| SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE–
2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The
accompanying consolidated financial statements reflect the application of certain significant accounting policies as described in this
note and elsewhere in the accompanying consolidated financial statements and notes. ●
Basis of presentation These
accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the
United States of America (“U.S. GAAP”). ●
Use of estimates Preparing
these consolidated financial statements in conformity with U.S. GAAP requires the Company’s management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated
financial statements and the reported amounts of revenues and expenses during the periods reported. Making estimates requires management
to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set
of circumstances that existed at the date of the consolidated financial statements, which management considered in formulating its estimate,
could change in the near term due to one or more future confirming events. Such estimates may be subject to change as more current information
becomes available. Actual results may differ from these estimates. ●
Principles of consolidation The
consolidated financial statements include the financial statements of VIVC and its subsidiaries. All significant inter-company balances
and transactions within the Company have been eliminated upon consolidation. ●
Cash and cash equivalents Cash
and cash equivalents consist primarily of cash in readily available checking and saving accounts. Cash equivalents consist of highly
liquid investments that are readily convertible to cash and that mature within three months or less from the date of purchase. The carrying
amounts approximate fair value due to the short maturities of these instruments. ●
Credit losses On
January 1, 2023, the Company adopted Accounting Standards Update 2016-13 “Financial Instruments — Credit Losses (Topic
326), Measurement of Credit Losses on Financial Instruments,” which replaces the incurred loss methodology with an expected
loss methodology that is referred to as the current expected credit loss (“CECL”) methodology. The adoption of the
credit loss accounting standard has no material impact on the Company’s consolidated financial statements as of January 1,
2023. The
Company’s account receivables and other receivables in the balance sheet are within the scope of ASC Topic 326. As the Company
has limited customers and debtors, the Company uses the loss-rate method to evaluate the expected credit losses on an individual basis.
When establishing the loss rate, the Company makes the assessment based on various factors, including historical experience, credit-worthiness
of customers and debtors, current economic conditions, reasonable and supportable forecasts of future economic conditions, and other
factors that may affect its ability to collect from the customers and debtors. The Company also provides specific provisions for allowance
when facts and circumstances indicate that a receivable is unlikely to be collected. Expected
credit losses are recorded as allowance for credit losses on the consolidated statements of operations. After all attempts to collect
a receivable have failed, the receivable is written off against the allowance. In the event the Company recovers an amount that it previously
reserved for, the Company will reduce the specific allowance for credit losses. ●
Accounts receivable Accounts
receivable are recorded at the invoiced amount and do not bear interest and are due within contractual payment terms, generally 30 to
90 days from completion of service. Credit is extended based on an evaluation of a customer’s financial condition, the customer’s
credit-worthiness and payment history. Accounts receivable outstanding longer than the contractual payment terms are considered past
due. Past due balances over 90 days and over a specified amount are reviewed individually for collectability. Under the current expected
credit loss model, at the end of each period, the Company specifically evaluates each individual customer’s financial condition,
credit history, and the current economic conditions to monitor the progress of the collection of accounts receivables. The Company considers
the allowance for doubtful accounts for any estimated losses resulting from the inability of its customers to make required payments.
For receivables that are past due or not being paid according to payment terms, appropriate actions are taken to collect the amounts
due, including seeking legal resolution in a court of law. Account balances are charged off against the allowance after all reasonable
means of collection have been exhausted and the potential for recovery is considered remote. The Company does not have any off-balance-sheet
credit exposure related to its customers. As of June 30, 2024 and 2023, the Company had no ● Advances to Suppliers The
Company makes advances to certain vendors to purchase finished goods and service. The advances are interest-free and unsecured. As of
June 30, 2024 and 2023, the Company had advanced to suppliers $ 250,794 967,173 ● Inventories Inventories
are stated at the lower of cost or net realizable value with cost determined on a weighted-average basis. Management compares the cost
of inventories with the net realizable value and an allowance is made to write down inventories to market value, if lower. ●
Property and equipment Property,
plant, and equipment are stated at cost less accumulated depreciation and accumulated impairment losses, if any. Depreciation is calculated
on a straight-line basis over the following expected useful lives from the date on which assets become fully operational and after taking
into account their estimated residual values: SCHEDULE
OF PROPERTY AND EQUIPMENT EXPECTED USEFUL LIVES
Expected useful life
Service yacht 10
Motor vehicle 5
Office equipment 5 Expenditures
for repairs and maintenance are expensed as incurred. When assets have been retired or sold, the cost and related accumulated depreciation
are removed from the accounts and any resulting gain or loss is recognized in the results of operations. ●
Intangible assets, net Intangible
assets are stated at cost less accumulated amortization. Intangible assets represent the trademark registered in the PRC and purchased
software which are amortized on a straight-line basis over a useful life of 10 The
Company follows ASC Topic 350 in accounting for intangible assets, which requires impairment losses to be recorded when indicators of
impairment are present and the undiscounted cash flows estimated to be generated by the assets are less than the assets’ carrying
amounts. During the year s no ●
Deferred revenue Deferred
revenue represents advance payments made by a customer for goods and services the Company will provide in the future. Due to its short-term
nature, deferred revenue is usually satisfied within the 12 months. ●
Revenue recognition In
accordance with Accounting Standard Codification (“ASC”) Topic 606, “Revenue from Contracts with Customers”,
the Company recognizes revenues when goods or services are transferred to customers in an amount that reflects the consideration which
the Company expects to receive in exchange for those goods or services. In determining when and how revenues are recognized from contracts
with customers, the Company performs the following five-step analysis: (i) identification of contract with customer; (ii) determination
of performance obligations; (iii) measurement of the transaction price; (iv) allocation of the transaction price to the performance
obligations, and (v) recognition of revenues when (or as) the Company satisfies each performance obligation. The Company derives revenues
from processing, distribution, and sales of its products, mainly yachts. The Company recognize its revenue at a point in time when the
control of the products has been transferred to customers. ●
Comprehensive income (loss) ASC
Topic 220, “ Comprehensive Income ●
Income taxes Income
taxes are determined in accordance with the provisions of ASC Topic 740, “ Income Taxes ASC
740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements
uncertain tax positions taken or expected to be taken on a tax return. Under ASC 740, tax positions must initially be recognized in the
financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax
positions must initially and subsequently be measured as the largest amount of tax benefit that has a greater than 50% likelihood of
being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and relevant facts. The
Company is subject to tax in local and foreign jurisdiction. As a result of its business activities, the Company files tax returns that
are subject to examination by the relevant tax authorities. ●
Foreign currencies translation Transactions
denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing
at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated
into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded
in the consolidated statements of operations. The
reporting currency of the Company is the United States Dollar (“US$”) and the accompanying consolidated financial statements
have been expressed in US$. In addition, the Company and its subsidiaries operating or which operated in the PRC, Taiwan and Hong Kong
maintain their books and records in their local currency, Renminbi (“RMB”), New Taiwan Dollar (“TWD”) and Hong
Kong dollars (“HK$”), each of which is a functional currency, being the primary currency of the economic environment in which
their operations are conducted. In general, for consolidation purposes, assets, and liabilities of the Company’s subsidiaries whose
functional currency is not US$ are translated into US$, in accordance with ASC Topic 830-30, “Translation of Financial Statement Translation
of amounts from RMB, TWD and HK$ into US$ has been made at the following exchange rates as of June 30, 2024 and 2023. SCHEDULE
OF FOREIGN CURRENCY TRANSLATIONS
June 30, 2024 June 30, 2023
Period/year-end RMB:US$ exchange rate - 7.2513
Period/annual average RMB:US$ exchange rate - 6.9536
Period/year-end HK$:US$ exchange rate 7.8083 7.8363
Period/annual average HK$:US$ exchange rate 7.8190 7.8373
Period/year-end TWD:US$ exchange rate 32.4500 31.1400
Period/annual average TWD:US$ exchange rate 31.8278 30.7089 ●
Lease At
the inception of an arrangement, the Company determines whether the arrangement is or contains a lease based on the unique facts and
circumstances present. Leases with a term greater than one year are recognized on the balance sheet as right-of-use assets, lease liabilities
and long-term lease liabilities. The Company has elected not to recognize on the balance sheet leases with terms of one year or less.
Operating lease liabilities and their corresponding right-of-use assets are recorded based on the present value of lease payments over
the expected remaining lease term. However, certain adjustments to the right-of-use asset may be required for items such as prepaid or
accrued lease payments. The interest rate implicit in lease contracts is typically not readily determinable. As a result, the Company
utilizes its incremental borrowing rates, which are the rates incurred to borrow on a collateralized basis over a similar term an amount
equal to the lease payments in a similar economic environment. In
accordance with the guidance in ASC 842, components of a lease should be split into three categories: lease components (e.g., land, building,
etc.), non-lease components (e.g., common area maintenance, consumables, etc.), and non-components (e.g., property taxes, insurance,
etc.). Subsequently, the fixed and in-substance fixed contract consideration (including any related to non-components) must be allocated
based on the respective relative fair values to the lease components and non-lease components. The
Company made the policy election to not separate lease and non-lease components. Each lease component and the related non-lease components
are accounted for together as a single component. ●
Noncontrolling interest The
Company accounts for noncontrolling interests in accordance with ASC Topic 810-10-45, which requires the Company to present noncontrolling
interests as a separate component of total shareholders’ equity on the consolidated balance sheets and the consolidated net loss
attributable to its noncontrolling interest be clearly identified and presented on the face of the consolidated statements of operations
and comprehensive loss. The Company owned 70% of Wenzhou Jiaxu Yacht Company Limited (“Wenzhou Jiaxu”) prior to August 10,
2022. On August 10, 2022, the noncontrolling shareholder surrendered its 30% of Wenzhou Jiaxu to the Company, and Wenzhou Jiaxu became
a wholly-owned subsidiary of the Company. Wenzhou Jiaxu was disposed of on July 12, 2023 as a result of the Company’s disposal
of Weiguan Ship and its wholly-owned subsidiary Wenzhou Jiaxu (see Note 4). ●
Net income (loss) per share The
Company calculates net loss per share in accordance with ASC Topic 260, “Earnings per Share.” Basic income per share is computed
by dividing the net income by the weighted-average number of shares of common stock outstanding during the period. Diluted loss per share
of common stock is computed similar to basic loss per share of common stock except that the denominator is increased to include the number
of additional shares of common stock that would have been outstanding if the potential common stock equivalents had been issued and if
the additional common stock were dilutive (see Note 15). ●
Related parties Parties,
which can be an entity or individual, are considered to be related if the Company has the ability, directly or indirectly, to control
the other party or exercise significant influence over the other party in making financial and operational decisions. Companies are also
considered to be related if they are subject to common control or common significant influence. ●
Concentrations and credit risk SCHEDULE
OF CONCENTRATIONS AND CREDIT RISK (a)
Major customers
Percentage of Revenue
Years Ended June 30,
2024 2023
A 30.2 % -
B 29.7 % -
C 25.3 % - (b)
Major vendors
Percentage of Purchase
Years Ended June 30,
2024 2023
A 59.5 % -
B 11.7 % - The
Company’s principal financial instruments subject to potential concentration of credit risk are cash and cash equivalents, including
amounts held in money market accounts. The Company places cash deposits with a federally insured financial institution. The Company maintains
its cash at banks and financial institutions it considers to be of high credit quality; however, the Company’s domestic cash deposits
may at times exceed the insured limit. Balances in excess of insured limitations may not be insured. The Company has not experienced
losses on these accounts, and management believes that the Company is not exposed to significant risks on such accounts. ●
Fair value of financial instruments The
carrying value of the Company’s financial instruments (excluding short-term bank borrowing and notes payable): cash and cash equivalents,
accounts receivable, prepayments and other receivables, accounts payable, income tax payable, amount due to a related party, other payables
and accrued liabilities approximates their fair values because of the short-term nature of these financial instruments. Management
believes, based on the current market prices or interest rates for similar debt instruments, the fair value of notes payable approximates
the carrying amount. The
Company also follows the guidance of the ASC Topic 820-10, “ Fair Value Measurements and Disclosures ● Level 1 ● Level 2 : ● Level 3 Fair
value estimates are made at a specific point in time based on relevant market information about the financial instrument. These estimates
are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision.
Changes in assumptions could significantly affect the estimates. ●
Value-Added Tax (“VAT”) Sellers
and service providers are generally obligated to pay business tax for sales of goods or services within Taiwan unless the law provides
otherwise. For imported goods, the business tax will be paid by the goods receivers or buyers via customs. For imported services sold
by foreign companies to Taiwanese buyers, business tax shall be paid by the service buyers. However, the service buyer (corporate entity)
will not be required to pay business tax if it is exclusively engaged in taxable transactions subject to either 5% or 0% VAT. VAT
is applicable to general industries, and the VAT rate is 5 ●
Recent accounting pronouncements In
November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU
2023-07”). The amendments in ASU 2023-07 improve reportable segment disclosure requirements through enhanced disclosures about
significant segment expenses that are regularly provided to the chief operating decision maker (CODM). In addition, the amendments enhance
interim disclosure requirements, clarify circumstances in which an entity can disclose multiple segment measures of profit or loss, provide
new segment disclosure requirements for entities with a single reportable segment, and contain other disclosure requirements. ASU 2023-07
will be effective for annual reporting periods beginning after December 15, 2023, and interim periods within annual reporting periods
beginning after December 15, 2024. Early adoption is permitted. The adoption of ASU 2023-01 did not have a material impact on the Company’s
consolidated financial statement presentation or disclosures. In
December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”),
which requires disclosures of incremental income tax information within the rate reconciliation and expanded disclosures of income taxes
paid, among other disclosure requirements. This ASU will be effective for annual reporting periods beginning after December 15, 2024. The
Company’s management does not believe that any other recently issued, but not yet effective, authoritative guidance, if currently
adopted, will have a material impact on the Company’s consolidated financial statement presentation or disclosures. |
