Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2018 | May 15, 2018 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Jiucaitong Group Ltd | |
Entity Central Index Key | 1,610,607 | |
Trading Symbol | JCTG | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q1 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 9,110,000 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 |
Current assets | ||
Cash and cash equivalents | $ 2,405,949 | $ 1,941,150 |
Restricted cash | 190,837 | 184,437 |
Accounts receivable | 21,010 | 522 |
Other receivable | 84,104 | 19,327 |
Prepaid expenses | 32,298 | |
Advances to suppliers | 19,958 | 49,672 |
Due from related parties | 172,156 | 75,301 |
Total current assets | 2,894,014 | 2,302,707 |
Non-current assets | ||
Security Deposit | 75,170 | 72,649 |
Property, plant and equipment, net | 27,318 | 35,333 |
Total non-current assets | 102,488 | 107,982 |
Total assets | 2,996,502 | 2,410,689 |
Current liabilities | ||
Accrued liabilities | 19,271 | |
Other payable | 279,802 | 133,093 |
Due to related parties | 16,551 | 23,682 |
Advance from customers | 249,847 | 114,191 |
VAT payable | 104,881 | 195,308 |
Total current liabilities | 670,352 | 466,274 |
Total liabilities | 670,352 | 466,274 |
Commitments and contingencies | ||
STOCKHOLDERS' EQUITY | ||
Common Stock, $0.0001 par value, 75,000,000 shares authorized; 9,110,000 and 9,110,000 shares issued and outstanding as of March 31, 2018 and December 31, 2017, respectively | 911 | 911 |
Additional paid-in capital | 4,358,269 | 4,358,269 |
Accumulated deficit | (904,791) | (1,214,945) |
Accumulated other comprehensive loss | (1,128,239) | (1,199,820) |
Total stockholders' equity | 2,326,150 | 1,944,415 |
Total liabilities and stockholders' equity | $ 2,996,502 | $ 2,410,689 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, authorized | 75,000,000 | 75,000,000 |
Common stock, issued | 9,110,000 | 9,110,000 |
Common stock, outstanding | 9,110,000 | 9,110,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Income Statement [Abstract] | ||
Revenue | $ 772,014 | $ 295,593 |
Operating expenses: | ||
Selling expenses | 31,605 | 30,750 |
General and administrative expenses | 407,134 | 266,934 |
Total operating expenses | 438,739 | 297,684 |
Income (loss) from operations | 333,275 | (2,091) |
Other income (expense): | ||
Other income | 16,639 | 21,499 |
Other expense | (54,059) | (1,628) |
Gain from extinguishment of liability | 14,299 | |
Total other income (expense), net | (23,121) | 19,871 |
Income before provision for income taxes | 310,154 | 17,780 |
Provision for income tax expense | ||
Net income | 310,154 | 17,780 |
Comprehensive Income: | ||
Net income | 310,154 | 17,780 |
Foreign currency translation adjustment | 71,581 | 133,780 |
Comprehensive income | $ 381,735 | $ 151,560 |
Earnings per common share - basic and diluted | $ 0.03 | $ 0 |
Weighted average number of common shares outstanding - basic and diluted | 9,110,000 | 8,000,000 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Cash flows from operating activities: | ||
Net income | $ 310,154 | $ 17,780 |
Adjustments to reconcile net income to net cash used in operating activities: | ||
Depreciation expenses | 9,120 | 13,910 |
Gain from extinguishment of liability | (14,299) | |
Changes in operating assets and liabilities: | ||
Accounts receivable | (20,202) | |
Other receivables | (63,268) | 1,374 |
Prepaid expense | 32,982 | |
Advances to suppliers | 31,027 | |
Security Deposit | ||
Due from related parties | (93,011) | (339,256) |
Due to related parties | 3,660 | |
Advance from customers | 129,971 | (22,562) |
Accrued liabilities | 19,019 | (117) |
Other payables | 154,532 | 24,880 |
VAT payable | (95,933) | 17,870 |
Net cash provided by (used in) operating activities | 400,092 | (282,461) |
Cash flows from investing activities: | ||
Working capital advances to related parties | (9,165,199) | |
Repayments from related parties | 6,407,007 | |
Net cash used in investing activities | (2,758,192) | |
Cash flows from financing activities: | ||
Working capital advances from related parties | 3,546,849 | |
Repayments | (7,848) | |
Net cash (used in) provided by financing activities | (7,848) | 3,546,849 |
Effect of exchange rate change on cash | 72,555 | (412) |
Net change in cash and cash equivalents | 464,799 | 505,784 |
Cash and cash equivalents - beginning of period | 1,941,150 | 12,924 |
Cash and cash equivalents - end of period | 2,405,949 | 518,708 |
Supplemental disclosure of cash flow information | ||
Interest paid | ||
Income tax paid |
Nature of Operations
Nature of Operations | 3 Months Ended |
Mar. 31, 2018 | |
Nature of Operations [Abstract] | |
NATURE OF OPERATIONS | NOTE 1 - NATURE OF OPERATIONS Jiucaitong Group Limited and Subsidiaries (“Jiucaitong” or the “Company”), a Nevada Corporation (formerly Spirit International, Inc.), was incorporated on March 10, 2014. Through Beijing Jiucheng Asset Management Co., Ltd. (“Beijing Jiucheng”), the Company operates its business through an electronic online financial platform, www.9caitong.com (“website”). The Company generates revenue from the services that facilitate matching personal loan lender with individual and small and medium sized enterprises (“SME”) borrowers in China. Beijing Jiucheng was incorporated in Beijing, China on January 13, 2012 under the law of People’s Republic of China (“PRC” or “China”). Reverse Merger On August 1, 2017, Beijing Jiucheng IT Consulting Enterprise Co. Ltd. (“Jiucheng Consulting”), a wholly foreign-owned enterprise of I JIU JIU Limited (“I JIU JIU”), obtained the controlling interest of Beijing Jiucheng through a series of contractual arrangements including Equity Pledge Agreement, Exclusive Technical Consultancy and Services Agreement, Exclusive Call Option Agreement, Shareholder Proxy Agreement, and Operating Agreement (the “VIE Agreements”) wherein Beijing Jiucheng is considered as a variable interest entity (“VIE”). On November 10, 2017, Jiucaitong, I JIU JIU Limited (“I JIU JIU”), the holding company of Ruixiang Technology Group,Ltd. (“Rui Xiang”), and the shareholders of I JIU JIU entered into the Share Exchange Agreement, which closed on the same date. Pursuant to the terms of the Share Exchange Agreement, Jiucaitong exchanged 8,000,000 shares of their common stock for all of the outstanding capital stock of I JIU JIU with the result that I JIU JIU became a wholly owned subsidiary of Jiucaitong. Pursuant to the Merger, all of the issued and outstanding shares of I JIU JIU common stock were converted, at an exchange ratio of 160-for-1, into an aggregate of 8,000,000 shares of Spirit International Inc. common stock and I JIU JIU became a wholly owned subsidiary of Spirit International Inc. The holders of Spirit International Inc’s common stock as of immediately prior to the Merger held an aggregate of 5,110,000 shares and in connection with the Share Exchange Agreement, the Company’s majority shareholder, Kimho Consultants Company Limited, (“Kimho” or the “Majority Shareholder”) entered into a share cancellation agreement with I JIU JIU’s stockholders whereby Kimho, owning an aggregate of 4,000,000 shares of the Company’s Common Stock agreed to cancel all its 4,000,000 shares of Common Stock in exchange of $440,000 paid by I JIU JIU’s stockholders (“Share Cancellation”). The accompanying financial statements share and per share information has been retroactively adjusted to reflect the exchange ratio in the Merger. Subsequent to the Merger, Spirit International Inc’s name was changed from “Spirit International, Inc.” to “Jiucaitong Group Limited.”. Under generally accepted accounting principles in the United States, (“U.S. GAAP”) because I JIU JIU’s former stockholders received the greater portion of the voting rights in the combined entity and I JIU JIU’s senior management represents all of the senior management of the combined entity, the Merger was accounted for as a recapitalization effected by a share exchange, wherein I JIU JIU is considered the acquirer for accounting and financial reporting purposes. The assets and liabilities of I JIU JIU, its wholly-owned subsidiaries and Beijing Jiucheng have been brought forward at their book value and no goodwill has been recognized. Accordingly, the assets and liabilities and the historical operations that are reflected in the Company’s consolidated financial statements are those of I JIU JIU, its wholly-owned subsidiaries and Beijing Jiucheng and are recorded at their historical cost basis. Unless otherwise indicated or the context otherwise requires, references to “the Company” refer to Jiucaitong Group Limited and Subsidiaries. Disclosures relating to the pre-merger business of I JIU JIU, unless noted as being the business of Spirit International, Inc., prior to the Merger, pertain to the business of I JIU JIU prior to the Merger. |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2018 | |
Basis of Presentation and Summary of Significant Accounting Policies [Abstract] | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 - BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The unaudited condensed 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 financial statements are expressed in U.S. dollars. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three months ended March 31, 2018 are not necessarily indicative of the results that may be expected for the year ending December 31, 2018. The unaudited condensed consolidated financial statements should be read in conjunction with the audited financial statements as of and for the year ended December 31, 2017 and footnotes thereto included in the same document. The condensed consolidated balance sheet as of December 31, 2017 contained herein has been derived from the audited financial statements as of December 31, 2017 but does not include all disclosures required by the generally accepted accounting principles in the U.S. (“U.S. GAAP”). Basis of Consolidation The consolidated financial statements include the financial statements of the Company, its wholly-owned subsidiaries, I JIU JIU, Ruixiang, Jiucheng Consulting and its VIE, Beijing Jiucheng. All inter-company transactions and balances have been eliminated upon consolidation. Use of Estimates and Assumptions The preparation of 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. Significant estimates as of and during the periods ended March 31, 2018 and December 31, 2017 include the allowance for doubtful accounts, the useful life of property and equipment, assumptions used in assessing impairment of long-term assets, valuation of deferred tax assets and accruals for taxes due. Financial Instrument The carrying amount reported in the consolidated balance sheet for cash, accounts receivable, other receivables, accrued liabilities and other payables approximate fair value because of the immediate or short-term maturity of these financial instruments. 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. The Company maintains with various financial institutions in the PRC. At March 31, 2018 and December 31, 2017, cash balances held in PRC banks are uninsured. The Company has not experienced any losses in bank accounts and believes it is not exposed to any risks on its cash in bank accounts. Restricted Cash Cash that is deposited in the bank but restricted for a specific purpose and therefore not available for immediate and general use by the Company is classified as restricted cash, which is presented separately from cash and cash equivalents on the consolidated balance sheets. The deposited balance is included in the Company’s bank account for guarantee of certain business purpose under an agreement until being used for the designated purpose or withdrawn due to expiration of the guarantee. As of March 31, 2018 and December 31, 2017, the Company had a restricted cash balance of $190,837 and $184,437, respectively. 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 improvements 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. Estimated useful lives are as follows, taking into account the assets’ estimated residual value: Classification Estimated useful life Computer and office equipment 3 years Furniture 3 years Vehicles 3 years Advances from Customers Advances from customers at March 31, 2018 and December 31, 2017 amounted to $249,847 and $114,191, respectively, and consist of prepayments from customers for services that have not been performed. The Company will recognize the deposits as revenue when the services have been performed in accordance with the Company’s revenue recognition policy. Earnings per Share Basic earnings per share is computed by dividing net income by the weighted-average number of common shares outstanding during the period. Diluted earnings (loss) per share is computed by dividing net income by the weighted-average number of common shares and dilutive potential common shares outstanding during the period. For the three months ended March 31, 2018 and 2017, respectively, there were no outstanding securities or other contracts to issue common stock, such as options, warrants or conversion rights, which would have a dilutive effect on earnings per share. Revenue Recognition The Company provides intermediary services to the personal loan borrowers and the financial products investors. The Company charges fees for the intermediary services to the personal loan borrowers. Prior to July 2017, the revenue process started when an individual who had financing needs submited the loan application to Beijing Hengjiu Investment Management Co., Ltd. (“Hengjiu”). Hengjiu, along with its sub-contractor, Zhongcheng Zhengxin (Beijing) Co., Ltd. (“Zhongcheng Zhengxin”), provided financial consulting services such as loan origination criteria checkup, risk assessment, and assessment/evaluation of vehicle collateral. Hengjiu is a related party which was 75% owned by Jiuyuan Investment Co., Ltd. After the borrowers received the fund transfer, the Company then packaged the debt claims of Meng into corresponding financial products and placed in its physical stores or on its on-line platform for sale. Investors of those financial products were able to choose the financial products that met their needs. Meng transfered his debt upon signing the debt transfer agreement with the financial products investors. The services were originally provided in physical stores in Beijing, Baoding, Hebei province and Weihai, Shandong province. Since April 2016, Beijing Jiucheng started to move majority of the business to its financial advisory on-line platform, Jiucaitong (www.9caitong.com). As less labor was required, in June 2016, Beijing Jiucheng shut down the physical stores in Baoding and Weihai. Meng was responsible for making the loans, transferring the funds to the borrowers and collecting the service fees on behalf of all parties involved. Meng collected a portion of the service fees upfront and the rest on a monthly basis over the term of the loan from loan borrowers. The Company recognizes revenue, net of value-added taxes in the periods in which the related services were performed provided that persuasive evidence of an arrangement exists, the amount of the service fee is fixed in the loan agreements, and collectability is reasonably assured. The revenue was recognized when the loan agreements were executed and the funds were transferred to the loan borrowers, based on the predetermined service fee percentage of the total loan principal over the term of the loan. According to the service fee allocation agreement, Beijing Jiucheng was entitled to a service fee of 1% of the loan principal per month before July 1, 2016 and 1.5% per month effective July 1, 2016 and thereafter as Beijing Jiucheng increased the loan management and risk assessment services that were originally done by Beijing Hengjiu since May 2016. Since July 2017, the Company officially launched the bank depository system and is providing intermediary services for all registered users, including consultation, information and all kinds of delegation service. The Company started to charge the service fee from the amount borrowed by the borrower at the difference between the borrowers’ actual rate and the investors’ yield rate. Upon launching of the bank depository system, Meng no longer serves as the maker of the loan for the borrowers who use Jiucaitong on-line platform. The borrowers and investors enter the loan agreements directly with the online platform, Jiucaitong. Since December 2017, the online platform also provides loan intermediary services to the restaurant owners which operate the same as the rest of the borrowers except for that the restaurant owners use restaurants as collateral. Allowance for Doubtful Accounts Service fee receivable is recorded and carried at the original invoiced amount less an allowance for any potential uncollectible amounts. The Company makes estimates for the allowance for doubtful accounts based upon the assessment of various factors, including historical, experience, the age of the accounts receivable balances, credit quality of the loan borrowers, current economic conditions, and other factors that may affect the borrowers’ ability to pay. No allowance has been provided for at March 31, 2018 and December 31, 2017 as the service fees have been fully collected from the loan borrowers during the respective periods or subsequently. Advertising Expense The Company expenses advertising costs as they incurred. Total advertising expenses were $15,238 and $20,581 for the three months ended March 31, 2018 and 2017, respectively, and have been included as part of selling expenses in the accompanying statements of operations and comprehensive income. Value-added Taxes Pursuant to the PRC tax laws, in case of the financial services provided, generally the value added tax (“VAT”) rate is 3% of the gross sales for small scale VAT payer and 6% of the gross sales for general VAT payer. The accrued VAT is recorded as VAT payables in the consolidated financial statements. VAT is reported as a liability when incurred. Income Taxes The Company accounts for income taxes in accordance with U.S. GAAP for income taxes. Under the asset and liability method as required by this accounting standard, the recognition of deferred income tax liabilities and assets for the expected future tax consequences of temporary differences between the income tax basis and financial reporting basis of assets and liabilities. Provision for income taxes consists of taxes currently due plus deferred taxes. The charge for taxation is based on the results for the fiscal year as adjusted for items, which are non-assessable or disallowed. It is calculated using tax rates that have been enacted or substantively enacted by the balance sheet date. Deferred taxes are accounted for using the asset and liability method in respect of temporary differences arising from differences between the carrying amount of assets and liabilities in the consolidated financial statements and the corresponding tax basis used in the computation of assessable tax profit. Deferred tax liabilities are recognized for all future taxable temporary differences. Deferred tax assets are recognized to the extent that it is probable that taxable income will be available against which deductible temporary differences can be utilized. Deferred tax is calculated using tax rates that are expected to apply to the period when the asset is realized or the liability is settled. Deferred tax is charged or credited in the operations of statement, except when it is related to items credited or charged directly to equity. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Current income taxes are provided for in accordance with the laws of the relevant taxing authorities. On December 22, 2017, the Tax Cuts and Jobs Act (the “Tax Act”) was enacted by the U.S. government which included a wide range of tax reform affecting businesses including the corporate tax rates, international tax provisions, tax credits and deduction with majority of the tax provision effective after December 31, 2017. Certain activities conducted in foreign jurisdictions may result in the imposition of U.S. corporate income taxes on the Company when its subsidiaries, controlled foreign corporations (“CFCs”), generate income that is subject to Subpart F or GILTI under the U.S. Internal Revenue Code beginning after December 31, 2017. An uncertain 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 amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded. As of , the Company had no uncertain tax positions, and will continue to evaluate for uncertain positions in the future Foreign Currency Translation The functional currency of the Company’s operations in the PRC is the Chinese Yuan or Renminbi (“RMB”). The financial statements are translated to U.S. dollars using the period end rates of exchange for assets and liabilities, equity is translated at historical exchange rates, and average rates of exchange (for the period) are used for revenues and expenses and cash flows. As a result, amounts relating to assets and liabilities reported on the statements of cash flows may not necessarily agree with the changes in the corresponding balances on the balance sheets. Translation adjustments resulting from the process of translating the local currency financial statements into U.S. dollars are included in determining comprehensive income / loss. Transactions denominated in foreign currencies are translated into the functional currency at the exchange rates prevailing on the transaction dates. Assets and liabilities denominated in foreign currencies are translated into the functional currency at the exchange rates prevailing at the balance sheet date with any transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in the results of operations as incurred. All of the Company’s revenue transactions are transacted in its functional currency. The Company does not enter into any material transaction in foreign currencies. Transaction gains or losses have not had, and are not expected to have, a material effect on the results of operations of the Company. Asset and liability accounts at March 31, 2018 and December 31, 2017 were translated at 6.2881 RMB to $1.00 and at 6.5063 RMB to $1.00, respectively, which were the exchange rates on the balance sheet dates. Equity accounts were stated at their historical rates. The average translation rates applied to the statements of operations for the three months ended March 31, 2018 and 2017 were 6.3714 RMB and 6.8925 RMB to $1.00, respectively. Cash flows from the Company’s operations are calculated based upon the local currencies using the average translation rate. Credit Risk and Concentration The Company’s financial instruments that are potentially subject to concentrations of credit risk consist primarily of cash and cash equivalents. The majority of cash equivalents consists of short-term money market funds, which are managed by reputable financial institutions. The Company performs ongoing credit evaluations of borrowers, and generally do not require additional collateral except for personal vehicles. No borrowers represented 10% or more of total revenue for the three months ended March 31, 2018 and 2017. Comprehensive Income (Loss) Other comprehensive income (loss) refers to revenues, expenses, gains and losses that under generally accepted accounting principles are included in comprehensive income (loss) but are excluded from net income (loss) as these amounts are recorded directly as an adjustment to stockholders’ equity. The Company’s other comprehensive income (loss) is comprised of foreign currency translation adjustments. 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 non-financial 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 March 31, 2018 and December 31, 2017. Related Parties A party is considered to be related to the Company if the party directly or indirectly or through one or more intermediaries, controls, is controlled by, or is under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. A party which can significantly influence the management or operating policies of the transacting parties or if it has an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests is also a related party. Recent Accounting Pronouncements Revenue Recognition: Revenue from Contracts with Customers: Topic Step 1: Identify the contract(s) with a customer. Step 2: Identify the performance obligations in the contract. Step 3: Determine the transaction price. Step 4: Allocate the transaction price to the performance obligations in the contract. Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation. In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net) Leases: Statement of Cash Flows: Statement of Cash Flows: Business Combination Business Combinations (Topic 805): Clarifying the Definition of a Business Revenue Recognition and Leases: Except for the ASU above, in the period from February 2018 through March 2018, the FASB has issued ASU No. 2018-02 through ASU 2018-04, which are not expected to have a material impact on the consolidated financial statements upon adoption. |
Other Receivable
Other Receivable | 3 Months Ended |
Mar. 31, 2018 | |
Other Receivable [Abstract] | |
OTHER RECEIVABLE | NOTE 3 – OTHER RECEIVABLE Other receivable consists of deposits and advances made to employees and other third parties to pay for operating expenses, such as property maintenance, water and sewer, and telephone bills. Other receivable as of March 31, 2018 and December 31, 2017 were $84,104 and $19,327, respectively. |
Security Deposit
Security Deposit | 3 Months Ended |
Mar. 31, 2018 | |
Security Deposit [Abstract] | |
SECURITY DEPOSIT | NOTE 4 – SECURITY DEPOSIT Pursuant to the terms of the Jinchangan Lease agreement, Beijing Jiucheng agreed to pay three months of rent and maintenance fee as security deposit for a total of RMB 472,678 (approximately $75,000). Beijing Jiucheng classified the security deposit as long term asset on the consolidated balance sheets as the lease expires on May 21, 2019. |
Property and Equipment
Property and Equipment | 3 Months Ended |
Mar. 31, 2018 | |
Property and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | NOTE 5 - PROPERTY AND EQUIPMENT Property and equipment consist of the following: March 31, December 31, 2018 2017 Office furniture $ 24,993 $ 24,155 Computer and office equipment 43,387 41,932 Vehicle 114,586 110,743 Total property and equipment 182,966 176,830 Less: accumulated depreciation (155,648 ) (141,497 ) Total $ 27,318 $ 35,333 Total depreciation expenses for the three months ended March 31, 2018 and 2017 were $9,120 and $13,910, respectively. The Company did not capitalize the costs associated with building the online financial platform as the costs were nominal. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2018 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 6 - RELATED PARTY TRANSACTIONS The following is a list of related parties to which the Company has transactions with: (a) Xiangbin Meng (“Meng”), the Company’s Chairman and a shareholder of Beijing Jiucheng; (b) Jiuyuan Investment Co., Ltd. (“Jiuyuan”), a shareholder of Beijing Jiucheng; (c) Beijing JiuCheng Huijin Information Consulting Co., Ltd (“Jiucheng Huijin”), an affiliated Company; (d) Yasheng International Investment Ltd. (“Yasheng”), a former shareholder of Beijing Jiucheng; (e) Beijing Jiuyuan Investment Share Holding Co., Ltd (“Beijing Jiuyuan”), an affiliated Company; (f) Beijing Jiuxiang Financing Lease Co., Ltd. (“Jiuxiang”), an affiliated Company. (g) Beijing Hengjiu Investment Management Co.,Ltd (“Beijing Hengjiu”), an affiliated Company (h) Yangming Development Limited (“Yangming”), a shareholder of the Company Amount due from related parties: Amount due from related parties consisted of the following as of: March 31, December 31, Xiangbin Meng – Fees Receivable $ 97,997 $ 3,444 Jiuyuan 20,873 20,204 Beijing Hengjiu 53,286 51,653 Total $ 172,156 $ 75,301 Prior to July 2017, Meng collected the service fees from the loan borrowers on behalf of the Company, Zhongcheng Zhengxin, and Hengjiu. Meng then distributed to each party in accordance to the predetermined service fees percentage. As of March 31, 2018 and December 31, 2017, amount due from Meng for service revenue collected by Meng on the Company’s behalf and not yet distribute to the Company was $97,997 and $3,444, respectively. Beijing Jiucheng is 70% owned by Jiuyuan. From time to time, the Company and Jiuyuan paid general and administrative expenses for each other. During the three months ended March 31, 2018 and 2017, Jiuyuan paid on behalf of the Company for working capital totaled $31 and $3,660, respectively. The Company made advances to Jiuyuan for working capital totaled $0 and $9,165,199, respectively and received repayments totaled $-0- and $5,415,895, respectively. The Company received advances from Jiuyuan for working capital totaled $0 and $3,576,355, respectively. As of March 31, 2018 and December 31, 2017, the Company has an amount due from Jiuyuan of $20,873 and $20,204, respectively. Beijing Hengjiu is 75% owned by Jiuyuan and 25% owned by Meng. During the three months ended March 31, 2018 and 2017, Beijing Hengjiu paid on behalf of the Company for working capital totaled $157 and $-0-, respectively. As of March 31, 2018 and December 31, 2017, the Company has an amount due from Beijing Hengjiu of $53,286 and $51,653, respectively. Amount due to related parties Amount due to related parties consisted of the following as of: March 31, December 31, Jiucheng Huijin 2,601 10,199 Beijing Jiuyuan 2,545 2,460 Jiuxiang 6,298 6,087 Yangming 5,107 4,936 Total $ 16,551 $ 23,682 Jiucheng Huijin is 30% owned by Meng. From time to time, Jiucheng Huijin paid general and administrative expenses on behalf of the Company. As of March 31, 2018 and December 31, 2017, the Company recorded $2,601 and $10,199 due to Jiucheng Huijin, respectively. On June 30, 2016, Jiucheng Huijin entered a contract to lease two vehicles from the Company. The contract started on June 30, 2016 and expired on January 31, 2018. Pursuant to the terms of the contract, Jiucheng Huijin has agreed to pay a monthly rental fee of RMB 25,000 (approximately $3,600) per vehicle. The Company recorded a rental income of $7,848 and $21,763 for the three months ended March 31, 2018 and 2017, respectively as part of other income in the accompanying condensed consolidated statements operations and comprehensive income. Beijing Jiuyuan is 51% owned by Meng. On October 21, 2015, Beijing Jiuyuan entered into a six-year lease (“Chaoyang Lease”) and the lease was subsequently transferred to Jiuxiang on August 12, 2016. The Company shares the office space with Beijing Jiuyuan and three other affiliated companies under the Chaoyang Lease. The rent expense allocated to the Company each month is in accordance to the number of employees occupied in the office space. As of March 31, 2018 and December 31, 2017, amounts due to Beijing Jiuyuan related to rent expense were $2,545 and $2,460, respectively. Jiuxiang is 75% owned by Jiuyuan. As mentioned above, Jiuxiang took over the lease since August 12, 2016. As of March 31, 2018 and December 31, 2017, the Company recorded $6,298 and $6,087 due to Jiuxiang, respectively, for the rent expense. Yangming owns 26.3% of the Company. Yangming paid general and administrative expenses on behalf of the Company, As of March 31, 2018 and December 31, 2017, the Company recorded $5,107 and $4,936 due to Yangming, respectively. For the three months ended March 31, 2018 and 2017, due to (from) related party activities consisted of the following: Jiuyuan Meng Meng - Receivable Yasheng Jiucheng Huijin Beijing Jiuyuan Jiuxiang Beijing Hengjiu Yangming Total Balance due (from) to related parties, December 31, 2017 $ (20,204 ) $ - $ (3,444 ) $ - $ 10,199 $ 2,460 $ 6,087 $ (51,653 ) $ 4,936 $ (51,619 ) Operating activities - Due from related parties 31 - (93,199 ) - - - - 157 - (93,011 ) Financing activities - Repayments to related parties - - - - (7,848 ) - - - - (7,848 ) Effect of foreign currency exchange (700 ) - (1,354 ) - 250 85 211 (1,790 ) 171 (3,127 ) Balance due (from) to related parties, March 31, 2018 $ (20,873 ) $ - $ (97,997 ) $ - $ 2,601 $ 2,545 $ 6,298 $ (53,286 ) $ 5,107 $ (155,605 ) Jiuyuan Meng Meng - Receivable Yasheng Jiucheng Huijin Beijing Jiuyuan Jiuxiang Beijing Hengjiu Yangming Total Balance due (from) to related parties, December 31, 2016 $ 378,950 $ (11,311,447 ) $ (1,877,130 ) $ 8,917 $ 5,867 $ 2,304 $ 1,263 $ - $ - $ (12,791,276 ) Operating activities - Due from related parties - - (315,707 ) - (20,950 ) (2,322 ) (277 ) - - (339,256 ) Operating activities - Due to related parties 3,660 - - - - - - - - 3,660 Investing activities - Working capital advances to related parties (9,165,199 ) - - - - - - - - (9,165,199 ) Investing activities - Repayments from related parties 5,415,895 991,112 - - - - - - - 6,407,007 Financing activities - Advances from related parties 3,576,355 (29,506 ) - - - - - - - 3,546,849 Non-cash Capital reduction 8,124,744 3,482,033 - - - - - - - 11,606,777 Internal transfers (8,174,148 ) 6,953,828 1,220,320 - - - - - - - Effect of foreign currency exchange 2,697 (115,497 ) (13,186 ) 59 59 18 8 - - (125,842 ) Balance due (from) to related parties, March 31, 2017 $ 162,954 $ (29,477 ) $ (985,703 ) $ 8,976 $ (15,024 ) $ - $ 994 $ - $ - $ (857,280 ) |
Other Payable
Other Payable | 3 Months Ended |
Mar. 31, 2018 | |
Other Payable [Abstract] | |
OTHER PAYABLE | NOTE 7 – OTHER PAYABLE Other payable consists of the following as of March 31, 2018 and December 31, 2017: March 31, December 31, Social security and provident fund payable $ 206,096 $ 44,254 Salary payable 61,082 64,653 Other levies 12,624 24,186 Total $ 279,802 $ 133,093 |
VAT Payable
VAT Payable | 3 Months Ended |
Mar. 31, 2018 | |
VAT Payable [Abstract] | |
VAT PAYABLE | NOTE 8 – VAT PAYABLE The Company’s VAT payable consists of 6% on the revenue generated and 3% on the other income generated from car leasing. VAT payable as of March 31, 2018 and December 31, 2017 were $104,881 and $195,308, respectively. The Company is currently reviewing its historical VAT tax returns and will make appropriate amendments where applicable. The VAT payable has been properly accrued for based on the required VAT rate as of March 31, 2018 and December 31, 2017. |
Statutory Reserve
Statutory Reserve | 3 Months Ended |
Mar. 31, 2018 | |
Statutory Reserve [Abstract] | |
STATUTORY RESERVE | NOTE 9 - 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% of after-tax profit until the aggregated appropriations reach 50% of the registered capital (as determined under accounting principles generally accepted in the PRC (“PRC GAAP”) at each year-end). The Company did not make appropriations to statutory reserve as of March 31, 2018 as the Company is able to use the current period (2018) net income after tax to offset against the accumulate loss from prior periods. |
Equity Transactions
Equity Transactions | 3 Months Ended |
Mar. 31, 2018 | |
Equity Transactions [Abstract] | |
EQUITY TRANSACTIONS | NOTE 10 - EQUITY TRANSACTIONS Capital reduction of VIE, Beijing Jiucheng Upon formation, Meng contributed RMB 30,000,000 ($4,800,811) and Jiuyuan contributed RMB 70,000,000 ($11,201,893) for a total of RMB 100,000,000 ($16,002,704) to Beijing Jiucheng. As Beijing Jiucheng’s main revenue source is from intermediary services and management was not anticipating to make significant capital expenditures, on February 15, 2017, the Board of directors of Beijing Jiucheng proposed to reduce the capital. Upon approval by the majority shareholders and Board of Directors of Beijing Jiucheng, on February 15, 2017, Beijing Jiucheng reduced the contributed capital from RMB 100,000,000 ($16,002,704) to RMB 20,000,000 ($4,482,799). Beijing Jiucheng has obtained the new business license reflecting the change. Capital reduction made subsequent to December 31, 2016 for the two shareholders are as follows: In RMB: Formation Capital Reduction After Reduction Ownership Meng 30,000,000 (24,000,000 ) 6,000,000 30 % Jiuyuan 70,000,000 (56,000,000 ) 14,000,000 70 % 100,000,000 (80,000,000 ) 20,000,000 100 % In USD: Formation Capital Reduction After Reduction Ownership Meng 4,800,811 (3,455,971 ) 1,344,840 30 % Jiuyuan 11,201,893 (8,063,934 ) 3,137,959 70 % 16,002,704 (11,519,905 ) 4,482,799 100 % A debt transfer agreement was signed between Meng and Jiuyuan on February 28, 2017. Pursuant to the terms of the agreement, Jiuyuan agreed to transfer to Meng a total of RMB 56,340,519 ($8,112,967) owed by Beijing Jiucheng. On February 28, 2017, a debt offset agreement was signed between Beijing Jiucheng and Meng and pursuant to the terms of this agreement, the amount due to Jiuyuan which was transferred to Meng plus Meng’s portion of the capital reduction were offset by the amount due from Meng. As a result of the capital reduction, the debt offset agreement and repayment received, the amount due from related parties, Meng that was reclassified as contra-equity account at December 31, 2016 has been repaid and reduced to zero by $11,519,905 during the first quarter ended March 31, 2017. Subscription receivable of the subsidiaries’ paid in capital As of March 31, 2018 and December 31, 2017, the subscription receivable of the subsidiaries’ paid in capital (I JIU JIU and Ruixiang) was $51,289. Reverse merger On November 10, 2017, Jiucaitong, I JIU JIU Limited (“I JIU JIU”), the holding company of Ruixiang Technology Group,Ltd. (“Rui Xiang”), and the shareholders of I JIU JIU entered into the Share Exchange Agreement, which closed on the same date. Pursuant to the terms of the Share Exchange Agreement, Jiucaitong exchanged 8,000,000 shares of their common stock for all of the outstanding capital stock of I JIU JIU with the result that I JIU JIU became a wholly owned subsidiary of Jiucaitong. Pursuant to the Merger, all of the issued and outstanding shares of I JIU JIU common stock were converted, at an exchange ratio of 160-for-1, into an aggregate of 8,000,000 shares of the Company or Jiucaitong, formerly known as Spirit International Inc. common stock and I JIU JIU became a wholly owned subsidiary of the Company or Jiucaitong. The holders of the Company’s common stock as of immediately prior to the Merger held an aggregate of 5,110,000 shares and in connection with the Share Exchange Agreement, the Company’s former majority shareholder, Kimho Consultants Company Limited, (“Kimho” or the “Majority Shareholder”) entered into a share cancellation agreement with I JIU JIU’s stockholders whereby Kimho, owning an aggregate of 4,000,000 shares of the Company’s Common Stock agreed to cancel all its 4,000,000 shares of Common Stock in exchange of $440,000 paid by I JIU JIU’s stockholders (“Share Cancellation”). The common stocks as of March 31, 2018 and December 31, 2017 were 9,110,000 shares. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2018 | |
Commitments and Contingencies [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 11 - COMMITMENTS AND CONTINGENCIES Operating Leases The Company shares its principal office with four other affiliated companies in Chaoyang, Beijing. On October 21, 2015, the Company entered into a six-year lease (“Chaoyang Lease”) and the lease was subsequently transferred to Jiuxiang on August 12, 2016. The Chaoyang Lease started on October 21, 2015 and expires on October 20, 2021. Pursuant to the terms of the lease, Jiuxiang has agreed to pay a monthly rent of RMB 491,168 (approximately $74,000) for the first three years and RMB 540,534 (approximately $81,000) for the remaining three years. The Company recognizes rent expense on a straight-line basis over the terms of the leases. The rent expense allocated to the Company each month is in accordance to the number of employees occupied in the office space. The Company operates its business in an office located at Xizhimen, Beijing, China. The Company entered into a lease agreement (“Xizhimen Lease”) on January 1, 2015 pursuant to which the Company agreed to pay $24,000 per month and the lease expired on May 31, 2017. On May 22, 2017, the Company entered into another operating lease agreement in Beijing as the successor of the Xizhimen Lease. Pursuant to the terms of the agreement, the lease started from May 22, 2017 and expires on May 21, 2019 and the Company agreed to pay monthly rent of RMB 142,241 (approximately $20,000) from June 22, 2017 to May 21, 2019 with the first month rent free and monthly maintenance fee of RMB 15,318 (approximately $2,200) from May 21, 2017 to May 21, 2019. The Company recognizes rent expense and maintenance fee on a straight-line basis over the terms of the lease. As of March 31, 2018, the Company was obligated under operating leases minimum rentals as follows: Allocated Lease * Non-Cancellable Lease ** Total 2018 $ 4,393 $ 289,371 $ 293,764 2019 4,393 112,792 117,185 2020 4,393 - 4,393 2021 3,661 - 3,661 2022 - - - Total minimum lease payments $ 16,840 $ 402,163 $ 419,003 * - These are the Company’s portion of minimum lease payments allocated by the Company’s affiliated company, Jiuxiang, the leasee. ** - These are the minimum lease payments under the non-cancellable lease entered with a third party. |
Subsequent Event
Subsequent Event | 3 Months Ended |
Mar. 31, 2018 | |
Subsequent Event [Abstract] | |
SUBSEQUENT EVENT | NOTE 12 - SUBSEQUENT EVENT On April 23, 2018, a related party of the Company, Jiuyuan, entered into a loan agreement with Jiucheng to borrow 15,000,000 RMB (approximately $2.39 million). The loan matures in six months with a monthly interest rate of 0.3625%. The Company recorded a loan receivable from the related party accordingly. The amount will be repaid by the related party before June 30, 2018. |
Basis of Presentation and Sum18
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2018 | |
Basis of Presentation and Summary of Significant Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The unaudited condensed 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 financial statements are expressed in U.S. dollars. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three months ended March 31, 2018 are not necessarily indicative of the results that may be expected for the year ending December 31, 2018. The unaudited condensed consolidated financial statements should be read in conjunction with the audited financial statements as of and for the year ended December 31, 2017 and footnotes thereto included in the same document. The condensed consolidated balance sheet as of December 31, 2017 contained herein has been derived from the audited financial statements as of December 31, 2017 but does not include all disclosures required by the generally accepted accounting principles in the U.S. (“U.S. GAAP”). |
Basis of Consolidation | Basis of Consolidation The consolidated financial statements include the financial statements of the Company, its wholly-owned subsidiaries, I JIU JIU, Ruixiang, Jiucheng Consulting and its VIE, Beijing Jiucheng. All inter-company transactions and balances have been eliminated upon consolidation. |
Use of Estimates and Assumptions | Use of Estimates and Assumptions The preparation of 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. Significant estimates as of and during the periods ended March 31, 2018 and December 31, 2017 include the allowance for doubtful accounts, the useful life of property and equipment, assumptions used in assessing impairment of long-term assets, valuation of deferred tax assets and accruals for taxes due. |
Financial Instrument | Financial Instrument The carrying amount reported in the consolidated balance sheet for cash, accounts receivable, other receivables, accrued liabilities and other payables approximate fair value because of the immediate or short-term maturity of these financial instruments. |
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. The Company maintains with various financial institutions in the PRC. At March 31, 2018 and December 31, 2017, cash balances held in PRC banks are uninsured. The Company has not experienced any losses in bank accounts and believes it is not exposed to any risks on its cash in bank accounts. |
Restricted Cash | Restricted Cash Cash that is deposited in the bank but restricted for a specific purpose and therefore not available for immediate and general use by the Company is classified as restricted cash, which is presented separately from cash and cash equivalents on the consolidated balance sheets. The deposited balance is included in the Company’s bank account for guarantee of certain business purpose under an agreement until being used for the designated purpose or withdrawn due to expiration of the guarantee. As of March 31, 2018 and December 31, 2017, the Company had a restricted cash balance of $190,837 and $184,437, respectively. |
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 improvements 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. Estimated useful lives are as follows, taking into account the assets’ estimated residual value: Classification Estimated useful life Computer and office equipment 3 years Furniture 3 years Vehicles 3 years |
Advances from Customers | Advances from Customers Advances from customers at March 31, 2018 and December 31, 2017 amounted to $249,847 and $114,191, respectively, and consist of prepayments from customers for services that have not been performed. The Company will recognize the deposits as revenue when the services have been performed in accordance with the Company’s revenue recognition policy. |
Earnings per Share | Earnings per Share Basic earnings per share is computed by dividing net income by the weighted-average number of common shares outstanding during the period. Diluted earnings (loss) per share is computed by dividing net income by the weighted-average number of common shares and dilutive potential common shares outstanding during the period. For the three months ended March 31, 2018 and 2017, respectively, there were no outstanding securities or other contracts to issue common stock, such as options, warrants or conversion rights, which would have a dilutive effect on earnings per share. |
Revenue Recognition | Revenue Recognition The Company provides intermediary services to the personal loan borrowers and the financial products investors. The Company charges fees for the intermediary services to the personal loan borrowers. Prior to July 2017, the revenue process started when an individual who had financing needs submited the loan application to Beijing Hengjiu Investment Management Co., Ltd. (“Hengjiu”). Hengjiu, along with its sub-contractor, Zhongcheng Zhengxin (Beijing) Co., Ltd. (“Zhongcheng Zhengxin”), provided financial consulting services such as loan origination criteria checkup, risk assessment, and assessment/evaluation of vehicle collateral. Hengjiu is a related party which was 75% owned by Jiuyuan Investment Co., Ltd. After the borrowers received the fund transfer, the Company then packaged the debt claims of Meng into corresponding financial products and placed in its physical stores or on its on-line platform for sale. Investors of those financial products were able to choose the financial products that met their needs. Meng transfered his debt upon signing the debt transfer agreement with the financial products investors. The services were originally provided in physical stores in Beijing, Baoding, Hebei province and Weihai, Shandong province. Since April 2016, Beijing Jiucheng started to move majority of the business to its financial advisory on-line platform, Jiucaitong (www.9caitong.com). As less labor was required, in June 2016, Beijing Jiucheng shut down the physical stores in Baoding and Weihai. Meng was responsible for making the loans, transferring the funds to the borrowers and collecting the service fees on behalf of all parties involved. Meng collected a portion of the service fees upfront and the rest on a monthly basis over the term of the loan from loan borrowers. The Company recognizes revenue, net of value-added taxes in the periods in which the related services were performed provided that persuasive evidence of an arrangement exists, the amount of the service fee is fixed in the loan agreements, and collectability is reasonably assured. The revenue was recognized when the loan agreements were executed and the funds were transferred to the loan borrowers, based on the predetermined service fee percentage of the total loan principal over the term of the loan. According to the service fee allocation agreement, Beijing Jiucheng was entitled to a service fee of 1% of the loan principal per month before July 1, 2016 and 1.5% per month effective July 1, 2016 and thereafter as Beijing Jiucheng increased the loan management and risk assessment services that were originally done by Beijing Hengjiu since May 2016. Since July 2017, the Company officially launched the bank depository system and is providing intermediary services for all registered users, including consultation, information and all kinds of delegation service. The Company started to charge the service fee from the amount borrowed by the borrower at the difference between the borrowers’ actual rate and the investors’ yield rate. Upon launching of the bank depository system, Meng no longer serves as the maker of the loan for the borrowers who use Jiucaitong on-line platform. The borrowers and investors enter the loan agreements directly with the online platform, Jiucaitong. Since December 2017, the online platform also provides loan intermediary services to the restaurant owners which operate the same as the rest of the borrowers except for that the restaurant owners use restaurants as collateral. Allowance for Doubtful Accounts Service fee receivable is recorded and carried at the original invoiced amount less an allowance for any potential uncollectible amounts. The Company makes estimates for the allowance for doubtful accounts based upon the assessment of various factors, including historical, experience, the age of the accounts receivable balances, credit quality of the loan borrowers, current economic conditions, and other factors that may affect the borrowers’ ability to pay. No allowance has been provided for at March 31, 2018 and December 31, 2017 as the service fees have been fully collected from the loan borrowers during the respective periods or subsequently. |
Advertising Expense | Advertising Expense The Company expenses advertising costs as they incurred. Total advertising expenses were $15,238 and $20,581 for the three months ended March 31, 2018 and 2017, respectively, and have been included as part of selling expenses in the accompanying statements of operations and comprehensive income. |
Value-added Taxes | Value-added Taxes Pursuant to the PRC tax laws, in case of the financial services provided, generally the value added tax (“VAT”) rate is 3% of the gross sales for small scale VAT payer and 6% of the gross sales for general VAT payer. The accrued VAT is recorded as VAT payables in the consolidated financial statements. VAT is reported as a liability when incurred. |
Income Taxes | Income Taxes The Company accounts for income taxes in accordance with U.S. GAAP for income taxes. Under the asset and liability method as required by this accounting standard, the recognition of deferred income tax liabilities and assets for the expected future tax consequences of temporary differences between the income tax basis and financial reporting basis of assets and liabilities. Provision for income taxes consists of taxes currently due plus deferred taxes. The charge for taxation is based on the results for the fiscal year as adjusted for items, which are non-assessable or disallowed. It is calculated using tax rates that have been enacted or substantively enacted by the balance sheet date. Deferred taxes are accounted for using the asset and liability method in respect of temporary differences arising from differences between the carrying amount of assets and liabilities in the consolidated financial statements and the corresponding tax basis used in the computation of assessable tax profit. Deferred tax liabilities are recognized for all future taxable temporary differences. Deferred tax assets are recognized to the extent that it is probable that taxable income will be available against which deductible temporary differences can be utilized. Deferred tax is calculated using tax rates that are expected to apply to the period when the asset is realized or the liability is settled. Deferred tax is charged or credited in the operations of statement, except when it is related to items credited or charged directly to equity. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Current income taxes are provided for in accordance with the laws of the relevant taxing authorities. On December 22, 2017, the Tax Cuts and Jobs Act (the “Tax Act”) was enacted by the U.S. government which included a wide range of tax reform affecting businesses including the corporate tax rates, international tax provisions, tax credits and deduction with majority of the tax provision effective after December 31, 2017. Certain activities conducted in foreign jurisdictions may result in the imposition of U.S. corporate income taxes on the Company when its subsidiaries, controlled foreign corporations (“CFCs”), generate income that is subject to Subpart F or GILTI under the U.S. Internal Revenue Code beginning after December 31, 2017. An uncertain 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 amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded. As of , the Company had no uncertain tax positions, and will continue to evaluate for uncertain positions in the future |
Foreign Currency Translation | Foreign Currency Translation The functional currency of the Company’s operations in the PRC is the Chinese Yuan or Renminbi (“RMB”). The financial statements are translated to U.S. dollars using the period end rates of exchange for assets and liabilities, equity is translated at historical exchange rates, and average rates of exchange (for the period) are used for revenues and expenses and cash flows. As a result, amounts relating to assets and liabilities reported on the statements of cash flows may not necessarily agree with the changes in the corresponding balances on the balance sheets. Translation adjustments resulting from the process of translating the local currency financial statements into U.S. dollars are included in determining comprehensive income / loss. Transactions denominated in foreign currencies are translated into the functional currency at the exchange rates prevailing on the transaction dates. Assets and liabilities denominated in foreign currencies are translated into the functional currency at the exchange rates prevailing at the balance sheet date with any transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in the results of operations as incurred. All of the Company’s revenue transactions are transacted in its functional currency. The Company does not enter into any material transaction in foreign currencies. Transaction gains or losses have not had, and are not expected to have, a material effect on the results of operations of the Company. Asset and liability accounts at March 31, 2018 and December 31, 2017 were translated at 6.2881 RMB to $1.00 and at 6.5063 RMB to $1.00, respectively, which were the exchange rates on the balance sheet dates. Equity accounts were stated at their historical rates. The average translation rates applied to the statements of operations for the three months ended March 31, 2018 and 2017 were 6.3714 RMB and 6.8925 RMB to $1.00, respectively. Cash flows from the Company’s operations are calculated based upon the local currencies using the average translation rate. |
Credit Risk and Concentration | Credit Risk and Concentration The Company’s financial instruments that are potentially subject to concentrations of credit risk consist primarily of cash and cash equivalents. The majority of cash equivalents consists of short-term money market funds, which are managed by reputable financial institutions. The Company performs ongoing credit evaluations of borrowers, and generally do not require additional collateral except for personal vehicles. No borrowers represented 10% or more of total revenue for the three months ended March 31, 2018 and 2017. |
Comprehensive Income (Loss) | Comprehensive Income (Loss) Other comprehensive income (loss) refers to revenues, expenses, gains and losses that under generally accepted accounting principles are included in comprehensive income (loss) but are excluded from net income (loss) as these amounts are recorded directly as an adjustment to stockholders’ equity. The Company’s other comprehensive income (loss) is comprised of foreign currency translation adjustments. |
Fair Value Measurements | 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 non-financial 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 March 31, 2018 and December 31, 2017. |
Related Parties | Related Parties A party is considered to be related to the Company if the party directly or indirectly or through one or more intermediaries, controls, is controlled by, or is under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. A party which can significantly influence the management or operating policies of the transacting parties or if it has an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests is also a related party. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Revenue Recognition: Revenue from Contracts with Customers: Topic Step 1: Identify the contract(s) with a customer. Step 2: Identify the performance obligations in the contract. Step 3: Determine the transaction price. Step 4: Allocate the transaction price to the performance obligations in the contract. Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation. In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net) Leases: Statement of Cash Flows: Statement of Cash Flows: Business Combination Business Combinations (Topic 805): Clarifying the Definition of a Business Revenue Recognition and Leases: Except for the ASU above, in the period from February 2018 through March 2018, the FASB has issued ASU No. 2018-02 through ASU 2018-04, which are not expected to have a material impact on the consolidated financial statements upon adoption. |
Basis of Presentation and Sum19
Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Basis of Presentation and Summary of Significant Accounting Policies [Abstract] | |
Summary of estimated useful lives | Classification Estimated useful life Computer and office equipment 3 years Furniture 3 years Vehicles 3 years |
Property and Equipment (Tables)
Property and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Property and Equipment [Abstract] | |
Schedule of property and equipment | March 31, December 31, 2018 2017 Office furniture $ 24,993 $ 24,155 Computer and office equipment 43,387 41,932 Vehicle 114,586 110,743 Total property and equipment 182,966 176,830 Less: accumulated depreciation (155,648 ) (141,497 ) Total $ 27,318 $ 35,333 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Related Party Transactions [Abstract] | |
Schedule of due from related parties | March 31, December 31, Xiangbin Meng – Fees Receivable $ 97,997 $ 3,444 Jiuyuan 20,873 20,204 Beijing Hengjiu 53,286 51,653 Total $ 172,156 $ 75,301 |
Schedule of due to related parties | March 31, December 31, Jiucheng Huijin 2,601 10,199 Beijing Jiuyuan 2,545 2,460 Jiuxiang 6,298 6,087 Yangming 5,107 4,936 Total $ 16,551 $ 23,682 |
Schedule of due to (from) related party activities | Jiuyuan Meng Meng - Receivable Yasheng Jiucheng Huijin Beijing Jiuyuan Jiuxiang Beijing Hengjiu Yangming Total Balance due (from) to related parties, December 31, 2017 $ (20,204 ) $ - $ (3,444 ) $ - $ 10,199 $ 2,460 $ 6,087 $ (51,653 ) $ 4,936 $ (51,619 ) Operating activities - Due from related parties 31 - (93,199 ) - - - - 157 - (93,011 ) Financing activities - Repayments to related parties - - - - (7,848 ) - - - - (7,848 ) Effect of foreign currency exchange (700 ) - (1,354 ) - 250 85 211 (1,790 ) 171 (3,127 ) Balance due (from) to related parties, March 31, 2018 $ (20,873 ) $ - $ (97,997 ) $ - $ 2,601 $ 2,545 $ 6,298 $ (53,286 ) $ 5,107 $ (155,605 ) Jiuyuan Meng Meng - Receivable Yasheng Jiucheng Huijin Beijing Jiuyuan Jiuxiang Beijing Hengjiu Yangming Total Balance due (from) to related parties, December 31, 2016 $ 378,950 $ (11,311,447 ) $ (1,877,130 ) $ 8,917 $ 5,867 $ 2,304 $ 1,263 $ - $ - $ (12,791,276 ) Operating activities - Due from related parties - - (315,707 ) - (20,950 ) (2,322 ) (277 ) - - (339,256 ) Operating activities - Due to related parties 3,660 - - - - - - - - 3,660 Investing activities - Working capital advances to related parties (9,165,199 ) - - - - - - - - (9,165,199 ) Investing activities - Repayments from related parties 5,415,895 991,112 - - - - - - - 6,407,007 Financing activities - Advances from related parties 3,576,355 (29,506 ) - - - - - - - 3,546,849 Non-cash Capital reduction 8,124,744 3,482,033 - - - - - - - 11,606,777 Internal transfers (8,174,148 ) 6,953,828 1,220,320 - - - - - - - Effect of foreign currency exchange 2,697 (115,497 ) (13,186 ) 59 59 18 8 - - (125,842 ) Balance due (from) to related parties, March 31, 2017 $ 162,954 $ (29,477 ) $ (985,703 ) $ 8,976 $ (15,024 ) $ - $ 994 $ - $ - $ (857,280 ) |
Other Payable (Tables)
Other Payable (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Other Payable [Abstract] | |
Summary of other payable | March 31, December 31, Social security and provident fund payable $ 206,096 $ 44,254 Salary payable 61,082 64,653 Other levies 12,624 24,186 Total $ 279,802 $ 133,093 |
Equity Transactions (Tables)
Equity Transactions (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Equity Transactions [Abstract] | |
Summary of capital reduction to shareholders | Formation Capital Reduction After Reduction Ownership Meng 30,000,000 (24,000,000 ) 6,000,000 30 % Jiuyuan 70,000,000 (56,000,000 ) 14,000,000 70 % 100,000,000 (80,000,000 ) 20,000,000 100 % In USD: Formation Capital Reduction After Reduction Ownership Meng 4,800,811 (3,455,971 ) 1,344,840 30 % Jiuyuan 11,201,893 (8,063,934 ) 3,137,959 70 % 16,002,704 (11,519,905 ) 4,482,799 100 % |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Income Taxes [Abstract] | |
Schedule of deferred tax | 2017 2016 Deferred tax assets: Timing differences of advertisement expense $ — $ 16,265 Net operating losses in US 13,603 20,291 Net operating losses in PRC 303,260 400,564 Total deferred tax assets 316,863 437,120 Less: valuation allowance (316,863 ) (437,120 ) Deferred tax assets, net $ — $ — Deferred tax liabilities: $ — $ — Total deferred tax liabilities $ — $ — |
Schedule of components of income tax expense | For the For the year year ended ended December 31, December 31, 2017 2016 Current tax expense $ - $ - Deferred tax expense - - Benefits of operating loss carryforwards - - Tax expense (benefit) $ - $ - |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Commitments and Contingencies [Abstract] | |
Schedule of operating leases minimum rentals | Allocated Lease * Non-Cancellable Lease ** Total 2018 $ 4,393 $ 289,371 $ 293,764 2019 4,393 112,792 117,185 2020 4,393 - 4,393 2021 3,661 - 3,661 2022 - - - Total minimum lease payments $ 16,840 $ 402,163 $ 419,003 * - These are the Company’s portion of minimum lease payments allocated by the Company’s affiliated company, Jiuxiang, the leasee. ** - These are the minimum lease payments under the non-cancellable lease entered with a third party. |
Nature of Operations (Details)
Nature of Operations (Details) - shares | Nov. 10, 2017 | Mar. 31, 2018 |
Nature of Operations (Textual) | ||
Entity Incorporation, Date of Incorporation | Mar. 10, 2014 | |
Entity Incorporation, State Country Name | Beijing Jiucheng was incorporated in Beijing, China on January 13, 2012 under the law of People's Republic of China ("PRC" or "China"). | |
Reverse stock split | 160-for-1 | |
Common shares of capital stock issued | 8,000,000 | 8,000,000 |
Reverse merger description | The holders of the Company's common stock as of immediately prior to the Merger held an aggregate of 5,110,000 shares and in connection with the Share Exchange Agreement, the Company's former majority shareholder, Kimho Consultants Company Limited, ("Kimho" or the "Majority Shareholder") entered into a share cancellation agreement with I JIU JIU's stockholders whereby Kimho, owning an aggregate of 4,000,000 shares of the Company's Common Stock agreed to cancel all its 4,000,000 shares of Common Stock in exchange of $440,000 paid by I JIU JIU's stockholders ("Share Cancellation"). |
Basis of Presentation and Sum27
Basis of Presentation and Summary of Significant Accounting Policies (Details) | 3 Months Ended |
Mar. 31, 2018 | |
Computer and office equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life (in years) | 3 years |
Furniture [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life (in years) | 3 years |
Vehicles [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life (in years) | 3 years |
Basis of Presentation and Sum28
Basis of Presentation and Summary of Significant Accounting Policies (Details Textual) - USD ($) | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Basis of Presentation and Summary of Significant Accounting Policies (Textual) | |||
Restricted cash balance | $ 190,837 | $ 184,437 | |
Advances from customers | $ 249,847 | $ 114,191 | |
Distribution on equity method investment | Hengjiu is a related party which was 75% owned by Jiuyuan Investment Co., Ltd. ("Jiuyuan"), a shareholder of Beijing Jiucheng, and 25% owned by Xiangbin Meng, the Company's Chairman. | ||
Service fee, percentage | Beijing Jiucheng was entitled to a service fee of 1% of the loan principal per month before July 1, 2016 and 1.5% per month effective July 1, 2016 and thereafter as Beijing Jiucheng increased the loan management and risk assessment services that were originally done by Beijing Hengjiu since May 2016. | ||
Advertising expenses | $ 15,238 | $ 20,581 | |
Description on value added taxes | Financial services provided, generally the value added tax (“VAT”) rate is 3 6 | ||
Foreign currency translation adjustment, description | Asset and liability accounts at March 31, 2018 and December 31, 2017 were translated at 6.2881 RMB to $1.00 and at 6.5063 RMB to $1.00, respectively, which were the exchange rates on the balance sheet dates. Equity accounts were stated at their historical rates. The average translation rates applied to the statements of operations for the three months ended March 31, 2018 and 2017 were 6.3714 RMB and 6.8925 RMB to $1.00, respectively. Cash flows from the Company's operations are calculated based upon the local currencies using the average translation rate. | ||
Concentration risk, percentage | 10.00% | 10.00% |
Other Receivable (Details)
Other Receivable (Details) - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 |
Other Receivable (Textual) | ||
Other receivable amount | $ 84,104 | $ 19,327 |
Security Deposit (Details)
Security Deposit (Details) | 3 Months Ended | ||
Mar. 31, 2018USD ($) | Mar. 31, 2018CNY (¥) | Dec. 31, 2017USD ($) | |
Security Deposit (Textual) | |||
Security Deposit | $ 75,170 | $ 72,649 | |
Beijing Jiuyuan [Member] | |||
Security Deposit (Textual) | |||
Security Deposit | $ 75,000 | ¥ 472,678 | |
Lease expires date | May 21, 2019 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 |
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 182,966 | $ 176,830 |
Less: accumulated depreciation | (155,648) | (141,497) |
Total | 27,318 | 35,333 |
Office furniture [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 24,993 | 24,155 |
Computer and office equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 43,387 | 41,932 |
Vehicles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 114,586 | $ 110,743 |
Property and Equipment (Detai32
Property and Equipment (Details Textual) - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Property and Equipment (Textual) | ||
Depreciation expenses | $ 9,120 | $ 13,910 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 |
Related Party Transaction [Line Items] | ||
Amount due from related parties | $ 172,156 | $ 75,301 |
Xiangbin Meng - Fees Receivable [Member] | ||
Related Party Transaction [Line Items] | ||
Amount due from related parties | 97,997 | 3,444 |
Jiuyuan [Member] | ||
Related Party Transaction [Line Items] | ||
Amount due from related parties | 20,873 | 20,204 |
Beijing Hengjiu [Member] | ||
Related Party Transaction [Line Items] | ||
Amount due from related parties | $ 53,286 | $ 51,653 |
Related Party Transactions (D34
Related Party Transactions (Details 1) - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 |
Related Party Transaction [Line Items] | ||
Amount due to related parties | $ 16,551 | $ 23,682 |
Jiucheng Huijin [Member] | ||
Related Party Transaction [Line Items] | ||
Amount due to related parties | 2,601 | 10,199 |
Beijing Jiuyuan [Member] | ||
Related Party Transaction [Line Items] | ||
Amount due to related parties | 2,545 | 2,460 |
Jiuxiang [Member] | ||
Related Party Transaction [Line Items] | ||
Amount due to related parties | 6,298 | 6,087 |
Yangming [Member] | ||
Related Party Transaction [Line Items] | ||
Amount due to related parties | $ 5,107 | $ 4,936 |
Related Party Transactions (D35
Related Party Transactions (Details 2) - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Related Party Transaction [Line Items] | ||
Beginning balance | $ (51,619) | $ (12,791,276) |
Operating activities - Due from related parties | 93,011 | 339,256 |
Financing activities - Repayments to related parties | (7,848) | |
Operating activities - Due to related parties | 3,660 | |
Investing activities - Working capital advances to related parties | 9,165,199 | |
Investing activities - Repayments from related parties | 6,407,007 | |
Financing activities - Advances from related parties | 3,546,849 | |
Non-cash Capital reduction | 11,606,777 | |
Internal transfers | ||
Effect of foreign currency exchange | (3,127) | (125,842) |
Ending balance | (155,605) | (857,280) |
Jiuyuan [Member] | ||
Related Party Transaction [Line Items] | ||
Beginning balance | (20,204) | 378,950 |
Operating activities - Due from related parties | 31 | |
Financing activities - Repayments to related parties | ||
Operating activities - Due to related parties | 3,600 | |
Investing activities - Working capital advances to related parties | (9,165,199) | |
Investing activities - Repayments from related parties | 5,415,895 | |
Financing activities - Advances from related parties | 3,576,355 | |
Non-cash Capital reduction | 8,124,744 | |
Internal transfers | (8,174,148) | |
Effect of foreign currency exchange | (700) | 2,697 |
Ending balance | (20,873) | 162,954 |
Meng [Member] | ||
Related Party Transaction [Line Items] | ||
Beginning balance | (11,311,447) | |
Operating activities - Due from related parties | ||
Financing activities - Repayments to related parties | ||
Investing activities - Repayments from related parties | 991,112 | |
Financing activities - Advances from related parties | (29,506) | |
Non-cash Capital reduction | 3,482,033 | |
Internal transfers | 6,953,828 | |
Effect of foreign currency exchange | (115,497) | |
Ending balance | (29,477) | |
Meng Receivable [Member] | ||
Related Party Transaction [Line Items] | ||
Beginning balance | (3,444) | 1,877,130 |
Operating activities - Due from related parties | (93,199) | (315,707) |
Financing activities - Repayments to related parties | ||
Operating activities - Due to related parties | ||
Investing activities - Working capital advances to related parties | ||
Investing activities - Repayments from related parties | ||
Financing activities - Advances from related parties | ||
Internal transfers | 1,220,320 | |
Effect of foreign currency exchange | (1,354) | (13,186) |
Ending balance | (97,997) | (985,703) |
Yasheng [Member] | ||
Related Party Transaction [Line Items] | ||
Beginning balance | 8,917 | |
Operating activities - Due from related parties | ||
Financing activities - Repayments to related parties | ||
Operating activities - Due to related parties | ||
Investing activities - Working capital advances to related parties | ||
Investing activities - Repayments from related parties | ||
Financing activities - Advances from related parties | ||
Effect of foreign currency exchange | 59 | |
Ending balance | 8,976 | |
Jiucheng Huijin [Member] | ||
Related Party Transaction [Line Items] | ||
Beginning balance | 10,199 | 5,867 |
Operating activities - Due from related parties | (20,950) | |
Financing activities - Repayments to related parties | (7,848) | |
Investing activities - Working capital advances to related parties | ||
Investing activities - Repayments from related parties | ||
Effect of foreign currency exchange | 250 | 59 |
Ending balance | 2,601 | (15,024) |
Beijing Jiuyuan [Member] | ||
Related Party Transaction [Line Items] | ||
Beginning balance | 2,460 | 2,304 |
Operating activities - Due from related parties | (2,322) | |
Financing activities - Repayments to related parties | ||
Operating activities - Due to related parties | 2,409 | |
Investing activities - Working capital advances to related parties | ||
Investing activities - Repayments from related parties | ||
Financing activities - Advances from related parties | ||
Effect of foreign currency exchange | 85 | 18 |
Ending balance | 2,545 | |
Jiuxiang [Member] | ||
Related Party Transaction [Line Items] | ||
Beginning balance | 6,087 | 1,263 |
Operating activities - Due from related parties | (277) | |
Financing activities - Repayments to related parties | ||
Operating activities - Due to related parties | 1,320 | |
Investing activities - Working capital advances to related parties | ||
Investing activities - Repayments from related parties | ||
Financing activities - Advances from related parties | ||
Effect of foreign currency exchange | 211 | 8 |
Ending balance | 6,298 | 994 |
Beijing Hengjiu [Member] | ||
Related Party Transaction [Line Items] | ||
Beginning balance | (51,653) | |
Operating activities - Due from related parties | 157 | |
Financing activities - Repayments to related parties | ||
Operating activities - Due to related parties | ||
Investing activities - Working capital advances to related parties | ||
Investing activities - Repayments from related parties | ||
Financing activities - Advances from related parties | ||
Effect of foreign currency exchange | (1,790) | |
Ending balance | (53,286) | |
Yangming [Member] | ||
Related Party Transaction [Line Items] | ||
Beginning balance | 4,936 | |
Operating activities - Due from related parties | ||
Financing activities - Repayments to related parties | ||
Operating activities - Due to related parties | ||
Investing activities - Working capital advances to related parties | ||
Investing activities - Repayments from related parties | ||
Financing activities - Advances from related parties | ||
Effect of foreign currency exchange | 171 | |
Ending balance | $ 5,107 |
Related Party Transactions (D36
Related Party Transactions (Details Textual) | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||
Jun. 30, 2016USD ($)Vehicles | Jun. 30, 2016CNY (¥)Vehicles | Oct. 21, 2015USD ($) | Oct. 21, 2015CNY (¥) | Mar. 31, 2018USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2017USD ($) | |
Related Party Transactions (Textual) | |||||||
Due from related party | $ 75,301 | ||||||
Owners percentage | 100.00% | ||||||
Related party due reduced | $ 11,519,905 | ||||||
Gain from extinguishment of liability | $ 14,299 | ||||||
Payment for monthly rental fee | $ 81,000 | ¥ 540,534 | |||||
General and administrative expenses paid | 407,134 | 266,934 | |||||
Working capital advances to related parties | 9,165,199 | ||||||
Meng [Member] | |||||||
Related Party Transactions (Textual) | |||||||
Number of vehicles lease | Vehicles | 2 | 2 | |||||
Meng [Member] | Service revenue [Member] | |||||||
Related Party Transactions (Textual) | |||||||
Due from related party | 97,997 | $ 3,444 | |||||
Jiuyuan [Member] | |||||||
Related Party Transactions (Textual) | |||||||
Working capital advances | 0 | 165,199 | |||||
Repayment of debt received | 0 | 5,415,895 | |||||
Due from related party | $ 20,873 | 20,204 | |||||
Owners percentage | 70.00% | ||||||
Payment for working capital | $ 31 | 3,660 | |||||
Working capital advance received | 0 | 3,576,355 | |||||
Due to related party | 378,950 | ||||||
Working capital advances to related parties | (9,165,199) | ||||||
Beijing Hengjiu [Member] | |||||||
Related Party Transactions (Textual) | |||||||
Working capital advances | 157 | 0 | |||||
Due from related party | $ 53,286 | 51,653 | |||||
Related party owned rate, description | Beijing Hengjiu is 75% owned by Jiuyuan and 25% owned by Meng. | ||||||
Working capital advances to related parties | |||||||
Yasheng [Member] | |||||||
Related Party Transactions (Textual) | |||||||
Working capital advances to related parties | |||||||
Jiucheng Huijin [Member] | |||||||
Related Party Transactions (Textual) | |||||||
Due to related party | $ 10,199 | 5,867 | |||||
Related party owned rate, description | Jiucheng Huijin is 30% owned by Meng. | ||||||
Related party due payable | $ 2,601 | 10,199 | |||||
Lease expires date | Jun. 30, 2017 | Jun. 30, 2017 | |||||
Payment for monthly rental fee | $ 3,600 | ¥ 25,000 | |||||
Rental income | $ 7,848 | 21,763 | |||||
Working capital advances to related parties | |||||||
Beijing Jiuyuan [Member] | |||||||
Related Party Transactions (Textual) | |||||||
Related party owned rate, description | Beijing Jiuyuan is 51% owned by Meng. | ||||||
Lease expires date | May 21, 2019 | ||||||
Rent expense | $ 2,545 | 2,545 | 2,460 | ||||
Working capital advances to related parties | |||||||
Jiuxiang [Member] | |||||||
Related Party Transactions (Textual) | |||||||
Related party owned rate, description | Jiuxiang is 75% owned by Jiuyuan. | ||||||
Payment for monthly rental fee | $ 74,000 | ¥ 491,168 | |||||
Rent expense | $ 6,298 | 6,087 | |||||
Working capital advances to related parties | |||||||
Yangming [Member] | |||||||
Related Party Transactions (Textual) | |||||||
Related party owned rate, description | Yangming owns 26.3% of the Company. | ||||||
General and administrative expenses paid | $ 5,107 | $ 4,936 | |||||
Working capital advances to related parties |
Other Payable (Details)
Other Payable (Details) - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 |
Other Payable [Abstract] | ||
Social security and provident fund payable | $ 206,096 | $ 44,254 |
Salary payable | 61,082 | 64,653 |
Other levies | 12,624 | 24,186 |
Total | $ 279,802 | $ 133,093 |
VAT Payable (Details)
VAT Payable (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Vat Payable (Textual) | |||
VAT payable | $ 104,881 | $ 195,308 | |
Percentage of revenue | 10.00% | 10.00% | |
Revenue [Member] | |||
Vat Payable (Textual) | |||
Percentage of revenue | 6.00% | ||
Percentage of car leasing | 3.00% |
Statutory Reserve (Details)
Statutory Reserve (Details) | 3 Months Ended |
Mar. 31, 2018 | |
Statutory Reserve (Textual) | |
Statutory surplus reserve fund, description | Subject to certain cumulative limits, the "statutory surplus reserve fund" requires annual appropriations of 10% of after-tax profit until the aggregated appropriations reach 50% of the registered capital (as determined under accounting principles generally accepted in the PRC ("PRC GAAP") at each year-end). |
Equity Transactions (Details)
Equity Transactions (Details) - 3 months ended Mar. 31, 2018 | USD ($) | CNY (¥) |
Formation | $ 16,002,704 | ¥ 100,000,000 |
Capital Reduction | (11,519,905) | (80,000,000) |
After Reduction | $ 4,482,799 | ¥ 20,000,000 |
Ownership Percentage | 100.00% | 100.00% |
Owners percentage | 100.00% | 100.00% |
Meng [Member] | ||
Formation | $ 4,800,811 | ¥ 30,000,000 |
Capital Reduction | (3,455,971) | (24,000,000) |
After Reduction | $ 1,344,840 | ¥ 6,000,000 |
Ownership Percentage | 30.00% | 30.00% |
Owners percentage | 30.00% | 30.00% |
Jiuyuan [Member] | ||
Formation | $ 11,201,893 | ¥ 70,000,000 |
Capital Reduction | (8,063,934) | (56,000,000) |
After Reduction | $ 3,137,959 | ¥ 14,000,000 |
Ownership Percentage | 70.00% | 70.00% |
Owners percentage | 70.00% | 70.00% |
Equity Transactions (Details Te
Equity Transactions (Details Textual) | Nov. 10, 2017shares | Mar. 31, 2018USD ($)shares | Mar. 31, 2018CNY (¥)shares | Dec. 31, 2017USD ($)shares | Mar. 31, 2017USD ($) | Feb. 28, 2017USD ($) | Feb. 28, 2017CNY (¥) | Feb. 15, 2017USD ($) | Feb. 15, 2017CNY (¥) |
Equity Transactions (Textual) | |||||||||
Reverse merger description | The holders of the Company's common stock as of immediately prior to the Merger held an aggregate of 5,110,000 shares and in connection with the Share Exchange Agreement, the Company's former majority shareholder, Kimho Consultants Company Limited, ("Kimho" or the "Majority Shareholder") entered into a share cancellation agreement with I JIU JIU's stockholders whereby Kimho, owning an aggregate of 4,000,000 shares of the Company's Common Stock agreed to cancel all its 4,000,000 shares of Common Stock in exchange of $440,000 paid by I JIU JIU's stockholders ("Share Cancellation"). | ||||||||
Reduction contributed capital on shareholders | $ 4,482,800 | ¥ 20,000,000 | |||||||
Common shares of capital stock issued | shares | 8,000,000 | 8,000,000 | |||||||
Reverse stock split | 160-for-1 | ||||||||
Common stock, authorized | shares | 75,000,000 | 75,000,000 | 75,000,000 | ||||||
Subscription receivable | $ | $ 51,289 | $ 51,289 | |||||||
Meng [Member] | |||||||||
Equity Transactions (Textual) | |||||||||
Contributed capital amount | 4,800,811 | ¥ 30,000,000 | $ 8,112,967 | ¥ 56,340,519 | |||||
Reduction contributed capital on shareholders | $ | $ 0 | $ 11,519,905 | |||||||
Jiuyuan [Member] | |||||||||
Equity Transactions (Textual) | |||||||||
Contributed capital amount | 11,201,893 | 70,000,000 | |||||||
Beijing Jiucheng [Member] | |||||||||
Equity Transactions (Textual) | |||||||||
Contributed capital amount | $ 16,002,704 | ¥ 100,000,000 | |||||||
Reduction contributed capital on shareholders | $ 16,002,704 | ¥ 100,000,000 |
Commitments and Contingencies42
Commitments and Contingencies (Details) | Mar. 31, 2018USD ($) | |
Operating Lease Type [Line Items] | ||
2,018 | $ 293,764 | |
2,019 | 117,185 | |
2,020 | 4,393 | |
2,021 | 3,661 | |
2,022 | ||
Total minimum lease payments | 419,003 | |
Allocated Lease [Member] | ||
Operating Lease Type [Line Items] | ||
2,018 | 4,393 | [1] |
2,019 | 4,393 | [1] |
2,020 | 4,393 | [1] |
2,021 | 3,661 | [1] |
2,022 | [1] | |
Total minimum lease payments | 16,840 | [1] |
Non-Cancellable Lease [Member] | ||
Operating Lease Type [Line Items] | ||
2,018 | 289,371 | [2] |
2,019 | 112,792 | [2] |
2,020 | [2] | |
2,021 | [2] | |
2,022 | [2] | |
Total minimum lease payments | $ 402,163 | [2] |
[1] | These are the Company's portion of minimum lease payments allocated by the Company's affiliated company, Jiuxiang, the leasee. | |
[2] | These are the minimum lease payments under the non-cancellable lease entered with a third party. |
Commitments and Contingencies43
Commitments and Contingencies (Details Textual) | Jan. 01, 2015USD ($) | May 22, 2017USD ($) | May 22, 2017CNY (¥) | Oct. 21, 2015USD ($) | Oct. 21, 2015CNY (¥) |
Commitments and Contingencies (Textual) | |||||
Payment for monthly rent | $ 81,000 | ¥ 540,534 | |||
Chaoyang Lease [Member] | |||||
Commitments and Contingencies (Textual) | |||||
Lease expires date | Oct. 20, 2021 | Oct. 20, 2021 | |||
Operating lease term | 6 years | 6 years | |||
Jiuxiang [Member] | |||||
Commitments and Contingencies (Textual) | |||||
Payment for monthly rent | $ 74,000 | ¥ 491,168 | |||
Xizhimen Lease [Member] | |||||
Commitments and Contingencies (Textual) | |||||
Lease expires date | May 31, 2017 | May 21, 2019 | May 21, 2019 | ||
Payment for monthly rent | $ 20,000 | ¥ 142,241 | |||
Payment of lease amount | $ 24,000 | ||||
Monthly maintenance fee | $ 2,200 | ¥ 15,318 |
Subsequent Event (Details)
Subsequent Event (Details) - 1 months ended Apr. 23, 2018 - Subsequent Event [Member] - Jiuyuan [Member] $ in Thousands | USD ($) | CNY (¥) |
Subsequent Event (Textual) | ||
Description of loan agreement | The Company, Jiuyuan, entered into a loan agreement with Jiucheng to borrow 15,000,000 RMB (approximately $2.39 million). The loan matures in six months with a monthly interest rate of 0.3625%. | |
Borrowing amount of loan | $ 2,390 | ¥ 15,000,000 |