| Summary of Significant Accounting Policies | 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accompanying consolidated financial statements
reflect the application of certain significant accounting policies as described in this note and elsewhere in the accompanying
consolidated financial statements and notes. Basis of presentation These accompanying consolidated financial statements
have been prepared in accordance with generally accepted accounting principles in the United States of America (“US GAAP”). Basis of consolidation The condensed consolidated financial statements
include the accounts of the Company and its subsidiaries in which the Company is the primary beneficiary. All inter-company accounts
and transactions have been eliminated upon consolidation. Use of estimates In preparing these consolidated financial statements,
management makes estimates and assumptions that affect the reported amounts of assets and liabilities in the balance sheets, and
revenues and expenses during the periods reported. Actual results may differ from these estimates. Cash and cash equivalents Cash and cash equivalents are carried at cost
and represent cash on hand, time deposits placed with banks or other financial institutions and all highly liquid investments with
an original maturity of six months or less as of the purchase date of such investments. Property and equipment Property and equipment
are stated at cost less accumulated depreciation and impairment. Depreciation of plant, equipment and software are calculated on
the straight-line method over their estimated useful lives or lease terms generally as follows:
Classification Estimated useful lives
Computer and software 5 years
Furniture and Fittings 5 years
Office equipment 10 years
Motor vehicle 5 years
Renovation 5 years Intangible assets Intangible assets
are stated at cost less accumulated amortization. Intangible assets represented the registration costs of trademarks in Malaysia
and Hong Kong which are amortized on a straight-line basis over a useful life of ten years. The Company follows ASC Topic 350 in accounting
for intangible assets, which requires impairment losses to be recorded when indicators of impairment are present and the undiscounted
cash flows estimated to be generated by the assets are less than the assets’ carrying amounts. There were no impairment losses
recorded on intangible assets for the year ended December 31, 2018. Finance leases Leases that transfer substantially all the
rewards and risks of ownership to the lessee, other than legal title, are accounted for as finance leases. Substantially all of
the risks or benefits of ownership are deemed to have been transferred if any one of the four criteria is met: (i) transfer of
ownership to the lessee at the end of the lease term, (ii) the lease containing a bargain purchase option, (iii) the lease term
exceeding 75% of the estimated economic life of the leased asset, (iv) the present value of the minimum lease payments exceeding
90% of the fair value. At the inception of a finance lease, the Company as the lessee records an asset and an obligation at an
amount equal to the present value of the minimum lease payments. The leased asset is amortized over the shorter of the lease term
or its estimated useful life if title does not transfer to the Company, while the leased asset is depreciated in accordance with
the Company’s depreciation policy if the title is to eventually transfer to the Company. The periodic rent payments made
during the lease term are allocated between a reduction in the obligation and interest element using the effective interest method
in accordance with the provisions of ASC Topic 835-30, “Imputation of Interest”. Inventories Inventories consisting of products available
for sell, are stated at the lower of cost or market value. Cost of inventory is determined using the first-in, first-out (FIFO)
method. Inventory reserve is recorded to write down the cost of inventory to the estimated market value due to slow-moving merchandise
and damaged goods, which is dependent upon factors such as historical and forecasted consumer demand, and promotional environment.
The Company takes ownership, risks and rewards of the products purchased. Write downs are recorded in cost of revenues in the Condensed
Consolidated Statements of Operations and Comprehensive Income. Revenue recognition In accordance with
ASC Topic 605, “Revenue Recognition”, the Company recognizes revenue from sales of goods when the following four revenue
criteria are met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred; (3) selling price is fixed or determinable;
and (4) collectability is reasonably assured. Revenue from trading
of retail goods is recognized when title and risk of loss are transferred and there are no continuing obligations to the customer.
Title and the risks and rewards of ownership transfer to and accepted by the customer when the products are collected by the customer
at the Company’s office. Revenue is recorded net of sales discounts, returns, allowances, and other adjustments that are
based upon management’s best estimates and historical experience and are provided for in the same period as the related revenues
are recorded. Based on limited operating history, management estimates that there was no sale return for the period reported. The Company mainly
derives its revenue from the sale of healthy food products. Generally, the Company recognizes revenue when products are sold and
accepted by the customers and there are no continuing obligations to the customer. Cost of revenue Cost of revenue includes the purchase cost
of retail goods for re-sale to customers and packing materials (such as boxes). It excludes purchasing and receiving costs, inspection
costs, warehousing costs, internal transfer costs and other costs of distribution network in cost of revenues. Shipping and handling
fees Shipping and handling fees, if billed to customers,
are included in revenue. Shipping and handling fees associated with inbound and outbound freight are expensed as incurred and included
in selling and distribution expenses. Selling and distribution
expenses Selling and distribution expenses are primarily
comprised of travelling and accommodation, transportation fees such as petrol, toll and parking and shipping and handling fees. Income taxes The provision of income taxes is determined
in accordance with the provisions of ASC Topic 740, “Income Taxes” (“ASC 740”). Under this method, deferred
tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured
using enacted income tax rates expected to apply to taxable income in the periods in which those temporary differences are expected
to be recovered or settled. Any effect on deferred tax assets and liabilities of a change in tax rates is recognized in income
in the period that includes the enactment date. ASC 740 prescribes a comprehensive model for
how companies should recognize, measure, present, and disclose in their financial statements uncertain tax positions taken or expected
to be taken on a tax return. Under ASC 740, tax positions must initially be recognized in the financial statements when it is more
likely than not the position will be sustained upon examination by the tax authorities. Such tax positions must initially and subsequently
be measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon ultimate settlement
with the tax authority assuming full knowledge of the position and relevant facts. The Company conducts much of its businesses
activities in Hong Kong and is subject to tax in this jurisdiction. As a result of its business activities, the Company will file
separate tax returns that are subject to examination by the foreign tax authorities. Net loss per share The Company calculates net loss per share in
accordance with ASC Topic 260 “ Earnings per share Foreign currencies translation Transactions denominated in currencies other
than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction.
Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional
currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the
Condensed Consolidated Statements of Operations and Comprehensive Income The reporting currency of the Company is United
States Dollars (“US$”) and the accompanying financial statements have been expressed in US$. In addition, the Company’s
subsidiaries and VIEs in Malaysia, Hong Kong, China and Thailand maintains their books and record in their local currency, Ringgits
Malaysia (“MYR”), Hong Kong Dollars (“HK$”), Chinese Renminbi (“RMB”) and Thai Baht (“THB”)
respectively, which is functional currency as being the primary currency of the economic environment in which the entity operates. In general, for consolidation purposes, assets
and liabilities of its subsidiaries whose functional currency is not US$ are translated into US$, in accordance with ASC Topic
830-30, “ Translation of Financial Statement” Translation of amounts from MYR into US$1,
HK$ into US$1, RMB into US$1 and THB into US$1 has been made at the following exchange rates for the respective periods:
As of and for the year ended December 31,
2018 2017
Period-end MYR : US$1 exchange rate 4.13 4.06
Period-average MYR : US$1 exchange rate 4.17 4.16
Period-end HK$ : US$1 exchange rate 7.83 7.82
Period-average HK$ : US$1 exchange rate 7.83 7.81
Period-end RMB : US$1 exchange rate 6.88 6.51
Period-average RMB : US$1 exchange rate 6.91 6.61
Period-end THB : US$1 exchange rate 32.35 32.61
Period-average THB : US$1 exchange rate 32.74 32.93 Related parties Parties, which can be a corporation or individual,
are considered to be related if the Company has the ability, directly or indirectly, to control the other party or exercise significant
influence over the other party in making financial and operating decisions. Companies are also considered to be related if they
are subject to common control or common significant influence. Fair value of financial instruments: The carrying value of the Company’s financial
instruments: cash and cash equivalents, subscription receivables, prepayment and deposits, accounts payable, and other payables
and accrued liabilities approximate at their fair values because of the short-term nature of these financial instruments. The Company also follows the guidance of the
ASC Topic 820-10, “ Fair Value Measurements and Disclosures
Level 1: Observable inputs such as quoted prices in active markets;
Level 2: Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and
Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions. Fair value estimates are made at a specific
point in time based on relevant market information about the financial instrument. These estimates are subjective in nature and
involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions
could significantly affect the estimates. Recent accounting pronouncements The Company has reviewed all recently issued,
but not yet effective, accounting pronouncements and do not believe the future adoption of such any pronouncements may be expected
to cause a material impact on its financial condition or the results of its operations, as follow: In May 2014, the FASB issued Accounting Standards
Update No. 2014-09, “Revenue from Contracts with Customers” (“ASU 2014-09”). ASU 2014-09 supersedes the
revenue recognition requirements in “Revenue Recognition (Topic 605)”, and requires entities to recognize revenue when
it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to
be entitled to in exchange for those goods or services. ASU 2014-09 is effective for annual reporting periods beginning after December
15, 2016, including interim periods within that reporting period. Early adoption is not permitted. In August 2015, the FASB issued
an Accounting Standards Update to defer by one year the effective dates of its new revenue recognition standard until annual reporting
periods beginning after December 15, 2017 (2018 for calendar-year public entities) and interim periods therein. Management is currently
assessing the impact of the adoption of ASU 2014-09 and has not determined the effect of the standard on our ongoing financial
reporting. In February 2016, the Financial Accounting
Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2016-02, Leases (Topic 842).
Under the new guidance, lessees will be required recognize the following for all leases (with the exception of short-term leases)
at the commencement date: 1) A lease liability, which is a lessee’s obligation to make lease payments arising from a lease,
measured on a discounted basis; and 2) A right-of-use asset, which is an asset that represents the lessee’s right to use,
or control the use of, a specified asset for the lease term. The new lease guidance simplified the accounting for sale and leaseback
transactions primarily because lessees must recognize lease assets and lease liabilities. Lessees will no longer be provided with
a source of off-balance sheet financing. The amendments in this ASU are effective for fiscal years beginning after December 15,
2019, including interim periods within those years. The Company is evaluating this ASU and has not determined the effect of this
standard on its ongoing financial reporting. In September 2017,
the FASB has issued ASU No. 2017-13, Revenue Recognition Revenue from Contracts with Customers Leases In January 2017, the FASB issued ASU No. 2017-01
, “Business Combinations (Topic 805): Clarifying the Definition of a Business”, which clarifies the definition of a
business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for
as acquisitions (or disposals) of assets or businesses. This amendment was effective for fiscal years beginning after December
15, 2017, and interim periods within those fiscal years. The adoption of ASU No. 2017-01 did not have a material impact on the
Company’s financial position, results of operations and liquidity. In September 2017, the FASB has issued ASU
No. 2017-13, Revenue Recognition (Topic 605), Revenue from Contracts with Customers (Topic 606), Leases (Topic 840), and Leases
(Topic 842): Amendments to SEC Paragraphs Pursuant to the Staff Announcement at the July 20, 2017 EITF Meeting and Rescission of
Prior SEC Staff Announcements and Observer Comments.” The amendments in ASU No. 2017-13 amends the early adoption date option
for certain companies related to the adoption of ASU No. 2014-09 and ASU No. 2016-02. Both of the below entities may still adopt
using the public company adoption guidance in the related ASUs, as amended. The effective date is the same as the effective date
and transition requirements for the amendments for ASU 2014-09 and ASU 2016-02. In February 2018, the FASB has issued ASU No.
2018-02, Income Statement-Reporting Comprehensive Income (Topic 220), which allows a reclassification from accumulated other comprehensive
income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act. Consequently, the amendments eliminate
the stranded tax effects resulting from the Tax Cuts and Jobs Act and will improve the usefulness of information in financial statement.
The amendments in this ASU are effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal
years. The Company has analyzed the consequences of such adoption and has not determined the effect of this standard on its ongoing
financial reporting. In August 2018, the FASB has issued ASU No.
2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements of Fair Value Measurement.
This amendment modifies the disclosure requirements on fair value measurements in Topic 820, Fair Value Measurement, based on the
concepts in the Concepts Statement, including the consideration of costs and benefits, with the primary purpose to improve the
effectiveness of disclosures in the notes to financial statements by facilitating clear communication of the information required
by US GAAP. The amendments in this update are effective for all entities for fiscal years, and interim periods within those fiscal
years, beginning after December 15, 2019. The Company has reviewed all recently issued,
but not yet effective, accounting pronouncements and does not believe the future adoption of any such pronouncements may be expected
to cause a material impact on its financial condition or the results of its operations. |
