Document And Entity Information
Document And Entity Information - shares | 9 Months Ended | |
Dec. 31, 2017 | Feb. 09, 2018 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Dec. 31, 2017 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 | |
Entity Registrant Name | Jerash Holdings (US), Inc. | |
Entity Central Index Key | 1,696,558 | |
Current Fiscal Year End Date | --03-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 9,895,000 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2017 | Mar. 31, 2017 |
Current Assets: | ||
Cash | $ 14,345,454 | $ 3,654,373 |
Accounts receivable | 6,755,128 | 2,776,314 |
Accounts receivable - related party | 90,751 | 2,343,892 |
Other receivable - related party | 0 | 336,746 |
Due from shareholders | 0 | 692,500 |
Inventories | 6,721,888 | 19,151,609 |
Advance to suppliers | 3,363,783 | 0 |
Prepaid expenses and other current assets | 1,206,103 | 1,303,230 |
Total Current Assets | 32,483,107 | 30,258,664 |
Restricted cash | 3,472,374 | 478,388 |
Property, plant and equipment, net | 2,988,418 | 3,160,242 |
Total Assets | 38,943,899 | 33,897,294 |
Current Liabilities: | ||
Credit facilities | 947,655 | 0 |
Accounts payable | 1,472,041 | 10,253,053 |
Accrued expenses | 534,148 | 464,476 |
Other payables | 962,531 | 1,161,975 |
Total Current Liabilities | 3,916,375 | 11,879,504 |
Total Liabilities | 3,916,375 | 11,879,504 |
Commitments and Contingencies | ||
Equity | ||
Preferred stock, $0.001 par value; 500,000 shares authorized; none issued and outstanding | 0 | 0 |
Common stock, $0.001 par value; 15,000,000 shares authorized; 9,895,000 shares and 8,787,500 shares issued and outstanding as of December 31, 2017 and March 31, 2017. | 9,895 | 8,788 |
Additional paid-in capital | 2,742,158 | 1,091,212 |
Statutory reserve | 71,699 | 71,699 |
Retained earnings | 31,928,688 | 20,537,889 |
Accumulated other comprehensive loss | (38,378) | (8,395) |
Total Shareholder's Equity | 34,714,062 | 21,701,193 |
Noncontrolling interest | 313,462 | 316,597 |
Total Equity | 35,027,524 | 22,017,790 |
Total Liabilities and Equity | $ 38,943,899 | $ 33,897,294 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2017 | Mar. 31, 2017 |
Preferred Stock, Par or Stated Value Per Share | $ 0.001 | $ 0.001 |
Preferred Stock, Shares Authorized | 500,000 | 500,000 |
Preferred Stock, Shares Issued | 0 | 0 |
Preferred Stock, Shares Outstanding | 0 | 0 |
Common Stock, Par or Stated Value Per Share | $ 0.001 | $ 0.001 |
Common Stock, Shares Authorized | 15,000,000 | 15,000,000 |
Common Stock, Shares, Issued | 9,895,000 | 8,787,500 |
Common Stock, Shares, Outstanding | 9,895,000 | 8,787,500 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME - USD ($) | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | |
Revenue, net from related party | $ 0 | $ 0 | $ 0 | $ 23,350,919 |
Revenue, net from third parties | 11,543,763 | 12,615,762 | 60,443,400 | 26,517,719 |
Revenue, net | 11,543,763 | 12,615,762 | 60,443,400 | 49,868,638 |
Cost of goods sold | 7,791,407 | 8,873,825 | 44,623,660 | 38,672,902 |
Gross Profit | 3,752,356 | 3,741,937 | 15,819,740 | 11,195,736 |
Selling, general and administrative expenses | 1,557,449 | 1,347,946 | 4,433,102 | 3,294,057 |
Total Operating Expenses | 1,557,449 | 1,347,946 | 4,433,102 | 3,294,057 |
Income from Operations | 2,194,907 | 2,393,991 | 11,386,638 | 7,901,679 |
Other Expense (Income): | ||||
Other expense (income), net | (12,244) | 4,032 | (1,316) | 28,463 |
Total other expense (income), net | (12,244) | 4,032 | (1,316) | 28,463 |
Net Income | 2,207,151 | 2,389,959 | 11,387,954 | 7,873,216 |
Net loss attributable to noncontrolling interest | 26 | 8,929 | 2,845 | 32,016 |
Net income attributable to Jerash Holdings (US), Inc.'s Common Shareholders | 2,207,177 | 2,398,888 | 11,390,799 | 7,905,232 |
Net Income | 2,207,151 | 2,389,959 | 11,387,954 | 7,873,216 |
Other Comprehensive Income (Loss): | ||||
Foreign currency translation loss | (53,817) | (14,659) | (30,273) | (54,065) |
Total Comprehensive Income | 2,153,334 | 2,375,300 | 11,357,681 | 7,819,151 |
Comprehensive loss attributable to noncontrolling interest | 515 | 9,846 | 3,135 | 33,746 |
Comprehensive Income Attributable to Jerash Holdings (US), Inc.'s Common Shareholders | $ 2,153,849 | $ 2,385,146 | $ 11,360,816 | $ 7,852,897 |
Earnings Per Share Attributable to Common Shareholders: | ||||
Basic and diluted | $ 0.23 | $ 0.27 | $ 1.18 | $ 0.9 |
Weighted Average Number of Shares: | ||||
Basic and diluted | 9,683,500 | 8,787,500 | 9,683,500 | 8,787,500 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) | Total | Preferred Stock [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Statutory Reserve [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Loss [Member] | Noncontrolling Interest [Member] |
Balance at Mar. 31, 2016 | $ 16,717,487 | $ 0 | $ 8,788 | $ 1,091,212 | $ 71,699 | $ 15,153,000 | $ 30,686 | $ 362,102 |
Balance (in shares) at Mar. 31, 2016 | 0 | 8,787,500 | ||||||
Net income (loss) | 7,873,216 | $ 0 | $ 0 | 0 | 0 | 7,905,232 | 0 | (32,016) |
Dividend Distribution | (5,307,500) | (5,307,500) | ||||||
Foreign currency translation loss | (54,065) | 0 | 0 | 0 | 0 | 0 | (52,335) | (1,730) |
Balance at Dec. 31, 2016 | 19,229,138 | $ 0 | $ 8,788 | 1,091,212 | 71,699 | 17,750,732 | (21,649) | 328,356 |
Balance (in shares) at Dec. 31, 2016 | 0 | 8,787,500 | ||||||
Balance at Mar. 31, 2017 | 22,017,790 | $ 0 | $ 8,788 | 1,091,212 | 71,699 | 20,537,889 | (8,395) | 316,597 |
Balance (in shares) at Mar. 31, 2017 | 0 | 8,787,500 | ||||||
Reverse recapitalization | 1,000 | $ 0 | $ 712 | 288 | 0 | 0 | 0 | 0 |
Reverse recapitalization (in shares) | 0 | 712,500 | ||||||
Private placement - common stock and warrants issued, net of stock issuance costs of $444,475 | 1,534,475 | $ 0 | $ 395 | 1,534,080 | 0 | 0 | 0 | 0 |
Private placement - common stock and warrants issued, net of stock issuance costs of $444,475 (in shares) | 0 | 395,000 | ||||||
Stock-based compensation expense for the warrant issued to the board observer | 116,578 | $ 0 | $ 0 | 116,578 | 0 | 0 | 0 | 0 |
Net income (loss) | 11,387,954 | 0 | 0 | 0 | 0 | 11,390,799 | 0 | (2,845) |
Foreign currency translation loss | (30,273) | 0 | 0 | 0 | 0 | 0 | (29,983) | (290) |
Balance at Dec. 31, 2017 | $ 35,027,524 | $ 0 | $ 9,895 | $ 2,742,158 | $ 71,699 | $ 31,928,688 | $ (38,378) | $ 313,462 |
Balance (in shares) at Dec. 31, 2017 | 0 | 9,895,000 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Parenthetical) | 9 Months Ended |
Dec. 31, 2017USD ($) | |
Adjustments to Additional Paid in Capital, Stock Issued, Issuance Costs | $ 444,475 |
CONDENSED CONSOLIDATED STATEME7
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 9 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net income | $ 11,387,954 | $ 7,873,216 |
Adjustments to reconcile net income to net cash (used in) provided by operating activities: | ||
Depreciation and amortization | 899,277 | 1,034,414 |
Stock-based compensation expense | 116,578 | 0 |
Changes in operating assets: | ||
Accounts receivable | (3,983,634) | (9,020,668) |
Accounts receivable - related party | 2,252,257 | 0 |
Inventories | 12,419,117 | 8,063,746 |
Advance to suppliers | (3,604,797) | 0 |
Prepaid expenses and other current assets | 95,979 | (113,561) |
Changes in operating liabilities: | ||
Accounts payable | (8,776,539) | 5,298,243 |
Accounts payable - related parties | 0 | (5,852,302) |
Accrued expenses | 70,138 | (22,793) |
Due to related parties | 0 | (344,696) |
Other payables | (198,487) | (370,503) |
Net cash provided by operating activities | 10,677,843 | 6,545,096 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Purchases of property, plant and equipment | (730,269) | (373,055) |
Other receivable - related party | 336,746 | 0 |
Net cash used in investing activities | (393,523) | (373,055) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Dividend distribution | (5,307,500) | |
Proceeds from short-term loan | 948,193 | 0 |
Due from shareholders | 692,500 | (692,500) |
Change in restricted cash | (2,996,128) | 0 |
Net proceeds from private placement | 1,772,845 | 0 |
Net cash provided by (used in) investing activities | 417,410 | (6,000,000) |
EFFECT OF EXCHANGE RATE CHANGES ON CASH | (10,649) | 11,041 |
NET INCREASE IN CASH | 10,691,081 | 183,082 |
CASH, BEGINNING OF THE PERIOD | 3,654,373 | 2,823,974 |
CASH, END OF THE PERIOD | 14,345,454 | 3,007,056 |
Non-cash financing activities | ||
Warrants issued to placement agent in connection with the private placement | 161,926 | 0 |
Prepaid stock issuance cost netted with proceeds from private placement | $ 239,105 | $ 0 |
ORGANIZATION AND DESCRIPTION OF
ORGANIZATION AND DESCRIPTION OF BUSINESS | 9 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block] | NOTE 1 ORGANIZATION AND DESCRIPTION OF BUSINESS Jerash Holdings (US), Inc. (“Jerash Holdings”) is a corporation established under the laws of the State of Delaware on January 20, 2016. Jerash Holdings is a parent holding company with no operations. Global Trend Investment Limited (“GTI”) was a limited company that was incorporated in the British Virgin Islands (“BVI”) on July 5, 2000, and was owned by two individuals and a BVI corporation, Merlotte Enterprise Limited, which was wholly owned by the Chairman of the Board of GTI and Jerash Garments and Fashions Manufacturing Company Limited (“Jerash Garments”). Previously, GTI was wholly-owned by Wealth Choice Limited (“WCL”), a BVI corporation, and the Chairman of the Board of Jerash Garments is also one of the beneficial owners of WCL and its subsidiaries. In September 2016, WCL transferred its ownership in GTI and its subsidiaries to Merlotte Enterprise Limited and an individual shareholder, and in October 2016, the individual shareholder transferred approximately 22 Jerash Garments is a wholly owned subsidiary of Jerash Holdings and was the wholly owned subsidiary of GTI prior to the Merger described below. Jerash Garments was established in Amman, the Hashemite Kingdom of Jordan (“Jordan”) as a limited liability company on November 26, 2000 with declared capital of 50,000 70,500 Jerash for Industrial Embroidery Company (“Jerash Embroidery”) and Chinese Garments and Fashions Manufacturing Company Limited (“Chinese Garments”) were both incorporated in Amman, Jordan as limited liability companies on March 11, 2013 and June 13, 2013, respectively, with declared capital of JOD 50,000 100 Victory Apparel (Jordan) Manufacturing Company Limited (“Victory Apparel”) was incorporated as a limited liability company in Amman, Jordan on September 18, 2005 with declared capital of JOD 50,000 Although Jerash Garments does not own the equity interest of Victory Apparel, our president, director and significant shareholder, Mr. Choi, is also a director of Victory Apparel and controls all decision-making for Victory Apparel along with our other significant shareholder, Mr. Lee Kian Tjiauw, who has the ability to control Victory Apparel’s financial affairs. In addition, Victory Apparel's equity at risk is not sufficient to permit it to operate without additional subordinated financial support from Mr. Choi. Based on these facts, we concluded that Jerash Garments has effective control over Victory Apparel due to Mr. Choi’s roles at both organizations, and therefore, Victory Apparel is considered a Variable Interest Entity (“VIE”) under Accounting Standards Codification (“ASC”) 810-10-05-08A. Accordingly, Jerash Garments consolidates Victory Apparel’s operating results, assets and liabilities. Treasure Success International Limited (“Treasure Success”) was incorporated on July 5, 2016 in Hong Kong, China, whose 100 On May 11, 2017, the shareholders of GTI contributed 100% of their outstanding capital stock in GTI to Jerash Holdings in exchange for an aggregate of 8,787,500 712,500 0.001 The Merger was accounted for as a reverse recapitalization. Under reverse capitalization accounting, GTI is recognized as the accounting acquirer, and Jerash Holdings is the legal acquirer or accounting acquiree. As such, following the Merger, the historical financial statements of GTI and its subsidiaries are treated as the historical financial statements of the combined company. Consequently, the consolidated financial statements of Jerash Holdings reflect the operations of the accounting acquirer and a recapitalization of the equity of the accounting acquirer. Jerash Holdings, its subsidiaries and VIE (herein collectively referred to as the “Company”) are engaged in manufacturing customized ready-made outerwear from knitted fabric and exporting produced apparel for large brand-name retailers. The Company is diversifying its range of products to include additional pieces such as trousers and urban styling outerwear and different types of natural and synthetic materials. The Company is also expanding its workforce in Jordan with workers from other countries, including Bangladesh, Sri Lanka, India, Myanmar and Nepal. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies [Text Block] | NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accompanying unaudited condensed consolidated financial statements of the Company have been prepared and presented in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures, which are normally included in annual financial statements prepared in accordance with U.S. GAAP, have been omitted pursuant to those rules and regulations. The unaudited interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto for the fiscal year ended March 31, 2017, included with the Company’s prospectus dated October 27, 2017 (File No. 333-218991). In the opinion of management, all adjustments (which include normal recurring adjustments) necessary to present a fair presentation of the Company's financial position as of December 31, 2017, its results of operations and its cash flows for the nine months ended December 31, 2017 and 2016, as applicable, have been made. The unaudited interim results of operations are not necessarily indicative of the operating results for the full fiscal year or any future periods. The unaudited condensed consolidated financial statements include the financial statements of Jerash Holdings, its subsidiaries and VIEs. All significant intercompany balances and transactions have been eliminated in consolidation. In accordance with accounting standards regarding consolidation of variable interest entities, VIEs are generally entities that lack sufficient equity to finance their activities without additional financial support from other parties or whose equity holders lack adequate decision-making ability. All VIEs with which the Company is involved must be evaluated to determine the primary beneficiary of the risks and rewards of the VIE. The primary beneficiary is required to consolidate the VIE for financial reporting purposes. As described in Note 1, management of the Company has concluded that Victory Apparel is a VIE, and that Jerash Garments is considered the primary beneficiary because Mr. Choi, our president, director and significant shareholder, absorbs the risks and rewards of Victory Apparel; therefore, we consolidate Victory Apparel for financial reporting purposes. Noncontrolling interests result from the consolidation of Victory Apparel, which is 100 December 31, 2017 March 31, 2017 Current assets $ 2,069 $ 2,096 Intercompany receivables* 311,393 321,317 Total assets 313,462 323,413 Third party current liabilities - (6,815) Total liabilities - (6,815) Net assets $ 313,462 $ 316,598 * Receivables from Jerash Garments are eliminated upon consolidation. Victory Apparel did not generate any income but incurred certain expenses for each of the nine-month periods ended December 31, 2017 and 2016. The loss was $ 26 8,929 2,845 32,016 The preparation of the unaudited condensed consolidated financial statements, in conformity with U.S. GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. The Company’s most significant estimates include allowance for doubtful accounts, valuation of inventory reserve and useful lives of buildings and other property. Actual results could differ from these estimates. The Company considers all highly liquid investment instruments with an original maturity of three months or less from the original date of purchase to be cash equivalents. As of December 31, 2017 and March 31, 2017 Restricted cash consists of cash used as security deposits to obtain credit facilities of the Company from a bank and to secure custom clearance under the requirements of local regulations. The Company is required to keep certain amounts on deposit that are subject to withdrawal restrictions. These security deposits at the bank are refundable only when the bank facilities are terminated. The restricted cash is classified as a non-current asset since the Company has no intention to terminate these bank facilities within one year. Accounts receivable are recognized and carried at the original invoiced amount less an estimated allowance for uncollectible accounts. The Company usually grants credit to customers with good credit standing for a maximum of 90 days and determines the adequacy of reserves for doubtful accounts based on individual account analysis and historical collection trends. The Company establishes a provision for doubtful receivables when there is objective evidence that the Company may not be able to collect amounts due. The allowance is based on management's best estimates of specific losses on individual exposures, as well as a provision on historical trends of collections. The provision is recorded against accounts receivables balances with a corresponding charge recorded in the consolidated statements of income and comprehensive income. Actual amounts received may differ from management's estimate of credit worthiness and the economic environment. Delinquent account balances are written off against the allowance for doubtful accounts after management has determined that the likelihood of collection is not probable. No allowance was considered necessary as of December 31, 2017 and March 31, 2017. Inventories are stated at the lower of cost or net realizable value. Inventories include cost of raw materials, freight, direct labor and related production overhead. The cost of inventories is determined using the First in, First-out (“FIFO”) method. The Company periodically reviews its inventories for excess or slow-moving items and makes provisions as necessary to properly reflect inventory value. Property, plant and equipment are recorded at cost, reduced by accumulated depreciation and amortization. Depreciation and amortization expense related to property, plant and equipment is computed using the straight-line method based on estimated useful lives of the assets, or in the case of leasehold improvements, the shorter of the initial lease term or the estimated useful life of the improvements. The useful life and depreciation method are reviewed periodically to ensure that the method and period of depreciation are consistent with the expected pattern of economic benefits from items of property, plant and equipment. Useful life Land Infinite Property and buildings 15 years Equipment and machinery 3-5 years Office and electronic equipment 3-5 years Automobiles 5 years Leasehold improvements Lesser of useful life and lease term Expenditures for maintenance and repairs, which do not materially extend the useful lives of the assets, are charged to expense as incurred. Expenditures for major renewals and betterments which substantially extend the useful life of assets are capitalized. The cost and related accumulated depreciation or amortization of assets retired or sold are removed from the respective accounts, and any gain or loss is recognized in the unaudited condensed consolidated statements of income and comprehensive income. The Company assesses its long-lived assets, including property and equipment, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset group may not be recoverable. Factors which may indicate potential impairment include a significant underperformance relative to the historical or projected future operating results or a significant negative industry or economic trend. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by that asset. If impairment is indicated, a loss is recognized for any excess of the carrying value over the estimated fair value of the asset. The fair value is estimated based on the discounted future cash flows or comparable market values, if available. The Company did not record any impairment loss during the three and nine months ended December 31, 2017 and 2016. Revenue from product sales is recognized, net of estimated provisions for sales allowances and returns, when the merchandise is shipped and title is transferred. Revenue is recognized when all four of the following criteria are met: (i) persuasive evidence that an arrangement exists (sales agreements and customer purchase orders are used to determine the existence of an arrangement); (ii) delivery of goods has occurred and risks and benefits of ownership have been transferred, which is when the goods are received by the customer at its designated location in accordance with the sales terms; (iii) the sales price is both fixed and determinable; and (iv) collectability is reasonably assured. Most of the Company’s products are custom-made for large brand-name retailers. Historically, sales returns have been minimal. Proceeds collected from customers for shipping and handling costs are included in revenues. Shipping and handling costs are expensed as incurred and are included in operating expenses, as a part of selling, general and administrative expenses. Total shipping and handling expenses were $ 111,205 117,387 508,204 420,820 The Company is subject to income taxes on an entity basis on income arising in or derived from the tax jurisdiction in which each entity is domiciled. Jerash Holdings was incorporated in the State of Delaware and is subject to Federal income tax in the United States of America. GTI was incorporated in the BVI and is not subject to income taxes under the current laws of BVI. Treasure Success was registered in Hong Kong and has no operating profit for current tax liabilities. Jerash Garments, Jerash Embroidery, Chinese Garments and Victory Apparel are subject to the regulations of the Income Tax Department in Jordan. The corporate income tax rate is 14 December 31, 2018 342,254 341,349 0.04 0.04 The exempted income tax expense for Jerash Garments totaled $ 1,675,086 1,118,768 0.17 0.13 Local sales of Jerash Garments are subject to income tax at a fixed rate of 14 The Company accounts for income taxes in accordance with ASC 740, “Income Taxes,” which requires the Company to use the asset and liability method of accounting for income taxes. Under the asset and liability method, deferred income taxes are recognized for the tax consequences of temporary differences by applying enacted statutory tax rates applicable to future years to differences between financial statement carrying amounts and the tax bases of existing assets and liabilities and operating loss and tax credit carry forwards. Under this accounting standard, the effect on deferred income taxes of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is recognized if it is more likely than not that some portion, or all of, a deferred tax asset will not be realized. Deferred income taxes were immaterial, and accordingly, no deferred tax assets or liabilities were recognized as of December 31, 2017 and March 31, 2017. ASC 740 clarifies the accounting for uncertainty in tax positions. This interpretation requires that an entity recognize in its financial statements the impact of a tax position if that position is more likely than not to be sustained upon examination, based on the technical merits of the position. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company has elected to classify interest and penalties related to unrecognized tax benefits, if and when required, as part of income tax expense in the consolidated statements of income and comprehensive income. Jordan income tax returns prior to 2013 are not subject to examination by any applicable tax authorities. No significant uncertainty in tax positions relating to income taxes have been incurred during the periods ended December 31, 2017 and 2016. The reporting currency of the Company is the U.S. dollar and the Company uses the JOD as its functional currency, except for Treasure Success, which uses the Hong Kong Dollar (“HKD”) as its functional currency. The assets and liabilities of the Company have been translated into U.S. dollars using the exchange rates in effect at the balance sheet date, equity accounts have been translated into U.S. dollars at historical rates, and revenue and expenses have been translated into U.S. dollars using average exchange rates in effect during the reporting period. Cash flows are also translated into U.S. dollars at average translation rates for the periods; therefore, amounts related to assets and liabilities reported on the consolidated statements of cash flows will not necessarily agree with changes in the corresponding balances on the consolidated balance sheets. Translation adjustments arising from the use of different exchange rates from period to period are included as a separate component of accumulated other comprehensive income (loss). 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. The value of the JOD against the U.S. dollar and other currencies may fluctuate and is affected by, among other things, changes in Jordan’s political and economic conditions. Any significant revaluation of the JOD may materially affect the Company’s financial condition in terms of reporting in U.S. dollars. March 31, 2017 December 31, 2016 Period-end spot rate US$1=JOD 0.7097 US$1=JOD 0.7090 US$1=JOD 0.7106 US$1=HKD 0.1282 US$1=HKD 0.1287 US$1=HKD 0.1289 Average rate US$1=JOD 0.7093 US$1=JOD 0.7086 US$1=JOD 0.7109 US$1=HKD 0.1280 US$1=HKD 0.1289 The Company measures compensation expense for stock-based awards to non-employee contractors and directors based upon the awards’ initial grant date fair value. The estimated grant date fair value of the award is recognized as expense over the requisite service period using the straight-line method. The fair value of awards to non-employees is then marked-to-market each reporting period until vesting criteria are satisfied. The Company estimates the fair value of stock warrants using the Black-Scholes model. This model is affected by the Company's stock price on the date of the grant as well as assumptions regarding a number of highly complex and subjective variables. These variables include the expected term of the warrant, the expected risk-free rates of return, the expected volatility of the Company's common stock, and the expected dividend yield, each of which is more fully described below. The assumptions for the expected term and the expected volatility are the two assumptions that significantly affect the grant date fair value. ⋅ Expected Term: the expected term of a warrant is the period of time that the warrant is expected to be outstanding. ⋅ Risk-free Interest Rate: the Company bases the risk-free interest rate used in the Black-Scholes model on the implied yield at the grant date of the U.S. Treasury zero coupon issue with an equivalent term to the stock-based award being valued. Where the expected term of a stock-based award does not correspond with the term for which a zero coupon interest rate is quoted, the Company uses the nearest interest rate from the available maturities. ⋅ Expected Stock Price Volatility: the Company utilizes comparable public company volatility over the same period of time as the life of the warrant. ⋅ Dividend Yield: because the Company does not expect to pay a dividend in the foreseeable future, a 0 The Company computes earnings per share (“EPS”) in accordance with ASC 260, “Earnings per Share” (“ASC 260”). ASC 260 requires companies with complex capital structures to present basic and diluted EPS. Basic EPS is measured as net income divided by the weighted average common shares outstanding for the period. Diluted EPS is similar to basic EPS but presents the dilutive effect of potential common shares (e.g., convertible securities, options and warrants) on a per share basis as if the convertible securities had been converted at the beginning of the period presented, or the issuance date, if later. Comprehensive income consists of two components, net income and other comprehensive income (loss). The foreign currency translation gain or loss resulting from the translation of the financial statements expressed in JOD or HKD to U.S. dollars is reported in other comprehensive income (loss) in the consolidated statements of income and comprehensive income. ASC 825-10 requires certain disclosures regarding the fair value of financial instruments. 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. A three-level fair value hierarchy prioritizes the inputs used to measure fair value. The hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows: ⋅ Level 1 - Quoted prices in active markets for identical assets and liabilities. ⋅ Level 2 - Quoted prices in active markets for similar assets and liabilities, or other inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. ⋅ Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs. The Company considered the recorded value of its financial assets and liabilities, which consist primarily of cash, including restricted cash, accounts receivable, other receivables, due from related parties, due from shareholders, accounts payable, accrued expenses, other payables and short-term loans, to approximate the fair value of the respective assets and liabilities at December 31, 2017 and March 31, 2017 based upon the short-term nature of these assets and liabilities. Credit risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash. As of December 31, 2017 and March 31, 2017, $ 5,355,745 3,404,508 8,988,963 249,865 746 0 250,000 Accounts receivable are typically unsecured and derived from revenue earned from customers and therefore, are exposed to credit risk. The risk is mitigated by the Company's assessment of its customers' creditworthiness and its ongoing monitoring of outstanding balances. Customer and vendor concentration risk Prior to August 2016, substantially all of the Company’s sales were made to its customers through its affiliates (see Note 7) that are located primarily in the United States (see Note 9). Thereafter, the Company began selling directly to its customers. The Company’s operating results could be adversely affected by U.S. government policy on exporting business, foreign exchange rate fluctuations, and change of local market conditions. The Company has a concentration of its revenues and purchases with specific customers and suppliers. For the three months ended December 31, 2017, two customers accounted for 72 12 81 8 80 10 81 77 11 94 For the three months ended December 31, 2017, the Company purchased approximately 62 12 87 83 ONSET For the nine months ended December 31, 2016, the Company purchased 44 9 45 96 A loss of any of these customers or suppliers could adversely affect the operating results or cash flows of the Company. The principal operations of the Company are located in Jordan. Accordingly, the Company’s business, financial condition, and results of operations may be influenced by the political, economic, and legal environments in Jordan, as well as by the general state of the Jordanian economy. The Company’s operations in Jordan are subject to special considerations and significant risks that are not typically associated with companies in North America. These include risks associated with, among others, the political, economic and legal environment and foreign currency exchange. The Company’s results may be adversely affected by changes in the political, regulatory and social conditions in Jordan. Although the Company has not experienced losses from these situations and believes that it is in compliance with existing laws and regulations, including its organization and structure disclosed in Note 1, this may not be indicative of future results. |
RECENT ACCOUNTING PRONOUNCEMENT
RECENT ACCOUNTING PRONOUNCEMENTS | 9 Months Ended |
Dec. 31, 2017 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
New Accounting Pronouncements and Changes in Accounting Principles [Text Block] | NOTE 3 - New Accounting Pronouncements Recently Adopted In July 2015, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2015-11, “Simplifying the Measurement of Inventory.” ASU No. 2015-11 changes the measurement principle for inventory from the lower of cost or market to the lower of cost and net realizable value. Net realizable value is defined as the estimated selling prices in the ordinary course of business; less reasonably predictable costs of completion, disposal and transportation. For public business entities, the amendments in this ASU are effective for fiscal years beginning after December 15, 2016, including interim reporting periods within those fiscal years. The Company adopted this guidance in the first quarter of its fiscal year ended March 31, 2018 using a prospective application. The adoption of this guidance did not have a material impact on the Company’s unaudited condensed consolidated financial statements and related disclosures. In March 2016, the FASB issued ASU 2016-09, “CompensationStock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting.” This update addresses several aspects of the accounting for share-based compensation transactions including: (a) income tax consequences when awards vest or are settled, (b) classification of awards as either equity or liabilities, (c) a policy election to account for forfeitures as they occur rather than on an estimated basis and (d) classification of excess tax impacts on the statement of cash flows. The Company adopted this guidance in the first quarter of its fiscal year ended March 31, 2018, which did not have a material impact to the unaudited condensed consolidated financial statements and related disclosures. The amendments requiring recognition of excess tax benefits and tax deficiencies in the income statement will be applied prospectively. The Company does not expect the impact to be material to the unaudited condensed consolidated results of operations; however, such determination is subject to change based on facts and circumstances at the time when awards vest or settle. New Accounting Pronouncements Not Yet Adopted In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”). ASU 2014-09 requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. ASU 2014-09 will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective and permits the use of either the retrospective or cumulative effect transition method. The guidance also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts. In August 2015, the FASB issued ASU No. 2015-14, “Deferral of the Effective Date” (“ASU 2015-14”), which defers the effective date for ASU 2014-09 by one year. The guidance in ASU 2014-09 will be effective for the Company for fiscal years beginning after December 15, 2017, including interim reporting periods within those fiscal years. In March 2016, the FASB issued ASU No. 2016-08, “Principal versus Agent Considerations (Reporting Revenue versus Net)” (“ASU 2016-08”), which clarifies the implementation guidance on principal versus agent considerations in the new revenue recognition standard. In April 2016, the FASB issued ASU No. 2016-10, “Identifying Performance Obligations and Licensing” (“ASU 2016-10”), which reduces the complexity when applying the guidance for identifying performance obligations and improves the operability and understandability of the license implementation guidance. In May 2016, the FASB issued ASU No. 2016-12 “Narrow-Scope Improvements and Practical Expedients” (“ASU 2016-12”), which amends the guidance on transition, collectability, noncash consideration and the presentation of sales and other similar taxes. Preliminarily, the Company plans to adopt Topic 606 using the retrospective transition method, and is continuing to evaluate the impact its pending adoption of Topic 606 will have on its consolidated financial statements. The Company believes that its current revenue recognition policies are generally consistent with the new revenue recognition standards set forth in ASU 2014-09. Potential adjustments to input measures are not expected to be pervasive to the majority of the Company’s contracts. While no significant impact is expected upon adoption of the new guidance, the Company will not be able to make that determination until the time of adoption based upon outstanding contracts at that time. In February 2016, the FASB issued ASU No. 2016-02, "Leases” to increase transparency and comparability among organizations by recognizing leased assets on the balance sheet with a corresponding liability and disclosing key information about leasing arrangements. For public business entities, the amendments in this ASU are effective for fiscal years beginning after December 15, 2018, including interim reporting periods within those fiscal years. For all other entities, the amendments in this ASU are effective for fiscal years beginning after December 15, 2019, and interim reporting periods within fiscal years beginning after December 15, 2020. Early adoption is permitted. The Company is evaluating the impact of the adoption of this revised guidance on its unaudited condensed consolidated financial statements and related disclosures. In May 2017, the FASB issued ASU 2017-09, “Scope of Modification Accounting,” which amends the scope of modification accounting for share-based payment arrangements, provides guidance on the types of changes to the terms or conditions of share-based payment awards to which an entity would be required to apply modification accounting under ASC 718. For all entities, the ASU is effective for annual reporting periods, including interim periods within those annual reporting periods, beginning after December 15, 2017. Early adoption is permitted, including adoption in any interim period. The Company does not expect that adoption of this guidance will have a material impact on its unaudited condensed consolidated financial statements and related disclosures. |
INVENTORIES
INVENTORIES | 9 Months Ended |
Dec. 31, 2017 | |
Inventory Disclosure [Abstract] | |
Inventory Disclosure [Text Block] | NOTE 4 INVENTORIES Inventories consisted of the following: As of As of December 31, 2017 March 31, 2017 Raw materials $ 3,205,286 $ 9,265,201 Work-in-progress 213,114 1,493,258 Finished goods 3,303,488 8,393,150 Total inventory $ 6,721,888 $ 19,151,609 An inventory allowance was not considered necessary as of December 31, 2017 and March 31, 2017. |
PROPERTY, PLANT AND EQUIPMENT,
PROPERTY, PLANT AND EQUIPMENT, NET | 9 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment Disclosure [Text Block] | NOTE 5 PROPERTY, PLANT AND EQUIPMENT, NET As of As of Land $ 61,022 $ 61,078 Property and buildings 432,163 432,562 Equipment and machinery 4,829,290 4,370,095 Office and electric equipment 503,953 472,918 Automobiles 358,116 302,714 Leasehold improvements 1,492,842 1,358,649 Subtotal 7,677,386 6,998,016 Construction in progress 230,363 206,246 Less: Accumulated Depreciation and Amortization (4,919,331) (4,044,020) Property and Equipment, Net $ 2,988,418 $ 3,160,242 Depreciation and amortization expense was $ 310,953 338,798 899,277 1,034,414 Construction in progress represents costs of construction incurred for the Company's new sewing workshop, a 450 |
EQUITY
EQUITY | 9 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Stockholders' Equity Note Disclosure [Text Block] | NOTE 6 EQUITY Preferred Stock The Company has 500,000 0.001 Statutory Reserve In accordance with the Corporate Law in Jordan, Jerash Garments, Jerash Embroidery, Chinese Garments and Victory Apparel are required to make appropriations to certain reserve funds, based on net income determined in accordance with generally accepted accounting principles of Jordan. Appropriations to the statutory reserve are required to be 10% of net income until the reserve is equal to 100% of the entity’s share capital. This reserve is not available for dividend distribution. As of both December 31, 2017 and March 31, 2017, the consolidated balance of the statutory reserve was $ 71,699 Private placement On May 15, 2017, the Company conducted the initial closing of a private placement for the sale of an aggregate of 540,000 54,000 270,000 4.99 270,000 0.01 6.25 1,352,700 379,828 On August 18, 2017, the Company conducted the second closing of a private placement, pursuant to which an aggregate of 200,000 20,000 100,000 4.99 100,000 0.01 6.25 450,910 On September 27, 2017, the Company conducted the third and final closing of a private placement, pursuant to which an aggregate of 50,000 5,000 25,000 4.99 25,000 0.01 6.25 110,179 Warrants issued for services From time to time, the Company issues warrants to purchase its common stock. These warrants are valued using a Black-Scholes model and using the volatility, market price, exercise price, risk-free interest rate and dividend yield appropriate at the date the warrants were issued. On May 15, 2017, Jerash Holdings issued warrants to the designees of the placement agent in the above private placement to purchase 48,600 6.25 5.50 107,990 On May 15, 2017, Jerash Holdings also issued a five-year warrant to purchase up to 50,000 5.00 116,578 0 On August 1, 2017, warrants to purchase 18,000 6.25 5.50 43,122 On September 27, 2017, warrants to purchase 4,500 6.25 5.50 10,814 During the quarter ended December 31, 2017, all of the outstanding warrants were fully vested and exercisable. Common Stock Warrants Expected term (in years) 5.0 Risk-free interest rate (%) 1.86 % Expected volatility (%) 52.2 % Dividend yield (%) 0.0 % Shares Weighted Average Warrants outstanding at March 31, 2017 - - Granted 207,210 $ 5.69 Exercised - - Cancelled - - Warrants outstanding at December 31, 2017 207,210 $ 5.69 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended |
Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Transactions Disclosure [Text Block] | NOTE 7 RELATED PARTY TRANSACTIONS Name of Related Party Relationship to the Company Nature of Transactions Ford Glory Holdings Limited (“FGH”) Working Capital Advances Ford Glory International Limited, or FGIL Affiliate, subsidiary of FGH Sales / Purchases Value Plus (Macao Commercial Offshore) Limited (“VPMCO”) Affiliate, subsidiary of FGH Purchases Jiangmen V-Apparel Manufacturing Limited Affiliate, subsidiary of FGH Working Capital Advances Wealth Choice Limited, or WCL Shareholder of Victory Apparel Working Capital Advances Pursuant to the terms of a sale and purchase agreement between one of the Company’s current individual shareholders and Victory City Investments Limited, the ultimate 51 Related party balances: a. Accounts receivable related party: Accounts receivable from a related party in connection with the collection of accounts receivable from its customers on behalf of the Company due to the support arrangement during the transition period as described below (see a. Sales to a related party) consisted of the following: As of As of FGIL $ 90,751 $ 2,343,892 b. Other receivables related party: As of As of WCL $ - $ 336,746 The balance due from WCL was interest-free and due upon demand. The balance as of March 31, 2017 was fully collected from WCL on June 15, 2017. c. Due from shareholders: As of As of Two individual shareholders $ - $ 353,175 Merlotte Enterprise Limited - 339,325 $ - $ 692,500 The balance as of March 31, 2017 was fully collected from shareholders on May 8, 2017. Related party transactions: a. Sales to a related party: For the three months ended December 31, 2017 2016 FGIL $ - $ - For the nine months ended December 31, 2017 2016 FGIL $ - $ 23,350,919 Pursuant to the Sale and Purchase Agreement, the Company has all rights, interests and benefits of the sales agreements signed with customers since August 2016, together with the costs and obligations of those agreements. During the transition period, the Company’s affiliate supported the Company to complete the transition with no additional fees charged. For the three months ended December 31, 2017, $ 1,809,475 43,994,497 b. Purchases from related parties: For the three months ended December 31, 2017 2016 VPMCO $ - $ - FGIL - - $ - $ - For the nine months ended December 31, 2017 2016 VPMCO $ - $ 5,144,675 FGIL - 916,527 $ - $ 6,061,202 |
CREDIT FACILITIES
CREDIT FACILITIES | 9 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Debt Disclosure [Text Block] | NOTE 8 CREDIT FACILITIES Pursuant to a letter agreement dated May 29, 2017, Treasure Success entered into an $ 8,000,000 12,000,000 3,000,000 1.5 1.5 947,655 |
SEGMENT REPORTING
SEGMENT REPORTING | 9 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
Segment Reporting Disclosure [Text Block] | NOTE 9 SEGMENT REPORTING ASC 280, “Segment Reporting,” establishes standards for reporting information about operating segments on a basis consistent with the Company's internal organizational structure as well as information about geographical areas, business segments and major customers in financial statements for details on the Company's business segments. The Company uses the “management approach” in determining reportable operating segments. The management approach considers the internal organization and reporting used by the Company’s chief operating decision maker for making operating decisions and assessing performance as the source for determining the Company’s reportable segments. Management, including the chief operating decision maker, reviews operation results by the revenue of the Company’s products. The Company’s major product is outerwear. For the three months ended December 31, 2017 and 2016, outerwear accounted for approximately 78.2 92.5 92 94.1 For the three months ended December 31, 2017 December 31, 2016 United States $ 8,495,713 $ 11,452,005 Jordan 2,518,993 949,031 Other countries 529,057 214,726 Total $ 11,543,763 $ 12,615,762 The following table summarizes sales by geographic areas for the nine months ended December 31, 2017 and 2016. For the nine months ended December 31, 2017 December 31, 2016 United States $ 54,835,203 $ 46,617,843 Jordan 4,826,158 2,958,579 Other countries 782,039 292,216 Total $ 60,443,400 $ 49,868,638 All long-lived assets were located in Jordan as of December 31, 2017 and March 31, 2017. The Company manufactures outerwear for all seasons. Products for Fall/Winter normally have higher fabric and accessories costs, and some of the styles are more complicated compared to products for Spring/Summer. The higher production costs for Fall/Winter typically result in higher sales and profit margins in the period from May to October in which products for Fall/Winter are primarily shipped. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies Disclosure [Text Block] | NOTE 10 COMMITMENTS AND CONTINGENCIES Rent Commitment The Company leases two manufacturing facilities under operating leases. Operating lease expense amounted to $ 319,156 281,589 949,120 846,089 Future minimum lease payments under non-cancelable operating leases are as follows: Twelve months ended December 31, 2018 $ 814,139 2019 11,079 2020 and thereafter - Total $ 825,218 The Company has nineteen operating leases for its facilities that require monthly payments ranging between $ 247 26,943 Contingencies From time to time, the Company is a party to various legal actions arising in the ordinary course of business. The Company accrues costs associated with these matters when they become probable and the amount can be reasonably estimated. Legal costs incurred in connection with loss contingencies are expensed as incurred. The Company’s management does not expect any liability from the disposition of such claims and litigation individually or in the aggregate would not have a material adverse impact on the Company’s consolidated financial position, results of operations and cash flows. |
SUMMARY OF SIGNIFICANT ACCOUN18
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Basis of Accounting, Policy [Policy Text Block] | Basis of presentation The accompanying unaudited condensed consolidated financial statements of the Company have been prepared and presented in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures, which are normally included in annual financial statements prepared in accordance with U.S. GAAP, have been omitted pursuant to those rules and regulations. The unaudited interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto for the fiscal year ended March 31, 2017, included with the Company’s prospectus dated October 27, 2017 (File No. 333-218991). In the opinion of management, all adjustments (which include normal recurring adjustments) necessary to present a fair presentation of the Company's financial position as of December 31, 2017, its results of operations and its cash flows for the nine months ended December 31, 2017 and 2016, as applicable, have been made. The unaudited interim results of operations are not necessarily indicative of the operating results for the full fiscal year or any future periods. |
Consolidation, Policy [Policy Text Block] | Principles of Consolidation The unaudited condensed consolidated financial statements include the financial statements of Jerash Holdings, its subsidiaries and VIEs. All significant intercompany balances and transactions have been eliminated in consolidation. In accordance with accounting standards regarding consolidation of variable interest entities, VIEs are generally entities that lack sufficient equity to finance their activities without additional financial support from other parties or whose equity holders lack adequate decision-making ability. All VIEs with which the Company is involved must be evaluated to determine the primary beneficiary of the risks and rewards of the VIE. The primary beneficiary is required to consolidate the VIE for financial reporting purposes. As described in Note 1, management of the Company has concluded that Victory Apparel is a VIE, and that Jerash Garments is considered the primary beneficiary because Mr. Choi, our president, director and significant shareholder, absorbs the risks and rewards of Victory Apparel; therefore, we consolidate Victory Apparel for financial reporting purposes. Noncontrolling interests result from the consolidation of Victory Apparel, which is 100 December 31, 2017 March 31, 2017 Current assets $ 2,069 $ 2,096 Intercompany receivables* 311,393 321,317 Total assets 313,462 323,413 Third party current liabilities - (6,815) Total liabilities - (6,815) Net assets $ 313,462 $ 316,598 * Receivables from Jerash Garments are eliminated upon consolidation. Victory Apparel did not generate any income but incurred certain expenses for each of the nine-month periods ended December 31, 2017 and 2016. The loss was $ 26 8,929 2,845 32,016 |
Use of Estimates, Policy [Policy Text Block] | Use of Estimates The preparation of the unaudited condensed consolidated financial statements, in conformity with U.S. GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. The Company’s most significant estimates include allowance for doubtful accounts, valuation of inventory reserve and useful lives of buildings and other property. Actual results could differ from these estimates. |
Cash and Cash Equivalents, Policy [Policy Text Block] | Cash The Company considers all highly liquid investment instruments with an original maturity of three months or less from the original date of purchase to be cash equivalents. As of December 31, 2017 and March 31, 2017 |
Cash and Cash Equivalents, Restricted Cash and Cash Equivalents, Policy [Policy Text Block] | Restricted Cash Restricted cash consists of cash used as security deposits to obtain credit facilities of the Company from a bank and to secure custom clearance under the requirements of local regulations. The Company is required to keep certain amounts on deposit that are subject to withdrawal restrictions. These security deposits at the bank are refundable only when the bank facilities are terminated. The restricted cash is classified as a non-current asset since the Company has no intention to terminate these bank facilities within one year. |
Trade and Other Accounts Receivable, Policy [Policy Text Block] | Accounts Receivable Accounts receivable are recognized and carried at the original invoiced amount less an estimated allowance for uncollectible accounts. The Company usually grants credit to customers with good credit standing for a maximum of 90 days and determines the adequacy of reserves for doubtful accounts based on individual account analysis and historical collection trends. The Company establishes a provision for doubtful receivables when there is objective evidence that the Company may not be able to collect amounts due. The allowance is based on management's best estimates of specific losses on individual exposures, as well as a provision on historical trends of collections. The provision is recorded against accounts receivables balances with a corresponding charge recorded in the consolidated statements of income and comprehensive income. Actual amounts received may differ from management's estimate of credit worthiness and the economic environment. Delinquent account balances are written off against the allowance for doubtful accounts after management has determined that the likelihood of collection is not probable. No allowance was considered necessary as of December 31, 2017 and March 31, 2017. |
Inventory, Policy [Policy Text Block] | Inventories Inventories are stated at the lower of cost or net realizable value. Inventories include cost of raw materials, freight, direct labor and related production overhead. The cost of inventories is determined using the First in, First-out (“FIFO”) method. The Company periodically reviews its inventories for excess or slow-moving items and makes provisions as necessary to properly reflect inventory value. |
Property, Plant and Equipment, Policy [Policy Text Block] | Property, Plant and Equipment Property, plant and equipment are recorded at cost, reduced by accumulated depreciation and amortization. Depreciation and amortization expense related to property, plant and equipment is computed using the straight-line method based on estimated useful lives of the assets, or in the case of leasehold improvements, the shorter of the initial lease term or the estimated useful life of the improvements. The useful life and depreciation method are reviewed periodically to ensure that the method and period of depreciation are consistent with the expected pattern of economic benefits from items of property, plant and equipment. Useful life Land Infinite Property and buildings 15 years Equipment and machinery 3-5 years Office and electronic equipment 3-5 years Automobiles 5 years Leasehold improvements Lesser of useful life and lease term Expenditures for maintenance and repairs, which do not materially extend the useful lives of the assets, are charged to expense as incurred. Expenditures for major renewals and betterments which substantially extend the useful life of assets are capitalized. The cost and related accumulated depreciation or amortization of assets retired or sold are removed from the respective accounts, and any gain or loss is recognized in the unaudited condensed consolidated statements of income and comprehensive income. |
Impairment or Disposal of Long-Lived Assets, Policy [Policy Text Block] | Impairment of Long-Lived Assets The Company assesses its long-lived assets, including property and equipment, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset group may not be recoverable. Factors which may indicate potential impairment include a significant underperformance relative to the historical or projected future operating results or a significant negative industry or economic trend. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by that asset. If impairment is indicated, a loss is recognized for any excess of the carrying value over the estimated fair value of the asset. The fair value is estimated based on the discounted future cash flows or comparable market values, if available. The Company did not record any impairment loss during the three and nine months ended December 31, 2017 and 2016. |
Revenue Recognition, Policy [Policy Text Block] | Revenue Recognition Revenue from product sales is recognized, net of estimated provisions for sales allowances and returns, when the merchandise is shipped and title is transferred. Revenue is recognized when all four of the following criteria are met: (i) persuasive evidence that an arrangement exists (sales agreements and customer purchase orders are used to determine the existence of an arrangement); (ii) delivery of goods has occurred and risks and benefits of ownership have been transferred, which is when the goods are received by the customer at its designated location in accordance with the sales terms; (iii) the sales price is both fixed and determinable; and (iv) collectability is reasonably assured. Most of the Company’s products are custom-made for large brand-name retailers. Historically, sales returns have been minimal. |
Shipping and Handling Cost, Policy [Policy Text Block] | Shipping and Handling Proceeds collected from customers for shipping and handling costs are included in revenues. Shipping and handling costs are expensed as incurred and are included in operating expenses, as a part of selling, general and administrative expenses. Total shipping and handling expenses were $ 111,205 117,387 508,204 420,820 |
Income Tax, Policy [Policy Text Block] | Income Taxes The Company is subject to income taxes on an entity basis on income arising in or derived from the tax jurisdiction in which each entity is domiciled. Jerash Holdings was incorporated in the State of Delaware and is subject to Federal income tax in the United States of America. GTI was incorporated in the BVI and is not subject to income taxes under the current laws of BVI. Treasure Success was registered in Hong Kong and has no operating profit for current tax liabilities. Jerash Garments, Jerash Embroidery, Chinese Garments and Victory Apparel are subject to the regulations of the Income Tax Department in Jordan. The corporate income tax rate is 14 December 31, 2018 342,254 341,349 0.04 0.04 The exempted income tax expense for Jerash Garments totaled $ 1,675,086 1,118,768 0.17 0.13 Local sales of Jerash Garments are subject to income tax at a fixed rate of 14 The Company accounts for income taxes in accordance with ASC 740, “Income Taxes,” which requires the Company to use the asset and liability method of accounting for income taxes. Under the asset and liability method, deferred income taxes are recognized for the tax consequences of temporary differences by applying enacted statutory tax rates applicable to future years to differences between financial statement carrying amounts and the tax bases of existing assets and liabilities and operating loss and tax credit carry forwards. Under this accounting standard, the effect on deferred income taxes of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is recognized if it is more likely than not that some portion, or all of, a deferred tax asset will not be realized. Deferred income taxes were immaterial, and accordingly, no deferred tax assets or liabilities were recognized as of December 31, 2017 and March 31, 2017. ASC 740 clarifies the accounting for uncertainty in tax positions. This interpretation requires that an entity recognize in its financial statements the impact of a tax position if that position is more likely than not to be sustained upon examination, based on the technical merits of the position. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company has elected to classify interest and penalties related to unrecognized tax benefits, if and when required, as part of income tax expense in the consolidated statements of income and comprehensive income. Jordan income tax returns prior to 2013 are not subject to examination by any applicable tax authorities. No significant uncertainty in tax positions relating to income taxes have been incurred during the periods ended December 31, 2017 and 2016. |
Foreign Currency Transactions and Translations Policy [Policy Text Block] | Foreign Currency Translation The reporting currency of the Company is the U.S. dollar and the Company uses the JOD as its functional currency, except for Treasure Success, which uses the Hong Kong Dollar (“HKD”) as its functional currency. The assets and liabilities of the Company have been translated into U.S. dollars using the exchange rates in effect at the balance sheet date, equity accounts have been translated into U.S. dollars at historical rates, and revenue and expenses have been translated into U.S. dollars using average exchange rates in effect during the reporting period. Cash flows are also translated into U.S. dollars at average translation rates for the periods; therefore, amounts related to assets and liabilities reported on the consolidated statements of cash flows will not necessarily agree with changes in the corresponding balances on the consolidated balance sheets. Translation adjustments arising from the use of different exchange rates from period to period are included as a separate component of accumulated other comprehensive income (loss). 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. The value of the JOD against the U.S. dollar and other currencies may fluctuate and is affected by, among other things, changes in Jordan’s political and economic conditions. Any significant revaluation of the JOD may materially affect the Company’s financial condition in terms of reporting in U.S. dollars. March 31, 2017 December 31, 2016 Period-end spot rate US$1=JOD 0.7097 US$1=JOD 0.7090 US$1=JOD 0.7106 US$1=HKD 0.1282 US$1=HKD 0.1287 US$1=HKD 0.1289 Average rate US$1=JOD 0.7093 US$1=JOD 0.7086 US$1=JOD 0.7109 US$1=HKD 0.1280 US$1=HKD 0.1289 |
Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block] | Stock-Based Compensation The Company measures compensation expense for stock-based awards to non-employee contractors and directors based upon the awards’ initial grant date fair value. The estimated grant date fair value of the award is recognized as expense over the requisite service period using the straight-line method. The fair value of awards to non-employees is then marked-to-market each reporting period until vesting criteria are satisfied. The Company estimates the fair value of stock warrants using the Black-Scholes model. This model is affected by the Company's stock price on the date of the grant as well as assumptions regarding a number of highly complex and subjective variables. These variables include the expected term of the warrant, the expected risk-free rates of return, the expected volatility of the Company's common stock, and the expected dividend yield, each of which is more fully described below. The assumptions for the expected term and the expected volatility are the two assumptions that significantly affect the grant date fair value. ⋅ Expected Term: the expected term of a warrant is the period of time that the warrant is expected to be outstanding. ⋅ Risk-free Interest Rate: the Company bases the risk-free interest rate used in the Black-Scholes model on the implied yield at the grant date of the U.S. Treasury zero coupon issue with an equivalent term to the stock-based award being valued. Where the expected term of a stock-based award does not correspond with the term for which a zero coupon interest rate is quoted, the Company uses the nearest interest rate from the available maturities. ⋅ Expected Stock Price Volatility: the Company utilizes comparable public company volatility over the same period of time as the life of the warrant. ⋅ Dividend Yield: because the Company does not expect to pay a dividend in the foreseeable future, a 0 |
Earnings Per Share, Policy [Policy Text Block] | Earnings per Share The Company computes earnings per share (“EPS”) in accordance with ASC 260, “Earnings per Share” (“ASC 260”). ASC 260 requires companies with complex capital structures to present basic and diluted EPS. Basic EPS is measured as net income divided by the weighted average common shares outstanding for the period. Diluted EPS is similar to basic EPS but presents the dilutive effect of potential common shares (e.g., convertible securities, options and warrants) on a per share basis as if the convertible securities had been converted at the beginning of the period presented, or the issuance date, if later. |
Comprehensive Income, Policy [Policy Text Block] | Comprehensive Income Comprehensive income consists of two components, net income and other comprehensive income (loss). The foreign currency translation gain or loss resulting from the translation of the financial statements expressed in JOD or HKD to U.S. dollars is reported in other comprehensive income (loss) in the consolidated statements of income and comprehensive income. |
Fair Value of Financial Instruments, Policy [Policy Text Block] | Fair Value of Financial Instruments ASC 825-10 requires certain disclosures regarding the fair value of financial instruments. 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. A three-level fair value hierarchy prioritizes the inputs used to measure fair value. The hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows: ⋅ Level 1 - Quoted prices in active markets for identical assets and liabilities. ⋅ Level 2 - Quoted prices in active markets for similar assets and liabilities, or other inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. ⋅ Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs. The Company considered the recorded value of its financial assets and liabilities, which consist primarily of cash, including restricted cash, accounts receivable, other receivables, due from related parties, due from shareholders, accounts payable, accrued expenses, other payables and short-term loans, to approximate the fair value of the respective assets and liabilities at December 31, 2017 and March 31, 2017 based upon the short-term nature of these assets and liabilities. |
Concentration Risk, Credit Risk, Policy [Policy Text Block] | Concentrations and Credit Risk Credit risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash. As of December 31, 2017 and March 31, 2017, $ 5,355,745 3,404,508 8,988,963 249,865 746 0 250,000 Accounts receivable are typically unsecured and derived from revenue earned from customers and therefore, are exposed to credit risk. The risk is mitigated by the Company's assessment of its customers' creditworthiness and its ongoing monitoring of outstanding balances. Customer and vendor concentration risk Prior to August 2016, substantially all of the Company’s sales were made to its customers through its affiliates (see Note 7) that are located primarily in the United States (see Note 9). Thereafter, the Company began selling directly to its customers. The Company’s operating results could be adversely affected by U.S. government policy on exporting business, foreign exchange rate fluctuations, and change of local market conditions. The Company has a concentration of its revenues and purchases with specific customers and suppliers. For the three months ended December 31, 2017, two customers accounted for 72 12 81 8 80 10 81 77 11 94 For the three months ended December 31, 2017, the Company purchased approximately 62 12 87 83 ONSET For the nine months ended December 31, 2016, the Company purchased 44 9 45 96 A loss of any of these customers or suppliers could adversely affect the operating results or cash flows of the Company. |
Risks and Uncertainties [Policy Text Block] | Risks and Uncertainties The principal operations of the Company are located in Jordan. Accordingly, the Company’s business, financial condition, and results of operations may be influenced by the political, economic, and legal environments in Jordan, as well as by the general state of the Jordanian economy. The Company’s operations in Jordan are subject to special considerations and significant risks that are not typically associated with companies in North America. These include risks associated with, among others, the political, economic and legal environment and foreign currency exchange. The Company’s results may be adversely affected by changes in the political, regulatory and social conditions in Jordan. Although the Company has not experienced losses from these situations and believes that it is in compliance with existing laws and regulations, including its organization and structure disclosed in Note 1, this may not be indicative of future results. |
New Accounting Pronouncements, Policy [Policy Text Block] | RECENT ACCOUNTING PRONOUNCEMENTS New Accounting Pronouncements Recently Adopted In July 2015, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2015-11, “Simplifying the Measurement of Inventory.” ASU No. 2015-11 changes the measurement principle for inventory from the lower of cost or market to the lower of cost and net realizable value. Net realizable value is defined as the estimated selling prices in the ordinary course of business; less reasonably predictable costs of completion, disposal and transportation. For public business entities, the amendments in this ASU are effective for fiscal years beginning after December 15, 2016, including interim reporting periods within those fiscal years. The Company adopted this guidance in the first quarter of its fiscal year ended March 31, 2018 using a prospective application. The adoption of this guidance did not have a material impact on the Company’s unaudited condensed consolidated financial statements and related disclosures. In March 2016, the FASB issued ASU 2016-09, “CompensationStock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting.” This update addresses several aspects of the accounting for share-based compensation transactions including: (a) income tax consequences when awards vest or are settled, (b) classification of awards as either equity or liabilities, (c) a policy election to account for forfeitures as they occur rather than on an estimated basis and (d) classification of excess tax impacts on the statement of cash flows. The Company adopted this guidance in the first quarter of its fiscal year ended March 31, 2018, which did not have a material impact to the unaudited condensed consolidated financial statements and related disclosures. The amendments requiring recognition of excess tax benefits and tax deficiencies in the income statement will be applied prospectively. The Company does not expect the impact to be material to the unaudited condensed consolidated results of operations; however, such determination is subject to change based on facts and circumstances at the time when awards vest or settle. New Accounting Pronouncements Not Yet Adopted In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”). ASU 2014-09 requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. ASU 2014-09 will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective and permits the use of either the retrospective or cumulative effect transition method. The guidance also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts. In August 2015, the FASB issued ASU No. 2015-14, “Deferral of the Effective Date” (“ASU 2015-14”), which defers the effective date for ASU 2014-09 by one year. The guidance in ASU 2014-09 will be effective for the Company for fiscal years beginning after December 15, 2017, including interim reporting periods within those fiscal years. In March 2016, the FASB issued ASU No. 2016-08, “Principal versus Agent Considerations (Reporting Revenue versus Net)” (“ASU 2016-08”), which clarifies the implementation guidance on principal versus agent considerations in the new revenue recognition standard. In April 2016, the FASB issued ASU No. 2016-10, “Identifying Performance Obligations and Licensing” (“ASU 2016-10”), which reduces the complexity when applying the guidance for identifying performance obligations and improves the operability and understandability of the license implementation guidance. In May 2016, the FASB issued ASU No. 2016-12 “Narrow-Scope Improvements and Practical Expedients” (“ASU 2016-12”), which amends the guidance on transition, collectability, noncash consideration and the presentation of sales and other similar taxes. Preliminarily, the Company plans to adopt Topic 606 using the retrospective transition method, and is continuing to evaluate the impact its pending adoption of Topic 606 will have on its consolidated financial statements. The Company believes that its current revenue recognition policies are generally consistent with the new revenue recognition standards set forth in ASU 2014-09. Potential adjustments to input measures are not expected to be pervasive to the majority of the Company’s contracts. While no significant impact is expected upon adoption of the new guidance, the Company will not be able to make that determination until the time of adoption based upon outstanding contracts at that time. In February 2016, the FASB issued ASU No. 2016-02, "Leases” to increase transparency and comparability among organizations by recognizing leased assets on the balance sheet with a corresponding liability and disclosing key information about leasing arrangements. For public business entities, the amendments in this ASU are effective for fiscal years beginning after December 15, 2018, including interim reporting periods within those fiscal years. For all other entities, the amendments in this ASU are effective for fiscal years beginning after December 15, 2019, and interim reporting periods within fiscal years beginning after December 15, 2020. Early adoption is permitted. The Company is evaluating the impact of the adoption of this revised guidance on its unaudited condensed consolidated financial statements and related disclosures. In May 2017, the FASB issued ASU 2017-09, “Scope of Modification Accounting,” which amends the scope of modification accounting for share-based payment arrangements, provides guidance on the types of changes to the terms or conditions of share-based payment awards to which an entity would be required to apply modification accounting under ASC 718. For all entities, the ASU is effective for annual reporting periods, including interim periods within those annual reporting periods, beginning after December 15, 2017. Early adoption is permitted, including adoption in any interim period. The Company does not expect that adoption of this guidance will have a material impact on its unaudited condensed consolidated financial statements and related disclosures. |
SUMMARY OF SIGNIFICANT ACCOUN19
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 9 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Schedule of Variable Interest Entities [Table Text Block] | The following table sets forth the carrying amounts of the assets and liabilities of the VIE, Victory Apparel, which was included in the Company’s consolidated balance sheets: December 31, 2017 March 31, 2017 Current assets $ 2,069 $ 2,096 Intercompany receivables* 311,393 321,317 Total assets 313,462 323,413 Third party current liabilities - (6,815) Total liabilities - (6,815) Net assets $ 313,462 $ 316,598 * Receivables from Jerash Garments are eliminated upon consolidation. |
Schedule of Depreciation and Amortization Expense Related to Property, Plant and Equipment [Table Text Block] | The estimated useful lives of depreciation and amortization of the principal classes of assets are as follows: Useful life Land Infinite Property and buildings 15 years Equipment and machinery 3-5 years Office and electronic equipment 3-5 years Automobiles 5 years Leasehold improvements Lesser of useful life and lease term |
Schedule of Differences between Reported Amount and Reporting Currency Denominated Amount [Table Text Block] | The following table outlines the currency exchange rates that were used in creating the consolidated financial statements in this report: March 31, 2017 December 31, 2016 Period-end spot rate US$1=JOD 0.7097 US$1=JOD 0.7090 US$1=JOD 0.7106 US$1=HKD 0.1282 US$1=HKD 0.1287 US$1=HKD 0.1289 Average rate US$1=JOD 0.7093 US$1=JOD 0.7086 US$1=JOD 0.7109 US$1=HKD 0.1280 US$1=HKD 0.1289 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 9 Months Ended |
Dec. 31, 2017 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory, Current [Table Text Block] | Inventories consisted of the following: As of As of December 31, 2017 March 31, 2017 Raw materials $ 3,205,286 $ 9,265,201 Work-in-progress 213,114 1,493,258 Finished goods 3,303,488 8,393,150 Total inventory $ 6,721,888 $ 19,151,609 |
PROPERTY, PLANT AND EQUIPMENT21
PROPERTY, PLANT AND EQUIPMENT, NET (Tables) | 9 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment [Table Text Block] | Property, plant and equipment, net consisted of the following: As of As of Land $ 61,022 $ 61,078 Property and buildings 432,163 432,562 Equipment and machinery 4,829,290 4,370,095 Office and electric equipment 503,953 472,918 Automobiles 358,116 302,714 Leasehold improvements 1,492,842 1,358,649 Subtotal 7,677,386 6,998,016 Construction in progress 230,363 206,246 Less: Accumulated Depreciation and Amortization (4,919,331) (4,044,020) Property and Equipment, Net $ 2,988,418 $ 3,160,242 |
EQUITY (Tables)
EQUITY (Tables) | 9 Months Ended |
Dec. 31, 2017 | |
Stockholders' Equity Note [Abstract] | |
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Table Text Block] | The fair value of these warrants granted was estimated as of the grant date using the Black-Scholes model with the following assumptions: Common Stock Warrants Expected term (in years) 5.0 Risk-free interest rate (%) 1.86 % Expected volatility (%) 52.2 % Dividend yield (%) 0.0 % |
Share-based Compensation, Activity [Table Text Block] | Warrant activity is summarized as follows: Shares Weighted Average Warrants outstanding at March 31, 2017 - - Granted 207,210 $ 5.69 Exercised - - Cancelled - - Warrants outstanding at December 31, 2017 207,210 $ 5.69 |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 9 Months Ended |
Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
Schedule of Relationship and Nature of Related Party Transactions [Table Text Block] | The relationship and the nature of related party transactions are summarized as follow: Name of Related Party Relationship to the Company Nature of Transactions Ford Glory Holdings Limited (“FGH”) Working Capital Advances Ford Glory International Limited, or FGIL Affiliate, subsidiary of FGH Sales / Purchases Value Plus (Macao Commercial Offshore) Limited (“VPMCO”) Affiliate, subsidiary of FGH Purchases Jiangmen V-Apparel Manufacturing Limited Affiliate, subsidiary of FGH Working Capital Advances Wealth Choice Limited, or WCL Shareholder of Victory Apparel Working Capital Advances |
Schedule of Related Party Transactions [Table Text Block] | a. Accounts receivable related party: Accounts receivable from a related party in connection with the collection of accounts receivable from its customers on behalf of the Company due to the support arrangement during the transition period as described below (see a. Sales to a related party) consisted of the following: As of As of FGIL $ 90,751 $ 2,343,892 b. Other receivables related party: As of As of WCL $ - $ 336,746 The balance due from WCL was interest-free and due upon demand. The balance as of March 31, 2017 was fully collected from WCL on June 15, 2017. c. Due from shareholders: As of As of Two individual shareholders $ - $ 353,175 Merlotte Enterprise Limited - 339,325 $ - $ 692,500 Prior to August 2016, the Company sold merchandise to its customers through its affiliate during the ordinary course of business. The sales made to the related party consist of the following: For the three months ended December 31, 2017 2016 FGIL $ - $ - For the nine months ended December 31, 2017 2016 FGIL $ - $ 23,350,919 Prior to August 2016, the Company periodically purchased merchandise or raw materials from its affiliates during the ordinary course of business. The purchases from related parties consist of the following: For the three months ended December 31, 2017 2016 VPMCO $ - $ - FGIL - - $ - $ - For the nine months ended December 31, 2017 2016 VPMCO $ - $ 5,144,675 FGIL - 916,527 $ - $ 6,061,202 |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 9 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas [Table Text Block] | The following table summarizes sales by geographic areas for the three months ended December 31, 2017 and 2016. For the three months ended December 31, 2017 December 31, 2016 United States $ 8,495,713 $ 11,452,005 Jordan 2,518,993 949,031 Other countries 529,057 214,726 Total $ 11,543,763 $ 12,615,762 The following table summarizes sales by geographic areas for the nine months ended December 31, 2017 and 2016. For the nine months ended December 31, 2017 December 31, 2016 United States $ 54,835,203 $ 46,617,843 Jordan 4,826,158 2,958,579 Other countries 782,039 292,216 Total $ 60,443,400 $ 49,868,638 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 9 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block] | Future minimum lease payments under non-cancelable operating leases are as follows: Twelve months ended December 31, 2018 $ 814,139 2019 11,079 2020 and thereafter - Total $ 825,218 |
ORGANIZATION AND DESCRIPTION 26
ORGANIZATION AND DESCRIPTION OF BUSINESS (Details Textual) | Dec. 31, 2017$ / sharesshares | May 11, 2017$ / sharesshares | Mar. 31, 2017$ / sharesshares | Oct. 31, 2016 | Jul. 05, 2016 | Jan. 01, 2015 | Jun. 13, 2013JOD | Mar. 11, 2013JOD | Sep. 18, 2005JOD | Nov. 26, 2000USD ($) | Nov. 26, 2000JOD |
Percentage of Individual Shareholder Transactions | 22.00% | ||||||||||
Noncontrolling Interest, Ownership Percentage by Parent | 100.00% | ||||||||||
Common Stock, Shares, Outstanding | shares | 9,895,000 | 8,787,500 | 8,787,500 | ||||||||
Common Stock, Par or Stated Value Per Share | $ / shares | $ 0.001 | $ 0.001 | |||||||||
Hashemite Kingdom of Jordan [Member] | |||||||||||
Capital | $ 70,500 | JOD 50,000 | |||||||||
Jerash Embroidery [Member] | |||||||||||
Capital | JOD 50,000 | ||||||||||
Chinese Garments [Member] | |||||||||||
Capital | JOD 50,000 | ||||||||||
Jerash Embroidery and Cinese Garments [Member] | |||||||||||
Noncontrolling Interest, Ownership Percentage by Parent | 100.00% | ||||||||||
Victory Apparel [Member] | |||||||||||
Capital | JOD 50,000 | ||||||||||
Jerash Garments [Member] | |||||||||||
Equity Method Investment, Ownership Percentage | 100.00% | ||||||||||
Jerash Holdings [Member] | |||||||||||
Common Stock, Shares, Outstanding | shares | 712,500 | ||||||||||
Common Stock, Par or Stated Value Per Share | $ / shares | $ 0.001 |
SUMMARY OF SIGNIFICANT ACCOUN27
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - Victory Apparel [Member] - USD ($) | Dec. 31, 2017 | Mar. 31, 2017 | |
Current assets | $ 2,069 | $ 2,096 | |
Intercompany receivables | [1] | 311,393 | 321,317 |
Total assets | 313,462 | 323,413 | |
Third party current liabilities | 0 | (6,815) | |
Total liabilities | 0 | (6,815) | |
Net assets | $ 313,462 | $ 316,598 | |
[1] | Receivables from Jerash Garments are eliminated upon consolidation. |
SUMMARY OF SIGNIFICANT ACCOUN28
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 1) | 9 Months Ended |
Dec. 31, 2017 | |
Land [Member] | |
Property, Plant and Equipment, Estimated Useful Lives | Infinite |
Building [Member] | |
Property, Plant and Equipment, Estimated Useful Lives | 15 |
Machinery and Equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment, Estimated Useful Lives | 5 |
Machinery and Equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment, Estimated Useful Lives | 3 |
Office Equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment, Estimated Useful Lives | 5 |
Office Equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment, Estimated Useful Lives | 3 |
Automobiles [Member] | |
Property, Plant and Equipment, Estimated Useful Lives | 5 |
Leasehold Improvements [Member] | |
Property, Plant and Equipment, Estimated Useful Lives | Lesser of useful life and lease term |
SUMMARY OF SIGNIFICANT ACCOUN29
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 2) | Dec. 31, 2017$ / JOD | Dec. 31, 2017$ / HKD | Mar. 31, 2017$ / JOD | Mar. 31, 2017$ / HKD | Dec. 31, 2016$ / JOD | Dec. 31, 2016$ / HKD |
Period-end spot rate [Member] | ||||||
Foreign Currency Exchange Rate, Translation | 0.7097 | 0.1282 | 0.7090 | 0.1287 | 0.7106 | 0.1289 |
Average rate [Member] | ||||||
Foreign Currency Exchange Rate, Translation | 0.7093 | 0.1280 | 0.7086 | 0.1289 | 0.7109 | 0.1289 |
SUMMARY OF SIGNIFICANT ACCOUN30
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Textual) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Mar. 31, 2017 | |
Noncontrolling Interest, Ownership Percentage by Parent | 100.00% | 100.00% | |||
Net loss attributable to noncontrolling interest | $ 26 | $ 8,929 | $ 2,845 | $ 32,016 | |
Shipping, Handling and Transportation Costs | $ 111,205 | 117,387 | $ 508,204 | 420,820 | |
Effective Income Tax Rate Reconciliation, Percent | 14.00% | 14.00% | |||
Income Tax Holiday, Description | In accordance with the Investment Encouragement Law, Jerash Garments' export sales to overseas customers are entitled to a 100% income tax exemption for a period of 10 years commencing on the first day of production. This exemption has been extended for 5 years until December 31, 2018. | ||||
Income Tax Holiday, Termination Date | December 31, 2018 | ||||
Income Tax Holiday, Aggregate Dollar Amount | $ 342,254 | $ 341,349 | $ 1,675,086 | $ 1,118,768 | |
Income Tax Holiday, Income Tax Benefits Per Share | $ 0.04 | $ 0.04 | $ 0.17 | $ 0.13 | |
Cash, FDIC Insured Amount | $ 250,000 | $ 250,000 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Dividend Rate | 0.00% | ||||
Customer Two [Member] | |||||
Concentration Risk, Percentage | 87.00% | ||||
Supplier One [Member] | |||||
Concentration Risk, Percentage | 62.00% | 44.00% | 83.00% | ||
Supplier Two [Member] | |||||
Concentration Risk, Percentage | 12.00% | 9.00% | |||
Supplier Three [Member] | |||||
Concentration Risk, Percentage | 45.00% | ||||
Sales Revenue, Net [Member] | Customer One [Member] | |||||
Concentration Risk, Percentage | 72.00% | 80.00% | 81.00% | 81.00% | |
Sales Revenue, Net [Member] | Customer Two [Member] | |||||
Concentration Risk, Percentage | 12.00% | 8.00% | |||
Accounts Receivable [Member] | Customer One [Member] | |||||
Concentration Risk, Percentage | 77.00% | 94.00% | |||
Accounts Receivable [Member] | Customer Two [Member] | |||||
Concentration Risk, Percentage | 10.00% | 11.00% | |||
Account Payable [Member] | Supplier One [Member] | |||||
Concentration Risk, Percentage | 96.00% | ||||
JORDAN | |||||
Deposits | $ 5,355,745 | $ 5,355,745 | $ 3,404,508 | ||
HONG KONG | |||||
Deposits | 8,988,963 | 8,988,963 | 249,865 | ||
UNITED STATES | |||||
Cash, FDIC Insured Amount | $ 746 | $ 746 | $ 0 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) | Dec. 31, 2017 | Mar. 31, 2017 |
Raw materials | $ 3,205,286 | $ 9,265,201 |
Work-in-progress | 213,114 | 1,493,258 |
Finished goods | 3,303,488 | 8,393,150 |
Total inventory | $ 6,721,888 | $ 19,151,609 |
PROPERTY, PLANT AND EQUIPMENT32
PROPERTY, PLANT AND EQUIPMENT, NET (Details) - USD ($) | Dec. 31, 2017 | Mar. 31, 2017 |
Subtotal | $ 7,677,386 | $ 6,998,016 |
Construction in progress | 230,363 | 206,246 |
Less: Accumulated Depreciation and Amortization | (4,919,331) | (4,044,020) |
Property and Equipment, Net | 2,988,418 | 3,160,242 |
Land [Member] | ||
Subtotal | 61,022 | 61,078 |
Property and Buildings [Member] | ||
Subtotal | 432,163 | 432,562 |
Machinery and Equipment [Member] | ||
Subtotal | 4,829,290 | 4,370,095 |
Office and Electric Equipment [Member] | ||
Subtotal | 503,953 | 472,918 |
Automobiles [Member] | ||
Subtotal | 358,116 | 302,714 |
Leasehold Improvements [Member] | ||
Subtotal | $ 1,492,842 | $ 1,358,649 |
PROPERTY, PLANT AND EQUIPMENT33
PROPERTY, PLANT AND EQUIPMENT, NET (Details Textual) | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2017USD ($)m² | Dec. 31, 2016USD ($) | Dec. 31, 2017USD ($)m² | Dec. 31, 2016USD ($) | |
Depreciation, Depletion and Amortization | $ | $ 310,953 | $ 338,798 | $ 899,277 | $ 1,034,414 |
Construction in Progress [Member] | ||||
Area of Land | m² | 450 | 450 |
EQUITY (Details)
EQUITY (Details) - Warrant [Member] | 9 Months Ended |
Dec. 31, 2017 | |
Expected term | 5 years |
Risk-free interest rate | 1.86% |
Expected volatility | 52.20% |
Dividend yield | 0.00% |
EQUITY (Details 1)
EQUITY (Details 1) - Warrant [Member] | 9 Months Ended |
Dec. 31, 2017$ / sharesshares | |
Warrants outstanding, Shares | shares | 0 |
Granted, Shares | shares | 207,210 |
Exercised, Shares | shares | 0 |
Cancelled, Shares | shares | 0 |
Warrants outstanding, Shares | shares | 207,210 |
Warrants outstanding, Weighted Average Exercise Price | $ / shares | $ 0 |
Granted, Weighted Average Exercise Price | $ / shares | 5.69 |
Exercised, Weighted Average Exercise Price | $ / shares | 0 |
Cancelled, Weighted Average Exercise Price | $ / shares | 0 |
Warrants outstanding, Weighted Average Exercise Price | $ / shares | $ 5.69 |
EQUITY (Details Textual)
EQUITY (Details Textual) - USD ($) | Aug. 01, 2017 | May 15, 2017 | Sep. 27, 2017 | Aug. 18, 2017 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2017 | Mar. 31, 2017 |
Preferred Stock, Par or Stated Value Per Share | $ 0.001 | $ 0.001 | ||||||
Preferred Stock, Shares Authorized | 500,000 | 500,000 | ||||||
Retained Earnings, Appropriation Description | Appropriations to the statutory reserve are required to be 10% of net income until the reserve is equal to 100% of the entity’s share capital. | |||||||
Retained Earnings, Appropriated | $ 71,699 | $ 71,699 | ||||||
Payments of Stock Issuance Costs | $ 379,828 | |||||||
Stock-based compensation expense for the warrant issued to the board observer | $ 116,578 | |||||||
Board Advisor [Member] | ||||||||
Stock-based compensation expense for the warrant issued to the board observer | $ 116,578 | $ 0 | ||||||
Warrant [Member] | ||||||||
Class of Warrant or Right, Price Per Warrant | 0.01 | 0.01 | ||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 6.25 | $ 6.25 | $ 6.25 | |||||
Class of Warrant or Right, Term | 5 years | 5 years | ||||||
Warrant [Member] | Board Advisor [Member] | ||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 50,000 | |||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 5 | |||||||
Class of Warrant or Right, Term | 5 years | |||||||
Private Placement [Member] | ||||||||
Number of Common Stock and Warrants To Be Sold | 540,000 | 50,000 | 200,000 | |||||
Stock Issued During Period, Shares, New Issues | 270,000 | 25,000 | 100,000 | |||||
Proceeds from Issuance of Common Stock, and Warrants | $ 1,352,700 | |||||||
Net Proceeds from Issuance of Common Stock, and Warrants | $ 110,179 | $ 450,910 | ||||||
Private Placement [Member] | Designee [Member] | ||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 6.25 | $ 6.25 | $ 6.25 | |||||
Class of Warrant or Right, Term | 5 years | 5 years | 5 years | |||||
Private Placement [Member] | Designee [Member] | Capital Units [Member] | ||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 18,000 | 48,600 | 4,500 | |||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 5.50 | $ 5.50 | $ 5.50 | |||||
Capital Units, Value | $ 43,122 | $ 107,990 | $ 10,814 | |||||
Private Placement [Member] | Shareholder [Member] | ||||||||
Stock Issued During Period, Shares, New Issues | 270,000 | 25,000 | 100,000 | |||||
Shares Issued, Price Per Share | $ 4.99 | $ 4.99 | $ 4.99 | |||||
Private Placement [Member] | Warrant [Member] | ||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 54,000 | 5,000 | 20,000 | |||||
Class of Warrant or Right, Price Per Warrant | 0.01 | |||||||
Class of Warrant or Right, Term | 5 years |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) | 9 Months Ended |
Dec. 31, 2017 | |
Ford Glory Holdings Limited [Member] | |
Nature of Common Ownership or Management Control Relationships | Intermediate Shareholder of GTI |
Related Party Transaction, Description of Transaction | Working Capital Advances |
Ford Glory International Limited [Member] | |
Nature of Common Ownership or Management Control Relationships | Affiliate, subsidiary of FGH |
Related Party Transaction, Description of Transaction | Sales / Purchases |
Value Plus Macao Commercial Offshore Limited [Member] | |
Nature of Common Ownership or Management Control Relationships | Affiliate, subsidiary of FGH |
Related Party Transaction, Description of Transaction | Purchases |
Jiangmen V-Apparel Manufacturing Limited [Member] | |
Nature of Common Ownership or Management Control Relationships | Affiliate, subsidiary of FGH |
Related Party Transaction, Description of Transaction | Working Capital Advances |
Wealth Choice Limited [Member] | |
Nature of Common Ownership or Management Control Relationships | Shareholder of Victory Apparel |
Related Party Transaction, Description of Transaction | Working Capital Advances |
RELATED PARTY TRANSACTIONS (D38
RELATED PARTY TRANSACTIONS (Details 1) - USD ($) | Dec. 31, 2017 | Mar. 31, 2017 |
FGIL | $ 90,751 | $ 2,343,892 |
Other receivable - related party | 0 | 336,746 |
Due from Officers or Stockholders, Current | 0 | 692,500 |
Two Individual Shareholders [Member] | ||
Due from Officers or Stockholders, Current | 0 | 353,175 |
Merlotte Enterprise Limited [Member] | ||
Due from Officers or Stockholders, Current | $ 0 | $ 339,325 |
RELATED PARTY TRANSACTIONS (D39
RELATED PARTY TRANSACTIONS (Details 2) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | |
Revenue, net from related party | $ 0 | $ 0 | $ 0 | $ 23,350,919 |
Ford Glory International Limited [Member] | ||||
Revenue, net from related party | $ 0 | $ 0 | $ 0 | $ 23,350,919 |
RELATED PARTY TRANSACTIONS (D40
RELATED PARTY TRANSACTIONS (Details 3) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | |
Related Party Transaction, Purchases from Related Party | $ 0 | $ 0 | $ 0 | $ 6,061,202 |
Value Plus Macao Commercial Offshore Limited [Member] | ||||
Related Party Transaction, Purchases from Related Party | 0 | 0 | 0 | 5,144,675 |
Ford Glory International Limited [Member] | ||||
Related Party Transaction, Purchases from Related Party | $ 0 | $ 0 | $ 0 | $ 916,527 |
RELATED PARTY TRANSACTIONS (D41
RELATED PARTY TRANSACTIONS (Details Textual) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Jul. 13, 2016 | |
Revenue from Related Parties | $ 0 | $ 0 | $ 0 | $ 23,350,919 | |
Victory City Investments Limited [Member] | |||||
Equity Method Investment, Ownership Percentage | 51.00% | ||||
Ford Glory International Limited [Member] | |||||
Revenue from Related Parties | $ 1,809,475 | $ 43,994,497 |
CREDIT FACILITIES (Details Text
CREDIT FACILITIES (Details Textual) - USD ($) | 1 Months Ended | |||
Aug. 21, 2017 | Dec. 31, 2017 | May 29, 2017 | Mar. 31, 2017 | |
Line of Credit, Current | $ 947,655 | $ 0 | ||
Senior Credit Facility [Member] | Treasure Success International [Member] | ||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 12,000,000 | $ 8,000,000 | ||
Debt Instrument, Collateral Amount | $ 3,000,000 | |||
Debt Instrument, Description of Variable Rate Basis | HSBC provided that drawings under the Senior Credit Facility would be charged interest at the Hong Kong Interbank Offered Rate (“HIBOR”) plus 1.5% for drawings in Hong Kong dollars, and the London Interbank Offered Rate (“LIBOR”) plus 1.5% for drawings in other currencies. | |||
Line of Credit, Current | $ 947,655 | |||
Senior Credit Facility [Member] | Treasure Success International [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||||
Debt Instrument, Basis Spread on Variable Rate | 1.50% | |||
Senior Credit Facility [Member] | Treasure Success International [Member] | Hong Kong, Dollars | ||||
Debt Instrument, Basis Spread on Variable Rate | 1.50% |
SEGMENT REPORTING (Details)
SEGMENT REPORTING (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | |
Sales Revenue, Goods, Net | $ 11,543,763 | $ 12,615,762 | $ 60,443,400 | $ 49,868,638 |
UNITED STATES | ||||
Sales Revenue, Goods, Net | 8,495,713 | 11,452,005 | 54,835,203 | 46,617,843 |
JORDAN | ||||
Sales Revenue, Goods, Net | 2,518,993 | 949,031 | 4,826,158 | 2,958,579 |
Other Countries [Member] | ||||
Sales Revenue, Goods, Net | $ 529,057 | $ 214,726 | $ 782,039 | $ 292,216 |
SEGMENT REPORTING (Details Text
SEGMENT REPORTING (Details Textual) | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | |
Sales Revenue, Goods, Net [Member] | Customer Concentration Risk [Member] | ||||
Concentration Risk, Percentage | 78.20% | 92.50% | 92.00% | 94.10% |
COMMITMENTS AND CONTINGENCIES45
COMMITMENTS AND CONTINGENCIES (Details) | Dec. 31, 2017USD ($) |
Twelve months ended December 31, | |
2,018 | $ 814,139 |
2,019 | 11,079 |
2020 and thereafter | 0 |
Total | $ 825,218 |
COMMITMENTS AND CONTINGENCIES46
COMMITMENTS AND CONTINGENCIES (Details Textual) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | |
Operating Leases, Rent Expense | $ 319,156 | $ 281,589 | $ 949,120 | $ 846,089 |
Minimum [Member] | ||||
Operating Leases, Rent Expense, Minimum Rentals | 247 | |||
Maximum [Member] | ||||
Operating Leases, Rent Expense, Minimum Rentals | $ 26,943 |