Document And Entity Information
Document And Entity Information | 9 Months Ended |
Apr. 30, 2015 | |
Document Information [Line Items] | |
Entity Registrant Name | XIANGTIAN (USA) AIR POWER CO., LTD. |
Entity Central Index Key | 1,472,468 |
Entity Filer Category | Smaller Reporting Company |
Document Type | S1 |
Amendment Flag | false |
Document Period End Date | Apr. 30, 2015 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Apr. 30, 2015 | Jul. 31, 2014 | Jul. 31, 2013 |
Current assets | |||
Cash and cash equivalence | $ 491,657 | $ 556,788 | $ 1,640,007 |
Accounts receivable | 806,218 | 0 | |
Other receivables | 350,283 | 23,791 | 0 |
Advances to suppliers | 5,523,978 | 7,490,564 | 0 |
Due from related parties | 403,109 | 0 | |
Inventory | 2,175,714 | 1,781,653 | 0 |
Deferred tax asset | 298,171 | 111,844 | 0 |
Other current asset | 3,847,728 | 1,146,785 | 0 |
Total current assets | 13,896,858 | 11,111,425 | 1,640,007 |
Non-current assets | |||
Property, plant and equipment, net | 7,793,240 | 6,779,256 | 0 |
Deposit for property, plant and equipment | 90,941 | 1,590,581 | 0 |
Total non-current assets | 7,884,181 | 8,369,837 | 0 |
Total assets | 21,781,039 | 19,481,262 | 1,640,007 |
Current liabilities | |||
Accounts payable and accrued liabilities | 2,573,237 | 355,861 | 1,500 |
Amount due to shareholders | 18,978 | 18,934 | 0 |
Capital lease interest payable to related parties | 172,611 | 52,542 | |
Capital lease obligations - current | 63,248 | 31,022 | 0 |
Amount due to director | 417,776 | 430,928 | 8,999 |
Advances from related parties | 690,316 | 3,027,605 | 97,110 |
Advance from customers | 264,510 | 120,649 | |
Billings in excess of costs | 6,663,850 | 3,847,085 | |
Advance billings on contracts | 11,831,607 | 0 | |
Total current liabilities | 10,864,526 | 7,884,626 | 107,609 |
Non-current liabilities | |||
Capital lease obligations - non-current | 2,699,814 | 2,718,106 | 0 |
Total non-current liabilities | 2,699,814 | 2,718,106 | 0 |
Total liabilities | $ 13,564,340 | $ 10,602,732 | $ 107,609 |
Commitments and contingencies | |||
STOCKHOLDERS' EQUITY | |||
Preferred stock: $0.001 par value, 100,000,000 shares authorized, none issued and outstanding | $ 0 | $ 0 | |
Common stock value | $ 598,042 | 598,042 | 8,000 |
Additional paid-in capital | 9,456,175 | 9,451,675 | 1,704,943 |
Subscription receivable | (317,000) | (317,000) | |
Deficit accumulated | (1,553,110) | (862,211) | (181,017) |
Accumulated other comprehensive gain | 32,592 | 8,024 | 472 |
Total stockholders' equity | 8,216,699 | 8,878,530 | 1,532,398 |
Total liabilities and stockholders' equity | $ 21,781,039 | $ 19,481,262 | $ 1,640,007 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Apr. 30, 2015 | Jul. 31, 2014 | Jul. 31, 2013 |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 100,000,000 | 100,000,000 | 100,000,000 |
Preferred stock, shares issued | 0 | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 1,000,000,000 | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued | 598,042,000 | 598,042,000 | 8,000,000 |
Common stock, shares outstanding | 598,042,000 | 598,042,000 | 8,000,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statement of Operations and Comprehensive Loss - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Apr. 30, 2015 | Apr. 30, 2014 | Apr. 30, 2015 | Apr. 30, 2014 | Jul. 31, 2014 | Jul. 31, 2013 | |
Revenue | $ 1,133,522 | $ 0 | $ 1,133,522 | $ 0 | $ 0 | $ 0 |
Cost of sales | 938,674 | $ 0 | 938,674 | $ 0 | 0 | 0 |
Sales Tax | 3,117 | 3,117 | ||||
Gross profit | 191,731 | $ 0 | 191,731 | $ 0 | 0 | 0 |
Operating expenses: | ||||||
Selling expenses | 5,731 | 0 | 16,391 | 0 | 5,479 | 0 |
General and administrative expenses | 187,067 | 153,049 | 918,378 | 366,244 | 745,127 | 87,589 |
Loss from operations | 192,798 | 153,049 | 934,769 | 366,244 | (750,606) | (87,589) |
Net gain (loss) from operations | (1,067) | (153,049) | (743,038) | (366,244) | ||
Other (expense) income: | ||||||
Interest (expense) income | (44,178) | (200) | (126,879) | 383 | (44,909) | 0 |
Other expenses | 0 | 0 | (90) | 0 | ||
Foreign exchange gain (loss) | 491 | 0 | (12) | 0 | 389 | 0 |
Total other (expense) income, net | (43,687) | (200) | (126,981) | 383 | (44,520) | 0 |
Net loss before taxes | (44,754) | (153,249) | (870,019) | (365,861) | (795,126) | (87,589) |
Income tax benefit | 20,548 | 27,857 | 179,120 | 38,261 | 113,932 | 0 |
Net loss after taxes | (24,206) | (125,392) | (690,899) | (327,600) | (681,194) | (87,589) |
Foreign currency translation adjustment | 68,662 | (72,225) | 24,568 | (59,981) | 7,552 | 472 |
Comprehensive gain (loss) | $ 44,456 | $ (197,617) | $ (666,331) | $ (387,581) | $ (673,642) | $ (87,117) |
Net loss per common share - basic and diluted (in dollars per share) | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ (0.01) |
Weighted average number of common shares outstanding - basic and diluted (in shares) | 598,042,000 | 325,000,000 | 598,042,000 | 263,457,875 | 284,206,285 | 8,000,000 |
Consolidated Statement of Stock
Consolidated Statement of Stockholders' Equity (Deficit) - USD ($) | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Subscription Receivable [Member] | Retained Earnings [Member] | Other Comprehensive Income (Loss) [Member] |
Opening Balance at Sep. 01, 2008 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 |
Opening Balance (in shares) at Sep. 01, 2008 | 0 | |||||
Common stock issued for cash | 25,000 | $ 5,000 | 20,000 | 0 | 0 | 0 |
Common stock issued for cash (in shares) | 5,000,000 | |||||
Net loss | (19,525) | $ 0 | 0 | 0 | (19,525) | 0 |
Ending Balance at Jul. 31, 2009 | 5,475 | $ 5,000 | 20,000 | 0 | (19,525) | 0 |
Ending Balance (in shares) at Jul. 31, 2009 | 5,000,000 | |||||
Common stock issued for cash | 30,000 | $ 3,000 | 27,000 | 0 | 0 | 0 |
Common stock issued for cash (in shares) | 3,000,000 | |||||
Net loss | (24,141) | $ 0 | 0 | 0 | (24,141) | 0 |
Ending Balance at Jul. 31, 2010 | 11,334 | $ 8,000 | 47,000 | 0 | (43,666) | 0 |
Ending Balance (in shares) at Jul. 31, 2010 | 8,000,000 | |||||
Net loss | (18,818) | $ 0 | 0 | 0 | (18,818) | 0 |
Ending Balance at Jul. 31, 2011 | (7,484) | $ 8,000 | 47,000 | 0 | (62,484) | 0 |
Ending Balance (in shares) at Jul. 31, 2011 | 8,000,000 | |||||
Sale of Goa Excursion | 20,460 | $ 0 | 20,460 | 0 | 0 | 0 |
Donated rent | 1,500 | 0 | 1,500 | 0 | 0 | 0 |
Net loss | (30,944) | 0 | 0 | 0 | (30,944) | 0 |
Ending Balance at Jul. 31, 2012 | (16,468) | $ 8,000 | 68,960 | 0 | (93,428) | 0 |
Ending Balance (in shares) at Jul. 31, 2012 | 8,000,000 | |||||
Donated rent | 6,000 | $ 0 | 6,000 | 0 | 0 | 0 |
Contribution from shareholders | 1,629,983 | 0 | 1,629,983 | 0 | 0 | 0 |
Other comprehensive income | 472 | 0 | 0 | 0 | 0 | 472 |
Net loss | (87,589) | 0 | 0 | 0 | 87,589 | 0 |
Ending Balance at Jul. 31, 2013 | 1,532,398 | $ 8,000 | 1,704,943 | 0 | (181,017) | 472 |
Ending Balance (in shares) at Jul. 31, 2013 | 8,000,000 | |||||
Donated rent | 6,000 | $ 0 | 6,000 | 0 | 0 | 0 |
Contribution from shareholders | 8,013,774 | 0 | 8,013,774 | 0 | 0 | 0 |
Other comprehensive income | 7,552 | 0 | 0 | 0 | 0 | 7,552 |
Common stock issued | 0 | $ 317,000 | 0 | (317,000) | 0 | 0 |
Common stock issued (in shares) | 317,000,000 | |||||
Common stock issued for the acquisition of Sanhe | 0 | $ 273,042 | (273,042) | 0 | 0 | 0 |
Common stock issued for the acquisition of Sanhe (in shares) | 273,042,000 | |||||
Net loss | (681,194) | $ 0 | 0 | 0 | (681,194) | 0 |
Ending Balance at Jul. 31, 2014 | 8,878,530 | $ 598,042 | $ 9,451,675 | $ (317,000) | $ (862,211) | $ 8,024 |
Ending Balance (in shares) at Jul. 31, 2014 | 598,042,000 | |||||
Net loss | (690,899) | |||||
Ending Balance at Apr. 30, 2015 | $ 8,216,699 |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows - USD ($) | 9 Months Ended | 12 Months Ended | ||
Apr. 30, 2015 | Apr. 30, 2014 | Jul. 31, 2014 | Jul. 31, 2013 | |
Cash flows from operating activities: | ||||
Net loss | $ (690,899) | $ (327,600) | $ (681,194) | $ (87,589) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||||
Depreciation | 310,560 | 0 | 74,053 | 0 |
Deferred tax asset | (185,177) | (38,261) | ||
Rent contributed by shareholders as paid-in capital | 4,500 | 4,500 | ||
Changes in operating assets and liabilities: | ||||
Accounts receivable | (808,753) | 0 | ||
Other receivables | (327,150) | (118,931) | (24,235) | 0 |
Prepayment | 2,089,024 | 0 | (7,630,372) | 0 |
Inventory | (367,649) | 0 | (9,825,555) | 0 |
Prepaid expense | 0 | 36,463 | ||
Deferred tax asset | (113,932) | 0 | ||
Due from related party | (404,376) | (2,289) | ||
Other current asset | (2,713,042) | 0 | (1,146,785) | |
Accounts payable and accrued liabilities | 2,265,143 | (6,335,552) | 69,893 | 1,500 |
Billings in excess of costs | 2,765,916 | 0 | ||
Other payables and tax payables | 277,548 | 13,035 | 105,623 | (1,755) |
Advance from customers | 142,441 | 596,717 | ||
Capital lease interest payable to related parties | 119,631 | 0 | ||
Amount due to related parties | (2,336,613) | 0 | ||
Advance billings on contracts | 12,052,437 | 0 | ||
Advance from shareholders | (50,165) | 0 | ||
Net cash provided by (used in) operating activities | 141,104 | (6,208,381) | (7,170,232) | (51,381) |
Cash flows from investing activities: | ||||
Purchase of property and equipment | (64,505) | (3,568,514) | (5,792,087) | 0 |
Net cash provided by (used in) investing activities | (64,505) | (3,568,514) | (5,792,087) | 0 |
Cash flows from financing activities: | ||||
Repayment of advances from related parties | 0 | 1,969,738 | ||
Advances from related parties | 3,046,744 | 27,010 | ||
Advances from director | (13,031) | 14,974 | 421,665 | 8,996 |
Advances from shareholders | 19,287 | 0 | ||
Capital contribution from shareholders | 0 | 6,413,031 | 8,019,775 | 1,641,983 |
Net cash (used in)/provided by financing activities | (13,031) | 8,397,743 | 11,507,471 | 1,677,989 |
Effect of exchange rate change on cash | (128,699) | 122,617 | 371,629 | 13,302 |
Net change in cash and cash equivalents | (65,131) | (1,256,535) | (1,083,219) | 1,639,910 |
Cash and cash equivalents - beginning of period | 556,788 | 1,640,007 | 1,640,007 | 97 |
Cash and cash equivalents - end of period | $ 491,657 | $ 383,472 | $ 556,788 | $ 1,640,007 |
NATURE OF OPERATIONS
NATURE OF OPERATIONS | 9 Months Ended | 12 Months Ended |
Apr. 30, 2015 | Jul. 31, 2014 | |
NATURE OF OPERATIONS | ||
NATURE OF OPERATIONS | Xiangtian (USA) Air Power Co., Ltd. (the “Company”) was incorporated in the State of Delaware on September 2, 2008 as Goa Sweet Tours Ltd. The Company was originally formed to provide personalized concierge tour packages to tourists who visit the State of Goa, India. On April 17, 2012, the Company entered into Share Purchase Agreements, by and among, Luck Sky International Investment Holdings Limited (“Luck Sky”), an entity owned and controlled by Zhou Deng Rong, and certain of our former stockholders who owned, in the aggregate, 7,200,000 90 235,000 On May 25, 2012, the Company formed a wholly-owned subsidiary corporation under the laws of the State of Delaware called Xiangtian (USA) Air Power Co., Ltd. ("Merger Sub"). Effective as of May 29, 2012, Merger Sub was merged with and into the Company. As a result of the merger, the Company’s name was changed to “Xiangtian (USA) Air Power Co., Ltd.” Prior to the merger, Merger Sub had no liabilities and nominal assets and, as a result of the merger, the separate existence of the Merger Sub ceased. The Company was the surviving corporation in the merger and, except for the name change provided for in the Agreement and Plan of Merger, there was no change in the directors, officers, capital structure or business of the Company. On September 15, 2013, the Company entered into an acquisition agreement by means of a merger of LuckSky (Hong Kong) Shares Limited (“HK Shares”), a Hong Kong corporation, for 250,000,000 On May 30, 2014, the Company entered into a Stock Purchase Agreement and acquired 100 On July 25, 2014, Luck Sky (Shen Zhen) Aerodynamic Electricity Limited (“Luck Sky Shen Zhen”), a corporation incorporated under the laws of the People Republic of China (“PRC”), an indirect wholly-owned subsidiary; Sanhe City Lucksky Electrical Engineering Co., Ltd. (“Sanhe”), a corporation incorporated under the laws of the PRC; and Mr. Zhou Jian and Mr. Zhou Deng Rong, the owners of 97 3 Simultaneously, the Company entered into a common stock purchase agreement with Zhou Jian and Zhou Deng Rong, the owners of 97% and 3%, respectively, of Sanhe, in consideration for the execution of the VIE Agreements and the acquisition of Sanhe. Pursuant to the Stock Purchase Agreement, the Company issued Zhou Jian and Zhou Deng Rong 264,850,740 8,191,260 45.7 | NOTE 1 - NATURE OF OPERATIONS Xiangtian (USA) Air Power Co., Ltd. (the “Company”) was incorporated in the State of Delaware on September 2, 2008 as Goa Sweet Tours Ltd. The Company was originally formed to provide personalized concierge tour packages to tourists who visit the State of Goa, India. On April 17, 2012, the Company entered into Share Purchase Agreements, by and among, Luck Sky International Investment Holdings Limited (“Lucky Sky”), an entity owned and controlled by Zhou Deng Rong, and certain of our former stockholders who owned, in the aggregate, 7,200,000 shares of the Company’s common stock (90% of the at then outstanding shares). Luck Sky purchased all 7,200,000 shares for an aggregate of $ 235,000 On May 1, 2012, the Company sold its Indian subsidiary, Goa Excursion Private Limited (“Goa Excursion”), to Iqbal Boga for a total value of $ 10 On May 25, 2012, the Company formed a corporation under the laws of the State of Delaware called Xiangtian (USA) Air Power Co., Ltd. ("Merger Sub") and on the same day, acquired one hundred shares of Merger Sub's common stock for cash. As such, Merger Sub became a wholly-owned subsidiary of the Company. Effective as of May 29, 2012, Merger Sub was merged with and into the Company. As a result of the merger, the Company’s name was changed to “Xiangtian (USA) Air Power Co., Ltd.”. Prior to the merger, Merger Sub had no liabilities and nominal assets and, as a result of the merger, the separate existence of the Merger Sub ceased. The Company was the surviving corporation in the merger and, except for the name change provided for in the Agreement and Plan of Merger, there was no change in the directors, officers, capital structure or business of the Company. On September 15, 2013, the Company entered into an acquisition agreement by means of a merger of LuckSky (Hong Kong) Shares Limited (“HK Shares”), a Hong Kong corporation, for 250,000,000 On May 30, 2014, the Company entered into a Stock Purchase Agreement and acquired 100 On July 25, 2014, Luck Sky (Shen Zhen) Aerodynamic Electricity Limited (“Luck Sky Shen Zhen”), a corporation incorporated under the laws of the People Republic of China (“PRC”), an indirect wholly-owned subsidiary; Sanhe City Lucksky Electrical Engineering Co., Ltd. (“Sanhe”), a corporation incorporated under the laws of the PRC; and Mr. Zhou Jian and Mr. Zhou Deng Rong, the owners of 97 3 Simultaneously, the Company entered into a common stock purchase agreement with Zhou Jian and Zhou Deng Rong, the owners of 97% and 3%, respectively, of Sanhe in consideration for the execution of the VIE Agreements and the acquisition of Sanhe. Pursuant to the Stock Purchase Agreement, the Company issued Zhou Jian and Zhou Deng Rong 264,850,740 8,191,260 45.7 |
BASIS OF PRESENTATION AND SUMMA
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended | 12 Months Ended |
Apr. 30, 2015 | Jul. 31, 2014 | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 - BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The consolidated financial statements include the financial statements of the Company, its subsidiaries, including the wholly-foreign owned enterprise ("WOFE"), and VIEs for which the Company is deemed the primary beneficiary. The consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America. This basis of accounting involves the application of accrual accounting and consequently, revenues and gains are recognized when earned, and expenses and losses are recognized when incurred. The Company’s consolidated financial statements are expressed in U.S. dollars. The preparation of consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates. The accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles (GAAP) applicable to interim financial information and the requirements of Form 10-Q and Rule 8-03 of Regulation S-X of the Securities and Exchange Commission. Accordingly, they do not include all of the information and disclosure required by accounting principles generally accepted in the United States of America for complete financial statements. Interim results are not necessarily indicative of results for a full year. In the opinion of management, all adjustments considered necessary for a fair presentation of the financial position and the results of operations and cash flows for the interim periods have been included. These interim financial statements should be read in conjunction with the audited financial statements for the year ended July 31, 2014, as not all disclosures required by generally accepted accounting principles for annual financial statements are presented. The interim financial statements follow the same accounting policies and methods of computations as the audited financial statements for the year ended July 31, 2014. These interim financial statements should be read in conjunction with the audited financial statements for the year ended July 31, 2014, as not all disclosures required by generally accepted accounting principles for annual financial statements are presented. The interim financial statements follow the same accounting policies and methods of computations as the audited financial statements for the year ended July 31, 2014. Certain amounts in the prior period financial statements have been reclassified to conform to the current period presentation. These reclassifications had no effect on reported net income or losses. The consolidated financial statements include the accounts of the Company, its subsidiaries and VIE for which it is deemed the primary beneficiary. All significant inter-company accounts and transactions have been eliminated in consolidation. The Company evaluates the need to consolidate its VIE in which equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support. The VIE agreement was not consummated until July 25, 2014, however, the purpose and design of the establishment of VIE, Sanhe, was to be consolidated under the Company through common control. ASC 810-10-25-38F states that a reporting entity’s involvement in the design of a VIE may indicate that the reporting entity had the opportunity and the incentive to establish arrangements that result in the reporting entity being the variable interest holder with the power to direct the activities that most significantly impact the VIE’s economic performance. As both the Company and the acquired VIE, Sanhe, are under the common control of Zhou Dengrong and Zhou Jian immediately before and after the acquisition, this transaction was accounted for as a merger under common control, using merger accounting as if the merger had been consummated at the beginning of the earliest period presented, and no gain or loss was recognized. All the assets and liabilities of the VIE, Sanhe, are recorded at carrying value. Hence, Sanhe was consolidated under the Company since its inception due to the purpose and design of its establishment. Details of the typical VIE structure of the Company's significant VIEs, primarily domestic companies associated with the operations of Sanhe, are set forth below: ⋅ Framework Agreement on Business Cooperation, entered between Luck Sky Shen Zhen and Sanhe, pursuant to which Luck Sky Shen Zhen and Sanhe have agreed to enter into a series of VIE agreements and to cooperate in all prospective of Sanhe’s business operation and management ⋅ Exclusive Management, Consulting and Training and Technical Service Agreement, entered between Luck Sky Shen Zhen and Sanhe, pursuant to which Luck Sky Shen Zhen has agreed to provide Sanhe with complete business support and technical support and related management, training and consulting services. In consideration for such services, Luck Sky Shen Zhen is entitled to receive an amount equal to 100 ⋅ Exclusive Option Agreement, entered among Luck Sky HK, Luck Sky Shen Zhen, Zhou Deng Rong, Zhou Jian and Sanhe, pursuant to which Zhou Deng Rong and Zhou Jian, the owners of Sanhe, have granted to Luck Sky Shen Zhen and Luck Sky HK the irrevocable right and option to acquire all of their equity interests in Sanhe. ⋅ Equity Pledge Agreement, entered among Luck Sky Shen Zhen, Zhou Deng Rong, Zhou Jian, and Sanhe, pursuant to which Zhou Deng Rong and Zhou Jian, the owners of Sanhe, have pledged all of their rights, titles and interests in Sanhe to Luck Sky Shen Zhen to guarantee Sanhe’s performance of its obligations under all the other VIE Agreements ⋅ Know-How Sub-License Agreement, entered between Luck Sky Shen Zhen and Sanhe, pursuant to which Luck Sky Shen Zhen has granted Sanhe an exclusive right to use and develop a series of aerodynamics related patents and technologies with respect to electrical generation for commercial and residential structures, not including automobile and wind towers. Luck Sky Shen Zhen possesses the rights licensed under this agreement through two license agreements dated July 25, 2014 with Zhou Deng Rong, Zhou Jian and Lucksky Group, the owners of the aforesaid patents and technologies. For the sublicense contemplated under this Agreement, Sanhe will pay Luck Sky Shen Zhen an annual royalty fee of five percent of revenue; and ⋅ Power of Attorney. Pursuant to a power of attorney, each of the Sanhe stockholders agreed to irrevocably entrust Luck Sky Shen Zhen with his stockholder voting rights and other stockholder rights for representing him to exercise such rights at the stockholders’ meeting of Sanhe in accordance with applicable laws and its Article of Association, including, but not limited to, the right to sell or transfer all or any of his equity interest in Sanhe, and appoint and vote for the directors and Chairman of Sanhe as the authorized representative of the Sanhe stockholders. The term of each proxy and voting agreement is as long as each of the Sanhe stockholders is a shareholder of Sanhe and is binding on any transferee. Under the contractual arrangements with the VIEs, the Company has the power to direct activities of the VIEs and can have assets transferred out of the VIE under its control. Therefore, the Company considers that there is no asset in any of the consolidated VIE that can be used only to settle obligations of the VIE, except for registered capital and PRC statutory reserves. As all consolidated VIEs are incorporated as limited liability companies under the PRC Company Law, creditors of the VIE do not have recourse to the general credit of the Company for any of the liabilities of the consolidated VIE. The Company’s total assets and liabilities presented in the consolidated financial statements represent substantially all of total assets and liabilities of the VIE because the other entities in the consolidation are non-operating holding entities with nominal assets and liabilities. The following financial statement amounts and balances of the VIE, which is established on August 6, 2014, were included in the accompanying consolidated financial statements as of April 30, 2015 and July 31, 2014 and for the nine months ended April 30, 2015 and 2014, respectively: April 30, 2015 July 31, 2014 Total assets $ 21,401,700 $ 17,666,510 Total liabilities 12,621,604 8,821,079 For the nine For the nine Ended ended April 30, 2015 April 30, 2014 Net loss $ 559,947 $ 327,085 The Company applies the provisions of ASC Subtopic 820-10, “Fair Value Measurements”, for fair value measurements of financial assets and financial liabilities and for fair value measurements of nonfinancial items that are recognized or disclosed at fair value in the financial statements. ASC 820 also establishes a framework for measuring fair value and expands disclosures about fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Company considers the principal or most advantageous market in which it would transact and it considers assumptions that market participants would use when pricing the asset or liability. ASC 820 establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes three levels of inputs that may be used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to measurements involving significant unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows: ⋅ Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. ⋅ Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the assets or liability, either directly or indirectly, for substantially the full term of the financial instruments. ⋅ Level 3 inputs to the valuation methodology are unobservable and significant to the fair value. There were no assets or liabilities measured at fair value on a recurring basis subject to the disclosure requirements of ASC 820 as of April 30, 2015 and July 31, 2014 . The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. Inventory is stated at the lower of cost or market. Cost is principally determined using the weighted average basis. Construction costs incurred on contracts are included in inventories which consist of raw materials, accessory parts, and contracts work in progress. Costs in excess of billings represent unbilled amounts earned and reimbursable under contracts. These amounts become billable according to the contract terms, which usually consider the passage of time, achievement of milestones or completion of the project. Generally, such unbilled amounts will be billed and collected over the next twelve months. There was no cost in excess of billings for the periods ended April 30, 2015 and July 31, 2014. Billings in Excess of Costs: Billings in excess of costs is comprised of cash collected from customers and billings to customers on contracts in advance of work performed, including advance payments negotiated as a contract condition. Generally, unearned project-related costs will be earned over the next twelve months. Property and equipment Property and equipment are stated at cost less accumulated depreciation and impairment losses. Gains or losses on dispositions of property and equipment are included in operating income (loss). Major additions, renewals and betterments are capitalized, while maintenance and repairs are expensed as incurred. Depreciation and amortization are provided over the estimated useful lives of the assets using the straight-line method from the time the assets are placed in service. Classification Estimated useful life Machinery equipment 5 10 Computer and office equipment 3 Vehicle 5 Property under capital lease 20 Sales of power generation system in conjunction of system installation are recognized under accounting for construction-type contracts, using the completed contract method because reliable estimates are not available for the costs and efforts necessary to complete the construction. Accordingly, revenue is recognized upon the completion of the construction, provided persuasive evidence of an arrangement exists, title and risk of loss has transferred, the fee is fixed and determinable, and collection is reasonably assured. We provide for any loss that we expect to incur on these contracts when that loss is probable. The Company generally provides limited warranties for work performed under its contracts. The warranty periods typically extend for a limited duration following substantial completion of the Company's work on a project. At the time a sale is recognized, we record estimated future warranty costs. Such estimated costs for warranties are included in the individual project cost estimates for purposes of accounting for long-term contracts. The warranty cost is estimated based on our experience with the type of work and any known risks relative to the project and was not material during the periods ended April 30, 2015 and 2014. No right of return exists on sales of equipment. Replacement part returns are estimable and accrued at the time a sale is recognized. The Company is subject to VAT at a rate of 17 The Company accounts for income taxes using an asset and liability approach which allows for the recognition and measurement of deferred tax assets based upon the likelihood of realization of tax benefits in future years. Under the asset and liability approach, deferred taxes are provided for the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. A valuation allowance is provided for deferred tax assets if it is more likely than not these items will either expire before the Company is able to realize their benefits, or that future deductibility is uncertain. Under ASC 740, a tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The evaluation of a tax position is a two-step process. The first step is to determine whether it is more-likely-than-not that a tax position will be sustained upon examination, including the resolution of any related appeals or litigations based on the technical merits of that position. The second step is to measure a tax position that meets the more-likely-than-not threshold to determine the amount of benefit to be recognized in the financial statements. A tax position is measured at the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate settlement. Tax positions that previously failed to meet the more-likely-than-not recognition threshold should be recognized in the first subsequent period in which the threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not criteria should be de-recognized in the first subsequent financial reporting period in which the threshold is no longer met. Penalties and interest incurred related to underpayment of income tax are classified as income tax expense in the year incurred. No significant penalties or interest relating to income taxes have been incurred during the period from July 8, 2013 (inception) to December 31, 2013. US GAAP also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosures and transition. The Company follows the provisions of the Financial Accounting Standards Board (the “FASB”) Accounting Standards Codification (“ASC”) 220 “Reporting Comprehensive Income”, and establishes standards for the reporting and display of comprehensive income, its components and accumulated balances in a full set of general purpose financial statements. The Company’s functional currency is Chinese Renminbi (“RMB”) as substantially all of the Company’s PRC subsidiaries’ operations use this denomination. The consolidated financial statements are presented in U.S. dollars. Foreign denominated monetary assets and liabilities are translated into their United States dollar equivalents using foreign exchange rates which prevailed at the balance sheet date. Non-monetary assets and liabilities are translated at the exchange rates prevailing at the transaction date. Revenues and expenses are translated at average rates of exchange during the year. Gains or losses resulting from foreign currency transactions are included in results of operations. For the purpose of presenting these financial statements of subsidiaries in PRC, the Company’s assets and liabilities are expressed in US$ at the exchange rate on the balance sheet date, which is 6.2018 6.2164 6.1824 6.1168 For the purpose of presenting these financial statements of subsidiaries in Hong Kong, PRC, the Company’s assets and liabilities are expressed in US$ at the exchange rate on the balance sheet date, which is 7.7513 7.7497 7.7540 7.7556 Basic earnings per share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding during the period, excluding the effects of any potentially dilutive securities. Diluted earnings per share gives effect to all dilutive potential of shares of common stock outstanding during the period including stock options or warrants, using the treasury stock method (by using the average stock price for the period to determine the number of shares assumed to be purchased from the exercise of stock options or warrants), and convertible debt or convertible preferred stock, using the if-converted method. Earnings per share exclude all potential dilutive shares of common stock if their effect is anti-dilutive. There were no potential dilutive securities at April 30, 2015 or April 30 , 2014. Certain comparative amounts for the prior period have been reclassified to conform to current period presentations. Such reclassifications had no effect on net income or shareholders’ equity. In February 2015, FASB issued ASU No. 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis. The new consolidation standard changes the way reporting enterprises evaluate whether (a) they should consolidate limited partnerships and similar entities, (b) fees paid to a decision maker or service provider are variable interests in a VIE, and (c) variable interests in a VIE held by related parties of the reporting enterprise require the reporting enterprise to consolidate the VIE. The guidance is effective for public business entities for annual and interim periods in fiscal years beginning after December 15, 2015. Early adoption is allowed, including early adoption in an interim period. A reporting entity may apply a modified retrospective approach by recording a cumulative-effect adjustment to equity as of the beginning of the fiscal year of adoption or may apply the amendments retrospectively. The Company is currently assessing the impact of the adoption of this guidance on the consolidated financial statements. In August 2014, the Financial Accounting Standards Board issued ASU No. 2014-15, Presentation of Financial Statements Going Concern (Subtopic 205-40). This standard is intended to define management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures. The amendments contained in this ASU apply to all companies and not-for-profit organizations. The amendments are effective for the annual period ending after December 15, 2016, and for annual and interim periods thereafter. Early application is permitted. The Company is currently assessing this ASU’s impact on the Company’s consolidated results of operations and financial condition. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers The Company believes that there were no other accounting standards recently issued that had or are expected to have a material impact on our financial position or results of operations. | NOTE 2 - BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America. This basis of accounting involves the application of accrual accounting and consequently, revenues and gains are recognized when earned, and expenses and losses are recognized when incurred. The Company’s consolidated financial statements are expressed in U.S. dollars. The preparation of consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates. The consolidated financial statements include the financial statements of the Company, its subsidiaries, including the wholly-foreign owned enterprise ("WOFE"), and VIEs for which the Company is deemed the primary beneficiary. The Company evaluates the need to consolidate its VIE in which equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support. The VIE agreement was not consummated until July 25, 2014, however, the purpose and design of the establishment of VIE, Sanhe, was to be consolidated under the Company through common control. ASC 810-10-25-38F states that a reporting entity’s involvement in the design of a VIE may indicate that the reporting entity had the opportunity and the incentive to establish arrangements that result in the reporting entity being the variable interest holder with the power to direct the activities that most significantly impact the VIE’s economic performance. As both the Company and the acquired VIE, Sanhe, are under the common control of Zhou Deng Rong and Zhou Jian immediately before and after the acquisition, this transaction was accounted for as a merger under common control, using merger accounting as if the merger had been consummated at the beginning of the earliest period presented, and no gain or loss was recognized. All the assets and liabilities of the VIE, Sanhe, are recorded at carrying value. Hence, Sanhe was consolidated under the Company since its inception due to the purpose and design of its establishment. Details of the typical VIE structure of the Company's significant VIEs, primarily domestic companies associated with the operations of Sanhe, are set forth below: ⋅ Framework Agreement on Business Cooperation, entered between Luck Sky Shen Zhen and Sanhe, pursuant to which Luck Sky Shen Zhen and Sanhe have agreed to enter into a series of VIE agreements and to cooperate in all prospective of Sanhe’s business operation and management ⋅ Exclusive Management, Consulting and Training and Technical Service Agreement, entered between Luck Sky Shen Zhen and Sanhe, pursuant to which Luck Sky Shen Zhen has agreed to provide Sanhe with complete business support and technical support and related management, training and consulting services. In consideration for such services, Luck Sky Shen Zhen is entitled to receive an amount equal to 100 ⋅ Exclusive Option Agreement, entered among Luck Sky HK, Luck Sky Shen Zhen, Zhou Deng Rong, Zhou Jian and Sanhe, pursuant to which Zhou Deng Rong and Zhou Jian, the owners of Sanhe, have granted to Luck Sky Shen Zhen and Luck Sky HK the irrevocable right and option to acquire all of their equity interests in Sanhe. ⋅ Equity Pledge Agreement, entered among Luck Sky Shen Zhen, Zhou Deng Rong, Zhou Jian, and Sanhe, pursuant to which Zhou Deng Rong and Zhou Jian, the owners of Sanhe, have pledged all of their rights, titles and interests in Sanhe to Luck Sky Shen Zhen to guarantee Sanhe’s performance of its obligations under all the other VIE Agreements ⋅ Know-How Sub-License Agreement, entered between Luck Sky Shen Zhen and Sanhe, pursuant to which Luck Sky Shen Zhen has granted Sanhe an exclusive right to use and develop a series of aerodynamics related patents and technologies with respect to electrical generation for commercial and residential structures, not including automobile and wind towers. Luck Sky Shen Zhen possesses the rights licensed under this agreement through two license agreements dated July 25, 2014 with Zhou Deng Rong, Zhou Jian and Lucksky Group, the owners of the aforesaid patents and technologies. For the sublicense contemplated under this Agreement, Sanhe will pay Luck Sky Shen Zhen an annual royalty fee of five percent of revenue; and ⋅ Power of Attorney. Pursuant to a power of attorney, each of the Sanhe stockholders agreed to irrevocably entrust Luck Sky Shen Zhen with his stockholder voting rights and other stockholder rights for representing him to exercise such rights at the stockholders’ meeting of Sanhe in accordance with applicable laws and its Article of Association, including, but not limited to, the right to sell or transfer all or any of his equity interest in Sanhe, and appoint and vote for the directors and Chairman of Sanhe as the authorized representative of the Sanhe stockholders. The term of each proxy and voting agreement is as long as each of the Sanhe stockholders is a shareholder of Sanhe and is binding on any transferee. Under the contractual arrangements with the VIEs, the Company has the power to direct activities of the VIEs and can have assets transferred out of the VIE under its control. Therefore, the Company considers that there is no asset in any of the consolidated VIE that can be used only to settle obligations of the VIE, except for registered capital and PRC statutory reserves. As all consolidated VIEs are incorporated as limited liability companies under the PRC Company Law, creditors of the VIE do not have recourse to the general credit of the Company for any of the liabilities of the consolidated VIE. The Company’s total assets and liabilities presented in the consolidated financial statements represent substantially all of total assets and liabilities of the VIE because the other entities in the consolidation are non-operating holding entities with nominal assets and liabilities. July 31, 2014 Total assets $ 26,927,076 Total liabilities 17,610,720 For the year ended July 31,2014 Net loss $ 455,727 The Company applies the provisions of ASC Subtopic 820-10, “Fair Value Measurements”, for fair value measurements of financial assets and financial liabilities and for fair value measurements of nonfinancial items that are recognized or disclosed at fair value in the financial statements. ASC 820 also establishes a framework for measuring fair value and expands disclosures about fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Company considers the principal or most advantageous market in which it would transact and it considers assumptions that market participants would use when pricing the asset or liability. ASC 820 establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes three levels of inputs that may be used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to measurements involving significant unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows: ¨ Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. ¨ Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the assets or liability, either directly or indirectly, for substantially the full term of the financial instruments. ¨ Level 3 inputs to the valuation methodology are unobservable and significant to the fair value. There were no assets or liabilities measured at fair value on a recurring basis subject to the disclosure requirements of ASC 820 as of July 31, 2014 and 2013. The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. Inventory is stated at the lower of cost or market. Cost is principally determined using the weighted average basis. Construction costs incurred on contracts are included in inventories which consist of raw materials, accessory parts, and contracts work in progress. Property and equipment are stated at cost less accumulated depreciation and impairment losses. Gains or losses on dispositions of property and equipment are included in operating income (loss). Major additions, renewals and betterments are capitalized, while maintenance and repairs are expensed as incurred. Depreciation and amortization are provided over the estimated useful lives of the assets using the straight-line method from the time the assets are placed in service. Classification Estimated useful life Machinery equipment 5 10 Computer and office equipment 3 Vehicle 5 Property under capital lease 20 Sales of power generation system in conjunction of system installation are recognized under accounting for construction-type contracts, using the completed contract method. Accordingly, revenue is recognized upon the completion of the construction, provided persuasive evidence of an arrangement exists, title and risk of loss has transferred, the fee is fixed and determinable, and collection is reasonably assured. We provide for any loss that we expect to incur on these contracts when that loss is probable. The Company generally provides limited warranties for work performed under its contracts. The warranty periods typically extend for a limited duration following substantial completion of the Company's work on a project. At the time a sale is recognized, we record estimated future warranty costs. Such estimated costs for warranties are included in the individual project cost estimates for purposes of accounting for long-term contracts. Generally, the estimated claim rates of warranty are based on actual warranty experience or Company’s best estimate. No right of return exists on sales of equipment. Replacement part returns are estimable and accrued at the time a sale is recognized. The Company is subject to VAT at a rate of 17 The Company accounts for income taxes using an asset and liability approach which allows for the recognition and measurement of deferred tax assets based upon the likelihood of realization of tax benefits in future years. Under the asset and liability approach, deferred taxes are provided for the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. A valuation allowance is provided for deferred tax assets if it is more likely than not these items will either expire before the Company is able to realize their benefits, or that future deductibility is uncertain. Under ASC 740, a tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The evaluation of a tax position is a two-step process. The first step is to determine whether it is more-likely-than-not that a tax position will be sustained upon examination, including the resolution of any related appeals or litigations based on the technical merits of that position. The second step is to measure a tax position that meets the more-likely-than-not threshold to determine the amount of benefit to be recognized in the financial statements. A tax position is measured at the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate settlement. Tax positions that previously failed to meet the more-likely-than-not recognition threshold should be recognized in the first subsequent period in which the threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not criteria should be de-recognized in the first subsequent financial reporting period in which the threshold is no longer met. Penalties and interest incurred related to underpayment of income tax are classified as income tax expense in the year incurred. No significant penalties or interest relating to income taxes have been incurred during the period from July 8, 2013 (inception) to December 31, 2013. US GAAP also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosures and transition. The Company follows the provisions of the Financial Accounting Standards Board (the “FASB”) Accounting Standards Codification (“ASC”) 220 “Reporting Comprehensive Income”, and establishes standards for the reporting and display of comprehensive income, its components and accumulated balances in a full set of general purpose financial statements. The Company’s functional currency is Chinese Renminbi (“RMB”) as substantially all of the Company’s PRC subsidiaries’ operations use this denomination. The consolidated financial statements are presented in U.S. dollars. Foreign denominated monetary assets and liabilities are translated into their United States dollar equivalents using foreign exchange rates which prevailed at the balance sheet date. Non-monetary assets and liabilities are translated at the exchange rates prevailing at the transaction date. Revenues and expenses are translated at average rates of exchange during the year. Gains or losses resulting from foreign currency transactions are included in results of operations. For the purpose of presenting these financial statements of subsidiaries in PRC, which were firstly consolidated in the fiscal year of 2014 , the Company’s assets and liabilities are expressed in US$ at the exchange rate on the balance sheet date, which is 6.2164 as of July 31, 2014; stockholder’s equity accounts are translated at historical rates, and income and expense items are translated at the weighted average exchange rate during the period, which is 6.1025 For the purpose of presenting these financial statements, the Company’s assets and liabilities are expressed in US$ at the exchange rate on the balance sheet date, which is 7.7497 and 7.7558 7.7545 7.7560 Basic earnings per share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding during the period, excluding the effects of any potentially dilutive securities. Diluted earnings per share gives effect to all dilutive potential of shares of common stock outstanding during the period including stock options or warrants, using the treasury stock method (by using the average stock price for the period to determine the number of shares assumed to be purchased from the exercise of stock options or warrants), and convertible debt or convertible preferred stock, using the if-converted method. Earnings per share excludes all potential dilutive shares of common stock if their effect is anti-dilutive. There were no potential dilutive securities at July 31, 2014 or 2013. In August 2014, the Financial Accounting Standards Board issued ASU No. 2014-15, Presentation of Financial Statements Going Concern (Subtopic 205-40). This standard is intended to define management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures. The amendments contained in this ASU apply to all companies and not-for-profit organizations. The amendments are effective for the annual period ending after December 15, 2016, and for annual and interim periods thereafter. Early application is permitted. The Company is currently assessing this ASU’s impact on the Company’s consolidated results of operations and financial condition. In June 2014, the FASB issued ASU No. 2014-10, Development Stage Entities (Topic 915): Elimination of Certain Financial Reporting Requirements, Including an Amendment to Variable Interest Entities Guidance in Topic 810, Consolidation. The amendments in this Update remove the definition of a development stage entity from the Master Glossary of the Accounting Standards Codification, thereby removing the financial reporting distinction between development stage entities and other reporting entities from U.S. GAAP. For public business entities, those amendments are effective for annual reporting periods beginning after December 15, 2014, and interim periods therein. Early application of each of the amendments is permitted for any annual reporting period or interim period for which the entity’s financial statements have not yet been issued (public business entities) or made available for issuance (other entities). Upon adoption, entities will no longer present or disclose any information required by Topic 915.The Company adopted this ASU as early application for the financial statements of the period from July8, 2013 (inception) to December 31, 2013. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers In February 2013, the FASB issued ASU No. 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income. Under this standard, an entity is required to provide information about the amounts reclassified out of accumulated other comprehensive income (“AOCI”) by component. In addition, an entity is required to present, either on the face of the financial statements or in the notes, significant amounts reclassified out of AOCI by the respective line items of net income, but only if the amount reclassified is required to be reclassified in its entirety in the same reporting period. For amounts that are not required to be reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures that provide additional details about those amounts. ASU 2013-02 does not change the current requirements for reporting net income or other comprehensive income in the financial statements. For the Company, this ASU is effective beginning January 1, 2013, and interim periods within those annual periods. The adoption of this standard is not expected to have an impact on the Company’s financial results or disclosures. In March 2013, the FASB issued ASU No. 2013-05, Parent’s Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity. This standard provides additional guidance with respect to the reclassification into income of the cumulative translation adjustment (CTA) recorded in accumulated other comprehensive income associated with a foreign entity of a parent company. The ASU differentiates between transactions occurring within investment in within within investment in The Company believes that there were no other accounting standards recently issued that had or are expected to have a material impact on our financial position or results of operations. |
GOING CONCERN
GOING CONCERN | 9 Months Ended | 12 Months Ended |
Apr. 30, 2015 | Jul. 31, 2014 | |
GOING CONCERN | ||
GOING CONCERN | NOTE 3 - GOING CONCERN The accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern. The Company has incurred losses since its inception resulting in an accumulated deficit of $ 1,553,110 The Company expects to finance operations primarily through cash flow from revenue and capital contributions from principal shareholders. In the event that we require additional funding to finance the growth of the Company’s current and expected future operations as well as to achieve our strategic objectives, our principal shareholders have indicated the intent and ability to provide additional equity financing. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. The Company’s continuation as a going concern is dependent on our ability to meet obligations as they become due and to obtain additional equity or alternative financing required to fund operations until sufficient sources of recurring revenues can be generated. There can be no assurance that the Company will be successful in its plans described above or in attracting equity or alternative financing on acceptable terms, or if at all. The financial statements do not include any adjustments that might result from the outcome of this- uncertainty. | NOTE 3 - GOING CONCERN The accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern. The Company has incurred losses since its inception resulting in an accumulated deficit of $862,211 as of July 31, 2014 and further losses are anticipated in the development of its business raising substantial doubt about the Company’s ability to continue as a going concern. The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and/or obtaining the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they become due. These consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. The Company expects to finance operations primarily through cash flow from revenue and capital contributions from principal shareholders. In the event that we require additional funding to finance the growth of the Company’s current and expected future operations as well as to achieve our strategic objectives, our principal shareholders have indicated the intent and ability to provide additional equity financing. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. The Company’s continuation as a going concern is dependent on our ability to meet obligations as they become due and to obtain additional equity or alternative financing required to fund operations until sufficient sources of recurring revenues can be generated. There can be no assurance that the Company will be successful in its plans described above or in attracting equity or alternative financing on acceptable terms, or if at all. The financial statements do not include any adjustments that might result from the outcome of this- uncertainty. |
RESTATEMENT OF CONSOLIDATED FIN
RESTATEMENT OF CONSOLIDATED FINANCIAL STATEMENTS | 9 Months Ended | 12 Months Ended |
Apr. 30, 2015 | Jul. 31, 2014 | |
RESTATEMENT OF CONSOLIDATED FINANCIAL STATEMENTS | ||
RESTATEMENT OF CONSOLIDATED FINANCIAL STATEMENTS | RESTATEMENT OF CONSOLIDATED FINANCIAL STATEMENTS The Company corrected the accounting treatment regarding the omission of subscription receivables in the consolidated financial statements in the aggregate amount of $ 317,000 In addition to the restatement of our consolidated financial statements, we have also restated the following items to reflect certain changes noted above. Note 1 - NATURE OF OPERATIONS Note 2 - BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Note 5 - ACQUISITIONS Note 9 - RELATED PARTY TRANSACTIONS Note 12 - CAPITAL STOCK AND EQUITY TRANSACTIONS Note 14 - COMMITMENTS, CONTINGENCIES, RISKS AND UNCERTAINTIES As of and For the Period Ended April 30, 2015 Previously Adjustments Restated Consolidated Balance Sheets STOCKHOLDERS’ EQUITY Common stock: $0.001 par value, 1,000,000,000 shares authorized, 598,042,000 shares issued and outstanding, respectively $ 531,042 $ 67,000 $ 598,042 Additional paid-in capital 9,206,175 250,000 9,456,175 Subscription receivable - (317,000) (317,000) Consolidated Statement of Operations and Comprehensive Loss For the three months ended April 30, 2015, Weighted average number of common shares outstanding - basic and diluted 591,042,000 67,000,000 598,042,000 For the nine months ended April 30, 2015, Weighted average number of common shares outstanding - basic and diluted 591,042,000 67,000,000 598,042,000 | NOTE 4 RESTATEMENT OF CONSOLIDATED FINANCIAL STATEMENTS The Company corrected the accounting treatment regarding the omission of subscription receivables in the consolidated financial statements in the aggregate amount of $317,000, and the made revision for the footnotes of acquisitions made with related parties whose identity and stock ownership had been previously disclosed and the consolidation of a variable interest entity to reflect a more accurate disclosure. In addition to the restatement of our consolidated financial statements, we have also restated the following items to reflect certain changes noted above. Note 1 - NATURE OF OPERATIONS Note 2 - BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Note 5 - ACQUISITIONS Note 8 - RELATED PARTY TRANSACTIONS Note 11 - CAPITAL STOCK AND EQUITY TRANSACTIONS Note 13 - COMMITMENTS, CONTINGENCIES, RISKS AND UNCERTAINTIES As of and For the Year Ended July 31, 2014 Previously Adjustments Restated Consolidated Balance Sheets STOCKHOLDERS’ EQUITY Common stock: $0.001 par value, 1,000,000,000 shares authorized, 598,042,000and 8,000,000 shares issued and outstanding, respectively $ 531,042 $ 67,000 $ 598,042 Additional paid-in capital 9,201,675 250,000 9,451,675 Subscription receivable - (317,000) (317,000) Consolidated Statement of Operations and Comprehensive Loss Weighted average number of common shares outstanding - basic and diluted 263,079,329 21,126,956 284,206,285 |
ACQUISITIONS
ACQUISITIONS | 9 Months Ended | 12 Months Ended |
Apr. 30, 2015 | Jul. 31, 2014 | |
ACQUISITIONS | ||
ACQUISITIONS | NOTE 5 ACQUISITIONS Acquisition of Luck Sky (Hong Kong) Shares Limited (“HK Shares”) On September 15, 2013, the Company entered into an agreement to acquire HK Shares, a Hong Kong corporation, for 250,000,000 41 250,000,000 0.001 250,000 HK Shares was formed in September 24, 2013 and issued 250,000,000 0.001 250,000 The Company valued the 250,000,000 250,000 0.001 Acquisition of Luck Sky (Hong Kong) Aerodynamic Electricity Limited (“Luck Sky HK”) In order to comply with the PRC laws, rules and regulations that restrict foreign ownership of PRC companies, the management of the Company has made the following arrangement to go public in the United States of America (the “Going Public Arrangement”). 100 10,000 Luck Sky HK and Luck Sky Shen Zhen, a wholly owned subsidiary of Luck Sky HK, had no operating business, no liabilities and nominal assets as of the date of the acquisition. As a result of the acquisition, Luck Sky HK became our wholly owned subsidiary and Luck Sky Shen Zhen became our indirect subsidiary through Luck Sky HK. Acquisition of Sanhe City Lucksky Electrical Engineering Co., Ltd. (“Sanhe”) As part of the Going Public Arrangement, on July 25, 2014, Luck Sky Shen Zhen, the Company’s indirectly wholly-owned subsidiary, Sanhe City Lucksky Electrical Engineering Co., Ltd. (“Sanhe”), a corporation incorporated under the laws of the PRC; Mr. Zhou Jian and Mr. Zhou Deng Rong, the owners of 97 3 Simultaneously, the Company entered into a common stock purchase agreement with Zhou Jian and Zhou Deng Rong, the owners of 97% and 3%, respectively, of Sanhe, in consideration for the execution of the VIE Agreements and the acquisition of Sanhe. Pursuant to such common stock purchase agreement, the Company issued Zhou Jian and Zhou Deng Rong 264,850,740 8,191,260 45.7 | NOTE 5 ACQUISITIONS Acquisition of Luck Sky (Hong Kong) Shares Limited (“HK Shares”) On September 15, 2013, the Company entered into an agreement to acquire HK Shares, a Hong Kong corporation, for 250,000,000 shares of common stock of the Company. Prior to the acquisition, HK Shares was majority owned (approximately 41%) by Mr. Zhou Deng Hua who is the brother of the former CEO of the Company and a director of the Company. On September 23, 2013, the Company issued 250,000,000 shares of common stock to the shareholders of HK Shares in exchange for 250,000,000 shares of HK Shares subscribed at $0.001 per share for a total amount of $250,000.At the completion of the acquisition, HK Shares was merged into the Company. HK Shares was formed in September 24, 2013 and issued 250,000,000 shares at $0.001 to 24 shareholders for a total of $250,000. The shares subscribed were to be paid up within two years from the date of subscription. On the date of the merger acquisition HK Shares had no operations other than the subscription receivable; and accordingly, the transaction was accounted for as an acquisition from related party. The Company valued the 250,000,000 shares of common stock issued at $250,000 as there was no market for the Company’s common stock and it has limited or no trading; and there is thought to be minimal value in the Company at the time, therefore the par value is thought to match the assumed market price of the Company’s common stock which is at $0.001 per share. Acquisition of Luck Sky (Hong Kong) Aerodynamic Electricity Limited (“Luck Sky HK”) In order to comply with the PRC laws, rules and regulations that restrict foreign ownership of PRC companies, the management of the Company has made the following arrangement to go public in the United States of America (the “Going Public Arrangement”). Luck Sky HK and Luck Sky Shen Zhen, a wholly owned subsidiary of Luck Sky HK, had no operating business, no liabilities and nominal assets as of the date of the acquisition. As a result of the acquisition, Luck Sky HK became our wholly owned subsidiary and Luck Sky Shen Zhen became our indirect subsidiary through Luck Sky HK. Acquisition of Sanhe City Lucksky Electrical Engineering Co., Ltd. (“Sanhe”) As part of the Going Public Arrangement, on July 25, 2014, Luck Sky Shen Zhen, the Company’s indirectly wholly-owned subsidiary, Sanhe City Lucksky Electrical Engineering Co., Ltd. (“Sanhe”), a corporation incorporated under the laws of the PRC; Mr. Zhou Jian and Mr. Zhou Deng Rong, the owners of 97% and 3%, respectively, of Sanhe; entered into a series of agreements known as VIE Agreements pursuant to which Sanhe became Luck Sky Shen Zhen’s affiliate through contractual control. The purpose and effect of the VIE Agreements is to provide Luck Sky Shen Zhen with all of the management, control and net profits of Sanhe. Simultaneously, the Company entered into a common stock purchase agreement with Zhou Jian and Zhou Deng Rong, the owners of 97% and 3%, respectively, of Sanhe, in consideration for the execution of the VIE Agreements and the acquisition of Sanhe. Pursuant to such common stock purchase agreement, the Company issued Zhou Jian and Zhou Deng Rong 264,850,740 and 8,191,260 shares, respectively, of our common stock, representing a total of 45.7% of the our issued and outstanding shares of common stock. |
INVENTORIES
INVENTORIES | 9 Months Ended | 12 Months Ended |
Apr. 30, 2015 | Jul. 31, 2014 | |
INVENTORIES | ||
INVENTORIES | NOTE 6 INVENTORIES April 30, July 31, 2015 2014 Raw materials $ 295,539 $ 115,839 Accessory parts 899,252 635,708 Contracts work in process 980,923 1,030,106 Total $ 2,175,714 $ 1,781,653 | NOTE 6 INVENTORIES July 31, July 31, 2014 2013 Raw materials $ 115,839 $ - Accessory parts 635,708 - Contracts work in progress 8,893,979 - Total $ 9,645,526 $ - |
PROPERTY, PLANT AND EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT | 9 Months Ended | 12 Months Ended |
Apr. 30, 2015 | Jul. 31, 2014 | |
PROPERTY, PLANT AND EQUIPMENT | ||
PROPERTY, PLANT AND EQUIPMENT | NOTE 7- PROPERTY, PLANT AND EQUIPMENT April 30, July 31, 2015 2014 Machinery equipment $ 5,281,800 $ 3,997,506 Computer and office equipment 56,630 59,316 Vehicle 74,205 38,558 Property under capital lease 2,763,062 2,756,573 Total property, plant and equipment 8,175,697 6,851,953 Less: accumulated depreciation (382,457) (72,697) Total $ 7,793,240 $ 6,779,256 Total depreciation expenses for the nine months ended April 30, 2015 and 2014 were $ 310,560 0 189,241 0 121,321 0 | NOTE 7- PROPERTY, PLANT AND EQUIPMENT July 31, July 31, 2014 2013 Machinery equipment $ 3,997,506 $ - Computer and office equipment 59,316 - Vehicle 38,558 Property under capital lease 2,756,573 - Total property, plant and equipment 6,851,953 - Less: accumulated depreciation (72,697) - Total $ 6,779,256 $ - Total depreciation expenses for the years ended July 30, 2014 and 2013 were $ 72,697 0 38,241 0 34,456 0 |
BILLINGS IN EXCESS OF COSTS
BILLINGS IN EXCESS OF COSTS | 9 Months Ended |
Apr. 30, 2015 | |
BILLINGS IN EXCESS OF COSTS | |
BILLINGS IN EXCESS OF COSTS | NOTE 8 BILLINGS IN EXCESS OF COSTS April 30, 2015 July 31, 2014 Costs incurred on uncompleted contracts $ 16,716,459 $ 7,863,873 Billings to date (23,380,309) (11,710,958) $ (6,663,850) $ (3,847,085) Included in the accompanying balance sheets as follows: Costs in excess of billings on uncompleted contracts $ - $ - Billings on uncompleted contracts in excess of costs (6,663,850) (3,847,085) $ (6,663,850) $ (3,847,085) |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended | 12 Months Ended |
Apr. 30, 2015 | Jul. 31, 2014 | |
RELATED PARTY TRANSACTIONS | ||
RELATED PARTY TRANSACTIONS | NOTE 9 - RELATED PARTY TRANSACTIONS Due from related parties On April 25, 2015, Sanhe entered into a loan agreement with Xiangtian Kelitai, Yanjiao Branch, a division of LuckSky Group, which is owned by Zhou Deng Rong, former CEO and Sanhe’s former general manager and former majority shareholder of the Company, with a total amount of $ 507,917 3,150,000 December 31, 2015 5 403,109 Due to related parties On July 25, 2014, prior to the Acquisition, Sanhe and Luck Sky Shen Zhen and Sanhe’s shareholders entered into a series of VIE Agreements, pursuant to which Sanhe became Luck Sky Shen Zhen’s contractually controlled affiliate. The VIE Agreements include the Framework Agreement on Business Cooperation, the Exclusive Management, Consulting and Training and Technical Services Agreement, the Exclusive Option Agreement, the Equity Pledge Agreement, the Know-How Sub-License Agreement and the Power-of-Attorney. The purpose and effect of the VIE Agreements is to provide Luck Sky Shen Zhen (the Company’s indirect wholly-owned subsidiary) with all of the management and control of Sanhe and all of its net income. While Luck Sky Shen Zhen does not actually own at present any of the equity and shares in Sanhe, the purpose and effect of the VIE Agreements is to instill in Luck Sky Shen Zhen total management and voting control of Sanhe for all material purposes. The use of VIE agreements is a common structure used to acquire PRC corporations, particularly in certain industries in which foreign investment is restricted or forbidden by the PRC government. On July 25, 2014, the Company entered into the Stock Purchase Agreement with Zhou Jian and Zhou Deng Rong, the owners of 97 3 264,850,740 8,191,260 45.7 On July 25, 2014, Luck Sky Shen Zhen obtained an exclusive, worldwide, royalty free license from Zhou Deng Rong and Zhou Jian (his son) and a second exclusive, worldwide royalty free license from LuckSky Group to an aggregate of 48 Chinese patents and related know how and trade secrets, including the technology underlying 13 patent applications (the “Technology”). The Technology represents all of the patents, patent applications and related know how and trade secrets owned by the licensors with respect to PV installations and the air energy storage power generation technology as applied to commercial and residential buildings, but not wind towers. On July 25, 2014, Luck Sky Shen Zhen granted Sanhe an exclusive sublicense with respect to the use of the Technology for commercial and residential buildings, but not for other uses, including wind towers, vehicles and trains, which sublicense also provides for a royalty payment to Luck Sky Shen Zhen equal of five percent of Sanhe’s revenues. The royalty payment was deferred. In May 2014, Sanhe entered into an agreement with Kelitai, to purchase some of Keizai’s fixed assets for the use in its own production. The total amount for the fixed assets and inventory was $ 1,261,872 7,844,300 0 1,235,667 On April 1, 2014, LuckSky Group loaned Sanhe $ 483,830 3,000,000 December 31, 2014 2,000,000 1,000,000 Prior to the incorporation of Sanhe, Kelitai Air Powered Machinery Co., Ltd. (“Kelitai”), a subsidiary of LuckSky Group, an entity owned by Zhou Deng Rong, our former CEO and Sanhe’s former general manager and former majority shareholder of the Company, executed various purchase agreements (the “Agreements”) with Beijing Hengruier Machinery Company Limited (“Hengruier”) and made certain prepayments on behalf of the Company. On July 15, 2013, Kelitai, Hengruier and the Company executed a tripartite agreement to transfer the rights and obligations of the Agreements to the Company. As of April 30, 2015, Kelitai has paid $ 1,242,198 0 1,242,198 On September 15, 2013, the Company entered into an agreement to acquire HK Shares, a Hong Kong corporation, for 250,000,000 41 250,000,000 0.001 250,000 HK Shares was formed in September 24, 2013 and issued 250,000,000 0.001 250,000 On May 30, 2014, the Company entered into the Stock Purchase Agreement with Zhou Jian, the sole shareholder of Luck Sky HK, a Hong Kong corporation, pursuant to which it purchased 100 10,000 On July 18, 2013, Sanhe borrowed $ 1,242,198 7,722,000 December 31, 2014 5,233,000 Sanhe leases its principal office, factory and dormitory from LuckSky Group in Sanhe City, Hebei Province. LuckSky Group is owned by Zhou Deng Rong, our former CEO and Zhou Jian, our General Manager and Chairman of the Board. The space in the office, factory and dormitory being leased are 1296, 5160 and 1200 square meters, respectively. The office and factory space are leased for a rent of $ 113,492 697,248 21,095 129,600 April 30, 2024 133,324 33,253 On April 28, 2012, Zhou Jian obtained the right of usage of 44.3 18 years and 8 months 5,617 34,510 Sanhe also leases a second factory and office in Sanhe City from Sanhe Dong Yi Glass Machine Company Limited, which is owned by Zhou Deng Rong. A portion of this facility is currently used by Sanhe to demonstrate its products but the facility is primarily intended as a backup to the first facility in Sanhe City and/or for expansion. The factory and office are 4,748.96 1,306,500 30 years 172,611 52,542 From time to time, Mr. Zhou Deng Rong prepaid some expenses for the company. April 30, 2015 July 31, 2014 Rental fees: LuckSky Group 133,324 33,253 Sanhe Dong Yi (Capital lease interest payable) $ 172,611 $ 52,542 Purchase Fixed assets: Kelitai $ - $ 1,235,667 Borrowings: LuckSky Group - 1,242,198 Sanhe Dong Yi $ - $ 160,865 Prepaid expenses on behalf of the company: Kelitai - 1,510 Zhou Deng Rong 556,992 354,112 Total $ 862,927 $ 3,080,147 Due to Shareholders Since inception to April 2014, the Company’s shareholders have paid several employees’ salaries on behalf of the Company. As of April 30, 2015 and July 31, 2014, the amount due to shareholders was $ 18,978 18,934 Due to Directors From time to time, the Company receives advances from its directors. As of April 30, 2015 and July 31, 2014, the Company received $ 417,776 430,928 | NOTE 8- RELATED PARTY TRANSACTIONS Since inception, Sanhe rented an office from Sanhe Dong Yi Glass Machine Company Limited (“Sanhe Dong Yi”), a Company owned by Zhou Deng Rong, our former general manager and former majority shareholder of the Company. The rental period was from June 15, 2013 to June 14, 2014, and the full rent amount of $ 3,965 12,000 1,487 9,000 Prior to the incorporation of Sanhe, Kelitai Air Powered Machinery Co., Ltd. (“Kelitai”), a subsidiary of LuckSky Group, an entity owned by Zhou Deng Rong, former general manager and former majority shareholder of the Company, executed various purchase agreements (the “Agreements”) with Beijing Hengruier Machinery Company Limited (“Hengruier”) and made certain prepayments on behalf of the Company. On July 15, 2013, Kelitai, Hengruier and the Company executed a tripartite agreement to transfer the rights and obligations of the Agreements to the Company. As of July 31, 2014, Kelitai has paid $1,242,198 on behalf of the Company as prepayments to Hengruier. The outstanding amounts due to related parties were $ 1,242,198 7,722,000 On September 15, 2013, the Company entered into an agreement to acquire HK Shares, a Hong Kong corporation, for 250,000,000 shares of common stock of the Company. Prior to the acquisition, HK Shares was majority owned (approximately 41%) by Mr. Zhou Deng Hua who is the brother of the former CEO of the Company and a director of the Company. On September 23, 2013, the Company issued 250,000,000 shares of common stock to the shareholders of HK Shares in exchange for 250,000,000 shares of HK Shares subscribed at $0.001 per share for a total amount of $250,000.At the completion of the acquisition, HK Shares was merged into the Company. HK Shares was formed in September 24, 2013 and issued 250,000,000 0.001 250,000 On May 30, 2014, the Company entered into the Stock Purchase Agreement with Zhou Jian, the sole shareholder of Luck Sky HK, a Hong Kong corporation, pursuant to which it purchased 100 10,000.00 1,289.98 In May 2014, Sanhe entered into an agreement with Kelitai, to purchase some of Keizai’s fixed assets for the use in its own production. The total amount for the fixed assets and inventory was $ 1,261,872 7,844,300 47,265 162,900 21,000 130,919 1,235,667 7,681,400 On July 25, 2014, Luck Sky Shen Zhen obtained an exclusive, worldwide, royalty free license from Zhou Deng Rong and Zhou Jian (his son) and a second exclusive, worldwide royalty free license from LuckSky Group to an aggregate of 48 Chinese patents and related know how and trade secrets, including the technology underlying 13 patent applications (the “Technology”). The Technology represents all of the patents, patent applications and related know how and trade secrets owned by the licensors with respect to PV installations and the air energy storage power generation technology as applied to commercial and residential buildings, but not wind towers. On July 25, 2014, Luck Sky Shen Zhen granted Sanhe an exclusive sublicense with respect to the use of the Technology for commercial and residential buildings, but not for other uses, including wind towers, vehicles and trains, which sublicense also provides for a royalty payment to Luck Sky Shen Zhen equal of five percent of Sanhe’s revenues. Sanhe leases its principal office, factory and dormitory from LuckSky Group in Sanhe City, Hebei Province. LuckSky Group is owned by Zhou Deng Rong, our former CEO and Zhou Jian, our General Manager and Chairman of the Board. The space in the office, factory and dormitory being leased are 1296 5160 1200 113,492 697,248 21,095 129,600 April 30, 2024 On April 28, 2012, Zhou Jian obtained the right of usage of 44.3 Sanhe also leases a second factory and office in Sanhe City from Sanhe Dong Yi Glass Machine Company Limited, which is owned by Zhou Deng Rong. A portion of this facility is currently used by Sanhe to demonstrate its products but the facility is primarily intended as a backup to the first facility in Sanhe City and/or for expansion. The factory and office are 4,748.96 1,306,500 30 years On July 25, 2014, prior to the Acquisition, Sanhe and LuckSky Shen Zhen and Sanhe’s shareholders entered into a series of VIE Agreements, pursuant to which Sanhe became LuckSky Shen Zhen’s contractually controlled affiliate. The VIE Agreements include the Framework Agreement on Business Cooperation, the Exclusive Management, Consulting and Training and Technical Services Agreement, the Exclusive Option Agreement, the Equity Pledge Agreement, the Know-How Sub-License Agreement and the Power-of-Attorney. The purpose and effect of the VIE Agreements is to provide LuckSky Shen Zhen (the Company’s indirect wholly-owned subsidiary) with all of the management and control of Sanhe and all of its net income. While LuckSky Shen Zhen does not actually own at present any of the equity and shares in Sanhe, the purpose and effect of the VIE Agreements is to instill in LuckSky Shen Zhen total management and voting control of Sanhe for all material purposes. The use of VIE agreements is a common structure used to acquire PRC corporations, particularly in certain industries in which foreign investment is restricted or forbidden by the PRC government. On July 25, 2014, the Company entered into the Stock Purchase Agreement with Zhou Jian and Zhou Deng Rong, the owners of 97 3 264,850,740 8,191,260 45.7 Since inception, the Company’s shareholders have paid several employees’ salaries on behalf of the Company. As of July 31, 2014, the amount due to shareholders was $18,934. The Company promised to pay this debt once we have sufficient cash flow. From time to time, the Company receives advances from its directors. During the years ended July 31, 2014 and 2013, the Company received $ 430,928 8,999 3,080,147 97,110 |
GOVERNMENT CONTRIBUTION PLAN
GOVERNMENT CONTRIBUTION PLAN | 9 Months Ended | 12 Months Ended |
Apr. 30, 2015 | Jul. 31, 2014 | |
GOVERNMENT CONTRIBUTION PLAN | ||
GOVERNMENT CONTRIBUTION PLAN | NOTE 10 - GOVERNMENT CONTRIBUTION PLAN The Company participates in a government-mandated multi-employer defined contribution plan pursuant to which certain retirement, medical and other welfare benefits are provided to employees. Chinese labor regulations require the Company to pay to the local labor bureau a monthly contribution at a stated contribution rate based on the monthly basic compensation of qualified employees. The relevant local labor bureau is responsible for meeting all retirement benefit obligations; the Company has no further commitments beyond its monthly contribution. The outstanding amount was $ 54,403 22,098 | NOTE 9 -GOVERNMENT CONTRIBUTION PLAN The Company participates in a government-mandated multi-employer defined contribution plan pursuant to which certain retirement, medical and other welfare benefits are provided to employees. Chinese labor regulations require the Company to pay to the local labor bureau a monthly contribution at a stated contribution rate based on the monthly basic compensation of qualified employees. The relevant local labor bureau is responsible for meeting all retirement benefit obligations; the Company has no further commitments beyond its monthly contribution. The outstanding amount was $ 22,098 0 |
STATUTORY RESERVE
STATUTORY RESERVE | 9 Months Ended | 12 Months Ended |
Apr. 30, 2015 | Jul. 31, 2014 | |
STATUTORY RESERVE | ||
STATUTORY RESERVE | NOTE 11 - STATUTORY RESERVE Pursuant to the laws applicable to the PRC, PRC entities must make appropriations from after-tax profit to the non-distributable “statutory surplus reserve fund”. Subject to certain cumulative limits, the “statutory surplus reserve fund” requires annual appropriations of 10 50 10 50 | NOTE 10 - STATUTORY RESERVE Pursuant to the laws applicable to the PRC, PRC entities must make appropriations from after-tax profit to the non-distributable “statutory surplus reserve fund”. Subject to certain cumulative limits, the “statutory surplus reserve fund” requires annual appropriations of 10 50 10 50 |
CAPITAL STOCK AND EQUITY TRANSA
CAPITAL STOCK AND EQUITY TRANSACTIONS | 9 Months Ended | 12 Months Ended |
Apr. 30, 2015 | Jul. 31, 2014 | |
CAPITAL STOCK AND EQUITY TRANSACTIONS | ||
CAPITAL STOCK AND EQUITY TRANSACTIONS | NOTE 12 - CAPITAL STOCK AND EQUITY TRANSACTIONS Common Stock The total number of common shares authorized that may be issued by the Company is 1,000,000,000 0.001 During the period ended July 31, 2009, the Company issued 5,000,000 25,000 3,000,000 30,000 On September 23, 2013, the Company issued 250,000,000 250,000,000 On September 23, 2013, the Company issued a total of 67,000,000 0.001 60,000,000 7,000,000 67,000,000 67,000 0.001 On July 25, 2014, we entered into the Stock Purchase Agreement in connection with the acquisition of Sanhe with Zhou Jian and Zhou Deng Rong, the owners of 97 3 264,850,740 8,191,260 45.7 Preferred Stock The total number of preferred shares authorized that may be issued by the Company is 100,000,000 0.001 | NOTE 11 - CAPITAL STOCK AND EQUITY TRANSACTIONS Common Stock The total number of common shares authorized that may be issued by the Company is 1,000,000,000 shares with a par value of $0.001 per share. During the period ended July 31, 2009, the Company issued 5,000,000 shares of common stock for total cash proceeds of $25,000 to the Company’s sole director and officer. During the year ended July 31, 2010, the Company sold 3,000,000 shares of common stock for total cash proceeds of $30,000. On September 23, 2013, the Company issued 250,000,000 shares of common stock to the shareholders of HK shares, in exchange of 250,000,000 shares of HK shares. On September 23, 2013, the Company issued a total of 67,000,000 shares of restricted common stock at $0.001 per share, such that 60,000,000 shares were issued to Mr. Roy Thomas Phillips, who was then a consultant to the Company and later served as the acting CFO of the Company beginning July 29, 2014, and 7,000,000 shares were issued to two other non-related parties. The shares were issued in contemplation of a secondary offering. The Company takes the position that these shares should be cancelled since no secondary offering was consummated. The Company is taking steps to have these shares canceled. The Company valued the 67,000,000 shares of common stock issued at $67,000 as there was no market for the Company’s common stock and it has limited or no trading; and there is thought to be minimal value in the Company at the time of issuance, therefore the par value is thought to match the assumed market price of the Company’s common stock which is at $0.001 per share. On July 25, 2014, we entered into the Stock Purchase Agreement in connection with the acquisition of Sanhe with Zhou Jian and Zhou Deng Rong, the owners of 97% and 3%, respectively, of Sanhe. We agreed to issue to Zhou Jian and Zhou Deng Rong 264,850,740 and 8,191,260 shares, respectively, of our common stock, representing 45.7% of the our issued and outstanding shares of common stock. Preferred Stock The total number of preferred shares authorized that may be issued by the Company is 100,000,000 shares with a par value of $0.001 per share. The preferred stock may be issued in one or more series, from time to time, with each series to have such designation, relative rights, preference or limitations, as adopted by the Company’s Board of Directors. No preferred shares have been issued. |
INCOME TAXES
INCOME TAXES | 9 Months Ended | 12 Months Ended |
Apr. 30, 2015 | Jul. 31, 2014 | |
INCOME TAXES | ||
INCOME TAXES | NOTE 13 - INCOME TAXES United States Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. 34 April 30, 2015 July 31, 2014 Deferred tax assets: Net operating losses $ 224,460 $ 170,552 Total deferred tax assets 224,460 170,552 Less: valuation allowance (224,460) (170,552) Deferred tax assets, net $ - $ - As of April 30, 2015, for U.S. federal income tax reporting purposes, the Company has approximately $ 660,179 Hong Kong The Company’s subsidiaries established in HKSAR are subject to Hong Kong Profits Tax. However, these subsidiaries did not earn any income derived in Hong Kong from its date of incorporation to April 30, 2015, and therefore were not subject to Hong Kong Profits Tax. PRC The Company’s subsidiaries established in PRC are subject to income tax rate of 25 1) Luck Sky Shenzhen As of April 30, 2015, Luck Sky Shenzhen had $ 30,036 7,529 2) Sanhe As of April 30, 2015, Sanhe had $ 901,742 298,171 111,844 | NOTE 12 - INCOME TAXES United States Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. 2014 2013 Deferred tax assets: Net operating losses $ 170,552 $ 59,350 Total deferred tax assets 170,552 59,350 Less: valuation allowance (170,552) (59,350) Deferred tax assets, net $ - $ - As of July 31, 2014, for U.S. federal income tax reporting purposes, the Company has approximately $ 501,624 Hong Kong The Company’s subsidiaries established in HKSAR are subject to Hong Kong Profits Tax. However, these subsidiaries did not earn any income derived in Hong Kong from its date of incorporation to July 31, 2014, and therefore were not subject to Hong Kong Profits Tax. PRC The Company’s subsidiaries established in PRC are subject to income tax rate of 25%. 1) Luck Sky Shenzhen As of July 31, 2014, Luck Sky Shenzhen had $ 6,283 100 2) Sanhe As of July 31, 2014, Sanhe had $ 341,795 113,392 |
COMMITMENTS, CONTINGENCIES, RIS
COMMITMENTS, CONTINGENCIES, RISKS AND UNCERTAINTIES | 9 Months Ended | 12 Months Ended |
Apr. 30, 2015 | Jul. 31, 2014 | |
COMMITMENTS, CONTINGENCIES, RISKS AND UNCERTAINTIES | ||
COMMITMENTS, CONTINGENCIES, RISKS AND UNCERTAINTIES | NOTE 14. COMMITMENTS, CONTINGENCIES, RISKS AND UNCERTAINTIES Capital Commitments The Company purchased property, plant and equipment which the payment was due within one year. As of April 30, 2015 and July 31, 2014, the Company has a capital commitment of $ 19,508,643 27,777,872 Operation Commitments Remaining 2015 85,997 Year ending July 31, 2016 343,989 Year ending July 31, 2017 343,989 Year ending July 31, 2018 343,989 After 2018 6,191,227 Total $ 7,309,191 Rental expense of the Company for the nine months ended April 30, 2015 and 2014 were $ 258,801 2,943 Credit risk Cash deposits with banks are held in financial institutions in China, which are not federally insured deposit protection. Accordingly, the Company has a concentration of credit risk related to these uninsured bank deposits. The Company has not experienced any losses in such accounts and believes it is not exposed to significant credit risk in this area. Contingency On September 23, 2013, Mr. Roy Thomas Phillips, who was then a consultant to the Company and served as the acting CFO of the Company from July 29, 2014 until his resignation on March 29, 2015, obtained 60,000,000 7,000,000 67,000,000 67,000,000 62,000,000 5,000,000 67,000,000 0.00 | NOTE 13. COMMITMENTS, CONTINGENCIES, RISKS AND UNCERTAINTIES Capital Commitments The Company purchased property, plant and equipment which the payment was due within one year. As of July 31, 2014, the Company has a capital commitment of $27,777,872. Operation Commitments Year ending July 31, 2015 345,554 Year ending July 31, 2016 345,554 Year ending July 31, 2017 345,554 Year ending July 31, 2018 345,554 After 2018 6,075,426 Total $ 7,457,642 Rental expense of the Company for the year ended July 31, 2014 and 2013 were $ 89,760 0 Credit risk Cash deposits with banks are held in financial institutions in China, which are not federally insured deposit protection. Accordingly, the Company has a concentration of credit risk related to these uninsured bank deposits. The Company has not experienced any losses in such accounts and believes it is not exposed to significant credit risk in this area. Contingencies On July 20, 2014, Mr. Zhou Deng Rong, former general manager and former majority shareholder of the Company, received a verbal summon from the Public Security Bureau in Chi Feng city for investigation assistance purposes and Mr. Zhou is being questioned by the authorities. The investigation is related to the initial offering to the Chinese investors by Xiangtian (Beijing) Equity Investment Fund Management Co., Ltd. Mr. Zhou resigned as General Manager and Director of the Company effective July 29, 2014. The Company has received no notice of any investigation or proceeding with respect to this offering or any other matter and is not aware of any warrant or charges against Mr. Zhou or any notices of any warrant delivered to his family. In addition, no claims have been filed against the Company or any of its affiliates by any shareholder. However, the filing of such a claim or commencement of any governmental investigation or proceeding, even if not justified, could create negative publicity and have a material adverse impact on the Company’s ability to raise additional capital and on the market price of the Company’s common stock. Should any of the allegations or claims be proven, the Company could be adversely affected. Certain Chinese investors purchased the right to receive shares of common stock in a Hong Kong entity with were to be exchanged for stock in a United States entity that would /that would own rights to the compressed air storage technology. Shares in LuckSky (Hong Kong) Shares Limited, and then a total of 150,000,000 However, the filing of such a claim or commencement of any governmental investigation or proceeding against the Company, even if not justified, could create negative publicity and have a material adverse impact on the Company’s ability to raise additional capital and on the market price of the Company’s common stock. Should any of the allegations or claims be proven, the Company could be adversely affected. On September 23, 2013, the Company issued 60,000,000 0.001 7,000,000 67,000,000 67,000 0.001 67,000,000 |
BASIS OF PRESENTATION AND SUM21
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended | 12 Months Ended |
Apr. 30, 2015 | Jul. 31, 2014 | |
Accounting Policies [Abstract] | ||
Basis of Presentation | Basis of Presentation The consolidated financial statements include the financial statements of the Company, its subsidiaries, including the wholly-foreign owned enterprise ("WOFE"), and VIEs for which the Company is deemed the primary beneficiary. The consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America. This basis of accounting involves the application of accrual accounting and consequently, revenues and gains are recognized when earned, and expenses and losses are recognized when incurred. The Company’s consolidated financial statements are expressed in U.S. dollars. | Basis of Presentation The consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America. This basis of accounting involves the application of accrual accounting and consequently, revenues and gains are recognized when earned, and expenses and losses are recognized when incurred. The Company’s consolidated financial statements are expressed in U.S. dollars. |
Use of Estimates and Assumptions | Use of Estimates and Assumptions The preparation of consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates. | Use of Estimates and Assumptions The preparation of consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates. |
Interim Financial Statements | Interim Financial Statements The accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles (GAAP) applicable to interim financial information and the requirements of Form 10-Q and Rule 8-03 of Regulation S-X of the Securities and Exchange Commission. Accordingly, they do not include all of the information and disclosure required by accounting principles generally accepted in the United States of America for complete financial statements. Interim results are not necessarily indicative of results for a full year. In the opinion of management, all adjustments considered necessary for a fair presentation of the financial position and the results of operations and cash flows for the interim periods have been included. These interim financial statements should be read in conjunction with the audited financial statements for the year ended July 31, 2014, as not all disclosures required by generally accepted accounting principles for annual financial statements are presented. The interim financial statements follow the same accounting policies and methods of computations as the audited financial statements for the year ended July 31, 2014. These interim financial statements should be read in conjunction with the audited financial statements for the year ended July 31, 2014, as not all disclosures required by generally accepted accounting principles for annual financial statements are presented. The interim financial statements follow the same accounting policies and methods of computations as the audited financial statements for the year ended July 31, 2014. | |
Reclassification | Reclassification Certain amounts in the prior period financial statements have been reclassified to conform to the current period presentation. These reclassifications had no effect on reported net income or losses. | |
Principle of Consolidation | The consolidated financial statements include the accounts of the Company, its subsidiaries and VIE for which it is deemed the primary beneficiary. All significant inter-company accounts and transactions have been eliminated in consolidation. The Company evaluates the need to consolidate its VIE in which equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support. The VIE agreement was not consummated until July 25, 2014, however, the purpose and design of the establishment of VIE, Sanhe, was to be consolidated under the Company through common control. ASC 810-10-25-38F states that a reporting entity’s involvement in the design of a VIE may indicate that the reporting entity had the opportunity and the incentive to establish arrangements that result in the reporting entity being the variable interest holder with the power to direct the activities that most significantly impact the VIE’s economic performance. As both the Company and the acquired VIE, Sanhe, are under the common control of Zhou Dengrong and Zhou Jian immediately before and after the acquisition, this transaction was accounted for as a merger under common control, using merger accounting as if the merger had been consummated at the beginning of the earliest period presented, and no gain or loss was recognized. All the assets and liabilities of the VIE, Sanhe, are recorded at carrying value. Hence, Sanhe was consolidated under the Company since its inception due to the purpose and design of its establishment. Details of the typical VIE structure of the Company's significant VIEs, primarily domestic companies associated with the operations of Sanhe, are set forth below: ⋅ Framework Agreement on Business Cooperation, entered between Luck Sky Shen Zhen and Sanhe, pursuant to which Luck Sky Shen Zhen and Sanhe have agreed to enter into a series of VIE agreements and to cooperate in all prospective of Sanhe’s business operation and management ⋅ Exclusive Management, Consulting and Training and Technical Service Agreement, entered between Luck Sky Shen Zhen and Sanhe, pursuant to which Luck Sky Shen Zhen has agreed to provide Sanhe with complete business support and technical support and related management, training and consulting services. In consideration for such services, Luck Sky Shen Zhen is entitled to receive an amount equal to 100 ⋅ Exclusive Option Agreement, entered among Luck Sky HK, Luck Sky Shen Zhen, Zhou Deng Rong, Zhou Jian and Sanhe, pursuant to which Zhou Deng Rong and Zhou Jian, the owners of Sanhe, have granted to Luck Sky Shen Zhen and Luck Sky HK the irrevocable right and option to acquire all of their equity interests in Sanhe. ⋅ Equity Pledge Agreement, entered among Luck Sky Shen Zhen, Zhou Deng Rong, Zhou Jian, and Sanhe, pursuant to which Zhou Deng Rong and Zhou Jian, the owners of Sanhe, have pledged all of their rights, titles and interests in Sanhe to Luck Sky Shen Zhen to guarantee Sanhe’s performance of its obligations under all the other VIE Agreements ⋅ Know-How Sub-License Agreement, entered between Luck Sky Shen Zhen and Sanhe, pursuant to which Luck Sky Shen Zhen has granted Sanhe an exclusive right to use and develop a series of aerodynamics related patents and technologies with respect to electrical generation for commercial and residential structures, not including automobile and wind towers. Luck Sky Shen Zhen possesses the rights licensed under this agreement through two license agreements dated July 25, 2014 with Zhou Deng Rong, Zhou Jian and Lucksky Group, the owners of the aforesaid patents and technologies. For the sublicense contemplated under this Agreement, Sanhe will pay Luck Sky Shen Zhen an annual royalty fee of five percent of revenue; and ⋅ Power of Attorney. Pursuant to a power of attorney, each of the Sanhe stockholders agreed to irrevocably entrust Luck Sky Shen Zhen with his stockholder voting rights and other stockholder rights for representing him to exercise such rights at the stockholders’ meeting of Sanhe in accordance with applicable laws and its Article of Association, including, but not limited to, the right to sell or transfer all or any of his equity interest in Sanhe, and appoint and vote for the directors and Chairman of Sanhe as the authorized representative of the Sanhe stockholders. The term of each proxy and voting agreement is as long as each of the Sanhe stockholders is a shareholder of Sanhe and is binding on any transferee. Under the contractual arrangements with the VIEs, the Company has the power to direct activities of the VIEs and can have assets transferred out of the VIE under its control. Therefore, the Company considers that there is no asset in any of the consolidated VIE that can be used only to settle obligations of the VIE, except for registered capital and PRC statutory reserves. As all consolidated VIEs are incorporated as limited liability companies under the PRC Company Law, creditors of the VIE do not have recourse to the general credit of the Company for any of the liabilities of the consolidated VIE. The Company’s total assets and liabilities presented in the consolidated financial statements represent substantially all of total assets and liabilities of the VIE because the other entities in the consolidation are non-operating holding entities with nominal assets and liabilities. The following financial statement amounts and balances of the VIE, which is established on August 6, 2014, were included in the accompanying consolidated financial statements as of April 30, 2015 and July 31, 2014 and for the nine months ended April 30, 2015 and 2014, respectively: April 30, 2015 July 31, 2014 Total assets $ 21,401,700 $ 17,666,510 Total liabilities 12,621,604 8,821,079 For the nine For the nine Ended ended April 30, 2015 April 30, 2014 Net loss $ 559,947 $ 327,085 | Principle of Consolidation The consolidated financial statements include the financial statements of the Company, its subsidiaries, including the wholly-foreign owned enterprise ("WOFE"), and VIEs for which the Company is deemed the primary beneficiary. The Company evaluates the need to consolidate its VIE in which equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support. The VIE agreement was not consummated until July 25, 2014, however, the purpose and design of the establishment of VIE, Sanhe, was to be consolidated under the Company through common control. ASC 810-10-25-38F states that a reporting entity’s involvement in the design of a VIE may indicate that the reporting entity had the opportunity and the incentive to establish arrangements that result in the reporting entity being the variable interest holder with the power to direct the activities that most significantly impact the VIE’s economic performance. As both the Company and the acquired VIE, Sanhe, are under the common control of Zhou Deng Rong and Zhou Jian immediately before and after the acquisition, this transaction was accounted for as a merger under common control, using merger accounting as if the merger had been consummated at the beginning of the earliest period presented, and no gain or loss was recognized. All the assets and liabilities of the VIE, Sanhe, are recorded at carrying value. Hence, Sanhe was consolidated under the Company since its inception due to the purpose and design of its establishment. Details of the typical VIE structure of the Company's significant VIEs, primarily domestic companies associated with the operations of Sanhe, are set forth below: ⋅ Framework Agreement on Business Cooperation, entered between Luck Sky Shen Zhen and Sanhe, pursuant to which Luck Sky Shen Zhen and Sanhe have agreed to enter into a series of VIE agreements and to cooperate in all prospective of Sanhe’s business operation and management ⋅ Exclusive Management, Consulting and Training and Technical Service Agreement, entered between Luck Sky Shen Zhen and Sanhe, pursuant to which Luck Sky Shen Zhen has agreed to provide Sanhe with complete business support and technical support and related management, training and consulting services. In consideration for such services, Luck Sky Shen Zhen is entitled to receive an amount equal to 100 ⋅ Exclusive Option Agreement, entered among Luck Sky HK, Luck Sky Shen Zhen, Zhou Deng Rong, Zhou Jian and Sanhe, pursuant to which Zhou Deng Rong and Zhou Jian, the owners of Sanhe, have granted to Luck Sky Shen Zhen and Luck Sky HK the irrevocable right and option to acquire all of their equity interests in Sanhe. ⋅ Equity Pledge Agreement, entered among Luck Sky Shen Zhen, Zhou Deng Rong, Zhou Jian, and Sanhe, pursuant to which Zhou Deng Rong and Zhou Jian, the owners of Sanhe, have pledged all of their rights, titles and interests in Sanhe to Luck Sky Shen Zhen to guarantee Sanhe’s performance of its obligations under all the other VIE Agreements ⋅ Know-How Sub-License Agreement, entered between Luck Sky Shen Zhen and Sanhe, pursuant to which Luck Sky Shen Zhen has granted Sanhe an exclusive right to use and develop a series of aerodynamics related patents and technologies with respect to electrical generation for commercial and residential structures, not including automobile and wind towers. Luck Sky Shen Zhen possesses the rights licensed under this agreement through two license agreements dated July 25, 2014 with Zhou Deng Rong, Zhou Jian and Lucksky Group, the owners of the aforesaid patents and technologies. For the sublicense contemplated under this Agreement, Sanhe will pay Luck Sky Shen Zhen an annual royalty fee of five percent of revenue; and ⋅ Power of Attorney. Pursuant to a power of attorney, each of the Sanhe stockholders agreed to irrevocably entrust Luck Sky Shen Zhen with his stockholder voting rights and other stockholder rights for representing him to exercise such rights at the stockholders’ meeting of Sanhe in accordance with applicable laws and its Article of Association, including, but not limited to, the right to sell or transfer all or any of his equity interest in Sanhe, and appoint and vote for the directors and Chairman of Sanhe as the authorized representative of the Sanhe stockholders. The term of each proxy and voting agreement is as long as each of the Sanhe stockholders is a shareholder of Sanhe and is binding on any transferee. Under the contractual arrangements with the VIEs, the Company has the power to direct activities of the VIEs and can have assets transferred out of the VIE under its control. Therefore, the Company considers that there is no asset in any of the consolidated VIE that can be used only to settle obligations of the VIE, except for registered capital and PRC statutory reserves. As all consolidated VIEs are incorporated as limited liability companies under the PRC Company Law, creditors of the VIE do not have recourse to the general credit of the Company for any of the liabilities of the consolidated VIE. The Company’s total assets and liabilities presented in the consolidated financial statements represent substantially all of total assets and liabilities of the VIE because the other entities in the consolidation are non-operating holding entities with nominal assets and liabilities. July 31, 2014 Total assets $ 26,927,076 Total liabilities 17,610,720 For the year ended July 31,2014 Net loss $ 455,727 |
Fair Value Measurements | The Company applies the provisions of ASC Subtopic 820-10, “Fair Value Measurements”, for fair value measurements of financial assets and financial liabilities and for fair value measurements of nonfinancial items that are recognized or disclosed at fair value in the financial statements. ASC 820 also establishes a framework for measuring fair value and expands disclosures about fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Company considers the principal or most advantageous market in which it would transact and it considers assumptions that market participants would use when pricing the asset or liability. ASC 820 establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes three levels of inputs that may be used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to measurements involving significant unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows: ⋅ Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. ⋅ Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the assets or liability, either directly or indirectly, for substantially the full term of the financial instruments. ⋅ Level 3 inputs to the valuation methodology are unobservable and significant to the fair value. There were no assets or liabilities measured at fair value on a recurring basis subject to the disclosure requirements of ASC 820 as of April 30, 2015 and July 31, 2014 . | Fair Value Measurements The Company applies the provisions of ASC Subtopic 820-10, “Fair Value Measurements”, for fair value measurements of financial assets and financial liabilities and for fair value measurements of nonfinancial items that are recognized or disclosed at fair value in the financial statements. ASC 820 also establishes a framework for measuring fair value and expands disclosures about fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Company considers the principal or most advantageous market in which it would transact and it considers assumptions that market participants would use when pricing the asset or liability. ASC 820 establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes three levels of inputs that may be used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to measurements involving significant unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows: ¨ Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. ¨ Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the assets or liability, either directly or indirectly, for substantially the full term of the financial instruments. ¨ Level 3 inputs to the valuation methodology are unobservable and significant to the fair value. There were no assets or liabilities measured at fair value on a recurring basis subject to the disclosure requirements of ASC 820 as of July 31, 2014 and 2013. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. | Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. |
Inventory | Inventory Inventory is stated at the lower of cost or market. Cost is principally determined using the weighted average basis. Construction costs incurred on contracts are included in inventories which consist of raw materials, accessory parts, and contracts work in progress. | Inventory Inventory is stated at the lower of cost or market. Cost is principally determined using the weighted average basis. Construction costs incurred on contracts are included in inventories which consist of raw materials, accessory parts, and contracts work in progress. |
Costs in Excess of Billings | Costs in Excess of Billings: Costs in excess of billings represent unbilled amounts earned and reimbursable under contracts. These amounts become billable according to the contract terms, which usually consider the passage of time, achievement of milestones or completion of the project. Generally, such unbilled amounts will be billed and collected over the next twelve months. There was no cost in excess of billings for the periods ended April 30, 2015 and July 31, 2014. | |
Billings in Excess of Costs | Billings in Excess of Costs: Billings in excess of costs is comprised of cash collected from customers and billings to customers on contracts in advance of work performed, including advance payments negotiated as a contract condition. Generally, unearned project-related costs will be earned over the next twelve months. | |
Property and equipment | Property and equipment Property and equipment are stated at cost less accumulated depreciation and impairment losses. Gains or losses on dispositions of property and equipment are included in operating income (loss). Major additions, renewals and betterments are capitalized, while maintenance and repairs are expensed as incurred. Depreciation and amortization are provided over the estimated useful lives of the assets using the straight-line method from the time the assets are placed in service. Classification Estimated useful life Machinery equipment 5 10 Computer and office equipment 3 Vehicle 5 Property under capital lease 20 | Property and equipment Property and equipment are stated at cost less accumulated depreciation and impairment losses. Gains or losses on dispositions of property and equipment are included in operating income (loss). Major additions, renewals and betterments are capitalized, while maintenance and repairs are expensed as incurred. Depreciation and amortization are provided over the estimated useful lives of the assets using the straight-line method from the time the assets are placed in service. Classification Estimated useful life Machinery equipment 5 10 Computer and office equipment 3 Vehicle 5 Property under capital lease 20 |
Revenue Recognition | Revenue Recognition Sales of power generation system in conjunction of system installation are recognized under accounting for construction-type contracts, using the completed contract method because reliable estimates are not available for the costs and efforts necessary to complete the construction. Accordingly, revenue is recognized upon the completion of the construction, provided persuasive evidence of an arrangement exists, title and risk of loss has transferred, the fee is fixed and determinable, and collection is reasonably assured. We provide for any loss that we expect to incur on these contracts when that loss is probable. | Revenue Recognition Sales of power generation system in conjunction of system installation are recognized under accounting for construction-type contracts, using the completed contract method. Accordingly, revenue is recognized upon the completion of the construction, provided persuasive evidence of an arrangement exists, title and risk of loss has transferred, the fee is fixed and determinable, and collection is reasonably assured. We provide for any loss that we expect to incur on these contracts when that loss is probable. |
Warranty and Returns | Warranty and Returns The Company generally provides limited warranties for work performed under its contracts. The warranty periods typically extend for a limited duration following substantial completion of the Company's work on a project. At the time a sale is recognized, we record estimated future warranty costs. Such estimated costs for warranties are included in the individual project cost estimates for purposes of accounting for long-term contracts. The warranty cost is estimated based on our experience with the type of work and any known risks relative to the project and was not material during the periods ended April 30, 2015 and 2014. No right of return exists on sales of equipment. Replacement part returns are estimable and accrued at the time a sale is recognized. | Warranty and Returns The Company generally provides limited warranties for work performed under its contracts. The warranty periods typically extend for a limited duration following substantial completion of the Company's work on a project. At the time a sale is recognized, we record estimated future warranty costs. Such estimated costs for warranties are included in the individual project cost estimates for purposes of accounting for long-term contracts. Generally, the estimated claim rates of warranty are based on actual warranty experience or Company’s best estimate. No right of return exists on sales of equipment. Replacement part returns are estimable and accrued at the time a sale is recognized. |
Value added taxes | Value added taxes The Company is subject to VAT at a rate of 17 | Value added taxes The Company is subject to VAT at a rate of 17 |
Income Taxes | Income Taxes The Company accounts for income taxes using an asset and liability approach which allows for the recognition and measurement of deferred tax assets based upon the likelihood of realization of tax benefits in future years. Under the asset and liability approach, deferred taxes are provided for the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. A valuation allowance is provided for deferred tax assets if it is more likely than not these items will either expire before the Company is able to realize their benefits, or that future deductibility is uncertain. Under ASC 740, a tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The evaluation of a tax position is a two-step process. The first step is to determine whether it is more-likely-than-not that a tax position will be sustained upon examination, including the resolution of any related appeals or litigations based on the technical merits of that position. The second step is to measure a tax position that meets the more-likely-than-not threshold to determine the amount of benefit to be recognized in the financial statements. A tax position is measured at the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate settlement. Tax positions that previously failed to meet the more-likely-than-not recognition threshold should be recognized in the first subsequent period in which the threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not criteria should be de-recognized in the first subsequent financial reporting period in which the threshold is no longer met. Penalties and interest incurred related to underpayment of income tax are classified as income tax expense in the year incurred. No significant penalties or interest relating to income taxes have been incurred during the period from July 8, 2013 (inception) to December 31, 2013. US GAAP also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosures and transition. | Income Taxes The Company accounts for income taxes using an asset and liability approach which allows for the recognition and measurement of deferred tax assets based upon the likelihood of realization of tax benefits in future years. Under the asset and liability approach, deferred taxes are provided for the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. A valuation allowance is provided for deferred tax assets if it is more likely than not these items will either expire before the Company is able to realize their benefits, or that future deductibility is uncertain. Under ASC 740, a tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The evaluation of a tax position is a two-step process. The first step is to determine whether it is more-likely-than-not that a tax position will be sustained upon examination, including the resolution of any related appeals or litigations based on the technical merits of that position. The second step is to measure a tax position that meets the more-likely-than-not threshold to determine the amount of benefit to be recognized in the financial statements. A tax position is measured at the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate settlement. Tax positions that previously failed to meet the more-likely-than-not recognition threshold should be recognized in the first subsequent period in which the threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not criteria should be de-recognized in the first subsequent financial reporting period in which the threshold is no longer met. Penalties and interest incurred related to underpayment of income tax are classified as income tax expense in the year incurred. No significant penalties or interest relating to income taxes have been incurred during the period from July 8, 2013 (inception) to December 31, 2013. US GAAP also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosures and transition. |
Comprehensive Loss | Comprehensive Loss The Company follows the provisions of the Financial Accounting Standards Board (the “FASB”) Accounting Standards Codification (“ASC”) 220 “Reporting Comprehensive Income”, and establishes standards for the reporting and display of comprehensive income, its components and accumulated balances in a full set of general purpose financial statements. | Comprehensive Loss The Company follows the provisions of the Financial Accounting Standards Board (the “FASB”) Accounting Standards Codification (“ASC”) 220 “Reporting Comprehensive Income”, and establishes standards for the reporting and display of comprehensive income, its components and accumulated balances in a full set of general purpose financial statements. |
Foreign Currency Translation | Foreign Currency Translation The Company’s functional currency is Chinese Renminbi (“RMB”) as substantially all of the Company’s PRC subsidiaries’ operations use this denomination. The consolidated financial statements are presented in U.S. dollars. Foreign denominated monetary assets and liabilities are translated into their United States dollar equivalents using foreign exchange rates which prevailed at the balance sheet date. Non-monetary assets and liabilities are translated at the exchange rates prevailing at the transaction date. Revenues and expenses are translated at average rates of exchange during the year. Gains or losses resulting from foreign currency transactions are included in results of operations. For the purpose of presenting these financial statements of subsidiaries in PRC, the Company’s assets and liabilities are expressed in US$ at the exchange rate on the balance sheet date, which is 6.2018 6.2164 6.1824 6.1168 For the purpose of presenting these financial statements of subsidiaries in Hong Kong, PRC, the Company’s assets and liabilities are expressed in US$ at the exchange rate on the balance sheet date, which is 7.7513 7.7497 7.7540 7.7556 | Foreign Currency Translation The Company’s functional currency is Chinese Renminbi (“RMB”) as substantially all of the Company’s PRC subsidiaries’ operations use this denomination. The consolidated financial statements are presented in U.S. dollars. Foreign denominated monetary assets and liabilities are translated into their United States dollar equivalents using foreign exchange rates which prevailed at the balance sheet date. Non-monetary assets and liabilities are translated at the exchange rates prevailing at the transaction date. Revenues and expenses are translated at average rates of exchange during the year. Gains or losses resulting from foreign currency transactions are included in results of operations. For the purpose of presenting these financial statements of subsidiaries in PRC, which were firstly consolidated in the fiscal year of 2014 , the Company’s assets and liabilities are expressed in US$ at the exchange rate on the balance sheet date, which is 6.2164 as of July 31, 2014; stockholder’s equity accounts are translated at historical rates, and income and expense items are translated at the weighted average exchange rate during the period, which is 6.1025 For the purpose of presenting these financial statements, the Company’s assets and liabilities are expressed in US$ at the exchange rate on the balance sheet date, which is 7.7497 and 7.7558 7.7545 7.7560 |
Earnings (loss) per Share | Earnings (loss) per Share Basic earnings per share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding during the period, excluding the effects of any potentially dilutive securities. Diluted earnings per share gives effect to all dilutive potential of shares of common stock outstanding during the period including stock options or warrants, using the treasury stock method (by using the average stock price for the period to determine the number of shares assumed to be purchased from the exercise of stock options or warrants), and convertible debt or convertible preferred stock, using the if-converted method. Earnings per share exclude all potential dilutive shares of common stock if their effect is anti-dilutive. There were no potential dilutive securities at April 30, 2015 or April 30 , 2014. | Earnings (Loss) per Share Basic earnings per share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding during the period, excluding the effects of any potentially dilutive securities. Diluted earnings per share gives effect to all dilutive potential of shares of common stock outstanding during the period including stock options or warrants, using the treasury stock method (by using the average stock price for the period to determine the number of shares assumed to be purchased from the exercise of stock options or warrants), and convertible debt or convertible preferred stock, using the if-converted method. Earnings per share excludes all potential dilutive shares of common stock if their effect is anti-dilutive. There were no potential dilutive securities at July 31, 2014 or 2013. |
Reclassification of Comparative Amounts | Reclassification of Comparative Amounts Certain comparative amounts for the prior period have been reclassified to conform to current period presentations. Such reclassifications had no effect on net income or shareholders’ equity. | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In February 2015, FASB issued ASU No. 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis. The new consolidation standard changes the way reporting enterprises evaluate whether (a) they should consolidate limited partnerships and similar entities, (b) fees paid to a decision maker or service provider are variable interests in a VIE, and (c) variable interests in a VIE held by related parties of the reporting enterprise require the reporting enterprise to consolidate the VIE. The guidance is effective for public business entities for annual and interim periods in fiscal years beginning after December 15, 2015. Early adoption is allowed, including early adoption in an interim period. A reporting entity may apply a modified retrospective approach by recording a cumulative-effect adjustment to equity as of the beginning of the fiscal year of adoption or may apply the amendments retrospectively. The Company is currently assessing the impact of the adoption of this guidance on the consolidated financial statements. In August 2014, the Financial Accounting Standards Board issued ASU No. 2014-15, Presentation of Financial Statements Going Concern (Subtopic 205-40). This standard is intended to define management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures. The amendments contained in this ASU apply to all companies and not-for-profit organizations. The amendments are effective for the annual period ending after December 15, 2016, and for annual and interim periods thereafter. Early application is permitted. The Company is currently assessing this ASU’s impact on the Company’s consolidated results of operations and financial condition. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers The Company believes that there were no other accounting standards recently issued that had or are expected to have a material impact on our financial position or results of operations. | Recent Accounting Pronouncements In August 2014, the Financial Accounting Standards Board issued ASU No. 2014-15, Presentation of Financial Statements Going Concern (Subtopic 205-40). This standard is intended to define management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures. The amendments contained in this ASU apply to all companies and not-for-profit organizations. The amendments are effective for the annual period ending after December 15, 2016, and for annual and interim periods thereafter. Early application is permitted. The Company is currently assessing this ASU’s impact on the Company’s consolidated results of operations and financial condition. In June 2014, the FASB issued ASU No. 2014-10, Development Stage Entities (Topic 915): Elimination of Certain Financial Reporting Requirements, Including an Amendment to Variable Interest Entities Guidance in Topic 810, Consolidation. The amendments in this Update remove the definition of a development stage entity from the Master Glossary of the Accounting Standards Codification, thereby removing the financial reporting distinction between development stage entities and other reporting entities from U.S. GAAP. For public business entities, those amendments are effective for annual reporting periods beginning after December 15, 2014, and interim periods therein. Early application of each of the amendments is permitted for any annual reporting period or interim period for which the entity’s financial statements have not yet been issued (public business entities) or made available for issuance (other entities). Upon adoption, entities will no longer present or disclose any information required by Topic 915.The Company adopted this ASU as early application for the financial statements of the period from July8, 2013 (inception) to December 31, 2013. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers In February 2013, the FASB issued ASU No. 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income. Under this standard, an entity is required to provide information about the amounts reclassified out of accumulated other comprehensive income (“AOCI”) by component. In addition, an entity is required to present, either on the face of the financial statements or in the notes, significant amounts reclassified out of AOCI by the respective line items of net income, but only if the amount reclassified is required to be reclassified in its entirety in the same reporting period. For amounts that are not required to be reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures that provide additional details about those amounts. ASU 2013-02 does not change the current requirements for reporting net income or other comprehensive income in the financial statements. For the Company, this ASU is effective beginning January 1, 2013, and interim periods within those annual periods. The adoption of this standard is not expected to have an impact on the Company’s financial results or disclosures. In March 2013, the FASB issued ASU No. 2013-05, Parent’s Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity. This standard provides additional guidance with respect to the reclassification into income of the cumulative translation adjustment (CTA) recorded in accumulated other comprehensive income associated with a foreign entity of a parent company. The ASU differentiates between transactions occurring within investment in within within investment in The Company believes that there were no other accounting standards recently issued that had or are expected to have a material impact on our financial position or results of operations. |
BASIS OF PRESENTATION AND SUM22
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 9 Months Ended | 12 Months Ended |
Apr. 30, 2015 | Jul. 31, 2014 | |
Accounting Policies [Abstract] | ||
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | The following financial statement amounts and balances of the VIE, which is established on August 6, 2014, were included in the accompanying consolidated financial statements as of April 30, 2015 and July 31, 2014 and for the nine months ended April 30, 2015 and 2014, respectively: April 30, 2015 July 31, 2014 Total assets $ 21,401,700 $ 17,666,510 Total liabilities 12,621,604 8,821,079 For the nine For the nine months Ended ended April 30, 2015 April 30, 2014 Net loss $ 559,947 $ 327,085 | The following financial statement amounts and balances of the VIE, which is established on August 6, 2014, were included in the accompanying consolidated financial statements as of July 31, 2014 and for the year ended July 31, 2014: July 31, 2014 Total assets $ 26,927,076 Total liabilities 17,610,720 For the year ended July 31,2014 Net loss $ 455,727 |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | Estimated useful lives are as follows, taking into account the assets' estimated residual value: Classification Estimated useful life Machinery equipment 5 10 Computer and office equipment 3 Vehicle 5 Property under capital lease 20 | Estimated useful lives are as follows, taking into account the assets' estimated residual value: Classification Estimated useful life Machinery equipment 5 10 Computer and office equipment 3 Vehicle 5 Property under capital lease 20 |
RESTATEMENT OF CONSOLIDATED F23
RESTATEMENT OF CONSOLIDATED FINANCIAL STATEMENTS (Tables) | 9 Months Ended | 12 Months Ended |
Apr. 30, 2015 | Jul. 31, 2014 | |
Accounting Changes and Error Corrections [Abstract] | ||
Condensed Consolidated Financial Statements | The following tables present the effect of the correction discussed above and other adjustments on selected line items of our previously reported consolidated financial statements for the period ended April 30, 2015 and 2014. As of and For the Period Ended April 30, 2015 Previously Adjustments Restated Consolidated Balance Sheets STOCKHOLDERS’ EQUITY Common stock: $0.001 par value, 1,000,000,000 shares authorized, 598,042,000 shares issued and outstanding, respectively $ 531,042 $ 67,000 $ 598,042 Additional paid-in capital 9,206,175 250,000 9,456,175 Subscription receivable - (317,000) (317,000) Consolidated Statement of Operations and Comprehensive Loss For the three months ended April 30, 2015, Weighted average number of common shares outstanding - basic and diluted 591,042,000 67,000,000 598,042,000 For the nine months ended April 30, 2015, Weighted average number of common shares outstanding - basic and diluted 591,042,000 67,000,000 598,042,000 | The following tables present the effect of the correction discussed above and other adjustments on selected line items of our previously reported consolidated financial statements as of and for the years ended July 31, 2014. As of and For the Year Ended July 31, 2014 Previously Adjustments Restated Consolidated Balance Sheets STOCKHOLDERS’ EQUITY Common stock: $0.001 par value, 1,000,000,000 shares authorized, 598,042,000and 8,000,000 shares issued and outstanding, respectively $ 531,042 $ 67,000 $ 598,042 Additional paid-in capital 9,201,675 250,000 9,451,675 Subscription receivable - (317,000) (317,000) Consolidated Statement of Operations and Comprehensive Loss Weighted average number of common shares outstanding - basic and diluted 263,079,329 21,126,956 284,206,285 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 9 Months Ended | 12 Months Ended |
Apr. 30, 2015 | Jul. 31, 2014 | |
Inventory Disclosure [Abstract] | ||
INVENTORIES | Inventories consist of the following: April 30, July 31, 2015 2014 Raw materials $ 295,539 $ 115,839 Accessory parts 899,252 635,708 Contracts work in process 980,923 1,030,106 Total $ 2,175,714 $ 1,781,653 | Inventories consist of the following: July 31, July 31, 2014 2013 Raw materials $ 115,839 $ - Accessory parts 635,708 - Contracts work in progress 8,893,979 - Total $ 9,645,526 $ - |
PROPERTY, PLANT AND EQUIPMENT (
PROPERTY, PLANT AND EQUIPMENT (Tables) | 9 Months Ended | 12 Months Ended |
Apr. 30, 2015 | Jul. 31, 2014 | |
Property, Plant and Equipment [Abstract] | ||
PROPERTY, PLANT AND EQUIPMENT | Property, plant and equipment consist of the following: April 30, July 31, 2015 2014 Machinery equipment $ 5,281,800 $ 3,997,506 Computer and office equipment 56,630 59,316 Vehicle 74,205 38,558 Property under capital lease 2,763,062 2,756,573 Total property, plant and equipment 8,175,697 6,851,953 Less: accumulated depreciation (382,457) (72,697) Total $ 7,793,240 $ 6,779,256 | Property, plant and equipment consist of the following: July 31, July 31, 2014 2013 Machinery equipment $ 3,997,506 $ - Computer and office equipment 59,316 - Vehicle 38,558 Property under capital lease 2,756,573 - Total property, plant and equipment 6,851,953 - Less: accumulated depreciation (72,697) - Total $ 6,779,256 $ - |
BILLINGS IN EXCESS OF COSTS (Ta
BILLINGS IN EXCESS OF COSTS (Tables) | 9 Months Ended |
Apr. 30, 2015 | |
Contractors [Abstract] | |
BILLINGS IN EXCESS OF COSTS | Billings in excess of costs consist of the following: April 30, 2015 July 31, 2014 Costs incurred on uncompleted contracts $ 16,716,459 $ 7,863,873 Billings to date (23,380,309) (11,710,958) $ (6,663,850) $ (3,847,085) Included in the accompanying balance sheets as follows: Costs in excess of billings on uncompleted contracts $ - $ - Billings on uncompleted contracts in excess of costs (6,663,850) (3,847,085) $ (6,663,850) $ (3,847,085) |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 9 Months Ended |
Apr. 30, 2015 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | As of April 30, 2015 and July 31, 3014, amounts due to related parties were as follows: April 30, 2015 July 31, 2014 Rental fees: LuckSky Group 133,324 33,253 Sanhe Dong Yi (Capital lease interest payable) $ 172,611 $ 52,542 Purchase Fixed assets: Kelitai $ - $ 1,235,667 Borrowings: LuckSky Group - 1,242,198 Sanhe Dong Yi $ - $ 160,865 Prepaid expenses on behalf of the company: Kelitai - 1,510 Zhou Deng Rong 556,992 354,112 Total $ 862,927 $ 3,080,147 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 9 Months Ended | 12 Months Ended |
Apr. 30, 2015 | Jul. 31, 2014 | |
Income Tax Disclosure [Abstract] | ||
INCOME TAXES | The cumulative tax effect at the expected rate of 34 April 30, 2015 July 31, 2014 Deferred tax assets: Net operating losses $ 224,460 $ 170,552 Total deferred tax assets 224,460 170,552 Less: valuation allowance (224,460) (170,552) Deferred tax assets, net $ - $ - | The cumulative tax effect at the expected rate of 34% of significant items comprising the net deferred tax amount is at July 31, 2014 and 2013 as follows: 2014 2013 Deferred tax assets: Net operating losses $ 170,552 $ 59,350 Total deferred tax assets 170,552 59,350 Less: valuation allowance (170,552) (59,350) Deferred tax assets, net $ - $ - |
COMMITMENTS, CONTINGENCIES, R29
COMMITMENTS, CONTINGENCIES, RISKS AND UNCERTAINTIES (Tables) | 9 Months Ended | 12 Months Ended |
Apr. 30, 2015 | Jul. 31, 2014 | |
Commitments and Contingencies Disclosure [Abstract] | ||
COMMITMENTS, CONTINGENCIES, RISKS AND UNCERTAINTIES | The total future minimum lease payments under the non-cancellable operating lease with respect to the office and the dormitory as of April 30, 2015 are payable as follows: Remaining 2015 85,997 Year ending July 31, 2016 343,989 Year ending July 31, 2017 343,989 Year ending July 31, 2018 343,989 After 2018 6,191,227 Total $ 7,309,191 | The total future minimum lease payments under the non-cancellable operating lease with respect to the office and the dormitory as of July 31, 2014 are payable as follows: Year ending July 31, 2015 345,554 Year ending July 31, 2016 345,554 Year ending July 31, 2017 345,554 Year ending July 31, 2018 345,554 After 2018 6,075,426 Total $ 7,457,642 |
NATURE OF OPERATIONS (Details T
NATURE OF OPERATIONS (Details Textual) - Type of Fresh-Start Adjustment [Domain] - Equity Component [Domain] - USD ($) | May. 01, 2012 | May. 31, 2014 | Sep. 15, 2013 | Apr. 30, 2015 | Jul. 31, 2014 | Jul. 25, 2014 | May. 30, 2014 | Sep. 23, 2013 | Jul. 31, 2013 | May. 15, 2012 |
Significant Accounting Policies [Line Items] | ||||||||||
Shares issued | 598,042,000 | 598,042,000 | 8,000,000 | |||||||
Shares Purchased Value | $ 235,000 | |||||||||
Proceeds from Divestiture of Interest in Consolidated Subsidiaries | $ 10 | |||||||||
Common Stock, Par or Stated Value Per Share | $ 0.001 | $ 0.001 | $ 0.001 | |||||||
Equity Method Investment Ownership Percentage | 100.00% | |||||||||
Percentage of Common Stock Issued and Outstanding | 100.00% | 45.70% | 45.70% | |||||||
Lucksky Hong Kong Shares Limited [Member] | ||||||||||
Significant Accounting Policies [Line Items] | ||||||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | 250,000,000 | |||||||||
Stock Issued During Period, Shares, New Issues | 250,000,000 | 150,000,000 | ||||||||
Common Stock, Par or Stated Value Per Share | $ 0.001 | |||||||||
Luck Sky International Investment Holding Limited [Member] | ||||||||||
Significant Accounting Policies [Line Items] | ||||||||||
Ownership Percentage | 90.00% | |||||||||
Shares issued | 7,200,000 | |||||||||
Shares Purchased Value | $ 235,000 | |||||||||
Mr. Zhou Jian [Member] | ||||||||||
Significant Accounting Policies [Line Items] | ||||||||||
Equity Method Investment Ownership Percentage | 97.00% | |||||||||
Stock Issued During Period, Shares, Acquisitions | 264,850,740 | |||||||||
Mr. Zhou Jian [Member] | Sanhe City Lucksky Electrical Engineering Co [Member] | ||||||||||
Significant Accounting Policies [Line Items] | ||||||||||
Equity Method Investment Ownership Percentage | 97.00% | |||||||||
Stock Issued During Period, Shares, Acquisitions | 264,850,740 | |||||||||
Mr. Zhou Deng Rong [Member] | ||||||||||
Significant Accounting Policies [Line Items] | ||||||||||
Equity Method Investment Ownership Percentage | 3.00% | |||||||||
Stock Issued During Period, Shares, Acquisitions | 8,191,260 | |||||||||
Mr. Zhou Deng Rong [Member] | Sanhe City Lucksky Electrical Engineering Co [Member] | ||||||||||
Significant Accounting Policies [Line Items] | ||||||||||
Equity Method Investment Ownership Percentage | 3.00% | |||||||||
Stock Issued During Period, Shares, Acquisitions | 8,191,260 |
BASIS OF PRESENTATION AND SUM31
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) | Apr. 30, 2015 | Jul. 31, 2014 |
Condensed Income Statements, Captions [Line Items] | ||
Total assets | $ 21,401,700 | $ 17,666,510 |
Total liabilities | $ 12,621,604 | $ 8,821,079 |
BASIS OF PRESENTATION AND SUM32
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 1) - USD ($) | 9 Months Ended | 12 Months Ended | |
Apr. 30, 2015 | Apr. 30, 2014 | Jul. 31, 2014 | |
Variable Interest Entity [Line Items] | |||
Net loss | $ 559,947 | $ 327,085 | $ 455,727 |
BASIS OF PRESENTATION AND SUM33
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 2) | 9 Months Ended | 12 Months Ended |
Apr. 30, 2015 | Jul. 31, 2014 | |
Machinery equipment [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 5 years | 5 years |
Machinery equipment [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 10 years | 10 years |
Computer and office equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 3 years | 3 years |
Vehicle [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 5 years | 5 years |
Property under capital lease [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 20 years | 20 years |
BASIS OF PRESENTATION AND SUM34
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Textual) | Apr. 30, 2015 | Jul. 31, 2014 | Jul. 25, 2014 | Apr. 30, 2014 | Jul. 31, 2013 |
Change in Accounting Estimate [Line Items] | |||||
Percentage Of Vat Proceeds Received From Customers | 17.00% | 17.00% | |||
Foreign Currency Exchange Rate, Translation | 7.7513 | 7.7497 | 7.7558 | ||
Foreign Currency Weighted Average Exchange Rate, Translation | 7.7540 | 7.7545 | 7.7556 | 7.7560 | |
Percentage Of Service Fees Payable | 100.00% | 100.00% | |||
Subsidiaries in PRC [Member] | |||||
Change in Accounting Estimate [Line Items] | |||||
Foreign Currency Exchange Rate, Translation | 6.2018 | 6.2164 | |||
Foreign Currency Weighted Average Exchange Rate, Translation | 6.1824 | 6.1025 | 6.1168 |
GOING CONCERN (Details Textual)
GOING CONCERN (Details Textual) - USD ($) | Apr. 30, 2015 | Jul. 31, 2014 | Jul. 31, 2013 |
Schedule Of Collaborative Arrangements And Going Concern Transactions [Line Items] | |||
Accumulated deficit | $ 1,553,110 | $ 862,211 | $ 181,017 |
RESTATEMENT OF CONSOLIDATED F36
RESTATEMENT OF CONSOLIDATED FINANCIAL STATEMENTS (Details) - USD ($) | Apr. 30, 2015 | Jul. 31, 2014 | Jul. 31, 2013 |
STOCKHOLDERS' EQUITY | |||
Common stock: $0.001 par value, 1,000,000,000 shares authorized, 598,042,000and 8,000,000 shares issued and outstanding, respectively | $ 598,042 | $ 598,042 | $ 8,000 |
Additional paid-in capital | 9,456,175 | 9,451,675 | $ 1,704,943 |
Subscription receivable | (317,000) | (317,000) | |
Scenario, Previously Reported [Member] | |||
STOCKHOLDERS' EQUITY | |||
Common stock: $0.001 par value, 1,000,000,000 shares authorized, 598,042,000and 8,000,000 shares issued and outstanding, respectively | 531,042 | 531,042 | |
Additional paid-in capital | 9,206,175 | 9,201,675 | |
Subscription receivable | 0 | 0 | |
Scenario, Adjustment [Member] | |||
STOCKHOLDERS' EQUITY | |||
Common stock: $0.001 par value, 1,000,000,000 shares authorized, 598,042,000and 8,000,000 shares issued and outstanding, respectively | 67,000 | 67,000 | |
Additional paid-in capital | 250,000 | 250,000 | |
Subscription receivable | $ (317,000) | $ (317,000) |
RESTATEMENT OF CONSOLIDATED F37
RESTATEMENT OF CONSOLIDATED FINANCIAL STATEMENTS (Details 1) - shares | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Apr. 30, 2015 | Apr. 30, 2014 | Apr. 30, 2015 | Apr. 30, 2014 | Jul. 31, 2014 | Jul. 31, 2013 | |
Consolidated Statement of Operations and Comprehensive Loss | ||||||
Weighted average number of common shares outstanding - basic and diluted (in shares) | 598,042,000 | 325,000,000 | 598,042,000 | 263,457,875 | 284,206,285 | 8,000,000 |
Scenario, Previously Reported [Member] | ||||||
Consolidated Statement of Operations and Comprehensive Loss | ||||||
Weighted average number of common shares outstanding - basic and diluted (in shares) | 591,042,000 | 591,042,000 | 263,079,329 | |||
Scenario, Adjustment [Member] | ||||||
Consolidated Statement of Operations and Comprehensive Loss | ||||||
Weighted average number of common shares outstanding - basic and diluted (in shares) | 67,000,000 | 67,000,000 | 21,126,956 |
RESTATEMENT OF CONSOLIDATED F38
RESTATEMENT OF CONSOLIDATED FINANCIAL STATEMENTS (Details Textual) - USD ($) | Apr. 30, 2015 | Jul. 31, 2014 | Jul. 31, 2013 |
Common Stock, Value, Subscriptions | $ (317,000) | $ (317,000) | |
Common Stock, Par or Stated Value Per Share | $ 0.001 | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 1,000,000,000 | 1,000,000,000 | 1,000,000,000 |
Common Stock, Shares, Issued | 598,042,000 | 598,042,000 | 8,000,000 |
Common Stock, Shares, Outstanding | 598,042,000 | 598,042,000 | 8,000,000 |
ACQUISITIONS (Details Textual)
ACQUISITIONS (Details Textual) | 1 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
Jul. 25, 2014shares | May. 30, 2014USD ($) | May. 30, 2014HKD | Sep. 30, 2013USD ($)$ / sharesshares | Sep. 24, 2013USD ($)$ / sharesshares | Sep. 23, 2013USD ($)$ / sharesshares | Sep. 15, 2013shares | Apr. 30, 2015shares | Jul. 31, 2014shares | |
Business Acquisition, Percentage of Voting Interests Acquired | 100.00% | 100.00% | |||||||
Mr. Zhou Jian [Member] | |||||||||
Stock Issued During Period, Shares, Acquisitions | 264,850,740 | ||||||||
Mr. Zhou Deng Rong [Member] | |||||||||
Stock Issued During Period, Shares, Acquisitions | 8,191,260 | ||||||||
Common Stock [Member] | |||||||||
Stock Issued During Period, Shares, Acquisitions | 250,000,000 | 273,042,000 | |||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | 250,000,000 | ||||||||
Sale of Stock, Price Per Share | $ / shares | $ 0.001 | $ 0.001 | |||||||
Business Acquisition, Equity Interest Issued or Issuable, Value Assigned | $ | $ 250,000 | ||||||||
Percentage Of Common Stock Shares Issued And Outstanding | 45.70% | ||||||||
Common Stock [Member] | 24 Shareholders [Member] | |||||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | 250,000,000 | ||||||||
Sale of Stock, Price Per Share | $ / shares | $ 0.001 | ||||||||
Business Acquisition, Equity Interest Issued or Issuable, Value Assigned | $ | $ 250,000 | ||||||||
Luck Sky (Hong Kong) Shares Limited [Member] | |||||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | 250,000,000 | ||||||||
Luck Sky (Hong Kong) Shares Limited [Member] | Common Stock [Member] | |||||||||
Stock Issued During Period, Shares, Acquisitions | 250,000,000 | ||||||||
Business Combination, Step Acquisition, Equity Interest in Acquiree, Percentage | 41.00% | ||||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | 250,000,000 | ||||||||
Sale of Stock, Price Per Share | $ / shares | $ 0.001 | ||||||||
Business Acquisition, Equity Interest Issued or Issuable, Value Assigned | $ | $ 250,000 | ||||||||
Luck Sky (Hong Kong) Aerodynamic Electricity Limited [Member] | Common Stock [Member] | |||||||||
Business Acquisition, Percentage of Voting Interests Acquired | 100.00% | 100.00% | |||||||
Business Combination, Consideration Transferred, Total | $ 1,289.98 | HKD 10,000 | |||||||
Sanhe City Lucksky Electrical Engineering Co., Ltd. [Member] | Mr. Zhou Jian [Member] | |||||||||
Stock Issued During Period, Shares, Acquisitions | 264,850,740 | ||||||||
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 97.00% | ||||||||
Sanhe City Lucksky Electrical Engineering Co., Ltd. [Member] | Mr. Zhou Deng Rong [Member] | |||||||||
Stock Issued During Period, Shares, Acquisitions | 8,191,260 | ||||||||
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 3.00% |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) | Apr. 30, 2015 | Jul. 31, 2014 | Jul. 31, 2013 |
Inventory [Line Items] | |||
Raw materials | $ 295,539 | $ 115,839 | $ 0 |
Accessory parts | 899,252 | 635,708 | 0 |
Contracts work in process | 980,923 | 1,030,106 | 0 |
Total | $ 2,175,714 | $ 1,781,653 | $ 0 |
PROPERTY, PLANT AND EQUIPMENT41
PROPERTY, PLANT AND EQUIPMENT (Details) - USD ($) | Apr. 30, 2015 | Jul. 31, 2014 | Jul. 31, 2013 |
Property, Plant and Equipment [Line Items] | |||
Total property, plant and equipment | $ 8,175,697 | $ 6,851,953 | $ 0 |
Less: accumulated depreciation | (382,457) | (72,697) | 0 |
Total | 7,793,240 | 6,779,256 | 0 |
Machinery equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Total property, plant and equipment | 5,281,800 | 3,997,506 | 0 |
Computer and office equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Total property, plant and equipment | 56,630 | 59,316 | 0 |
Vehicle [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Total property, plant and equipment | 74,205 | 38,558 | |
Property under capital lease [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Total property, plant and equipment | $ 2,763,062 | $ 2,756,573 | $ 0 |
PROPERTY, PLANT AND EQUIPMENT42
PROPERTY, PLANT AND EQUIPMENT (Details Textual) - USD ($) | 9 Months Ended | 12 Months Ended | ||
Apr. 30, 2015 | Apr. 30, 2014 | Jul. 31, 2014 | Jul. 31, 2013 | |
Property, Plant and Equipment [Line Items] | ||||
Depreciation | $ 310,560 | $ 0 | $ 74,053 | $ 0 |
General and Administrative Expense [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Depreciation | 121,321 | 0 | 34,456 | 0 |
Construction in Progress [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Depreciation | $ 189,241 | $ 0 | $ 38,241 | $ 0 |
BILLINGS IN EXCESS OF COSTS (De
BILLINGS IN EXCESS OF COSTS (Details) - USD ($) | Apr. 30, 2015 | Jul. 31, 2014 |
Billings In Excess Of Costs [Line Items] | ||
Costs incurred on uncompleted contracts | $ 16,716,459 | $ 7,863,873 |
Billings to date | (23,380,309) | (11,710,958) |
Billings in Excess of Cost | (6,663,850) | (3,847,085) |
Included in the accompanying balance sheets as follows: | ||
Costs in excess of billings on uncompleted contracts | 0 | 0 |
Billings on uncompleted contracts in excess of costs | (6,663,850) | (3,847,085) |
Billings in Excess of Cost, Current | $ (6,663,850) | $ (3,847,085) |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) | 9 Months Ended | 12 Months Ended | ||||||
Apr. 30, 2015USD ($) | Jul. 31, 2014USD ($) | Apr. 25, 2015USD ($) | Apr. 25, 2015CNY (¥) | Apr. 30, 2014USD ($) | Apr. 30, 2014CNY (¥) | Jul. 18, 2013USD ($) | Jul. 18, 2013CNY (¥) | |
Rental fees: | ||||||||
LuckSky Group | $ 172,611 | $ 52,542 | ||||||
Prepaid expenses on behalf of the company: | ||||||||
Total | 862,927 | 3,080,147 | ||||||
Kelitai Air Powered Machinery Co Ltd [Member] | ||||||||
Rental fees: | ||||||||
LuckSky Group | 133,324 | 33,253 | ||||||
Purchase Fixed assets: | ||||||||
Payments to Acquire Productive Assets | 0 | 1,235,667 | ||||||
Borrowings: | ||||||||
Short-term Debt | 0 | 1,242,198 | $ 507,917 | ¥ 3,150,000 | $ 483,830 | ¥ 3,000,000 | $ 1,242,198 | ¥ 7,722,000 |
Prepaid expenses on behalf of the company: | ||||||||
Prepaid Expense, Current | 0 | 1,510 | ||||||
Sanhe Dong Yi Glass Machine Company Limited [Member] | ||||||||
Rental fees: | ||||||||
Sanhe Dong Yi (Capital lease interest payable) | 172,611 | 52,542 | ||||||
Borrowings: | ||||||||
Short-term Debt | 0 | 160,865 | ||||||
Zhou Deng Rong [Member] | ||||||||
Prepaid expenses on behalf of the company: | ||||||||
Prepaid Expense, Current | $ 556,992 | $ 354,112 |
RELATED PARTY TRANSACTIONS (D45
RELATED PARTY TRANSACTIONS (Details Textual) | May. 01, 2012USD ($) | May. 01, 2012CNY (¥) | Apr. 25, 2015USD ($) | Sep. 30, 2014USD ($) | Sep. 30, 2014CNY (¥) | Aug. 31, 2014CNY (¥) | Jul. 31, 2014CNY (¥) | Jul. 25, 2014shares | May. 31, 2014USD ($) | May. 31, 2014CNY (¥) | May. 30, 2014USD ($) | May. 30, 2014HKD | Apr. 30, 2014USD ($) | Sep. 30, 2013USD ($)$ / sharesshares | Sep. 24, 2013USD ($)$ / sharesshares | Sep. 23, 2013USD ($)$ / sharesshares | Sep. 15, 2013shares | Jul. 18, 2013CNY (¥) | Apr. 28, 2012a | Apr. 30, 2015USD ($)a | Apr. 30, 2015CNY (¥) | Jul. 31, 2014USD ($)m²shares | Jul. 31, 2014CNY (¥)shares | Apr. 25, 2015CNY (¥) | Jul. 31, 2014CNY (¥)m² | Apr. 30, 2014CNY (¥) | Jul. 31, 2013USD ($) | Jul. 18, 2013USD ($) | Jul. 18, 2013CNY (¥) |
Related Party Transaction [Line Items] | |||||||||||||||||||||||||||||
Due from Related Parties, Current | $ 403,109 | $ 0 | |||||||||||||||||||||||||||
Prepaid Rent | 3,080,147 | $ 97,110 | |||||||||||||||||||||||||||
Due to Related Parties, Current | $ 18,978 | $ 18,934 | |||||||||||||||||||||||||||
Lease Expiration Date | Apr. 30, 2024 | Apr. 30, 2024 | Apr. 30, 2024 | Apr. 30, 2024 | |||||||||||||||||||||||||
Accrued Rent, Current | $ 172,611 | $ 52,542 | |||||||||||||||||||||||||||
Operating Lease Expiration Period | 30 years | 30 years | |||||||||||||||||||||||||||
Business Acquisition, Percentage of Voting Interests Acquired | 100.00% | 100.00% | |||||||||||||||||||||||||||
Business Acquisition Percentage Of Issued And Outstanding Shares | 45.70% | 45.70% | 45.70% | ||||||||||||||||||||||||||
Percentage Of Common Stock Issued And Outstanding Shares | 45.70% | ||||||||||||||||||||||||||||
Common Stock [Member] | |||||||||||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||||||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | shares | 250,000,000 | ||||||||||||||||||||||||||||
Stock Issued During Period, Shares, Acquisitions | shares | 250,000,000 | 273,042,000 | 273,042,000 | ||||||||||||||||||||||||||
Sale of Stock, Price Per Share | $ / shares | $ 0.001 | $ 0.001 | |||||||||||||||||||||||||||
Business Acquisition, Equity Interest Issued or Issuable, Value Assigned | $ 250,000 | ||||||||||||||||||||||||||||
Lucksky Hong Kong Shares Limited [Member] | |||||||||||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||||||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | shares | 250,000,000 | 250,000,000 | |||||||||||||||||||||||||||
Lucksky Hong Kong Shares Limited [Member] | Common Stock [Member] | |||||||||||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||||||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | shares | 250,000,000 | ||||||||||||||||||||||||||||
Stock Issued During Period, Shares, Acquisitions | shares | 250,000,000 | ||||||||||||||||||||||||||||
Business Combination, Step Acquisition, Equity Interest in Acquiree, Percentage | 41.00% | ||||||||||||||||||||||||||||
Sale of Stock, Price Per Share | $ / shares | $ 0.001 | ||||||||||||||||||||||||||||
Business Acquisition, Equity Interest Issued or Issuable, Value Assigned | $ 250,000 | ||||||||||||||||||||||||||||
Shareholders [Member] | Common Stock [Member] | |||||||||||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||||||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | shares | 250,000,000 | ||||||||||||||||||||||||||||
Sale of Stock, Price Per Share | $ / shares | $ 0.001 | ||||||||||||||||||||||||||||
Business Acquisition, Equity Interest Issued or Issuable, Value Assigned | $ 250,000 | ||||||||||||||||||||||||||||
Luck Sky Hong Kong Aerodynamic Electricity Limited [Member] | Common Stock [Member] | |||||||||||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||||||||||
Business Acquisition, Percentage of Voting Interests Acquired | 100.00% | 100.00% | |||||||||||||||||||||||||||
Business Combination, Consideration Transferred, Total | $ 1,289.98 | HKD 10,000 | |||||||||||||||||||||||||||
Factory [Member] | |||||||||||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||||||||||
Area of Land | m² | 1,296 | 1,296 | |||||||||||||||||||||||||||
Office And Factory [Member] | |||||||||||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||||||||||
Area of Land | m² | 5,160 | 5,160 | |||||||||||||||||||||||||||
Rental Income, Nonoperating | 113,492 | ¥ 697,248 | $ 113,492 | ¥ 697,248 | |||||||||||||||||||||||||
Agricultural Land [Member] | |||||||||||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||||||||||
Area of Land | 44.3 | 1,200 | 1,200 | ||||||||||||||||||||||||||
Rental Income, Nonoperating | 21,095 | 129,600 | $ 21,095 | 129,600 | |||||||||||||||||||||||||
Payments for Rent | $ 5,617 | ¥ 34,510 | |||||||||||||||||||||||||||
Operating Lease Expiration Period | 18 years and 8 months | ||||||||||||||||||||||||||||
Sanhe Dong Yi Glass Machine Company Limited [Member] | |||||||||||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||||||||||
Short-term Debt | $ 0 | 160,865 | |||||||||||||||||||||||||||
Prepaid Rent | 3,965 | ¥ 12,000 | |||||||||||||||||||||||||||
Payments to Acquire Furniture and Fixtures | $ 1,487 | ¥ 9,000 | |||||||||||||||||||||||||||
Related Party Transaction, Purchases from Related Party | $ 1,261,872 | ¥ 7,844,300 | 1,261,872 | 7,844,300 | |||||||||||||||||||||||||
Payments to Acquire Machinery and Equipment | 47,265 | 162,900 | |||||||||||||||||||||||||||
Payments to Acquire Other Productive Assets | $ 21,000 | 130,919 | |||||||||||||||||||||||||||
Sanhe Dong Yi Glass Machine Company Limited [Member] | Office And Factory [Member] | |||||||||||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||||||||||
Area of Land | 4,748.96 | 4,748.96 | 4,748.96 | ||||||||||||||||||||||||||
Payments for Rent | ¥ | ¥ 1,306,500 | ¥ 1,306,500 | |||||||||||||||||||||||||||
Operating Lease Expiration Period | 30 years | 30 years | |||||||||||||||||||||||||||
Kelitai Air Powered Machinery Co Ltd [Member] | |||||||||||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||||||||||
Short-term Debt | $ 507,917 | $ 483,830 | $ 0 | $ 1,242,198 | ¥ 3,150,000 | ¥ 3,000,000 | $ 1,242,198 | ¥ 7,722,000 | |||||||||||||||||||||
Repayments of Short-term Debt | ¥ | ¥ 1,000,000 | ¥ 2,000,000 | ¥ 5,233,000 | ||||||||||||||||||||||||||
Short-term Debt, Percentage Bearing Fixed Interest Rate | 5.00% | 5.00% | |||||||||||||||||||||||||||
Due from Related Parties, Current | $ 403,109 | ||||||||||||||||||||||||||||
Prepaid Rent | 1,242,198 | ||||||||||||||||||||||||||||
Due to Related Parties, Current | 0 | 1,235,667 | ¥ 7,722,000 | ||||||||||||||||||||||||||
Accrued Rent, Current | 133,324 | $ 33,253 | |||||||||||||||||||||||||||
Debt Instrument, Maturity Date | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2014 | ||||||||||||||||||||||||||
Zhou Jian [Member] | |||||||||||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||||||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | shares | 264,850,740 | 264,850,740 | 264,850,740 | ||||||||||||||||||||||||||
Business Acquisition, Percentage of Voting Interests Acquired | 97.00% | 97.00% | 97.00% | ||||||||||||||||||||||||||
Zhou Deng Rong [Member] | |||||||||||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||||||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | shares | 8,191,260 | 8,191,260 | 8,191,260 | ||||||||||||||||||||||||||
Business Acquisition, Percentage of Voting Interests Acquired | 3.00% | 3.00% | 3.00% | ||||||||||||||||||||||||||
Directors [Member] | |||||||||||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||||||||||
Due to Related Parties, Noncurrent | 417,776 | $ 430,928 | $ 8,999 | ||||||||||||||||||||||||||
Hengruier Machinery Company Limited [Member] | |||||||||||||||||||||||||||||
Related Party Transaction [Line Items] | |||||||||||||||||||||||||||||
Due to Related Parties, Current | $ 0 | $ 1,242,198 |
GOVERNMENT CONTRIBUTION PLAN (D
GOVERNMENT CONTRIBUTION PLAN (Details Textual) - USD ($) | 9 Months Ended | 12 Months Ended | |
Apr. 30, 2015 | Jul. 31, 2014 | Jul. 31, 2013 | |
Defined Contribution Plan Disclosure [Line Items] | |||
Defined Contribution Plan, Employer Discretionary Contribution Amount | $ 54,403 | $ 22,098 | $ 0 |
STATUTORY RESERVE (Details Text
STATUTORY RESERVE (Details Textual) | 9 Months Ended | 12 Months Ended |
Apr. 30, 2015 | Jul. 31, 2014 | |
Foreign Tax Authority [Member] | ||
Statutory Reserve Disclosure [Line Items] | ||
Statutory Surplus Reserve Fund Percentage | 10.00% | 10.00% |
Registered Capital Appropriation Percentage | 50.00% | 50.00% |
CHINA | ||
Statutory Reserve Disclosure [Line Items] | ||
Statutory Surplus Reserve Fund Percentage | 10.00% | 10.00% |
Registered Capital Appropriation Percentage | 50.00% | 50.00% |
CAPITAL STOCK AND EQUITY TRAN48
CAPITAL STOCK AND EQUITY TRANSACTIONS (Details Textual) - USD ($) | 1 Months Ended | 9 Months Ended | 11 Months Ended | 12 Months Ended | |||||
Jul. 25, 2014 | Sep. 30, 2013 | Sep. 23, 2013 | Apr. 30, 2015 | Jul. 31, 2009 | Jul. 31, 2014 | Jul. 31, 2010 | May. 30, 2014 | Jul. 31, 2013 | |
Class of Stock [Line Items] | |||||||||
Common Stock Shares Authorized | 1,000,000,000 | 1,000,000,000 | 1,000,000,000 | ||||||
Common Stock Par Or Stated Value Per Share | $ 0.001 | $ 0.001 | $ 0.001 | ||||||
Development Stage Entities, Stock Issued, Value, Issued for Cash | $ 25,000 | $ 30,000 | |||||||
Preferred stock, shares authorized | 100,000,000 | 100,000,000 | 100,000,000 | ||||||
Preferred Stock Par Or Stated Value Per Share | $ 0.001 | $ 0.001 | $ 0.001 | ||||||
Business Acquisition, Percentage of Voting Interests Acquired | 100.00% | ||||||||
Business Acquisition Percentage Of Issued And Outstanding Shares | 45.70% | 45.70% | |||||||
Chief Financial Officer [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Sale of Stock, Price Per Share | $ 0.001 | ||||||||
Stock Issued During Period, Shares, Restricted Stock Award, Net of Forfeitures | 5,000,000 | ||||||||
Exchange of Stock for Stock [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Stock Issued During Period, Shares, Acquisitions | 250,000,000 | ||||||||
Zhou Jian [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | 264,850,740 | 264,850,740 | |||||||
Business Acquisition, Percentage of Voting Interests Acquired | 97.00% | 97.00% | |||||||
Zhou Deng Rong [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | 8,191,260 | 8,191,260 | |||||||
Business Acquisition, Percentage of Voting Interests Acquired | 3.00% | 3.00% | |||||||
Common Stock [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Development Stage Entities, Stock Issued, Shares, Issued for Cash | 5,000,000 | 3,000,000 | |||||||
Development Stage Entities, Stock Issued, Value, Issued for Cash | $ 5,000 | $ 3,000 | |||||||
Stock Issued During Period, Shares, Acquisitions | 250,000,000 | 273,042,000 | |||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | 250,000,000 | ||||||||
Sale of Stock, Price Per Share | $ 0.001 | $ 0.001 | |||||||
Stock Issued During Period, Shares, Restricted Stock Award, Net of Forfeitures | 67,000,000 | ||||||||
Common Stock [Member] | Secondary Offering [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Sale of Stock, Price Per Share | $ 0.001 | ||||||||
Stock Issued During Period, Shares, Issued for Services | 67,000,000 | ||||||||
Stock Issued During Period, Value, Issued for Services | $ 67,000 | ||||||||
Common Stock [Member] | Non Related Party [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Stock Issued During Period, Shares, Restricted Stock Award, Net of Forfeitures | 7,000,000 | ||||||||
Common Stock [Member] | Chief Financial Officer [Member] | |||||||||
Class of Stock [Line Items] | |||||||||
Stock Issued During Period, Shares, Restricted Stock Award, Net of Forfeitures | 60,000,000 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) | Apr. 30, 2015 | Jul. 31, 2014 | Jul. 31, 2013 |
Deferred tax assets: | |||
Net operating losses | $ 224,460 | $ 170,552 | $ 59,350 |
Total deferred tax assets | 224,460 | 170,552 | 59,350 |
Less: valuation allowance | (224,460) | (170,552) | (59,350) |
Deferred tax assets, net | $ 0 | $ 0 | $ 0 |
INCOME TAXES (Details Textual)
INCOME TAXES (Details Textual) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Apr. 30, 2015 | Apr. 30, 2014 | Apr. 30, 2015 | Apr. 30, 2014 | Jul. 31, 2014 | Jul. 31, 2013 | |
Income Taxes [Line Items] | ||||||
Effective Income Tax Rate Reconciliation, Change in Enacted Tax Rate, Percent | 34.00% | 34.00% | ||||
Operating Loss Carryforwards | $ 660,179 | $ 660,179 | $ 501,624 | |||
Income Tax Expense (Benefit) | (20,548) | $ (27,857) | $ (179,120) | $ (38,261) | (113,932) | $ 0 |
CHINA | ||||||
Income Taxes [Line Items] | ||||||
Effective Income Tax Rate Reconciliation, Foreign Income Tax Rate Differential, Percent | 25.00% | |||||
Luck Sky HK [Member] | ||||||
Income Taxes [Line Items] | ||||||
Income (Loss) from Subsidiaries, Net of Tax | 0 | |||||
Luck Sky Shenzhen [Member] | ||||||
Income Taxes [Line Items] | ||||||
Operating Loss Carryforwards | 30,036 | $ 30,036 | $ 6,283 | |||
Effective Income Tax Rate Reconciliation, Change in Deferred Tax Assets Valuation Allowance, Percent | 100.00% | |||||
Operating Loss Carry forwards Expiration Term | 5 years | |||||
Income Tax Expense (Benefit) | $ 7,529 | |||||
Sanhe [Member] | ||||||
Income Taxes [Line Items] | ||||||
Operating Loss Carryforwards | 901,742 | 901,742 | $ 341,795 | |||
Deferred Tax Assets, Net | $ 298,171 | $ 298,171 | $ 111,844 | $ 0 | ||
Operating Loss Carry forwards Expiration Term | 5 years |
COMMITMENTS, CONTINGENCIES, R51
COMMITMENTS, CONTINGENCIES, RISKS AND UNCERTAINTIES (Details) - USD ($) | Apr. 30, 2015 | Jul. 31, 2014 |
Operating Leased Assets [Line Items] | ||
Remaining 2,015 | $ 85,997 | $ 345,554 |
Year ending July 31, 2016 | 343,989 | 345,554 |
Year ending July 31, 2017 | 343,989 | 345,554 |
Year ending July 31, 2018 | 343,989 | 345,554 |
After 2,018 | 6,191,227 | 6,075,426 |
Total | $ 7,309,191 | $ 7,457,642 |
COMMITMENTS, CONTINGENCIES, R52
COMMITMENTS, CONTINGENCIES, RISKS AND UNCERTAINTIES (Details Textual) - USD ($) | 1 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 23, 2013 | Sep. 15, 2013 | Apr. 30, 2015 | Apr. 30, 2014 | Jul. 31, 2014 | Jul. 31, 2013 | |
Operating Leased Assets [Line Items] | ||||||
Capital Leases, Future Minimum Payments Due, Next Twelve Months | $ 19,508,643 | $ 27,777,872 | ||||
Operating Leases, Rent Expense, Net | $ 258,801 | $ 2,943 | $ 89,760 | $ 0 | ||
Stock Issued During Period, Shares, Restricted Stock Award, Gross | 67,000,000 | |||||
Stock Issued During Period, Shares, Restricted Stock Award, Forfeited | 67,000,000 | 62,000,000 | ||||
Secondary Offering [Member] | Common Stock [Member] | ||||||
Operating Leased Assets [Line Items] | ||||||
Sale of Stock, Price Per Share | $ 0.001 | |||||
Stock Issued During Period, Shares, Issued for Services | 67,000,000 | |||||
Stock Issued During Period, Value, Issued for Services | $ 67,000 | |||||
Restricted Stock [Member] | ||||||
Operating Leased Assets [Line Items] | ||||||
Weighted Average Number of Shares Outstanding, Diluted | 67,000,000 | |||||
Earnings Per Share, Diluted | $ 0 | |||||
Chief Financial Officer [Member] | ||||||
Operating Leased Assets [Line Items] | ||||||
Stock Issued During Period, Shares, Restricted Stock Award, Gross | 60,000,000 | |||||
Stock Issued During Period, Shares, Restricted Stock Award, Net of Forfeitures | 5,000,000 | |||||
Sale of Stock, Price Per Share | $ 0.001 | |||||
Chief Financial Officer [Member] | Common Stock [Member] | ||||||
Operating Leased Assets [Line Items] | ||||||
Stock Issued During Period, Shares, Restricted Stock Award, Net of Forfeitures | 67,000,000 | |||||
Non-Related Parties [Member] | ||||||
Operating Leased Assets [Line Items] | ||||||
Stock Issued During Period, Shares, Restricted Stock Award, Gross | 7,000,000 | |||||
Stock Issued During Period, Shares, Restricted Stock Award, Net of Forfeitures | 7,000,000 | |||||
Lucksky Hong Kong Shares Limited [Member] | ||||||
Operating Leased Assets [Line Items] | ||||||
Stock Issued During Period, Shares, New Issues | 250,000,000 | 150,000,000 |