Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2019 | Aug. 09, 2019 | |
Document And Entity Information | ||
Entity Registrant Name | Cosmos Group Holdings Inc. | |
Entity Central Index Key | 0001706509 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2019 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Is Entity's Reporting Status Current? | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 28,800,531 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2019 | |
Entity Small Business | true | |
Entity Emerging Growth | false | |
Entity Interactive Data Current | Yes | |
Entity Incorporation State County Code | NV | |
Entity File Number | 000-55793 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) | Jun. 30, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 8,716 | $ 12,149 |
Accounts receivable | 41,981 | 54,096 |
Total current assets | 50,697 | 66,245 |
Non-current assets: | ||
Property, plant and equipment, net | 73,811 | 83,728 |
TOTAL ASSETS | 124,508 | 149,973 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 64,320 | 44,036 |
Amounts due to related parties | 278,288 | 150,076 |
Current portion of obligation under finance lease | 18,333 | 20,000 |
Income tax payable | 16,342 | 16,342 |
Total current liabilities | 377,283 | 230,454 |
Non-current liabilities: | ||
Deferred tax liabilities | 12,999 | 12,999 |
Obligation under finance leases | 0 | 8,333 |
Total non-current liabilities | 12,999 | 21,332 |
TOTAL LIABILITIES | 390,282 | 251,786 |
Commitments and contingencies | ||
Stockholders' deficit: | ||
Preferred stock, $0.001 par value; 30,000,000 shares authorized; no preferred stock issued | 0 | 0 |
Common stock, $0.001 par value; 2,000,000,000 shares authorized; 21,492,933 shares issued and outstanding as of June 30, 2019 and December 31, 2018, respectively | 21,492 | 21,492 |
Accumulated losses | (287,266) | (123,305) |
Total stockholders' deficit | (265,774) | (101,813) |
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT | $ 124,508 | $ 149,973 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Jun. 30, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value | $ .001 | $ .001 |
Preferred stock, shares authorized | 30,000,000 | 30,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value | $ .001 | $ .001 |
Common stock, shares authorized | 2,000,000,000 | 2,000,000,000 |
Common stock, shares issued | 21,492,933 | 21,492,933 |
Common stock, shares outstanding | 21,492,933 | 21,492,933 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Income Statement [Abstract] | ||||
REVENUE | $ 137,546 | $ 225,147 | $ 265,548 | $ 358,873 |
Cost of revenues | (131,350) | (222,951) | (224,019) | (342,281) |
Gross profit | 6,196 | 2,196 | 41,529 | 16,592 |
OPERATING EXPENSES | ||||
General and administrative | 120,830 | 307,396 | 204,366 | 472,568 |
Total operating expenses | 120,830 | 307,396 | 204,366 | 472,568 |
LOSS FROM OPERATIONS | (114,634) | (305,200) | (162,837) | (455,976) |
Other (expense) income: | ||||
Interest income | 0 | 15 | 1 | 16 |
Interest expense | (562) | (562) | (1,125) | (1,125) |
Sundry income | 0 | 0 | 0 | 100 |
Total other expense | (562) | (547) | (1,124) | (1,009) |
LOSS BEFORE INCOME TAXES | (115,196) | (305,747) | (163,961) | (456,985) |
Income tax expense | 0 | 0 | 0 | 0 |
NET LOSS | (115,196) | (305,747) | (163,961) | (456,985) |
Other comprehensive income: | ||||
- Foreign currency translation gain | 0 | 0 | 0 | (7,280) |
COMPREHENSIVE LOSS | $ (115,196) | $ (305,747) | $ (163,961) | $ (464,265) |
Net loss per share: Basic and diluted | $ (0.01) | $ (0.01) | $ (0.01) | $ (0.02) |
Weighted average common shares outstanding: Basic and diluted | 21,492,933 | 21,492,933 | 21,492,933 | 21,492,933 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Cash flows from operating activities: | ||
Net loss | $ (163,961) | $ (456,985) |
Adjustments to reconcile net loss to net cash used in operating activities | ||
Depreciation of property, plant and equipment | 9,917 | 34,235 |
Change in operating assets and liabilities: | ||
Accounts receivable | 12,115 | (2,263) |
Purchase deposits | 0 | (8,654,498) |
Deposits and prepayments | 0 | (331,676) |
Accounts payable and accrued liabilities | 20,284 | 729,266 |
Customer deposits | 0 | 8,471,920 |
Net cash used in operating activities | (121,645) | (210,001) |
Cash flows from investing activities | ||
Purchase of property, plant and equipment | 0 | (149,324) |
Net cash used in investing activities | 0 | (149,324) |
Cash flows from financing activities: | ||
Amount due to a related company | 128,212 | 78,287 |
Amount due to a director | 0 | 225,721 |
Proceeds from bank borrowing | 0 | 1,495,000 |
Proceeds from issuance of common stock | 0 | 0 |
Repayment of finance lease | (10,000) | (10,000) |
Net cash provided by financing activities | 118,212 | 1,789,008 |
Effect on exchange rate change on cash and cash equivalents | 0 | 45,496 |
NET CHANGE IN CASH AND CASH EQUIVALENTS | (3,433) | 1,475,179 |
BEGINNING OF PERIOD | 12,149 | 99,583 |
END OF PERIOD | 8,716 | 1,574,762 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ||
Cash paid for interest | 1,125 | 1,125 |
Cash paid for tax | $ 0 | $ 0 |
Condensed Consolidated Statem_3
Condensed Consolidated Statement of Changes in Stockholders' Equity (Deficit) (Unaudited) - USD ($) | Common Stock | Accumulated Other Comprehensive Income (Loss) | Accumulated losses | Total |
Beginning balance, shares at Dec. 31, 2017 | 21,492,933 | |||
Beginning balance, value at Dec. 31, 2017 | $ 21,492 | $ (5,294) | $ (129,105) | $ (112,907) |
Foreign currency translation adjustment | 7,280 | 7,280 | ||
Net loss | (456,985) | (456,985) | ||
Ending balance, shares at Jun. 30, 2018 | 21,492,933 | |||
Ending balance, value at Jun. 30, 2018 | $ 21,492 | 1,986 | (586,090) | (562,612) |
Beginning balance, shares at Mar. 31, 2018 | 21,492,933 | |||
Beginning balance, value at Mar. 31, 2018 | $ 21,492 | (5,294) | (280,343) | (264,145) |
Foreign currency translation adjustment | 7,280 | 7,280 | ||
Net loss | (305,747) | (305,747) | ||
Ending balance, shares at Jun. 30, 2018 | 21,492,933 | |||
Ending balance, value at Jun. 30, 2018 | $ 21,492 | 1,986 | (586,090) | (562,612) |
Beginning balance, shares at Dec. 31, 2018 | 21,492,933 | |||
Beginning balance, value at Dec. 31, 2018 | $ 21,492 | 0 | (123,305) | (101,813) |
Net loss | (163,931) | (163,961) | ||
Ending balance, shares at Jun. 30, 2019 | 21,492,933 | |||
Ending balance, value at Jun. 30, 2019 | $ 21,492 | 0 | (287,266) | (265,774) |
Beginning balance, shares at Mar. 31, 2019 | 21,492,933 | |||
Beginning balance, value at Mar. 31, 2019 | $ 21,492 | 0 | (172,070) | (150,578) |
Net loss | (115,196) | (115,196) | ||
Ending balance, shares at Jun. 30, 2019 | 21,492,933 | |||
Ending balance, value at Jun. 30, 2019 | $ 21,492 | $ 0 | $ (287,266) | $ (265,774) |
1. Basis of Presentation
1. Basis of Presentation | 6 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | NOTE 1 - BASIS OF PRESENTATION The accompanying unaudited condensed consolidated financial statements have been prepared by management in accordance with both accounting principles generally accepted in the United States (“GAAP”), and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Certain information and note disclosures normally included in audited financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to those rules and regulations, although the Company believes that the disclosures made are adequate to make the information not misleading. In the opinion of management, the consolidated balance sheet as of December 31, 2018 which has been derived from audited financial statements and these unaudited condensed consolidated financial statements reflect all normal and recurring adjustments considered necessary to state fairly the results for the periods presented. The results for the period ended June 30, 2019 are not necessarily indicative of the results to be expected for the entire fiscal year ending December 31, 2019 or for any future period. These unaudited condensed consolidated financial statements and notes thereto should be read in conjunction with the Management’s Discussion and the audited financial statements and notes thereto included in the Annual Report on Form 10-K for the year ended December 31, 2018. |
2. Organization and Business Ba
2. Organization and Business Background | 6 Months Ended |
Jun. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Business Background | NOTE 2 - ORGANIZATION AND BUSINESS BACKGROUND Cosmos Group Holdings Inc. (the “Company” or “COSG”) incorporated in the state of Nevada on August 14, 1987. The Company, through its subsidiaries, mainly engages in the provision of truckload transportation service in Hong Kong, in which the Company utilizes its owned trucks or independent contractor owned trucks for the pickup and delivery of freight from port to the designated destination, upon the customers’ request. Description of subsidiaries Name Place of incorporation and kind of legal entity Principal activities and place of operation Particulars of issued/ registered share capital Effective interest held Lee Tat International Holdings Limited British Virgin Islands Investment holding 50,000 shares at US$1 each 100% Lee Tat Transportation International Limited Hong Kong Logistic and delivery 10,000 ordinary shares for HK$10,000 100% Cosmos Robotor Holdings Limited British Virgin Islands Investment holding 50,000 shares at US$0.001 each 100% AiTeach International Limited# Hong Kong AI Business 10,000 ordinary shares for HK$100 100% Hong Kong Healthtech Limited# Hong Kong AI Business 5,100 ordinary shares for HK$5,100 51% COSG and its subsidiaries are hereinafter referred to as (the “Company”). |
3. Summary of Significant Accou
3. Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | NOTE The accompanying condensed consolidated financial statements reflect the application of certain significant accounting policies as described in this note and elsewhere in the accompanying condensed consolidated financial statements and notes. · Use of estimates In preparing these condensed 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 condensed consolidated financial statements include the financial statements of COSG 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 customer's 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 customer’s financial condition, credit history, and the current economic conditions to monitor the progress of the collection of accounts receivables. The Company will consider 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 June 30, 2019, there was no allowance for doubtful accounts. · 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: Expected useful life Service vehicle 8 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. Depreciation expense for the three months ended June 30, 2019 and 2018 were $4,959 and $14,100, as part of cost of revenue, respectively. Depreciation expense for the six months ended June 30, 2019 and 2018 were $9,917 and $34,235, as part of cost of revenue, respectively. · Impairment of long-lived assets In accordance with the provisions of ASC Topic 360, “Impairment or Disposal of Long-Lived Assets”, all long-lived assets such as property, plant and equipment held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is evaluated by a comparison of the carrying amount of an asset to its estimated future undiscounted cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amounts of the assets exceed the fair value of the assets. There has been no impairment charge for the three and six months ended June 30, 2019. · Revenue recognition The Company adopted Accounting Standards Update ("ASU") No. 2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”) using the full retrospective transition method. The Company's adoption of ASU 2014-09 did not have a material impact on the amount and timing of revenue recognized in its condensed consolidated financial statements. Under ASU 2014-09, the Company recognizes revenue when control of the promised goods or services is transferred to customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. The Company derives its revenues from the rendering of transportation services and recognizes in full upon completion of delivery to the receiver’s location. The Company applies the following five steps in order to determine the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its agreements: • identify the contract with a customer; • identify the performance obligations in the contract; • determine the transaction price; • allocate the transaction price to performance obligations in the contract; and • recognize revenue as the performance obligation is satisfied. · Comprehensive income ASC Topic 220, “Comprehensive Income”, establishes standards for reporting and display of comprehensive income, its components and accumulated balances. Comprehensive income as defined includes all changes in equity during a period from non-owner sources. Accumulated other comprehensive income, as presented in the accompanying condensed consolidated statement of stockholders’ equity, consists of changes in unrealized gains and losses on foreign currency translation. This comprehensive income is not included in the computation of income tax expense or benefit. · Income taxes Income taxes are determined in accordance with the provisions of ASC Topic 740, “Income Taxes” (“ASC 740”). Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Any effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. ASC 740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements uncertain tax positions taken or expected to be taken on a tax return. Under ASC 740, tax positions must initially be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions must initially and subsequently be measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and relevant facts. For the three and six months ended June 30, 2019 and 2018, the Company did not have any interest and penalties associated with tax positions. As of June 30, 2019, the Company did not have any significant unrecognized uncertain tax positions. The Company conducts the majority of its businesses in the PRC and is subject to tax in this jurisdiction. As a result of its business activities, the Company files tax returns that are subject to examination by a foreign tax authority. · Finance leases Leases that transfer substantially all the rewards and risks of ownership to the lessee, other than legal title, are accounted for as finance leases. Substantially all of the risks or benefits of ownership are deemed to have been transferred if any one of the four criteria is met: (i) transfer of ownership to the lessee at the end of the lease term, (ii) the lease containing a bargain purchase option, (iii) the lease term exceeding 75% of the estimated economic life of the leased asset, (iv) the present value of the minimum lease payments exceeding 90% of the fair value. At the inception of a finance lease, the Company as the lessee records an asset and an obligation at an amount equal to the present value of the minimum lease payments. The leased asset is amortized over the shorter of the lease term or its estimated useful life if title does not transfer to the Company, while the leased asset is depreciated in accordance with the Company’s depreciation policy if the title is to eventually transfer to the Company. The periodic rent payments made during the lease term are allocated between a reduction in the obligation and interest element using the effective interest method in accordance with the provisions of ASC Topic 835-30, “Imputation of Interest”. · Net loss per share The Company calculates net loss per share in accordance with ASC Topic 260, “ Earnings per Share · Foreign currencies translation Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the statement of operations. The reporting currency of the Company is the United States Dollar ("US$"). The Company's subsidiaries in Hong Kong and the PRC maintain their books and records in their local currency, Hong Kong Dollars ("HK$") and Renminbi Yuan (“RMB”), which is the functional currency as being the primary currency of the economic environment in which these entities operate. Convenience translation of amounts from the local currency of the Company into US$ has been made at the pegged exchange rate at 0.129 for the respective years. In general, for consolidation purposes, assets and liabilities of its subsidiaries whose functional currency is not the US$ are translated into US$, in accordance with ASC Topic 830-30, “ Translation of Financial Statement · 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. · Segment reporting ASC Topic 280, “Segment Reporting” establishes standards for reporting information about operating segments on a basis consistent with the Company’s internal organization structure as well as information about geographical areas, business segments and major customers in financial statements. For the three and six months ended June 30, 2019 and 2018, the Company operates in one reportable operating segment in the Hong Kong. · Fair value of financial instruments The carrying value of the Company’s financial instruments (excluding short-term bank borrowing and note payable): cash and cash equivalents, accounts and retention 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 short-term bank borrowings and 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. · Recent accounting pronouncements In February 2016, the Financial Accounting Standard Board (“FASB”) issued Accounting Standards Update (ASU) No. 2016-02, Leases (Topic 842) (ASU 2016-02), which requires a lessee to recognize most leases on the balance sheet as lease liabilities with corresponding right-of-use assets. The Company adopted ASU 2016-02 utilizing the modified retrospective transition method at the beginning of the first quarter of 2019. As a result of the adoption of ASC 842, the Company recorded finance lease liabilities of $28,333 at the beginning of the first quarter of 2019, with no material impact to the statement of operations. In August 2017, the FASB issued ASU No. 2017-12, Derivatives and Hedging (ASU 2017-12), which is intended to more closely align hedge accounting with companies’ risk management strategies, simplify the application of hedge accounting, and increase transparency regarding the scope and results of hedging programs. The guidance in this update is applied using a cumulative-effect adjustment to retained earnings at the beginning of the fiscal year of adoption. ASU 2017-12 is effective for public business entities for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The adoption of ASU 2017-12 at the beginning of the first quarter of 2019 did not have a significant impact on the Company’s financial statements. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (ASU 2016-13), which changes the accounting for recognizing impairments of financial assets. Under the new guidance, credit losses for certain types of financial instruments will be estimated based on expected losses. The new guidance also modifies the impairment models for available-for-sale debt securities and for purchased financial assets with credit deterioration since their origination. ASU 2016-13 is effective for public business entities for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years, and early adoption is permitted. The Company is currently evaluating the impact that this guidance will have on its financial statements. In January 2017, the FASB issued ASU No. 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (ASU 2017-14). This new guidance eliminates the requirement to calculate the implied fair value of goodwill to measure a goodwill impairment charge. Instead, entities will record an impairment charge based on the excess of a reporting unit’s carrying amount over its fair value. ASU 2017-14 is effective for public business entities for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years, and early adoption is permitted. The Company is currently evaluating the impact that this guidance will have on its financial statements. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement: Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement (ASU 2018-13), which adds and modifies certain disclosure requirements for fair value measurements. Under the new guidance, entities will no longer be required to disclose the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, or valuation processes for Level 3 fair value measurements. However, public business entities will be required to disclose the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and related changes in unrealized gains and losses included in other comprehensive income. ASU 2018-13 is effective for public business entities for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years, and early adoption is permitted. The Company is currently evaluating the impact that this guidance will have on its financial statements. In August 2018, the FASB issued ASU No. 2018-15, Intangibles - Goodwill and Other – Internal-Use Software: Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract (ASU 2018-05). This new guidance requires a customer in a cloud computing arrangement to determine which implementation costs to capitalize as assets or expense as incurred. Capitalized implementation costs related to a hosting arrangement that is a service contract will be amortized over the term of the hosting arrangement, beginning when the module or component of the hosting arrangement is ready for its intended use. ASU 2018-05 is effective for public business entities for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years, and early adoption is permitted. Application of this guidance can be applied either prospectively or retrospectively. The Company is currently evaluating the impact that this guidance will have on its financial statements. |
4. Going Concern Uncertainties
4. Going Concern Uncertainties | 6 Months Ended |
Jun. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Going Concern Uncertainties | NOTE 4 - GOING CONCERN UNCERTAINTIES The accompanying condensed consolidated financial statements have been prepared using the going concern basis of accounting, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has experienced a net loss of $163,961 and negative operating cash flows of $121,645 for the period ended June 30, 2019. Also, at June 30, 2019, the Company has incurred an accumulated deficit of $287,266. The continuation of the Company as a going concern through June 30, 2020 is dependent upon the continued financial support from its stockholders. Management believes the Company is currently pursuing additional financing for its operations. However, there is no assurance that the Company will be successful in securing sufficient funds to sustain the operations. These and other factors raise substantial doubt about the Company’s ability to continue as a going concern. These condensed consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets and liabilities that may result in the Company not being able to continue as a going concern. |
5. Amounts due to Related Parti
5. Amounts due to Related Parties | 6 Months Ended |
Jun. 30, 2019 | |
Related Party Transactions [Abstract] | |
Amounts due to Related Parties | NOTE 5 - AMOUNT DUE TO RELATED PARTIES The amounts represented temporary advances to the Company by related parties, which were unsecured, interest-free and had no fixed terms of repayments. Imputed interest from related party loan is not significant. |
6. Obligation under Finance Lea
6. Obligation under Finance Lease | 6 Months Ended |
Jun. 30, 2019 | |
Leases [Abstract] | |
Obligation under Finance Lease | NOTE 6 - OBLIGATION UNDER FINANCE LEASES The Company purchased a service vehicle under a finance lease agreement with the effective interest rate of 2.25% per annum, due through May 29, 2020, with principal and interest payable monthly. The obligation under the finance lease is as follows: June 30, 2019 December 31, 2018 (Unaudited) (Audited) Finance lease $ 20,396 $ 31,522 Less: interest expense (2,063 ) (3,189 ) $ 18,333 $ 28,333 Current portion 18,333 20,000 Non-current portion – 8,333 Total $ 18,333 $ 28,333 |
7. Income Taxes
7. Income Taxes | 6 Months Ended |
Jun. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | NOTE 7 - INCOME TAXES The Company generated an operating loss for the three and six months ended June 30, 2019 and 2018 and did not record income tax expense. The Company has operations in various countries and is subject to tax in the jurisdictions in which they operate, as follows: United States of America COSG is registered in the State of Nevada and is subject to the tax laws of United States of America As of June 30, 2019, the operation in the United States of America incurred $2,155,600 of cumulative net operating losses which can be carried forward to offset future taxable income. The net operating loss carryforwards begin to expire in 2039, if unutilized. The Company has provided for a full valuation allowance against the deferred tax assets of $452,676 on the expected future tax benefits from the net operating loss carryforwards as the management believes it is more likely than not that these assets will not be realized in the future. Hong Kong The Company’s subsidiaries operating in Hong Kong are subject to the Hong Kong Profits Tax at the two-tiered income tax rate from 8.25% to 16.5% on the assessable income arising in Hong Kong during its tax year. The reconciliation of income tax rate to the effective income tax rate for the six months ended June 30, 2019 and 2018 is as follows: Six months ended June 30, 2019 2018 Loss before income taxes $ (44,263 ) $ (456,985 ) Statutory income tax rate 8.25% 16.5% Income tax expense at statutory rate (3,651 ) (75,402 ) Tax effect from non-deductible items 818 25,610 Tax effect from non-taxable item – (604 ) Tax effect from deductible items (318 ) (3,545 ) Tax loss carryforwards 3,151 53,941 Income tax expense $ – $ – |
8. Stockholders' Equity
8. Stockholders' Equity | 6 Months Ended |
Jun. 30, 2019 | |
Equity [Abstract] | |
Stockholders' Equity | NOTE 8 - STOCKHOLDERS’ EQUITY As of June 30, 2019, the Company had a total of 21,492,933 shares of its common stock issued and outstanding. |
9. Related Party Transactions
9. Related Party Transactions | 6 Months Ended |
Jun. 30, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 9 - RELATED PARTY TRANSACTIONS From time to time, the stockholder and director of the Company advanced funds to the Company for working capital purpose. Those advances are unsecured, non-interest bearing and due on demand. The imputed interest on the loan from a related party was not significant. Apart from the transactions and balances detailed elsewhere in these accompanying condensed consolidated financial statements, the Company has no other significant or material related party transactions during the periods presented. |
10. Concentrations of Risk
10. Concentrations of Risk | 6 Months Ended |
Jun. 30, 2019 | |
Risks and Uncertainties [Abstract] | |
Concentrations of Risk | NOTE 10 - CONCENTRATIONS OF RISK The Company is exposed to the following concentrations of risk: (a) Major customer For the three months ended June 30, 2019 and 2018, the customers who accounts for 10% or more of the Company’s revenues and its outstanding receivable balances as at year-end dates, are presented as follows: Three months ended June 30, 2019 June 30, 2019 Customers Revenues Percentage Accounts Customer B $ 59,417 43% $ 16,530 Customer A 51,869 38% 18,898 Total: $ 111,286 81% Total: $ 35,428 Three months ended June 30, 2018 June 30, 2018 Customers Revenues Percentage Accounts Customer A $ 120,027 53% $ – Customer B 83,789 37% – Total: $ 203,816 90% Total: $ – For the six months ended June 30, 2019 and 2018, the customers who accounts for 10% or more of the Company’s revenues and its outstanding receivable balances as at year-end dates, are presented as follows: Six months ended June 30, 2019 June 30, 2019 Customers Revenues Percentage Accounts Customer B $ 111,940 42% $ 16,530 Customer A 110,168 41% 18,898 Total: $ 222,108 83% Total: $ 35,428 Six months ended June 30, 2018 June 30, 2018 Customers Revenues Percentage Accounts Customer A $ 197,654 55% $ – Customer B 126,821 35% – Total: $ 324,475 90% Total: $ – All customers are located in the Hong Kong. (b) Major vendors For the three and six months ended June 30, 2019, one vendor represented more than 10% of the Company’s purchase. This vendor (Vendor C) accounted for 13% of the Company’s purchase amounting to $23,247 and $29,692, respectively with $1,808 of accounts payable at June, 2019. For the three and six months ended June 30, 2018, one vender represented more than 10% of the Company’s operating cost. This vendor accounted for 14% of the Company’s operating cost amounting to $14,542 and $47,258, respectively with $0 of accounts payable at June 30, 2018. All vendors are located in the Hong Kong. (c) Credit risk Financial instruments that are potentially subject to credit risk consist principally of trade receivables. The Company believes the concentration of credit risk in its trade receivables is substantially mitigated by its ongoing credit evaluation process and relatively short collection terms. The Company does not generally require collateral from customers. The Company evaluates the need for an allowance for doubtful accounts based upon factors surrounding the credit risk of specific customers, historical trends and other information. (d) Interest rate risk As the Company has no significant interest-bearing assets, the Company’s income and operating cash flows are substantially independent of changes in market interest rates. The Company’s interest-rate risk arises from borrowing under notes and bank borrowings. The Company manages interest rate risk by varying the issuance and maturity dates variable rate debt, limiting the amount of variable rate debt, and continually monitoring the effects of market changes in interest rates. As of June 30, 2019, borrowings under related party notes were at fixed rates and short-term bank borrowings were at variable rates. (e) Exchange rate risk The reporting currency of the Company is US$, to date the majority of the revenues and costs are denominated in HKD and a significant portion of the assets and liabilities are denominated in HKD. As a result, the Company is exposed to foreign exchange risk as its revenues and results of operations may be affected by fluctuations in the exchange rate between US$ and HKD. If HKD depreciates against US$, the value of HKD revenues and assets as expressed in US$ financial statements will decline. The Company does not hold any derivative or other financial instruments that expose to substantial market risk. |
11. Subsequent Events
11. Subsequent Events | 6 Months Ended |
Jun. 30, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 11 - SUBSEQUENT EVENTS The Company evaluated subsequent events through the date the financial statements were issued and filed with this Form 10-Q. There were certain subsequent events that required recognition or disclosure, as follows: On July 19, 2019, the Company consummated the acquisition of 5,100 Ordinary Shares of Hong Kong Healthtech Limited, a limited company organized under the laws of Hong Kong (“HKHL”), representing approximately 51% of the issued and outstanding stock of HKHL under a Share Exchange Agreement (the “Share Exchange Agreement”), and acquired the right to exploit certain intellectual property relating to Artificial Intelligence Education. As a result, the Company entered into the business of developing and delivering educational content in the AI Education industry. In connection with the Share Exchange, the Company entered into an Intellectual Property Ownership and License Agreement with HKHL, 深圳傅正勤教育科技有限公司 The Company established its two subsidiaries Cosmos Robotor Holdings Limited, a British Virgin Islands corporation, on May 7, 2019, and AiTeach International Limited, a Hong Kong limited liability company, on June 3, 2019. In connection with the acquisition of HKHL, the Company incurred the obligation to issue 6,232,951 shares of its common stock to Mr Wing Lok Jonathan SO, Chief Strategy Officer and 1,074,647 shares of its common stock to Hung-Yi HUNG, a consultant, respectively. The Company is in the process of issuing such securities to Messrs. So and Hung and expects to finalize this process in the near futur |
3. Summary of Significant Acc_2
3. Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Use of estimates | · Use of estimates In preparing these condensed 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 | · Basis of consolidation The condensed consolidated financial statements include the financial statements of COSG 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 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 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 customer's 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 customer’s financial condition, credit history, and the current economic conditions to monitor the progress of the collection of accounts receivables. The Company will consider 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 June 30, 2019, there was no allowance for doubtful accounts. |
Property, plant and equipment | · 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: Expected useful life Service vehicle 8 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. Depreciation expense for the three months ended June 30, 2019 and 2018 were $4,959 and $14,100, as part of cost of revenue, respectively. Depreciation expense for the six months ended June 30, 2019 and 2018 were $9,917 and $34,235, as part of cost of revenue, respectively. |
Impairment of long-lived assets | · Impairment of long-lived assets In accordance with the provisions of ASC Topic 360, “Impairment or Disposal of Long-Lived Assets”, all long-lived assets such as property, plant and equipment held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is evaluated by a comparison of the carrying amount of an asset to its estimated future undiscounted cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amounts of the assets exceed the fair value of the assets. There has been no impairment charge for the three and six months ended June 30, 2019. |
Revenue recognition | · Revenue recognition The Company adopted Accounting Standards Update ("ASU") No. 2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”) using the full retrospective transition method. The Company's adoption of ASU 2014-09 did not have a material impact on the amount and timing of revenue recognized in its condensed consolidated financial statements. Under ASU 2014-09, the Company recognizes revenue when control of the promised goods or services is transferred to customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. The Company derives its revenues from the rendering of transportation services and recognizes in full upon completion of delivery to the receiver’s location. The Company applies the following five steps in order to determine the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its agreements: • identify the contract with a customer; • identify the performance obligations in the contract; • determine the transaction price; • allocate the transaction price to performance obligations in the contract; and • recognize revenue as the performance obligation is satisfied. |
Comprehensive income | · Comprehensive income ASC Topic 220, “Comprehensive Income”, establishes standards for reporting and display of comprehensive income, its components and accumulated balances. Comprehensive income as defined includes all changes in equity during a period from non-owner sources. Accumulated other comprehensive income, as presented in the accompanying condensed consolidated statement of stockholders’ equity, consists of changes in unrealized gains and losses on foreign currency translation. This comprehensive income is not included in the computation of income tax expense or benefit. |
Income taxes | · Income taxes Income taxes are determined in accordance with the provisions of ASC Topic 740, “Income Taxes” (“ASC 740”). Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Any effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. ASC 740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements uncertain tax positions taken or expected to be taken on a tax return. Under ASC 740, tax positions must initially be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions must initially and subsequently be measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and relevant facts. For the three and six months ended June 30, 2019 and 2018, the Company did not have any interest and penalties associated with tax positions. As of June 30, 2019, the Company did not have any significant unrecognized uncertain tax positions. The Company conducts the majority of its businesses in the PRC and is subject to tax in this jurisdiction. As a result of its business activities, the Company files tax returns that are subject to examination by a foreign tax authority. |
Finance leases | · Finance leases Leases that transfer substantially all the rewards and risks of ownership to the lessee, other than legal title, are accounted for as finance leases. Substantially all of the risks or benefits of ownership are deemed to have been transferred if any one of the four criteria is met: (i) transfer of ownership to the lessee at the end of the lease term, (ii) the lease containing a bargain purchase option, (iii) the lease term exceeding 75% of the estimated economic life of the leased asset, (iv) the present value of the minimum lease payments exceeding 90% of the fair value. At the inception of a finance lease, the Company as the lessee records an asset and an obligation at an amount equal to the present value of the minimum lease payments. The leased asset is amortized over the shorter of the lease term or its estimated useful life if title does not transfer to the Company, while the leased asset is depreciated in accordance with the Company’s depreciation policy if the title is to eventually transfer to the Company. The periodic rent payments made during the lease term are allocated between a reduction in the obligation and interest element using the effective interest method in accordance with the provisions of ASC Topic 835-30, “Imputation of Interest”. |
Net loss per share | · Net loss per share The Company calculates net loss per share in accordance with ASC Topic 260, “ Earnings per Share |
Foreign currencies translation | · 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 statement of operations. The reporting currency of the Company is the United States Dollar ("US$"). The Company's subsidiaries in Hong Kong and the PRC maintain their books and records in their local currency, Hong Kong Dollars ("HK$") and Renminbi Yuan (“RMB”), which is the functional currency as being the primary currency of the economic environment in which these entities operate. Convenience translation of amounts from the local currency of the Company into US$ has been made at the pegged exchange rate at 0.129 for the respective years. In general, for consolidation purposes, assets and liabilities of its subsidiaries whose functional currency is not the US$ are translated into US$, in accordance with ASC Topic 830-30, “ Translation of Financial Statement |
Related parties | · 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. |
Segment reporting | · Segment reporting ASC Topic 280, “Segment Reporting” establishes standards for reporting information about operating segments on a basis consistent with the Company’s internal organization structure as well as information about geographical areas, business segments and major customers in financial statements. For the three and six months ended June 30, 2019 and 2018, the Company operates in one reportable operating segment in the Hong Kong. |
Fair value of financial instruments | · Fair value of financial instruments The carrying value of the Company’s financial instruments (excluding short-term bank borrowing and note payable): cash and cash equivalents, accounts and retention 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 short-term bank borrowings and 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. |
Recent accounting pronouncements | · Recent accounting pronouncements In February 2016, the Financial Accounting Standard Board (“FASB”) issued Accounting Standards Update (ASU) No. 2016-02, Leases (Topic 842) (ASU 2016-02), which requires a lessee to recognize most leases on the balance sheet as lease liabilities with corresponding right-of-use assets. The Company adopted ASU 2016-02 utilizing the modified retrospective transition method at the beginning of the first quarter of 2019. As a result of the adoption of ASC 842, the Company recorded finance lease liabilities of $28,333 at the beginning of the first quarter of 2019, with no material impact to the statement of operations. In August 2017, the FASB issued ASU No. 2017-12, Derivatives and Hedging (ASU 2017-12), which is intended to more closely align hedge accounting with companies’ risk management strategies, simplify the application of hedge accounting, and increase transparency regarding the scope and results of hedging programs. The guidance in this update is applied using a cumulative-effect adjustment to retained earnings at the beginning of the fiscal year of adoption. ASU 2017-12 is effective for public business entities for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The adoption of ASU 2017-12 at the beginning of the first quarter of 2019 did not have a significant impact on the Company’s financial statements. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (ASU 2016-13), which changes the accounting for recognizing impairments of financial assets. Under the new guidance, credit losses for certain types of financial instruments will be estimated based on expected losses. The new guidance also modifies the impairment models for available-for-sale debt securities and for purchased financial assets with credit deterioration since their origination. ASU 2016-13 is effective for public business entities for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years, and early adoption is permitted. The Company is currently evaluating the impact that this guidance will have on its financial statements. In January 2017, the FASB issued ASU No. 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (ASU 2017-14). This new guidance eliminates the requirement to calculate the implied fair value of goodwill to measure a goodwill impairment charge. Instead, entities will record an impairment charge based on the excess of a reporting unit’s carrying amount over its fair value. ASU 2017-14 is effective for public business entities for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years, and early adoption is permitted. The Company is currently evaluating the impact that this guidance will have on its financial statements. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement: Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement (ASU 2018-13), which adds and modifies certain disclosure requirements for fair value measurements. Under the new guidance, entities will no longer be required to disclose the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, or valuation processes for Level 3 fair value measurements. However, public business entities will be required to disclose the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and related changes in unrealized gains and losses included in other comprehensive income. ASU 2018-13 is effective for public business entities for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years, and early adoption is permitted. The Company is currently evaluating the impact that this guidance will have on its financial statements. In August 2018, the FASB issued ASU No. 2018-15, Intangibles - Goodwill and Other – Internal-Use Software: Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract (ASU 2018-05). This new guidance requires a customer in a cloud computing arrangement to determine which implementation costs to capitalize as assets or expense as incurred. Capitalized implementation costs related to a hosting arrangement that is a service contract will be amortized over the term of the hosting arrangement, beginning when the module or component of the hosting arrangement is ready for its intended use. ASU 2018-05 is effective for public business entities for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years, and early adoption is permitted. Application of this guidance can be applied either prospectively or retrospectively. The Company is currently evaluating the impact that this guidance will have on its financial statements. |
2. Organization and Business _2
2. Organization and Business Background (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of subsidiaries | Name Place of incorporation and kind of legal entity Principal activities and place of operation Particulars of issued/ registered share capital Effective interest held Lee Tat International Holdings Limited British Virgin Islands Investment holding 50,000 shares at US$1 each 100% Lee Tat Transportation International Limited Hong Kong Logistic and delivery 10,000 ordinary shares for HK$10,000 100% Cosmos Robotor Holdings Limited British Virgin Islands Investment holding 50,000 shares at US$0.001 each 100% AiTeach International Limited Hong Kong AI Business 10,000 ordinary shares for HK$100 100% Hong Kong Healthtech Limited Hong Kong AI Business 5,100 ordinary shares for HK$5,100 51% |
6. Obligation under Finance L_2
6. Obligation under Finance Lease (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Leases [Abstract] | |
Schedule of financed lease | June 30, 2019 December 31, 2018 (Unaudited) (Audited) Finance lease $ 20,396 $ 31,522 Less: interest expense (2,063 ) (3,189 ) $ 18,333 $ 28,333 Current portion 18,333 20,000 Non-current portion – 8,333 Total $ 18,333 $ 28,333 |
7. Income Taxes (Tables)
7. Income Taxes (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
Income tax reconciliation | Six months ended June 30, 2019 2018 Loss before income taxes $ (44,263 ) $ (456,985 ) Statutory income tax rate 8.25% 16.5% Income tax expense at statutory rate (3,651 ) (75,402 ) Tax effect from non-deductible items 818 25,610 Tax effect from non-taxable item – (604 ) Tax effect from deductible items (318 ) (3,545 ) Tax loss carryforwards 3,151 53,941 Income tax expense $ – $ – |
10. Concentrations of Risk (Tab
10. Concentrations of Risk (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Risks and Uncertainties [Abstract] | |
Schedule of customer concentrations | Three months ended June 30, 2019 June 30, 2019 Customers Revenues Percentage Accounts Customer B $ 59,417 43% $ 16,530 Customer A 51,869 38% 18,898 Total: $ 111,286 81% Total: $ 35,428 Three months ended June 30, 2018 June 30, 2018 Customers Revenues Percentage Accounts Customer A $ 120,027 53% $ – Customer B 83,789 37% – Total: $ 203,816 90% Total: $ – For the six months ended June 30, 2019 and 2018, the customers who accounts for 10% or more of the Company’s revenues and its outstanding receivable balances as at year-end dates, are presented as follows: Six months ended June 30, 2019 June 30, 2019 Customers Revenues Percentage Accounts Customer B $ 111,940 42% $ 16,530 Customer A 110,168 41% 18,898 Total: $ 222,108 83% Total: $ 35,428 Six months ended June 30, 2018 June 30, 2018 Customers Revenues Percentage Accounts Customer A $ 197,654 55% $ – Customer B 126,821 35% – Total: $ 324,475 90% Total: $ – |
2. Organization and Business _3
2. Organization and Business Background (Details) | 6 Months Ended |
Jun. 30, 2019 | |
Lee Tat International Holdings Limited [Member] | |
Ownership percentage | 100.00% |
Place of incorporation | British Virgin Islands |
Principal activities | Investment holding |
Registered share capital | 50,000 shares at US$1 each |
Lee Tat Transporation International Limited [Member] | |
Ownership percentage | 100.00% |
Place of incorporation | Hong Kong |
Principal activities | Logistic and delivery |
Registered share capital | 10,000 ordinary shares at HK$10,000 |
Cosmos Robotor Holdings Limited [Member] | |
Ownership percentage | 100.00% |
Place of incorporation | British Virgin Islands |
Principal activities | Investment holding |
Registered share capital | 50,000 shares at US$0.001 each |
AiTeach International Limited [Member] | |
Ownership percentage | 100.00% |
Place of incorporation | Hong Kong |
Principal activities | AIBusiness |
Registered share capital | 10,000 ordinary shares at HK$100 |
Hong Kong Healthtech Limited [Member] | |
Ownership percentage | 51.00% |
Place of incorporation | Hong Kong |
Principal activities | AIBusiness |
Registered share capital | 5,100 ordinary shares for HK $5,100 |
3. Summary of Significant Acc_3
3. Summary of Significant Accounting Policies (Details Narrative) | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2019USD ($) | Mar. 31, 2018USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Dec. 31, 2018USD ($) | |
Allowance for doubtful accounts | $ 0 | $ 0 | |||
Depreciation expense | $ 4,959 | $ 14,100 | 9,917 | $ 34,235 | |
Asset impairment charge | $ 0 | 0 | |||
Uncertain tax positions | 0 | 0 | |||
Finance lease liability | $ 18,333 | $ 28,333 | |||
HONG KONG | |||||
Translation rate | 0.129 | ||||
Service vehicle [Member] | |||||
Expected useful life of property | 8 years |
4. Going Concern Uncertainties
4. Going Concern Uncertainties (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Net loss | $ (115,196) | $ (305,747) | $ (163,961) | $ (456,985) |
Negative operating cash flows | (121,645) | $ (210,001) | ||
Accumulated deficit | $ (287,266) | $ (287,266) |
6. Obligations under Finance Le
6. Obligations under Finance Lease (Details - finance lease) - USD ($) | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2019 | Dec. 31, 2017 | Dec. 31, 2018 | |
Leases [Abstract] | |||
Finance lease, gross | $ 20,396 | $ 31,522 | |
Less: interest expense | (2,063) | $ (3,189) | |
Finance lease, net | 18,333 | 28,333 | |
Finance lease, current | 18,333 | 20,000 | |
Finance lease, non-current | $ 0 | $ 8,333 |
6. Obligations under Finance _2
6. Obligations under Finance Lease (Details Narrative) | 6 Months Ended |
Jun. 30, 2019 | |
Leases [Abstract] | |
Effective interest rate | 2.25% |
Lease expiration date | May 29, 2020 |
7. Income Taxes (Details - Inco
7. Income Taxes (Details - Income tax reconcilation) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Income tax expense | $ 0 | $ 0 | $ 0 | $ 0 |
Hong Kong Profits Tax [Member] | ||||
Loss before income taxes | $ (44,263) | $ (456,985) | ||
Statutory income tax rate | 8.25% | 16.50% | ||
Income tax expense at statutory rate | $ (3,651) | $ (75,402) | ||
Tax effect from non-deductible items | 818 | 25,610 | ||
Tax effect from non-taxable item | 0 | (604) | ||
Tax effect from deductible items | (318) | (3,545) | ||
Tax loss carryforwards | 3,151 | 53,941 | ||
Income tax expense | $ 0 | $ 0 |
7. Income Taxes (Details Narrat
7. Income Taxes (Details Narrative) | 6 Months Ended |
Jun. 30, 2019USD ($) | |
Income Tax Disclosure [Abstract] | |
Net operating loss carryforward | $ 2,155,600 |
NOL expiration date | Dec. 31, 2039 |
Deferred tax valuation allowance | $ 452,676 |
8. Stockholders' Equity (Detail
8. Stockholders' Equity (Details Narrative) - shares | Jun. 30, 2019 | Dec. 31, 2018 |
Equity [Abstract] | ||
Common stock issued | 21,492,933 | 21,492,933 |
Common stock outstanding | 21,492,933 | 21,492,933 |
10. Concentrations of Risk (Det
10. Concentrations of Risk (Details - Concentration risk) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Revenues | $ 137,546 | $ 225,147 | $ 265,548 | $ 358,873 | |
Accounts receivable | 41,981 | 41,981 | $ 54,096 | ||
Sales Revenue, Net [Member] | |||||
Revenues | $ 111,286 | $ 203,816 | $ 222,108 | $ 324,475 | |
Concentration risk percentage | 81.00% | 90.00% | 83.00% | 90.00% | |
Sales Revenue, Net [Member] | Customer B [Member] | |||||
Revenues | $ 59,417 | $ 83,789 | $ 111,940 | $ 126,821 | |
Concentration risk percentage | 43.00% | 37.00% | 42.00% | 35.00% | |
Sales Revenue, Net [Member] | Customer A [Member] | |||||
Revenues | $ 51,869 | $ 120,027 | $ 110,168 | $ 197,654 | |
Concentration risk percentage | 38.00% | 53.00% | 41.00% | 55.00% | |
Accounts Receivable [Member] | |||||
Accounts receivable | $ 35,428 | $ 0 | $ 35,428 | $ 0 | |
Accounts Receivable [Member] | Customer B [Member] | |||||
Accounts receivable | 16,530 | 0 | 16,530 | 0 | |
Accounts Receivable [Member] | Customer A [Member] | |||||
Accounts receivable | $ 18,898 | $ 0 | $ 18,898 | $ 0 |
10. Concentrations of Risk (D_2
10. Concentrations of Risk (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Cost of sales | $ 131,350 | $ 222,951 | $ 224,019 | $ 342,281 |
Cost of Sales [Member] | Vendor C [Member] | ||||
Concentration risk percentage | 13.00% | 14.00% | 13.00% | 14.00% |
Cost of sales | $ 23,247 | $ 14,542 | $ 29,692 | $ 47,258 |
Accounts Payable [Member] | Vendor C [Member] | ||||
Accounts payable | $ 1,808 | $ 0 | $ 1,808 | $ 0 |