| 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 In
preparing these consolidated financial statements, management makes estimates and assumptions that affect the reported amounts of assets
and liabilities in the balance sheet and revenues and expenses during the periods reported. Actual results may differ from these estimates.
● Basis
of consolidation 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.
● Accounts
receivable Accounts
receivable are recorded at the invoiced amount and do not bear interest, which are due within contractual payment terms, generally 30
to 90 days from completion of service. Credit is extended based on evaluation of a customers financial condition, the customer credit-worthiness
and their 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. At the end of fiscal year, the Company
specifically evaluates individual customers 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 the receivables that are past due or not being paid according
to payment terms, the appropriate actions are taken to exhaust all means of collection, including seeking legal resolution in a court
of law. Account balances are charged off against the allowance after all 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 December
31, 2022 and 2021, the Company recorded $855 and $0 allowance for doubtful accounts, respectively.
● Property,
plant, and equipment Property,
plant, and equipment are stated at cost less accumulated depreciation and accumulated impairment losses, if any. Depreciation is calculated
on the straight-line basis over the following expected useful lives from the date on which they become fully operational and after taking
into account their estimated residual values: Schedule
of Useful live of Assets
Expected
useful life
Service
yacht 10
years
Motor
vehicle 5
years
Office
equipment 5
years
Expenditure
for repairs and maintenance is expensed as incurred. When assets have retired or sold, the cost and related accumulated depreciation
are removed from the accounts and any resulting gain or loss is recognized in the results of operations.
● Intangible
assets, net Intangible
assets are stated at cost less accumulated amortization. Intangible assets represented the trademark registered in the PRC and purchased
software which are amortized on a straight-line basis over a useful life of 10 years. The
Company follows ASC Topic 350 in accounting for intangible assets, which requires impairment losses to be recorded when indicators of
impairment are present and the undiscounted cash flows estimated to be generated by the assets are less than the assets carrying
amounts.
● 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 the processing, distribution, and sale of its products.
● Comprehensive
income 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 statements of operations. The
reporting currency of the Company is United States Dollar (US$) and the accompanying consolidated financial statements have
been expressed in US$. In addition, the Company and subsidiaries are operating in PRC and Hong Kong maintain their books and record in
their local currency, Renminbi (RMB) and Hong Kong dollars (HK$), which is a functional currency as being
the primary currency of the economic environment in which their operations are conducted. In general, for consolidation purposes, assets,
and liabilities of its subsidiaries whose functional currency is not US$ are translated into US$, in accordance with ASC Topic 830-30,
Translation of Financial Statement Translation
of amounts from RMB and HK$ into US$ has been made at the following exchange rates as of and for the years ended December 31, 2022 and
December 31, 2021: Schedule of Foreign Currency Translations
December 31, 2022 December 31, 2021
Period/year-end RMB:US$ exchange rate 6.8972 6.3588
Period/annual average RMB:US$ exchange rate 6.7290 6.4499
Period/year-end HK$:US$ exchange rate 7.8015 7.7971
Period/annual average HK$:US$ exchange rate 7.8306 7.7723
Period/year-end TWD:US$ exchange rate 30.7300 27.6879
Period/annual average TWD:US$ exchange rate 29.7963 27.9194
● 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 interest 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 the its noncontrolling interest be clearly identified and presented on the face of the consolidated statements of operations
and comprehensive loss.
● Net
loss per share The
Company calculates net loss per share in accordance with ASC Topic 260, Earnings per Share
● Related
parties Parties,
which can be a corporation or individual, are considered to be related if the Company has the ability, directly or indirectly, to control
the other party or exercise significant influence over the other party in making financial and operational decisions. Companies are also
considered to be related if they are subject to common control or common significant influence.
● Concentrations
and credit risk The
Companys 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 Companys domestic cash deposits
may at times exceed the Federal Deposit
Insurance Corporations insured limit. Balances in excess of federally 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 Companys financial instruments (excluding short-term bank borrowing and note 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 approximate at 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 note payable approximate
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 Enterprises
or individuals, who sell commodities, engage in repair and consultation services in the PRC are subject
to a value added tax in accordance with PRC Laws. The VAT standard rate had been 17% of the gross sale price until April 30, 2018, after
which date the rate was reduced to 16%. VAT rate was further reduced to 13% starting from April 1, 2019. A credit is available whereby
VAT paid on the purchases of semi-finished products or raw materials used in the production of the Company’s finished products
can be used to offset the VAT due on the sales of the finished products.
● Recent
accounting pronouncements In
April 2019, the FASB issued ASU No. 2019-04, Codification Improvements to Topic 326, Financial Instruments - Credit Losses, Topic
815, Derivatives and Hedging, and Topic 825, Financial Instruments (ASU 2019-04) which clarifies treatment of certain
credit losses. In May 2019, the FASB issued ASU No. 2019-05, Financial Instruments - Credit Losses (Topic 326): Targeted Transition
Relief (ASU 2019-05) which provides an option to irrevocably elect to measure certain individual financial assets at
fair value instead of amortized cost. In November 2019, the FASB issued ASU No. 2019- 11, Codification Improvements to Topic 326,
Financial Instruments - Credit Losses (ASU 2019- 11), which provides guidance around how to report expected recoveries.
In February 2020, the Financial Accounting Standards Board issued ASU No. 2020-02, Financial Instruments - Credit Losses
(Topic 326) (ASU 2020-02) which provides updated guidance on how an entity should measure credit losses on financial instruments
and delayed the effective date of the original pronouncement for smaller reporting companies. ASU 2016- 13, ASU 2018- 19, ASU 2019-04,
ASU 2019-05, ASU 2019- 11 and ASU 2020-02 (collectively, ASC 326) are effective for public entities for fiscal years beginning
after December 15, 2019, with early adoption permitted. The adoption of ASC 326 did not have a material impact on the Companys
recognition of financial instruments within the scope of the standard. In
December 2019, the FASB issued ASU No 2019- 12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (ASU
2019- 12). ASU 2019- 12 removes certain exceptions to the general principles in Topic 740 in Generally Accepted Accounting Principles.
ASU 2019- 12 is effective for public entities for fiscal years beginning after December 15, 2020, with early adoption permitted. The
Company does not expect ASU 2019- 12 to have a material effect on the Companys current financial position, results of operations
or financial statement disclosures. In
March 2020, the FASB issued ASU 2020-03, Codification Improvements to Financial Instruments (ASU 2020-03). ASU
2020-03 improves and clarifies various financial instruments topics. ASU 2020-03 includes seven different issues that describe the areas
of improvement and the related amendments to GAAP, intended to make the standards easier to understand and apply by eliminating inconsistencies
and providing clarifications. The Company adopted ASU 2020-03 upon issuance, which did not have a material effect on the Companys
current financial position, results of operations or financial statement disclosures In
March 2020, the FASB issued ASU No 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform
on Financial Reporting (ASU 2020-04). ASU 2020-04 provides temporary optional expedients and exceptions to the US GAAP
guidance on contract modifications and hedge accounting to ease the financial reporting burdens related to the expected market transition
from the London Interbank Offered Rate (LIBOR) and other interbank offered rates to alternative reference rates. ASU 2020-04 is effective
beginning on March 12, 2020, and the Company may elect to apply the amendments prospectively through December 31, 2022. The Company does
not expect ASU 2020-04 to have a material effect on the Companys current financial position, results of operations or financial
statement disclosures. |
