Document and Entity Information
Document and Entity Information | 3 Months Ended |
Mar. 31, 2016shares | |
Document And Entity Information | |
Entity Registrant Name | CHINA SHOUGUAN MINING Corp |
Document Type | 10-Q |
Document Period End Date | Mar. 31, 2016 |
Amendment Flag | false |
Entity Central Index Key | 1,493,893 |
Current Fiscal Year End Date | --12-31 |
Entity Common Stock, Shares Outstanding | 115,000,000 |
Entity Filer Category | Smaller Reporting Company |
Entity Current Reporting Status | No |
Entity Voluntary Filers | No |
Entity Well-known Seasoned Issuer | No |
Document Fiscal Year Focus | 2,016 |
Document Fiscal Period Focus | Q1 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Mar. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 285,328 | $ 40,488 |
Accounts receivable | 1,691,094 | 82,174 |
Deposits and prepayments | 82,719 | 170,635 |
Prepaid mining rights, current | 2,047,178 | 2,033,679 |
Total current assets | 4,106,319 | 2,326,976 |
Non-current assets: | ||
Prepaid mining rights, non-current | 1,516,262 | 2,014,684 |
Property, plant and equipment, net | 2,198,254 | 2,296,636 |
TOTAL ASSETS | 7,820,835 | 6,638,296 |
Current liabilities: | ||
Accounts payable | 209,647 | 208,264 |
Loans payable, unsecured | 9,898,272 | 5,988,363 |
Note payable, related party | 121,541 | 1,665,190 |
Accrued liabilities and other payable | 403,782 | 567,275 |
Total current liabilities | 10,633,242 | 8,429,092 |
Long-term liabilities: | ||
Notes payable, related party | 740,001 | 785,037 |
Loans payable, unsecured | 132,963 | 69,542 |
Total long-term liabilities | 872,964 | 854,579 |
Total liabilities | 11,506,206 | 9,283,671 |
Stockholders' equity: | ||
Common stock, $0.0001 par value; 300,000,000 shares authorized; 115,000,000 and 115,000,000 shares issued and outstanding, respectively | 11,500 | 11,500 |
Additional paid-in capital | 8,899,597 | 8,899,597 |
Subscription receivables | (718,459) | (718,459) |
Statutory reserve | 308,898 | 308,898 |
Accumulated other comprehensive income | 489,451 | 520,213 |
Accumulated deficit | (12,676,358) | (11,667,124) |
Total stockholders' equity | (3,685,371) | (2,645,375) |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 7,820,835 | $ 6,638,296 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2016 | Dec. 31, 2015 |
Assets [Abstract] | ||
Common Stock, par value | $ 0.0001 | $ 0.0001 |
Common Stock, shares authorized | 300,000,000 | 300,000,000 |
Common Stock, shares issued | 115,000,000 | 115,000,000 |
Common Stock, shares outstanding | 115,000,000 | 115,000,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Revenue, Net [Abstract] | ||
Revenues, net | $ 0 | $ 0 |
Cost of revenue | ||
Mining operating cost | 0 | (185,133) |
Mining related depreciation and amortization | (716,078) | (657,336) |
Total cost of revenue | (716,078) | (842,469) |
Gross loss | (716,078) | (842,469) |
Operating expenses: | ||
General and administrative | (208,924) | (135,408) |
Total operating expenses | (208,924) | (135,408) |
Loss from operations | (925,002) | (977,877) |
Other income (expense): | ||
Interest expense | (84,291) | (57,878) |
Interest income | 59 | 24 |
Loss before income taxes | (1,009,234) | (1,035,731) |
Income tax expense | 0 | 0 |
NET LOSS | (1,009,234) | (1,035,731) |
Other comprehensive income: | ||
Foreign currency translation (loss) gain | (30,762) | (2,484) |
COMPREHENSIVE LOSS | $ (1,039,996) | $ (1,038,215) |
Net loss per share - Basic and diluted | $ (.01) | $ (.01) |
Weighted average common shares outstanding - Basic and diluted | 115,000,000 | 115,000,000 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Cash flows from operating activities: | ||
Net loss | $ (1,009,234) | $ (1,035,731) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||
Depreciation of property, plant and equipment | 115,213 | 128,585 |
Amortization of prepaid mining right | 802,817 | 537,827 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 0 | 129,167 |
Deposits and prepayments | (1,498,319) | (27,240) |
Accounts payable | 0 | 3,012 |
Accrued liabilities and other payable | (164,862) | (162,587) |
Net cash provided used in operating activities | (1,754,385) | (426,967) |
Cash flows from investing activities: | ||
Payments on leased mining rights | (298,189) | 0 |
Purchase of plant and equipment | (3,178) | (633) |
Net cash provided by (used in) investing activities | (301,367) | (633) |
Cash flows from financing activities: | ||
Proceeds from short-term bank borrowing | 0 | 464,487 |
Proceeds from loans payable | 5,285,294 | 537,827 |
Repayment to loans payable | (2,978,494) | (79,004) |
Proceeds from related party note | 1,230,987 | 219,698 |
Repayments to a related party note | (1,240,882) | (705,532) |
Net cash provided by financing activities | 2,296,905 | 437,476 |
Effect of exchange rate changes on cash and cash equivalents | 3,687 | 71 |
NET CHANGE IN CASH AND CASH EQUIVALENTS | 244,840 | 9,947 |
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR | 40,488 | 113,055 |
CASH AND CASH EQUIVALENTS, END OF YEAR | 285,328 | 123,002 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ||
Cash paid for interest | 0 | 0 |
Cash paid for income taxes | $ 84,291 | $ 57,878 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (Unaudited) - 3 months ended Mar. 31, 2016 - USD ($) | Common Stock | Additional Paid-In Capital | Subscriptions Receivable | StatutoryReserveMember | Accumulated Other Comprehensive (loss) Income | Accumulated Deficit | Total |
Beginning Balance, Shares at Dec. 31, 2015 | 115,000,000 | ||||||
Beginning Balance, Amount at Dec. 31, 2015 | $ 11,500 | $ 8,899,597 | $ (718,459) | $ 308,898 | $ 520,213 | $ (11,667,124) | $ (2,645,375) |
Foreign currency translation adjustment | $ (30,762) | (30,762) | |||||
Net loss for the period | $ (1,009,234) | (1,009,234) | |||||
Ending Balance, shares at Mar. 31, 2016 | 115,000,000 | ||||||
Ending Balance, amount at Mar. 31, 2016 | $ 11,500 | $ 8,899,597 | $ (718,459) | $ 308,898 | $ 489,451 | $ (12,676,358) | $ (3,685,371) |
NOTE 1 - BASIS OF PRESENTATION
NOTE 1 - BASIS OF PRESENTATION | 3 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
NOTE - 1 BASIS OF PRESENTATION | NOTE 1 BASIS OF PRESENTATION The accompanying unaudited condensed consolidated financial statements have been prepared by management in accordance with both accounting principles generally accepted in the United States (GAAP), and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Certain information and note disclosures normally included in audited financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to those rules and regulations, although the Company believes that the disclosures made are adequate to make the information not misleading. In the opinion of management, the consolidated balance sheet as of December 31, 2015 which has been derived from audited financial statements and these unaudited condensed consolidated financial statements reflect all normal and recurring adjustments considered necessary to state fairly the results for the periods presented. The results for the period ended March 31, 2016 are not necessarily indicative of the results to be expected for the entire fiscal year ending December 31, 2016 or for any future period. These unaudited condensed consolidated financial statements and notes thereto should be read in conjunction with the Managements Discussion and the audited financial statements and notes thereto included in the Annual Report on Form 10-K for the year ended December 31, 2015. |
NOTE 2 - ORGANIZATION AND BACKG
NOTE 2 - ORGANIZATION AND BACKGROUND | 3 Months Ended |
Mar. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
2. ORGANIZATION AND BACKGROUND | NOTE 2 ORGANIZATION AND BACKGROUND China ShouGuan Mining Corporation (CHSO or the Company) was incorporated in the State of Nevada on May 4, 2010. The Company, through its subsidiaries and variable interest entities, is principally engaged in the project management of gold mining operations in China. In May 2009, the Company commenced its first project, the Cunli Ji Gold Mine which is located in Shandong Province, the People Republic of China (PRC). Following May 2011, the Company commenced its second project, the Dayuan Gold Mine which is located in Shandong Province, the PRC. The details of the Companys subsidiaries and VIEs are described below: Name Place of incorporation and kind of legal entity Principal activities and place of operation Particulars of issued/ registered share capital Effective interest Held Bei Sheng Limited (BSL) British Virgin Islands, a limited liability company Investment holding in GWIL and provision of mining technical advice 50,000 issued shares of US$1 each 100% Golden Wide International Limited (GWIL) Hong Kong, a limited liability company 100%-investment holding in SBCL 10,000 issued shares of HK$1 each 100% Shoujin Business Consulting (Shenzhen) Limited (SBCL) The PRC, a limited liability company Provision of consulting service in the PRC RMB100,000 100% Shenzhen Shouguan Investment Co., Ltd (SSIC) # The PRC, a limited liability company 99%-investment holding in JinGuan RMB18,100,000 N/A Yantai Jinguan Investment Limited (JinGuan) # The PRC, a limited liability company 100%-investment holding in XinGuan RMB5,000,000 N/A DaxinganlingYiguanyuan Mining Investment Company Limited (DYM) # The PRC, a limited liability company Mine exploration in Daxinganling RMB4,010,000 N/A # represents variable interest entity (VIE) The Company and its subsidiaries and VIEs are hereinafter collectively referred to as (the Company). |
NOTE 3 - GOING CONCERN UNCERTAI
NOTE 3 - GOING CONCERN UNCERTAINTIES | 3 Months Ended |
Mar. 31, 2016 | |
Loan payable from director of the company (equivalent to RMB4,200,000) | |
3. GOING CONCERN UNCERTAINTIES | NOTE 3 GOING CONCERN UNCERTAINTIES These condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the discharge of liabilities in the normal course of business for the foreseeable future. As of March 31, 2016, the Company suffered the accumulated deficits of $12,676,358 from prior years and suffered from a working capital deficit of $6,526,923. The continuation of the Company as a going concern is dependent upon the continuing financial support from its stockholders or external financing. Management believes the existing stockholders will provide the additional cash to meet with the Companys obligations as they become due. However, there can be no assurance that the Company will be able to obtain sufficient funds to meet its obligations. These factors raise substantial doubt about the Companys ability to continue as a going concern. These condensed consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets and liabilities that may result in the Company not being able to continue as a going concern. |
NOTE 4 - SUMMARY OF SIGNIFICANT
NOTE 4 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 4 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accompanying condensed consolidated financial statements reflect the application of certain significant accounting policies as described in this note and elsewhere in the accompanying condensed consolidated financial statements and notes. l Exploration stage company Despite the fact that the Company commenced its production in 2009, it is still considered an exploration stage company under the criteria set forth by the Securities and Exchange Commission (SEC) since it has not yet demonstrated the existence of proven or probable reserves, defined by SEC Industry Guide 7 l Proven or probable reserves The definition of proven or probable reserves is set forth in SEC Industry Guide 7. l Use of estimates In preparing these condensed consolidated financial statements, management makes estimates and assumptions that affect the reported amounts of assets and liabilities in the balance sheet and revenues and expenses during the periods reported. Actual results may differ from these estimates. l Basis of consolidation The condensed consolidated financial statements include the financial statements of CHSO, its subsidiaries and VIEs. All inter-company balances and transactions between the Company and its subsidiaries and VIEs have been eliminated upon consolidation. The Company has adopted ASC Topic 810-10-5-8, Variable Interest Entities l Variable interest entity The Company's subsidiary, SBCL entered into a series of amended agreements ("VIE agreements") amongst SSIC, JinGuan, DYM and the individual owners of SSIC, JinGuan and DYM and details of the VIE agreements are as follows: 1. Exclusive Technical Service and Business Consulting Agreement, SBCL has the exclusive right to provide to SSIC, JinGuan and DYM consulting services, including operational management, human resources management, research and development of the technologies related to the operations of SSIC, JinGuan and DYM. SSIC, JinGuan and DYM pays to SBCL annually consulting service fees in an amount equals to all of their revenue for such year. These agreements run for 10 year terms and are subject to automatic renewal for an additional 10 year term provided that no objection is made by both parties on the renewal.; 2. Exclusive Option Agreement, SBCL has the option to purchase SSIC, JinGuan and DYM all assets and ownership at any time.; 3. Equity Pledge Agreement, SSIC, JinGuan and DYM agree to pledge their legal interest to SBCL as a security for the obligations under the Exclusive Technical Service and Business Consulting Agreement; 4. Proxy Agreement, SSIC, JinGuan and DYM irrevocably grant and entrust SBCL the right to exercise its voting and other stockholders right. 5. Operating Agreement, SBCL agrees to participate in the operations of SSIC, JinGuan and DYM in different aspects. With the above agreements, SBCL demonstrates its ability to control SSIC and JinGuan as the primary beneficiaries and the operating results of the VIEs was included in the condensed consolidated financial statements for the three months ended March 31, 2016 and 2015. l Cash and cash equivalents Cash and cash equivalents are carried at cost and represent cash on hand, demand deposits placed with banks or other financial institutions and all highly liquid investments with an original maturity of three months or less as of the purchase date of such investments. l Mining rights, exploration and development costs Costs of mining rights are capitalized upon acquisition. Subsequent exploration and development costs are expensed as incurred until such time as a feasibility study has been completed which establishes, in compliance with SEC Industry Guide 7 l Prepaid mining rights Prepaid mining rights represent certain amount of lease prepayment made for the operation of the mining license of Dayuan Gold Mine and are being amortized using a straight-line basis over its scheduled lease term. The rent expense on prepaid mining rights for the three months ended March 31, 2016 and 2015 was $504,628 and $537,827, respectively. As of March 31, 2016, the estimated annual amortization of the prepaid mining rights for the next five years and thereafter is as follows: Period ending March 31: 2017 1,535,383 2018 1,880,722 2019 31,017 2020 31,017 2021 31,017 Thereafter 54,284 Total: $ 3,563,440 l Property, plant and equipment Property, plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses, if any. Depreciation is calculated on the straight-line basis over the following expected useful lives from the date on which they become fully operational and after taking into account their estimated residual values: Expected useful life Residual value Plant and machinery 5-10 years 5% Motor vehicles 5 years 5% Office equipment 3-5 years 5% Expenditure for repairs and maintenance is expensed as incurred. When assets have retired or sold, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in the results of operations. Depreciation expense for the three months ended March 31, 2016 and 2015 were $115,213 and $128,585, respectively. l Construction in progress Construction in progress is stated at cost, which includes the costs of self-constructed assets, including mine development assets during the construction phase. Indirect overhead costs are not included in the cost of self-constructed assets. Construction in progress is not depreciated until such time as the assets are completed and put into operational use. No capitalized interest is incurred during the period of construction. l Impairment of long-lived assets In accordance with the provisions of ASC Topic 360-10-5, Impairment or Disposal of Long-Lived Assets Numerous factors including, but not limited to, such things as unexpected grade changes, gold recovery problems, shortages of equipment and consumables, equipment failures, and collapse of pit walls, could impact our ability to achieve forecasted production schedules from proven and probable reserves. Additionally, commodity prices, capital expenditure requirements and reclamation costs could differ from the assumptions used in the cash flow models used to assess impairment. The ability to achieve the estimated quantities of recoverable minerals from exploration stage mineral interests involves further risks in addition to those factors applicable to mineral interests where proven and probable reserves have been identified, due to the lower level of confidence that the identified mineralized material can ultimately be mined economically. There has been no impairment charge for the periods presented. l Revenue recognition In accordance with the ASC Topic 605, Revenue Recognition (a) Product sales The Company derives revenues from the sales of non-refined gold concentrate to smelters, whereas the smelter usually takes 6 days for the production from non-refined gold concentrate to gold bullion. The Company generally recognizes its revenues, net of value-added taxes ("VAT") at the time of gold bullion is produced by the smelter and its selling price is determined by the market value of gold bullion quoted by the Shanghai Gold Exchange. The Company is subject to VAT which is levied on the standard gold products at the standard rate of 17% on the invoiced value of sales. The Companys VIE, XinGuan is granted with a preferential tax treatment under the Chinese tax law of the Notice from Ministry of Finance and State Tax Bureau in Relation to Exemption of Value Added Tax on Gold Production Notice regarding issues on Tax Policy on Gold Transaction (b) Interest income Interest income is recognized on a time apportionment basis, taking into account the principal amounts outstanding and the interest rates applicable. l Comprehensive income ASC Topic 220, Comprehensive Income, l Income taxes The Company adopts ASC Topic 740, Income Taxes For the three months ended March 31, 2016 and 2015, the Company did not have any interest and penalties associated with tax positions. As of March 31, 2016, the Company did not have any significant unrecognized uncertain tax positions. The Company conducts major businesses in the PRC and is subject to tax in this jurisdiction. As a result of its business activities, the Company files tax returns that are subject to examination by the foreign tax authority. l Net loss per share The Company calculates net loss per share in accordance with ASC Topic 260, Earnings per Share. l Foreign currencies translation Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the statement of operations. The reporting currency of the Company is the United States Dollars ("US$"). The Company's subsidiary in the PRC maintain its books and records in its local currency, Renminbi Yuan ("RMB"), which is functional currency as being the primary currency of the economic environment in which the entity operates. In general, for consolidation purposes, assets and liabilities of its subsidiaries and VIEs whose functional currency is not US$ are translated into US$, in accordance with ASC Topic 830-30, Translation of Financial Statement Translation of amounts from RMB into US$1 has been made at the following exchange rates for the respective period: March 31, 2016 March 31, 2015 Period-end RMB:US$1 exchange rate 6.44790 6.1091 Period average RMB:US$1 exchange rate 6.53947 6.1358 l Related parties Parties, which can be a corporation or individual, are considered to be related if the Company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operational decisions. Companies are also considered to be related if they are subject to common control or common significant influence. l Segment reporting ASC Topic 280, Segment Reporting l Fair value of financial instruments The carrying value of the Companys financial instruments include cash, accounts receivable, amounts due from (to) related parties, deposits and prepayments, accounts payable, amount due to a related party, income tax payable, accrued liabilities and other payable. Fair values were assumed to approximate carrying values for these financial instruments because they are short term in nature and their carrying amounts approximate fair values. The carrying value of the Companys loans and note payable approximated its fair value based on the current market prices or interest rates for similar debt instruments. The Company also follows the guidance of ASC Topic 820-10, Fair Value Measurements and Disclosures Level 1 Level 2 Level 3 Fair value estimates are made at a specific point in time based on relevant market information about the financial instrument. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates. l Recent accounting pronouncements The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and does not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations. |
NOTE 5 - AMOUNT DUE TO A RELATE
NOTE 5 - AMOUNT DUE TO A RELATED PARTY | 3 Months Ended |
Mar. 31, 2016 | |
Related Party Transactions [Abstract] | |
5. AMOUNT DUE TO A RELATED PARTY | NOTE 5 AMOUNT DUE TO A RELATED PARTY As of March 31, 2016, amount due to a related party represented temporary advances made by Mr. Zhang, the director of the Company, which was unsecured, interest-free with no fixed repayment term. Imputed interest is considered insignificant. |
NOTE 6 - LOANS PAYABLE, UNSECUR
NOTE 6 - LOANS PAYABLE, UNSECURED | 3 Months Ended |
Mar. 31, 2016 | |
Non-deductible items | |
6. LOANS PAYABLE, UNSECURED | NOTE 6 LOANS PAYABLE, UNSECURED As of March 31, 2016 and December 31, 2015, the Company also held the following short-term and long-term loans payable to third parties: March 31, 2016 December 31, 2015 Loans payable to certain individuals and financial institution in the PRC, unsecured: Equivalent to RMB3,000,000 (2015: RMB 3,000,000) with interest rate at 2.7% per annum, payable at its maturity, due May 7, 2016 $ 465,268 $ 462,200 Equivalent to RMB7,400,000 (2015: RMB 7,400,000) with interest rate at 2.7% per annum, payable at its maturity, due May 7, 2016 1,147,660 1,140,093 Equivalent to RMB5,800,000 (2015: RMB 8,800,000) with interest rate free, payable at its maturity, due June 2016 899,517 1,355,786 Equivalent to RMB2,000,000 (2015: RMB 2,000,000) with interest rate free, payable at its maturity, due April 13, 2016 310,179 308,133 Equivalent to RMB3,740,000 (2015: RMB 3,740,000) with interest rate at the bank of China Benchmark Lending Rate, payable at its maturity, due July 17, 2016 556,770 576,209 Equivalent to RMB5,000,000 with interest rate at the bank of China Benchmark Lending Rate, payable at its maturity, due April 26, 2016 775,447 770,333 Equivalent to RMB60,892 (2015: 887,305) with effective interest rate at 8.97% per annum, payable with monthly principal and interest payments, due February 28, 2017 9,444 136,704 Equivalent to RMB378,800 (2015:552,324) with effective interest rate at 1.75% per month, payable with monthly principal and interest payments, due April 10, 2018 58,748 85,094 Equivalent to RMB29,000,000 with effective interest rate at 4.79% per annum, payable with monthly principal and interest payments, due December 29, 2016 4,497,588 - Equivalent to RMB6,975,701, interest free, payable at its maturity due June 30, 2016 - 1,074,723 Equivalent to RMB640,000, interest free, payable at its maturity, due March 7, 2018 99,256 98,602 Equivalent to RMB324,709, interest free, payable at its maturity, due March 7, 2017 50,359 50,028 Equivalent to RMB1,486,000, interest free, payable at its maturity, due March 11, 2017 230,463 - Equivalent to RMB6,000,000, interest free, payable at its maturity, due July 17, 2016 930,536 - Total current and long-term liabilities 10,031,235 6,057,905 Less: long-term portion (132,963) (69,542) Total current liabilities $ 9,898,272 $ 5,988,363 |
NOTE 7 - NOTE PAYABLE, RELATED
NOTE 7 - NOTE PAYABLE, RELATED PARTY | 3 Months Ended |
Mar. 31, 2016 | |
Variable interest entity | |
7. NOTES PAYABLE, RELATED PARTY | NOTE 7 NOTE PAYABLE, RELATED PARTY As of March 31, 2016, the note due to Mr. Zhang, the director of the Company, which was unsecured, carried annual interest at Bank of China Benchmark Lending Rate and payable in a monthly installment. The interest expense to a related party amounted $12,343 and $22,814 for the three months ended March 31, 2016 and 2015, respectively. |
NOTE 8 - INCOME TAXES
NOTE 8 - INCOME TAXES | 3 Months Ended |
Mar. 31, 2016 | |
– Local Deferred | |
8. INCOME TAXES | NOTE 8 INCOME TAXES For the three months ended March 31, 2016 and 2015, the local (United States) and foreign components of (loss) profit before income taxes were comprised of the following: Three months ended March 31, 2016 2015 Tax jurisdictions from: Local $ - $ - Foreign (1,009,234) (1,035,731) Loss before income taxes $ (1,009,234) $ (1,035,731) The provision for income taxes consisted of the following: Three months ended March 31, 2016 2015 Current: Local $ - $ - Foreign, representing by: Hong Kong - - The PRC - - Deferred: Local - - Foreign - - Income tax expense $ - $ - The effective tax rate in the periods presented is the result of the mix of income earned in various tax jurisdictions that apply a broad range of income tax rates. The Company has subsidiaries that operate in various countries: United States, BVI, Hong Kong and the PRC that are subject to taxes in the jurisdictions in which they operate, as follows: United States of America The Company is registered in the State of Nevada and is subject to the tax laws of the United States of America. British Virgin Island Under the current BVI law, Bei Sheng is not subject to tax on its income or profits. Hong Kong Golden Wide is subject to Hong Kong Profits Tax, which is charged at the statutory income rate of 16.5% on assessable income. For the three months ended March 31, 2016 and 2015, Golden Wide suffered from an operating loss of $0 and $168, respectively. The PRC The Company generated its income from its subsidiaries and VIEs operating in the PRC for the three months ended March 31, 2016 and 2015, which are subject to the Corporate Income Tax Law of the Peoples Republic of China (the New CIT Law) at a unified income tax rate of 25%. A reconciliation of income tax rate to the effective income tax rate for the three months ended March 31, 2016 and 2015 is as follows: Three months ended March 31, 2016 2015 Loss before income taxes $ (1,008,459) $ (1,030,615) Statutory income tax rate 25% 25% Income tax expense at the statutory rate (252,114) (257,654) Net operating loss not recognized as deferred tax asset (252,114) 91,051 Non-deductible items 504,228 166,603 Income tax expense $ - $ - As of March 31, 2016, the Company incurred $1,571,307 of aggregate net operating loss carryforwards available to offset its taxable income for income tax purposes. The Company has provided for a full valuation allowance against the deferred tax assets of $1,571,307 on the expected future tax benefits from the net operating loss carryforwards as the management believes it is more likely than not that these assets will not be realized in the future. |
NOTE 9 - CONCENTRATIONS OF RISK
NOTE 9 - CONCENTRATIONS OF RISK | 3 Months Ended |
Mar. 31, 2016 | |
Risks and Uncertainties [Abstract] | |
9. CONCENTRATIONS OF RISK | NOTE 9 CONCENTRATIONS OF RISK The Company is exposed to the following concentrations of risk: (a) Major customers For the three months ended March 31, 2016, there was no revenue generated. (b) Major vendors For the three months ended March 31, 2016, there was no purchase incurred. For the three months ended March 31, 2015, there was a single vendor who accounted for 85% of the Companys purchase with $158,351 accounts payable balance at period-end. All vendors are located in the PRC. (c) Credit risk Financial instruments that are potentially subject to credit risk consist principally of accounts receivables. The Company believes the concentration of credit risk in its accounts and retention receivables is substantially mitigated by its ongoing credit evaluation process and relatively short collection terms. The Company does not generally require collateral from customers. Credit is extended based on evaluation of a customer's financial condition. The Company evaluates the need for an allowance for doubtful accounts based upon factors surrounding the credit risk of specific customers, historical trends and other information. (d) Exchange rate risk The reporting currency of the Company is US$, to date the majority of the revenues and costs are denominated in RMB and a significant portion of the assets and liabilities are denominated in RMB. As a result, the Company is exposed to foreign exchange risk as its revenues and results of operations may be affected by fluctuations in the exchange rate between US$ and RMB. If RMB depreciates against US$, the value of RMB revenues and assets as expressed in US$ financial statements will decline. The Company does not hold any derivative or other financial instruments that expose to substantial market risk. (e) Economic and political risks The Company's operations are conducted in the PRC. Accordingly, the Company's business, financial condition and results of operations may be influenced by the political, economic and legal environment in the PRC, and by the general state of the PRC economy. The Company's operations in the PRC are subject to special considerations and significant risks not typically associated with companies in North America and Western Europe. These include risks associated with, among others, the political, economic and legal environment and foreign currency exchange. The Company's results may be adversely affected by changes in the political and social conditions in the PRC, and by changes in governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversion, remittances abroad, and rates and methods of taxation. (f) Mining industry risks The Company's mining operations are subject to extensive national and local governmental regulations in China, which regulations may be revised or expanded at any time. Generally, compliance with these regulations requires the Company to obtain permits issued by government regulatory agencies. Certain permits require periodic renewal or review of their conditions. The Company cannot predict whether it will be able to obtain or renew such permits or whether material changes in permit conditions will be imposed. The inability to obtain or renew permits or the imposition of additional conditions could have a material adverse effect on the Company's ability to develop and operate its mines. (g) Risk on changing price in gold At present, the price of gold in the PRC is generally in line with the price of gold in the international market. There are many factors influencing the price of gold in the international market, including the international economic situation (in particular the economic situation in the US), petroleum prices, fluctuations in the exchange rates of the US$, fluctuations in the stock and other financial investment markets and various political, military, social and economic contingencies. These factors are beyond the control of the Company. Changes in the prices of the gold in the PRC and in the exchange rate of Renminbi as a result of these may adversely affect the operating results of the Company. Under the relevant PRC laws and regulations, hedging activities presently are not permitted in gold tracing in the PRC market. The Company has not been involved in hedging transactions or any alternative measures to manager the potential price risk. |
NOTE 10 - COMMITMENTS AND CONTI
NOTE 10 - COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2016 | |
Current: | |
10. COMMITMENTS AND CONTINGENCIES | NOTE 10 COMMITMENTS AND CONTINGENCIES The Company is committed under several non-cancelable operating leases for office premises and mining rights with the terms ranging from 1 to 10 years, with fixed monthly rentals or scheduled payments. Total rent expenses (excluding amortization of prepaid mining rights) for the three months ended March 31, 2016 and 2015 was $42,205 and $27,966, respectively. As of March 31, 2016, the Company has the aggregate future minimum rental payments of $6,498,240 due under these non-cancelable operating leases in the next twelve months: Operating lease commitments Office premises Mine operating rights Total Period ending March 31, 2017 $ 120,146 $ 6,498,240 $ 6,618,386 2018 99,056 - 99,056 Total: $ 219,202 $ 6,498,240 $ 6,717,442 |
NOTE 11 - SUBSEQUENT EVENTS
NOTE 11 - SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2016 | |
Subsequent Events [Abstract] | |
11. SUBSEQUENT EVENTS | NOTE 11 SUBSEQUENT EVENTS The company evaluated subsequent events through the date the financial statements were issued and filed with this Form10-Q. There were no subsequent events that required recognition or disclosure. |
NOTE 4 - SUMMARY OF SIGNIFICA18
NOTE 4 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2016 | |
Note 4 - Summary Of Significant Accounting Policies Policies | |
Exploration Stage Company | l Exploration stage company Despite the fact that the Company commenced its production in 2009, it is still considered an exploration stage company under the criteria set forth by the Securities and Exchange Commission (SEC) since it has not yet demonstrated the existence of proven or probable reserves, defined by SEC Industry Guide 7 |
Proven or Propable Reserves | l Proven or probable reserves The definition of proven or probable reserves is set forth in SEC Industry Guide 7. |
Use of Estimates | l Use of estimates In preparing these condensed consolidated financial statements, management makes estimates and assumptions that affect the reported amounts of assets and liabilities in the balance sheet and revenues and expenses during the periods reported. Actual results may differ from these estimates. |
Basis of Consolidation | l Basis of consolidation The condensed consolidated financial statements include the financial statements of CHSO, its subsidiaries and VIEs. All inter-company balances and transactions between the Company and its subsidiaries and VIEs have been eliminated upon consolidation. The Company has adopted ASC Topic 810-10-5-8, Variable Interest Entities |
Variable Interest Entity | l Variable interest entity The Company's subsidiary, SBCL entered into a series of amended agreements ("VIE agreements") amongst SSIC, JinGuan, DYM and the individual owners of SSIC, JinGuan and DYM and details of the VIE agreements are as follows: 1. Exclusive Technical Service and Business Consulting Agreement, SBCL has the exclusive right to provide to SSIC, JinGuan and DYM consulting services, including operational management, human resources management, research and development of the technologies related to the operations of SSIC, JinGuan and DYM. SSIC, JinGuan and DYM pays to SBCL annually consulting service fees in an amount equals to all of their revenue for such year. These agreements run for 10 year terms and are subject to automatic renewal for an additional 10 year term provided that no objection is made by both parties on the renewal.; 2. Exclusive Option Agreement, SBCL has the option to purchase SSIC, JinGuan and DYM all assets and ownership at any time.; 3. Equity Pledge Agreement, SSIC, JinGuan and DYM agree to pledge their legal interest to SBCL as a security for the obligations under the Exclusive Technical Service and Business Consulting Agreement; 4. Proxy Agreement, SSIC, JinGuan and DYM irrevocably grant and entrust SBCL the right to exercise its voting and other stockholders right. 5. Operating Agreement, SBCL agrees to participate in the operations of SSIC, JinGuan and DYM in different aspects. With the above agreements, SBCL demonstrates its ability to control SSIC and JinGuan as the primary beneficiaries and the operating results of the VIEs was included in the condensed consolidated financial statements for the three months ended March 31, 2016 and 2015. |
Cash and Cash Equivalents | l Cash and cash equivalents Cash and cash equivalents are carried at cost and represent cash on hand, demand deposits placed with banks or other financial institutions and all highly liquid investments with an original maturity of three months or less as of the purchase date of such investments. |
Mining Rights, Exploration and Development Costs | l Mining rights, exploration and development costs Costs of mining rights are capitalized upon acquisition. Subsequent exploration and development costs are expensed as incurred until such time as a feasibility study has been completed which establishes, in compliance with SEC Industry Guide 7 |
Prepaid Mining Rights | l Prepaid mining rights Prepaid mining rights represent certain amount of lease prepayment made for the operation of the mining license of Dayuan Gold Mine and are being amortized using a straight-line basis over its scheduled lease term. The rent expense on prepaid mining rights for the three months ended March 31, 2016 and 2015 was $504,628 and $537,827, respectively. As of March 31, 2016, the estimated annual amortization of the prepaid mining rights for the next five years and thereafter is as follows: Period ending March 31: 2017 1,535,383 2018 1,880,722 2019 31,017 2020 31,017 2021 31,017 Thereafter 54,284 Total: $ 3,563,440 |
Property, Plant and Equipment | l Property, plant and equipment Property, plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses, if any. Depreciation is calculated on the straight-line basis over the following expected useful lives from the date on which they become fully operational and after taking into account their estimated residual values: Expected useful life Residual value Plant and machinery 5-10 years 5% Motor vehicles 5 years 5% Office equipment 3-5 years 5% Expenditure for repairs and maintenance is expensed as incurred. When assets have retired or sold, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in the results of operations. Depreciation expense for the three months ended March 31, 2016 and 2015 were $115,213 and $128,585, respectively. |
Construction in Progress | l Construction in progress Construction in progress is stated at cost, which includes the costs of self-constructed assets, including mine development assets during the construction phase. Indirect overhead costs are not included in the cost of self-constructed assets. Construction in progress is not depreciated until such time as the assets are completed and put into operational use. No capitalized interest is incurred during the period of construction. |
Impairment of Long-Lived Assets | l Impairment of long-lived assets In accordance with the provisions of ASC Topic 360-10-5, Impairment or Disposal of Long-Lived Assets Numerous factors including, but not limited to, such things as unexpected grade changes, gold recovery problems, shortages of equipment and consumables, equipment failures, and collapse of pit walls, could impact our ability to achieve forecasted production schedules from proven and probable reserves. Additionally, commodity prices, capital expenditure requirements and reclamation costs could differ from the assumptions used in the cash flow models used to assess impairment. The ability to achieve the estimated quantities of recoverable minerals from exploration stage mineral interests involves further risks in addition to those factors applicable to mineral interests where proven and probable reserves have been identified, due to the lower level of confidence that the identified mineralized material can ultimately be mined economically. There has been no impairment charge for the periods presented. |
Revenue Recognition | l Revenue recognition In accordance with the ASC Topic 605, Revenue Recognition (a) Product sales The Company derives revenues from the sales of non-refined gold concentrate to smelters, whereas the smelter usually takes 6 days for the production from non-refined gold concentrate to gold bullion. The Company generally recognizes its revenues, net of value-added taxes ("VAT") at the time of gold bullion is produced by the smelter and its selling price is determined by the market value of gold bullion quoted by the Shanghai Gold Exchange. The Company is subject to VAT which is levied on the standard gold products at the standard rate of 17% on the invoiced value of sales. The Companys VIE, XinGuan is granted with a preferential tax treatment under the Chinese tax law of the Notice from Ministry of Finance and State Tax Bureau in Relation to Exemption of Value Added Tax on Gold Production Notice regarding issues on Tax Policy on Gold Transaction (b) Interest income Interest income is recognized on a time apportionment basis, taking into account the principal amounts outstanding and the interest rates applicable. |
Comprehensive Income | l Comprehensive income ASC Topic 220, Comprehensive Income, |
Income Taxes | l Income taxes The Company adopts ASC Topic 740, Income Taxes For the three months ended March 31, 2016 and 2015, the Company did not have any interest and penalties associated with tax positions. As of March 31, 2016, the Company did not have any significant unrecognized uncertain tax positions. The Company conducts major businesses in the PRC and is subject to tax in this jurisdiction. As a result of its business activities, the Company files tax returns that are subject to examination by the foreign tax authority. |
Net Loss Per Share | l Net loss per share The Company calculates net loss per share in accordance with ASC Topic 260, Earnings per Share. |
Foreign Currencies Translation | l Foreign currencies translation Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the statement of operations. The reporting currency of the Company is the United States Dollars ("US$"). The Company's subsidiary in the PRC maintain its books and records in its local currency, Renminbi Yuan ("RMB"), which is functional currency as being the primary currency of the economic environment in which the entity operates. In general, for consolidation purposes, assets and liabilities of its subsidiaries and VIEs whose functional currency is not US$ are translated into US$, in accordance with ASC Topic 830-30, Translation of Financial Statement Translation of amounts from RMB into US$1 has been made at the following exchange rates for the respective period: March 31, 2016 March 31, 2015 Period-end RMB:US$1 exchange rate 6.44790 6.1091 Period average RMB:US$1 exchange rate 6.53947 6.1358 |
Related Parties | l Related parties Parties, which can be a corporation or individual, are considered to be related if the Company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operational decisions. Companies are also considered to be related if they are subject to common control or common significant influence. |
Segment Reporting | l Segment reporting ASC Topic 280, Segment Reporting |
Fair Value of Financial Instruments | l Fair value of financial instruments The carrying value of the Companys financial instruments include cash, accounts receivable, amounts due from (to) related parties, deposits and prepayments, accounts payable, amount due to a related party, income tax payable, accrued liabilities and other payable. Fair values were assumed to approximate carrying values for these financial instruments because they are short term in nature and their carrying amounts approximate fair values. The carrying value of the Companys loans and note payable approximated its fair value based on the current market prices or interest rates for similar debt instruments. The Company also follows the guidance of ASC Topic 820-10, Fair Value Measurements and Disclosures Level 1 Level 2 Level 3 Fair value estimates are made at a specific point in time based on relevant market information about the financial instrument. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates. |
Recent Accounting Pronouncements | l Recent accounting pronouncements The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and does not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations. |
NOTE 2 - ORGANIZATION AND BAC19
NOTE 2 - ORGANIZATION AND BACKGROUND (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Note 2 - Organization And Background Tables | |
Company's subsidiaries and VIEs | Name Place of incorporation and kind of legal entity Principal activities and place of operation Particulars of issued/ registered share capital Effective interest Held Bei Sheng Limited (BSL) British Virgin Islands, a limited liability company Investment holding in GWIL and provision of mining technical advice 50,000 issued shares of US$1 each 100% Golden Wide International Limited (GWIL) Hong Kong, a limited liability company 100%-investment holding in SBCL 10,000 issued shares of HK$1 each 100% Shoujin Business Consulting (Shenzhen) Limited (SBCL) The PRC, a limited liability company Provision of consulting service in the PRC RMB100,000 100% Shenzhen Shouguan Investment Co., Ltd (SSIC) # The PRC, a limited liability company 99%-investment holding in JinGuan RMB18,100,000 N/A Yantai Jinguan Investment Limited (JinGuan) # The PRC, a limited liability company 100%-investment holding in XinGuan RMB5,000,000 N/A DaxinganlingYiguanyuan Mining Investment Company Limited (DYM) # The PRC, a limited liability company Mine exploration in Daxinganling RMB4,010,000 N/A |
NOTE 4 - SUMMARY OF SIGNIFICA20
NOTE 4 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Note 4 - Summary Of Significant Accounting Policies Tables | |
Estimated annual amortization of the prepaid mining rights | Period ending March 31: 2017 1,535,383 2018 1,880,722 2019 31,017 2020 31,017 2021 31,017 Thereafter 54,284 Total: $ 3,563,440 |
Property, plant and equipment expected useful life | Expected useful life Residual value Plant and machinery 5-10 years 5% Motor vehicles 5 years 5% Office equipment 3-5 years 5% |
Foreign currencies translation RMB into USD | March 31, 2016 March 31, 2015 Period-end RMB:US$1 exchange rate 6.44790 6.1091 Period average RMB:US$1 exchange rate 6.53947 6.1358 |
NOTE 6 - LOANS PAYABLE, UNSEC21
NOTE 6 - LOANS PAYABLE, UNSECURED (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Non-deductible items | |
Short and Long Term Loans Payable To Third parties | March 31, 2016 December 31, 2015 Loans payable to certain individuals and financial institution in the PRC, unsecured: Equivalent to RMB3,000,000 (2015: RMB 3,000,000) with interest rate at 2.7% per annum, payable at its maturity, due May 7, 2016 $ 465,268 $ 462,200 Equivalent to RMB7,400,000 (2015: RMB 7,400,000) with interest rate at 2.7% per annum, payable at its maturity, due May 7, 2016 1,147,660 1,140,093 Equivalent to RMB5,800,000 (2015: RMB 8,800,000) with interest rate free, payable at its maturity, due June 2016 899,517 1,355,786 Equivalent to RMB2,000,000 (2015: RMB 2,000,000) with interest rate free, payable at its maturity, due April 13, 2016 310,179 308,133 Equivalent to RMB3,740,000 (2015: RMB 3,740,000) with interest rate at the bank of China Benchmark Lending Rate, payable at its maturity, due July 17, 2016 556,770 576,209 Equivalent to RMB5,000,000 with interest rate at the bank of China Benchmark Lending Rate, payable at its maturity, due April 26, 2016 775,447 770,333 Equivalent to RMB60,892 (2015: 887,305) with effective interest rate at 8.97% per annum, payable with monthly principal and interest payments, due February 28, 2017 9,444 136,704 Equivalent to RMB378,800 (2015:552,324) with effective interest rate at 1.75% per month, payable with monthly principal and interest payments, due April 10, 2018 58,748 85,094 Equivalent to RMB29,000,000 with effective interest rate at 4.79% per annum, payable with monthly principal and interest payments, due December 29, 2016 4,497,588 - Equivalent to RMB6,975,701, interest free, payable at its maturity due June 30, 2016 - 1,074,723 Equivalent to RMB640,000, interest free, payable at its maturity, due March 7, 2018 99,256 98,602 Equivalent to RMB324,709, interest free, payable at its maturity, due March 7, 2017 50,359 50,028 Equivalent to RMB1,486,000, interest free, payable at its maturity, due March 11, 2017 230,463 - Equivalent to RMB6,000,000, interest free, payable at its maturity, due July 17, 2016 930,536 - Total current and long-term liabilities 10,031,235 6,057,905 Less: long-term portion (132,963) (69,542) Total current liabilities $ 9,898,272 $ 5,988,363 |
NOTE 8 - INCOME TAXES (Tables)
NOTE 8 - INCOME TAXES (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Note 8 - Income Taxes Tables | |
Foreign Components Of Loss Before Income Taxes | Three months ended March 31, 2016 2015 Tax jurisdictions from: Local $ - $ - Foreign (1,009,234) (1,035,731) Loss before income taxes $ (1,009,234) $ (1,035,731) |
The Provision For Income Taxes | Three months ended March 31, 2016 2015 Current: Local $ - $ - Foreign, representing by: Hong Kong - - The PRC - - Deferred: Local - - Foreign - - Income tax expense $ - $ - |
Reconciliation Of Income Tax Rate To The Effective Income Tax Rate | Three months ended March 31, 2016 2015 Loss before income taxes $ (1,008,459) $ (1,030,615) Statutory income tax rate 25% 25% Income tax expense at the statutory rate (252,114) (257,654) Net operating loss not recognized as deferred tax asset (252,114) 91,051 Non-deductible items 504,228 166,603 Income tax expense $ - $ - |
NOTE 10 - COMMITMENTS AND CON23
NOTE 10 - COMMITMENTS AND CONTINGENCIES (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Note 10 - Commitments And Contingencies Tables | |
Future Minimum Rental Payments Due | Operating lease commitments Office premises Mine operating rights Total Period ending March 31, 2017 $ 120,146 $ 6,498,240 $ 6,618,386 2018 99,056 - 99,056 Total: $ 219,202 $ 6,498,240 $ 6,717,442 |
NOTE 2 - ORGANIZATION AND BAC24
NOTE 2 - ORGANIZATION AND BACKGROUND - Details Of The Company Subsidiaries And VIE (Details) | Dec. 31, 2015 |
Note 2 - Organization And Background - Details Of Company Subsidiaries And Vie Details | |
Effective interest of Bei Sheng Limited ("BSL") British Virgin Islands, a limited liability company Investment holding in GWIL and provision of mining technical advice 50,000 issued shares of US$1 each | 100 |
Effective interest of Golden Wide International Limited ("GWIL") Hong Kong, a limited liability company 100%-investment holding in SBCL 10,000 issued shares of HK$1 each | 100 |
Effective interest of Shoujin Business Consulting (Shenzhen) Limited ("SBCL") The PRC, a limited liability company Provision of consulting service in the PRC RMB100,000 | 100 |
Effective interest of Shenzhen Shouguan Investment Co., Ltd ("SSIC") The PRC, a limited liability company 99%-investment holding in JinGuan and DYM, respectively, RMB10,180,000 | |
Effective interest of Yantai Jinguan Investment Limited ("JinGuan") The PRC, a limited liability company 100%-investment holding in XinGuan RMB5,000,000 | |
Effective interest of Daxinganling Yiguanyuan Mining Investment Company Limited ("DYM") The PRC, a limited liability company Mine exploration in Daxinganling RMB4,010,000 |
NOTE 3 - GOING CONCERN UNCERT25
NOTE 3 - GOING CONCERN UNCERTAINTIES - Loss And Working Capital Deficit Information (Details Narrative) - USD ($) | Mar. 31, 2016 | Dec. 31, 2015 |
Income (Loss) from Continuing Operations, Including Portion Attributable to Noncontrolling Interest [Abstract] | ||
Accumulated deficits | $ (12,676,358) | $ (11,667,124) |
Working capital deficit | $ 6,526,923 |
NOTE 4 - SUMMARY OF SIGNIFICA26
NOTE 4 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Estimated Annual Amortization Of The Prepaid Mining Rights (Details) - USD ($) | 12 Months Ended | 24 Months Ended | 72 Months Ended | ||||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2017 | Sep. 30, 2022 | Mar. 31, 2022 | Mar. 31, 2022 | |
Summary Of Significant Accounting Policies Resource Compensation Fees Details | |||||||
Estimated Annual Ammortization of prepaid mining rights | $ 31,017 | $ 31,017 | $ 1,880,722 | $ 1,535,383 | $ 54,284 | $ 31,017 | $ 3,563,440 |
NOTE 4 - SUMMARY OF SIGNIFICA27
NOTE 4 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Property, Plant, and Equipment Estimated Useful Life (Details) | 3 Months Ended |
Mar. 31, 2016 | |
Estimated Useful Life | |
Plant and machinery, min | 5 years |
Plant and machinery, max | 10 years |
Motor vehicles | 5 years |
Office equipment, min | 3 years |
Office equipment, max | 5 years |
Residual Value | |
Plant and machinery | 5.00% |
Motor vehicles | 5.00% |
Office equipment | 5.00% |
NOTE 4 - SUMMARY OF SIGNIFICA28
NOTE 4 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Foreign Currencies Translation (Details) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Summary Of Significant Accounting Policies Resource Compensation Fees Details | ||
Year-end RMB:US$1 exchange rate | 6.44790 | 6.1091 |
Annual average RMB:US$1 exchange rate | 6.53947 | 6.1358 |
NOTE 4 - SUMMARY OF SIGNIFICA29
NOTE 4 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Accounting Policies [Abstract] | ||
Depreciation expense | $ 115,213 | $ 128,585 |
NOTE 6 - LOANS PAYABLE, UNSEC30
NOTE 6 - LOANS PAYABLE, UNSECURED (Details) - USD ($) | Mar. 31, 2016 | Dec. 31, 2015 |
Total current and long-term liabilities | $ 10,031,235 | $ 6,057,905 |
Less: long-term portion | (132,963) | (69,542) |
Total current liabilities | 9,898,272 | 5,988,363 |
Equivalent to RMB3,000,000 (2014: RMB4,500,000) with interest rate at 2.7% per annum, payable at its maturity, due May 7, 2016 | ||
Loan payable | 465,268 | 462,200 |
Equivalent to RMB7,400,000 (2014: RMB 7,400,000) with interest rate at 2.7% per annum, payable at its maturity, due May 7, 2016 | ||
Loan payable | 1,147,660 | 1,140,093 |
Equivalent to RMB8,800,000 with interest rate free, payable at its maturity, due June 2016 | ||
Loan payable | 899,517 | 1,355,786 |
Equivalent to RMB2,000,000 with interest rate free, payable at its maturity, due December 31, 2015 | ||
Loan payable | 310,179 | 308,133 |
Equivalent to RMB5,500,000 with interest rate at the bank of China Benchmark Lending Rate, payable at its maturity, due July 17, 2016 | ||
Loan payable | 556,770 | 576,209 |
Equivalent to RMB5,000,000, with interest rate at the bank of China Benchmark Lending Rate, payable at its maturity, due April 26, 2015 | ||
Loan payable | 775,447 | 770,333 |
Equivalent to RMB1,054,850 (2014: RMB501,999) with effective interest rate at 8.97% per annum, payable with monthly principal and interest payments, due February 28, 2017 | ||
Loan payable | 9,444 | 136,704 |
Equivalent to RMB436,443 with effective interest rate at 1.75% per month, payable with monthly principal and interest payments, due April 10, 2018 | ||
Loan payable | 58,748 | 85,094 |
Equivalent to RMB29,000,000 with effective interest rate at 4.79% per annum, payable with monthly principal and interest payments, due December 29, 2016 | ||
Loan payable | 4,497,588 | 0 |
Equivalent to RMB6,975,701, interest free, payable at its maturity, due June 30, 2016 | ||
Loan payable | 0 | 1,074,723 |
Equivalent to RMB640,000 with interest free, payable at its maturity, due March 7, 2016 | ||
Loan payable | 99,256 | 98,602 |
Equivalent to RMB324,709 with interest free, payable at its maturity, due March 7, 2016 | ||
Loan payable | 50,359 | 50,028 |
Equivalent to RMB1,486,000, interest free, payable at its maturity, due March 11, 2017 | ||
Loan payable | 230,463 | 0 |
Equivalent to RMB6,000,000, interest free, payable at its maturity, due July 17, 2016 | ||
Loan payable | $ 930,536 | $ 0 |
NOTE 7 - NOTE PAYABLE, RELATE31
NOTE 7 - NOTE PAYABLE, RELATED PARTY (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Mining assets {1} | ||
Interest due on loan | $ 12,343 | $ 22,814 |
NOTE 8 - INCOME TAXES - Foreign
NOTE 8 - INCOME TAXES - Foreign Components Of Loss Before Income Taxes (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Tax jurisdictions from: | ||
- Local | $ 0 | $ 0 |
- Foreign | (1,009,234) | (1,035,731) |
Loss before income taxes | $ (1,009,234) | $ (1,035,731) |
NOTE 8 - INCOME TAXES - The Pro
NOTE 8 - INCOME TAXES - The Provision For Income Taxes (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Current: | ||
- Local | $ 0 | $ 0 |
- Foreign, representing by: | ||
The PRC | 0 | 0 |
Deferred | ||
- Local | 0 | 0 |
- Foreign | 0 | 0 |
Income tax expense | $ 0 | $ 0 |
NOTE 8 - INCOME TAXES - Reconci
NOTE 8 - INCOME TAXES - Reconciliation Of the PRC Income Tax Rate To The Effective Income Tax Rate (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
The PRC statutory tax reconciliation | ||
Loss before income taxes | $ (1,008,459) | $ (1,030,615) |
Statutory income tax rate | 25.00% | 25.00% |
Income tax expense at the statutory tax rate | $ (252,114) | $ (257,654) |
Net operating loss not recognized as deferred tax asset | (252,114) | 91,051 |
Non-deductible items | 504,228 | 166,603 |
Income tax expense | $ 0 | $ 0 |
NOTE 8 - INCOME TAXES (Details
NOTE 8 - INCOME TAXES (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
– Local Deferred | ||
Hong Kong statutory tax rate | 16.50% | |
Operating loss of Golden Wide | $ 0 | $ 168 |
Aggretate net operating loss carryforwards | 1,571,307 | |
Deferred tax assets | $ 1,571,307 |
NOTE 9 - CONCENTRATIONS OF RI36
NOTE 9 - CONCENTRATIONS OF RISK - (Details Narrative) | 3 Months Ended |
Mar. 31, 2016USD ($) | |
Vendor Total | |
Vendor purchases | $ 0 |
Percent of vendor purchases | 85.00% |
Accounts payable balance due to vendor | $ 158,351 |
Customer Total | |
Revenue | $ 0 |
NOTE 10 - COMMITMENTS AND CON37
NOTE 10 - COMMITMENTS AND CONTINGENCIES - Information Of Non Cancelable Operating Leases (Details) - USD ($) | 12 Months Ended | 24 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2018 | |
Aggregate future minimum rental payments due under these non-cancelable operating leases | |||
Office premises | $ 99,056 | $ 120,146 | $ 219,202 |
Mine operating rights | 0 | 6,498,240 | 6,498,240 |
Total operating lease commitments | $ 99,056 | $ 6,618,386 | $ 6,717,442 |
NOTE 10 - COMMITMENTS AND CON38
NOTE 10 - COMMITMENTS AND CONTINGENCIES (Details Narrative) | 3 Months Ended | |
Mar. 31, 2016USD ($) | Mar. 31, 2015USD ($) | |
Deferred tax assets valuation allowance | ||
Minimum lease term of operating leases | 1 | |
Maximum lease term of operating leases | 10 | |
Total rent expenses excluding amortization of prepaid mining rights and office premises | $ 42,205 | $ 27,966 |