amortization carrying amortization amount /deduction Impairment amount period RMB RMB RMB RMB Years Trademark (i) 79,000,000 (26,991,667) — 52,008,333 10 Non-compete arrangements (i) 56,000,000 (31,888,889) — 24,111,111 6 Copyright obtained 240,000 (240,000) — — 1 Total intangible assets 135,240,000 (59,120,556) — 76,119,444 December 31, 2023 Weighted Gross Accumulated Net average carrying amortization carrying amortization amount /deduction Impairment amount period RMB RMB RMB RMB Years Trademark (i) 79,000,000 (34,891,667) — 44,108,333 10 Non-compete arrangements (i) 56,000,000 (41,222,222) — 14,777,778 6 Total intangible assets 135,000,000 (76,113,889) — 58,886,111 Total amortization expense recognized for the years ended December 31, 2021, 2022 and 2023 is allocated to the following expense items: Year ended December 31, 2021 2022 2023 RMB RMB RMB Cost of revenues — 240,000 — General and administrative 17,233,333 17,233,333 17,233,333 Total amortization expense 17,233,333 17,473,333 17,233,333 (ii) Trademark and Non-compete arrangements were recorded as a result of the acquisition of Huanqiuyimeng businesses. As of December 31, 2023, the estimated amortization expense for the next five years is as follows: December 31 RMB 2024 17,233,333 2025 13,344,444 2026 7,900,000 2027 7,900,000 2028 7,900,000 |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2023 | |
LEASES | |
LEASES | (9) LEASES The primary leases that the Group entered into were for training centers and office spaces. Certain leases include renewal options and/or termination options, which are factored into the Group’s determination of lease payments when appropriate. As of December 31, 2022, the Company has 29 operating leases for training center and office spaces with remaining terms expiring from 1 through 66 months and a weighted average remaining lease term of 2.79 years. Weighted average discount rates used in the calculation of the lease liability is 6.57%. As of December 31, 2023, the Company has 25 operating leases for training center and office spaces with remaining terms expiring from 1 through 54 months and a weighted average remaining lease term of 2.17 years. Weighted average discount rates used in the calculation of the lease liability is 6.56%. The discount rates reflect the estimated incremental borrowing rate, which includes an assessment of the credit rating to determine the rate that the Company would have to pay to borrow, on a collateralized basis for a similar term, an amount equal to the lease payments in a similar economic environment. Operating lease costs for the years ended December 31, 2021, 2022 and 2023 were RMB 21,599,937, RMB 18,456,989 and RMB 18,600,344, respectively, which excluded cost of short-term contracts. Short-term lease expense, with a lease term of 12 months or less, for the years ended December 31, 2021, 2022 and 2023 were RMB 3,248,285, RMB 3,412,129 and RMB 3,950,259, respectively. Short-term lease commitments as of December 31, 2023 was RMB 3,146,914. There were no variable lease costs or sublease income for leased assets for the years ended December 31, 2021, 2022 and 2023. The impact of ASC 842 on the consolidated balance sheets as of December 31, 2022 and 2023 was as follows: December 31, December 31, 2022 2023 RMB RMB Operating leases: Right-of-use assets 37,616,541 23,391,247 Lease liabilities-current 16,920,429 13,110,449 Lease liabilities-non-current 19,528,763 9,496,422 Other information related to leases is presented below: Year ended December 31, 2021 2022 2023 RMB RMB RMB Supplemental cash flow information: Cash paid for amounts included in measurement of operating leases liabilities 21,478,066 18,669,210 18,077,004 Lease liability arising from obtaining Right-of-use assets 16,132,735 14,628,975 1,709,583 Maturities of lease liabilities under non-cancellable leases as of December 31, 2023 are as follows: Operating leases RMB 2024 13,570,315 2025 8,297,577 2026 1,538,067 2027 707,828 2028 128,696 Thereafter — Total undiscounted lease payments 24,242,483 Less: Imputed interest (1,635,612) Total lease liabilities 22,606,871 |
SHORT-TERM LOANS
SHORT-TERM LOANS | 12 Months Ended |
Dec. 31, 2023 | |
SHORT-TERM LOANS | |
SHORT-TERM LOANS | (10) SHORT-TERM LOANS Loan Facility In May 2022, Huanqiuyimeng entered into a two-year Commercial Loan Facility (the “Facility”) with China Minsheng Bank Beijing Branch to borrow up to RMB 20,000,000 at an interest rate, which is subject to potential adjustment based on premium interest rate stipulated by the People’s Bank of China at the time upon drawing of credit lines to support the working capital need of Huanqiuyimeng. The Facility is pledged by the real estate property owned by ATA Education under a two-year pledge agreement among ATA Education, Huanqiuyimeng and China Minsheng Bank Beijing Branch. For the year ended December 31, 2023, the Group has not withdrawn any line of credit from this loan facility. Bank borrowings The Company entered into several short-term bank borrowings in total amount of RMB13,327,000 in 2020 to support operations of Huanqiuyimeng during the COVID-19 outbreak, which was fully repaid as of December 31, 2021. Other borrowings During the year of 2020, to support its daily operations among COVID–19, Muhua Shangce, the majority owned subsidiary of the Group obtained short-term borrowings from several parties, including: i) the Group’s CEO and Director, Mr. Xiaofeng Ma, in the amount of RMB 631,000 with no interest; ii) a third-party company, in the amount of RMB 3.0 million at an annual interest rate of 4.35% , which Mr. Xiaofeng Ma has provided a joint liability guarantee; iii) the CEO of Muhua Shangce in the amount of RMB 1,260,000, among which RMB 500,000 at an annual interest rate of 2.00% and RMB 760,000 with no interest ; iv) a company controlled by Mr. Xiaofeng Ma in the amount of RMB 500,000 with no interest; v) three third party companies in the amount of RMB 900,000 with no interest. Muhua Shangce has repaid the CEO of Muhua Shangce and three third party companies in total amount of RMB1,490,000 in 2020. During 2021 and prior to the disposal of Muhua Shangce, a partnership controlled by the Group’s CEO and Director, Mr. Xiaofeng Ma provided a fourteen-month interest-free loan in the amount of RMB 700,000 to Muhua Shangce. Muhua Shangce also borrowed from its CEO for another RMB1,210,000, among which RMB 150,000 at an annual interest rate of 6.12% and RMB 1,060,000 with no interest. In addition, Muhua Shangce borrowed from three third party companies in the amount of RMB 800,000 with no interest. As of the selling date of Muhua Shangce in June 2021, the outstanding balance of the above borrowings of RMB 7,511,000 remained unpaid and has been disposed together with the other assets and liabilities of Muhua Shangce. See Note 14 for details. |
ACCRUED EXPENSES AND OTHER PAYA
ACCRUED EXPENSES AND OTHER PAYABLES | 12 Months Ended |
Dec. 31, 2023 | |
ACCRUED EXPENSES AND OTHER PAYABLES | |
ACCRUED EXPENSES AND OTHER PAYABLES | (11) ACCRUED EXPENSES AND OTHER PAYABLES Accrued expenses and other payables consist of the following: December 31, December 31, 2022 2023 RMB RMB Refund liability* 19,976,189 22,141,880 Accrued payroll and welfare 20,228,470 17,901,640 Accrued test monitoring fees 2,432,153 — Accrued professional services expenses 3,791,413 3,102,467 Income taxes payable 14,834 1,081 Other current liabilities 9,461,451 5,999,035 Total accrued expenses and other payables 55,904,510 49,146,103 Other current liabilities as of December 31, 2022 and 2023 mainly include accrued advertising and outsourcing fees, value-added tax and other taxes payable, and other operating expense payable. *Refund liability represents the estimated amount of refund if a student decides to withdraw from the Group’s programs or services or a full or partial return of the service fees are repaid to students based on the final outcome of the performance targets and is estimated based on historical experience and performance. |
NET REVENUES
NET REVENUES | 12 Months Ended |
Dec. 31, 2023 | |
NET REVENUES | |
NET REVENUES | (12) NET REVENUES The components of net revenues for the years ended December 31, 2021, 2022 and 2023, are as follows: Year ended December 31, 2021 2022 2023 RMB RMB RMB Portfolio training services 151,433,831 153,136,274 166,448,699 Research-based learning services 5,977,438 3,721,829 6,512,650 Overseas study counselling services 23,623,998 24,974,973 28,993,831 Other educational services 21,174,198 24,657,609 19,663,788 K-12 education assessment and other services — 330,189 — Net Revenues 202,209,465 206,820,874 221,618,968 K-12 education assessment and other services revenues primarily include K-12 education assessment services and content development services. The Company no longer provided K-12 education assessment services along with the disposal of Muhua Shangce since June 2, 2021. Deferred revenue is recorded when the Group has an obligation to transfer goods or services to a customer for which the Group has received consideration from the customer in advance. Changes in the deferred revenue balances during the year ended December 31, 2022 and 2023 are as follows: Fiscal year ended December 31, 2022 2023 RMB RMB Balance at the beginning of the period 202,453,092 219,717,574 Cash received in advance, net of VAT 223,388,868 261,312,149 Acquisition of Youru and subsequent movement 1,534,529 (1,336,197) Revenue recognized from opening balance of deferred revenue (113,271,035) (122,951,789) Revenue recognized from deferred revenue arising during the year (88,928,077) (102,430,097) Disposal of equity interests in subsidiaries for deconsolidation (1,609,644) — Change of refund liabilities (3,850,159) (2,165,691) Balance at the end of the period 219,717,574 252,145,949 |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2023 | |
INCOME TAXES | |
INCOME TAXES | (13) INCOME TAXES Cayman Islands and British Virgin Islands Under the current laws of the Cayman Islands and the British Virgin Islands, the Group is not subject to any income tax in these jurisdictions. Hong Kong ACG HK did not derive any income that is subject to Hong Kong profits tax for the taxable years ended December 31, 2021, 2022 and 2023. Accordingly, no provision for Hong Kong profits tax was required. People’s Republic of China The Company’s consolidated PRC entities file separate income tax returns. Under the Enterprise Income Tax Law (“EIT Law”), the statutory income tax rate is 25% effective from January 1, 2008. Entities that qualify as “high-and-new technology enterprises eligible for key support from the State” (“HNTE”) are entitled to a preferential income tax rate of 15%. If an HNTE enterprise no longer satisfies the related accreditation criteria, its certificate will be cancelled and it will cease to be entitled to the related tax incentives. The Company’s PRC entities are subject to income tax at 25%, unless otherwise specified. In December 2008, ATA Education received approval from the tax authority that it qualified as an HNTE. The certificate entitled ATA Education to the preferential income tax rate of 15 % effective retroactively from January 1, 2008 to December 31, 2010. In October 2011, ATA Education received approval from the tax authority on its renewal as an HNTE which entitled it to the preferential income tax rate of 15 % effective retroactively from January 1, 2011 to December 31, 2013. In October 2014 and 2017, ATA Education received approval from the tax authority on its renewal as an HNTE, which entitled it to the preferential income tax rate of 15 % effective from January 1, 2014 to December 31, 2016 and from January 1, 2017 to December 31, 2019, respectively. In December 2020, ATA Education received approval from the tax authority on its renewal as an HNTE, which entitled it to the preferential income tax rate of 15 % effective retroactively from January 1, 2020 to December 31, 2022. In December 2009, Muhua Shangce received approval from the tax authority that it qualified as an HNTE. The certificate entitled it to the preferential income tax rate of 15% effective retroactively from January 1, 2009 to December 31, 2011. In July 2012, Muhua Shangce received approval from the tax authority on its renewal as an HNTE which entitled it to the preferential income tax rate of 15% effective from January 1, 2012 to December 31, 2014. In November 2015 and October 2018, Muhua Shangce received approval from the tax authority on its renewal as an HNTE, which entitled it to the preferential income tax rate of 15% effective from January 1, 2015 to December 31, 2017 and from January 1, 2018 to December 31, 2020, respectively. Muhua Shangce was no longer consolidated into the Group after the disposal of its entire equity interests on June 2, 2021. See Note 14. The EIT Law and its relevant regulations impose a withholding tax at 10% for earnings generated beginning January 1, 2008, unless reduced by a tax treaty or agreement, for dividends distributed by a PRC-resident enterprise to its immediate holding company outside the PRC. Undistributed earnings generated prior to January 1, 2008 are exempt from withholding tax. As of December 31, 2022 and 2023, the Company has not accrued income taxes on earnings of RMB2,486,972 and RMB 1,993,552 respectively, generated by its PRC consolidated entities, as the Company plans to reinvest these earnings indefinitely in the PRC. The unrecognized deferred income tax liability related to these earnings was RMB248,697 and RMB199,355, respectively as of December 31, 2022 and 2023. Loss before income taxes were generated in the following jurisdictions: Year Ended December 31, 2021 2022 2023 RMB RMB RMB Cayman Islands and British Virgin Islands (18,488,181) (7,206,659) (5,467,559) PRC (19,442,469) (47,256,605) (35,026,914) Hong Kong (19,044) (52,351) (27,777) Loss before income taxes (37,949,694) (54,515,615) (40,522,250) Income tax expense (benefit) recognized in the consolidated statements of comprehensive income (loss) consists of the following: Year Ended December 31, 2021 2022 2023 RMB RMB RMB PRC Current income tax expense 22,781 130,635 1,081 Deferred income tax benefit (1,562,358) (6,052,019) (6,812,790) Total income tax benefit (1,539,577) (5,921,384) (6,811,709) The actual income tax expense (benefit) reported in the consolidated statements of comprehensive income (loss) differs from the respective amount computed by applying the PRC statutory income tax rate of 25% for each of the years ended December 31, 2021, 2022 and 2023 to earnings before income taxes due to the following: Year Ended December 31, 2021 2022 2023 RMB RMB RMB Computed “expected” income tax benefit (9,487,423) (13,628,904) (10,130,563) Increase in valuation allowance 10,531,372 6,084,383 (2,014,183) Entities not subject to income tax 1,691,406 1,429,868 606,823 Non-deductible expenses Entertainment 280,436 192,298 177,509 Share-based compensation 259,993 364,939 767,010 Other non-deductible expenses 3,927,212 1,625,037 4,186,105 Additional deduction of research and development costs (120,598) — — Disposal of equity interests in subsidiaries (8,385,539) (1,577,200) — Other (236,436) (411,805) (404,410) Actual income tax benefit (1,539,577) (5,921,384) (6,811,709) The applicable PRC statutory income tax rate is used since the Group’s taxable income is generated in the PRC. The tax effects of the Group’s temporary differences that give rise to significant portions of the deferred income tax assets and liabilities are as follows: December 31, December 31, 2022 2023 RMB RMB Deferred income tax assets: Tax loss carry forwards 34,562,809 38,132,866 Impairment and investment loss of long-term investments 10,598,946 10,598,946 Lease liabilities 9,112,298 5,651,718 Intangible assets and other non-current assets 405,191 — Provision for loan receivable and other receivables 2,927,994 2,927,994 Accrued expenses and other payables 3,652,004 1,781,265 Property and equipment, net 53,301 26,010 Donation 5,000,000 2,500,000 Total gross deferred income tax assets 66,312,543 61,618,799 Less: valuation allowance (51,769,696) (47,255,513) Total deferred income tax assets, net 14,542,847 14,363,286 Deferred income tax liabilities: Intangible assets 19,029,861 14,721,528 Right-of-use assets 8,721,522 5,346,529 Contract cost assets 5,670,767 6,361,742 Total gross deferred income tax liabilities 33,422,150 26,429,799 Net deferred income tax liabilities 18,879,303 12,066,513 The movements of the valuation allowance are as follows: Year Ended December 31, 2021 2022 2023 RMB RMB RMB Balance at the beginning of the period 56,172,945 48,897,848 51,769,696 Additions 10,531,372 6,084,383 (2,014,183) Reduction due to expiration of temporary difference — (2,500,000) (2,500,000) Reduction as a result of deconsolidation of subsidiaries (17,806,469) (712,535) — Balance at the end of the period 48,897,848 51,769,696 47,255,513 As of December 31, 2023, the valuation allowance of RMB 47,255,513 was related to the deferred income tax assets of PRC entities which were in loss position. As of December 31, 2023, the Group had tax loss carry forwards for PRC income tax purpose of RMB 152,531,464, of which RMB 53,627,996, RMB 33,091,899, RMB 20,501,771, RMB 29,668,060, and RMB 14,280,230 will expire if unused by December 31, 2024, 2025, 2026, 2027 and 2028, respectively. For the years ended December 31, 2021, 2022 and 2023, the Group had no unrecognized tax benefits, and thus no related interest and penalties were recorded. Also, the Group does not expect that the amount of unrecognized tax benefits will significantly increase within the next twelve months. According to the PRC Tax Administration and Collection Law, the statute of limitation is three years if the underpayment of taxes is due to computational errors made by the taxpayer or the withholding agent. The statute of limitation is extended to five years under special circumstances where the underpayment of taxes is more than RMB 100,000. In the case of transfer pricing issues, the statute of limitation is ten years. There is no statute of limitation in the case of tax evasion. The income tax return of each of the Company’s PRC consolidated entities is subject to examination by the relevant tax authorities for the calendar tax years beginning 2018. |
NON-CONTROLLING INTERESTS
NON-CONTROLLING INTERESTS | 12 Months Ended |
Dec. 31, 2023 | |
NON-CONTROLLING INTERESTS | |
NON-CONTROLLING INTERESTS | (14) NON-CONTROLLING INTERESTS (a) Redeemable non-controlling interests In February 2017, two third-party investors (“the investors”) acquired 20% of the equity interest of Muhua Shangce at a consideration of RMB 34,000,000. The investors have the right to ask Muhua Shangce to purchase back part or all of the equity interest if Muhua Shangce does not achieve a qualified IPO within 6 years, as defined by the investment agreement, at the redemption price of RMB 34,000,000 plus 8% of interest for the period from February 2017 to the date of redemption. The redeemable non-controlling interest was recorded outside permanent equity as mezzanine equity- redeemable non-controlling interests in the consolidated balance sheets and initially recorded at the carrying value of RMB 34,000,000. The amount presented in redeemable non-controlling interest should be the greater of the non-controlling interest balance after attribution of net income or loss of the subsidiary and related dividends to the non-controlling interest or the amount of redemption value. On September 26, 2019, Muhua Shangce entered into a new financing agreement with its redeemable non-controlling interests holder, Muhua Investment, and received cash of RMB 5,000,000 on September 29, 2019. After Muhua Shangce’s new financing, ACG’s equity shares decreased from 56% to 54.6% and ACG still has control of Muhua Shangce. The investor who made this new investment, has the right to ask Muhua Shangce to purchase back up to 50% of the new equity interests if Muhua Shangce does not achieve a qualified IPO within 5 years, as defined by the investment agreement, at the redemption price of RMB 2,500,000 plus 8% of interest for the period from September 2019 to the date of redemption. The redeemable non-controlling interest was recorded outside permanent equity as mezzanine equity- redeemable non-controlling interests in the consolidated balance sheets and initially recorded at the carrying value of RMB 2,500,000. The amount presented in redeemable non-controlling interest should be the greater of the non-controlling interest balance after attribution of net income or loss of the subsidiary and related dividends to the non-controlling interest or the amount of redemption value. On June 2, 2021, ATA Education sold all its 54.6% equity interests in Muhua Shangce to CEO of Muhua Shangce and certain other non-controlling shareholders at nil consideration. On the same day, the registration for change of shareholders has been completed in local industrial and commercial administration authority. As a result of the above transaction, the Company deconsolidated Muhua Shangce as of June 2, 2021 when the Company no longer has a controlling financial interest in Muhua Shangce, by removing its net assets and recognizing a gain or loss in net income per ASC810-10. In addition, previously recorded adjustments of RMB 24,310,333 to the carrying amount of redeemable non-controlling interests from the application of Section 480-10-S99 are eliminated in the same manner as which they were initially recognized. The following table presents balance of the Mezzanine Equity as of December 31, 2020 and as of the period-end prior to its disposal in the year of 2021. RMB Balance as of December 31, 2020 48,498,368 Less: Comprehensive loss attributable to redeemable non-controlling interests during the period (714,121) Accretion of redeemable non-controlling interests 2,283,089 Balance as of June 2, 2021 50,067,336 (b) Non-redeemable non-controlling interests On October 26, 2018, Board of Directors approved that 24% of the equity shares of Muhua Shangce was transferred to a limited partnership named Ningbo Meishan Bonded Port Area Zunming Investment Management Center (Limited Partnership) (“Limited Partnership”) from ATA Education at a consideration of RMB 1,500,000. The consideration has been fully paid to ATA Education by the Limited Partnership on December 26, 2018. As a result of the new investment made in 2019 to Muhua Shangce as stated above, 50% of the new investment, amounting to RMB 2,500,000, which does not represent redeemable non-controlling interests, was recorded under non-redeemable non-controlling interests. The relevant non-controlling interests retained was disposed along with the sale of equity interests in Muhua Shangce. Muhua Shangce generated pretax losses of RMB 12,446,417, and RMB 3,441,545 for the years ended December 31, 2020 and the period before its disposal in 2021, respectively, of which RMB 6,795,744, and RMB 1,879,084 were attributed to the Company. Upon the disposal of Muhua Shangce, the Company recorded a gain amounting to RMB33,542,154 for the year ended December 31, 2021. The calculation of the Company’s disposal gain is included in the following. RMB Cash consideration received from the disposal of Muhua Shangce — Add: Carrying value of redeemable non-controlling interests in Muhua Shangce 25,757,003 Add: Carrying value of non-redeemable non-controlling interests of Muhua Shangce (4,423,059) Subtotal 21,333,944 Less: Carrying value of net liabilities before disposal (12,208,210) Gain from the disposal of Muhua Shangce 33,542,154 |
SEGMENT INFORMATION
SEGMENT INFORMATION | 12 Months Ended |
Dec. 31, 2023 | |
SEGMENT INFORMATION | |
SEGMENT INFORMATION | (15) SEGMENT INFORMATION The Group’s chief operating decision maker has been identified as the Chief Executive Officer who reviews consolidated results when making decisions about allocating resources and assessing performance of the Group. The Group uses the management approach to determine the operating segments. The management approach considers the internal organization and reporting used by the Group’s chief operating decision maker for making decisions, allocating resources and assessing the performance. There are no inter-segment revenue transactions and, therefore, revenues are only generated from external customers. The accounting policies of the segments are the same as those used by the Group. For the years ended December 31, 2021, 2022 and 2023, the Group classified the operating segments into (i) Overseas art study services (ii) Other educational services and (iii) K-12 education assessment and other services. Overseas art study services and Other educational services have been identified as two separate reportable segments, as the two operating segments have met the quantitative threshold of 10 percent to be considered reportable respectively. The K-12 education assessment and other services are reported as others because revenue from reportable segments of Overseas art study services and Other educational services exceeds 75 percent of the total consolidated net revenues and management determines that no further reportable segments need to be identified and disclosed. Furthermore, the Group’s chief operating decision maker evaluates performance based on each reporting segment’s net revenue, operating cost and expenses, and income (loss) from operations. There are no separate segment assets and segment liabilities information provided to the Group’s Chief Executive Officer, as he does not use this information to allocate resources or evaluate the performance of the segments. The following table presents selected financial information relating to the Group’s segments: Overseas art study Other educational For the year ended December 31, 2023: services services Others Consolidated RMB RMB RMB RMB Net revenues 201,955,180 19,663,788 — 221,618,968 Operating cost and expenses: Cost of revenues 96,661,054 10,225,877 74,828 106,961,759 Research and development 3,672,094 114,516 843,270 4,629,880 Selling and marketing 73,182,842 5,437,897 116,753 78,737,492 Unallocated corporate expenses* — — — 72,816,606 Total operating cost and expenses 173,515,990 15,778,290 1,034,851 263,145,737 Other operating income, net 30,865 — — 30,865 Income (Loss) from operations 28,470,055 3,885,498 (1,034,851) (41,495,904) Unallocated other income, net 973,654 Loss before income taxes (40,522,250) Overseas art study Other educational For the year ended December 31, 2022: services services Others Consolidated RMB RMB RMB RMB Net revenues 181,833,076 24,657,609 330,189 206,820,874 Operating cost and expenses: Cost of revenues 92,389,567 11,552,359 373,930 104,315,856 Research and development 5,903,055 — 887,736 6,790,791 Selling and marketing 69,398,473 5,736,053 131,200 75,265,726 Unallocated corporate expenses* — — — 77,051,580 Total operating cost and expenses 167,691,095 17,288,412 1,392,866 263,423,953 Other operating income, net — — 16,515 16,515 Income (Loss) from operations 14,141,981 7,369,197 (1,046,162) (56,586,564) Unallocated other income, net 2,070,949 Loss before income taxes (54,515,615) Overseas art study Other educational For the year ended December 31, 2021: services services Others Consolidated RMB RMB RMB RMB Net revenues 181,035,267 21,174,198 — 202,209,465 Operating cost and expenses: Cost of revenues 81,964,815 14,154,713 1,294,387 97,413,915 Research and development 4,176,398 3,148,402 4,476,745 11,801,545 Selling and marketing 60,436,932 5,598,532 113,996 66,149,460 Unallocated corporate expenses* — — — 93,256,046 Total operating cost and expenses 146,578,145 22,901,647 5,885,128 268,620,966 Other operating income, net — — 22,018 22,018 Income (Loss) from operations 34,457,122 (1,727,449) (5,863,110) (66,389,483) Unallocated other income, net 28,439,789 Loss before income taxes (37,949,694) *Unallocated corporate expenses represent the general and administrative expenses for the years ended December 31, 2021, 2022 and 2023. Majority of the Group’s operations, customers and long-lived assets are located in the PRC. Consequently, no geographic information is presented. |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2023 | |
SHARE-BASED COMPENSATION | |
SHARE-BASED COMPENSATION | (16) SHARE-BASED COMPENSATION 2008 Share incentive plan On January 7, 2008, the Company adopted a share incentive plan (the “2008 Plan”), pursuant to which the Company is authorized to issue options and other share-based awards to officers, employees, directors and consultants of the Group to purchase up to 336,307 of its common shares, plus, unless the board of directors determines a lesser amount, an annual increase on January 1 of each calendar year beginning in 2009 equal to the lesser of 1) one percent of the number of shares issued and outstanding on December 31 of the immediately preceding calendar year, and 2) 336,307 shares (the “replenish terms”). The 2008 Plan expires in ten years. Options awards provide for accelerated vesting if there is a change in control (as defined in the 2008 Plan). On December 30, 2016, the Company amended the 2008 Plan to increase the number of Common Shares of the Company reserved for issuance to 5,726,763 shares and extend the plan together with the replenish terms for ten years from December 30, 2016 (the “Amendment and Restatement of 2008 Plan”). On October 26, 2018, the Company amended and restated the Amendment and Restatement of 2008 Plan to increase the number of Common Shares the Company reserved for issuance to 6,965,846 shares, extend its terms to last till October 25, 2028 and change the number of common shares automatically added to the option pool on each calendar year during its term to an amount equal to the lesser of (i) one percent of the total number of common shares issued and outstanding on December 31 of the immediately preceding calendar year, or (ii) such number of common shares as may be established by the board of directors (the “Second Amendment and Restatement of 2008 Plan”). As of December 31, 2023, 9,929,472 shares were reserved for issuance under the Second Amendment and Restatement of 2008 Plan. Under the 2008 Plan (including the original and both versions of the Amendment and Restatement), share options are generally granted with 25% vesting on the first anniversary of the grant date and the remaining 75% vesting ratably over the following 36 months, unless a shorter or longer duration is established at the time of the option grant. Share options are granted at an exercise price equal to or as an average over a certain number of trading days of the fair market value of the Company’s share at the date of grant and expire 10 years from the grant date, unless a shorter or longer expiration period is specified. Under the 2008 Plan (including the original and both versions of the Amendment and Restatement), non-vested shares are generally granted with a graded vesting as to 25% at the end of each year from the grant date over 4 years, or with certain percentage vesting on the grant date or first anniversary of the grant date and the remaining portion vesting ratably over the following 36 months, unless a shorter or longer duration is established at the time of the grant. For the graded vesting share options and non-vested shares, the Company recognizes the compensation cost over the requisite service period for each separately vesting portion of the award as if the award is, in substance, multiple awards. In January 2017, 2,700,000 non-vested shares were granted to employees and officers with a graded vesting as to 25% at the end of each year from the grant date over 4 years and 900,000 share options were granted to Company’s employees and officers, 25% of the options vest on the first anniversary of the grant date with the remaining 75% vesting evenly over the following 36 months. The exercise price of these options is USD 1.705 per common share. In August 2017, 50,000 share options were granted to an employee, 25% of the options vest on the first anniversary of the grant date with the remaining 75% vesting evenly over the following 36 months. The exercise price of these options is USD 2.35 per common share. In July 2018, 129,168 share options and 1,262,250 non-vested shares were cancelled in connection with the ATA Online Sale Transaction. RMB 6,753,771 compensation costs were accelerated and recognized for the year ended December 31, 2018. In November 2018, 1,772,584 share options, including 1,215,114 vested share options and 557,470 non-vested share options were cancelled in accordance with the board of directors’ resolutions. RMB 877,321 of compensation costs were accelerated and recognized for the year ended December 31, 2018. In November 2018, 1,452,600 share options were issued to certain employees and officers with 4 years’ service condition and annual performance targets for the year 2018, 2019, 2020 and 2021, among which 363,150 share options were granted in November 2018 and the remaining portion will be granted when the employee knows the specific performance target. As the performance condition for the year 2018 was not achieved, no compensation cost was recognized for these share options. In addition, 690,000 share options were granted to employees and officers, with 25% vesting on the first anniversary of the grant date and the remaining 75% vesting ratably over the following 36 months. The exercise price of these options is USD 0.578 per common share. In addition, 800,000 non-vested shares were granted to directors, with 25% vesting on the first anniversary of the grant date and the remaining 75% vesting ratably over the following 36 months. In December 2018, 1,772,584 shares were granted to employees and officers, among which 1,412,336 shares vested immediately on the grant date and the remaining shares vested for a period from January 1, 2019 to September 1, 2021. In January and March 2019, 50,000 and 20,000 share options were granted to employees and officers, with 25% vesting on the first anniversary of the grant date and the remaining 75% vesting ratably over the following 36 months. The exercise prices of these two tranches options are USD 0.4868 and USD 0.532 per common share respectively. In 2019, 1,698,790 share options with exercise price at USD 1.2611 per common share were issued to certain officer with service condition and specific performance target, among which 424,698 share options (the “First Tranche”) were granted on March 25, 2020 and vested on April 1, 2022; 424,698 share options (the “Second Tranche”) were granted on March 15, 2022 and vested on April 1, 2023; 424,697 share options (the “Third Tranche”) were granted on May 5, 2023 and vested on April 1, 2024. The remaining shall vest on April 1, 2025 on the condition that specific performance target is achieved. In November 2020, 842,000 share options with exercise price at USD 0.5697 per common share were issued to certain employees with service condition and specific performance target, among which 181,750 share options (the “First Tranche -A”), 173,002 share options (the “Second Tranche-A”), and 158,000 share options (the “Third Tranche-A”) were granted on April 15, 2021, April 15, 2022, and April 15, 2023, respectively. The remaining portion will be granted when the specific performance target is established and there is mutual understanding of the terms of the award. 46,050 share options among the First Tranche-A has met the performance condition set forth in the grant agreements and vested on June 30, 2022. 57,250 share options among the Second Tranche-A has met the performance condition set forth in the grant agreements and has vested on April 1, 2023. 83,400 share options among the Third Tranche-A has met the performance condition set forth in the grant agreements and has vested on April 1, 2024. In November 2020, 310,000 restricted shares were issued to certain employees with service condition and specific performance target, among which 77,500 shares (the “First Tranche- B”), 77,500 shares (the “Second Tranche-B”), and 72,500 shares (the “Third Tranche-B”) were granted on April 15, 2021, April 15, 2022, and April 15, 2023, respectively. The remaining portion will be granted when the specific performance target is established and there is mutual understanding of the terms of the award. 16,000 shares among the First Tranche-B has met the performance condition set forth in the grant agreements and vested on June 30, 2022, 24,750 shares among the Second Tranche-B has met the performance condition set forth in the grant agreements and vested on April 1, 2023 , and 43,250 shares among the Third Tranche - B has met the performance condition set forth in the grant agreements and vested on April 1, 2024. In February 2022, 200,000 share options with exercise price at USD 0.79 per common share were granted to certain officer with service condition, with one 273,000 restricted shares were granted to an employee with service condition on October 27, 2022, among which 40% of the shares shall vest on October 27, 2023, 40% on October 27, 2024 and the remaining on October 27, 2025. In November 2023, 20,000 share options with exercise price at USD 0.48 per common share were issued with service condition and specific performance target, among which 5,000 shares (the “First Tranche-C”) were granted on November 1, 2023. The remaining portion will be granted when the specific performance target is established and there is mutual understanding of the terms of the award. 5,000 shares among the First Tranche-C has met the performance condition set forth in the grant agreements and vested on April 1, 2024. 800,000 non-vested shares were granted to directors in November 2023, with 25% vesting on the first anniversary of the grant date and the remaining 75% vesting ratably over the following 36 months. Other than the restricted shares issued in November 2020 and October 2022, the restricted shares were awarded with non-forfeitable dividend rights before vesting. A summary of the share options activities for years ended December 31, 2021, 2022 and 2023: Weighted Weighted Aggregate average remaining Intrinsic Number of exercise contractual Value shares USD years USD Outstanding as of December 31, 2020 827,198 1.01 — — Granted 181,750 0.57 — — Exercised (62,416) 0.58 — — Forfeited (135,700) 0.57 — — Cancelled — — — — Expired — — — — Outstanding as of December 31, 2021 810,832 1.02 — — Granted 797,700 0.99 — — Exercised (53,538) 0.58 — — Forfeited (178,252) 0.97 — — Cancelled — — — — Expired — — — — Outstanding as of December 31, 2022 1,376,742 1.03 — — Granted 587,697 1.07 — — Exercised (113,328) 0.58 — — Forfeited (162,518) 0.57 — — Cancelled — — — — Expired — — — — Outstanding as of December 31, 2023 1,688,593 1.12 — — Vested and expected to vest as of December 31, 2023 1,688,593 1.12 6.04 3,093 Exercisable as of December 31, 2023 1,025,496 1.15 5.82 1,747 The aggregate intrinsic value of options outstanding and exercisable at December 31, 2023, was determined based on the closing price of the Company’s common shares on December 31, 2023. Information relating to options outstanding and exercisable as of December 31, 2023 is as follows: Options outstanding as of December 31, 2023 Options exercisable as of December 31, 2023 Exercise Remaining Exercise Remaining Number of Price Contractual Number Price Contractual Shares per Share Life of Shares per Share Life USD Years USD Years 20,000 0.58 4.85 20,000 0.58 4.85 16,800 0.53 5.21 16,800 0.53 5.21 1,274,093 1.26 5.60 849,396 1.26 5.60 172,700 0.57 7.01 89,300 0.57 7.01 200,000 0.79 8.11 50,000 0.79 8.11 5,000 0.48 10.01 1,688,593 1.12 6.04 1,025,496 1.15 5.82 The Company calculated the fair value of the share options on the grant date, for the years ended December 31, 2021, 2022 and 2023, using the Black-Scholes-Merton pricing valuation model. The assumptions used in the valuation model are summarized as follows: Year Ended December 31, 2021 2022 2023 Expected dividend yield 0 % 0 % 0 % Expected volatility 70 % 67 % 68 % Expected term 5.40 4.17/4.79/6.25 3.58/4.29/5.25 Risk-free interest rate (per annum) 0.90 % 2.08%/2.78%/1.84 % 3.57%/3.68%/4.68 % The expected volatility was based on the historical volatilities of the Company. The expected term was related to the period of time the options are expected to be outstanding. The risk-free rate for periods within the contractual life of the option is based on the United States treasury yield curve in effect at the time of grant. Compensation expense recognized for share options for the year ended December 31, 2021, 2022 and 2023 is allocated to the following expense items: Year Ended December 31, 2021 2022 2023 RMB RMB RMB Cost of revenues 62,224 59,874 53,104 Research and development 6,944 4,785 — Sales and marketing 6,806 35,546 53,133 General and administrative 476,435 935,582 1,443,900 Total share-based compensation expense 552,409 1,035,787 1,550,137 The weighted-average grant-date fair value of share options granted in 2021, 2022 and 2023 were USD 1.20, USD 0.31 and USD 0.46, respectively. The total intrinsic value of share options exercised by the Group’s employees during the years ended December 31, 2021, 2022 and 2023 were USD 58,268, USD 29,532 and USD 8,773, respectively. As of December 31, 2023, RMB 593,891 of total unrecognized compensation expense related to non-vested share options is expected to be recognized over a weighted average period of approximately 0.75 years. Non-vested shares A summary of the non-vested shares activities for the year ended December 31, 2021, 2022 and 2023 is presented below: Weighted average grant Number date fair of shares value USD Outstanding at December 31, 2020 603,088 0.955 Granted 77,500 1.545 Vested (419,752) 1.112 Forfeited (61,500) 1.545 Cancelled — — Outstanding at December 31, 2021 199,336 0.671 Granted 350,500 0.841 Vested (199,336) 0.671 Forfeited (52,750) 0.615 Cancelled — — Outstanding at December 31, 2022 297,750 0.881 Granted 872,500 0.467 Vested (133,950) 0.851 Forfeited (29,250) 0.925 Cancelled — — Outstanding at December 31, 2023 1,007,050 0.525 The total fair value of shares vested during the years ended December 31, 2021, 2022 and 2023 was USD422,516, USD150,982 and USD76,300 respectively. Upon vesting of the non-vested shares, the Company withholds shares issued to the employees to meet the relevant minimum tax withholding requirements. For the years ended December 31, 2021, 2022 and 2023, the Company withheld 13,464, 6,148 and 19,004 vested shares upon vesting of the non-vested shares to satisfy the minimum tax withholding obligation. Compensation expense recognized for non-vested shares for the years ended December 31, 2021, 2022 and 2023 is allocated to the following expense items: Year Ended December 31, 2021 2022 2023 RMB RMB RMB Cost of revenues 27,806 29,057 21,722 Research and development 3,692 — — Sales and marketing 11,741 40,655 63,321 General and administrative 444,324 354,256 1,432,861 Total share-based compensation expense 487,563 423,968 1,517,904 As of December 31, 2023, RMB 2,756,874 of total unrecognized compensation expense related to non-vested shares is expected to be recognized over a weighted average period of approximately 3.44 years. |
COMMON SHARES
COMMON SHARES | 12 Months Ended |
Dec. 31, 2023 | |
COMMON SHARES | |
COMMON SHARES | (17) COMMON SHARES On December 18, 2019, the Company entered into a subscription agreement with CL-TCC, a company focusing on investments in culture and education industry, in connection with a private placement for the Company’s common shares. ACG completed this private placement with CL-TCC on December 24, 2019, under which it issued 5,662,634 common shares of the Company for gross proceeds of approximately $10.0 million. As of December 31, 2019, ACG has received cash consideration of $8.8 million (RMB 61.7 million) in accordance with the payment terms of the subscription agreement. The rest of the proceeds of $1.2 million (RMB 8.5 million) was received on April 10, 2020. In May 2020, ACG’s Board of Directors approved a share repurchase plan authorizing the Company to repurchase up to US$1.0 million of its issued and outstanding ADSs from the open market and through privately negotiated transactions, effective through December 31, 2020. By December 31, 2020, the Company had repurchased 450,337 ADSs at an average stock price of US$1.2631 for a total cash consideration of $0.6 million (RMB 4.0 million). This share repurchase plan expired on December 31, 2020. The Company has cumulatively used 1,080,549 ADSs and 1,124,626 ADSs purchased from the open market for settlement of vested share options and restricted shares vesting as of December 31, 2022 and 2023 respectively. |
STATUTORY RESERVES
STATUTORY RESERVES | 12 Months Ended |
Dec. 31, 2023 | |
STATUTORY RESERVES | |
STATUTORY RESERVES | (18) STATUTORY RESERVES In accordance with the relevant laws and regulations of the PRC, the Company’s PRC consolidated entities are required to transfer 10% of their respective after-tax profit, as determined in accordance with PRC accounting standards and regulations to a general reserve fund until the balance of the fund reaches 50% of the registered capital of the respective entity. The transfer to this general reserve fund must be made before any distribution of dividends. As of December 31, 2022 and 2023, the PRC consolidated entities had accumulated statutory reserve balances of RMB 25,698,704 and RMB 25,698,704, respectively, which is restricted for distribution to the Company. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2023 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | (19) RELATED PARTY TRANSACTIONS (1) Purchase of equity interest from a Related Party In 2023, we acquired 100% equity interests of Jinan Nuobi. The equity interest was transferred from Jun Zhang, the President and Director of the Company, and a consideration of RMB 0.5 million was paid in August, 2023. (2) Purchase of IT System Consulting Service, Office Sharing Service and System Development and Data Services from an Affiliate Company Huanqiuyimeng has purchased consulting services relating to IT system from an affiliate company, ApplySquare Education & Technology Co., Ltd. (“Applysquare”) in October 2021. The expense recorded for the year ended December 31, 2021 was RMB 50,913. In October 2021, Huanqiuyimeng entered into an agreement for utilizing certain office space of ApplySquare with a term from October 16, 2021 to October 15, 2022. The total amount of the agreement was RMB1.2 million and expense of RMB 275,967 was recorded for the year ended December 31, 2021. In June 2022, Huanqiuyimeng entered into a supplementary agreement with Applysquare to increase the contract amount by RMB 22,000 for certain expense incurred. In September 2022, Huanqiuyimeng extended the above office space agreement for another year to October 15, 2023 and a total expense of RMB1,128,016 was recorded for the year ended December 31, 2022 in accordance with the above agreements. The office space agreement was terminated in March 2023 due to certain changes in operations. A total expense of RMB 236,960 was recorded for the year ended December 31, 2023. In January 2022, Huanqiuyimeng entered into an agreement with Applysquare, pursuant to which ApplySquare shall develop system platforms and provide related data services to support Huanqiuyimeng’s operations and service delivery. The total amount of the agreement was RMB 6.5 million, which includes a one-year charge of data and system maintenance services. As of December 31, 2022, the system platforms are still under development and RMB 3.7 million expense was recorded for the year ended December 31, 2022 in accordance with the development progress. In March 2023, Huanqiuyimeng entered into a supplementary agreement with Applysquare, under which the contract amount was reduced to RMB 6.3 million due to cost optimization. RMB 1.8 million expense was recorded for the year ended December 31, 2023. (3) Purchase of video services from an Affiliate Company In September 2022, Huanqiuyimeng entered into an agreement with ATA Learning Inc., pursuant to which ATA Learning Inc. provided professional videography and production of video services to Huanqiuyimeng. The total amount of the agreement was USD10,000. Majority of the services were completed in December 2022 and expense of RMB 49,579 and RMB 21,248 was recorded accordingly for the years ended December 31, 2022 and 2023, respectively. (4) Amounts Due to a Related Party The CEO, director and shareholder of the Company, Mr. Xiaofeng Ma has offered interest-free personal funding support of RMB 431,000 and RMB 200,000 on March 5 and March 30, 2020 respectively to Muhua Shangce, a then majority owned subsidiary of the Company, to support its operational cash needs during COVID-19, which became due in September 2020 and was extended for one year to September 2021. The outstanding balance was RMB 631,000 as of December 31, 2020. Muhua Shangce was disposed of in June 2021 and the related balance was derecognized from the Company’s consolidated financial statements. (5) Joint Liability Guarantee provided by a Related Party Muhua Shangce has borrowed RMB 3.0 million from a third-party company at an annual interest rate of 4.35% in April 2020, for which the Company’s CEO and Director, Mr. Xiaofeng Ma, has provided a joint liability guarantee. Muhua Shangce was disposed of in June 2021 and the related balance was derecognized from the Company’s consolidated financial statements. (6) Amounts Due to a Company Controlled by a Related Party In November 2020 and May 2021, a partnership controlled by the Company’s CEO and Director, Mr. Xiaofeng Ma provided a ten-month interest-free loan of RMB 500,000 and a fourteen-month interest free loan of RMB 700,000 to Muhua Shangce respectively. The outstanding balance was RMB500,000 as of December 31, 2020. Muhua Shangce was disposed of in June 2021 and the related balance of RMB1,200,000 before the disposal was derecognized from the Company’s consolidated financial statements. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2023 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | (20) COMMITMENTS AND CONTINGENCIES Non-cancellable operating leases As of December 31, 2023, operating lease commitments for property management expenses under lease agreements amounts to RMB 3,747,872. Legal Proceedings In March 2020, Mr. Xiaofeng Ma, our chairman and chief executive officer, received copies of the civil complaints with respect to a lawsuit filed by our two shareholders Alpha Advantage Global Limited (“Alpha”) and Dynamic Fame Limited (“Dynamic”), respectively with the Beijing Fourth Intermediate People’s Court (the “Beijing Intermediate Court”) relating to the Company’s sale of the ATA Online Business. The Company was also listed as a defendant and ATA Online was listed as an interested third party in such lawsuits. Alpha was a holder of 4,529,100 common shares of the Company and Dynamic was a holder of 188,000 common shares of the Company at the time of the completion of the sale of ATA Online Business. The plaintiffs claimed that the sale of the ATA Online Business was a related-party transaction or a self-dealing transaction, for which approval by unrelated shareholders is required and the board of the directors of the Company did not have the right to approve such transaction; the plaintiffs also claimed that the ATA Online Business was worth more than the consideration of US$ 200.0 million paid by the buyer group, and thus the sale of ATA Online Business has caused losses to the plaintiffs as shareholders of the Company. The plaintiffs are requesting that the Beijing Intermediate Court rule that (i) all board resolutions of the Company regarding the sale of the ATA Online Business are invalid; (ii) Mr. Xiaofeng Ma shall compensate the loss incurred by Alpha and Dynamic from the Company’s sale of the ATA Online Business for RMB 95.0 million and RMB 5.0 million, respectively; and (iii) the Company and Mr. Xiaofeng Ma shall jointly bear the attorney’s fees of Alpha and Dynamic for RMB 1.5 million and RMB 0.5 million, respectively, and other litigation costs. The Company filed an application for jurisdiction objection for each of the foregoing two cases, which was not supported by court order. As a result, Beijing Intermediate Court had jurisdiction over these two cases. On March 18, 2022, the Supreme People’s Court issued (2022) Supreme People’s Court Ruling No. 48 and No. 49, holding that these two cases are international commercial cases of great influence and typical significance, and should be tried by the International Commercial Court of the Supreme People’s Court. In accordance with Article 21 and Paragraph 1 of Article 39 of the Civil Procedure Law of the People’s Republic of China and Item 5 of Article 2 of the Provisions of the Supreme People’s Court on Several Issues Concerning the Establishment of International Commercial Courts, the Supreme People’s Court ruled that these two cases should be heard by the Second International Commercial Court of the Supreme People’s Court. As of the date of this annual report, these two cases are still under trial at the Second International Commercial Court of the Supreme People’s Court. In addition, Alpha and Dynamic jointly filed a lawsuit with the Ningbo City Intermediate People’s Court (the “Ningbo Intermediate Court”) against Mr. Xiaofeng Ma, certain entities controlled by management members of ATA Online which were members of the buyer group, New Beauty Holdings Limited, the Company’s director Zhilei Tong, ChineseAll Digital Publishing Group Co., Ltd. and ATA Learning in connection with the Company’s sale of the ATA Online Business, and listed the Company and ATA Online as interested third parties. The plaintiffs are requesting that the Ningbo Intermediate Court rule that (i) all related party transactions between the defendants and the Company relating to the sale of ATA Online Business are invalid; (ii) Mr. Xiaofeng Ma, the entities controlled by the management members of ATA Online and ChineseAll Digital Publishing Group Co., Ltd. shall return the equity interest of ATA Online and ATA Learning they acquired to ATA Learning and ATA BVI, a wholly owned subsidiary of the Company, as the case may be; and (iii) all defendants and the Company shall jointly bear the attorney’s fees of the plaintiffs for RMB 15.0 million and other litigation costs. The case was transferred by the Ningbo Intermediate Court to Beijing Intermediate Court for further proceeding. On January 18, 2023, the Beijing Intermediate Court issued an order of nonsuit which dismissed the case. On February 17, 2023, the plaintiffs appealed such order to Beijing High People’s Court and Beijing High People’s Court later accepted such appeal. As of the date of this annual report, this case is still under trial at Beijing High People’s Court. While the Company does not believe the allegations of the plaintiffs have any merit and intend to vigorously defend against these lawsuits, the Company is currently unable to evaluate the likelihood of favorable or unfavorable outcomes of such lawsuits. The amount of unfavorable outcomes, if any, cannot be reasonably estimated. In accordance with ASC Topic 450, no accrual of loss contingency was accrued as of December 31, 2023. Investment commitments In August 2021, Huanqiuyimeng entered into an agreement with two third parties to invest in a new company, pursuant to which Huanqiuyimeng will invest RMB110.0 million in cash representing 55 % equity interests of the new company. The agreement was subsequently amended in March 2022 and October 2022. Pursuant to the amendments, the capital contribution by Huanqiuyimeng decreased to RMB30.0 million, representing 15% equity interests of the company, while a new investor ATA Learning (Beijing) Inc., a company controlled by Mr. Xiaofeng Kevin Ma, CEO and Chairman of the Group, will invest RMB80.0 million, representing 40 % equity interests in the new company. The capital contribution obligations of Huanqiuyimeng amounting to RMB30.0 million is due on December 31, 2031. As of December 31, 2023, the Group has not made any capital contribution and has a remaining investment commitment of RMB30.0 million. |
EARNINGS (LOSSES) PER COMMON SH
EARNINGS (LOSSES) PER COMMON SHARE | 12 Months Ended |
Dec. 31, 2023 | |
EARNINGS (LOSSES) PER COMMON SHARE | |
EARNINGS (LOSSES) PER COMMON SHARE | (21) EARNINGS (LOSSES) PER COMMON SHARE Basic and diluted losses per common share are calculated as follows: Year ended December 31, 2021 2022 2023 RMB RMB RMB Numerator: Net loss attributable to ATA Creativity Global (33,649,593) (47,892,909) (33,660,245) Redeemable non-controlling interest redemption value accretion (2,283,089) — — Net loss available to common shareholders (35,932,682) (47,892,909) (33,660,245) Denominator: Denominator for basic loss per share: Weighted average common shares outstanding 62,748,095 62,753,840 62,789,811 Denominator for diluted loss per share 62,748,095 62,753,840 62,789,811 Basic loss per common share attributable to ATA Creativity Global (0.57) (0.76) (0.54) Diluted loss per common share attributable to ATA Creativity Global (0.57) (0.76) (0.54) The following table summarizes potential common shares outstanding excluded from the calculation of diluted losses per share for the year ended December 31, 2021, 2022 and 2023, because their effect is anti-dilutive: Year ended December 31, 2021 2022 2023 Shares issuable under restricted shares and share options 826,832 1,674,492 2,730,129 |
ATA CREATIVITY GLOBAL ("PARENT
ATA CREATIVITY GLOBAL ("PARENT COMPANY") | 12 Months Ended |
Dec. 31, 2023 | |
ATA CREATIVITY GLOBAL ("PARENT COMPANY") | |
ATA CREATIVITY GLOBAL ("PARENT COMPANY") | (22) ATA CREATIVITY GLOBAL (“PARENT COMPANY”) The following presents condensed financial information of the Parent Company only. Condensed Balance Sheets December 31, December 31, December 31, 2022 2023 2023 RMB RMB USD Cash and cash equivalents 1,098,896 1,068,177 150,450 Prepaid expenses and other current assets 4,252 4,272 602 Investments in subsidiaries 144,677,894 115,087,677 16,209,760 Total assets 145,781,042 116,160,126 16,360,812 Accrued expenses and other payables 2,681,709 3,122,258 439,761 Total liabilities 2,681,709 3,122,258 439,761 Common shares 4,720,147 4,730,128 666,225 Treasury shares (8,626,894) (8,201,046) (1,155,093) Additional paid in capital 542,058,092 545,222,465 76,792,978 Accumulated other comprehensive loss (37,003,085) (37,004,507) (5,211,976) Accumulated deficit (358,048,927) (391,709,172) (55,171,083) Total shareholders’ equity 143,099,333 113,037,868 15,921,051 Total liabilities and shareholders’ equity 145,781,042 116,160,126 16,360,812 Condensed Statements of Comprehensive Income (Loss) Year ended December 31, 2021 2022 2023 2023 RMB RMB RMB USD Cost of revenues (90,029) (88,930) (74,827) (10,539) Operating expenses (6,412,398) (6,175,519) (5,141,980) (724,233) Investment loss (5,120,016) (41,635,317) (28,469,235) (4,009,808) Interest income 139 6,861 25,802 3,634 Foreign currency exchange losses, net (45) (4) (5) (1) Loss before income taxes (11,622,349) (47,892,909) (33,660,245) (4,740,947) Income tax expense — — — — Net loss (11,622,349) (47,892,909) (33,660,245) (4,740,947) Other comprehensive income (loss) (135,125) 556,762 (1,422) (200) Comprehensive loss (11,757,474) (47,336,147) (33,661,667) (4,741,147) Condensed Statements of Cash Flows Year ended December 31, 2021 2022 2023 2023 RMB RMB RMB USD Net cash used in operating activities (4,529,860) (4,509,052) (1,637,065) (230,576) Cash flows from investing activities: Cash received from subsidiaries 4,113,412 3,159,503 2,546,883 358,721 Cash lent to subsidiaries (9,692) (101,614) (1,437,720) (202,499) Net cash provided by investing activities 4,103,720 3,057,889 1,109,163 156,222 Cash flows from financing activities: Cash received for exercise of share options 232,245 218,943 471,765 66,448 Net cash provided by financing activities 232,245 218,943 471,765 66,448 Effect of foreign exchange rate changes on cash (57,011) 95,386 25,418 3,580 Net decrease in cash (250,906) (1,136,834) (30,719) (4,326) Cash and cash equivalents at beginning of year 2,486,636 2,235,730 1,098,896 154,776 Cash and cash equivalents at end of year 2,235,730 1,098,896 1,068,177 150,450 |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Principles of consolidation | (a) Principles of consolidation The consolidated financial statements include the financial statements of the Company and its subsidiaries, in which ACG, directly or indirectly, has a controlling financial interest and its variable interest entity and its subsidiary, or the consolidated VIE for which the Company is the primary beneficiary. All significant intercompany balances and transactions have been eliminated upon consolidation. Non-redeemable non-controlling interests are separately presented as a component of equity in the consolidated financial statements. |
Basis of presentation | (b) Basis of presentation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). |
Use of estimates | (c) Use of estimates The preparation of financial statements in conformity with U.S. GAAP requires management of the Group to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Such estimates include the fair value determinations of identifiable assets acquired and liabilities assumed, the fair values of share-based payments and other equity investments, the collectability of loan receivable and other receivables, the realizability of deferred income tax assets, the estimate for useful lives and residual values of long-lived assets, the recoverability of long-lived assets, goodwill and long-term investments, determination of estimated stand-alone selling prices of performance obligations, variable consideration and measurement of progress towards completion in revenue recognition. Actual results could differ from those estimates. The current economic environment has increased the degree of uncertainty inherent in those estimates and assumptions. |
Foreign currency | (d) Foreign currency The accompanying consolidated financial statements have been expressed in RMB, the Company’s reporting currency. The Company, ATA Testing Authority (Holdings) Limited (“ATA BVI”), ATA Creativity Global (Hong Kong) Limited (“ACG HK”) (formerly known as Xing Wei Institute (Hong Kong) Limited (“Xing Wei”) and ACG International Group Limited (“ACGIGL”)’s functional currency is USD. The functional currency of the Company’s PRC subsidiaries, VIE and VIE’s subsidiary is RMB. 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 foreign currencies are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting foreign exchange gains and losses are included in the consolidated statements of comprehensive income (loss) in the line item “ Foreign currency exchange gains (losses), net Assets and liabilities of the Company, ATA BVI, ACG HK and ACGIGL are translated into RMB using the applicable exchange rate at each balance sheet date. Revenues and expenses are translated into RMB at average rates prevailing during the year. Equity accounts other than retained earnings (accumulated deficit) generated in the current period are translated into RMB using the appropriate historical rates. The resulting foreign currency translation adjustments are recognized as a separate component of accumulated other comprehensive income (loss) within equity. Since RMB is not a fully convertible currency, all foreign exchange transactions involving RMB must take place either through the People’s Bank of China (the “PBOC”) or other institutions authorized to buy and sell foreign exchange. The exchange rates adopted for the foreign exchange transactions are the rates of exchange quoted by the PBOC. For the convenience of the readers, the 2023 RMB amounts included in the accompanying consolidated financial statements have been translated into USD at the rate of USD 1.00 = RMB 7.0999, the noon buying rate in New York cable transfers of RMB per USD as set forth in the H.10 weekly statistical release of Federal Reserve Board, as of December 31, 2023. No representation is made that the RMB amounts could have been, or could be, converted into USD at that rate or at any other rate on December 31, 2023. |
Commitments and contingencies | (e) Commitments and contingencies In the normal course of business, the Group is subject to contingencies, such as legal proceedings and claims that cover a wide range of matters. Liabilities for such contingencies are recorded when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated. If a potential material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material, is disclosed. |
Fair value measurements | (f) Fair value measurements The Group utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible. The Group determines fair value based on assumptions that market participants would use in pricing an asset or liability in an orderly transaction and principal or most advantageous market. When considering market participant assumptions in fair value measurements, the following fair value hierarchy distinguishes between observable and unobservable inputs, which are categorized in one of the following levels: · · · The level in the fair value hierarchy within which a fair value measurement in its entirety falls is based on the lowest level input that is significant to the fair value measurement in its entirety. In situations where there is little, if any, market activity for the asset or liability at the measurement date, the fair value measurement reflects management’s own judgments about the assumptions that market participants would use in pricing the asset or liability. Those judgments are developed by management based on the best information available in the circumstances. |
Revenue recognition | (g) Revenue recognition The Group’s revenue is primarily generated from portfolio training services, research-based learning services, overseas study counselling services and other educational services through its training centers in China. Revenue is recognized net of Value Added Tax (“VAT”). VAT collected from customers, net of VAT paid for purchases, is recorded as a liability in the consolidated balance sheets until paid to the tax authorities. The Group recognizes revenues upon the satisfaction of its performance obligation (upon transfer of control of promised goods or services to customers) in an amount that reflects the consideration to which the Group expects to be entitled to in exchange for those goods or services, excluding amounts collected on behalf of third parties (for example, value added taxes). The transaction price includes variable consideration where the Company’s performance may result in full or partial return of the service fees based on the final outcome of the performance targets. The Company estimates the transaction price at contract inception based on expected value method, which the Company believes to be better predict with the amount of consideration to which it will be entitled in the contract. In making the estimate of variable consideration, the Company applies judgments which are inherently subjective. This includes the assessment of the final outcome of the performance targets and its historical experience and performance. The amount of estimated variable consideration included in the transaction price is limited only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable condition is subsequently resolved. Management reviews these estimates on a regular basis. Any changes in these factors which affect the estimated variable consideration and revenue recognized are applied prospectively. For each performance obligation satisfied over time, the Group recognizes revenue over time by measuring the progress toward complete satisfaction of that performance obligation. If the Group does not satisfy a performance obligation over time, the performance obligation is satisfied at a point in time. The Group’s contracts with customers also include promises to transfer multiple services. For these contracts, the Group accounts for individual performance obligations separately if they are capable of being distinct and distinct within the context of the contract. Determining whether products and services are distinct performance obligations may require significant judgment. Judgment is also required to determine the stand-alone selling price (“SSP”) for each distinct performance obligation. In instances where SSP is not directly observable, such as when the Group does not sell the product or service separately, the Group determines the SSP using information that may include market conditions and other observable inputs. For these contracts with variable consideration, the Group determines that variable consideration is allocated according to the method as described above, because variable consideration is attributable to all of the performance obligations in a contract. i) Portfolio training services Portfolio training services primarily consist of one-on-one or small-group training at the training centers or online platform in which the teachers provide guidance to students to practice observational drawing or other forms of art work and finally compile the selected pieces to form a portfolio. Individual students select to enroll either in time-based program in which they can take a pre-determined number of hours of training or in a project-based program in which they are guided to complete a portfolio that usually consists of three to five art projects. Revenue is recognized over a period of time based on the number of training hours expended and total hours of training under the contract with the student since the individual student simultaneously receives and consumes the benefits of the portfolio training services as the Group performs. Under project-based programs, the number of hours of training required to complete a project is not pre-determined and varies depending on the background and requirements of individual student. The Group reassesses the total hours of training pursuant to each contract of project-based program with individual student on a quarterly basis. Any adjustments arising from the changes of estimated training hours are applied prospectively. ii) Research-based learning services (formerly known as the educational travel services) The Group provides educational travel services for individual students to bring them art-related experience by providing integration of both travel and study activities in each educational service contract according to the background of individual students. While the educational travel services have been significantly impacted by the coronavirus disease (“COVID-19”), starting in year 2020, the Group introduced new services under the “research-based learning services”, which mainly consist of domestic educational travel services, academic educational learning services, workshop experience services and transferrable credit courses. Revenue is recognized when control of the promised services is transferred to customers in an amount of consideration which the Group expects to be entitled to in exchange for those services. iii) Overseas study counselling services The Group provides overseas study counselling services to students who intend to study abroad on the following aspects, including but not limited to, customized timetable for applicants, university and program selection, developing paperwork for applications, interview simulation and enrollment documents preparation. The Group provides integration and customization of the promised services in each overseas study counselling service contract depending on the background and requirements of the students and aims to deliver a combined output for counselling service to cover both academic and practical aspects during the entire process of application. The promised services are highly interdependent and interrelated and are accounted as one performance obligation, as the promised services in a contract are not distinct within the context of the contract. Since the students simultaneously receive and consume the benefits of these services throughout the service period as the Group performs, the Group recognizes revenue over the counselling service period on the basis of costs incurred to-date to the total estimated costs. iv) Other educational services Other educational services mainly consist of language training services, junior art education services and in-school classes The Group recognizes revenues from the other educational services proportionately when the services are delivered. v) K-12 education assessment and other services The Group derives revenues by providing the assessment reports for the test takers to customers. Revenues from education assessment services are recognized when the Group delivers the reports to customers, which is when the control over the report has been transferred to customers. Fees received in advance are recorded as deferred revenue when the Group has an obligation to transfer goods or services to a customer for which the Group has received consideration. The Group derives content development revenue by designing test model and providing the developed content to customers. Revenues from content development are recognized when the Group delivers the developed content to customers, which is when the control over the content has been transferred to customers. Revenues under this category were mainly contributed by the legacy business from our prior subsidiary of Muhua Shangce Learning Data & Technology (Beijing) Limited (“Muhua Shangce”), whose equity interests was fully disposed on June 2, 2021 in order to focus on our core business of international education. See Note 14. |
Contract cost | (h) Contract cost Sales commissions to sales personnel and third-party agents, and incentives to existing students for referred customers are accounted for as incremental cost of obtaining sales contracts from customers and are initially recognized as an amortizable asset in other non-current assets. Contract cost assets are amortized on the basis consistent with the pattern of the transfer of services to which the assets relate and are included in “sales and marketing expenses” in the consolidated statements of comprehensive income (loss). The amortization expenses of contract cost assets were RMB14,244,301 , RMB 18,470,625, and RMB 22,080,933 for the years ended December 31, 2021, 2022 and 2023, respectively. |
Cost of revenues | (i) Cost of revenues Cost of revenues primarily consist of (1) teaching fees, payroll compensation for teaching support and administrative staff from the training centers, performance-linked bonuses paid to teachers, rental payments for training centers, as well as costs of course materials and teaching aids for portfolio training services, (2) payroll compensation, outsourcing service costs, lodging and transportation expenses, overseas expenses, and other related costs which are directly attributable to the provision of research-based learning services and overseas study counselling services, and (3) teaching fees, payroll compensation, content development costs, and other related costs, which are directly attributable to the rendering of other educational services and K-12 education assessment and other services. |
Research and development costs | (j) Research and development costs Research and development costs primarily consist of salaries and benefits for the Group’s research and development personnel, outsourcing services costs and other costs relating to the design, development, testing and enhancement of the technology systems in support for the rendering of the Group’s products and services. Research and development costs are expensed as incurred. Research and development cost incurred over software developed was primarily for internal use and treated as follows. The Group expenses all costs that are incurred in connection with the planning and implementation phases of the development of software. Costs incurred in the development phase are capitalized and amortized over the estimated product life. No costs were capitalized for any of the periods presented. |
Lease | (k) Lease The Group is a lessee in a number of non-cancellable operating leases, primarily for training center and office spaces. The Group accounts for leases in accordance with ASC Topic 842, Leases For operating leases, the lease liability is initially and subsequently measured at the present value of the unpaid lease payments at the lease commencement date. Key estimates and judgments include how the Group determines (1) the discount rate it uses to discount the unpaid lease payments to present value, (2) lease term and (3) lease payments. · ASC 842 requires a lessee to discount its unpaid lease payments using the interest rate implicit in the lease or, if that rate cannot be readily determined, its incremental borrowing rate. Generally, the Group cannot determine the interest rate implicit in the lease because it does not have access to the lessor’s estimated residual value or the amount of the lessor’s deferred initial direct costs. Therefore, the Group generally uses its incremental borrowing rate as the discount rate for the lease. The Group’s incremental borrowing rate for a lease is the rate of interest it would have to pay on a collateralized basis to borrow an amount equal to the lease payments under similar terms. Because the Group does not generally borrow on a collateralized basis, it uses the interest rate it pays on its non-collateralized borrowings as an input to deriving an appropriate incremental borrowing rate, adjusted for the amount of the lease payments, the lease term and the effect on that rate of designating specific collateral with a value equal to the unpaid lease payments for that lease. · Lease payments included in the measurement of the lease liability are comprised of fixed payments, including in-substance fixed payments, owed over the lease term, which includes termination. The ROU asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for lease payments made at or before the lease commencement date, plus any initial direct costs incurred less any lease incentives received. The leases entered into within the Group do not incur initial direct costs or lease incentives. For operating leases, the ROU asset is subsequently measured throughout the lease term at the carrying amount of the lease liability, plus unamortized initial direct costs, plus (minus) any prepaid (accrued) lease payments, less the unamortized balance of lease incentives received. Lease cost is recognized on a straight-line basis over the lease term. Variable lease payments associated with the Group’s leases are recognized when the event, activity, or circumstance in the lease agreement on which those payments are assessed occurs. Variable lease payments are presented as operating expense in the Group’s consolidated statements of comprehensive income (loss) in the same line item as expense arising from fixed lease payments for operating leases. ROU assets for operating lease are periodically reduced by impairment losses. The Group uses the long-lived assets impairment guidance in ASC Subtopic 360-10, Property, Plant, and Equipment – Overall The Group monitors for events or changes in circumstances that require reassessment of its leases. When a reassessment results in the re-measurement of a lease liability, a corresponding adjustment is made to the carrying amount of the corresponding ROU asset unless doing so would reduce the carrying amount of the ROU asset to an amount less than zero. In that case, the amount of the adjustment that would result in a negative ROU asset balance is recorded in profit or loss. Operating lease ROU assets are presented as operating lease right of use assets on the consolidated balance sheet. The current portion of operating lease liabilities is included in lease liabilities-current and the long-term portion is presented separately as lease liabilities-non-current on the consolidated balance sheets. The Group has elected not to recognize ROU assets and lease liabilities for short-term leases of training centers and offices that have a lease term of 12 months or less. The Group recognizes the lease payments associated with its short-term training centers and offices leases as an expense on a straight-line basis over the lease term. As of December 31, 2022 and 2023, the Company did not have any finance leases. |
Income taxes | (l) Income taxes Income taxes are accounted for under the asset and liability method. Under this method, deferred income tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and tax loss carry forwards. Deferred income 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 income tax assets and liabilities of a change in tax rates or tax status is recognized in income in the period that includes the enactment date or the date of change in tax status. A valuation allowance is provided to reduce the amount of deferred income tax assets if it is considered more likely than not that some portion or all of the deferred income tax assets will not be realized. A deferred tax liability is not recognized for the excess of the Company’s financial statement carrying amount over the tax basis of its investment in a foreign subsidiary, if there exists specific plans for reinvestment of undistributed earnings of a subsidiary which demonstrates that remittance of the earnings will be postponed indefinitely. The Group recognizes in the consolidated financial statements the impact of a tax position, if that position is more likely than not of being sustained upon examination, based on the technical merits of the position. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Group’s accounting policy is to accrue interest and penalties related to unrecognized tax benefits, if and when required, as interest expense and a component of general and administrative expenses, respectively in the consolidated statements of comprehensive income (loss). |
Share-based payment | (m) Share-based payment The Group measures the cost of employee share options and non-vested shares based on the grant date fair value of the award and recognizes that cost over the period during which an employee is required to provide services in exchange for the award, which generally is the vesting period. For the graded vesting share options and non-vested shares, the Company recognizes the compensation cost over the requisite service period for each separately vesting portion of the award as if the award is, in substance, multiple awards. When no future services are required to be performed by the employee in exchange for an award of equity instruments, and if such award does not contain a performance or market condition, the cost of the award is expensed on the grant date. Awards granted to employees with performance conditions are measured at fair value on the grant date and are recognized as compensation expenses in the period and thereafter when the performance goal becomes probable to achieve. We elect to recognize the effect of forfeitures as compensation cost when they occur. To the extent the required vesting conditions are not met which leads to the forfeiture of the share-based awards, previously recognized compensation expenses relating to such awards will be reversed. When there is a modification of the terms and conditions of an award of equity instruments, the Group calculates the incremental compensation cost of a modification as the excess of the fair value of the modified award over the fair value of the original award immediately before its terms are modified, measured based on the share price and other pertinent factors at the modification date. For vested options, the Group recognizes incremental compensation cost in the period the modification occurred. For unvested options, the Group recognizes, over the remaining requisite service period, the sum of the incremental compensation cost and the remaining unrecognized compensation cost for the original award on the modification date. Cancellations in the vesting period are treated as an acceleration of vesting, and recognized immediately for the amount that would otherwise be recognized for services over the vesting period. When there is a change in the grantee status from an employee to a non-employee, if grantee retains the awards on a change in status and continues to provide substantive services to the Group, the change in status results in a new measurement date for the unvested awards with compensation costs measured as if the awards were newly issued to the grantee on the date of the change in status. If grantee retains the awards on a change in status and is not required to provide substantive services to the grantor subsequent to that change in status, the change in status is, in substance, an acceleration of the vesting of the arrangement. |
Cash and cash equivalents | (n) Cash and cash equivalents Cash and cash equivalents consist of cash on hand, cash in banks and highly liquid investments with original maturity less than three months and readily convertible to known amount of cash. |
Accounts receivable | (o) Accounts receivable Accounts receivable are recognized at invoiced amounts, less an allowance for uncollectible accounts, if any. In connection with the adoption of ASC 326 Financial Instruments-Credit Losses |
Long-term investments | (p) Long-term investments Equity method investments The Group applies the equity method to account for an equity interest in an investee over which the Group has significant influence but does not own a majority equity interest or otherwise control. Under the equity method of accounting, the Group’s share of the investee’s results of operations is reported as investment income (loss) in the consolidated statements of comprehensive income (loss). The Group recognizes an impairment loss when there is a decline in value below the carrying value of the equity method investment that is considered to be other than temporary. The process of assessing and determining whether impairment on an investment is other than temporary requires a significant amount of judgment. To determine whether an impairment is other than temporary, management considers whether it has the ability and intent to hold the investment until recovery and whether evidence indicating the carrying value of the investment is recoverable outweighs evidence to the contrary. Evidence considered in this assessment includes the reasons for the impairment, the severity and duration of the decline in value, any change in value subsequent to the period end, and forecasted performance of the investee. Other equity investments In connection with the adoption of ASC321 Investment—Equity Securities The Group makes a qualitative assessment considering impairment indicators to evaluate whether the equity investments without a readily determinable fair value is impaired at each reporting period, and write down to its fair value if a qualitative assessment indicates that the investment is impaired and the fair value of the investment is less than its carrying value. If an equity security without a readily determinable fair value is impaired, the Group includes an impairment loss in net income equal to the difference between the fair value of the investment and its carrying amount. |
Property and equipment, net | (q) Property and equipment, net Property and equipment is stated at historical cost. Depreciation is recognized over the following useful lives in straight-line method, taking into consideration the assets’ estimated salvage value: Building 30 years Computer equipment 3 to 5 years Furniture, fixtures and office equipment 3 to 5 years Software 3 to 10 years Motor vehicles 5 years Leasehold improvements The shorter of lease terms and estimated useful lives Ordinary maintenance and repairs are charged to expenses as incurred, while replacements and betterments are capitalized. When items are retired or otherwise disposed of, income is charged or credited for the difference between net book value of the item disposed and proceeds realized thereon. |
Intangible assets | (r) Intangible assets Intangible assets mainly consist of externally acquired intangible assets resulting from the acquisitions of entities and accounted for using the acquisition method of accounting, which are estimated by management based on the fair value of assets acquired at the acquisition date. Intangible assets are amortized on a straight-line basis over their respective estimated useful lives, which range from 1 to 10 years. The Group has no intangible assets with indefinite useful lives. |
Impairment of long-lived assets, excluding goodwill | (s) Impairment of long-lived assets, excluding goodwill Long-lived assets, including property and equipment, intangible assets, other non-current assets subject to amortization and right-of-use assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require a long-lived asset or asset group be tested for possible impairment, the Group first compares undiscounted cash flows expected to be generated by that asset or asset group to its carrying value. If the carrying value of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent that the carrying value exceeds its fair value. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. |
Goodwill | (t) Goodwill In connection with the adoption of ASU 2017-04, Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment |
Employee benefit plans | (u) Employee benefit plans As stipulated by the regulations of the PRC, the Company’s PRC subsidiaries are required to contribute to various defined contribution plans, organized by municipal and provincial governments on behalf of their employees. The contributions to these plans are based on certain percentages of the employee’s standard salary base as determined by the local Social Security Bureau. The Group has no other obligation for the payment of employee benefits associated with these plans beyond the annual contributions described above. Employee benefit expenses recognized under these plans for the years ended December 31, 2021, 2022 and 2023 are allocated to the following expense items. Year Ended December 31, 2021 2022 2023 RMB RMB RMB Cost of revenues 5,989,994 6,780,226 7,161,205 Research and development 1,294,439 316,293 294,859 Sales and marketing 3,775,110 4,199,996 4,033,438 General and administrative 3,810,984 3,742,289 3,405,996 Total expense due to employee benefit plans 14,870,527 15,038,804 14,895,498 |
Earnings (losses) per share | (v) Earnings (losses) per share Basic earnings (losses) per share is computed by dividing net income (losses), considering the accretions to redemption value of the redeemable non-controlling interests, by the weighted average number of common shares outstanding during the year using the two-class method. Under the two-class method, any net income (losses) is allocated between common shares and other participating securities based on their participating rights in undistributed earnings (losses). Net losses are not allocated to participating securities when the participating securities does not have contractual obligation to share losses. The Company’s certain non-vested shares relating to the share-based awards under the share incentive plan were considered participating securities since the holders of these securities have non-forfeitable rights to dividends or dividend equivalents (whether paid or unpaid). The non-vested shares do not have a contractual obligation to fund or otherwise absorb the Group’s losses. Accordingly, any net income is allocated on a pro rata basis to the common shares and the non-vested shares that were considered participating securities, whereas net loss is allocated to common shares only. Diluted earnings (losses) per share is calculated by dividing net income (losses) adjusted for the effect of dilutive common equivalent shares, if any, by the weighted average number of common and dilutive common equivalent shares outstanding during the year. Common equivalent shares consist of common shares issuable upon vesting of the non-vested shares or exercise of outstanding share options (using the treasury stock method). Common equivalent shares are not included in the denominator of the diluted earnings (losses) per share computation when inclusion of such shares would be anti-dilutive. The Group uses net loss as the control number in determining whether the potential common shares are dilutive or anti-dilutive. |
Segment reporting | (w) Segment reporting The Group’s chief operating decision maker has been identified as the Chief Executive Officer who reviews financial information of operating segments based on US GAAP amounts when making decisions about allocating resources and assessing performance of the Group. The Group uses the management approach in determining operating segments. The management approach considers the internal reporting used by the chief operating decision maker for making operating decisions about the allocation of resources and the assessment of performance in determining the Group’s operating segments. The Group classified the operating segments for the years ended December 31, 2021, 2022 and 2023 into (i) Overseas art study services (ii) Other educational services and (iii) K-12 education assessment and other services. Substantially all of the Group’s operations, customers and long-lived assets are located in the PRC. Consequently, no geographic information is presented. |
Business combination | (x) Business combination Business combinations are recorded using the acquisition method of accounting in accordance with ASC topic 805 (“ASC 805”): Business Combinations . The acquisition method of accounting requires an acquirer to determine the identifiable acquired assets, the liabilities assumed and any non-controlling interest in the acquiree at the acquisition date, measured at their fair values as of that date. The consideration transferred for an acquisition is measured as the aggregate of the fair values at the date of exchange of the assets given, liabilities assumed, equity instruments issued as well as the contingent considerations as of the acquisition date. The costs directly attributable to the acquisition are expensed as incurred. Identifiable assets, liabilities and contingent liabilities acquired or assumed are measured separately at their fair value as of the acquisition date, irrespective of the extent of any non-controlling interests. The excess of (i) the total cost of the acquisition, fair value of the non-controlling interests and acquisition date fair value of any previously held equity interest in the acquiree over (ii) the fair value of the identifiable net assets of the acquiree, is recorded as goodwill. If the cost of the acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognized directly in earnings. |
Recently adopted accounting standards | (y) Recent accounting pronouncements In September 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The FASB is issuing the amendments to enhance the transparency and decision usefulness of income tax disclosures. Investors currently rely on the rate reconciliation table and other disclosures, including total income taxes paid, to evaluate income tax risks and opportunities. While investors find these disclosures helpful, they suggested possible enhancements to better (1) understand an entity’s exposure to potential changes in jurisdictional tax legislation and the ensuing risks and opportunities, (2) assess income tax information that affects cash flow forecasts and capital allocation decisions, and (3) identify potential opportunities to increase future cash flows. The FASB decided that the amendments should be effective for public business entities for annual periods beginning after December 15, 2024. Early adoption is permitted. The adoption of this guidance did not have a material impact on the Company’s financial position, results of operations and cash flows. In July 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The amendments in ASU 2023-07 improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The amendments in ASU 2023-07 improve financial reporting by requiring disclosure of incremental segment information on an annual and interim basis for all public entities to enable investors to develop more decision-useful financial analyses. The amendments are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. The adoption of this guidance did not have a material impact on the Company’s financial position, results of operations and cash flows. |
DESCRIPTION OF BUSINESS, ORGA_2
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | |
Schedule of Assets and Liabilities Information of Group's VIE and Net Revenues, Net Loss and Cash Flows | December 31, December 31, 2022 2023 RMB RMB Cash 159,882 257,218 Prepaid expenses and other current assets 6,592 6,592 Total current assets 166,474 263,810 Long-term investments (i) 55,779,696 49,003,096 Other non-current assets 2,590 12,590 Total assets 55,948,760 49,279,496 Accrued expenses and other payables 134,604 60,587 Amounts due to related parties (ii) 63,597,353 64,617,353 Total current liabilities 63,731,957 64,677,940 Total liabilities 63,731,957 64,677,940 Year ended December 31, 2021 2022 2023 RMB RMB RMB Net revenues — — — Net loss (14,072,212) (7,824,115) (7,615,247) Year ended December 31, 2021 2022 2023 RMB RMB RMB Net cash used in operating activities (903,343) (861,350) (952,664) Net cash used in investing activities (4,642,082) — — Net cash provided by financing activities (iii) 5,645,353 830,186 1,050,000 (i) Long-term investments as of December 31, 2022 and 2023 include investment cost and share of losses derived from the 30.96 % equity interests investment in Beijing Huanqiuyimeng Education Consultation Corp. (“Huanqiuyimeng”) in the amount of RMB55,779,696 and RMB49,003,096, respectively, which is eliminated on consolidation. (ii) Amounts due to related parties represent the amounts due to the Company’s subsidiaries, which are eliminated on consolidation. (iii) RMB5,645,353, RMB830,186 and RMB1,050,000 of net cash provided by financing activities for the years ended December 31, 2021, 2022 and 2023 respectively were related to the transactions with the Company’s subsidiaries, which are eliminated on consolidation. |
Credit Concentration Risk | Cash and Cash Equivalents | |
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | |
Schedule of Significant Concentrations and Risks | December 31, December 31, 2022 2023 RMB RMB Financial institutions in the mainland of the PRC — Denominated in Renminbi (“RMB”) 47,841,321 50,134,377 — Denominated in U.S. Dollar (“USD”) 145 147 Total cash balances held at mainland PRC financial institutions 47,841,466 50,134,524 Financial institutions in Hong Kong Special Administrative Region (“HKSAR”) of the PRC — Denominated in Hong Kong Dollar (“HKD”) 2,714 798 — Denominated in USD 7,136,019 10,031,910 Total cash and cash equivalents balances held at HKSAR financial institutions 7,138,733 10,032,708 Total cash and cash equivalents balances held at financial institutions 54,980,199 60,167,232 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Property and Equipment, Net | Building 30 years Computer equipment 3 to 5 years Furniture, fixtures and office equipment 3 to 5 years Software 3 to 10 years Motor vehicles 5 years Leasehold improvements The shorter of lease terms and estimated useful lives |
Employee Benefit Plans | Year Ended December 31, 2021 2022 2023 RMB RMB RMB Cost of revenues 5,989,994 6,780,226 7,161,205 Research and development 1,294,439 316,293 294,859 Sales and marketing 3,775,110 4,199,996 4,033,438 General and administrative 3,810,984 3,742,289 3,405,996 Total expense due to employee benefit plans 14,870,527 15,038,804 14,895,498 |
PREPAID EXPENSES AND OTHER CU_2
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | |
Schedule of Prepaid Expenses and Other Current Assets | December 31, December 31, 2022 2023 RMB RMB VAT-input deductible 565,675 609,416 Income tax refundable 15,488 15,467 Amount due from Beijing Shouyiren (i) — 1,638,583 Prepaid marketing fee 657,764 751,836 Advances to suppliers 761,613 1,932,090 Other current assets 2,429,745 3,094,777 Total prepaid expenses and other current assets 4,430,285 8,042,169 Other current assets primarily consist of rent deposits and prepaid rent expenses. (i) |
LONG-TERM INVESTMENTS (Tables)
LONG-TERM INVESTMENTS (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
LONG-TERM INVESTMENTS | |
Schedule of Other Equity Investments | December 31, December 31, 2022 2023 RMB RMB EEO Group 38,000,000 38,000,000 Total other equity investments 38,000,000 38,000,000 |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
PROPERTY AND EQUIPMENT, NET | |
Schedule of Property and Equipment, Net | December 31, December 31, 2022 2023 RMB RMB Building (i) 53,049,213 53,049,213 Computer equipment 2,842,992 2,729,055 Furniture, fixtures and office equipment 1,620,039 1,686,997 Motor vehicles 1,469,021 1,469,021 Software 1,565,195 1,565,195 Leasehold improvements 8,476,176 5,564,110 69,022,636 66,063,591 Less: accumulated depreciation and amortization (36,261,660) (35,827,606) Property and equipment, net 32,760,976 30,235,985 (i) Huanqiuyimeng entered into a two-year Commercial Loan Facility (the “Facility”) with China Minsheng Bank Beijing Branch. The Facility is pledged by the real estate property owned by ATA Education, see Note 10 for details. |
Schedule of Allocation of Depreciation Expense Recognized | Year ended December 31, 2021 2022 2023 RMB RMB RMB Cost of revenues 397,905 817,643 1,061,367 Research and development 448,414 22,084 26,669 Sales and marketing 7,984 9,674 15,231 General and administrative 4,937,844 4,267,932 3,647,782 Total depreciation expense 5,792,147 5,117,333 4,751,049 |
GOODWILL AND INTANGIBLE ASSET_2
GOODWILL AND INTANGIBLE ASSETS, NET (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
GOODWILL AND INTANGIBLE ASSETS, NET | |
Schedule of Change in the Carrying Amount of Goodwill by Reporting Unit | The change in the carrying amount of goodwill by reporting unit is as follows: Overseas art study Other Educational services Services Consolidate RMB RMB RMB Balance as of December 31, 2021 176,046,647 18,708,316 194,754,963 Add: Acquisition of Youru 1,534,529 — 1,534,529 Balance as of December 31, 2022 and 2023 177,581,176 18,708,316 196,289,492 |
Summary of Company's Intangible Assets | The following table summarizes the Company’s intangible assets, as of December 31, 2022 and 2023. December 31, 2022 Weighted Gross Accumulated Net average carrying amortization carrying amortization amount /deduction Impairment amount period RMB RMB RMB RMB Years Trademark (i) 79,000,000 (26,991,667) — 52,008,333 10 Non-compete arrangements (i) 56,000,000 (31,888,889) — 24,111,111 6 Copyright obtained 240,000 (240,000) — — 1 Total intangible assets 135,240,000 (59,120,556) — 76,119,444 December 31, 2023 Weighted Gross Accumulated Net average carrying amortization carrying amortization amount /deduction Impairment amount period RMB RMB RMB RMB Years Trademark (i) 79,000,000 (34,891,667) — 44,108,333 10 Non-compete arrangements (i) 56,000,000 (41,222,222) — 14,777,778 6 Total intangible assets 135,000,000 (76,113,889) — 58,886,111 |
Summary of Total Amortization Expense Recognized | Total amortization expense recognized for the years ended December 31, 2021, 2022 and 2023 is allocated to the following expense items: Year ended December 31, 2021 2022 2023 RMB RMB RMB Cost of revenues — 240,000 — General and administrative 17,233,333 17,233,333 17,233,333 Total amortization expense 17,233,333 17,473,333 17,233,333 (ii) Trademark and Non-compete arrangements were recorded as a result of the acquisition of Huanqiuyimeng businesses. |
Schedule of Estimated Amortization Expense | As of December 31, 2023, the estimated amortization expense for the next five years is as follows: December 31 RMB 2024 17,233,333 2025 13,344,444 2026 7,900,000 2027 7,900,000 2028 7,900,000 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
LEASES | |
Schedule on Impact of ASC 842 on Consolidated Balance Sheets | The impact of ASC 842 on the consolidated balance sheets as of December 31, 2022 and 2023 was as follows: December 31, December 31, 2022 2023 RMB RMB Operating leases: Right-of-use assets 37,616,541 23,391,247 Lease liabilities-current 16,920,429 13,110,449 Lease liabilities-non-current 19,528,763 9,496,422 |
Summary of Other Information Related to Leases | Other information related to leases is presented below: Year ended December 31, 2021 2022 2023 RMB RMB RMB Supplemental cash flow information: Cash paid for amounts included in measurement of operating leases liabilities 21,478,066 18,669,210 18,077,004 Lease liability arising from obtaining Right-of-use assets 16,132,735 14,628,975 1,709,583 |
Schedule on Maturities of Lease Liabilities under Non-Cancellable Leases | Maturities of lease liabilities under non-cancellable leases as of December 31, 2023 are as follows: Operating leases RMB 2024 13,570,315 2025 8,297,577 2026 1,538,067 2027 707,828 2028 128,696 Thereafter — Total undiscounted lease payments 24,242,483 Less: Imputed interest (1,635,612) Total lease liabilities 22,606,871 |
ACCRUED EXPENSES AND OTHER PA_2
ACCRUED EXPENSES AND OTHER PAYABLES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
ACCRUED EXPENSES AND OTHER PAYABLES | |
Schedule of Accrued Expenses and Other Payables | Accrued expenses and other payables consist of the following: December 31, December 31, 2022 2023 RMB RMB Refund liability* 19,976,189 22,141,880 Accrued payroll and welfare 20,228,470 17,901,640 Accrued test monitoring fees 2,432,153 — Accrued professional services expenses 3,791,413 3,102,467 Income taxes payable 14,834 1,081 Other current liabilities 9,461,451 5,999,035 Total accrued expenses and other payables 55,904,510 49,146,103 |
NET REVENUES (Tables)
NET REVENUES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
NET REVENUES | |
Schedule of Net Revenues | The components of net revenues for the years ended December 31, 2021, 2022 and 2023, are as follows: Year ended December 31, 2021 2022 2023 RMB RMB RMB Portfolio training services 151,433,831 153,136,274 166,448,699 Research-based learning services 5,977,438 3,721,829 6,512,650 Overseas study counselling services 23,623,998 24,974,973 28,993,831 Other educational services 21,174,198 24,657,609 19,663,788 K-12 education assessment and other services — 330,189 — Net Revenues 202,209,465 206,820,874 221,618,968 |
Schedule of Changes in Deferred Revenue | Fiscal year ended December 31, 2022 2023 RMB RMB Balance at the beginning of the period 202,453,092 219,717,574 Cash received in advance, net of VAT 223,388,868 261,312,149 Acquisition of Youru and subsequent movement 1,534,529 (1,336,197) Revenue recognized from opening balance of deferred revenue (113,271,035) (122,951,789) Revenue recognized from deferred revenue arising during the year (88,928,077) (102,430,097) Disposal of equity interests in subsidiaries for deconsolidation (1,609,644) — Change of refund liabilities (3,850,159) (2,165,691) Balance at the end of the period 219,717,574 252,145,949 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
INCOME TAXES | |
Schedule of Loss from Continuing Operations before Income Taxes Generated in Jurisdictions | Year Ended December 31, 2021 2022 2023 RMB RMB RMB Cayman Islands and British Virgin Islands (18,488,181) (7,206,659) (5,467,559) PRC (19,442,469) (47,256,605) (35,026,914) Hong Kong (19,044) (52,351) (27,777) Loss before income taxes (37,949,694) (54,515,615) (40,522,250) |
Schedule of Income Tax Expense (Benefit) | Year Ended December 31, 2021 2022 2023 RMB RMB RMB PRC Current income tax expense 22,781 130,635 1,081 Deferred income tax benefit (1,562,358) (6,052,019) (6,812,790) Total income tax benefit (1,539,577) (5,921,384) (6,811,709) |
Schedule of Difference Between Actual Income Tax Expense and Amount Computed by Applying PRC Statutory Income Tax Rate to Earnings before Income Taxes | Year Ended December 31, 2021 2022 2023 RMB RMB RMB Computed “expected” income tax benefit (9,487,423) (13,628,904) (10,130,563) Increase in valuation allowance 10,531,372 6,084,383 (2,014,183) Entities not subject to income tax 1,691,406 1,429,868 606,823 Non-deductible expenses Entertainment 280,436 192,298 177,509 Share-based compensation 259,993 364,939 767,010 Other non-deductible expenses 3,927,212 1,625,037 4,186,105 Additional deduction of research and development costs (120,598) — — Disposal of equity interests in subsidiaries (8,385,539) (1,577,200) — Other (236,436) (411,805) (404,410) Actual income tax benefit (1,539,577) (5,921,384) (6,811,709) |
Schedule of Components of Deferred Income Tax Assets and Liabilities | December 31, December 31, 2022 2023 RMB RMB Deferred income tax assets: Tax loss carry forwards 34,562,809 38,132,866 Impairment and investment loss of long-term investments 10,598,946 10,598,946 Lease liabilities 9,112,298 5,651,718 Intangible assets and other non-current assets 405,191 — Provision for loan receivable and other receivables 2,927,994 2,927,994 Accrued expenses and other payables 3,652,004 1,781,265 Property and equipment, net 53,301 26,010 Donation 5,000,000 2,500,000 Total gross deferred income tax assets 66,312,543 61,618,799 Less: valuation allowance (51,769,696) (47,255,513) Total deferred income tax assets, net 14,542,847 14,363,286 Deferred income tax liabilities: Intangible assets 19,029,861 14,721,528 Right-of-use assets 8,721,522 5,346,529 Contract cost assets 5,670,767 6,361,742 Total gross deferred income tax liabilities 33,422,150 26,429,799 Net deferred income tax liabilities 18,879,303 12,066,513 |
Summary of Movements of Valuation Allowance | Year Ended December 31, 2021 2022 2023 RMB RMB RMB Balance at the beginning of the period 56,172,945 48,897,848 51,769,696 Additions 10,531,372 6,084,383 (2,014,183) Reduction due to expiration of temporary difference — (2,500,000) (2,500,000) Reduction as a result of deconsolidation of subsidiaries (17,806,469) (712,535) — Balance at the end of the period 48,897,848 51,769,696 47,255,513 |
NON-CONTROLLING INTERESTS (Tabl
NON-CONTROLLING INTERESTS (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
NON-CONTROLLING INTERESTS | |
Summary of Redeemable Non-Controlling Interest Activities | RMB Balance as of December 31, 2020 48,498,368 Less: Comprehensive loss attributable to redeemable non-controlling interests during the period (714,121) Accretion of redeemable non-controlling interests 2,283,089 Balance as of June 2, 2021 50,067,336 |
Summary of Calculation of Company's Disposal Gain | Upon the disposal of Muhua Shangce, the Company recorded a gain amounting to RMB33,542,154 for the year ended December 31, 2021. The calculation of the Company’s disposal gain is included in the following. RMB Cash consideration received from the disposal of Muhua Shangce — Add: Carrying value of redeemable non-controlling interests in Muhua Shangce 25,757,003 Add: Carrying value of non-redeemable non-controlling interests of Muhua Shangce (4,423,059) Subtotal 21,333,944 Less: Carrying value of net liabilities before disposal (12,208,210) Gain from the disposal of Muhua Shangce 33,542,154 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
SEGMENT INFORMATION | |
Summary of Selected Financial Information Relating to Group's Segments | The following table presents selected financial information relating to the Group’s segments: Overseas art study Other educational For the year ended December 31, 2023: services services Others Consolidated RMB RMB RMB RMB Net revenues 201,955,180 19,663,788 — 221,618,968 Operating cost and expenses: Cost of revenues 96,661,054 10,225,877 74,828 106,961,759 Research and development 3,672,094 114,516 843,270 4,629,880 Selling and marketing 73,182,842 5,437,897 116,753 78,737,492 Unallocated corporate expenses* — — — 72,816,606 Total operating cost and expenses 173,515,990 15,778,290 1,034,851 263,145,737 Other operating income, net 30,865 — — 30,865 Income (Loss) from operations 28,470,055 3,885,498 (1,034,851) (41,495,904) Unallocated other income, net 973,654 Loss before income taxes (40,522,250) Overseas art study Other educational For the year ended December 31, 2022: services services Others Consolidated RMB RMB RMB RMB Net revenues 181,833,076 24,657,609 330,189 206,820,874 Operating cost and expenses: Cost of revenues 92,389,567 11,552,359 373,930 104,315,856 Research and development 5,903,055 — 887,736 6,790,791 Selling and marketing 69,398,473 5,736,053 131,200 75,265,726 Unallocated corporate expenses* — — — 77,051,580 Total operating cost and expenses 167,691,095 17,288,412 1,392,866 263,423,953 Other operating income, net — — 16,515 16,515 Income (Loss) from operations 14,141,981 7,369,197 (1,046,162) (56,586,564) Unallocated other income, net 2,070,949 Loss before income taxes (54,515,615) Overseas art study Other educational For the year ended December 31, 2021: services services Others Consolidated RMB RMB RMB RMB Net revenues 181,035,267 21,174,198 — 202,209,465 Operating cost and expenses: Cost of revenues 81,964,815 14,154,713 1,294,387 97,413,915 Research and development 4,176,398 3,148,402 4,476,745 11,801,545 Selling and marketing 60,436,932 5,598,532 113,996 66,149,460 Unallocated corporate expenses* — — — 93,256,046 Total operating cost and expenses 146,578,145 22,901,647 5,885,128 268,620,966 Other operating income, net — — 22,018 22,018 Income (Loss) from operations 34,457,122 (1,727,449) (5,863,110) (66,389,483) Unallocated other income, net 28,439,789 Loss before income taxes (37,949,694) *Unallocated corporate expenses represent the general and administrative expenses for the years ended December 31, 2021, 2022 and 2023. |
SHARE-BASED COMPENSATION (Table
SHARE-BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
SHARE-BASED COMPENSATION | |
Summary of the Share Options Activities | A summary of the share options activities for years ended December 31, 2021, 2022 and 2023: Weighted Weighted Aggregate average remaining Intrinsic Number of exercise contractual Value shares USD years USD Outstanding as of December 31, 2020 827,198 1.01 — — Granted 181,750 0.57 — — Exercised (62,416) 0.58 — — Forfeited (135,700) 0.57 — — Cancelled — — — — Expired — — — — Outstanding as of December 31, 2021 810,832 1.02 — — Granted 797,700 0.99 — — Exercised (53,538) 0.58 — — Forfeited (178,252) 0.97 — — Cancelled — — — — Expired — — — — Outstanding as of December 31, 2022 1,376,742 1.03 — — Granted 587,697 1.07 — — Exercised (113,328) 0.58 — — Forfeited (162,518) 0.57 — — Cancelled — — — — Expired — — — — Outstanding as of December 31, 2023 1,688,593 1.12 — — Vested and expected to vest as of December 31, 2023 1,688,593 1.12 6.04 3,093 Exercisable as of December 31, 2023 1,025,496 1.15 5.82 1,747 |
Schedule of Information Relating to Options Outstanding and Exercisable | Information relating to options outstanding and exercisable as of December 31, 2023 is as follows: Options outstanding as of December 31, 2023 Options exercisable as of December 31, 2023 Exercise Remaining Exercise Remaining Number of Price Contractual Number Price Contractual Shares per Share Life of Shares per Share Life USD Years USD Years 20,000 0.58 4.85 20,000 0.58 4.85 16,800 0.53 5.21 16,800 0.53 5.21 1,274,093 1.26 5.60 849,396 1.26 5.60 172,700 0.57 7.01 89,300 0.57 7.01 200,000 0.79 8.11 50,000 0.79 8.11 5,000 0.48 10.01 1,688,593 1.12 6.04 1,025,496 1.15 5.82 |
Summary of Assumptions Used in the Valuation Model | The Company calculated the fair value of the share options on the grant date, for the years ended December 31, 2021, 2022 and 2023, using the Black-Scholes-Merton pricing valuation model. The assumptions used in the valuation model are summarized as follows: Year Ended December 31, 2021 2022 2023 Expected dividend yield 0 % 0 % 0 % Expected volatility 70 % 67 % 68 % Expected term 5.40 4.17/4.79/6.25 3.58/4.29/5.25 Risk-free interest rate (per annum) 0.90 % 2.08%/2.78%/1.84 % 3.57%/3.68%/4.68 % |
Options | |
SHARE-BASED COMPENSATION | |
Schedule of Compensation Expense Recognized for Non-vested Shares | Compensation expense recognized for share options for the year ended December 31, 2021, 2022 and 2023 is allocated to the following expense items: Year Ended December 31, 2021 2022 2023 RMB RMB RMB Cost of revenues 62,224 59,874 53,104 Research and development 6,944 4,785 — Sales and marketing 6,806 35,546 53,133 General and administrative 476,435 935,582 1,443,900 Total share-based compensation expense 552,409 1,035,787 1,550,137 |
Non-vested shares | |
SHARE-BASED COMPENSATION | |
Schedule of Compensation Expense Recognized for Non-vested Shares | Compensation expense recognized for non-vested shares for the years ended December 31, 2021, 2022 and 2023 is allocated to the following expense items: Year Ended December 31, 2021 2022 2023 RMB RMB RMB Cost of revenues 27,806 29,057 21,722 Research and development 3,692 — — Sales and marketing 11,741 40,655 63,321 General and administrative 444,324 354,256 1,432,861 Total share-based compensation expense 487,563 423,968 1,517,904 |
Summary of the Non-vested Shares Activities | A summary of the non-vested shares activities for the year ended December 31, 2021, 2022 and 2023 is presented below: Weighted average grant Number date fair of shares value USD Outstanding at December 31, 2020 603,088 0.955 Granted 77,500 1.545 Vested (419,752) 1.112 Forfeited (61,500) 1.545 Cancelled — — Outstanding at December 31, 2021 199,336 0.671 Granted 350,500 0.841 Vested (199,336) 0.671 Forfeited (52,750) 0.615 Cancelled — — Outstanding at December 31, 2022 297,750 0.881 Granted 872,500 0.467 Vested (133,950) 0.851 Forfeited (29,250) 0.925 Cancelled — — Outstanding at December 31, 2023 1,007,050 0.525 |
EARNINGS (LOSSES) PER COMMON _2
EARNINGS (LOSSES) PER COMMON SHARE (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
EARNINGS (LOSSES) PER COMMON SHARE | |
Schedule of Basic and Diluted Losses Per Common Share | Basic and diluted losses per common share are calculated as follows: Year ended December 31, 2021 2022 2023 RMB RMB RMB Numerator: Net loss attributable to ATA Creativity Global (33,649,593) (47,892,909) (33,660,245) Redeemable non-controlling interest redemption value accretion (2,283,089) — — Net loss available to common shareholders (35,932,682) (47,892,909) (33,660,245) Denominator: Denominator for basic loss per share: Weighted average common shares outstanding 62,748,095 62,753,840 62,789,811 Denominator for diluted loss per share 62,748,095 62,753,840 62,789,811 Basic loss per common share attributable to ATA Creativity Global (0.57) (0.76) (0.54) Diluted loss per common share attributable to ATA Creativity Global (0.57) (0.76) (0.54) |
Summary of Potential Common Shares Outstanding Excluded From the Calculation of Diluted Earnings (Loss) Per Share | The following table summarizes potential common shares outstanding excluded from the calculation of diluted losses per share for the year ended December 31, 2021, 2022 and 2023, because their effect is anti-dilutive: Year ended December 31, 2021 2022 2023 Shares issuable under restricted shares and share options 826,832 1,674,492 2,730,129 |
ATA CREATIVITY GLOBAL ("PAREN_2
ATA CREATIVITY GLOBAL ("PARENT COMPANY") (Tables) - ATA Creativity Global | 12 Months Ended |
Dec. 31, 2023 | |
Schedule of Condensed Balance Sheets | Condensed Balance Sheets December 31, December 31, December 31, 2022 2023 2023 RMB RMB USD Cash and cash equivalents 1,098,896 1,068,177 150,450 Prepaid expenses and other current assets 4,252 4,272 602 Investments in subsidiaries 144,677,894 115,087,677 16,209,760 Total assets 145,781,042 116,160,126 16,360,812 Accrued expenses and other payables 2,681,709 3,122,258 439,761 Total liabilities 2,681,709 3,122,258 439,761 Common shares 4,720,147 4,730,128 666,225 Treasury shares (8,626,894) (8,201,046) (1,155,093) Additional paid in capital 542,058,092 545,222,465 76,792,978 Accumulated other comprehensive loss (37,003,085) (37,004,507) (5,211,976) Accumulated deficit (358,048,927) (391,709,172) (55,171,083) Total shareholders’ equity 143,099,333 113,037,868 15,921,051 Total liabilities and shareholders’ equity 145,781,042 116,160,126 16,360,812 |
Schedule of Consolidated Income Statement | Condensed Statements of Comprehensive Income (Loss) Year ended December 31, 2021 2022 2023 2023 RMB RMB RMB USD Cost of revenues (90,029) (88,930) (74,827) (10,539) Operating expenses (6,412,398) (6,175,519) (5,141,980) (724,233) Investment loss (5,120,016) (41,635,317) (28,469,235) (4,009,808) Interest income 139 6,861 25,802 3,634 Foreign currency exchange losses, net (45) (4) (5) (1) Loss before income taxes (11,622,349) (47,892,909) (33,660,245) (4,740,947) Income tax expense — — — — Net loss (11,622,349) (47,892,909) (33,660,245) (4,740,947) Other comprehensive income (loss) (135,125) 556,762 (1,422) (200) Comprehensive loss (11,757,474) (47,336,147) (33,661,667) (4,741,147) |
Schedule of Condensed Statements of Cash Flows | Condensed Statements of Cash Flows Year ended December 31, 2021 2022 2023 2023 RMB RMB RMB USD Net cash used in operating activities (4,529,860) (4,509,052) (1,637,065) (230,576) Cash flows from investing activities: Cash received from subsidiaries 4,113,412 3,159,503 2,546,883 358,721 Cash lent to subsidiaries (9,692) (101,614) (1,437,720) (202,499) Net cash provided by investing activities 4,103,720 3,057,889 1,109,163 156,222 Cash flows from financing activities: Cash received for exercise of share options 232,245 218,943 471,765 66,448 Net cash provided by financing activities 232,245 218,943 471,765 66,448 Effect of foreign exchange rate changes on cash (57,011) 95,386 25,418 3,580 Net decrease in cash (250,906) (1,136,834) (30,719) (4,326) Cash and cash equivalents at beginning of year 2,486,636 2,235,730 1,098,896 154,776 Cash and cash equivalents at end of year 2,235,730 1,098,896 1,068,177 150,450 |
DESCRIPTION OF BUSINESS, ORGA_3
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS - Additional Information (Details) - Maximum | Dec. 31, 2023 CNY (¥) |
PRC | |
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | |
Amount insured by government authority | ¥ 500,000 |
HKSAR | |
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | |
Amount insured by government authority | ¥ 500,000 |
DESCRIPTION OF BUSINESS, ORGA_4
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS - VIE Agreements - Additional Information (Details) | 12 Months Ended | |||||||||
Aug. 17, 2020 CNY (¥) | Aug. 12, 2020 | Mar. 15, 2018 CNY (¥) | Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2019 CNY (¥) | Mar. 19, 2019 CNY (¥) | Dec. 28, 2018 CNY (¥) | Mar. 31, 2018 CNY (¥) | |
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | ||||||||||
Assets | ¥ 448,939,143 | $ 63,231,755 | ¥ 474,464,769 | |||||||
ATA Intelligent Learning's nominee shareholders, Mr. Xiaofeng Ma, Mr. Jun Zhang or Mr. Haichang Xiong | ||||||||||
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | ||||||||||
Loan amount | ¥ 10,000,000 | ¥ 50,000,000 | ¥ 10,000,000 | |||||||
Term of loan | 10 years | |||||||||
ATA Intelligent Learning's nominee shareholders, Mr. Xiaofeng Ma, Mr. Jun Zhang or Mr. Haichang Xiong | Loan Agreement On March192019 | ||||||||||
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | ||||||||||
Loan amount | ¥ 40,000,000 | |||||||||
ATA Intelligent Learning's nominee shareholders, Mr. Xiaofeng Ma and Mr. Haichang Xiong | Loan on March 15, 2018 | ||||||||||
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | ||||||||||
Loan amount | ¥ 1,000,000 | |||||||||
ATA Intelligent Learning's nominee shareholders, Mr. Xiaofeng Ma and Mr. Haichang Xiong | Loan on December 28, 2018 | ||||||||||
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | ||||||||||
Loan amount | ¥ 9,000,000 | |||||||||
ATA Intelligent Learning | ||||||||||
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | ||||||||||
Registered capital | ¥ 50,000,000 | |||||||||
Assets | 49,279,496 | ¥ 55,948,760 | ||||||||
ATA Intelligent Learning | Assets Pledged as collateral | ||||||||||
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | ||||||||||
Assets | ¥ 0 | |||||||||
ATA Intelligent Learning | Beijing Zhenwu Technology Development Company Limited | ||||||||||
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | ||||||||||
Legal ownership interest (as a percent) | 70% | |||||||||
ATA Intelligent Learning | ATA Education | ||||||||||
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | ||||||||||
Percentage of equity interest that can be acquired as per exclusive purchase option | 100% | |||||||||
Term of agreement | 30 years | |||||||||
Notice period prior to expiration of agreement | 30 days | |||||||||
ATA Intelligent Learning | ATA Education | Exclusive technical consulting and services agreement | ||||||||||
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | ||||||||||
Automatic renewal term of the agreement | 10 years | |||||||||
Notice period prior to expiration of agreement | 3 months | |||||||||
Mr. Xiaofeng Ma | ATA Intelligent Learning | ||||||||||
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | ||||||||||
Legal ownership interest (as a percent) | 90% | |||||||||
Mr. Xiaofeng Ma | ATA Intelligent Learning | Mr. Ma | Minimum | ||||||||||
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | ||||||||||
Legal ownership | 40% | 40% | 40% | |||||||
Mr. Haichang Xiong | ATA Intelligent Learning's nominee shareholders, Mr. Xiaofeng Ma, Mr. Jun Zhang or Mr. Haichang Xiong | ||||||||||
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | ||||||||||
Repayment of short-term borrowings | ¥ 5,000,000 | |||||||||
Mr. Jun Zhang | ATA Intelligent Learning's nominee shareholders, Mr. Xiaofeng Ma, Mr. Jun Zhang or Mr. Haichang Xiong | ||||||||||
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | ||||||||||
Proceeds from Issuance of Debt | ¥ 5,000,000 | |||||||||
Mr. Jun Zhang | ATA Intelligent Learning | ||||||||||
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | ||||||||||
Legal ownership interest (as a percent) | 10% |
DESCRIPTION OF BUSINESS, ORGA_5
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS - VIE Assets and Liabilities, Net Revenues, Net Loss and Cash Flows (Details) | 12 Months Ended | ||||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | Dec. 31, 2023 USD ($) | |
Financial statement amounts and balances of VIE included in the accompanying consolidated financial statements | |||||
Prepaid expenses and other current assets | ¥ 8,042,169 | ¥ 4,430,285 | $ 1,132,716 | ||
Total current assets | 70,444,891 | 65,262,522 | 9,921,955 | ||
Long-term investments | 38,000,000 | 38,000,000 | 5,352,188 | ||
Other non-current assets | 31,691,417 | 28,415,794 | 4,463,643 | ||
Total assets | 448,939,143 | 474,464,769 | 63,231,755 | ||
Accrued expenses and other payables | 49,146,103 | 55,904,510 | 6,922,083 | ||
Amounts due to related parties | 5,999,035 | 9,461,451 | |||
Total current liabilities | 314,402,501 | 292,542,513 | 44,282,665 | ||
Total liabilities | 335,965,436 | 330,950,579 | $ 47,319,741 | ||
Net revenues | 221,618,968 | $ 31,214,379 | 206,820,874 | ¥ 202,209,465 | |
Net loss | (33,710,541) | (4,748,031) | (48,594,231) | (36,410,117) | |
Net cash used in operating activities | 8,751,473 | 1,232,619 | (14,613,887) | (31,833,685) | |
Net cash used in investing activities | (3,966,486) | (558,668) | (2,490,103) | (10,028,992) | |
Net cash provided by financing activities | 403,439 | $ 56,823 | 188,212 | 827,516 | |
ATA Intelligent Learning | |||||
Financial statement amounts and balances of VIE included in the accompanying consolidated financial statements | |||||
Cash | 257,218 | 159,882 | |||
Prepaid expenses and other current assets | 6,592 | 6,592 | |||
Total current assets | 263,810 | 166,474 | |||
Long-term investments | 49,003,096 | 55,779,696 | |||
Other non-current assets | 12,590 | 2,590 | |||
Total assets | 49,279,496 | 55,948,760 | |||
Accrued expenses and other payables | 60,587 | 134,604 | |||
Amounts due to related parties | 64,617,353 | 63,597,353 | |||
Total current liabilities | 64,677,940 | 63,731,957 | |||
Total liabilities | 64,677,940 | 63,731,957 | |||
Net loss | (7,615,247) | (7,824,115) | (14,072,212) | ||
Net cash used in operating activities | (952,664) | (861,350) | (903,343) | ||
Net cash used in investing activities | (4,642,082) | ||||
Net cash provided by financing activities | ¥ 1,050,000 | ¥ 830,186 | ¥ 5,645,353 |
DESCRIPTION OF BUSINESS, ORGA_6
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS - VIE Assets and Liabilities, Net Revenues, Net Loss and Cash Flows (Parenthetical) (Details) | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | |
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | ||||
Net cash provided by financing activities | ¥ 403,439 | $ 56,823 | ¥ 188,212 | ¥ 827,516 |
ATA Intelligent Learning | ||||
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | ||||
Net cash provided by financing activities | 1,050,000 | 830,186 | 5,645,353 | |
ATA Intelligent Learning | Eliminations | ||||
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | ||||
Net cash provided by financing activities | ¥ 1,050,000 | ¥ 830,186 | ¥ 5,645,353 | |
ATA Intelligent Learning | Huanqiuyimeng | Eliminations | ||||
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | ||||
Percentage of equity interest | 30.96% | 30.96% | ||
Equity interest investment | ¥ 49,003,096 | ¥ 55,779,696 |
DESCRIPTION OF BUSINESS, ORGA_7
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS - Country Risk and Cash Concentration (Details) | Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) |
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | |||
Cash and cash equivalents balances | ¥ 60,167,232 | $ 8,474,377 | ¥ 54,980,199 |
Cash and cash equivalents | Credit concentration risk, customers or financial institutions | |||
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | |||
Cash and cash equivalents balances | 60,167,232 | 54,980,199 | |
Cash and cash equivalents | Credit concentration risk, customers or financial institutions | PRC | |||
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | |||
Cash and cash equivalents balances | 50,134,524 | 47,841,466 | |
Cash and cash equivalents | Credit concentration risk, customers or financial institutions | PRC | Denominated in Renminbi ("RMB") | |||
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | |||
Cash and cash equivalents balances | 50,134,377 | 47,841,321 | |
Cash and cash equivalents | Credit concentration risk, customers or financial institutions | PRC | Denominated in U.S. Dollar ("USD") | |||
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | |||
Cash and cash equivalents balances | 147 | 145 | |
Cash and cash equivalents | Credit concentration risk, customers or financial institutions | HKSAR | |||
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | |||
Cash and cash equivalents balances | 10,032,708 | 7,138,733 | |
Cash and cash equivalents | Credit concentration risk, customers or financial institutions | HKSAR | Denominated in U.S. Dollar ("USD") | |||
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | |||
Cash and cash equivalents balances | 10,031,910 | 7,136,019 | |
Cash and cash equivalents | Credit concentration risk, customers or financial institutions | HKSAR | Denominated in Hong Kong Dollar ("HKD") | |||
DESCRIPTION OF BUSINESS, ORGANIZATION AND SIGNIFICANT CONCENTRATIONS AND RISKS | |||
Cash and cash equivalents balances | ¥ 798 | ¥ 2,714 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Foreign Currency - Additional Information (Details) | Dec. 31, 2023 |
Foreign currency translation and risks | |
Rate for translation of balances of financial statements from RMB to US$ | 7.0999 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Contract Cost - Additional Information (Details) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Contract cost | |||
Amortization expenses of contract cost assets | ¥ 22,080,933 | ¥ 18,470,625 | ¥ 14,244,301 |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Research and Development Costs - Additional Information (Details) | 12 Months Ended |
Dec. 31, 2023 CNY (¥) | |
Software developed for internal use | |
Research and development costs | |
Capitalized costs for the period | ¥ 0 |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Property and Equipment, Net (Details) | Dec. 31, 2023 |
Building | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Useful lives | 30 years |
Computer equipment | Minimum | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Useful lives | 3 years |
Computer equipment | Maximum | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Useful lives | 5 years |
Furniture, fixtures and office equipment | Minimum | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Useful lives | 3 years |
Furniture, fixtures and office equipment | Maximum | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Useful lives | 5 years |
Software | Minimum | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Useful lives | 3 years |
Software | Maximum | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Useful lives | 10 years |
Motor vehicles | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Useful lives | 5 years |
SUMMARY OF SIGNIFICANT ACCOUN_8
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Intangible Assets - Additional Information (Details) | 12 Months Ended |
Dec. 31, 2023 CNY (¥) | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Intangible assets with indefinite useful lives | ¥ 0 |
Minimum | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Estimated useful lives | 1 year |
Maximum | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Estimated useful lives | 10 years |
SUMMARY OF SIGNIFICANT ACCOUN_9
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Employee Benefit Plans (Details) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||
Total expense due to employee benefit plans | ¥ 14,895,498 | ¥ 15,038,804 | ¥ 14,870,527 |
Cost of revenues | |||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||
Total expense due to employee benefit plans | 7,161,205 | 6,780,226 | 5,989,994 |
Research and development | |||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||
Total expense due to employee benefit plans | 294,859 | 316,293 | 1,294,439 |
Sales and marketing | |||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||
Total expense due to employee benefit plans | 4,033,438 | 4,199,996 | 3,775,110 |
General and administrative | |||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||
Total expense due to employee benefit plans | ¥ 3,405,996 | ¥ 3,742,289 | ¥ 3,810,984 |
BUSINESS ACQUISITION - Addition
BUSINESS ACQUISITION - Additional Information (Details) - CNY (¥) | 1 Months Ended | 12 Months Ended | ||
Sep. 30, 2022 | Aug. 31, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | |
BUSINESS ACQUISITION | ||||
Goodwill acquired | ¥ 1,534,529 | |||
Youru | ||||
BUSINESS ACQUISITION | ||||
Goodwill acquired | ¥ 1,534,529 | |||
Jinan Nuobi | ||||
BUSINESS ACQUISITION | ||||
Percentage of equity interest acquired | 100% | |||
Consideration transferred | ¥ 500,000 |
PREPAID EXPENSES AND OTHER CU_3
PREPAID EXPENSES AND OTHER CURRENT ASSETS - (Details) | 12 Months Ended | ||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | |||
VAT-input deductible | ¥ 609,416 | ¥ 565,675 | |
Income tax refundable | 15,467 | 15,488 | |
Amount due from Beijing Shouyiren | 1,638,583 | ||
Prepaid marketing fee | 751,836 | 657,764 | |
Advances to suppliers | 1,932,090 | 761,613 | |
Other current assets | 3,094,777 | 2,429,745 | |
Total prepaid expenses and other current assets | ¥ 8,042,169 | $ 1,132,716 | ¥ 4,430,285 |
Amount due from Beijing Shouyiren, interest rate | 0% |
LONG-TERM INVESTMENTS - Schedul
LONG-TERM INVESTMENTS - Schedule of other equity investments (Details) - CNY (¥) | Dec. 31, 2023 | Dec. 31, 2022 |
EEO Group | ||
Other equity investments | ||
Other equity investments | ¥ 38,000,000 | ¥ 38,000,000 |
LONG-TERM INVESTMENTS - Additio
LONG-TERM INVESTMENTS - Additional Information (Details) | 1 Months Ended | 12 Months Ended | ||||||||||||||
Sep. 30, 2022 CNY (¥) | Jul. 01, 2022 CNY (¥) | Oct. 31, 2022 CNY (¥) | Jan. 31, 2019 CNY (¥) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | Dec. 31, 2020 CNY (¥) | Dec. 31, 2018 CNY (¥) director | Jul. 31, 2022 | Jun. 10, 2022 CNY (¥) | Mar. 30, 2021 | Jul. 31, 2020 | Dec. 31, 2019 CNY (¥) | Jan. 01, 2019 CNY (¥) | Dec. 31, 2018 USD ($) | Dec. 31, 2018 CNY (¥) | |
Beijing Quanouyimeng Culture Communication Co Ltd | ||||||||||||||||
Other equity investments | ||||||||||||||||
Percentage of equity interest acquired | 100% | |||||||||||||||
Debt Instrument Interest Free Loan | ¥ 950,000 | |||||||||||||||
Debt Instrument Loan Payment | ¥ 650,000 | ¥ 300,000 | ||||||||||||||
Equity Interest Sold Percentage | 70% | 70% | ||||||||||||||
Proceeds from Sale of Equity Method Investments | ¥ 0 | |||||||||||||||
Gain On Disposal Of Equity Interest | ¥ 682,996 | ¥ 682,996 | ||||||||||||||
Equity Interest Sold Percentage Remaining | 30% | |||||||||||||||
ApplySquare Education & Technology Co., Ltd. ("ApplySquare") | ||||||||||||||||
Other equity investments | ||||||||||||||||
Percentage of equity interest | 7.95% | 7.95% | ||||||||||||||
Payments to Acquire Equity Method Investments | ¥ 19,721,700 | |||||||||||||||
Total exchange amount | $ | $ 3,000,000 | |||||||||||||||
Carrying amount of investment | ¥ 22,471,700 | |||||||||||||||
Impairment loss recorded | ¥ 20,895,309 | |||||||||||||||
Impairment loss | ¥ 1,576,391 | |||||||||||||||
Beijing Xiaozhi Education & Technology Co., Ltd. (''Xiaozhi Education") | ||||||||||||||||
Other equity investments | ||||||||||||||||
Percentage of equity interest | 20% | 20% | ||||||||||||||
Payments to Acquire Equity Method Investments | ¥ 6,000,000 | |||||||||||||||
Total exchange amount | ¥ 6,000,000 | |||||||||||||||
Impairment loss | ¥ 6,000,000 | |||||||||||||||
Right to number of director | director | 1 | |||||||||||||||
Beijing Futou Technology Co., Ltd. ("Futou Technology") | Huanqiuyimeng | ||||||||||||||||
Other equity investments | ||||||||||||||||
Percentage of equity interest | 15% | |||||||||||||||
Impairment loss | ¥ 150,000 | |||||||||||||||
EEO Group | ||||||||||||||||
Other equity investments | ||||||||||||||||
Percentage of equity interest | 4.822% | 8.33% | 8.33% | |||||||||||||
Total exchange amount | ¥ 38,000,000 | |||||||||||||||
EEO Group | Minimum | ||||||||||||||||
Other equity investments | ||||||||||||||||
Percentage of equity interest | 4.822% | |||||||||||||||
EEO Group | Maximum | ||||||||||||||||
Other equity investments | ||||||||||||||||
Percentage of equity interest | 4.433% |
FAIR VALUE MEASUREMENT (Details
FAIR VALUE MEASUREMENT (Details) - CNY (¥) | 12 Months Ended | |||
Jul. 01, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Beijing Quanouyimeng Culture Communication Co Ltd | ||||
FAIR VALUE MEASUREMENT | ||||
Gain On Disposal Of Equity Interest | ¥ 682,996 | ¥ 682,996 | ||
ApplySquare Education & Technology Co., Ltd. ("ApplySquare") | ||||
FAIR VALUE MEASUREMENT | ||||
Impairment loss recorded | ¥ 1,576,391 | |||
Beijing Futou Technology Co., Ltd. ("Futou Technology") | ||||
FAIR VALUE MEASUREMENT | ||||
Impairment loss recorded | ¥ 150,000 | |||
Beijing Xiaozhi Education & Technology Co., Ltd. (''Xiaozhi Education") | ||||
FAIR VALUE MEASUREMENT | ||||
Impairment loss recorded | ¥ 6,000,000 |
PROPERTY AND EQUIPMENT, NET - S
PROPERTY AND EQUIPMENT, NET - Schedule of property and equipment, net (Details) | 1 Months Ended | |||
May 31, 2022 | Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | |
PROPERTY AND EQUIPMENT, NET | ||||
Property and equipment, gross | ¥ 66,063,591 | ¥ 69,022,636 | ||
Less: accumulated depreciation and amortization | (35,827,606) | (36,261,660) | ||
Property and equipment, net | 30,235,985 | $ 4,258,649 | 32,760,976 | |
Commercial Loan | ||||
PROPERTY AND EQUIPMENT, NET | ||||
Debt instrument term | 2 years | |||
Building | ||||
PROPERTY AND EQUIPMENT, NET | ||||
Property and equipment, gross | 53,049,213 | 53,049,213 | ||
Computer equipment | ||||
PROPERTY AND EQUIPMENT, NET | ||||
Property and equipment, gross | 2,729,055 | 2,842,992 | ||
Furniture, fixtures and office equipment | ||||
PROPERTY AND EQUIPMENT, NET | ||||
Property and equipment, gross | 1,686,997 | 1,620,039 | ||
Motor vehicles | ||||
PROPERTY AND EQUIPMENT, NET | ||||
Property and equipment, gross | 1,469,021 | 1,469,021 | ||
Software | ||||
PROPERTY AND EQUIPMENT, NET | ||||
Property and equipment, gross | 1,565,195 | 1,565,195 | ||
Leasehold improvements | ||||
PROPERTY AND EQUIPMENT, NET | ||||
Property and equipment, gross | ¥ 5,564,110 | ¥ 8,476,176 |
PROPERTY AND EQUIPMENT, NET -_2
PROPERTY AND EQUIPMENT, NET - Schedule of depreciation expense recognition (Details) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
PROPERTY AND EQUIPMENT, NET | |||
Total depreciation expense | ¥ 4,751,049 | ¥ 5,117,333 | ¥ 5,792,147 |
Cost of revenues | |||
PROPERTY AND EQUIPMENT, NET | |||
Total depreciation expense | 1,061,367 | 817,643 | 397,905 |
Research and development | |||
PROPERTY AND EQUIPMENT, NET | |||
Total depreciation expense | 26,669 | 22,084 | 448,414 |
Sales and marketing | |||
PROPERTY AND EQUIPMENT, NET | |||
Total depreciation expense | 15,231 | 9,674 | 7,984 |
General and administrative | |||
PROPERTY AND EQUIPMENT, NET | |||
Total depreciation expense | ¥ 3,647,782 | ¥ 4,267,932 | ¥ 4,937,844 |
GOODWILL AND INTANGIBLE ASSET_3
GOODWILL AND INTANGIBLE ASSETS, NET - Goodwill - Additional Information (Details) | 12 Months Ended | ||||||||
Sep. 30, 2022 CNY (¥) | Aug. 31, 2020 CNY (¥) | Dec. 31, 2023 CNY (¥) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | Dec. 31, 2023 USD ($) | Jul. 31, 2022 CNY (¥) | Jul. 01, 2022 | Dec. 31, 2019 CNY (¥) | |
Goodwill | |||||||||
Goodwill | ¥ 196,289,492 | ¥ 196,289,492 | ¥ 194,754,963 | $ 27,646,797 | |||||
Decrease in goodwill | ¥ 5,723,832 | ||||||||
Goodwill acquired | 1,534,529 | ||||||||
Goodwill impairment | ¥ 0 | ¥ 0 | ¥ 0 | ||||||
Huanqiuyimeng | |||||||||
Goodwill | |||||||||
Percentage of equity interest acquired | 100% | ||||||||
Goodwill | ¥ 200,478,795 | ||||||||
Beijing Quanouyimeng Culture Communication Co Ltd | |||||||||
Goodwill | |||||||||
Percentage of equity interest acquired | 100% | ||||||||
Goodwill | ¥ 0 | ||||||||
Equity interest sold percentage | 70% | 70% | |||||||
Fair value of goodwill | ¥ 0 | ||||||||
Youru | |||||||||
Goodwill | |||||||||
Goodwill acquired | ¥ 1,534,529 |
GOODWILL AND INTANGIBLE ASSET_4
GOODWILL AND INTANGIBLE ASSETS, NET - Schedule of change in the carrying amount of goodwill by reporting unit (Details) | 12 Months Ended | ||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | |
Change in the carrying amount of goodwill | |||
Balance at beginning of the year | ¥ 196,289,492 | ¥ 194,754,963 | |
Add: Acquisition of Youru | 1,534,529 | ||
Balance at end of the year | 196,289,492 | $ 27,646,797 | 196,289,492 |
Overseas art study services | |||
Change in the carrying amount of goodwill | |||
Balance at beginning of the year | 177,581,176 | 176,046,647 | |
Add: Acquisition of Youru | 1,534,529 | ||
Balance at end of the year | 177,581,176 | 177,581,176 | |
Other educational services | |||
Change in the carrying amount of goodwill | |||
Balance at beginning of the year | 18,708,316 | 18,708,316 | |
Add: Acquisition of Youru | |||
Balance at end of the year | ¥ 18,708,316 | ¥ 18,708,316 |
GOODWILL AND INTANGIBLE ASSET_5
GOODWILL AND INTANGIBLE ASSETS, NET - Summary of Company's intangible assets (Details) - CNY (¥) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Intangible assets | ||
Gross carrying amount | ¥ 135,000,000 | ¥ 135,240,000 |
Accumulated amortization/deduction | (76,113,889) | (59,120,556) |
Net carrying amount | 58,886,111 | 76,119,444 |
Trademark | ||
Intangible assets | ||
Gross carrying amount | 79,000,000 | 79,000,000 |
Accumulated amortization/deduction | (34,891,667) | (26,991,667) |
Net carrying amount | ¥ 44,108,333 | ¥ 52,008,333 |
Weighted average amortization period | 10 years | 10 years |
Non-compete arrangements | ||
Intangible assets | ||
Gross carrying amount | ¥ 56,000,000 | ¥ 56,000,000 |
Accumulated amortization/deduction | (41,222,222) | (31,888,889) |
Net carrying amount | ¥ 14,777,778 | ¥ 24,111,111 |
Weighted average amortization period | 6 years | 6 years |
Copyright obtained | ||
Intangible assets | ||
Gross carrying amount | ¥ 240,000 | |
Accumulated amortization/deduction | ¥ (240,000) | |
Weighted average amortization period | 1 year |
GOODWILL AND INTANGIBLE ASSET_6
GOODWILL AND INTANGIBLE ASSETS, NET- Schedule of Total amortization expense recognized (Details) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
GOODWILL AND INTANGIBLE ASSETS, NET | |||
Total amortization expense | ¥ 17,233,333 | ¥ 17,473,333 | ¥ 17,233,333 |
Cost of revenues | |||
GOODWILL AND INTANGIBLE ASSETS, NET | |||
Total amortization expense | 240,000 | ||
General and administrative | |||
GOODWILL AND INTANGIBLE ASSETS, NET | |||
Total amortization expense | ¥ 17,233,333 | ¥ 17,233,333 | ¥ 17,233,333 |
GOODWILL AND INTANGIBLE ASSET_7
GOODWILL AND INTANGIBLE ASSETS, NET - Schedule of estimated amortization expense (Details) | Dec. 31, 2023 CNY (¥) |
Estimated amortization expense | |
2024 | ¥ 17,233,333 |
2025 | 13,344,444 |
2026 | 7,900,000 |
2027 | 7,900,000 |
2028 | ¥ 7,900,000 |
LEASES - Additional Information
LEASES - Additional Information (Details) | 12 Months Ended | ||
Dec. 31, 2023 CNY (¥) lease | Dec. 31, 2022 CNY (¥) lease | Dec. 31, 2021 CNY (¥) | |
LEASES | |||
Number of operating leases | lease | 25 | 29 | |
Weighted average remaining lease term | 2 years 2 months 1 day | 2 years 9 months 14 days | |
Weighted average discount rate | 6.56% | 6.57% | |
Operating lease, rental expense | ¥ 18,600,344 | ¥ 18,456,989 | ¥ 21,599,937 |
Short term lease expense | 3,950,259 | 3,412,129 | 3,248,285 |
Short term lease commitment | 3,146,914 | ||
Variable cost | 0 | 0 | 0 |
Sublease income | ¥ 0 | ¥ 0 | ¥ 0 |
Minimum | |||
LEASES | |||
Operating lease remaining term of contract | 1 month | 1 month | |
Maximum | |||
LEASES | |||
Operating lease remaining term of contract | 54 months | 66 months |
LEASES - Impact of ASC 842 on t
LEASES - Impact of ASC 842 on the consolidated balance sheets (Details) | Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) |
Operating leases: | |||
Right-of-use assets | ¥ 23,391,247 | $ 3,294,588 | ¥ 37,616,541 |
Lease liabilities-current | 13,110,449 | 1,846,568 | 16,920,429 |
Lease liabilities-non-current | ¥ 9,496,422 | $ 1,337,543 | ¥ 19,528,763 |
LEASES - Other information rela
LEASES - Other information related to leases (Details) | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | |
Supplemental cash flow information: | ||||
Cash paid for amounts included in measurement of operating leases liabilities | ¥ 18,077,004 | ¥ 18,669,210 | ¥ 21,478,066 | |
Lease liability arising from obtaining Right-of-use assets | ¥ 1,709,583 | $ 240,790 | ¥ 14,628,975 | ¥ 16,132,735 |
LEASES - Maturities of lease li
LEASES - Maturities of lease liabilities under non-cancellable leases (Details) | Dec. 31, 2023 CNY (¥) |
LEASES | |
2024 | ¥ 13,570,315 |
2025 | 8,297,577 |
2026 | 1,538,067 |
2027 | 707,828 |
2028 | 128,696 |
Thereafter | 0 |
Total undiscounted lease payments | 24,242,483 |
Less: Imputed interest | (1,635,612) |
Total lease liabilities | ¥ 22,606,871 |
SHORT-TERM LOANS (Details)
SHORT-TERM LOANS (Details) - CNY (¥) | 1 Months Ended | 12 Months Ended | |||
May 31, 2022 | Dec. 31, 2023 | Dec. 31, 2021 | Dec. 31, 2020 | Jun. 30, 2021 | |
SHORT-TERM LOANS | |||||
Line Of Credit From Loan Facility Withdrawn | ¥ 0 | ||||
Mr. Xiaofeng Ma | |||||
SHORT-TERM LOANS | |||||
Other short-term borrowings | ¥ 631,000 | ||||
CEO of Muhua Shangce | |||||
SHORT-TERM LOANS | |||||
Other short-term borrowings | ¥ 1,210,000 | 1,260,000 | |||
Loan unpaid amount | ¥ 7,511,000 | ||||
Mr. Xiaofeng Ma | |||||
SHORT-TERM LOANS | |||||
Other short-term borrowings | 500,000 | ||||
Three Third Party Companies | |||||
SHORT-TERM LOANS | |||||
Other short-term borrowings | 900,000 | ||||
CEO of Muhua Shangce and Three Third Party Companies | |||||
SHORT-TERM LOANS | |||||
Repayment of other short-term borrowings | 1,490,000 | ||||
Short-Term Loan | Huanqiuyimeng | |||||
SHORT-TERM LOANS | |||||
Short-term borrowings from bank | 13,327,000 | ||||
4.35% Interest loan | |||||
SHORT-TERM LOANS | |||||
Other short-term borrowings | ¥ 3,000,000 | ||||
Annual interest rate | 4.35% | ||||
2.00% Interest Loan | CEO of Muhua Shangce | |||||
SHORT-TERM LOANS | |||||
Other short-term borrowings | ¥ 500,000 | ||||
Annual interest rate | 2% | ||||
No Interest | CEO of Muhua Shangce | |||||
SHORT-TERM LOANS | |||||
Other short-term borrowings | 1,060,000 | ¥ 760,000 | |||
No Interest | Three Third Party Companies | |||||
SHORT-TERM LOANS | |||||
Other short-term borrowings | ¥ 800,000 | ||||
No Interest | CEO and Director of a Partnership | |||||
SHORT-TERM LOANS | |||||
Debt instrument term | 14 months | ||||
Other short-term borrowings | ¥ 700,000 | ||||
6.12% Interest Loan | CEO of Muhua Shangce | |||||
SHORT-TERM LOANS | |||||
Other short-term borrowings | ¥ 150,000 | ||||
Annual interest rate | 6.12% | ||||
Commercial Loan | |||||
SHORT-TERM LOANS | |||||
Line of credit | ¥ 20,000,000 | ||||
Debt instrument term | 2 years | ||||
Pledge agreement term | 2 years |
ACCRUED EXPENSES AND OTHER PA_3
ACCRUED EXPENSES AND OTHER PAYABLES (Details) | Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) |
ACCRUED EXPENSES AND OTHER PAYABLES | |||
Refund liability | ¥ 22,141,880 | ¥ 19,976,189 | |
Accrued payroll and welfare | 17,901,640 | 20,228,470 | |
Accrued test monitoring fees | 2,432,153 | ||
Accrued professional services expenses | 3,102,467 | 3,791,413 | |
Income taxes payable | 1,081 | 14,834 | |
Other current liabilities | 5,999,035 | 9,461,451 | |
Total accrued expenses and other payables | ¥ 49,146,103 | $ 6,922,083 | ¥ 55,904,510 |
NET REVENUES - Schedule of Net
NET REVENUES - Schedule of Net Revenues (Details) | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | |
NET REVENUES | ||||
Net revenues | ¥ 221,618,968 | $ 31,214,379 | ¥ 206,820,874 | ¥ 202,209,465 |
Portfolio training services | ||||
NET REVENUES | ||||
Net revenues | 166,448,699 | 153,136,274 | 151,433,831 | |
Research-based learning services | ||||
NET REVENUES | ||||
Net revenues | 6,512,650 | 3,721,829 | 5,977,438 | |
Overseas study counselling services | ||||
NET REVENUES | ||||
Net revenues | 28,993,831 | 24,974,973 | 23,623,998 | |
Other educational services | ||||
NET REVENUES | ||||
Net revenues | ¥ 19,663,788 | 24,657,609 | ¥ 21,174,198 | |
K-12 education assessment and other services | ||||
NET REVENUES | ||||
Net revenues | ¥ 330,189 |
NET REVENUES - Schedule of Chan
NET REVENUES - Schedule of Changes in Deferred Revenue (Details) - CNY (¥) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
NET REVENUES | ||
Balance at the beginning of the period | ¥ 219,717,574 | ¥ 202,453,092 |
Cash received in advance, net of VAT | 261,312,149 | 223,388,868 |
Acquisition of Youru and subsequent movement | (1,336,197) | 1,534,529 |
Revenue recognized from opening balance of deferred revenue | (122,951,789) | (113,271,035) |
Revenue recognized from deferred revenue arising during the year | (102,430,097) | (88,928,077) |
Disposal of equity interests in subsidiaries for deconsolidation | (1,609,644) | |
Change of refund liabilities | (2,165,691) | (3,850,159) |
Balance at the end of the period | ¥ 252,145,949 | ¥ 219,717,574 |
INCOME TAXES - Additional Infor
INCOME TAXES - Additional Information (Details) - CNY (¥) | 12 Months Ended | 36 Months Ended | ||||||||||
Jan. 01, 2008 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2019 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2011 | Dec. 31, 2010 | |
INCOME TAXES | ||||||||||||
Statutory income tax rate (as a percent) | 25% | 25% | 25% | |||||||||
Undistributed earnings generated by the PRC consolidated entities | ¥ 1,993,552 | ¥ 2,486,972 | ¥ 2,486,972 | |||||||||
Unrecognized deferred income tax liability | 199,355 | 248,697 | 248,697 | |||||||||
Balance at the end of the period | 47,255,513 | 51,769,696 | ¥ 48,897,848 | 51,769,696 | ||||||||
Additional disclosures | ||||||||||||
Unrecognized tax benefits | 0 | 0 | 0 | ¥ 0 | ||||||||
Interest and penalties recorded | ¥ 0 | ¥ 0 | ¥ 0 | |||||||||
Period of statute of limitations, if the underpayment of taxes is due to computational errors made by the taxpayer or the withholding agent | 3 years | |||||||||||
Period of statute of limitations, if the underpayment is more than RMB 100,000 | 5 years | |||||||||||
Minimum amount of underpayment of taxes for statute of limitations to be extended to five years | ¥ 100,000 | |||||||||||
Period of statute of limitations for transfer pricing issues | 10 years | |||||||||||
PRC | ||||||||||||
INCOME TAXES | ||||||||||||
Statutory income tax rate (as a percent) | 25% | 25% | ||||||||||
Preferential tax rate as a high and new technology enterprise (as a percent) | 15% | |||||||||||
Withholding tax rate for dividends distributed by a PRC-resident enterprise to its immediate holding company outside the PRC (as a percent) | 10% | |||||||||||
Balance at the end of the period | ¥ 47,255,513 | |||||||||||
Tax loss carry forwards for PRC income tax purpose | 152,531,464 | |||||||||||
PRC | December 31, 2024 | ||||||||||||
INCOME TAXES | ||||||||||||
Tax loss carry forwards for PRC income tax purpose | 53,627,996 | |||||||||||
PRC | December 31, 2025 | ||||||||||||
INCOME TAXES | ||||||||||||
Tax loss carry forwards for PRC income tax purpose | 33,091,899 | |||||||||||
PRC | December 31, 2026 | ||||||||||||
INCOME TAXES | ||||||||||||
Tax loss carry forwards for PRC income tax purpose | 20,501,771 | |||||||||||
PRC | December 31, 2027 | ||||||||||||
INCOME TAXES | ||||||||||||
Tax loss carry forwards for PRC income tax purpose | 29,668,060 | |||||||||||
PRC | December 31, 2028 | ||||||||||||
INCOME TAXES | ||||||||||||
Tax loss carry forwards for PRC income tax purpose | ¥ 14,280,230 | |||||||||||
PRC | ATA Education | ||||||||||||
INCOME TAXES | ||||||||||||
Preferential tax rate as a high and new technology enterprise (as a percent) | 15% | 15% | 15% | 15% | 15% | |||||||
PRC | Muhua shangce | ||||||||||||
INCOME TAXES | ||||||||||||
Preferential tax rate as a high and new technology enterprise (as a percent) | 15% | 15% | 15% |
INCOME TAXES - Schedule of Loss
INCOME TAXES - Schedule of Loss from Continuing Operations before Income Taxes Generated in Jurisdictions (Details) | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | |
INCOME TAXES | ||||
Loss before income taxes | ¥ (40,522,250) | $ (5,707,440) | ¥ (54,515,615) | ¥ (37,949,694) |
Cayman Islands and British Virgin Islands | ||||
INCOME TAXES | ||||
Loss before income taxes | (5,467,559) | (7,206,659) | (18,488,181) | |
PRC | ||||
INCOME TAXES | ||||
Loss before income taxes | (35,026,914) | (47,256,605) | (19,442,469) | |
Hong Kong | ||||
INCOME TAXES | ||||
Loss before income taxes | ¥ (27,777) | ¥ (52,351) | ¥ (19,044) |
INCOME TAXES - Schedule of Inco
INCOME TAXES - Schedule of Income Tax Expense (Benefit) (Details) | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | |
INCOME TAXES | ||||
Current income tax expense | ¥ 1,081 | ¥ 130,635 | ¥ 22,781 | |
Deferred income tax benefit | (6,812,790) | (6,052,019) | (1,562,358) | |
Total income tax benefit | ¥ (6,811,709) | $ (959,409) | ¥ (5,921,384) | ¥ (1,539,577) |
INCOME TAXES - Schedule of Diff
INCOME TAXES - Schedule of Difference Between Actual Income Tax Expense and Amount Computed by Applying PRC Statutory Income Tax Rate to Earnings before Income Taxes (Details) | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | |
Difference between actual income tax expense and amount computed by applying the PRC statutory income tax rate to earnings (loss) before income taxes | ||||
Computed "expected" income tax benefit | ¥ (10,130,563) | ¥ (13,628,904) | ¥ (9,487,423) | |
Increase in valuation allowance | (2,014,183) | 6,084,383 | 10,531,372 | |
Entities not subject to income tax | 606,823 | 1,429,868 | 1,691,406 | |
Non-deductible expenses | ||||
Entertainment | 177,509 | 192,298 | 280,436 | |
Share-based compensation | 767,010 | 364,939 | 259,993 | |
Other non-deductible expenses | 4,186,105 | 1,625,037 | 3,927,212 | |
Additional deduction of research and development costs | (120,598) | |||
Other | (404,410) | (411,805) | (236,436) | |
Total income tax benefit | ¥ (6,811,709) | $ (959,409) | (5,921,384) | (1,539,577) |
Muhua shangce | ||||
Non-deductible expenses | ||||
Disposal of equity interests in subsidiaries | ¥ (1,577,200) | ¥ (8,385,539) |
INCOME TAXES - Schedule of Comp
INCOME TAXES - Schedule of Components of Deferred Income Tax Assets and Liabilities (Details) | Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | Dec. 31, 2020 CNY (¥) |
Deferred income tax assets: | |||||
Tax loss carry forwards | ¥ 38,132,866 | ¥ 34,562,809 | |||
Impairment and investment loss of long-term investments | 10,598,946 | 10,598,946 | |||
Lease liabilities | 5,651,718 | 9,112,298 | |||
Intangible assets and other non-current assets | 405,191 | ||||
Provision for loan receivable and other receivables | 2,927,994 | 2,927,994 | |||
Accrued expenses and other payables | 1,781,265 | 3,652,004 | |||
Property and equipment, net | 26,010 | 53,301 | |||
Donation | 2,500,000 | 5,000,000 | |||
Total gross deferred income tax assets | 61,618,799 | 66,312,543 | |||
Less: valuation allowance | (47,255,513) | (51,769,696) | ¥ (48,897,848) | ¥ (56,172,945) | |
Total deferred income tax assets, net | 14,363,286 | 14,542,847 | |||
Deferred income tax liabilities: | |||||
Intangible assets | 14,721,528 | 19,029,861 | |||
Right-of-use assets | 5,346,529 | 8,721,522 | |||
Contract cost assets | 6,361,742 | 5,670,767 | |||
Total gross deferred income tax liabilities | 26,429,799 | 33,422,150 | |||
Net deferred income tax liabilities | ¥ 12,066,513 | $ 1,699,533 | ¥ 18,879,303 |
INCOME TAXES - Summary of Movem
INCOME TAXES - Summary of Movements of Valuation Allowance (Details) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
INCOME TAXES | |||
Balance at the beginning of the period | ¥ 51,769,696 | ¥ 48,897,848 | ¥ 56,172,945 |
Additions | (2,014,183) | 6,084,383 | 10,531,372 |
Reduction due to expiration of temporary difference | (2,500,000) | (2,500,000) | |
Reduction as a result of deconsolidation of subsidiaries | (712,535) | (17,806,469) | |
Balance at the end of the period | ¥ 47,255,513 | ¥ 51,769,696 | ¥ 48,897,848 |
NON-CONTROLLING INTERESTS - Add
NON-CONTROLLING INTERESTS - Additional Information (Details) | 1 Months Ended | 4 Months Ended | 12 Months Ended | |||||||||
Jun. 02, 2021 CNY (¥) | Sep. 29, 2019 CNY (¥) | Sep. 26, 2019 CNY (¥) | Oct. 26, 2018 CNY (¥) | Feb. 28, 2017 CNY (¥) | Feb. 28, 2017 CNY (¥) item | Jun. 02, 2021 CNY (¥) | Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | Dec. 31, 2020 CNY (¥) | |
NON-CONTROLLING INTERESTS | ||||||||||||
Adjustment to redeemable non-controlling interests | ¥ 24,310,333 | |||||||||||
Loss from continuing operations before income taxes | ¥ (40,522,250) | $ (5,707,440) | ¥ (54,515,615) | ¥ (37,949,694) | ||||||||
Gain from the disposal of Muhua Shangce | ¥ 1,308,627 | ¥ 33,542,154 | ||||||||||
Muhua investment | ||||||||||||
NON-CONTROLLING INTERESTS | ||||||||||||
Cash consideration for new financing agreement with Muhua investment | ¥ 5,000,000 | |||||||||||
Muhua investment | Maximum | ||||||||||||
NON-CONTROLLING INTERESTS | ||||||||||||
Percentage of equity interest | 56% | |||||||||||
Muhua investment | Minimum | ||||||||||||
NON-CONTROLLING INTERESTS | ||||||||||||
Percentage of equity interest | 54.60% | |||||||||||
Muhua shangce | ||||||||||||
NON-CONTROLLING INTERESTS | ||||||||||||
Equity interest acquired | 50% | |||||||||||
Redemption value | ¥ 2,500,000 | |||||||||||
Loss from continuing operations before income taxes | ¥ 3,441,545 | ¥ 12,446,417 | ||||||||||
Net loss attributable to ATA Creativity Global | ¥ 1,879,084 | ¥ 6,795,744 | ||||||||||
Gain from the disposal of Muhua Shangce | ¥ 33,542,154 | |||||||||||
Investors | ||||||||||||
NON-CONTROLLING INTERESTS | ||||||||||||
Number of investors | item | 2 | |||||||||||
Equity interest acquired | 50% | 20% | ||||||||||
Redemption period | 5 years | 6 years | ||||||||||
Redemption value | ¥ 2,500,000 | ¥ 34,000,000 | ¥ 34,000,000 | |||||||||
Redemption value interest rate | 8% | 8% | 8% | |||||||||
ATA Education | Muhua shangce | Limited partnership | ||||||||||||
NON-CONTROLLING INTERESTS | ||||||||||||
Percentage of shares approved to be transferred | 24% | |||||||||||
Total consideration | ¥ 1,500,000 | |||||||||||
ATA Education | Muhua shangce | Chief executive officer | ||||||||||||
NON-CONTROLLING INTERESTS | ||||||||||||
Sold equity interest percentage | 54.60% |
NON-CONTROLLING INTERESTS - Sum
NON-CONTROLLING INTERESTS - Summary of Redeemable Non-Controlling Interest Activities (Details) | 5 Months Ended |
Jun. 02, 2021 CNY (¥) | |
NON-CONTROLLING INTERESTS | |
Balance at the beginning of the period | ¥ 48,498,368 |
Less: Comprehensive loss attributable to redeemable non-controlling interests during the period | (714,121) |
Accretion of redeemable non-controlling interests | 2,283,089 |
Balance at the end of the period | ¥ 50,067,336 |
NON-CONTROLLING INTERESTS - S_2
NON-CONTROLLING INTERESTS - Summary of Disposal Gain (Details) - CNY (¥) | 12 Months Ended | ||
Jun. 02, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
NON-CONTROLLING INTERESTS | |||
Gain from the disposal of Muhua Shangce | ¥ 1,308,627 | ¥ 33,542,154 | |
Muhua shangce | |||
NON-CONTROLLING INTERESTS | |||
Add: Carrying value of redeemable non-controlling interests in Muhua Shangce | ¥ 25,757,003 | ||
Add: Carrying value of non-redeemable non-controlling interests of Muhua Shangce | (4,423,059) | ||
Subtotal | 21,333,944 | ||
Less: Carrying value of net liabilities before disposal | (12,208,210) | ||
Gain from the disposal of Muhua Shangce | ¥ 33,542,154 |
SEGMENT INFORMATION - Additiona
SEGMENT INFORMATION - Additional Information (Details) | 12 Months Ended |
Dec. 31, 2023 segment | |
SEGMENT INFORMATION | |
Number of reportable segments | 2 |
Number of operating segments | 2 |
Number of operating segments met quantitative threshold percentage | 10% |
Product Concentration Risk | Revenue Benchmark | Overseas Art Study Services and Other Educational Services | Maximum | |
SEGMENT INFORMATION | |
Percentage of net revenue | 75% |
SEGMENT INFORMATION - Summary o
SEGMENT INFORMATION - Summary of Selected Financial Information Relating to Group's Segments (Details) | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | |
SEGMENT INFORMATION | ||||
Net revenues | ¥ 221,618,968 | $ 31,214,379 | ¥ 206,820,874 | ¥ 202,209,465 |
Operating cost and expenses: | ||||
Cost of revenues | 106,961,759 | 15,065,249 | 104,315,856 | 97,413,915 |
Research and development | 4,629,880 | 652,105 | 6,790,791 | 11,801,545 |
Selling and marketing | 78,737,492 | 11,089,944 | 75,265,726 | 66,149,460 |
Unallocated corporate expenses | 72,816,606 | 77,051,580 | 93,256,046 | |
Total operating cost and expenses | 263,145,737 | 263,423,953 | 268,620,966 | |
Other operating income, net | 30,865 | 4,347 | 16,515 | 22,018 |
Loss from operations | (41,495,904) | (5,844,576) | (56,586,564) | (66,389,483) |
Unallocated other income, net | 973,654 | 2,070,949 | 28,439,789 | |
Loss before income taxes | (40,522,250) | $ (5,707,440) | (54,515,615) | (37,949,694) |
Overseas art study services | ||||
SEGMENT INFORMATION | ||||
Net revenues | 201,955,180 | 181,833,076 | 21,174,198 | |
Operating cost and expenses: | ||||
Cost of revenues | 96,661,054 | 92,389,567 | 14,154,713 | |
Research and development | 3,672,094 | 5,903,055 | 3,148,402 | |
Selling and marketing | 73,182,842 | 69,398,473 | 5,598,532 | |
Total operating cost and expenses | 173,515,990 | 167,691,095 | 22,901,647 | |
Other operating income, net | 30,865 | |||
Loss from operations | 28,470,055 | 14,141,981 | (1,727,449) | |
Other educational services | ||||
SEGMENT INFORMATION | ||||
Net revenues | 19,663,788 | 24,657,609 | 181,035,267 | |
Operating cost and expenses: | ||||
Cost of revenues | 10,225,877 | 11,552,359 | 81,964,815 | |
Research and development | 114,516 | 4,176,398 | ||
Selling and marketing | 5,437,897 | 5,736,053 | 60,436,932 | |
Total operating cost and expenses | 15,778,290 | 17,288,412 | 146,578,145 | |
Loss from operations | 3,885,498 | 7,369,197 | 34,457,122 | |
Others | ||||
SEGMENT INFORMATION | ||||
Net revenues | 330,189 | |||
Operating cost and expenses: | ||||
Cost of revenues | 74,828 | 373,930 | 1,294,387 | |
Research and development | 843,270 | 887,736 | 4,476,745 | |
Selling and marketing | 116,753 | 131,200 | 113,996 | |
Total operating cost and expenses | 1,034,851 | 1,392,866 | 5,885,128 | |
Other operating income, net | 16,515 | 22,018 | ||
Loss from operations | ¥ (1,034,851) | ¥ (1,046,162) | ¥ (5,863,110) |
SHARE-BASED COMPENSATION - Addi
SHARE-BASED COMPENSATION - Additional Information (Details) | 1 Months Ended | 12 Months Ended | ||||||||||||||||||||||||||||
Apr. 01, 2024 shares | Nov. 01, 2023 shares | May 05, 2023 shares | Apr. 15, 2023 shares | Apr. 01, 2023 shares | Oct. 27, 2022 shares | Jun. 30, 2022 shares | Apr. 15, 2022 shares | Mar. 15, 2022 shares | Apr. 15, 2021 shares | Mar. 25, 2020 shares | Oct. 26, 2018 shares | Dec. 30, 2016 shares | Jan. 07, 2008 shares | Nov. 30, 2023 $ / shares shares | Feb. 28, 2022 $ / shares shares | Nov. 30, 2020 $ / shares shares | Mar. 31, 2019 $ / shares shares | Jan. 31, 2019 $ / shares shares | Dec. 31, 2018 shares | Nov. 30, 2018 $ / shares shares | Jul. 31, 2018 shares | Aug. 31, 2017 $ / shares shares | Jan. 31, 2017 $ / shares shares | Dec. 31, 2023 USD ($) $ / shares shares | Dec. 31, 2022 USD ($) $ / shares shares | Dec. 31, 2021 USD ($) $ / shares shares | Dec. 31, 2019 $ / shares shares | Dec. 31, 2018 CNY (¥) | Dec. 31, 2023 CNY (¥) shares | |
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Vesting rate (as a percent) | 25% | |||||||||||||||||||||||||||||
Granted (in shares) | 587,697 | 797,700 | 181,750 | |||||||||||||||||||||||||||
Granted (in dollars per share) | $ / shares | $ 1.07 | $ 0.99 | $ 0.57 | |||||||||||||||||||||||||||
Compensation costs accelerated and recognized | ¥ | ¥ 877,321 | |||||||||||||||||||||||||||||
Additional disclosures | ||||||||||||||||||||||||||||||
Share-based compensation arrangement by share-based payment award, options, grants in period, weighted average grant date fair value | $ / shares | $ 0.46 | $ 0.31 | $ 1.20 | |||||||||||||||||||||||||||
Share-based compensation arrangement by share-based payment award, options, exercises in period, intrinsic value | $ | $ 8,773 | $ 29,532 | $ 58,268 | |||||||||||||||||||||||||||
ATA Online | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Compensation costs accelerated and recognized | ¥ | ¥ 6,753,771 | |||||||||||||||||||||||||||||
Officer | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Granted (in dollars per share) | $ / shares | $ 0.79 | |||||||||||||||||||||||||||||
Share options issued (in shares) | 200,000 | |||||||||||||||||||||||||||||
Options | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Options cancelled (in shares) | 1,772,584 | |||||||||||||||||||||||||||||
Vested cancelled (in shares) | 1,215,114 | |||||||||||||||||||||||||||||
Total unrecognized compensation expense | ¥ | ¥ 593,891 | |||||||||||||||||||||||||||||
Weighted average period over which unrecognized compensation expense is expected to be recognized | 9 months | |||||||||||||||||||||||||||||
Options | ATA Online | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Options cancelled (in shares) | 129,168 | |||||||||||||||||||||||||||||
Options | Employees and officers | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Vesting rate (as a percent) | 75% | 75% | ||||||||||||||||||||||||||||
Vesting rate (as a percent) | 75% | |||||||||||||||||||||||||||||
Vesting period for remaining 75% shares | 36 months | 36 months | 36 months | |||||||||||||||||||||||||||
Vesting rate on the first anniversary (as a percent) | 25% | |||||||||||||||||||||||||||||
Granted (in shares) | 20,000 | 50,000 | 1,772,584 | 690,000 | 900,000 | |||||||||||||||||||||||||
Granted (in dollars per share) | $ / shares | $ 0.532 | $ 0.4868 | $ 0.578 | $ 1.705 | ||||||||||||||||||||||||||
Vesting rate at the end of each year from the grant date over 4 years (as a percent) | 25% | 25% | ||||||||||||||||||||||||||||
Vested immediately on the grant date (in shares) | 1,412,336 | |||||||||||||||||||||||||||||
Options | Employee | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Vesting rate (as a percent) | 75% | |||||||||||||||||||||||||||||
Vesting period for remaining 75% shares | 36 months | |||||||||||||||||||||||||||||
Vesting rate on the first anniversary (as a percent) | 25% | |||||||||||||||||||||||||||||
Granted (in shares) | 363,150 | 50,000 | ||||||||||||||||||||||||||||
Granted (in dollars per share) | $ / shares | $ 2.35 | |||||||||||||||||||||||||||||
Options | Certain employee and officer | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Vesting period | 4 years | |||||||||||||||||||||||||||||
Granted (in dollars per share) | $ / shares | $ 0.5697 | |||||||||||||||||||||||||||||
Share options issued (in shares) | 842,000 | 1,452,600 | ||||||||||||||||||||||||||||
Options | Officer | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Granted (in dollars per share) | $ / shares | $ 1.2611 | |||||||||||||||||||||||||||||
Share options issued (in shares) | 1,698,790 | |||||||||||||||||||||||||||||
Non-vested shares | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Non-vested shares granted | 872,500 | 350,500 | 77,500 | |||||||||||||||||||||||||||
Nonvested cancelled (in shares) | 557,470 | |||||||||||||||||||||||||||||
Total unrecognized compensation expense | ¥ | ¥ 2,756,874 | |||||||||||||||||||||||||||||
Weighted average period over which unrecognized compensation expense is expected to be recognized | 3 years 5 months 8 days | |||||||||||||||||||||||||||||
Additional disclosures | ||||||||||||||||||||||||||||||
Total fair value of shares vested | $ | $ 76,300 | $ 150,982 | $ 422,516 | |||||||||||||||||||||||||||
Number of vested shares withheld upon vesting to satisfy the minimum tax withholding obligation | 19,004 | 6,148 | 13,464 | |||||||||||||||||||||||||||
Non-vested shares | ATA Online | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Nonvested cancelled (in shares) | 1,262,250 | |||||||||||||||||||||||||||||
Non-vested shares | Employees and officers | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Vesting period | 4 years | |||||||||||||||||||||||||||||
Non-vested shares granted | 2,700,000 | |||||||||||||||||||||||||||||
Non-vested shares | Certain employee and officer | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Vesting rate (as a percent) | 40% | |||||||||||||||||||||||||||||
Granted (in shares) | 273,000 | |||||||||||||||||||||||||||||
Share options issued (in shares) | 310,000 | |||||||||||||||||||||||||||||
Vesting rate at the end of each year from the grant date over 4 years (as a percent) | 40% | |||||||||||||||||||||||||||||
Non-vested shares | Directors | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Vesting rate (as a percent) | 75% | 75% | ||||||||||||||||||||||||||||
Vesting period for remaining 75% shares | 36 months | 36 months | ||||||||||||||||||||||||||||
Non-vested shares granted | 800,000 | |||||||||||||||||||||||||||||
Vesting rate on the first anniversary (as a percent) | 25% | |||||||||||||||||||||||||||||
Granted (in shares) | 800,000 | |||||||||||||||||||||||||||||
Vesting rate at the end of each year from the grant date over 4 years (as a percent) | 25% | |||||||||||||||||||||||||||||
Grant date over 4 years | Non-vested shares | Employees and officers | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Vesting rate (as a percent) | 25% | |||||||||||||||||||||||||||||
2008 Share incentive plan | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Shares authorized | 5,726,763 | 336,307 | ||||||||||||||||||||||||||||
Annual increase in shares reserved (in shares) | 336,307 | |||||||||||||||||||||||||||||
Expiration term | 10 years | 10 years | ||||||||||||||||||||||||||||
2008 Share incentive plan | Options | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Expiration term | 10 years | |||||||||||||||||||||||||||||
2008 Share incentive plan | Non-vested shares | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Vesting period for remaining 75% shares | 4 years | |||||||||||||||||||||||||||||
Vesting period | 36 months | |||||||||||||||||||||||||||||
2008 Share incentive plan | Vesting on first anniversary | Options | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Vesting rate (as a percent) | 25% | |||||||||||||||||||||||||||||
2008 Share incentive plan | Vesting ratably over following 36 months | Options | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Vesting rate (as a percent) | 75% | |||||||||||||||||||||||||||||
Vesting period | 36 months | |||||||||||||||||||||||||||||
2008 Share incentive plan | Grant date over 4 years | Non-vested shares | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Vesting rate (as a percent) | 25% | |||||||||||||||||||||||||||||
Amendment and Restatement of 2008 Plan | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Common shares reserved for issuance | 6,965,846 | 9,929,472 | ||||||||||||||||||||||||||||
Second Amendment and Restatement of 2008 Plan | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Annual increase in shares reserved (as a percent) | 1% | 1% | ||||||||||||||||||||||||||||
First Tranche A | Options | Certain employee and officer | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Granted (in shares) | 181,750 | |||||||||||||||||||||||||||||
Vested (in shares) | 46,050 | |||||||||||||||||||||||||||||
Second Tranche A | Options | Certain employee and officer | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Granted (in shares) | 173,002 | |||||||||||||||||||||||||||||
Third Tranche A | Non-vested shares | Certain employee and officer | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Granted (in shares) | 158,000 | |||||||||||||||||||||||||||||
Third Tranche A | Non-vested shares | Certain employee and officer | Subsequent Event | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Vested (in shares) | 83,400 | |||||||||||||||||||||||||||||
First Tranche B | Non-vested shares | Certain employee and officer | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Non-vested shares granted | 77,500 | |||||||||||||||||||||||||||||
Vested (in shares) | 16,000 | |||||||||||||||||||||||||||||
Second Tranche B | Options | Certain employee and officer | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Vested (in shares) | 57,250 | |||||||||||||||||||||||||||||
Second Tranche B | Non-vested shares | Certain employee and officer | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Non-vested shares granted | 77,500 | |||||||||||||||||||||||||||||
Vested (in shares) | 24,750 | |||||||||||||||||||||||||||||
Third Tranche B | Non-vested shares | Certain employee and officer | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Non-vested shares granted | 72,500 | |||||||||||||||||||||||||||||
Third Tranche B | Non-vested shares | Certain employee and officer | Subsequent Event | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Vested (in shares) | 43,250 | |||||||||||||||||||||||||||||
First Tranche | Options | Officer | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Granted (in shares) | 424,698 | |||||||||||||||||||||||||||||
Second Tranche | Options | Officer | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Granted (in shares) | 424,698 | |||||||||||||||||||||||||||||
Third Tranche | Options | Officer | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Granted (in shares) | 424,697 | |||||||||||||||||||||||||||||
First Tranche C | Options | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Non-vested shares granted | 5,000 | |||||||||||||||||||||||||||||
Granted (in dollars per share) | $ / shares | $ 0.48 | |||||||||||||||||||||||||||||
Share options issued (in shares) | 20,000 | |||||||||||||||||||||||||||||
First Tranche C | Options | Subsequent Event | ||||||||||||||||||||||||||||||
SHARE-BASED COMPENSATION | ||||||||||||||||||||||||||||||
Vested (in shares) | 5,000 |
SHARE-BASED COMPENSATION - Summ
SHARE-BASED COMPENSATION - Summary of the Share Options Activities (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Number of shares | |||
Outstanding at the beginning of the period (in shares) | 1,376,742 | 810,832 | 827,198 |
Granted (in shares) | 587,697 | 797,700 | 181,750 |
Exercised (in shares) | (113,328) | (53,538) | (62,416) |
Forfeited (in shares) | (162,518) | (178,252) | (135,700) |
Outstanding at the end of the period (in shares) | 1,688,593 | 1,376,742 | 810,832 |
Vested and expected to vest at the end of the period (in shares) | 1,688,593 | ||
Exercisable at the end of the period (in shares) | 1,025,496 | ||
Outstanding at the beginning of the period (in dollars per share) | $ 1.03 | $ 1.02 | $ 1.01 |
Granted (in dollars per share) | 1.07 | 0.99 | 0.57 |
Exercised (in dollars per share) | 0.58 | 0.58 | 0.58 |
Forfeited (in dollars per share) | 0.57 | 0.97 | 0.57 |
Outstanding at the end of the period (in dollars per share) | 1.12 | $ 1.03 | $ 1.02 |
Vested and expected to vest at the end of the period (in dollars per share) | 1.12 | ||
Exercisable at the end of the period (in dollars per share) | $ 1.15 | ||
Weighted remaining contractual Years | |||
Vested and expected to vest at the end of the period | 6 years 14 days | ||
Exercisable at the end of the period | 5 years 9 months 25 days | ||
Aggregate intrinsic value | |||
Vested and expected to vest at the end of the period (in dollars) | $ 3,093 | ||
Exercisable at the end of the period (in dollars) | $ 1,747 |
SHARE-BASED COMPENSATION - Sche
SHARE-BASED COMPENSATION - Schedule of Information Relating to Options Outstanding and Exercisable (Details) | 12 Months Ended |
Dec. 31, 2023 $ / shares shares | |
Options outstanding as of December 31, 2023 | |
Number of Shares | shares | 1,688,593 |
Exercise Price per Share | $ / shares | $ 1.12 |
Remaining Contractual Life | 6 years 14 days |
Options exercisable as of December 31, 2023 | |
Number of Shares | shares | 1,025,496 |
Exercise Price per Share | $ / shares | $ 1.15 |
Remaining Contractual Life | 5 years 9 months 25 days |
Range One | |
Options outstanding as of December 31, 2023 | |
Number of Shares | shares | 20,000 |
Exercise Price per Share | $ / shares | $ 0.58 |
Remaining Contractual Life | 4 years 10 months 6 days |
Options exercisable as of December 31, 2023 | |
Number of Shares | shares | 20,000 |
Exercise Price per Share | $ / shares | $ 0.58 |
Remaining Contractual Life | 4 years 10 months 6 days |
Range Two | |
Options outstanding as of December 31, 2023 | |
Number of Shares | shares | 16,800 |
Exercise Price per Share | $ / shares | $ 0.53 |
Remaining Contractual Life | 5 years 2 months 15 days |
Options exercisable as of December 31, 2023 | |
Number of Shares | shares | 16,800 |
Exercise Price per Share | $ / shares | $ 0.53 |
Remaining Contractual Life | 5 years 2 months 15 days |
Range Three | |
Options outstanding as of December 31, 2023 | |
Number of Shares | shares | 1,274,093 |
Exercise Price per Share | $ / shares | $ 1.26 |
Remaining Contractual Life | 5 years 7 months 6 days |
Options exercisable as of December 31, 2023 | |
Number of Shares | shares | 849,396 |
Exercise Price per Share | $ / shares | $ 1.26 |
Remaining Contractual Life | 5 years 7 months 6 days |
Range Four | |
Options outstanding as of December 31, 2023 | |
Number of Shares | shares | 172,700 |
Exercise Price per Share | $ / shares | $ 0.57 |
Remaining Contractual Life | 7 years 3 days |
Options exercisable as of December 31, 2023 | |
Number of Shares | shares | 89,300 |
Exercise Price per Share | $ / shares | $ 0.57 |
Remaining Contractual Life | 7 years 3 days |
Range Five | |
Options outstanding as of December 31, 2023 | |
Number of Shares | shares | 200,000 |
Exercise Price per Share | $ / shares | $ 0.79 |
Remaining Contractual Life | 8 years 1 month 9 days |
Options exercisable as of December 31, 2023 | |
Number of Shares | shares | 50,000 |
Exercise Price per Share | $ / shares | $ 0.79 |
Remaining Contractual Life | 8 years 1 month 9 days |
Range Six | |
Options outstanding as of December 31, 2023 | |
Number of Shares | shares | 5,000 |
Exercise Price per Share | $ / shares | $ 0.48 |
Remaining Contractual Life | 10 years 3 days |
SHARE-BASED COMPENSATION - Su_2
SHARE-BASED COMPENSATION - Summary of Assumptions Used in the Valuation Model (Details) - Options | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Assumptions used in the valuation model | |||
Expected dividend yield | 0% | 0% | 0% |
Expected volatility | 68% | 67% | 70% |
Expected term | 5 years 4 months 24 days | ||
Risk-free interest rate | 0.90% | ||
Weighted Average | |||
Assumptions used in the valuation model | |||
Expected term | 4 years 3 months 14 days | 4 years 9 months 14 days | |
Risk-free interest rate | 3.68% | 2.78% | |
Minimum | |||
Assumptions used in the valuation model | |||
Expected term | 3 years 6 months 29 days | 4 years 2 months 1 day | |
Risk-free interest rate | 3.57% | 2.08% | |
Maximum | |||
Assumptions used in the valuation model | |||
Expected term | 5 years 3 months | 6 years 3 months | |
Risk-free interest rate | 4.68% | 1.84% |
SHARE-BASED COMPENSATION - Sc_2
SHARE-BASED COMPENSATION - Schedule of Compensation Expense Recognized for Non-vested Shares (Details) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Options | |||
SHARE-BASED COMPENSATION | |||
Total-share based compensation expense | ¥ 1,550,137 | ¥ 1,035,787 | ¥ 552,409 |
Options | Cost of revenues | |||
SHARE-BASED COMPENSATION | |||
Total-share based compensation expense | 53,104 | 59,874 | 62,224 |
Options | Research and development | |||
SHARE-BASED COMPENSATION | |||
Total-share based compensation expense | 4,785 | 6,944 | |
Options | Sales and marketing | |||
SHARE-BASED COMPENSATION | |||
Total-share based compensation expense | 53,133 | 35,546 | 6,806 |
Options | General and administrative | |||
SHARE-BASED COMPENSATION | |||
Total-share based compensation expense | 1,443,900 | 935,582 | 476,435 |
Non-vested shares | |||
SHARE-BASED COMPENSATION | |||
Total-share based compensation expense | 1,517,904 | 423,968 | 487,563 |
Non-vested shares | Cost of revenues | |||
SHARE-BASED COMPENSATION | |||
Total-share based compensation expense | 21,722 | 29,057 | 27,806 |
Non-vested shares | Research and development | |||
SHARE-BASED COMPENSATION | |||
Total-share based compensation expense | 3,692 | ||
Non-vested shares | Sales and marketing | |||
SHARE-BASED COMPENSATION | |||
Total-share based compensation expense | 63,321 | 40,655 | 11,741 |
Non-vested shares | General and administrative | |||
SHARE-BASED COMPENSATION | |||
Total-share based compensation expense | ¥ 1,432,861 | ¥ 354,256 | ¥ 444,324 |
SHARE-BASED COMPENSATION - Su_3
SHARE-BASED COMPENSATION - Summary of the Non-vested Shares Activities (Details) - Non-vested shares - $ / shares | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
SHARE-BASED COMPENSATION | |||
Outstanding at the beginning of the period (in shares) | 297,750 | 199,336 | 603,088 |
Granted (in shares) | 872,500 | 350,500 | 77,500 |
Vested (in shares) | (133,950) | (199,336) | (419,752) |
Forfeited (in share) | (29,250) | (52,750) | (61,500) |
Outstanding at the end of the period (in shares) | 1,007,050 | 297,750 | 199,336 |
Outstanding at the beginning of the period (in dollars per share) | $ 0.881 | $ 0.671 | $ 0.955 |
Granted (in dollars per share) | 0.467 | 0.841 | 1.545 |
Vested (in dollars per share) | 0.851 | 0.671 | 1.112 |
Forfeited & Cancelled (in dollars per share) | 0.925 | 0.615 | 1.545 |
Outstanding at the end of the period (in dollars per share) | $ 0.525 | $ 0.881 | $ 0.671 |
COMMON SHARES (Details)
COMMON SHARES (Details) $ / shares in Units, ¥ in Millions, $ in Millions | 1 Months Ended | 12 Months Ended | ||||||||
Apr. 10, 2020 USD ($) | Apr. 10, 2020 CNY (¥) | Dec. 24, 2019 USD ($) shares | May 31, 2020 USD ($) $ / shares shares | Dec. 31, 2023 shares | Dec. 31, 2022 shares | Dec. 31, 2020 USD ($) | Dec. 31, 2020 CNY (¥) | Dec. 31, 2019 USD ($) | Dec. 31, 2019 CNY (¥) | |
ADS | ||||||||||
Common shares | ||||||||||
Authorized amount to repurchase (in dollars) | $ | $ 1 | |||||||||
Repurchase of common share | 450,337 | |||||||||
Average stock price | $ / shares | $ 1.2631 | |||||||||
Total cash consideration | $ 0.6 | ¥ 4 | ||||||||
Shares used for settlement of vested share options and restricted shares vesting | 1,124,626 | 1,080,549 | ||||||||
Private Placement | ||||||||||
Common shares | ||||||||||
Issuance of common shares upon private placement (in shares) | 5,662,634 | |||||||||
Proceeds from issuance of common stock | $ 1.2 | ¥ 8.5 | $ 10 | $ 8.8 | ¥ 61.7 |
STATUTORY RESERVES (Details)
STATUTORY RESERVES (Details) - CNY (¥) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
STATUTORY RESERVES | ||
Required percentage of after tax profit transferred to general reserve fund | 10% | |
Percentage of registered capital limit for transfer of after tax profit to general reserve fund | 50% | |
Accumulated of after tax profit to statutory reserve fund | ¥ 25,698,704 | ¥ 25,698,704 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) | 1 Months Ended | 12 Months Ended | ||||||||||||||
Mar. 30, 2020 CNY (¥) | Mar. 05, 2020 CNY (¥) | Aug. 31, 2023 CNY (¥) | Aug. 31, 2023 USD ($) | Mar. 31, 2023 CNY (¥) | Sep. 30, 2022 USD ($) | Jun. 30, 2022 CNY (¥) | Jan. 31, 2022 CNY (¥) | Oct. 31, 2021 CNY (¥) | May 31, 2021 CNY (¥) | Nov. 30, 2020 CNY (¥) | Apr. 30, 2020 CNY (¥) | Dec. 31, 2023 CNY (¥) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | Dec. 31, 2020 CNY (¥) | |
Jinan Nuobi | ||||||||||||||||
RELATED PARTY TRANSACTIONS | ||||||||||||||||
Percentage of equity interest acquired | 100% | |||||||||||||||
Consideration transferred | ¥ 500,000 | |||||||||||||||
Purchase of equity interest from a Related Party | Jinan Nuobi | ||||||||||||||||
RELATED PARTY TRANSACTIONS | ||||||||||||||||
Percentage of equity interest acquired | 100% | |||||||||||||||
Consideration transferred | $ | $ 500,000 | |||||||||||||||
ATA Learning Inc | Purchase of video services | ||||||||||||||||
RELATED PARTY TRANSACTIONS | ||||||||||||||||
Related Party Contract Value To Provide Professional Videography And Production Of Video Services | $ | $ 10,000 | |||||||||||||||
Purchase | ¥ 21,248 | ¥ 49,579 | ||||||||||||||
ApplySquare Education & Technology Co., Ltd. ("ApplySquare") | Purchase of IT System Consulting Service, Office Sharing Service and System Development and Data Services | ||||||||||||||||
RELATED PARTY TRANSACTIONS | ||||||||||||||||
Total amount of the agreement | ¥ 1,200,000 | |||||||||||||||
Increase In Related Party Contract Value | ¥ 22,000 | |||||||||||||||
Revised related party contract amount | ¥ 6,300,000 | |||||||||||||||
Related party contract value to develop sales delivering services and data services | ¥ 6,500,000 | |||||||||||||||
Number of years charge of data and system maintenance services | 1 year | |||||||||||||||
ApplySquare Education & Technology Co., Ltd. ("ApplySquare") | Purchase of IT System Consulting Service | ||||||||||||||||
RELATED PARTY TRANSACTIONS | ||||||||||||||||
Purchase | ¥ 50,913 | |||||||||||||||
ApplySquare Education & Technology Co., Ltd. ("ApplySquare") | Purchase of Office Sharing Service | ||||||||||||||||
RELATED PARTY TRANSACTIONS | ||||||||||||||||
Purchase | 236,960 | 1,128,016 | 275,967 | |||||||||||||
ApplySquare Education & Technology Co., Ltd. ("ApplySquare") | Purchase of System Development and Data Services | ||||||||||||||||
RELATED PARTY TRANSACTIONS | ||||||||||||||||
Purchase | ¥ 1,800,000 | ¥ 3,700,000 | ||||||||||||||
Affiliate Company | Interest-free personal funding support | Management | ||||||||||||||||
RELATED PARTY TRANSACTIONS | ||||||||||||||||
Related party debt | ¥ 200,000 | ¥ 431,000 | ||||||||||||||
Amounts due to a related party | ¥ 631,000 | |||||||||||||||
Affiliate Company | Interest-free loan | Management | ||||||||||||||||
RELATED PARTY TRANSACTIONS | ||||||||||||||||
Amounts due to a related party | ¥ 500,000 | |||||||||||||||
Affiliate Company | Ten-month interest-free loan | Management | ||||||||||||||||
RELATED PARTY TRANSACTIONS | ||||||||||||||||
Related party debt | ¥ 500,000 | |||||||||||||||
Affiliate Company | Fourteen-month interest-free loan | Management | ||||||||||||||||
RELATED PARTY TRANSACTIONS | ||||||||||||||||
Related party debt | ¥ 700,000 | |||||||||||||||
Mr. Xiaofeng Ma | Joint Liability Guarantee provided by a Related Party | Muhua Shangce | ||||||||||||||||
RELATED PARTY TRANSACTIONS | ||||||||||||||||
Related party debt | ¥ 3,000,000 | |||||||||||||||
Annual interest rate | 4.35% | |||||||||||||||
Muhua Shangce Learning Data & Technology (Beijing) Limited | Interest-free loan | ||||||||||||||||
RELATED PARTY TRANSACTIONS | ||||||||||||||||
Related party transactions derecognized | ¥ 1,200,000 | |||||||||||||||
Muhua Shangce Learning Data & Technology (Beijing) Limited | Ten-month interest-free loan | ||||||||||||||||
RELATED PARTY TRANSACTIONS | ||||||||||||||||
Term of loan from a related party (in month) | 10 months | |||||||||||||||
Muhua Shangce Learning Data & Technology (Beijing) Limited | Fourteen-month interest-free loan | ||||||||||||||||
RELATED PARTY TRANSACTIONS | ||||||||||||||||
Term of loan from a related party (in month) | 14 months |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) $ in Millions | 1 Months Ended | 12 Months Ended | ||||
Aug. 01, 2021 CNY (¥) | Aug. 31, 2021 CNY (¥) | Mar. 31, 2020 CNY (¥) shares | Mar. 31, 2020 USD ($) shares | Dec. 31, 2031 CNY (¥) | Dec. 31, 2023 CNY (¥) | |
Commitments and Contingencies | ||||||
Property management expense | ¥ 3,747,872 | |||||
Loss contingency accrued | 0 | |||||
Remaining investment commitment | ¥ 30,000,000 | |||||
ATA Learning (Beijing) | ||||||
Commitments and Contingencies | ||||||
Investment Company, Committed Capital | ¥ 80,000,000 | |||||
Equity investment, Ownership percentage | 40% | |||||
Alpha Advantage Global Limited | ||||||
Commitments and Contingencies | ||||||
Common shares holding at time of sale of business | shares | 4,529,100 | 4,529,100 | ||||
Dynamic Fame Limited | ||||||
Commitments and Contingencies | ||||||
Common shares holding at time of sale of business | shares | 188,000 | 188,000 | ||||
Huanqiuyimeng | ||||||
Commitments and Contingencies | ||||||
Investment Company, Committed Capital | ¥ 110,000,000 | ¥ 30,000,000 | ||||
Equity investment, Ownership percentage | 55% | 15% | ||||
Decrease to capital contribution | ¥ 30,000,000 | |||||
ATA Online Sale Transaction | ||||||
Commitments and Contingencies | ||||||
Total consideration | $ | $ 200 | |||||
ATA Online Sale Transaction | Alpha Advantage Global Limited and Dynamic Fame Limited | ||||||
Commitments and Contingencies | ||||||
Attorney's fees and other litigation costs | ¥ 15,000,000 | |||||
ATA Online Sale Transaction | Mr. Xiaofeng Ma | Alpha Advantage Global Limited | ||||||
Commitments and Contingencies | ||||||
Attorney's fees and other litigation costs | 1,500,000 | |||||
Loss contingency, damages sought, value | 95,000,000 | |||||
ATA Online Sale Transaction | Mr. Xiaofeng Ma | Dynamic Fame Limited | ||||||
Commitments and Contingencies | ||||||
Attorney's fees and other litigation costs | 500,000 | |||||
Loss contingency, damages sought, value | ¥ 5,000,000 |
EARNINGS (LOSSES) PER COMMON _3
EARNINGS (LOSSES) PER COMMON SHARE - Schedule of Basic and Diluted Losses Per Common Share (Details) | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) ¥ / shares shares | Dec. 31, 2023 USD ($) $ / shares shares | Dec. 31, 2022 CNY (¥) ¥ / shares shares | Dec. 31, 2021 CNY (¥) ¥ / shares shares | |
Numerator: | ||||
Net loss attributable to ATA Creativity Global | ¥ (33,660,245) | $ (4,740,947) | ¥ (47,892,909) | ¥ (33,649,593) |
Redeemable non-controlling interest redemption value accretion | ¥ | (2,283,089) | |||
Net loss available to common shareholders | ¥ | ¥ (33,660,245) | ¥ (47,892,909) | ¥ (35,932,682) | |
Denominator for basic loss per share: | ||||
Weighted average common shares outstanding | shares | 62,789,811 | 62,789,811 | 62,753,840 | 62,748,095 |
Denominator for diluted loss per share | shares | 62,789,811 | 62,789,811 | 62,753,840 | 62,748,095 |
Basic loss per common share attributable to ATA Creativity Global | (per share) | ¥ (0.54) | $ (0.08) | ¥ (0.76) | ¥ (0.57) |
Diluted loss per common share attributable to ATA Creativity Global | (per share) | ¥ (0.54) | $ (0.08) | ¥ (0.76) | ¥ (0.57) |
EARNINGS (LOSSES) PER COMMON _4
EARNINGS (LOSSES) PER COMMON SHARE - Summary of Potential Common Shares Outstanding Excluded From the Calculation of Diluted Earnings (Loss) Per Share (Details) - shares | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
EARNINGS (LOSSES) PER COMMON SHARE | |||
Shares issuable under restricted shares and share options (in shares) | 2,730,129 | 1,674,492 | 826,832 |
ATA Creativity Global ("Paren_3
ATA Creativity Global ("Parent Company") - Condensed Balance Sheets (Details) | Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) |
Condensed Financial Statements Captions [Line Items] | |||
Cash and cash equivalents | ¥ 60,167,232 | $ 8,474,377 | ¥ 54,980,199 |
Prepaid expenses and other current assets | 8,042,169 | 1,132,716 | 4,430,285 |
Total assets | 448,939,143 | 63,231,755 | 474,464,769 |
Accrued expenses and other payables | 49,146,103 | 6,922,083 | 55,904,510 |
Total liabilities | 335,965,436 | 47,319,741 | 330,950,579 |
Common shares | 4,730,128 | 666,225 | 4,720,147 |
Treasury shares | (8,201,046) | (1,155,093) | (8,626,894) |
Additional paid in capital | 545,222,465 | 76,792,978 | 542,058,092 |
Accumulated other comprehensive loss | (37,004,507) | (5,211,976) | (37,003,085) |
Accumulated deficit | (391,709,172) | (55,171,083) | (358,048,927) |
Total shareholders' equity attributable to ATA Creativity Global | 113,037,868 | 15,921,051 | 143,099,333 |
Total liabilities and shareholders' equity | 448,939,143 | 63,231,755 | 474,464,769 |
ATA Creativity Global | |||
Condensed Financial Statements Captions [Line Items] | |||
Cash and cash equivalents | 1,068,177 | 150,450 | 1,098,896 |
Prepaid expenses and other current assets | 4,272 | 602 | 4,252 |
Investments in subsidiaries | 115,087,677 | 16,209,760 | 144,677,894 |
Total assets | 116,160,126 | 16,360,812 | 145,781,042 |
Accrued expenses and other payables | 3,122,258 | 439,761 | 2,681,709 |
Total liabilities | 3,122,258 | 439,761 | 2,681,709 |
Common shares | 4,730,128 | 666,225 | 4,720,147 |
Treasury shares | (8,201,046) | (1,155,093) | (8,626,894) |
Additional paid in capital | 545,222,465 | 76,792,978 | 542,058,092 |
Accumulated other comprehensive loss | (37,004,507) | (5,211,976) | (37,003,085) |
Accumulated deficit | (391,709,172) | (55,171,083) | (358,048,927) |
Total shareholders' equity attributable to ATA Creativity Global | 113,037,868 | 15,921,051 | 143,099,333 |
Total liabilities and shareholders' equity | ¥ 116,160,126 | $ 16,360,812 | ¥ 145,781,042 |
ATA Creativity Global ("Paren_4
ATA Creativity Global ("Parent Company") - Condensed Statements of Comprehensive Income (Loss) (Details) | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | |
Condensed Financial Statements Captions [Line Items] | ||||
Cost of revenues | ¥ 106,961,759 | $ 15,065,249 | ¥ 104,315,856 | ¥ 97,413,915 |
Operating expenses | (156,183,978) | (21,998,053) | (159,108,097) | (171,207,051) |
Foreign currency exchange losses, net | (4,876) | (687) | 5,436 | (213,046) |
Loss before income taxes | (40,522,250) | (5,707,440) | (54,515,615) | (37,949,694) |
Income tax expense | (6,811,709) | (959,409) | (5,921,384) | (1,539,577) |
Net loss attributable to ATA Creativity Global | (33,660,245) | (4,740,947) | (47,892,909) | (33,649,593) |
Comprehensive loss attributable to ATA Creativity Global | (33,661,667) | (4,741,147) | (47,336,147) | (33,784,718) |
ATA Creativity Global | ||||
Condensed Financial Statements Captions [Line Items] | ||||
Cost of revenues | (74,827) | (10,539) | (88,930) | (90,029) |
Operating expenses | (5,141,980) | (724,233) | (6,175,519) | (6,412,398) |
Investment loss | (28,469,235) | (4,009,808) | (41,635,317) | (5,120,016) |
Interest income | 25,802 | 3,634 | 6,861 | 139 |
Foreign currency exchange losses, net | (5) | (1) | (4) | (45) |
Loss before income taxes | (33,660,245) | (4,740,947) | (47,892,909) | (11,622,349) |
Net loss attributable to ATA Creativity Global | (33,660,245) | (4,740,947) | (47,892,909) | (11,622,349) |
Other comprehensive income (loss) | (1,422) | (200) | 556,762 | (135,125) |
Comprehensive loss attributable to ATA Creativity Global | ¥ (33,661,667) | $ (4,741,147) | ¥ (47,336,147) | ¥ (11,757,474) |
ATA Creativity Global ("Paren_5
ATA Creativity Global ("Parent Company") - Condensed Statements of Cash Flows (Details) | 12 Months Ended | |||
Dec. 31, 2023 CNY (¥) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 CNY (¥) | Dec. 31, 2021 CNY (¥) | |
Condensed Financial Statements Captions [Line Items] | ||||
Net cash used in operating activities | ¥ 8,751,473 | $ 1,232,619 | ¥ (14,613,887) | ¥ (31,833,685) |
Cash flows from investing activities: | ||||
Net cash used in investing activities | (3,966,486) | (558,668) | (2,490,103) | (10,028,992) |
Cash flows from financing activities: | ||||
Cash received for exercise of share options | 471,765 | 66,447 | 218,943 | 232,245 |
Net cash provided by financing activities | 403,439 | 56,823 | 188,212 | 827,516 |
Effect of foreign exchange rate changes on cash | (1,393) | (196) | 556,616 | (348,911) |
Net increase (decrease) in cash and cash equivalents | 5,187,033 | 730,578 | (16,359,162) | (41,384,072) |
Cash and cash equivalents at beginning of year | 54,980,199 | 7,743,799 | 71,339,361 | 112,723,433 |
Cash and cash equivalents at end of year | 60,167,232 | 8,474,377 | 54,980,199 | 71,339,361 |
ATA Creativity Global | ||||
Condensed Financial Statements Captions [Line Items] | ||||
Net cash used in operating activities | (1,637,065) | (230,576) | (4,509,052) | (4,529,860) |
Cash flows from investing activities: | ||||
Cash received from subsidiaries | 2,546,883 | 358,721 | 3,159,503 | 4,113,412 |
Cash lent to subsidiaries | (1,437,720) | (202,499) | (101,614) | (9,692) |
Net cash used in investing activities | 1,109,163 | 156,222 | 3,057,889 | 4,103,720 |
Cash flows from financing activities: | ||||
Cash received for exercise of share options | 471,765 | 66,448 | 218,943 | 232,245 |
Net cash provided by financing activities | 471,765 | 66,448 | 218,943 | 232,245 |
Effect of foreign exchange rate changes on cash | 25,418 | 3,580 | 95,386 | (57,011) |
Net increase (decrease) in cash and cash equivalents | (30,719) | (4,326) | (1,136,834) | (250,906) |
Cash and cash equivalents at beginning of year | 1,098,896 | 154,776 | 2,235,730 | 2,486,636 |
Cash and cash equivalents at end of year | ¥ 1,068,177 | $ 150,450 | ¥ 1,098,896 | ¥ 2,235,730 |