Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Mar. 31, 2020 | Jul. 06, 2020 | Sep. 30, 2019 | |
Document And Entity Information | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Mar. 31, 2020 | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Entity Registrant Name | Senmiao Technology Ltd | ||
Entity Central Index Key | 0001711012 | ||
Current Fiscal Year End Date | --03-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Public Float | $ 6,302,929 | ||
Trading Symbol | AIHS | ||
Entity Common Stock, Shares Outstanding | 28,839,803 | ||
Entity Shell Company | false | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | false | ||
Entity Interactive Data Current | Yes | ||
Security Exchange Name | NASDAQ | ||
Title of 12(b) Security | Common Stock |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Mar. 31, 2020 | Mar. 31, 2019 |
Current Assets | ||
Cash and cash equivalents | $ 833,888 | $ 3,967,980 |
Accounts receivable, net, current portion | 660,645 | 199,909 |
Inventories | 1,000,675 | 1,508,244 |
Finance lease receivables, net, current portion | 459,110 | 10,254 |
Prepayments, other receivables and other assets, net | 2,798,780 | 3,787,254 |
Escrow receivable due within one year | 0 | 600,000 |
Due from related parties | 26,461 | 140,498 |
Current assets - discontinued operations | 826,580 | 1,185,016 |
Total Current Assets | 6,606,139 | 11,399,155 |
Property and equipment, net | ||
Property and equipment, net | 469,201 | 100,680 |
Property and equipment, net - discontinued operations | 11,206 | 25,205 |
Total Property and equipment, net | 480,407 | 125,885 |
Other Assets | ||
Operating lease right-of-use assets, net | 473,661 | 0 |
Operating lease right-of-use assets, net, related parties | 236,305 | 0 |
Financing lease right-of-use assets, net | 5,440,362 | 0 |
Intangible assets, net | 777,621 | 1,627 |
Prepayment for intangible assets | 0 | 280,000 |
Accounts receivable, net, noncurrent | 882,078 | 0 |
Finance lease receivables, net, noncurrent portion | 734,145 | 22,298 |
Other assets - discontinued operations | 0 | 485,170 |
Total Other Assets | 8,544,172 | 789,095 |
Total Assets | 15,630,718 | 12,314,135 |
Current Liabilities | ||
Borrowings from financial institutions | 226,753 | 219,157 |
Borrowings from third parties | 0 | 476,765 |
Accounts payable | 4,065 | 0 |
Advance from customers | 90,349 | 31,776 |
Income tax payable | 16,267 | 21,905 |
Accrued expenses and other liabilities | 2,008,391 | 962,291 |
Due to related parties and affiliates | 152,679 | 415,931 |
Operating lease liabilities | 149,582 | 0 |
Operating lease liabilities - related parties | 151,655 | 0 |
Financing lease liabilities | 3,473,967 | 0 |
Derivative liabilities | 342,530 | 0 |
Current liabilities - discontinued operations | 4,516,292 | 1,625,779 |
Total Current Liabilities | 11,132,530 | 3,753,604 |
Other Liabilities | ||
Borrowings from financial institutions, noncurrent | 64,221 | 177,789 |
Operating lease liabilities, noncurrent | 297,167 | 0 |
Operating lease liabilities, noncurrent - related parties | 88,349 | 0 |
Financing lease liabilities, noncurrent | 2,576,094 | 0 |
Total Other Liabilities | 3,025,831 | 177,789 |
Total liabilities | 14,158,361 | 3,931,393 |
Commitments and Contingencies | ||
Stockholders' Equity | ||
Common stock (par value $0.0001 per share, 100,000,000 shares authorized; 29,008,818 and 25,945,255 shares issued and outstanding at March 31, 2020 and 2019, respectively) | 2,901 | 2,595 |
Additional paid-in capital | 27,013,137 | 23,833,112 |
Accumulated deficit | (23,704,863) | (15,031,538) |
Accumulated other comprehensive loss | (507,478) | (428,771) |
Total Senmiao Technology Limited Stockholders' Equity | 2,803,697 | 8,375,398 |
Noncontrolling interests | (1,331,340) | 7,344 |
Total Equity | 1,472,357 | 8,382,742 |
Total Liabilities and Equity | $ 15,630,718 | $ 12,314,135 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2020 | Mar. 31, 2019 |
CONSOLIDATED BALANCE SHEETS | ||
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 |
Common Stock, Shares Authorized | 100,000,000 | 100,000,000 |
Common Stock, Shares, Issued | 29,008,818 | 25,945,255 |
Common Stock, Shares, Outstanding | 29,008,818 | 25,945,255 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS | ||
Revenues | $ 15,655,575 | $ 2,551,107 |
Cost of revenues | (12,280,238) | (1,812,187) |
Gross profit | 3,375,337 | 738,920 |
Operating expenses | ||
Selling, general and administrative expenses | (5,567,939) | (1,776,690) |
Bad debt expense | (3,404,336) | (5,077) |
Total operating expenses | (8,972,275) | (1,781,767) |
Loss from operations | (5,596,938) | (1,042,847) |
Other income (expense) | ||
Other expense, net | (45,347) | (57,145) |
Interest expense | (96,624) | (33,878) |
Interest expense on finance leases | (373,407) | 0 |
Change in fair value of derivative liabilities | 1,796,724 | 0 |
Total other income (expense), net | 1,281,346 | (91,023) |
Loss before income taxes | (4,315,592) | (1,133,870) |
Income tax expenses | (33,184) | (21,905) |
Net loss from continuing operations | (4,348,776) | (1,155,775) |
Net loss from discontinued operations, net of applicable income taxes | (5,587,027) | (3,386,750) |
Net loss | (9,935,803) | (4,542,525) |
Net loss (income) attributable to noncontrolling interests from continuing operations | 1,262,478 | (7,344) |
Net loss attributable to stockholders | (8,673,325) | (4,549,869) |
Other comprehensive loss | ||
Foreign currency translation adjustment | (154,913) | (175,010) |
Comprehensive loss | (10,090,716) | (4,717,535) |
Total comprehensive loss (income) attributable to noncontrolling interests | 1,338,684 | (7,344) |
Total comprehensive loss attributable to stockholders | $ (8,752,032) | $ (4,724,879) |
Weighted average number of common stock | ||
Basic and diluted | 28,023,498 | 25,882,287 |
Loss per share - basic and diluted | ||
Continuing operations | $ (0.11) | $ (0.05) |
Discontinued operations | $ (0.20) | $ (0.13) |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) | Common stock [Member]Series B Warrants [Member] | Common stock [Member] | Additional paid-in capital [Member] | Accumulated deficit [Member] | Accumulated other comprehensive loss [Member] | Non-controlling interest [Member] | Total |
Beginning balance at Mar. 31, 2018 | $ 2,588 | $ 23,611,512 | $ (10,481,669) | $ (253,761) | $ 0 | $ 12,878,670 | |
Beginning balance (in shares) at Mar. 31, 2018 | 25,879,400 | ||||||
Capital contribution from noncontrolling interests of the subsidiary acquired | $ 0 | 157,642 | 0 | 0 | 0 | 157,642 | |
Gain from acquisition of variable interest entities | 0 | 63,965 | 0 | 0 | 0 | 63,965 | |
Issuance of common stock pursuant to exercise of underwriter's warrants granted in IPO | $ 7 | (7) | 0 | 0 | 0 | 0 | |
Issuance of common stock pursuant to exercise of underwriter's warrants granted in IPO (in shares) | 65,855 | ||||||
Net loss | $ 0 | 0 | (4,549,869) | 0 | 7,344 | (4,542,525) | |
Foreign currency translation adjustment | 0 | 0 | 0 | (175,010) | 0 | (175,010) | |
Ending balance at Mar. 31, 2019 | $ 2,595 | 23,833,112 | (15,031,538) | (428,771) | 7,344 | 8,382,742 | |
Ending balance (in shares) at Mar. 31, 2019 | 25,945,255 | ||||||
Issuance of common stock in registered direct offering net of issuance costs | $ 178 | 1,991,940 | 0 | 0 | 0 | 1,992,118 | |
Issuance of common stock in registered direct offering net of issuance costs (in shares) | 1,113,187 | 1,781,360 | |||||
Exercise of Series B warrants into common stock | $ 111 | 1,010,752 | 0 | 0 | 0 | 1,010,863 | |
Exercise of Series B warrants into common stock (in shares) | 1,113,188 | ||||||
Net loss | $ 0 | 0 | (8,673,325) | 0 | (1,262,478) | (9,935,803) | |
Issuance of restricted stock units | $ 17 | 177,333 | 0 | 0 | 0 | 177,350 | |
Issuance of restricted stock units (in shares) | 169,015 | ||||||
Foreign currency translation adjustment | $ 0 | 0 | 0 | (78,707) | (76,206) | (154,913) | |
Ending balance at Mar. 31, 2020 | $ 2,901 | $ 27,013,137 | $ (23,704,863) | $ (507,478) | $ (1,331,340) | $ 1,472,357 | |
Ending balance (in shares) at Mar. 31, 2020 | 29,008,818 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash Flows from Operating Activities: | ||
Net loss | $ (9,935,803) | $ (4,542,525) |
Net loss from discontinued operations | (5,587,027) | (3,386,750) |
Net loss from continuing operations | (4,348,776) | (1,155,775) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization of property and equipment | 103,009 | 12,247 |
Stock compensation expense | 133,150 | 44,200 |
Amortization of right-of-use assets | 1,553,523 | 0 |
Amortization of intangible assets | 283 | 0 |
Bad debt expense | 3,404,336 | 5,077 |
Impairment loss of right-of-use assets | 70,984 | 0 |
Loss on disposal of an equipment | 3,608 | 0 |
Change in fair value of derivative liabilities | (1,796,724) | 0 |
Change in operating assets and liabilities | ||
Accounts receivable | (3,047,955) | (148,249) |
Inventories | 437,012 | (1,491,928) |
Prepayments, other receivables and other assets | (964,889) | (1,952,696) |
Finance lease receivables | (1,185,031) | 0 |
Accounts payable | 4,144 | 0 |
Advances from customers | 61,409 | 12,725 |
Income tax payable | (4,582) | 21,905 |
Accrued expenses and other liabilities | 1,138,316 | 99,515 |
Operating lease liabilities | (94,235) | 0 |
Operating lease liabilities - related parties | 2,125 | 0 |
Net cash used in operating activities from continuing operations | (4,530,293) | (4,552,979) |
Net cash used in operating activities from discontinued operations | (1,917,371) | (1,703,247) |
Net Cash Used in Operating Activities | (6,447,664) | (6,256,226) |
Cash Flows from Investing Activities: | ||
Purchases of property and equipment | (495,241) | (1,365) |
Purchases of intangible assets | (470,000) | (280,869) |
Addition in finance lease receivable | 0 | (32,200) |
Net cash used in investing activities from continuing operations | (965,241) | (314,434) |
Net cash provided by (used in) investing activities from discontinued operations | 1,825 | (218,191) |
Net Cash Used in Investing Activities | (963,416) | (532,625) |
Cash Flows from Financing Activities: | ||
Net proceeds from issuance of common stock in registered direct offering | 5,142,124 | 0 |
Net proceeds from issuance of common stock upon warrants exercised | 111 | 0 |
Borrowings from financial instituitions | 55,159 | 0 |
Repayments to stockholders | 0 | (1,900,000) |
Repayments to third parties | (604,562) | 0 |
Repayments from related parties | 108,566 | 0 |
Borrowings from related parties and affiliates | 1,305,166 | 471,608 |
Repayments to related parties and affiliates | (1,405,356) | (487,115) |
Repayments of current borrowings from financial institutions | (145,048) | 0 |
Repayments of noncurrent borrowings from financial institutions | 0 | (175,581) |
Release of escrow receivable | 600,000 | 600,000 |
Principal payments of finance lease liabilities | (975,958) | 0 |
Cash acquired from acquisition | 0 | 218,816 |
Net cash provided by (used in) financing activities from continuing operations | 4,080,202 | (1,272,272) |
Net cash (used in) provided by financing activities from discontinued operations | (648,405) | 1,973,479 |
Net Cash Provided by Financing Activities | 3,431,797 | 701,207 |
Effect of exchange rate changes on cash and cash equivalents | (197,200) | (33,412) |
Net decrease in cash and cash equivalents | (4,176,483) | (6,121,056) |
Cash and cash equivalents, beginning of year | 5,020,510 | 11,141,566 |
Cash and cash equivalents, end of year | 844,027 | 5,020,510 |
Less: Cash and cash equivalents from discontinued operations | (10,139) | (1,052,530) |
Cash and cash equivalents from continuing operations, end period | 833,888 | 3,967,980 |
Supplemental Cash Flow Information | ||
Cash paid for interest expense | 96,624 | 33,878 |
Cash paid for income tax | 0 | 0 |
Non-cash Transaction in Investing and Financing Activities | ||
IPO expenses paid by the Company's stockholders | 0 | 70,687 |
Assume of net liabilities of Ruixi, excluding cash and cash equivalents | 0 | (149,680) |
Prepayment in exchange of intangible assets | 280,000 | 0 |
Right-of-use assets obtained in exchange of operating lease liabilities | 549,679 | 0 |
Right-of-use assets obtained in exchange of lease liabilities - related parties | 343,819 | 0 |
Allocation of fair value of derivative liabilities for issuance of common stock proceeds | 3,150,006 | 0 |
Allocation of fair value of derivative liabilities to additional paid in capital upon warrants exercised | 1,010,752 | 0 |
Issuance of restricted stock units from accrued expenses and other liabilities | $ 44,200 | $ 0 |
ORGANIZATION AND PRINCIPAL ACTI
ORGANIZATION AND PRINCIPAL ACTITIVIES | 12 Months Ended |
Mar. 31, 2020 | |
ORGANIZATION AND PRINCIPAL ACTITIVIES | |
ORGANIZATION AND PRINCIPAL ACTITIVIES | 1. ORGANIZATION AND PRINCIPAL ACTITIVIES Senmiao Technology Limited (the “Company”) is a U.S. holding Company incorporated in the State of Nevada on June 8, 2017. The Company provides automobile transaction and related services focusing on the ride-hailing industry in the People's Republic of China ("PRC" or "China") through its majority owned subsidiary, Hunan Ruixi Financial Leasing Co., Ltd. (“Hunan Ruixi”), a PRC limited liability Company, its wholly owned subsidiary, Hunan Ruixi Automobile Leasing Co., Ltd. (“Ruixi Leasing”), and its variable interest entity ("VIE"), Sichuan Jinkailong Automobile Leasing Co., Ltd. ("Jinkailong"). The Company operated an online lending platform in China through its VIE, Sichuan Senmiao Ronglian Technology Co., Ltd. ("Sichuan Senmiao"), which facilitated peer-to-peer ("P2P") loan transactions between Chinese investors and individual and small-to-medium-sized enterprise borrowers. The Company ceased its online lending services business in October 2019 and commenced a process of winding down such business. On September 25, 2016, Sichuan Senmiao acquired a P2P platform (including website, internet content provider license, operating systems, servers, and management system) from Sichuan Chenghexin Investment and Asset Management Co., Ltd. On July 28, 2017, the Company established a wholly-owned subsidiary, Sichuan Senmiao Zecheng Business Consulting Co., Ltd. (“Senmiao Consulting”) in China. Sichuan Senmiao was established in China in June 2014. On September 18, 2017, the Company, through Senmiao Consulting, entered into a series of agreements (“VIE Agreements”) with Sichuan Senmiao and its equity holders (the “Sichuan Senmiao Shareholders”) to obtain control and became the primary beneficiary of Sichuan Senmiao (the “Restructuring”). In connection with the Restructuring, as partial consideration for the Sichuan Senmiao Shareholders’ commitment to perform their obligations under the VIE Agreements, the Company issued an aggregate of 45,000,000 shares of its common stock to the Sichuan Senmiao Shareholders pursuant to certain subscription agreements dated September 18, 2017. The Company conducted its P2P business transactions through the Sichuan Senmiao, the VIE. The P2P business was discontinued on October 17, 2019. On October 17, 2019, the Board of Directors of the Company (the "Board") approved a plan (the "Plan") prepared by the Company's executive officers for the Company to discontinue and wind down its online P2P lending services business. In connection with the Plan, the Company ceased facilitation of loan transactions on its online lending platform and assumed all the outstanding loans from investors on the platform. The decision and action taken by the Company to discontinue the online P2P lending services business represents a major shift that will have a material effect on the Company's operations and financial results, which triggers discontinued operations accounting in accordance with ASC 205-20-45. See Note 4 - discontinued operations. On November 21, 2018, as part of its entry into the automobile transaction business, the Company entered into an Investment and Equity Transfer Agreement (the “Investment Agreement”) with Hunan Ruixi and all the shareholders of Hunan Ruixi (“Hunan Ruixi Shareholders”), pursuant to which the Company acquired from the Hunan Ruixi Shareholders an aggregate of 60% of the equity interest of Hunan Ruixi. The Company closed the acquisition on November 22, 2018 and agreed to make a cash contribution of $6,000,000 to Hunan Ruixi, representing 60% of its registered capital, in accordance with the Investment Agreement (Note 3). In June 30, 2019, the Company made the full cash contributions in the aggregate amount of $6,000,000 to Hunan Ruixi. Hunan Ruixi holds a business license for automobile sales and financial leasing and has been engaged in automobile financial leasing services and automobile sales since January 2019. Hunan Ruixi also controls Jinkailong through its 35% equity interest and voting agreements with Jinkailong’s other shareholders. Jinkailong facilitates automobile sales and financing transactions for its clients, who are primarily ride-hailing drivers and provides them relevant after- transaction services. In March 2019, Hunan Ruixi began its financing leasing operation. In May 2019, the Company formed a wholly owned subsidiary, Yicheng Financial Leasing Co., Ltd. ("Yicheng"), with a registered capital of $50 million in Chengdu City, Sichuan Province. Yicheng obtained its business licenses for automobiles sale and financial leasing on May 5, 2019. Yicheng has been engaged in automobile sales since June 2019. On July 5, 2019, Yicheng entered into an Investment and Equity Transfer Agreement with Chengdu Mashangchuxing Automobile Leasing Co., Ltd. ("Mashang Chuxing"), Chengdu Yunche Chixun Business Consulting Co., Ltd. ("Yunche Chixun"), Mr. Zhiqiu Xia and all the shareholders of Mashang Chuxing ("Mashang Chuxing Shareholders"), pursuant to which, Yicheng, Yunche Chixun, Mr. Zhiqiu Xia acquired from the Mashang Chuxing Shareholders 49%, 5% and 46% of the equity interests of Mashang Chuxing for no consideration, respectively. On March 18, 2020, Yicheng, Yunche Chixun, Mr. Zhiqiu Xia entered into equity transfer agreements with Sichuan Dinghengxin Automobile Service Co., Ltd ("Dinghengxin"), respectively, pursuant to which, Yicheng, Yunche Chixun, Mr. Zhiqiu Xia transferred all the equity interests of Mashang Chuxing to Dinghengxin with no consideration. As of the date of the financial statements, none of the shareholders of Mashang Chuxing made capital contribution. Mashang Chuxing commenced providing ride-hailing services in August 2019 and has suffered loss of approximately $4,400 due to limited operations. The following diagram illustrates the Company’s corporate structure, including its subsidiaries, and VIEs, as of the date of these financial statements: VIE Agreements with Sichuan Senmiao According to the VIE Agreements, Sichuan Senmiao is obligated to pay Senmiao Consulting service fees equal to its net income. Sichuan Senmiao’s entire operations are controlled by the Company. Although the Company discontinued Sichuan Senmiao's online P2P lending services business commencing in October 2019, the VIE Agreements remain in place, and such agreements are described in detail below: Equity Interest Pledge Agreement Senmiao Consulting, Sichuan Senmiao and the Sichuan Senmiao Shareholders entered into an Equity Interest Pledge Agreement, pursuant to which the Sichuan Senmiao Shareholders pledged all of their equity interest in Sichuan Senmiao to Senmiao Consulting in order to guarantee the performance of Sichuan Senmiao’s obligations under the Exclusive Business Cooperation Agreement as described below. During the term of the pledge, Senmiao Consulting is entitled to receive any dividends declared on the pledged equity interest of Sichuan Senmiao. The Equity Interest Pledge Agreement terminates when all contractual obligations under the Exclusive Business Cooperation Agreement have been fully performed. Exclusive Business Cooperation Agreement Pursuant to an Exclusive Business Cooperation Agreement entered by and among the Company, Senmiao Consulting, Sichuan Senmiao and each of Sichuan Senmiao Shareholders, Senmiao Consulting will provide Sichuan Senmiao with complete technical support, business support and related consulting services for 10 years ended September 18, 2027. The Sichuan Senmiao Shareholders and Sichuan Senmiao will not engage any third party for the same or similar consultation services without Senmiao Consulting’s prior consent. Further, the Sichuan Senmiao Shareholders are entitled to receive an aggregate of 20,250,000 shares of common stock of the Company under the Exclusive Business Cooperation Agreement. Senmiao Consulting may terminate the Exclusive Business Cooperation Agreement at any time upon prior written notice to Sichuan Senmiao and the Sichuan Senmiao Shareholders. Exclusive Option Agreement Pursuant to an Exclusive Option Agreement entered by and among Senmiao Consulting, Sichuan Senmiao and the Sichuan Senmiao Shareholders, the Sichuan Senmiao Shareholders have granted Senmiao Consulting an exclusive option to purchase at any time their equity interests in Sichuan Senmiao at a purchase price equal to the capital paid by the Sichuan Senmiao Shareholders in whole or at a pro-rated price for any partial purchase. The Exclusive Option Agreement terminates after 10 years ending September 18, 2027 but can be renewed by Senmiao Consulting at its discretion. Powers of Attorney Each of the Sichuan Senmiao Shareholders has signed a power of attorney (the “Power of Attorney”), pursuant to which, each of the Sichuan Senmiao Shareholders has authorized Senmiao Consulting to act as his or her exclusive agent and attorney with respect to all rights of such individual as a shareholder of Sichuan Senmiao, including but not limited to: (a) attending shareholders’ meetings; (b) exercising all the shareholder’s rights that shareholders are entitled to under PRC laws and the Articles of Association of Sichuan Senmiao, including but not limited to voting, sale, transfer, pledge and disposition of the equity interests of Sichuan Senmiao; and (c) designating and appointing the legal representative, chairperson, director, supervisor, chief executive officer and other senior management members of Sichuan Senmiao. The Power of Attorney has the same term as the Exclusive Option Agreement. Timely Report Agreement The Company and Sichuan Senmiao entered into a Timely Report Agreement, pursuant to which, Sichuan Senmiao agrees to make its officers and directors available to the Company and promptly provide all information required by the Company so that the Company can make necessary filings to the U.S. Securities and Exchange Commission (“SEC”) and other regulatory reports in a timely fashion. The Company has concluded that it should consolidate the financial statements with Sichuan Senmiao because it is Sichuan Senmiao’s primary beneficiary based on the Power of Attorney from the Sichuan Senmiao Shareholders, who assigned their rights as shareholders of Sichuan Senmiao to Senmiao Consulting, the Company’s wholly-owned subsidiary. These rights include, but are not limited to, attending shareholders’ meetings, voting on matters submitted for shareholder approval and appointing legal representatives, directors, supervisors and senior management of Sichuan Senmiao. As a result, the Company, through Senmiao Consulting, is deemed to hold all of the voting equity interests in Sichuan Senmiao. Pursuant to Exclusive Business Cooperation Agreement, Senmiao Consulting shall provide complete technical support, business support and related consulting services for 10 years. Though not explicit in the VIE Agreements, the Company may provide financial support to Sichuan Senmiao to meet its working capital requirements and capitalization purposes. The terms of the VIE Agreements and the Company’s plan to provide financial support to Sichuan Senmiao were considered in determining that the Company is the primary beneficiary of Sichuan Senmiao. Accordingly, the financial statements of Sichuan Senmiao are consolidated in the accompanying consolidated financial statements. Voting Agreement with Jinkailong’s Other Shareholders Hunan Ruixi entered into two voting agreements signed in August 2018 and February 2020, respectively, as amended (the "Voting Agreement"), with Jinkailong and other Jinkailong’s shareholders holding an aggregate of 65% equity interests and obtained 35% equity interests in Jinkailong. Pursuant to the Voting Agreements, all other Jinkailong’s shareholders will vote in concert with Hunan Ruixi on all fundamental corporate transactions in the event of a disagreement for periods of 20 years and 18 years, respectively, ending on August 25, 2038. The Company has concluded that it should consolidate the financial statements with Jinkailong because it is Jinkailong’s primary beneficiary based on the Voting Agreement. Though not explicit in the Voting Agreement by and among Jinkailong, Hunan Ruixi, and other shareholders of Hunan Ruixi, the Company may provide financial support to Jinkailong to meet its working capital requirements and capitalization purposes. The terms of the Voting Agreement and the Company’s plan to provide financial support to Jinkailong were considered in determining that the Company is the primary beneficiary of Jinkailong. Accordingly, management has determined that Jinkailong is a VIE and the financial statements of Jinkailong are consolidated in the Company’s consolidated financial statements. Total assets and total liabilities of the Company’s VIEs included in the Company’s consolidated financial statements as of March 31, 2020 and 2019 are as follows: March 31, March 31, 2020 2019 Total assets from continuing operations $ 8,639,858 $ 4,130,435 Total assets from discontinued operations (1) 1,418,080 1,083,579 Total assets $ 10,057,938 $ 5,214,014 Total liabilities from continuing operations $ 13,629,449 $ 6,456,098 Total liabilities from discontinued operations (2) 7,598,981 396,671 Total liabilities $ 21,228,430 $ 6,852,769 (1) Includes intercompany receivables of $543,446 and $613,730 as of March 31, 2020 and 2019, respectively. (2) Includes intercompany payables of $402,406 and $0 as of March 31, 2020 and 2019, respectively Net revenue, loss from operations and net loss of the VIEs that were included in the Company’s consolidated financial statements for the years ended March 31, 2020 and 2019 are as follows: For the Years Ended March 31, 2020 2019 Net revenue from continuing operations $ 3,483,078 $ 1,087,207 Net revenue from discontinued operations $ 308,102 $ 369,956 Loss from operations from continuing operations $ (4,514,195) $ (152,804) Loss from operations from discontinued operations $ (822,470) $ (2,444,991) Net income (loss) from continuing operations attributable to stockholders (3,786,057) 63,702 Net loss from discontinued operations attributable to stockholders (4,692,725) (2,442,908) Net loss attributable to stockholders $ (8,478,782) $ (2,379,206) |
GOING CONCERN
GOING CONCERN | 12 Months Ended |
Mar. 31, 2020 | |
GOING CONCERN | |
GOING CONCERN | 2. In assessing the Company’s liquidity, the Company monitors and analyzes its cash on-hand and its operating and capital expenditure commitments. The Company’s liquidity needs are to meet its working capital requirements, operating expenses and capital expenditure obligations. Debt financing from financial institutions and equity financings have been utilized to finance the working capital requirements of the Company. Since January 2020, all provinces across the mainland China have confirmed thousands of infection cases of the novel coronavirus (COVID-19). The epidemic has resulted in quarantines, travel restrictions, and the temporary closure of stores and business facilities in China, which has significantly impacted the Chinese economy. In March 2020, the World Health Organization declared the COVID-19 as a pandemic. Given the rapidly expanding nature of the COVID-19 pandemic, the Company’s business, results of operations, and financial condition will be adversely affected. The extent of such impact will depend largely on future developments, which are highly uncertain, including the severity of the outbreak and future government measures in response to the outbreak, among other things. As a result, there can be no assurance that the Company will be able to successfully implement its growth strategies. The Company’s management has considered whether there is substantial doubt about its ability to continue as a going concern due to the Company’s (1) recurring losses from operations, including approximately $3.1 million and $5.6 million net loss attributable to the Company’s stockholders from continuing operations and discontinued operations, respectively, for the year ended March 31, 2020, (2) accumulated deficit of approximately $23.7 million as of March 31, 2020; (3) the negative working capital of $4.5 million and (4) negative operating cash flows of approximately $4.5 million and $2.0 million from continuing operations and discontinued operations, respectively, for the year ended March 31, 2020. Management has determined there is substantial doubt about its ability to continue as a going concern. Management is trying to alleviate the going concern risk through the following sources: · cash and cash equivalents generated from operations; and · the Company will continuously seek equity financing to support its working capital. If the Company is unable to generate significant operating cash flows or secure additional debt and equity financing, the Company may be required to cease or curtail its operations. The Company’s consolidated financial statements do not include adjustments that might result from the outcome of these uncertainties. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Mar. 31, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (a) Basis of presentation The accompanying consolidated financial statements of the Company has been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). (b) Basis of consolidation The consolidated financial statements include the accounts of the Company and include the assets, liabilities, revenues and expenses of the subsidiaries and VIEs. All inter-Company accounts and transactions have been eliminated in consolidation. (c) Foreign currency translation Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing on 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 on the date of the balance sheet. The resulting exchange differences are recorded in the statement of operations. The reporting currency of the Company and its subsidiaries and VIEs is U.S. dollars (“US$”) and the accompanying consolidated financial statements have been expressed in US$. However, the Company maintains the books and records in its functional currency, Chinese Renminbi (“RMB”), being the functional currency of the economic environment in which its operations are conducted. In general, for consolidation purposes, assets and liabilities of the Company and its subsidiaries whose functional currency is not the US$, are translated into US$, using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements of the Company and its subsidiaries and VIEs are recorded as a separate component of accumulated other comprehensive income within the statement of stockholders’ equity. Translation of amounts from RMB into US$ has been made at the following exchange rates for the respective periods: March 31, March 31, 2020 2019 Balance sheet items, except for equity accounts 7.0824 6.7119 For the Years Ended March 31, 2020 2019 Items in the statements of operations and comprehensive loss, and statements of cash flows 6.9472 6.7008 (d) Use of estimates In presenting the consolidated financial statements in accordance with U.S. GAAP, management make estimates and assumptions that affect the amounts reported and related disclosures. Estimates, by their nature, are based on judgement and available information. Accordingly, actual results could differ from those estimates. On an ongoing basis, management reviews these estimates and assumptions using the currently available information. Changes in facts and circumstances may cause the Company to revise its estimates. The Company bases its estimates on past experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. The inputs into our judgments and estimates consider the economic implications of COVID-19 on the Company’s critical and significant accounting estimates. Estimates are used when accounting for items and matters including, but not limited to, revenue recognition, residual values, lease classification and liabilities, finance lease receivables, inventory obsolescence, right-of-use assets, determinations of the useful lives and valuation of long-lived assets, estimates of allowances for doubtful accounts and prepayments, estimates of impairment of intangible assets, valuation of deferred tax assets, estimated fair value used in business acquisitions, valuation of derivative liabilities, allocation of fair value of derivative liabilities issuance of common stock and warrants exercised and other provisions and contingencies. (e) Fair values of financial instruments Accounting Standards Codification (“ASC”) Topic 825, Financial Instruments (“Topic 825”) requires disclosure of fair value information of financial instruments, whether or not recognized in the balance sheets, for which it is practicable to estimate that value. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. Topic 825 excludes certain financial instruments and all nonfinancial assets and liabilities from its disclosure requirements. Accordingly, the aggregate fair value amounts do not represent the underlying value of the Company. The three levels of valuation hierarchy are defined as follows: Level 1 Inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2 Inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the assets or liability, either directly or indirectly, for substantially the full term of the financial instruments. Level 3 Inputs to the valuation methodology are unobservable and significant to the fair value. The following table sets forth by level within the fair value hierarchy our financial assets and liabilities that were accounted for at fair value on a recurring basis as of March 31, 2020: Carrying Value at Fair Value Measurement at March 31, 2020 March 31, 2020 Level 1 Level 2 Level 3 Derivative liabilities $ 342,530 $ — $ — $ 342,530 The following is a reconciliation of the beginning and ending balance of the assets and liabilities measured at fair value on a recurring basis for the year ended March 31, 2020: March 31, 2020 Beginning balance $ — Derivative liabilities recognized at grant date on June 20, 2019 3,150,006 Change in fair value of derivative liabilities (1,796,724) Fair value of Series B warrants exercised (1,010,752) Ending balance $ 342,530 On June 21, 2019, the Company closed a registered direct offering of an aggregate of 1,781,361 shares of common stock, and in connection therewith, issued to the investors (i) for no additional consideration, Series A warrants to purchase up to an aggregate of 1,336,021 shares of common stock, (ii) for nominal additional consideration, Series B warrants to purchase up to a maximum aggregate of 1,116,320 shares of common stock and (iii) placement agent warrants to purchase up to 142,509 shares of common stock. The strike price of the Company's Series A and Series B warrants and the placement agent warrants are denominated in US$and the Company's functional currency is RMB, therefore, those warrant shares are not considered indexed to the Company's own stock which should be classified as derivative liability. The Company's Series A and Series B warrants and the placement agent warrants are not traded in an active securities market; therefore, the Company estimates the fair value to those warrants using the Black-Scholes valuation model on June 20, 2019 (the grant date) and March 31, 2020. June 20, 2019 Series A Series B Placement Agent Warrants Warrants Warrants # of shares exercisable 1,336,021 1,116,320 142,509 Valuation date 6/20/2019 6/20/2019 6/20/2019 Exercise price $ 3.72 $ 3.72 $ 3.38 Stock price $ 2.80 $ 2.80 $ 2.80 Expected term (year) 4.00 1.00 4.00 Risk-free interest rate 1.77 % 1.91 % 1.77 % Expected volatility 86 % 91 % 86 % March 31, 2020 Series A Series B Placement Agent Warrants Warrants Warrants # of shares exercisable 1,336,021 3,132 142,509 Valuation date 3/31/2020 3/31/2020 3/31/2020 Exercise price $ 1.50 $ 0.0001 $ 3.38 Stock price $ 0.44 $ 0.44 $ 0.44 Expected term (year) 3.22 0.22 3.22 Risk-free interest rate 0.30 % 0.11 % 0.30 % Expected volatility 122 % 127 % 122 % As of March 31, 2020 and 2019, financial instruments of the Company comprised primarily current assets and current liabilities including cash and cash equivalents, accounts receivable, finance lease receivables, prepayments, other receivables and other assets, escrow receivables, due from related parties, borrowings from financial institutions and third parties, accounts payable, advance from customers, lease liabilities, accrued expenses and other liabilities, due to stockholders and due to related parties and affiliates, which approximate their fair values because of the short-term nature of these instruments, and noncurrent liabilities of borrowings from financial institutions, which approximate their fair values because of the stated loan interest rate to the rate charged by similar financial institutions. The noncurrent portion of accounts receivables, finance lease receivables, and lease liabilities were recorded at gross adjusted for the deferred interest income using the effective interest rate method. The Company believes that the effective interest rates underlying these instruments approximate their fair values because of the Company used its incremental borrowing rate to recognize the present value of these instruments as of March 31, 2020 and 2019. Other than as listed above, the Company did not identify any assets or liabilities that are required to be presented on the balance sheet at fair value. (f) Business combinations and noncontrolling interests The Company accounts for its business combinations using the acquisition method of accounting in accordance with ASC 805 "Business Combinations." The cost of an acquisition is measured as the aggregate of the acquisition date fair value of the assets transferred to the sellers and liabilities incurred by the Company and equity instruments issued. Transaction costs directly attributable to the acquisition are expensed as incurred. Identifiable assets and liabilities acquired or assumed are measured separately at their fair values as of the acquisition date, irrespective of the extent of any noncontrolling interests. The excess of (i) the total costs of acquisition, fair value of the noncontrolling interests and acquisition date fair value of any previously held equity interest in the acquiree over (ii) the fair value of the identifiable net assets of the acquiree is recorded as goodwill. If the cost of acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognized directly in the consolidated income statements. During the measurement period, which can be up to one year from the acquisition date, the Company may record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. Upon the conclusion of the measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to the consolidated income statements. For the Company’s non-wholly owned subsidiaries, a noncontrolling interest is recognized to reflect portion of equity that is not attributable, directly or indirectly, to the Company. The cumulative results of operations attributable to noncontrolling interests are also recorded as noncontrolling interests in the Company’s consolidated balance sheets and consolidated statements of operations and comprehensive loss. Cash flows related to transactions with noncontrolling interests are presented under financing activities in the consolidated statements of cash flows. (g) Segment reporting Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker (the “CODM”), which is comprised of certain members of the Company’s management team. Historically, the Company had one single operating and reportable segment, namely the provision of an online lending services. During the year ended March 31, 2019, the Company acquired Hunan Ruixi and Jinkailong and evaluated how the CODM manages the businesses of the Company to maximize efficiency in allocating resources and assessing performance. Consequently, the Company presents two operating and reportable segments as set forth in Note 2(p). The Company has discontinued the online P2P lending services segment and has only one segment in the period after October 17, 2019. (h) Cash and cash equivalents Cash and cash equivalents primarily consist of bank deposits with original maturities of three months or less, which are unrestricted as to withdrawal and use. Cash and cash equivalents also consist of funds received from automobile purchasers as payment for automobiles, related insurances and taxes to be paid on behalf of the automobile purchasers, which funds were held at the third party platforms' fund accounts and which are unrestricted and immediately available for withdrawal and use. (i) Accounts receivable, net Accounts receivable are recorded at the invoiced amount less an allowance for any uncollectible accounts and do not bear interest, and are due on demand. Management reviews the adequacy of the allowance for doubtful accounts on an ongoing basis, using historical collection trends and aging of receivables. Management also periodically evaluates individual customer’s financial condition, credit history and the current economic conditions to make adjustments in the allowance when necessary. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. As of March 31, 2020 and 2019, allowance for doubtful accounts amounted to $379,689 and $0, respectively. (j) Inventories Inventories consist of automobiles which are held primarily for sale and for leasing purposes, and are stated at lower of cost or net realizable value, as determined using the weighted average cost method. Management compares the cost of inventories with the net realizable value and if applicable, an allowance is made for writing down the inventory to its net realizable value, if lower than cost. On an ongoing basis, inventories are reviewed for potential write-down for estimated obsolescence or unmarketable inventories which equals the difference between the costs of inventories and the estimated net realizable value based upon forecasts for future demand and market conditions. When inventories are written-down to the lower of cost or net realizable value, it is not marked up subsequently based on changes in underlying facts and circumstances. (k) Finance lease receivables, net Finance lease receivables, which result from sales-type leases, are measured at discounted present value of (i) future minimum lease payments, (ii) any residual value not subject to a bargain purchase option as a finance lease receivables on its balance sheet and (iii) accrued interest on the balance of the finance lease receivables based on the interest rate inherent in the applicable lease over the term of the lease. Management also periodically evaluates individual customer’s financial condition, credit history and the current economic conditions to make adjustments in the allowance when necessary. Finance lease receivables is charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. As of March 31, 2020 and 2019, the Company determined no allowance for doubtful accounts was necessary for finance lease receivables. As of March 31, 2020 and 2019, finance lease receivables consisted of the following: March 31, March 31, 2020 2019 Gross minimum lease payments receivable $ 1,606,230 $ 40,023 Less: Amounts representing estimated executory costs - - Minimum lease payments receivable 1,606,230 40,023 Less Allowance for uncollectible minimum lease payments receivable - - Net minimum lease payments receivable 1,606,230 40,023 Less: Unearned interest (412,975) (7,471) Financing lease receivables, net $ 1,193,255 $ 32,552 Finance lease receivables, net, current portion $ 459,110 $ 10,254 Finance lease receivables, net, noncurrent portion $ 734,145 $ 22,298 Future scheduled minimum lease payments for investments in sales-type leases as of March 31, 2020 are as follows: Minimum future payments receivable Year ending March 31, 2021 $ 607,718 Year ending March 31, 2022 570,944 Year ending March 31, 2023 341,389 Year ending March 31, 2024 86,179 Total $ 1,606,230 (l) Property and equipment, net Property and equipment primarily consists of computer equipment, which is stated at cost less accumulated depreciation less any provision required for impairment in value. Depreciation is computed using the straight-line method with no residual value based on the estimated useful life. The useful life of property and equipment is summarized as follows: Categories Useful life Leasehold improvements Shorter of the remaining lease terms or estimated useful lives Computer equipment 2 - 5 years Office equipment 3 - 5 years Automobiles 3 - 4 years The Company reviews property and equipment for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An asset is considered impaired if its carrying amount exceeds the future net undiscounted cash flows that the asset is expected to generate. If such asset is considered to be impaired, the impairment recognized is the amount by which the carrying amount of the asset, if any, exceeds its fair value determined using a discounted cash flow model. For the years ended March 31, 2020 and 2019, there was no impairment of property and equipment. Costs of repairs and maintenance are expensed as incurred and asset improvements are capitalized. The cost and related accumulated depreciation of assets disposed of or retired are removed from the accounts, and any resulting gain or loss is reflected in the consolidated income statements. (m) Intangible assets, net Purchased intangible assets are recognized and measured at fair value upon acquisition. Separately identifiable intangible assets that have determinable lives continue to be amortized over their estimated useful lives using the straight-line method as follows: Categories Useful life Platform 7 years Customer relationship 10 years Software 5-10 years Separately identifiable intangible assets to be held and used are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Determination of recoverability is based on an estimate of undiscounted future cash flows resulting from the use of the asset and its eventual disposition. Measurement of any impairment loss for identifiable intangible assets is based on the amount by which the carrying amount of the assets exceeds the fair value of the assets. For the years ended March 31, 2020 and 2019, there was a $265,525 and $0 impairment, respectively, on customer relationship from Sichuan Senmiao as a result of the Company's decision to discontinue the P2P lending business in October 2019. (n) Loss per share Basic loss per share is computed by dividing net loss attributable to stockholders by the weighted average number of outstanding shares of common stock, adjusted for outstanding shares of common stock that are subject to repurchase. For the calculation of diluted loss per share, net loss attributable to stockholders for basic earnings loss per share is adjusted by the effect of dilutive securities, including share-based awards, under the treasury stock method. Potentially dilutive securities, of which the amounts are insignificant, have been excluded from the computation of diluted net loss per share if their inclusion is anti-dilutive. (o) Derivative liabilities A contract is designated as an asset or a liability and is carried at fair value on the Company's balance sheet, with any changes in fair value recorded in the Company's results of operations. The Company then determines which options, warrants and embedded features require liability accounting and records the fair value as a derivative liability. The changes in the values of these instruments are shown in the accompanying consolidated statements of operations and comprehensive loss as "change in fair value of derivative liabilities". (p) Revenue recognition The Company adopted ASC 606, Revenue from Contracts with Customers (“ASC 606") on April 1, 2018 using the modified retrospective approach. ASC 606 establishes principles for reporting information about the nature, amount, timing and uncertainty of revenue and cash flows arising from the entity’s contracts to provide goods or services to customers. The core principle requires an entity to recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration that it expects to be entitled to receive in exchange for those goods or services recognized as performance obligations are satisfied. It also requires the Company to identify contractual performance obligations and determine whether revenue should be recognized at a point in time or over time, based on when control of goods and services transfers to a customer. To achieve that core principle, the Company applies the five steps defined under ASC 606: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company accounts for a contract with a customer when the contract is committed in writing, the rights of the parties, including payment terms, are identified, the contract has commercial substance and consideration to collect is substantially probable. The Company has assessed the impact of the guidance by reviewing its existing customer contracts and current accounting policies and practices to identify differences that will result from applying the new requirements, including the evaluation of its performance obligations, transaction price, customer payments, transfer of control and principal versus agent considerations. Based on the assessment, the Company concluded that there was no change to the timing and pattern of revenue recognition for its current revenue streams in scope of ASC 606 and therefore there was no material changes to the Company’s consolidated financial statements upon adoption of ASC 606. As of March 31, 2020, the Company had outstanding contracts for automobile transaction and related services amounting to $590,509, of which $387,345 is expected to be completed within twelve months after March 31, 2020, and $203,164 is expected to be completed after March 31, 2021. Disaggregated information of revenues by business lines are as follows: For the Years Ended March 31, 2020 2019 Automobile Transaction and Related Services (Continuing Operations) - Revenues from sales of automobiles $ 11,536,691 $ 1,815,425 - Service fees from automobile purchase services 1,726,717 407,632 - Facilitation fees from automobile transactions 197,815 142,615 - Service fees from management and guarantee services 141,527 60,011 - Financing revenues 164,391 - - Operating lease revenues from automobile rentals 1,303,639 - - Other service fees 584,795 125,424 Total revenues from Automobile Transaction and Related Services (Continuing Operations) 15,655,575 2,551,107 Online Lending Services (Discontinued Operations) - Transaction fees 73,341 331,960 - Service fees 23,833 37,996 - Website development revenue 15,266 - Total revenues from Online Lending Services (Discontinued Operations) 112,440 369,956 Total revenues $ 15,768,015 $ 2,921,063 Automobile transaction and related services Sales of automobiles – The Company generates revenue from sales of automobiles to the customers of Jinkailong, Hunan Ruixi and Mashang Chuxing. The control over the automobile is transferred to the purchaser along with the delivery of automobile. The amount of the revenue is based on the sale price agreed by Hunan Ruixi or Yicheng and the counterparties, including Jinkailong and Mashang Chuxing, who acts on behalf of its customers. The Company recognizes revenues when the automobile is delivered and control is transferred to the purchaser at a point in time. Service fees from automobile purchase services– Services fees from automobile purchase services are paid by automobile purchasers for a series of the services provided to them throughout the purchase process such as credit assessment, preparation of financing application materials, assistance with closing of financing transactions, license and plate registration, payment of taxes and fees, purchase of insurance, installment of GPS devices, ride-hailing driver qualification and other administrative procedures. The amount of these fees is based on the sales price of the automobiles and relevant services provided. The Company recognizes revenue when all the services are completed and the automobile is delivered to the purchaser at a point in time. Facilitation fees from automobile transactions – Facilitation fees from automobile purchase transactions are paid by the Company’s customers including third-party sales teams or the automobile purchasers for the facilitation of the sales and financing of automobiles. The Company attracts automobile purchasers through third-party sales teams or its own sales department. For the sales facilitated between third-party sales teams and automobile purchasers, the Company charges the fees to the third-party sales teams, which derived from the commission paid by the automobile purchasers to the third-party sales teams. Relating to sales facilitated between automobile purchasers and dealers, the Company charges the fees to the automobile purchasers. The Company recognizes revenue from facilitation fees when the titles are transferred to the purchasers at a point in time. The amount of fees is based on the type of automobile and negotiation with each sales team or automobile purchaser. The fees charged to third-party sales teams or automobile purchasers are paid before the automobile purchase transactions are consummated. These fees are non-refundable upon the delivery of automobiles. Service fees from management and guarantee services – Over 95% of the Company’s customers are drivers of Didi Chuxing Technology Co., Ltd., the largest ride-hailing service platform in China. The drivers sign affiliation agreements with the Company, pursuant to which the Company provides them with management and guarantee services during the affiliation period. Service fees for management and guarantee services are paid by such automobile purchasers on a monthly basis for the management and guarantee services provided during the affiliation period. The Company recognizes revenue over the affiliation period when performance obligations are completed. Financing revenues - Interest income from the lease arising from the Company's sales-type leases and bundled lease arrangements are recognized as financing revenues over the lease term based on the effective rate of interest in the lease. Operating lease revenues from automobile rentals -The Company generates revenue from sub-leasing automobiles from some online ride-hailing drivers or leasing its own automobiles. The Company recognizes revenue wherein the automobile is transferred to the leasee and the leasee has the ability to control the asset, is accounted for under ASC Topic 842. Rental transactions are satisfied over the rental period. Rental periods are short term in nature, generally are twelve months or less. Lease On April 1, 2019, the Company adopted ASU 2016-02, Leases (ASC Topic 842). This update, as well as additional amendments and targeted improvements issued in 2018 and early 2019, supersedes existing lease accounting guidance found under ASC 840, Leases ("ASC 840"). The accounting for lessors does not fundamentally change with this update except for changes to conform and align guidance to the lessee guidance, as well as to the revenue recognition guidance in ASU 2014-09, Revenue from Contracts with Customers (ASC Topic 606). Some of these conforming changes, such as those related to the definition of lease term and minimum lease payments, resulted in certain lease arrangements, that would have been previously accounted for as operating leases, to be classified and accounted for as sales-type leases with a corresponding up-front recognition of automobile sales revenue when the lessee obtained control over the automobile. The two primary accounting provisions the Company uses to classify transactions as sales-type or operating leases are: (i) a review of the lease term to determine if it is for the major part of the economic life of the underlying equipment (defined as greater than 75)%; and (ii) a review of the present value of the lease payments to determine if they are equal to or greater than substantially all of the fair market value of the equipment at the inception of the lease (defined as greater than 90)%. Automobile included in arrangements meeting these conditions are accounted for as sales-type leases. Interest income from the lease is recognized in financing revenues over the lease term. Automobile included in arrangements that do not meet these conditions are accounted for as operating leases and revenue is recognized over the term of the lease. The Company excludes from the measurement of its lease revenues any tax assessed by a governmental authority that is both imposed on and concurrent with a specific revenue-producing transaction and collected from a customer. The Company considers the economic life of most of the automobiles to be three to four years, since this represents the most common lease term for its automobiles and the automobiles will be used for ride-hailing services. The Company believes three to four years is representative of the period during which an automobile is expected to be economically usable, with normal service, for the purpose for which it is intended. A portion of the Company's direct sales of automobile to end customers are made through bundled lease arrangements which typically include automobile, services (automobile purchase services, facilitation services, and management and guarantee services) and financing components where the customer pays a single negotiated fixed minimum monthly payment for all elements over the contractual lease term. Revenues under these bundled lease arrangements are allocated considering the relative standalone selling prices of the lease and non-lease deliverables included in the bundled arrangement and the financing components. Lease deliverables include the automobile and financing, while the non-lease deliverables generally consist of the services and repayment of advanced fees made on behalf of its customers. The Company considers the fixed payments for purposes of allocation to the lease elements of the contract. The fixed minimum monthly payments are multiplied by the number of months in the contract term to arrive at the total fixed lease payments that the customer is obligated to make over the lease term. Amounts allocated to the automobile and financing elements are then subjected to the accounting estimates under ASC 842 to ensure the values reflect standalone selling prices. The remainder of any fixed payments are allocated to non-lease elements (automobile purchase services, facilitation fees, and management and guarantee services), for which these revenues are recognized in a manner consistent with the guidance for service fees from automobile purchase services, facilitation fees from automobile transactions, and service fees from management and guarantee services as discussed above. The Company's lease pricing interest rates, which are used in determining customer payments in a bundled lease arrangement, are developed based upon the local prevailing rates in the marketplace where its customer will be able to obtain an automobile loan under similar terms from the bank. The Company reassesses its pricing interest rates quarterly based on changes in the local prevailing rates in the marketplace. As of March 31, 2020, the Company's pricing interest rate was 6.0% per annum. Online P2P Lending Services (Discontinued Operations) Transaction fees – Prior to the Company’s P2P lending business being discontinued on October 17, 2019, transaction fees were paid by borrowers to the Company for the work the Company performed through its platform. The amount of these fees was based upon the loan amount and the maturity date of the loan. The fees charged to borrowers were paid upon (i) disbursement of the proceeds for loans which accrued interest o |
ACQUISITION OF HUNAN RUIXI AND
ACQUISITION OF HUNAN RUIXI AND ITS VIE | 12 Months Ended |
Mar. 31, 2020 | |
ACQUISITION OF HUNAN RUIXI AND ITS VIE | |
ACQUISITION OF HUNAN RUIXI AND ITS VIE | 4. ACQUISITION OF HUNAN RUIXI AND ITS VIE On November 21, 2018, the Company entered into the Investment Agreement with Hunan Ruixi and the Hunan Ruixi Shareholders. Pursuant to the Investment Agreement, among other things, the Company acquired from the Hunan Ruixi Shareholders an aggregate of 60% of the outstanding equity interest in Hunan Ruixi for no consideration. The Company closed the acquisition on November 22, 2018 and agreed to make a capital contribution of $6,000,000 to Hunan Ruixi, representing 60% of its registered capital, in accordance with the Investment Agreement. As of June 30, 2019, the Company made the full cash contributions totaling $6,000,000 to Hunan Ruixi. The Company is entitled to vote and receive profits based on its equity interest ownership in Hunan Ruixi and has a right of first refusal for any issuance of new equity of Hunan Ruixi. The acquisition had been accounted for as a business combination and the results of operations of Hunan Ruixi have been included in the Company’s consolidated financial statements from the acquisition date. The Company made estimates and judgments in determining the fair value of acquired assets and liabilities, based on an independent valuation report and management’s experiences with similar assets and liabilities. The following table summarizes the fair values for major classes of assets acquired and liabilities assumed at the date of acquisition: Fair value Net assets acquired (i) $ 63,965 Gain from acquisition of Hunan Ruixi and its subsidiary and VIE - Noncontrolling interests (ii) - Total purchase consideration $ - (i) Net assets acquired primarily include cash and cash equivalents of $213,645, other current assets of $1,813,821, property and equipment of $107,865, other current liabilities of $711,303 and borrowings from related parties and affiliates of $785,231, and borrowings from financial institutions of $554,802. (ii) Fair value of the noncontrolling interests is estimated with reference to the purchase price per share as of the acquisition date. |
DISCONTIUED OPERATIONS
DISCONTIUED OPERATIONS | 12 Months Ended |
Mar. 31, 2020 | |
DISCONTIUED OPERATIONS | |
DISCONTIUED OPERATIONS | 5. DISCONTIUED OPERATIONS On October 17, 2019, the Board approved the Plan under which the Company has discontinued and is winding down its online P2P lending services business. The Company determined that the continued operation of its online P2P lending services business was not viable in light of the recently tightened regulations on online peer-to-peer lending in China generally and the unofficial request from local regulator to reduce the Company’s online peer-to-peer lending transaction volume on a monthly basis. The Company also determined that the discontinuation of its online P2P lending services business would allow the Company to focus its resources on its automobile financing facilitation and transaction business. In connection with the Plan, the Company ceased facilitation of loan transactions on its online lending platform and assumed all the outstanding loans from investors on the platform. The decision and action taken by the Company of discontinuing the online lending services business represented a major shift that will have a major effect on the Company’s operations and financial results, which triggers discontinued operations accounting in accordance with ASC 205-20-45. The fair value of discontinued operations, determined as of October 17, 2019, includes estimated consideration expected to be received, less costs to sell. After consideration of the determination of fair value of the discontinued operations including the assumption of all the outstanding loans from investors on the platform, $143,668 of accounts receivable, $3,760,599 of other receivables, and $143,943 of prepayments for impaired intangible assets were indicated as of Board approval date of winding down its online P2P lending services business on October 17, 2019 and the Company recognized $4,048,210 provision for doubtful accounts for the year ended March 31, 2020, in related to the Company’s online lending services business. The following table sets forth the reconciliation of the carrying amounts of major classes of assets and liabilities from discontinued operations in the consolidated balance sheets as of March 31, 2020. Carrying amounts of major classes of assets included as part of discontinued operations: March 31, March 31, 2020 2019 Current Assets Cash and cash equivalents $ 10,139 $ 1,052,530 Accounts receivable, net — 126,272 Prepayments, other receivables and other assets, net 816,441 6,214 Total Current Assets 826,580 1,185,016 Property and equipment, net 11,206 25,205 Other Assets Intangible assets, net — 294,464 Prepayment for intangible assets — 190,706 Total Other Assets — 485,170 Total Assets $ 837,786 $ 1,695,391 Carrying amounts of major classes of liabilities included as part of discontinued operations: March 31, March 31, 2020 2019 Current Liabilities Advance from customers $ — $ 7,220 Accrued expenses and other liabilities 4,204,012 538,512 Due to stockholders 182,095 1,080,047 Due to related parties and affiliates 76,286 — Lease liabilities 53,899 — Total Current Liabilities 4,516,292 1,625,779 Total liabilities $ 4,516,292 $ 1,625,779 The following table sets forth the reconciliation of the amounts of major classes of income and losses from discontinued operations in the consolidated statements of operations and comprehensive loss for year ended March 31, 2020. For the Years Ended March 31, 2020 2019 Revenues $ 112,440 $ 369,956 Operating expenses Selling, general and administrative expenses (1,365,733) (2,242,905) Bad debt expense (4,048,210) — Amortization of intangible assets (32,401) (308,043) Impairments of intangible assets and goodwill (265,525) (1,225,073) Total operating expenses (5,711,869) (3,776,021) Loss from operations (5,599,429) (3,406,065) Other income, net 12,402 19,315 Loss before income taxes (5,587,027) (3,386,750) Income tax expenses — — Net loss attributable to stockholders $ (5,587,027) $ (3,386,750) |
ACCOUNTS RECEIVABLE, NET
ACCOUNTS RECEIVABLE, NET | 12 Months Ended |
Mar. 31, 2020 | |
ACCOUNTS RECEIVABLE, NET | |
ACCOUNTS RECEIVABLE, NET | 6. ACCOUNTS RECEIVABLE, NET Accounts receivable include a portion of bundled lease arrangements on fixed minimum monthly payments to be paid by the automobile purchasers arising from automobile sales and services fees, net of unearned interest income, discounted using the Company’s lease pricing interest rates. As of March 31, 2020 and 2019, accounts receivable were comprised of the following: March 31, March 31, 2020 2019 Receivables of transaction fees due from borrowers $ - $ 126,272 Receivables of automobile sales due from automobile purchasers 1,172,765 - Receivables of services fees due from automobile purchasers 854,730 199,909 Less: Unearned interest (105,083) - Less: Allowance for doubtful accounts (379,689) - Accounts receivable, net $ 1,542,723 $ 326,181 Accounts receivable, net, - discontinued operations - (126,272) Accounts receivable, net, - continuing operations $ 1,542,723 $ 199,909 Accounts receivable, net, current portion $ 660,645 $ 199,909 Accounts receivable, net, noncurrent portion $ 882,078 $ - Movement of allowance for doubtful accounts is as follows: March 31, March 31, 2020 2019 Beginning balance $ — $ — Addition 1,797,816 — Write off (1,410,736) Translation adjustment (7,391) — Ending balance $ 379,689 $ — |
INVENTORIES
INVENTORIES | 12 Months Ended |
Mar. 31, 2020 | |
INVENTORIES | |
INVENTORIES | 7. INVENTORIES March 31, March 31, 2020 2019 Automobiles (i) $ 1,000,675 $ 1,508,244 (i) As of March 31, 2020, the Company owned 70 automobiles with a total value of $850,533 for sale, and 11 automobiles with a total value of $150,142 for either leasing or sale. As of March 31, 2020 and 2019, management compared the cost of automobiles with their net realizable value and determined no inventory write-down was necessary for these automobiles. |
PREPAYMENTS, OTHER RECEIVABLES
PREPAYMENTS, OTHER RECEIVABLES AND OTHER ASSETS | 12 Months Ended |
Mar. 31, 2020 | |
PREPAYMENTS, OTHER RECEIVABLES AND OTHER ASSETS | |
PREPAYMENTS, OTHER RECEIVABLES AND OTHER ASSETS | 8 . PREPAYMENTS, OTHER RECEIVABLES AND OTHER ASSETS As of March 31, 2020 and 2019, the prepayments, receivables and other assets were comprised of the following: March 31, March 31, 2020 2019 Receivables from borrowers of online lending platform, net (i) $ 811,504 $ - Due from automobile purchasers, net (ii) 1,385,352 2,564,834 Prepayments for automobiles (iii) 365,932 394,821 Deposits 489,638 294,986 Value added tax (“VAT”) recoverable 146,964 228,196 Deferred issuance costs - 149,696 Prepaid expenses 331,319 112,147 Employee advances 11,937 - Others 72,575 48,788 Total prepayments, receivables and other assets 3,615,221 3,793,468 Total prepayments, receivables and other assets - discontinued operations (816,441) (6,214) Total prepayments, receivables and other assets - continuing operations $ 2,798,780 $ 3,787,254 (i) Receivables from borrowers of online lending platform, net The balance of receivables from borrowers of online lending platform represented the outstanding loans the Company assumed from investors on the platform, which will be collected from related borrowers. As of March 31, 2020, the Company recorded allowance of $3,688,800 against doubtful receivables. (ii) Due from automobile purchasers, net The balance due from automobile purchasers represented the payment of automobiles and related insurances and taxes made on behalf of the automobile purchasers. The balance is expected to be collected from the automobile purchasers in installments. As of March 31, 2020 and 2019, the Company recorded allowance of $347,954 and $2,995, respectively, against doubtful receivables. During the year ended March 31, 2020, the Company wrote off balance due from automobile purchasers of $1,227,894. (iii) Prepayments for automobiles The balance represented amounts advanced to dealers for automobiles and to other third parties for automobiles related taxes and insurances. |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 12 Months Ended |
Mar. 31, 2020 | |
PROPERTY AND EQUIPMENT, NET | |
PROPERTY AND EQUIPMENT, NET | 9. PROPERTY AND EQUIPMENT, NET Property and equipment consist of the following: March 31, March 31, 2020 2019 Leasehold improvements $ 177,659 $ — Electronic devices 40,720 28,305 Office equipment, fixtures and furniture 79,271 48,157 Vehicles 320,949 81,523 Subtotal 618,599 157,985 Less: accumulated depreciation and amortization (138,192) (32,100) Total property and equipment, net 480,407 125,885 Total property and equipment, net - discontinued operations (11,206) (25,205) Total property and equipment, net - continuing operations $ 469,201 $ 100,680 Depreciation and amortization expense from continuing operations for the years ended March 31, 2020 and 2019 amounted to $103,009 and $12,247, respectively. Depreciation and amortization expense from discontinued operations for the years ended March 31, 2020 and 2019 amounted to $10,846 and $10,604, respectively. |
INTANGIBLE ASSETS, NET
INTANGIBLE ASSETS, NET | 12 Months Ended |
Mar. 31, 2020 | |
INTANGIBLE ASSETS, NET | |
INTANGIBLE ASSETS, NET | 10. INTANGIBLE ASSETS, NET Intangible assets consisted of the following: March 31, March 31, 2020 2019 Customer relationship $ - $ 392,618 Platform 1,100,549 1,161,267 Software 815,315 27,205 Subtotal 1,915,864 1,581,090 Less: Accumulated amortization (1,138,243) (1,284,999) Total intangible assets, net 777,621 296,091 Total intangible assets, net - discontinued operations - (294,464) Total intangible assets, net - continuing operations $ 777,621 $ 1,627 Amortization expense from continuing operations totaled $283 and $0 for the years ended March 31, 2020 and 2019, respectively. Amortization expense from discontinued operations totaled $32,401 and $308,043 for the years ended March 31, 2020 and 2019, respectively. The following table sets forth the Company’s amortization expense for the next five years ending: Amortization expenses Twelve months ending March 31, 2021 $ 158,243 Twelve months ending March 31, 2022 158,243 Twelve months ending March 31, 2023 158,243 Twelve months ending March 31, 2024 152,863 Thereafter 150,029 Total $ 777,621 |
PREPAYMENTS FOR INTANGIBLE ASSE
PREPAYMENTS FOR INTANGIBLE ASSETS | 12 Months Ended |
Mar. 31, 2020 | |
PREPAYMENTS FOR INTANGIBLE ASSETS | |
PREPAYMENTS FOR INTANGIBLE ASSETS | 11. PREPAYMENTS FOR INTANGIBLE ASSETS As of March 31 2019, the balance of prepayments for intangible assets of $280,000 represented the advance payments to a third party for the development of software to be used in the Company’s automobile transaction and related services. As of March 31, 2020, the prepayments for the software with amount of $750,000 has been transferred to intangible assets and will be amortized over the estimated useful life of 10 years. As of March 31, 2019, the balance of prepayments for intangible assets of $190,706 represented the advance payments for the development of software to be used in the Company’s online P2P lending services business. On October 17, 2019, the Board approved the Plan under which the Company discontinued and is winding down its online P2P lending services business. As a result, the Company re-evaluated its prepayments for intangible assets to be used in the Company’s online P2P lending platform and determined that it would no longer be using such software. As a result, the Company wrote off all those prepayments of $143,943 for intangible assets for the year ended March 31, 2020. |
BORROWINGS FROM FINANCIAL INSTI
BORROWINGS FROM FINANCIAL INSTITUTIONS, CURRENT AND NONCURRENT | 12 Months Ended |
Mar. 31, 2020 | |
BORROWINGS FROM FINANCIAL INSTITUTIONS CURRENT AND NONCURRENT | |
BORROWINGS FROM FINANCIAL INSTITUTIONS, CURRENT AND NONCURRENT | 12. BORROWINGS FROM FINANCIAL INSTITUTIONS, CURRENT AND NONCURRENT Borrowings from Financial institutions The borrowings from certain financial institutions represented the difference between the actual proceeds disbursed by the financial institutions to Jinkailong and the total principal to be responsible for and repaid by the automobile purchasers. Such borrowings totaled $290,974 and $396,946 bearing interest rates ranging between 6.2% and 8.1% per annum as of March 31, 2020 and 2019, respectively, of which $64,221 and $177,789, respectively, is to be repaid over a period of 13 to 24 months. The interest expense for the years ended March 31, 2020 and 2019 was $49,422 and $12,799, respectively. |
BORROWINGS FROM THIRD PARTIES
BORROWINGS FROM THIRD PARTIES | 12 Months Ended |
Mar. 31, 2020 | |
BORROWINGS FROM THIRD PARTIES | |
BORROWINGS FROM THIRD PARTIES | 13. BORROWINGS FROM THIRD PARTIES March 31, March 31, 2020 2019 Borrowings from third parties $ - $ 476,765 The borrowings from third parties were fully repaid in July 2019. The interest expense for the years ended March 31, 2020 and 2019 was $17,258 and $7,590, respectively. |
ACCRUED EXPENSES AND OTHER LIAB
ACCRUED EXPENSES AND OTHER LIABILITIES | 12 Months Ended |
Mar. 31, 2020 | |
ACCRUED EXPENSES AND OTHER LIABILITIES | |
ACCRUED EXPENSES AND OTHER LIABILITIES | 14. ACCRUED EXPENSES AND OTHER LIABILITIES March 31, March 31, 2020 2019 Payables to investors of online lending platform (i) $ 3,668,957 $ - Accrued payroll and welfare 890,912 614,765 Other payable (ii) 83,810 247,335 Loan repayments received on behalf of financial institutions (iii) 374,535 169,657 Payables for expenditures on automobile transaction and related services 373,026 157,382 Accrued expenses 104,264 198,456 Deposits 543,843 82,232 Other taxes payable 173,056 30,976 Total accrued expenses and other liabilities 6,212,403 1,500,803 Total accrued expenses and other liabilities - discontinued operations (4,204,012) (538,512) Total accrued expenses and other liabilities - continuing operations $ 2,008,391 $ 962,291 (i) (ii) The balance of other payable represented amount due to suppliers and vendors for operation purposes. (iii) The balance of loan repayments received on behalf of financial institutions represented the loan repayments made by the automobile purchasers to financial institutions through the Company, which has not been paid to the financial institutions. |
EMPLOYEE BENEFIT PLAN
EMPLOYEE BENEFIT PLAN | 12 Months Ended |
Mar. 31, 2020 | |
EMPLOYEE BENEFIT PLAN | |
EMPLOYEE BENEFIT PLAN | 15. EMPLOYEE BENEFIT PLAN The Company has made employee benefit plan in accordance with relevant PRC regulations, including retirement insurance, unemployment insurance, medical insurance, housing fund, work injury insurance and maternity insurance. The contributions made by the Company were $204,245 and $22,258 for the years ended March 31, 2020 and 2019, respectively, for continuing operations of the Company. The contributions made by the Company were $158,523 and $84,043 for the years ended March 31, 2020 and 2019, respectively, for the Company’s discontinued operations. As of March 31, 2020 and 2019, the Company did not make adequate employee benefit contributions in the amount of $170,856 and $65,826, respectively, for continuing operations of the Company. As of March 31, 2020 and 2019, the Company did not make adequate employee benefit contributions in the amount of $454,151 and $337,820, respectively, for discontinued operations of the Company. The Company accrued the amount in accrued payroll and welfare. |
EQUITY
EQUITY | 12 Months Ended |
Mar. 31, 2020 | |
EQUITY | |
EQUITY | 16. EQUITY Warrants IPO Warrants The registration statement relating to the Company’s IPO also included the underwriters’ common stock purchase warrants to purchase 337,940 shares of common stock (“Underwriter’s Warrants”). Each five-year warrant entitles warrant holder to purchase one share of the Company’s common stock at the price of $4.80 per share and is not exercisable for a period of 180 days from March 16, 2018. On March 15, 2019, the underwriters elected to exercise 300,000 Purchase Warrants on a cashless basis in exchange for common stock. On April 5, 2019, the Company issued a total of 65,855 shares of common stock to the underwriters as a result of the cashless exercise of 300,000 Underwriter’s Warrants. As the date of March 31, 2020, there were 37,940 Underwriter’s Warrants outstanding. Registered Direct Offering Warrants The Company adopted the provisions of ASC 815 on determining what types of instruments or embedded features in an instrument held by a reporting entity can be considered indexed to its own stock for the purpose of evaluating the first criteria of the scope exception in ASC 815. Warrants issued in connection with the direct equity offering with exercise prices denominated in US dollars are no longer considered indexed to the Company's stock, as their exercise price is not in the Company's functional currency (RMB), and therefore no longer qualify for the scope exception and must be accounted for as a derivative. These warrants are classified as liabilities under the caption "Derivative liabilities" in the consolidated statements of balance sheets and recorded at estimated fair value at each reporting date, computed using the Black-Scholes valuation model. Changes in the liability from period to period are recorded in the consolidated statements of operations and comprehensive loss under the caption "Change in fair value of derivative liabilities." The Company allocated the proceeds received between the common stock and warrants first to warrants based on the fair value on the date the proceeds were received with the balance to common stock. The value of the warrants was determined using the Black-Scholes valuation model using the following assumptions: volatility 86%; risk free interest rate 1.77%; dividend yield of 0% and expected term of 4 years of the Investor Series A Warrants, 1 year of the Series B Warrants, and 4 years of the Placement Warrants. The volatility of the Company's common stock was estimated by management based on the historical volatility of its common stock, the risk free interest rate was based on Treasury Constant Maturity Rates published by the U.S. Federal Reserve for periods applicable to the expected life of the warrants. The expected dividend yield was based on the Company's current and expected dividend policy and the expected term is equal to the contractual life of the warrants. The value of the warrants was based on the Company's common stock closing price of $2.80 on the date the warrants were issued. Net proceeds were allocated as the follows: Warrants $ 3,150,006 Common stock 1,992,118 Total net proceeds $ 5,142,124 Subsequent to the initial recording, the change in the fair value of the warrants, determined under the Black-Scholes valuation model, at each reporting date will result in either an increase or decrease the amount recorded as liability, based on the fluctuations with the Company's stock price with a corresponding adjustment to other income (or expense). During the year ended March 31, 2020, the change of fair value was a gain of $1,796,724, recognized in the accompanying consolidated statements of operations and comprehensive loss based on the decrease in fair value of the liabilities since granted. The fair value of derivative instrument of $1,010,752 was allocated to additional paid-in-capital upon exercise of warrants as of the exercise date. At March 31, 2020, the fair value of the derivative instrument totaled $342,530. The Company has outstanding warrants as following: Weighted Average Average Remaining Warrants Warrants Exercise Contractual Outstanding Exercisable Price Life Balance, March 31, 2018 337,940 337,940 $ 4.80 4.96 Granted — — — — Forfeited — — — — Exercised (300,000) (300,000) $ 4.80 — Balance, March 31, 2019 37,940 37,940 $ 4.80 3.96 Granted 2,594,850 2,594,850 $ 3.70 4.00 Forfeited — — — — Exercised (1,113,188) (1,113,188) — — Balance, March 31, 2020 1,519,602 1,519,602 $ 1.76 3.21 Restricted Stock Units On July 31, 2018, the Board approved the issuance of 5,000 restricted stock units (“RSUs”) to each of the five directors as stock compensation for their services for the Company’s fiscal year ending March 31, 2019. Total RSUs granted to the five directors were 25,000 for an aggregate fair value of $117,750. Pursuant to the Restricted Stock Unit Award Agreements (“Award Agreements”) on August 3, 2018, the RSUs vest in four equal quarterly installments on August 3, 2018, April 1, 2019, July 1, 2019 and October 1, 2019 or in full upon the occurrence of a change in control of the Company, subject to the terms and conditions set forth in the Award Agreements, provided that the director remains in service as a director through the applicable vesting date. The RSUs will be settled by the Company’s issuance of shares of common stock in certificated or uncertificated form upon the earlier of (i) a change in control and (ii) the director’s cessation as a director of the Company due to a “separation of service” within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended, or the director’s death or disability. As of March 31, 2019, the first installment of 6,250 RSUs vested. The fair value of the vested RSUs is calculated at the grant date market price of the Company’s common stock multiplying by the number of vested shares. On December 11, 2019, the Board approved the issuance of 30,303 RSUs to each of the Company's five directors as stock compensation for their services for the Company's fiscal year ending March 31, 2020. As of March 31, 2020, the Company issued a total of 169,015 RSUs and accounted for as expenses and charged to common stock. A summary of RSU activity for the year ended March 31, 2020 and 2019 is as follows: Weighted-Average Grant Number of Date Fair Shares Value Balance of RSUs outstanding at March 31, 2018 - $ - Grants of RSUs 25,000 $ 4.42 Vested RSUs (6,250) $ 4.42 Forfeited RSUs (7,500) $ 4.42 Balance of unvested RSUs at March 31, 2019 11,250 $ 4.42 Grants of RSUs 151,515 0.66 Vested RSUs (162,765) $ 0.92 Forfeited RSUs - - Balance of unvested RSUs at March 31, 2020 - $ - Total compensation expense for the years ended March 31, 2020 and 2019 was $133,150 and $44,200,respectively. Two directors ceased to serve on the board since November 8, 2018, and as a result 7,500 RSUs were forfeited during the year ended March 31, 2019. Equity Incentive Plan At the 2018 Annual Meeting of Stockholders of the Company held on November 8, 2018, the Company’s stockholders approved the Company’s 2018 Equity Incentive Plan for employees, officers, directors and consultants of the Company and its affiliates. A committee consisting of at least two independent directors appointed by the Board or in the absence of such a committee, the board of directors, will be responsible for the general administration of the Equity Incentive Plan. All awards granted under the Equity Incentive Plan will be governed by separate award agreements between the Company and the participants. As of March 31, 2020, no awards have been granted under the plan. Registered Direct Offering On April 15, 2019, the SEC declared effective the Company’s Registration Statement on Form S‑3, pursuant to which, along with the accompanying prospectus, the Company registered up to $80,000,000 in aggregate principal amount of its common stock, preferred stock, debt securities, warrants, rights and/or units. On June 21, 2019, the Company closed a registered direct offering of an aggregate of 1,781,361 shares of its common stock, and in connection therewith, issued to the investors (i) for no additional consideration, Series A warrants to purchase up to an aggregate of 1,336,021 shares of common stock and (iii) for nominal additional consideration, Series B warrants to purchase up to a maximum aggregate of 1,116,320 shares of common stock. The Company sold the shares of common stock at a price of $3.38 per share (the “Share Purchase Price”). The Company received gross proceeds from the offering, before deducting estimated offering expenses payable by the Company, of approximately $6,000,000. The Series A warrants are exercisable immediately upon issuance at an exercise price of $3.72 per share and will expire on the fourth (4th) anniversary of the original issue date. In the event that on December 20, 2019, the exercise price is greater than the Six Month Adjustment Price as defined below, on the trading day immediately following December 20, 2019 (the “Six Month Measuring Date”), the exercise price shall automatically adjust to the Six Month Adjustment Price (as adjusted for stock splits, stock dividends, stock combinations, recapitalizations and similar events). Six Month Adjustment Price means the greater of (x) $1.50 (as adjusted for any stock dividend, stock split, stock combination, reclassification or similar transaction) and (y) 100% of the quotient of (I) the sum of the five lowest VWAPs of the common stock during the ten consecutive trading day period ending and including the Six Month Measuring Date, divided by (II) five. All such determinations to be appropriately adjusted for any stock dividend, stock split, stock combination, reclassification or similar transaction during such period. The exercise price of the Series A warrant was adjusted from $3.72 to $1.50 per share on December 20, 2019. The Company used the adjusted exercise price to value its derivative liability on its December 31, 2019 financial statements and reporting periods onwards with changes in fair value of warrant liabilities from period to period are recorded in the consolidated statements of operations and comprehensive loss under the caption “Change in fair value of derivative liabilities”. The Series B warrants are pre-funded warrants and were issued as a true-up with respect to the shares of common stock. The maximum aggregate number of shares of common stock issuable upon exercise of the Series B warrants is 1,116,320. Initially, the Series B warrants shall not be exercisable for any shares of common stock. In the event that on the fiftieth (50th) day after the closing date (the “Adjustment Measuring Time”), the closing price of the common stock is less than the Share Purchase Price, then the number of shares of common stock issuable upon exercise of the Series B warrants shall be adjusted (upward or downward, as applicable) to the greater of (i) zero (0) and (ii) such aggregate number of shares of common stock equal to fifty percent (50%) of the difference of (A) the quotient of (x) the Share Purchase Price divided by (y) the Market Price (as defined in Purchase Agreement) as of the Adjustment Measuring Time, less (B) the aggregate number of shares of common stock issued to the investors at the closing (as adjusted for share splits, share dividends, share combinations, recapitalizations and similar events). The exercise price of the Series B warrant was adjusted from $3.72 to $0.0001 per share on August 12, 2019. The Company used the adjusted exercise price to value its derivative liability on its September, 2019 financial statements and reporting period onwards with changes in fair value of warrant liabilities from period to period are recorded in the consolidated statements of operations and comprehensive loss under the caption "Change in fair value of derivative liabilities. During the year ended March 31, 2020, the Company issued an aggregate of 1,113,187 shares of common stock to certain investors in the June 2019 offering upon exercise of the pre-funded Series B warrants for a total consideration of $111. The fair value of exercised Series B warrants of $1,010,752 was allocated to additional paid-in-capital upon exercise of warrants as of the exercise date. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Mar. 31, 2020 | |
INCOME TAXES | |
INCOME TAXES | 17. INCOME TAXES The United States of America The Company is incorporated in the State of Nevada in the U.S., and is subject to U.S. federal corporate income taxes with tax rate of 21%. The State of Nevada does not impose any state corporate income tax. On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the “Tax Act”). The Tax Act imposes a one-time transition tax on deemed repatriation of historical earnings of foreign subsidiaries, and future foreign earnings are subject to U.S. taxation. The Tax Act also stablished the Global Intangible Low-Taxed Income (GILTI), a new inclusion rule affecting non-routine income earned by foreign subsidiaries. For the year ended March 31, 2020 and March 31, 2019, the Company’s foreign subsidiaries in China cumulatively were operating at loss which resulted in no GILTI tax. The Company’s net operating loss for the year ended March 31, 2020 amounted to approximately $1.2 million. As of March 31, 2020, the Company’s net operating loss carryforward for U.S. income taxes was approximately $2.5 million. The net operating loss carryforward will not expire and is available to reduce future years’ taxable income, but limited to 80% of income until utilized. Management believes that the utilization of the benefit from this loss appears uncertain due to the Company’s operating history. Accordingly, the Company has recorded a 100% valuation allowance on the deferred tax asset to reduce the deferred tax assets to zero on the consolidated balance sheets. As of March 31, 2020 and 2019, valuation allowances for deferred tax assets were approximately $0.53 million and $0.27 million, respectively. Management reviews the valuation allowance periodically and makes changes accordingly. PRC Senmiao Consulting, Sichuan Senmiao, Hunan Ruixi, Ruixi Leasing, Jinkailong, and Yicheng are subject to PRC Enterprise Income Tax (“EIT”) on the taxable income in accordance with the relevant PRC income tax laws. The EIT rate for companies operating in the PRC is 25%. Income taxes in the PRC are consist of: For the Years Ended March 31, 2020 2019 Current income tax expenses $ 59,451 $ 21,905 Deferred income tax benefits (26,267) - Total income tax expenses $ 33,184 $ 21,905 Below is a reconciliation of the statutory tax rate to the effective tax rate: For the Years Ended March 31, 2020 2019 U.S. statutory tax rate 21.0 % 21.0 % Differential of PRC statutory tax rate 4.0 % 4.0 % Permanent difference of write-off of receivables from guarantee of loans (15.5) % - % Permanent difference of US (income) expenses not (taxable) deductible in PRC 3.4 % (24.1) % Valuation allowance on deferred income tax asset (13.1) % (2.4) % Others (0.6) % (0.4) % Effective tax rate (0.8) % (1.9) % As of March 31, 2020 and 2019, the Company’s PRC entities from continuing operations had net operating loss carryforwards of approximately $1.7 million and $153,000, respectively, which will expire starting from 2023 and ending in 2024. In addition, allowance for doubtful accounts must be approved by the Chinese tax authority prior to being deducted as an expense item on the tax return. Jinkailong’s bad debt allowance are incurred in Company’s PRC subsidiaries which were operating at losses, the Company believes it is more likely than not that its PRC operations will be unable to fully utilize its deferred tax assets related to the net operating loss carryforwards in the PRC. As a result, the Company provided 100% allowance on all deferred tax assets on allowance for doubtful account of $178,381, and nil related to its operations in the PRC at March 31, 2020 and 2019, respectively. At March 31, 2019, full valuation allowance is provided against the deferred tax assets based upon management’s assessment as to their realization. During the year ended March 31, 2020, the Company utilized deferred tax assets of approximately $27,000 related to the Company’s net operating loss carryforwards. The tax effects of temporary differences from continuing operations that give rise to the Company’s deferred tax assets are as follows: March 31, March 31, 2020 2019 Net operating loss carryforwards in the PRC $ 414,996 $ 30,693 Net operating loss carryforwards in the U.S. 527,365 272,258 Allowance for doubtful account 178,381 - Less: valuation allowance (1,120,742) (302,951) $ - $ - As of March 31, 2020 and March 31, 2019, the Company’s PRC entities associated with the discontinued P2P lending operations had net operating loss carryforwards of approximately $8.8 million and $3.4 million, respectively, which will expire in 2023 to 2024. The Company reviews deferred tax assets for a valuation allowance based upon whether it is more likely than not that the deferred tax asset will be fully realized. At March 31, 2020 and 2019, full valuation allowance is provided against the deferred tax assets based upon management’s assessment as to their realization. The tax effects of temporary differences from discontinued operations that give rise to the Company’s deferred tax assets are as follows: March 31, 2020 March 31, 2019 Net operating loss carryforwards in the PRC $ 2,206,673 $ 855,483 Less: valuation allowance (2,206,673) (855,483) $ — $ — |
RELATED PARTY TRANSACTIONS AND
RELATED PARTY TRANSACTIONS AND BALANCES | 12 Months Ended |
Mar. 31, 2020 | |
RELATED PARTY TRANSACTIONS AND BALANCES | |
RELATED PARTY TRANSACTIONS AND BALANCES | 18. RELATED PARTY TRANSACTIONS AND BALANCES 1. Related Party Balances 1) Due from related parties As of March 31, 2020, balances due from related parties were $12,341 and represented operation costs of four related parties paid by the Company on their behalf, amounts received by the Company on behalf of a related party for refund of insurance claims, and amounts collected by a related party on behalf of the Company from the automobile purchasers, including certain installment payments and facilitation fees. In addition, another $14,120 represents advances to the non-controlling shareholders of Hunan Ruixi for operational purposes. The balances due from related parties were all non-interest bearing and due on demand. 2) Due to stockholders This is comprised of amounts payable to two stockholders and are unsecured, interest free and due on demand. March 31, March 31, 2020 2019 Jun Wang $ 73,384 $ 107,233 Xiang Hu 108,711 972,814 Total due to stockholders $ 182,095 $ 1,080,047 Total due to stockholders – discontinued operations (182,095) (1,080,047) Total due to stockholders – continuing operations $ — $ — 3) Due to related parties and affiliates March 31, March 31, 2020 2019 Loan payable to related parties (i) $ 202,487 $ 95,781 Other payables due to related parties (ii) - 297,978 Others (iii) 26,478 22,172 Total due to related parties and affiliates 228,965 415,931 Total due to related parties and affiliates – discontinued operations (76,286) - Total due to related parties and affiliates – continuing operations $ 152,679 $ 415,931 (i) As of March 31, 2020 and 2019, the balances represented borrowings from three related parties, which is unsecured, interest free and due in the fiscal year of 2021. The balance as of March 31, 2019 bore an interest rate of 10% per annum and is due in the fiscal year of 2020. (ii) As of March 31, 2019, the balance represented borrowings from two related parties, who obtained borrowings from the online P2P lending platform of Sichuan Senmiao and then loaned the money to Jinkailong. The balance bore an interest rate of 8.22% per annum and was fully repaid in April 2019. (iii) Interest expense for the years ended March 31, 2020 and 2019 were $29,944 and $3,246, respectively. 2. Related Party Transactions In December 2017, the Company entered into loan agreements with two stockholders, who agreed to grant lines of credit of approximating $955,000 and $159,000, respectively, to the Company for five years. The lines of credit are non-interest bearing, effective from January 2017. As of March 31, 2020, the outstanding balances in the discontinued operations were $108,711 and $73,384, respectively. The Company entered into two office lease agreements which were set to expire on January 1, 2020. On April 1, 2018, the two office leases were modified with the leasing term from April 1, 2018 to March 31, 2021. As of March 31, 2020, operating lease right-of-use assets of these leases in the continuing operations amounted $105,432. As of March 31, 2020, current leases liabilities of these leases in the continuing operations amounted $78,482. As of March 31, 2020, current leases liabilities of these leases in the discontinued operations amounted $53,899. For the years ended March 31, 2020 and 2019, the Company incurred $109,896 and $113,742, respectively, to this related party in rental expenses. In November 2018, Hunan Ruixi entered into an office lease agreement with Hunan Dingchentai Investment Co., Ltd. ("Dingchentai"), a Company where one of our independent director serves as legal representative and general manager. The term of the lease agreement was from November 1, 2018 to October 31, 2023 and the rent was approximately $44,250 per year, payable on a quarterly basis. The original lease agreement with Dingchentai was terminated on July 1, 2019. The Company entered into another lease with Dingchentai on substantially similar terms on September 27, 2019. As of March 31, 2020, operating lease right-of-use assets of this lease in the continuing operations amounted $130,873. As of March 31, 2020, current leases liabilities and non-current leases liabilities of this lease in the continuing operations amounted $73,173 and $88,349, respectively. For the years ended March 31, 2020 and 2019, the Company incurred expense of $41,661 and $13,597 in rent, respectively, to Dingchentai. In June 2019 and January 2020, the Company entered into two automobile maintenance services contracts with Sichuan Qihuaxin Automobile Services Co., Ltd and Sichuan Yousen Automobile Maintenance Service Co., Ltd, the companies which are controlled by one of the noncontrolling shareholder of Sichuan Jinkailong. During the year ended March 31, 2020, the Company paid automobile maintenance fees of $36,088 and $21,759 to those companies, respectively. Before the acquisition of Hunan Ruixi, five related parties of Jinkailong borrowed funds of $747,647 through the online P2P lending platform of Sichuan Senmiao and then loaned the money to Jinkailong. As of March 31, 2019, the outstanding balance was $297,978. During the year ended March 31, 2020, Jinkailong repaid all of the loans. Those loans bore interest rates ranging from 7.68% to 8.22% per annum and the interest expense for the years ended March 31, 2020 and 2019 was $12,184 and $0, respectively. |
LEASE
LEASE | 12 Months Ended |
Mar. 31, 2020 | |
LEASE | |
LEASE | 19. LEASE Effective April 1, 2019, the Company adopted ASU 2016-02, “Leases” (Topic 842), and elected the package of practical expedients that does not require the Company to reassess: (1) whether any expired or existing contracts are, or contain, leases, (2) lease classification for any expired or existing leases and (3) initial direct costs for any expired or existing leases. The impact of the adoption of the ASC 842, as of April 1, 2019, the Company recognized $246,227 ROU assets and $247,325 lease liabilities, primarily related to leases of facilities. The ROU and lease liabilities are determined based on the present value of the future minimum rental payments of the lease as of the adoption date, using an effective interest rate of 6.0%, which is determined using an incremental borrowing rate with similar term in the PRC. The average remaining operating and finance lease term of its existing leases is 2.1 and 2.3 years, respectively. The adoption of this standard resulted in the recording of operating lease assets and operating lease liabilities as of April 1, 2019, with no related impact on the Company's consolidated statement of changes in stockholders' equity or consolidated statements of operations and comprehensive loss. Lessor The Company's operating leases for automobile rentals have rental periods that are typically short term, generally is twelve months or less. Revenue recognition section of Note 3 (p), the Company discloses that revenue earned from automobile rentals, wherein an identified asset is transferred to the customer and the customer has the ability to control that asset, is accounted for under Topic 842 upon adoption for the year ended March 31, 2020. The Company did not have any automobile rentals operations prior to April 1, 2019, which the Company would have accounted for such revenue under Topic 606 for the year ended March 31, 2019. Lessee As of March 31, 2020, the Company has engaged in offices and showroom leases which were classified as operating leases. In addition, the Company had automobiles leases which were classified as finance lease. The Company occupies various offices under operating lease agreements with a term shorter than twelve months which it elected not to recognize lease assets and lease liabilities under ASC 842. Instead, the Company recognized the lease payments in profit or loss on a straight-line basis over the lease term and variable lease payments in the period in which the obligation for those payments is incurred. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. The Company recognized lease expense on a straight-line basis over the lease term for operating lease. Meanwhile, the Company recognized the finance leases ROU assets and interest on an amortized cost basis. The amortization of finance ROU assets is recognized on an accretion basis as amortization expense, while the lease liability is increased to reflect interest on the liability and decreased to reflect the lease payments made during the period. Interest expense on the lease liability is determined each period during the lease term as the amount that results in a constant periodic interest rate of the automobile loans on the remaining balance of the liability. Operating and finance lease expenses are consist of following: For the Years Ended Classification March 31, 2020 March 31, 2019 Operating lease cost Lease expenses Selling, general and administrative $ 378,499 $ 195,686 Finance lease cost Amortization of leased asset Cost of revenue 941,796 — Amortization of leased asset General and administrative 791,670 Interest on lease liabilities Interest expenses on finance leases 373,407 — Total lease expenses $ 2,485,372 $ 195,686 Operating lease expenses from continuing operations totaled $294,127 and $67,662 for the years ended March 31, 2020 and 2019, respectively. Operating lease expenses from discontinued operations totaled $84,372 and $128,024 for the years ended March 31, 2020 and 2019, respectively. Interest expenses on finance leases from continuing operations totaled $373,407 and $0 for the years ended March 31, 2020 and 2019, respectively. The following table sets forth the Company’s minimum lease payments in future periods: Operating lease Finance lease payments payments Total Twelve months ending March 31, 2021 $ 371,437 $ 3,985,407 $ 4,356,844 Twelve months ending March 31, 2022 193,654 2,300,516 2,494,170 Twelve months ending March 31, 2023 124,195 457,690 581,885 Twelve months ending March 31, 2024 93,188 945 94,133 Twelve months ending March 31, 2025 25,223 — 25,223 Total lease payments 807,697 6,744,558 7,552,255 Less: discount (67,045) (694,497) (761,542) Present value of lease liabilities 740,652 6,050,061 6,790,713 Less: Present value of lease liabilities – discontinued operations (53,899) — (53,899) Present value of lease liabilities – continuing operations $ 686,753 $ 6,050,061 $ 6,736,814 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Mar. 31, 2020 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | 20. COMMITMENTS AND CONTINGENCIES Purchase Commitments As of March 31, 2020, the Company has a purchase commitment of 50 automobiles for a total purchase price of approximately $699,000, which is expected to be completed by the end of December 2020. Contingencies In measuring the credit risk of guarantee services to automobile purchasers, the Company primarily reflects the “probability of default” by the automobile purchasers on its contractual obligations and considers the current financial position of the automobile purchasers and its likely future development. The Company manages the credit risk of automobile purchasers by performing preliminary credit checks of each automobile purchaser and ongoing monitoring every month. By using the current credit loss model, management is of the opinion that the Company is bearing the credit risk to repay the principal and interests to the financial institutions if automobile purchasers default on their payments for more than three months. Management also periodically re-evaluates probability of default of automobile purchasers to make adjustments in the allowance when necessary as the Company is the guarantor of the loans. Historically, most of the automobile purchasers would pay the Company their previous defaulted amounts within one to three months. In December 2019, a novel strain of coronavirus, or COVID-19, surfaced and it has spread rapidly to many parts of China and other parts of the world, including the United States. The epidemic has resulted in quarantines, travel restrictions, and the temporary closure of stores and facilities in China and elsewhere. Because substantially all of the Company’s operations are conducted in China, the COVID-19 outbreak had materially adversely affected, and may continue to affect, the Company’s business operations, financial condition and operating results for 2020, including but not limited to decrease in revenues, slower collection of accounts receivables and additional allowance for doubtful accounts. Some of the Company’s customers exited the ride-hailing business and tendered their automobiles to the Company for sublease or sale to generate income or proceeds to cover payments owed to financial institutions and the Company. For the year ended March 31, 2020, the Company recognized estimated provisions loss of approximately $225,000 for the guarantee services because the drivers who exited the ride-hailing business were not able to make the monthly payments. As of March 31, 2020, the maximum contingent liabilities the Company would be exposed to was approximately $18,627,000 (including approximately $497,400 related to the discontinued P2P business), assuming all the automobile purchasers were in default. Automobiles are used as collateral to secure the payment obligations of the automobile purchasers under the financing agreements. The Company estimated the fair market value of the collateral to be approximately $13,918,000 as of March 31, 2020, based on the market price and the useful life of such collateral, which represents about 74.7% of the maximum contingent liabilities. As of March 31, 2020, approximately $1,431,000, including interests of $84,000, due to financial institutions, of all the automobile purchases we serviced were past due as a result of the COVID-19 epidemic in China. The Company has resumed its operation since March 23, 2020. Because of the significant uncertainties surrounding the COVID-19 outbreak, the extent of the business disruption and the related financial impact cannot be reasonably estimated at this time. As of the date of this report, the Company’s operation has been adversely affected which resulted in significant decrease in revenue in the quarter ended March 31, 2020 compared with prior quarters in the same fiscal year. |
PARENT-ONLY FINANCIALS
PARENT-ONLY FINANCIALS | 12 Months Ended |
Mar. 31, 2020 | |
PARENT-ONLY FINANCIALS | |
PARENT-ONLY FINANCIALS | 21. PARENT-ONLY FINANCIALS SENMIAO TECHNOLOGY LIMITED CONDENSED BALANCE SHEETS March 31, March 31, 2020 2019 ASSETS Current Assets Cash and cash equivalents $ 2,590 $ 1,950,347 Due from subsidiaries 2,575,039 1,900,000 Prepayments, other receivables and other assets, net 92,375 208,327 Escrow receivable - 600,000 Total Current Assets 2,670,004 4,658,674 Other Assets Intangible assets 750,000 - Prepayment for intangible asset - 280,000 Investments in subsidiaries - 3,718,896 Total Assets $ 3,420,004 $ 8,657,570 LIABILITIES AND EQUITY Current Liabilities Accrued expenses and other liabilities $ 128,796 $ 282,172 Derivative liabilities 342,530 - Total Current Liabilities 471,326 282,172 Other Liabilities Excess of investments in subsidiaries 144,980 - Total Liabilities 616,306 282,172 Commitments and Contingencies Stockholders' Equity Common stock (par value $0.0001 per share, 100,000,000 shares authorized;29,008,818 and 25,945,255 shares issued and outstanding at March 31, 2020 and 2019, respectively) 2,901 2,595 Additional paid-in capital 27,013,137 23,833,112 Accumulated deficit (23,704,862) (15,031,538) Accumulated other comprehensive loss (507,478) (428,771) Total Senmiao Technology Limited Stockholders' Equity 2,803,698 8,375,398 Total Liabilities and Equity $ 3,420,004 $ 8,657,570 SENMIAO TECHNOLOGY LIMITED CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS For the Years Ended March 31, 2020 2019 General and administrative expenses $ (1,215,156) $ (1,098,416) Other Income, net 359 6,810 Change in fair value of derivative liabilities 1,796,724 - Equity of losses in subsidiaries (9,255,252) (3,458,263) Net loss (8,673,325) (4,549,869) Foreign currency translation adjustment (78,707) (175,010) Comprehensive loss attributable to stockholders $ (8,752,032) $ (4,724,879) SENMIAO TECHNOLOGY LIMITED CONDENSED STATEMENTS OF CASH FLOWS For the Years Ended March 31, 2020 2019 Cash Flows from Operating Activities: Net loss $ (8,673,325) $ (4,549,869) Adjustments to reconcile net loss to net cash used in operating activities: Equity of loss of subsidiaries 9,255,252 3,458,263 Stock compensation expense 133,150 44,200 Change in fair value of derivative liabilities (1,796,724) - Change in operating assets and liabilities Prepayments, receivables and other assets 115,952 (168,362) Accrued expenses and other liabilities (109,176) 84,890 Net Cash Used in Operating Activities (1,074,871) (1,130,878) Cash Flows from Investing Activities: Purchase of intangible assets (470,000) - Deposits in intangible assets - (280,000) Working capital contribution for subsidiaries (5,470,082) (6,300,000) Net Cash Used in Investing Activities (5,940,082) (6,580,000) Cash Flows from Financing Activities: Net proceeds from issuance of common stock in registered direct offering 5,142,124 - Net proceeds from issuance of common stock upon warrants exercised 111 - Proceeds borrowed from stockholders - 154 Repayment of borrowing to stockholders - (1,900,000) Borrowings to subsidiaries (675,039) - Release of escrow receivable 600,000 600,000 Net Cash Provided by (Used in) Financing Activities 5,067,196 (1,299,846) Net decrease in cash and cash equivalents (1,947,757) (9,010,724) Cash and cash equivalents, beginning of year 1,950,347 10,961,071 Cash and cash equivalents, end of year $ 2,590 $ 1,950,347 Supplemental Cash Flow Information Cash paid for interest expense $ - $ - Cash paid for income tax $ - $ - Non-cash Transaction in Investing and Financing Activities IPO expenses paid by the Company’s stockholders $ - $ 70,687 Prepayments in exchange of intangible assets $ 280,000 $ - Allocation of fair value of derivative liabilities for issuance of common stock proceeds $ 3,150,006 $ - Allocation of fair value of derivative liabilities to additional paid in capital upon warrants exercised $ 1,010,752 $ - Issuance of restricted stock units from accrued expenses and other liabilities $ 44,200 $ - a) Basis of presentation The condensed financial information of Senmiao Technology Limited, has been prepared using the same accounting policies as set out in the consolidated financial statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted by reference to the consolidated financial statements. b) Investments in subsidiaries and equity of loss in subsidiaries The investments in subsidiaries consist of investments in Senmiao Consulting, Hunan Ruixi and Yicheng. The equity losses in subsidiaries consist of equity loss in Senmiao Consulting, Hunan Ruixi and Yicheng. c) Stockholders’ equity Restricted Stock Units On July 31, 2018, the Board approved the issuance of 5,000 restricted stock units (“RSUs”) to each of the five directors as stock compensation for their services for the Company’s fiscal year ending March 31, 2019. Total RSUs granted to the five directors were 25,000 for an aggregate fair value of $117,750. Pursuant to the Restricted Stock Unit Award Agreements (“Award Agreements”) on August 3, 2018, the RSUs vest in four equal quarterly installments on August 3, 2018, April 1, 2019, July 1, 2019 and October 1, 2019 or in full upon the occurrence of a change in control of the Company, subject to the terms and conditions set forth in the Award Agreements, provided that the director remains in service as a director through the applicable vesting date. The RSUs will be settled by the Company’s issuance of shares of common stock in certificated or uncertificated form upon the earlier of (i) a change in control and (ii) the director’s cessation as a director of the Company due to a “separation of service” within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended, or the director’s death or disability. As of March 31, 2019, the first installment of 6,250 RSUs vested. The fair value of the vested RSUs is calculated at the grant date market price of the Company’s common stock multiplying by the number of vested shares. On December 11, 2019, the Board approved the issuance of 30,303 RSUs to each of the Company’s five directors as stock compensation for their services for the Company’s fiscal year ending March 31, 2020. As of March 31, 2020, the Company issued a total of 169,015 RSUs and accounted for as expenses and charged to common stock. Registered Direct Offering On April 15, 2019, the SEC declared effective the Company’s Registration Statement on Form S-3, pursuant to which, along with the accompanying prospectus, the Company registered up to $80,000,000 in aggregate principal amount of its common stock, preferred stock, debt securities, warrants, rights and/or units. On June 21, 2019, the Company closed a registered direct offering of an aggregate of 1,781,361 shares of its common stock, and in connection therewith, issued to the investors (i) for no additional consideration, Series A warrants to purchase up to an aggregate of 1,336,021 shares of common stock and (iii) for nominal additional consideration, Series B warrants to purchase up to a maximum aggregate of 1,116,320 shares of common stock. The Company sold the shares of common stock at a price of $3.38 per share (the “Share Purchase Price”). The Company received gross proceeds from the offering, before deducting estimated offering expenses payable by the Company, of approximately $6,000,000. The Series A warrants are exercisable immediately upon issuance at an exercise price of $3.72 per share and will expire on the fourth (4th) anniversary of the original issue date. In the event that on December 20, 2019, the exercise price is greater than the Six Month Adjustment Price as defined below, on the trading day immediately following December 20, 2019 (the “Six Month Measuring Date”), the exercise price shall automatically adjust to the Six Month Adjustment Price (as adjusted for stock splits, stock dividends, stock combinations, recapitalizations and similar events). Six Month Adjustment Price means the greater of (x) $1.50 (as adjusted for any stock dividend, stock split, stock combination, reclassification or similar transaction) and (y) 100% of the quotient of (I) the sum of the five lowest VWAPs of the common stock during the ten consecutive trading day period ending and including the Six Month Measuring Date, divided by (II) five. All such determinations to be appropriately adjusted for any stock dividend, stock split, stock combination, reclassification or similar transaction during such period. The exercise price of the Series A warrant was adjusted from $3.72 to $1.50 per share on December 20, 2019. The Series B warrants are pre-funded warrants and are being issued as a true-up with respect to the shares of common stock. The maximum aggregate number of shares of common stock issuable upon exercise of the Series B warrants is 1,116,320. Initially, the Series B warrants shall not be exercisable for any shares of common stock. In the event that on the fiftieth (50th) day after the closing date (the “Adjustment Measuring Time”), the closing price of the common stock is less than the Share Purchase Price, then the number of shares of common stock issuable upon exercise of the Series B warrants shall be adjusted (upward or downward, as applicable) to the greater of (i) zero (0) and (ii) such aggregate number of shares of common stock equal to fifty percent (50%) of the difference of (A) the quotient of (x) the Share Purchase Price divided by (y) the Market Price (as defined in Purchase Agreement) as of the Adjustment Measuring Time, less (B) the aggregate number of shares of common stock issued to the investors at the closing (as adjusted for share splits, share dividends, share combinations, recapitalizations and similar events). During the year ended March 31, 2020, the Company issued an aggregate of 1,113,187 shares of common stock to certain investors in the June 2019 offering upon exercise of the pre-funded Series B warrants for a total consideration of $111. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Mar. 31, 2020 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | 22. SUBSEQUENT EVENTS On July 4, 2020, Hunan Ruixi, Jinkailong and the other shareholders of Jinkailong entered into an agreement (the “JKL Investment Agreement”) with Hongyi Industrial Group Co., Ltd. (“Hongyi”). Pursuant to the JKL Investment Agreement, Jinkailong agreed to issue and Hongyi agreed to subscribe for a 27.03% equity interest in Jinkailong in consideration of RMB50 million (approximately $7.0 million) (the “Investment”). The Investment will be made in two payments: (i) the first payment of RMB10 million (approximately $1.4 million) is due no later than September 30, 2020 and (ii) the remaining RMB40 million (approximately $5.6 million) is due within 30 days after the record-filing of the Investment has been made with the local PRC government and the other shareholders of Jinkailong having made their respective capital contributions in full in cash, but no later than December 31, 2020. As a result, Hunan Ruixi will be required to pay RMB3.5 million (approximately $0.5 million) to Jinkailong as a capital contribution. Upon the full payment of the consideration, the Investment will be deemed to be closed (the “Closing”). As a result of the Investment, the original shareholders’ ownership percentage will be proportionally diluted but Hunan Ruixi will continue to control Jinkailong pursuant to the Voting Agreements. The JKL Investment Agreement sets performance targets for Jinkailong during a three-year performance commitment period following the Closing. During the performance commitment period, Jinkailong has agreed, and its original shareholders have agreed to cause Jinkailong, to seek to achieve annual revenue for Jinkailong of no less than RMB52 million (approximately $7.4 million), RMB90 million (approximately $12.7 million) and RMB110 million (approximately $15.6 million), respectively, and annual net profit of no less than RMB10 million (approximately $1.4 million), RMB20 million (approximately $2.8 million) and RMB25 million (approximately $3.5 million), respectively, during the first, second and third year of the performance commitment period. The JKL Investment Agreement also provides Hongyi certain shareholder rights, including, but not limited to, the right to receive any undistributed dividends, a right of first refusal for any equity transfer from the other shareholders of Jinkailong, a tag-along right during the performance commitment period, anti-dilution rights, redemption rights, subscription rights and priority in liquidation or dissolution of Jinkailong. Specifically, pursuant to the redemption right provision in the JKL Investment Agreement, in the event that Jinkailong (i) fails to become public through an IPO for a valuation of no less than RMB350 million (approximately $49.5 million) or merge with a public company for a valuation of no less than RMB300 million (approximately $42.5 million) within the six months following the performance commitment period, (ii) fails to achieve an accumulated net profit of RMB24 million (approximately $3.4 million) for the first two years of the performance commitment period or a net profit of RMB20 million (approximately $2.9 million) for the third year of the performance commitment period, or (iii) has any material and adverse change to its core business, including but not limited to being included in the list of dishonest persons and loss of over one third of its online ride-hailing taxi operating licenses, as well as bankruptcy, liquidation or cessation of operations, Hongyi shall have the right to require certain shareholders of Jinkailong (including Hunan Ruixi) to repurchase all of its equity interest in Jinkailong. Based on a repurchase formula provided for in the JKL Investment Agreement, the maximum repurchase amount that Hunan Ruixi would be subject to is RMB28,320,000 (approximately $4.0 million). |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Mar. 31, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis of presentation | (a) Basis of presentation The accompanying consolidated financial statements of the Company has been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). |
Basis of consolidation | (b) Basis of consolidation The consolidated financial statements include the accounts of the Company and include the assets, liabilities, revenues and expenses of the subsidiaries and VIEs. All inter-Company accounts and transactions have been eliminated in consolidation. |
Foreign currency translation | (c) Foreign currency translation Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing on the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates on the date of the balance sheet. The resulting exchange differences are recorded in the statement of operations. The reporting currency of the Company and its subsidiaries and VIEs is U.S. dollars (“US$”) and the accompanying consolidated financial statements have been expressed in US$. However, the Company maintains the books and records in its functional currency, Chinese Renminbi (“RMB”), being the functional currency of the economic environment in which its operations are conducted. In general, for consolidation purposes, assets and liabilities of the Company and its subsidiaries whose functional currency is not the US$, are translated into US$, using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements of the Company and its subsidiaries and VIEs are recorded as a separate component of accumulated other comprehensive income within the statement of stockholders’ equity. Translation of amounts from RMB into US$ has been made at the following exchange rates for the respective periods: March 31, March 31, 2020 2019 Balance sheet items, except for equity accounts 7.0824 6.7119 For the Years Ended March 31, 2020 2019 Items in the statements of operations and comprehensive loss, and statements of cash flows 6.9472 6.7008 |
Use of estimates | (d) Use of estimates In presenting the consolidated financial statements in accordance with U.S. GAAP, management make estimates and assumptions that affect the amounts reported and related disclosures. Estimates, by their nature, are based on judgement and available information. Accordingly, actual results could differ from those estimates. On an ongoing basis, management reviews these estimates and assumptions using the currently available information. Changes in facts and circumstances may cause the Company to revise its estimates. The Company bases its estimates on past experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. The inputs into our judgments and estimates consider the economic implications of COVID-19 on the Company’s critical and significant accounting estimates. Estimates are used when accounting for items and matters including, but not limited to, revenue recognition, residual values, lease classification and liabilities, finance lease receivables, inventory obsolescence, right-of-use assets, determinations of the useful lives and valuation of long-lived assets, estimates of allowances for doubtful accounts and prepayments, estimates of impairment of intangible assets, valuation of deferred tax assets, estimated fair value used in business acquisitions, valuation of derivative liabilities, allocation of fair value of derivative liabilities issuance of common stock and warrants exercised and other provisions and contingencies. |
Fair values of financial instruments | (e) Fair values of financial instruments Accounting Standards Codification (“ASC”) Topic 825, Financial Instruments (“Topic 825”) requires disclosure of fair value information of financial instruments, whether or not recognized in the balance sheets, for which it is practicable to estimate that value. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. Topic 825 excludes certain financial instruments and all nonfinancial assets and liabilities from its disclosure requirements. Accordingly, the aggregate fair value amounts do not represent the underlying value of the Company. The three levels of valuation hierarchy are defined as follows: Level 1 Inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2 Inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the assets or liability, either directly or indirectly, for substantially the full term of the financial instruments. Level 3 Inputs to the valuation methodology are unobservable and significant to the fair value. The following table sets forth by level within the fair value hierarchy our financial assets and liabilities that were accounted for at fair value on a recurring basis as of March 31, 2020: Carrying Value at Fair Value Measurement at March 31, 2020 March 31, 2020 Level 1 Level 2 Level 3 Derivative liabilities $ 342,530 $ — $ — $ 342,530 The following is a reconciliation of the beginning and ending balance of the assets and liabilities measured at fair value on a recurring basis for the year ended March 31, 2020: March 31, 2020 Beginning balance $ — Derivative liabilities recognized at grant date on June 20, 2019 3,150,006 Change in fair value of derivative liabilities (1,796,724) Fair value of Series B warrants exercised (1,010,752) Ending balance $ 342,530 On June 21, 2019, the Company closed a registered direct offering of an aggregate of 1,781,361 shares of common stock, and in connection therewith, issued to the investors (i) for no additional consideration, Series A warrants to purchase up to an aggregate of 1,336,021 shares of common stock, (ii) for nominal additional consideration, Series B warrants to purchase up to a maximum aggregate of 1,116,320 shares of common stock and (iii) placement agent warrants to purchase up to 142,509 shares of common stock. The strike price of the Company's Series A and Series B warrants and the placement agent warrants are denominated in US$and the Company's functional currency is RMB, therefore, those warrant shares are not considered indexed to the Company's own stock which should be classified as derivative liability. The Company's Series A and Series B warrants and the placement agent warrants are not traded in an active securities market; therefore, the Company estimates the fair value to those warrants using the Black-Scholes valuation model on June 20, 2019 (the grant date) and March 31, 2020. June 20, 2019 Series A Series B Placement Agent Warrants Warrants Warrants # of shares exercisable 1,336,021 1,116,320 142,509 Valuation date 6/20/2019 6/20/2019 6/20/2019 Exercise price $ 3.72 $ 3.72 $ 3.38 Stock price $ 2.80 $ 2.80 $ 2.80 Expected term (year) 4.00 1.00 4.00 Risk-free interest rate 1.77 % 1.91 % 1.77 % Expected volatility 86 % 91 % 86 % March 31, 2020 Series A Series B Placement Agent Warrants Warrants Warrants # of shares exercisable 1,336,021 3,132 142,509 Valuation date 3/31/2020 3/31/2020 3/31/2020 Exercise price $ 1.50 $ 0.0001 $ 3.38 Stock price $ 0.44 $ 0.44 $ 0.44 Expected term (year) 3.22 0.22 3.22 Risk-free interest rate 0.30 % 0.11 % 0.30 % Expected volatility 122 % 127 % 122 % As of March 31, 2020 and 2019, financial instruments of the Company comprised primarily current assets and current liabilities including cash and cash equivalents, accounts receivable, finance lease receivables, prepayments, other receivables and other assets, escrow receivables, due from related parties, borrowings from financial institutions and third parties, accounts payable, advance from customers, lease liabilities, accrued expenses and other liabilities, due to stockholders and due to related parties and affiliates, which approximate their fair values because of the short-term nature of these instruments, and noncurrent liabilities of borrowings from financial institutions, which approximate their fair values because of the stated loan interest rate to the rate charged by similar financial institutions. The noncurrent portion of accounts receivables, finance lease receivables, and lease liabilities were recorded at gross adjusted for the deferred interest income using the effective interest rate method. The Company believes that the effective interest rates underlying these instruments approximate their fair values because of the Company used its incremental borrowing rate to recognize the present value of these instruments as of March 31, 2020 and 2019. Other than as listed above, the Company did not identify any assets or liabilities that are required to be presented on the balance sheet at fair value. |
Business combinations and noncontrolling interests | (f) Business combinations and noncontrolling interests The Company accounts for its business combinations using the acquisition method of accounting in accordance with ASC 805 "Business Combinations." The cost of an acquisition is measured as the aggregate of the acquisition date fair value of the assets transferred to the sellers and liabilities incurred by the Company and equity instruments issued. Transaction costs directly attributable to the acquisition are expensed as incurred. Identifiable assets and liabilities acquired or assumed are measured separately at their fair values as of the acquisition date, irrespective of the extent of any noncontrolling interests. The excess of (i) the total costs of acquisition, fair value of the noncontrolling interests and acquisition date fair value of any previously held equity interest in the acquiree over (ii) the fair value of the identifiable net assets of the acquiree is recorded as goodwill. If the cost of acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognized directly in the consolidated income statements. During the measurement period, which can be up to one year from the acquisition date, the Company may record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. Upon the conclusion of the measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to the consolidated income statements. For the Company’s non-wholly owned subsidiaries, a noncontrolling interest is recognized to reflect portion of equity that is not attributable, directly or indirectly, to the Company. The cumulative results of operations attributable to noncontrolling interests are also recorded as noncontrolling interests in the Company’s consolidated balance sheets and consolidated statements of operations and comprehensive loss. Cash flows related to transactions with noncontrolling interests are presented under financing activities in the consolidated statements of cash flows. |
Segment reporting | (g) Segment reporting Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker (the “CODM”), which is comprised of certain members of the Company’s management team. Historically, the Company had one single operating and reportable segment, namely the provision of an online lending services. During the year ended March 31, 2019, the Company acquired Hunan Ruixi and Jinkailong and evaluated how the CODM manages the businesses of the Company to maximize efficiency in allocating resources and assessing performance. Consequently, the Company presents two operating and reportable segments as set forth in Note 2(p). The Company has discontinued the online P2P lending services segment and has only one segment in the period after October 17, 2019. |
Cash and cash equivalents | (h) Cash and cash equivalents Cash and cash equivalents primarily consist of bank deposits with original maturities of three months or less, which are unrestricted as to withdrawal and use. Cash and cash equivalents also consist of funds received from automobile purchasers as payment for automobiles, related insurances and taxes to be paid on behalf of the automobile purchasers, which funds were held at the third party platforms' fund accounts and which are unrestricted and immediately available for withdrawal and use. |
Accounts receivable, net | (i) Accounts receivable, net Accounts receivable are recorded at the invoiced amount less an allowance for any uncollectible accounts and do not bear interest, and are due on demand. Management reviews the adequacy of the allowance for doubtful accounts on an ongoing basis, using historical collection trends and aging of receivables. Management also periodically evaluates individual customer’s financial condition, credit history and the current economic conditions to make adjustments in the allowance when necessary. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. As of March 31, 2020 and 2019, allowance for doubtful accounts amounted to $379,689 and $0, respectively. |
Inventories | (j) Inventories Inventories consist of automobiles which are held primarily for sale and for leasing purposes, and are stated at lower of cost or net realizable value, as determined using the weighted average cost method. Management compares the cost of inventories with the net realizable value and if applicable, an allowance is made for writing down the inventory to its net realizable value, if lower than cost. On an ongoing basis, inventories are reviewed for potential write-down for estimated obsolescence or unmarketable inventories which equals the difference between the costs of inventories and the estimated net realizable value based upon forecasts for future demand and market conditions. When inventories are written-down to the lower of cost or net realizable value, it is not marked up subsequently based on changes in underlying facts and circumstances. |
Finance lease receivables, net | (k) Finance lease receivables, net Finance lease receivables, which result from sales-type leases, are measured at discounted present value of (i) future minimum lease payments, (ii) any residual value not subject to a bargain purchase option as a finance lease receivables on its balance sheet and (iii) accrued interest on the balance of the finance lease receivables based on the interest rate inherent in the applicable lease over the term of the lease. Management also periodically evaluates individual customer’s financial condition, credit history and the current economic conditions to make adjustments in the allowance when necessary. Finance lease receivables is charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. As of March 31, 2020 and 2019, the Company determined no allowance for doubtful accounts was necessary for finance lease receivables. As of March 31, 2020 and 2019, finance lease receivables consisted of the following: March 31, March 31, 2020 2019 Gross minimum lease payments receivable $ 1,606,230 $ 40,023 Less: Amounts representing estimated executory costs - - Minimum lease payments receivable 1,606,230 40,023 Less Allowance for uncollectible minimum lease payments receivable - - Net minimum lease payments receivable 1,606,230 40,023 Less: Unearned interest (412,975) (7,471) Financing lease receivables, net $ 1,193,255 $ 32,552 Finance lease receivables, net, current portion $ 459,110 $ 10,254 Finance lease receivables, net, noncurrent portion $ 734,145 $ 22,298 Future scheduled minimum lease payments for investments in sales-type leases as of March 31, 2020 are as follows: Minimum future payments receivable Year ending March 31, 2021 $ 607,718 Year ending March 31, 2022 570,944 Year ending March 31, 2023 341,389 Year ending March 31, 2024 86,179 Total $ 1,606,230 |
Property and equipment, net | (l) Property and equipment, net Property and equipment primarily consists of computer equipment, which is stated at cost less accumulated depreciation less any provision required for impairment in value. Depreciation is computed using the straight-line method with no residual value based on the estimated useful life. The useful life of property and equipment is summarized as follows: Categories Useful life Leasehold improvements Shorter of the remaining lease terms or estimated useful lives Computer equipment 2 - 5 years Office equipment 3 - 5 years Automobiles 3 - 4 years The Company reviews property and equipment for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An asset is considered impaired if its carrying amount exceeds the future net undiscounted cash flows that the asset is expected to generate. If such asset is considered to be impaired, the impairment recognized is the amount by which the carrying amount of the asset, if any, exceeds its fair value determined using a discounted cash flow model. For the years ended March 31, 2020 and 2019, there was no impairment of property and equipment. Costs of repairs and maintenance are expensed as incurred and asset improvements are capitalized. The cost and related accumulated depreciation of assets disposed of or retired are removed from the accounts, and any resulting gain or loss is reflected in the consolidated income statements. |
Intangible assets, net | (m) Intangible assets, net Purchased intangible assets are recognized and measured at fair value upon acquisition. Separately identifiable intangible assets that have determinable lives continue to be amortized over their estimated useful lives using the straight-line method as follows: Categories Useful life Platform 7 years Customer relationship 10 years Software 5-10 years Separately identifiable intangible assets to be held and used are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Determination of recoverability is based on an estimate of undiscounted future cash flows resulting from the use of the asset and its eventual disposition. Measurement of any impairment loss for identifiable intangible assets is based on the amount by which the carrying amount of the assets exceeds the fair value of the assets. For the years ended March 31, 2020 and 2019, there was a $265,525 and $0 impairment, respectively, on customer relationship from Sichuan Senmiao as a result of the Company's decision to discontinue the P2P lending business in October 2019. |
Loss per share | (n) Loss per share Basic loss per share is computed by dividing net loss attributable to stockholders by the weighted average number of outstanding shares of common stock, adjusted for outstanding shares of common stock that are subject to repurchase. For the calculation of diluted loss per share, net loss attributable to stockholders for basic earnings loss per share is adjusted by the effect of dilutive securities, including share-based awards, under the treasury stock method. Potentially dilutive securities, of which the amounts are insignificant, have been excluded from the computation of diluted net loss per share if their inclusion is anti-dilutive. |
Derivative liabilities | (o) Derivative liabilities A contract is designated as an asset or a liability and is carried at fair value on the Company's balance sheet, with any changes in fair value recorded in the Company's results of operations. The Company then determines which options, warrants and embedded features require liability accounting and records the fair value as a derivative liability. The changes in the values of these instruments are shown in the accompanying consolidated statements of operations and comprehensive loss as "change in fair value of derivative liabilities". |
Revenue recognition | (p) Revenue recognition The Company adopted ASC 606, Revenue from Contracts with Customers (“ASC 606") on April 1, 2018 using the modified retrospective approach. ASC 606 establishes principles for reporting information about the nature, amount, timing and uncertainty of revenue and cash flows arising from the entity’s contracts to provide goods or services to customers. The core principle requires an entity to recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration that it expects to be entitled to receive in exchange for those goods or services recognized as performance obligations are satisfied. It also requires the Company to identify contractual performance obligations and determine whether revenue should be recognized at a point in time or over time, based on when control of goods and services transfers to a customer. To achieve that core principle, the Company applies the five steps defined under ASC 606: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company accounts for a contract with a customer when the contract is committed in writing, the rights of the parties, including payment terms, are identified, the contract has commercial substance and consideration to collect is substantially probable. The Company has assessed the impact of the guidance by reviewing its existing customer contracts and current accounting policies and practices to identify differences that will result from applying the new requirements, including the evaluation of its performance obligations, transaction price, customer payments, transfer of control and principal versus agent considerations. Based on the assessment, the Company concluded that there was no change to the timing and pattern of revenue recognition for its current revenue streams in scope of ASC 606 and therefore there was no material changes to the Company’s consolidated financial statements upon adoption of ASC 606. As of March 31, 2020, the Company had outstanding contracts for automobile transaction and related services amounting to $590,509, of which $387,345 is expected to be completed within twelve months after March 31, 2020, and $203,164 is expected to be completed after March 31, 2021. Disaggregated information of revenues by business lines are as follows: For the Years Ended March 31, 2020 2019 Automobile Transaction and Related Services (Continuing Operations) - Revenues from sales of automobiles $ 11,536,691 $ 1,815,425 - Service fees from automobile purchase services 1,726,717 407,632 - Facilitation fees from automobile transactions 197,815 142,615 - Service fees from management and guarantee services 141,527 60,011 - Financing revenues 164,391 - - Operating lease revenues from automobile rentals 1,303,639 - - Other service fees 584,795 125,424 Total revenues from Automobile Transaction and Related Services (Continuing Operations) 15,655,575 2,551,107 Online Lending Services (Discontinued Operations) - Transaction fees 73,341 331,960 - Service fees 23,833 37,996 - Website development revenue 15,266 - Total revenues from Online Lending Services (Discontinued Operations) 112,440 369,956 Total revenues $ 15,768,015 $ 2,921,063 Automobile transaction and related services Sales of automobiles – The Company generates revenue from sales of automobiles to the customers of Jinkailong, Hunan Ruixi and Mashang Chuxing. The control over the automobile is transferred to the purchaser along with the delivery of automobile. The amount of the revenue is based on the sale price agreed by Hunan Ruixi or Yicheng and the counterparties, including Jinkailong and Mashang Chuxing, who acts on behalf of its customers. The Company recognizes revenues when the automobile is delivered and control is transferred to the purchaser at a point in time. Service fees from automobile purchase services– Services fees from automobile purchase services are paid by automobile purchasers for a series of the services provided to them throughout the purchase process such as credit assessment, preparation of financing application materials, assistance with closing of financing transactions, license and plate registration, payment of taxes and fees, purchase of insurance, installment of GPS devices, ride-hailing driver qualification and other administrative procedures. The amount of these fees is based on the sales price of the automobiles and relevant services provided. The Company recognizes revenue when all the services are completed and the automobile is delivered to the purchaser at a point in time. Facilitation fees from automobile transactions – Facilitation fees from automobile purchase transactions are paid by the Company’s customers including third-party sales teams or the automobile purchasers for the facilitation of the sales and financing of automobiles. The Company attracts automobile purchasers through third-party sales teams or its own sales department. For the sales facilitated between third-party sales teams and automobile purchasers, the Company charges the fees to the third-party sales teams, which derived from the commission paid by the automobile purchasers to the third-party sales teams. Relating to sales facilitated between automobile purchasers and dealers, the Company charges the fees to the automobile purchasers. The Company recognizes revenue from facilitation fees when the titles are transferred to the purchasers at a point in time. The amount of fees is based on the type of automobile and negotiation with each sales team or automobile purchaser. The fees charged to third-party sales teams or automobile purchasers are paid before the automobile purchase transactions are consummated. These fees are non-refundable upon the delivery of automobiles. Service fees from management and guarantee services – Over 95% of the Company’s customers are drivers of Didi Chuxing Technology Co., Ltd., the largest ride-hailing service platform in China. The drivers sign affiliation agreements with the Company, pursuant to which the Company provides them with management and guarantee services during the affiliation period. Service fees for management and guarantee services are paid by such automobile purchasers on a monthly basis for the management and guarantee services provided during the affiliation period. The Company recognizes revenue over the affiliation period when performance obligations are completed. Financing revenues - Interest income from the lease arising from the Company's sales-type leases and bundled lease arrangements are recognized as financing revenues over the lease term based on the effective rate of interest in the lease. Operating lease revenues from automobile rentals -The Company generates revenue from sub-leasing automobiles from some online ride-hailing drivers or leasing its own automobiles. The Company recognizes revenue wherein the automobile is transferred to the leasee and the leasee has the ability to control the asset, is accounted for under ASC Topic 842. Rental transactions are satisfied over the rental period. Rental periods are short term in nature, generally are twelve months or less. Lease On April 1, 2019, the Company adopted ASU 2016-02, Leases (ASC Topic 842). This update, as well as additional amendments and targeted improvements issued in 2018 and early 2019, supersedes existing lease accounting guidance found under ASC 840, Leases ("ASC 840"). The accounting for lessors does not fundamentally change with this update except for changes to conform and align guidance to the lessee guidance, as well as to the revenue recognition guidance in ASU 2014-09, Revenue from Contracts with Customers (ASC Topic 606). Some of these conforming changes, such as those related to the definition of lease term and minimum lease payments, resulted in certain lease arrangements, that would have been previously accounted for as operating leases, to be classified and accounted for as sales-type leases with a corresponding up-front recognition of automobile sales revenue when the lessee obtained control over the automobile. The two primary accounting provisions the Company uses to classify transactions as sales-type or operating leases are: (i) a review of the lease term to determine if it is for the major part of the economic life of the underlying equipment (defined as greater than 75)%; and (ii) a review of the present value of the lease payments to determine if they are equal to or greater than substantially all of the fair market value of the equipment at the inception of the lease (defined as greater than 90)%. Automobile included in arrangements meeting these conditions are accounted for as sales-type leases. Interest income from the lease is recognized in financing revenues over the lease term. Automobile included in arrangements that do not meet these conditions are accounted for as operating leases and revenue is recognized over the term of the lease. The Company excludes from the measurement of its lease revenues any tax assessed by a governmental authority that is both imposed on and concurrent with a specific revenue-producing transaction and collected from a customer. The Company considers the economic life of most of the automobiles to be three to four years, since this represents the most common lease term for its automobiles and the automobiles will be used for ride-hailing services. The Company believes three to four years is representative of the period during which an automobile is expected to be economically usable, with normal service, for the purpose for which it is intended. A portion of the Company's direct sales of automobile to end customers are made through bundled lease arrangements which typically include automobile, services (automobile purchase services, facilitation services, and management and guarantee services) and financing components where the customer pays a single negotiated fixed minimum monthly payment for all elements over the contractual lease term. Revenues under these bundled lease arrangements are allocated considering the relative standalone selling prices of the lease and non-lease deliverables included in the bundled arrangement and the financing components. Lease deliverables include the automobile and financing, while the non-lease deliverables generally consist of the services and repayment of advanced fees made on behalf of its customers. The Company considers the fixed payments for purposes of allocation to the lease elements of the contract. The fixed minimum monthly payments are multiplied by the number of months in the contract term to arrive at the total fixed lease payments that the customer is obligated to make over the lease term. Amounts allocated to the automobile and financing elements are then subjected to the accounting estimates under ASC 842 to ensure the values reflect standalone selling prices. The remainder of any fixed payments are allocated to non-lease elements (automobile purchase services, facilitation fees, and management and guarantee services), for which these revenues are recognized in a manner consistent with the guidance for service fees from automobile purchase services, facilitation fees from automobile transactions, and service fees from management and guarantee services as discussed above. The Company's lease pricing interest rates, which are used in determining customer payments in a bundled lease arrangement, are developed based upon the local prevailing rates in the marketplace where its customer will be able to obtain an automobile loan under similar terms from the bank. The Company reassesses its pricing interest rates quarterly based on changes in the local prevailing rates in the marketplace. As of March 31, 2020, the Company's pricing interest rate was 6.0% per annum. Online P2P Lending Services (Discontinued Operations) Transaction fees – Prior to the Company’s P2P lending business being discontinued on October 17, 2019, transaction fees were paid by borrowers to the Company for the work the Company performed through its platform. The amount of these fees was based upon the loan amount and the maturity date of the loan. The fees charged to borrowers were paid upon (i) disbursement of the proceeds for loans which accrued interest on a monthly basis or (ii) full payment of principal and interest of loans which accrued interest on a daily basis. These fees were non-refundable upon the issuance of loan. The Company recognized revenue when loan proceeds were disbursed to borrowers or borrowers paid their principal and interest on loans. Service fees – The Company charged investors service fees on their actual return of investment (interest income). The Company generally received the service fees upon the investors’ receipt of their investment returns. The Company recognized revenue when loans were repaid and investors received their investment income. Website development revenues – Revenue allocated to website development services is recognized as the service is performed over time using the Company’s efforts or inputs to the satisfaction of a performance obligation using an input measure method, under which the total value of revenue is recognized on the basis of the percentage that total cost to date bears to the total expected costs. The Company considers labor costs and related outsource labor costs for the input measurement as the best available indicator of the progress, pattern and timing in which contract obligations are fulfilled. Provisions for estimated losses, if any, on uncompleted contracts are recorded in the period in which such losses become probable based on the current contract estimates. In instances where substantive acceptance provisions are specified in customer contracts, revenues are deferred until all acceptance criteria have been met. To date, the Company has not incurred a material loss on any contracts. However, as a policy, provisions for estimated losses on such engagements will be made during the period in which a loss becomes probable and can be reasonably estimated. The Company generally does not enter into arrangements with multiple deliverables for website development services contracts. If the deliverables have standalone value at contract inception, the Company accounts for each deliverable separately. |
Income taxes | (q) Income taxes Deferred income tax liabilities and assets are recognized for the expected future tax consequences of temporary differences between the income tax basis and financial reporting basis of assets and liabilities. Provisions or benefits for income taxes consists of tax estimated from taxable income plus or minus deferred tax expenses (benefits) if applicable. Deferred tax is calculated using the balance sheet liability method in respect of temporary differences arising from differences between the carrying amount of assets and liabilities in the financial statements and the corresponding tax basis. Deferred tax assets are recognized to the extent that it is probable that taxable income will be utilized with prior net operating loss carried forwards using tax rates that are expected to apply to the period when the asset is realized or the liability is settled. Deferred tax is charged or credited in the income statement, except when it is related to items credited or charged directly to equity. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be utilized. Current income taxes are provided for in accordance with the laws of the relevant tax authorities. An uncertain tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. Penalties and interest incurred related to underpayment of income tax are classified as income tax expense in the period incurred. The Company did not have any significant unrecognized uncertain tax positions or any unrecognized liabilities, interest or penalties associated with unrecognized tax benefit as of March 31, 2020 and 2019. As of March 31, 2020, the calendar years ended December 31, 2015 through 2019 for the Company’s PRC entities remain open for statutory examination by PRC tax authorities. |
Comprehensive loss | (r) Comprehensive loss Comprehensive loss includes net loss and foreign currency adjustments. Comprehensive loss is reported in the consolidated statements of operations and comprehensive loss. Accumulated other comprehensive loss, as presented on the consolidated balance sheets are the cumulative foreign currency translation adjustments. |
Share-based awards | (s) Share-based awards Share-based awards granted to the Company’s employees are measured at fair value on grant date and share-based compensation expense is recognized (i) immediately at the grant date if no vesting conditions are required, or (ii) using the accelerated attribution method, net of estimated forfeitures, over the requisite service period. The fair value of restricted shares is determined with reference to the fair value of the underlying shares. At each date of measurement, the Company reviews internal and external sources of information to assist in the estimation of various attributes to determine the fair value of the share-based awards granted by the Company, including but not limited to the fair value of the underlying shares, expected life, expected volatility and expected forfeiture rates. The Company is required to consider many factors and make certain assumptions during this assessment. If any of the assumptions used to determine the fair value of the share-based awards changes significantly, share-based compensation expense may differ materially in the future from that recorded in the current reporting period. |
Leases | (t) Leases Prior to March 31, 2019, leases are classified as either capital or operating leases as lessee. Leases that transfer substantially all the benefits and risks incidental to the ownership of assets are accounted for as if there was an acquisition of an asset and incurrence of an obligation at the inception of the lease. All other leases are accounted for as operating leases and are included in the consolidated statements of operations on a straight-line basis over the term of the leases. Leases are classified as either operating lease, sales-type lease, or direct finance leases as lessor. On April 1, 2019, the Company adopted ASU 2016-02, Leases (ASC Topic 842). This update supersedes existing lease accounting guidance found under ASC 840, Leases ("ASC 840") and requires the recognition of right-of-use ("ROU") assets and lease obligations ("lease liabilities") by lessees for those leases currently classified as operating leases under existing lease guidance. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition. Short term leases with a term of twelve months or less are not required to be recognized. Lessor accounting is generally the same under ASC 842 as compared to ASC 840 except with an additional requirement to assess collectability to support classification as a direct financing lease. Also, in order to derecognize the asset and record revenue, collection of payments due must be probable for sales-type leases and the lessees of sales-type leases will need to obtain control over the leased asset. The Company adopted the practical expedient that allows lessees to treat the lease and non-lease components of a lease a single lease component. The impact of the adoption of the ASC 842, as of April 1, 2019, the Company recognized $246,227 ROU assets and $247,325 lease liabilities, primarily related to operating leases of facilities. The adoption of this standard resulted in the recording of operating lease assets and operating lease liabilities as of April 1, 2019, with no related impact on the Company's consolidated statement of changes in stockholders' equity or consolidated statements of operations and comprehensive loss. During the year ended March 31, 2020, the Company entered into certain agreements as a lessor under which it leased automobiles to short-term (usually under 12 months) car service drivers. The Company also entered into certain agreements as a lessee to lease automobiles and to conduct its automobiles rental operations. If any of the following criteria are met, the Company classifies the lease as a finance lease (as a lessee) or as a direct financing or sales-type lease (both as a lessor): · The lease transfers ownership of the underlying asset to the lessee by the end of the lease term; · The lease grants the lessee an option to purchase the underlying asset that the Company is reasonably certain to exercise; · The lease term is for 75% or more of the remaining economic life of the underlying asset, unless the commencement date falls within the last 25% of the economic life of the underlying asset; · The present value of the sum of the lease payments equals or exceeds 90% of the fair value of the underlying asset; or · The underlying asset is of such a specialized nature that it is expected to have no alternative use to the lessor at the end of the lease term. Leases that do not meet any of the above criteria are accounted for as operating leases. The Company combines lease and non-lease components in its contracts under Topic 842, when permissible. Finance and operating lease ROU assets and lease liabilities are recognized at the adoption date of April 1, 2019 or the commencement date, whichever is earlier, based on the present value of lease payments over the lease term. Since the implicit rate for the Company’s leases is not readily determinable, the Company use its incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The incremental borrowing rate is the rate of interest that the Company would have to pay to borrow, on a collateralized basis, an amount equal to the lease payments, in a similar economic environment and over a similar term. Lease terms used to calculate the present value of lease payments generally do not include any options to extend, renew, or terminate the lease, as the Company does not have reasonable certainty at lease inception that these options will be exercised. The Company generally consider the economic life of its operating lease ROU assets to be comparable to the useful life of similar owned assets. The Company has elected the short-term lease exception, therefore operating lease ROU assets and liabilities do not include leases with a lease term of twelve months or less. Its leases generally do not provide a residual guarantee. The finance or operating lease ROU asset also excludes lease incentives. Lease expense is recognized on a straight-line basis over the lease term for operating lease. Meanwhile, the Company recognizes the finance leases ROU assets and interest on an amortized cost basis. The amortization of finance ROU assets is recognized on an accretion basis as amortization expense, while the lease liability is increased to reflect interest on the liability and decreased to reflect the lease payments made during the period. Interest expense on the lease liability is determined each period during the lease term as the amount that results in a constant periodic interest rate of the automobile loans on the remaining balance of the liability. The Company reviews the impairment of its ROU assets consistent with the approach applied for its other long-lived assets. The Company reviews the recoverability of its long-lived assets when events or changes in circumstances occur that indicate that the carrying value of the asset may not be recoverable. The assessment of possible impairment is based on its ability to recover the carrying value of the asset from the expected undiscounted future pre-tax cash flows of the related operations. The Company has elected to include the carrying amount of finance and operating lease liabilities in any tested asset group and include the associated lease payments in the undiscounted future pre-tax cash flows. For the years ended March 31, 2020 and 2019, the Company recognized an impairment loss of $70,984 and $0, respectively, on its finance lease ROU assets. |
Significant risks and uncertainties | (u) Significant risks and uncertainties 1) Credit risk a. Assets that potentially subject the Company to significant concentration of credit risk primarily consist of cash and cash equivalents. The maximum exposure of these assets to credit risk is their carrying amount as of the balance sheet dates. On March 31, 2020 and 2019, approximately $2,600 and $1,950,000, respectively,was deposited with a bank in the United States which is insured by the U.S. government up to $250,000. On March 31, 2020 and 2019, approximately $820,000 and $3,070,000, respectively, were deposited in financial institutions located in mainland China, which were insured by the government authority. Under the Deposit Insurance System in China, an enterprise's deposits at one bank is insured for a maximum of approximately $70,000 (RMB500,000). To limit exposure to credit risk relating to deposits, the Company primarily place cash deposits with large financial institutions in China which management believes are of high credit quality. The Company’s operations are carried out in mainland China. Accordingly, the Company’s business, financial condition and results of operations may be influenced by the political, economic and legal environments in the PRC as well as by the general state of the PRC’s economy. In addition, the Company’s business may be influenced by changes in government policies with respect to laws and regulations, anti-inflationary measures, currency conversion and remittance abroad, rates and methods of taxation and other factors. b. In measuring the credit risk of accounts receivables due from the automobile purchasers (the “customers”), the Company mainly reflects the “probability of default” by the customer on its contractual obligations and considers the current financial position of the customer and the risk exposures to the customer and its likely future development. However, as the Company only commenced the automobile transaction and related services since November 2018, there was limited historic default data and other information to make an estimate on the expected credit losses. Historically, most of the automobile purchasers would pay the Company their previously defaulted amounts within one to three months. As a result, the Company would provide full provisions on accounts receivable if the customers default on repayments for over three months. As of March 31, 2020, the Company provided an allowance for doubtful accounts of $379,689 and wrote off accounts receivables of $1,410,736, which represents due from automobile purchasers. In measuring the credit risk of accounts receivables due from the borrowers and investors (the “P2P customers”), the Company mainly reflects the “probability of default” by the P2P customer on its contractual obligations and considers the current financial position of the P2P customer and the risk exposures to the P2P customer and its likely future development. Historically, most of the borrowers would pay the transaction fee within one year upon (i) disbursement of the proceeds for loans or (ii) full payment of principal and interest of loan. Most of investors would pay the service fee within one year upon receipt of their investment returns. On October 17, 2019, the Board approved the Plan for the Company to discontinue and wind down its online lending services business. As a result, the Company re-evaluated its accounts receivables from the P2P customers and wrote off accounts receivable of $143,668 that has not been received as of March 31, 2020. 2) Foreign currency risk As of March 31, 2020 and March 31, 2019, substantially all of the Company’s operating activities and major assets and liabilities, except for the cash deposit of approximately $818,000 and $3,070,000, respectively, in U.S. dollars, are denominated in RMB, which are not freely convertible into foreign currencies. All foreign exchange transactions take place through either the Peoples’ Bank of China (“PBOC”) or other authorized financial institutions at exchange rates quoted by PBOC. Approval of foreign currency payments by the PBOC or other regulatory institutions requires a payment application together with invoices and signed contracts. The value of RMB is subject to change in central government policies and international economic and political developments affecting supply and demand in the China Foreign Exchange Trading System market. When there is a significant change in value of RMB, the gains and losses resulting from translation of financial statements of a foreign subsidiary will be significant affected. As of March 31, 2020, RMB were depreciated from 6.71 RMB into US$1.00 at March 31, 2019 to 7.08 RMB into US$1.00 at March 31, 2020. 3) VIE risk The Company believes that the VIE Agreements and the Voting Agreement are in compliance with PRC law and are legally enforceable. However, uncertainties in the PRC legal system could limit the Company’s ability to enforce these contractual arrangements. The shareholders of Sichuan Senmiao are also shareholders of the Company and therefore have no current interest in seeking to act contrary to the contractual arrangements. However, if the shareholders of Sichuan Senmiao were to reduce their interest in the Company, their interests may diverge from that of the Company and that may potentially increase the risk that they would seek to act contrary to the contractual terms. However, the other shareholders of Jinkailong are not shareholders of the Company and there is a risk they may act in contrary to the interests of the shareholders of the Company. The Company cannot assure that when conflicts of interest arise, the shareholders of Sichuan Senmiao or the other shareholders of Jinkailong will act in the best interests of the Company or that conflicts of interests will be resolved in the Company’s favor. In addition, the Company’s ability to control Sichuan Senmiao and Jinkailong via the VIE Agreements and Voting Agreement may not be as effective as direct equity ownership. Further, the VIE Agreements or the Voting Agreement may not be enforced in China if the PRC government or courts consider those contracts contravene PRC laws and regulations or otherwise not enforceable for public policy reasons. If the VIE Agreements or the Voting Agreement were found to be in violation of any existing PRC laws and regulations, the PRC government could: · revoke the Company’s business and operating licenses; · require the Company to discontinue or restrict operations; · restrict the Company’s right to collect revenues; · block the Company’s websites; · require the Company to restructure the operations in such a way as to compel the Company to establish a new enterprise, re-apply for the necessary licenses or relocate our businesses, staff and assets; · impose additional conditions or requirements with which the Company may not be able to comply; or · take other regulatory or enforcement actions against the Company that could be harmful to the Company’s business. |
Recently issued accounting standards | (v) Recently issued accounting standards In October 2018, the FASB issued ASU 2018-17, Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest Entities. ASU 2018-17 eliminates the requirement that entities consider indirect interests held through related parties under common control in their entirety when assessing whether a decision-making fee is a variable interest. Instead, the reporting entity will consider such indirect interests on a proportionate basis. The amendments are effective for fiscal years ending after December 15, 2019. Early adoption is permitted. The adoption on April 1, 2019 did not have a material effect on the Company’s consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement - Disclosure Framework (Topic 820). The updated guidance improves the disclosure requirements on fair value measurements. The updated guidance if effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted for any removed or modified disclosures. The adoption on April 1, 2019 did not have a material effect on the Company’s consolidated financial statements. In June 2016, the FASB issued new accounting guidance ASU 2016-13 for recognition of credit losses on financial instruments, which is effective January 1, 2020, with early adoption permitted on January 1, 2019. The guidance introduces a new credit reserving model known as the Current Expected Credit Loss (“CECL”) model, which is based on expected losses, and differs significantly from the incurred loss approach used today. The CECL model requires measurement of expected credit losses not only based on historical experience and current conditions, but also by including reasonable and supportable forecasts incorporating forward-looking information and will likely result in earlier recognition of credit reserves. In November 2019, the FASB issued ASU No. 2019-10, which to update the effective date of ASU No. 2016-13 for private companies, not-for-profit organizations and certain smaller reporting companies applying for credit losses standard. The new effective date for these preparers is for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company has not early adopted this update and it will become effective on January 1, 2023 assuming the Company will remain eligible to be smaller reporting company. The Company is currently evaluating the impact of this new standard on Company’s consolidated financial statements and related disclosures. CECL adoption will have broad impact on the financial statements of financial services firms, which will affect key profitability and solvency measures. Some of the more notable expected changes include: - Higher allowance on financial guarantee reserve and finance lease receivable levels and related deferred tax assets. While different asset types will be impacted differently, the expectation is that reserve levels will generally increase across the board for all financial firms. - Increased reserve levels may lead to a reduction in capital levels. - As a result of higher reserving levels, the expectation is that CECL will reduce cyclicality in financial firms’ results, as higher reserving in “good times” will mean that less dramatic reserve increases will be loan related income (which will continue to be recognized on a periodic basis based on the effective interest method) and the related credit losses (which will be recognized up front at origination). This will make periods of loan expansion seem less profitable due to the immediate recognition of expected credit losses. Periods of stable or declining loan levels will look comparatively profitable as the income trickles in for loans, where losses had been previously recognized. In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes”. The amendments in this Update simplify the accounting for income taxes by removing certain exceptions to the general principles in Topic 740. The amendments also improve consistent application of and simplify GAAP for other areas of Topic 740 by clarifying and amending existing guidance. For public business entities, the amendments in this Update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2021, and interim periods within fiscal years beginning after December 15, 2022. Early adoption of the amendments is permitted, including adoption in any interim period for (1) public business entities for periods for which financial statements have not yet been issued and (2) all other entities for periods for which financial statements have not yet been made available for issuance. An entity that elects to early adopt the amendments in an interim period should reflect any adjustments as of the beginning of the annual period that includes that interim period. Additionally, an entity that elects early adoption must adopt all the amendments in the same period. The Company is currently evaluating the impact of this new standard on Company’s consolidated financial statements and related disclosures. The Company does not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on the consolidated financial position, statements of operations and cash flows of the Company. |
ORGANIZATION AND PRINCIPAL AC_2
ORGANIZATION AND PRINCIPAL ACTITIVIES (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
ORGANIZATION AND PRINCIPAL ACTITIVIES | |
Schedule of total assets and total liabilities VIEs | Total assets and total liabilities of the Company’s VIEs included in the Company’s consolidated financial statements as of March 31, 2020 and 2019 are as follows: March 31, March 31, 2020 2019 Total assets from continuing operations $ 8,639,858 $ 4,130,435 Total assets from discontinued operations (1) 1,418,080 1,083,579 Total assets $ 10,057,938 $ 5,214,014 Total liabilities from continuing operations $ 13,629,449 $ 6,456,098 Total liabilities from discontinued operations (2) 7,598,981 396,671 Total liabilities $ 21,228,430 $ 6,852,769 (1) Includes intercompany receivables of $543,446 and $613,730 as of March 31, 2020 and 2019, respectively. (2) Includes intercompany payables of $402,406 and $0 as of March 31, 2020 and 2019, respectively |
Schedule of net revenue, income (loss) from operations and net loss of the VIEs | Net revenue, loss from operations and net loss of the VIEs that were included in the Company’s consolidated financial statements for the years ended March 31, 2020 and 2019 are as follows: For the Years Ended March 31, 2020 2019 Net revenue from continuing operations $ 3,483,078 $ 1,087,207 Net revenue from discontinued operations $ 308,102 $ 369,956 Loss from operations from continuing operations $ (4,514,195) $ (152,804) Loss from operations from discontinued operations $ (822,470) $ (2,444,991) Net income (loss) from continuing operations attributable to stockholders (3,786,057) 63,702 Net loss from discontinued operations attributable to stockholders (4,692,725) (2,442,908) Net loss attributable to stockholders $ (8,478,782) $ (2,379,206) |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of translation of amounts from RMB into US$ | Translation of amounts from RMB into US$ has been made at the following exchange rates for the respective periods: March 31, March 31, 2020 2019 Balance sheet items, except for equity accounts 7.0824 6.7119 For the Years Ended March 31, 2020 2019 Items in the statements of operations and comprehensive loss, and statements of cash flows 6.9472 6.7008 |
Schedule of financial assets and liabilities that were accounted for at fair value on a recurring basis | The following table sets forth by level within the fair value hierarchy our financial assets and liabilities that were accounted for at fair value on a recurring basis as of March 31, 2020: Carrying Value at Fair Value Measurement at March 31, 2020 March 31, 2020 Level 1 Level 2 Level 3 Derivative liabilities $ 342,530 $ — $ — $ 342,530 |
Schedule of reconciliation of beginning and ending balance of the assets and liabilities measured at fair value on recurring basis | March 31, 2020 Beginning balance $ — Derivative liabilities recognized at grant date on June 20, 2019 3,150,006 Change in fair value of derivative liabilities (1,796,724) Fair value of Series B warrants exercised (1,010,752) Ending balance $ 342,530 |
Schedule of Fair Value Measurement Inputs and Valuation Techniques | The Company's Series A and Series B warrants and the placement agent warrants are not traded in an active securities market; therefore, the Company estimates the fair value to those warrants using the Black-Scholes valuation model on June 20, 2019 (the grant date) and March 31, 2020. June 20, 2019 Series A Series B Placement Agent Warrants Warrants Warrants # of shares exercisable 1,336,021 1,116,320 142,509 Valuation date 6/20/2019 6/20/2019 6/20/2019 Exercise price $ 3.72 $ 3.72 $ 3.38 Stock price $ 2.80 $ 2.80 $ 2.80 Expected term (year) 4.00 1.00 4.00 Risk-free interest rate 1.77 % 1.91 % 1.77 % Expected volatility 86 % 91 % 86 % March 31, 2020 Series A Series B Placement Agent Warrants Warrants Warrants # of shares exercisable 1,336,021 3,132 142,509 Valuation date 3/31/2020 3/31/2020 3/31/2020 Exercise price $ 1.50 $ 0.0001 $ 3.38 Stock price $ 0.44 $ 0.44 $ 0.44 Expected term (year) 3.22 0.22 3.22 Risk-free interest rate 0.30 % 0.11 % 0.30 % Expected volatility 122 % 127 % 122 % |
Schedule of finance lease receivables | As of March 31, 2020 and 2019, finance lease receivables consisted of the following: March 31, March 31, 2020 2019 Gross minimum lease payments receivable $ 1,606,230 $ 40,023 Less: Amounts representing estimated executory costs - - Minimum lease payments receivable 1,606,230 40,023 Less Allowance for uncollectible minimum lease payments receivable - - Net minimum lease payments receivable 1,606,230 40,023 Less: Unearned interest (412,975) (7,471) Financing lease receivables, net $ 1,193,255 $ 32,552 Finance lease receivables, net, current portion $ 459,110 $ 10,254 Finance lease receivables, net, noncurrent portion $ 734,145 $ 22,298 |
Schedule of future scheduled minimum lease payments for investments in sales-type leases | Future scheduled minimum lease payments for investments in sales-type leases as of March 31, 2020 are as follows: Minimum future payments receivable Year ending March 31, 2021 $ 607,718 Year ending March 31, 2022 570,944 Year ending March 31, 2023 341,389 Year ending March 31, 2024 86,179 Total $ 1,606,230 |
Schedule of property and equipment | The useful life of property and equipment is summarized as follows: Categories Useful life Leasehold improvements Shorter of the remaining lease terms or estimated useful lives Computer equipment 2 - 5 years Office equipment 3 - 5 years Automobiles 3 - 4 years |
Separately identifiable intangible assets that have determinable lives continue to be amortized over their estimated useful lives using the straight-line method | Purchased intangible assets are recognized and measured at fair value upon acquisition. Separately identifiable intangible assets that have determinable lives continue to be amortized over their estimated useful lives using the straight-line method as follows: Categories Useful life Platform 7 years Customer relationship 10 years Software 5-10 years |
Schedule of disaggregated information of revenues | For the Years Ended March 31, 2020 2019 Automobile Transaction and Related Services (Continuing Operations) - Revenues from sales of automobiles $ 11,536,691 $ 1,815,425 - Service fees from automobile purchase services 1,726,717 407,632 - Facilitation fees from automobile transactions 197,815 142,615 - Service fees from management and guarantee services 141,527 60,011 - Financing revenues 164,391 - - Operating lease revenues from automobile rentals 1,303,639 - - Other service fees 584,795 125,424 Total revenues from Automobile Transaction and Related Services (Continuing Operations) 15,655,575 2,551,107 Online Lending Services (Discontinued Operations) - Transaction fees 73,341 331,960 - Service fees 23,833 37,996 - Website development revenue 15,266 - Total revenues from Online Lending Services (Discontinued Operations) 112,440 369,956 Total revenues $ 15,768,015 $ 2,921,063 |
ACQUISITION OF HUNAN RUIXI AN_2
ACQUISITION OF HUNAN RUIXI AND ITS VIE (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
ACQUISITION OF HUNAN RUIXI AND ITS VIE | |
Schedule of fair value of assets and liabilities | The following table summarizes the fair values for major classes of assets acquired and liabilities assumed at the date of acquisition: Fair value Net assets acquired (i) $ 63,965 Gain from acquisition of Hunan Ruixi and its subsidiary and VIE - Noncontrolling interests (ii) - Total purchase consideration $ - (i) Net assets acquired primarily include cash and cash equivalents of $213,645, other current assets of $1,813,821, property and equipment of $107,865, other current liabilities of $711,303 and borrowings from related parties and affiliates of $785,231, and borrowings from financial institutions of $554,802. (ii) Fair value of the noncontrolling interests is estimated with reference to the purchase price per share as of the acquisition date. |
DISCONTIUED OPERATIONS (Tables)
DISCONTIUED OPERATIONS (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
DISCONTIUED OPERATIONS | |
Schedule of disposal Groups, Including Discontinued Operations | March 31, March 31, 2020 2019 Current Assets Cash and cash equivalents $ 10,139 $ 1,052,530 Accounts receivable, net — 126,272 Prepayments, other receivables and other assets, net 816,441 6,214 Total Current Assets 826,580 1,185,016 Property and equipment, net 11,206 25,205 Other Assets Intangible assets, net — 294,464 Prepayment for intangible assets — 190,706 Total Other Assets — 485,170 Total Assets $ 837,786 $ 1,695,391 March 31, March 31, 2020 2019 Current Liabilities Advance from customers $ — $ 7,220 Accrued expenses and other liabilities 4,204,012 538,512 Due to stockholders 182,095 1,080,047 Due to related parties and affiliates 76,286 — Lease liabilities 53,899 — Total Current Liabilities 4,516,292 1,625,779 Total liabilities $ 4,516,292 $ 1,625,779 For the Years Ended March 31, 2020 2019 Revenues $ 112,440 $ 369,956 Operating expenses Selling, general and administrative expenses (1,365,733) (2,242,905) Bad debt expense (4,048,210) — Amortization of intangible assets (32,401) (308,043) Impairments of intangible assets and goodwill (265,525) (1,225,073) Total operating expenses (5,711,869) (3,776,021) Loss from operations (5,599,429) (3,406,065) Other income, net 12,402 19,315 Loss before income taxes (5,587,027) (3,386,750) Income tax expenses — — Net loss attributable to stockholders $ (5,587,027) $ (3,386,750) |
ACCOUNTS RECEIVABLE, NET (Table
ACCOUNTS RECEIVABLE, NET (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
ACCOUNTS RECEIVABLE, NET | |
Schedule of accounts receivable | As of March 31, 2020 and 2019, accounts receivable were comprised of the following: March 31, March 31, 2020 2019 Receivables of transaction fees due from borrowers $ - $ 126,272 Receivables of automobile sales due from automobile purchasers 1,172,765 - Receivables of services fees due from automobile purchasers 854,730 199,909 Less: Unearned interest (105,083) - Less: Allowance for doubtful accounts (379,689) - Accounts receivable, net $ 1,542,723 $ 326,181 Accounts receivable, net, - discontinued operations - (126,272) Accounts receivable, net, - continuing operations $ 1,542,723 $ 199,909 Accounts receivable, net, current portion $ 660,645 $ 199,909 Accounts receivable, net, noncurrent portion $ 882,078 $ - |
Schedule of movement of allowance for doubtful accounts | Movement of allowance for doubtful accounts is as follows: March 31, March 31, 2020 2019 Beginning balance $ — $ — Addition 1,797,816 — Write off (1,410,736) Translation adjustment (7,391) — Ending balance $ 379,689 $ — |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
INVENTORIES | |
Schedule of inventories | March 31, March 31, 2020 2019 Automobiles (i) $ 1,000,675 $ 1,508,244 (i) As of March 31, 2020, the Company owned 70 automobiles with a total value of $850,533 for sale, and 11 automobiles with a total value of $150,142 for either leasing or sale. |
PREPAYMENTS, OTHER RECEIVABLE_2
PREPAYMENTS, OTHER RECEIVABLES AND OTHER ASSETS (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
PREPAYMENTS, OTHER RECEIVABLES AND OTHER ASSETS | |
Schedule of prepayments, receivables and other assets | As of March 31, 2020 and 2019, the prepayments, receivables and other assets were comprised of the following: March 31, March 31, 2020 2019 Receivables from borrowers of online lending platform, net (i) $ 811,504 $ - Due from automobile purchasers, net (ii) 1,385,352 2,564,834 Prepayments for automobiles (iii) 365,932 394,821 Deposits 489,638 294,986 Value added tax (“VAT”) recoverable 146,964 228,196 Deferred issuance costs - 149,696 Prepaid expenses 331,319 112,147 Employee advances 11,937 - Others 72,575 48,788 Total prepayments, receivables and other assets 3,615,221 3,793,468 Total prepayments, receivables and other assets - discontinued operations (816,441) (6,214) Total prepayments, receivables and other assets - continuing operations $ 2,798,780 $ 3,787,254 (i) Receivables from borrowers of online lending platform, net The balance of receivables from borrowers of online lending platform represented the outstanding loans the Company assumed from investors on the platform, which will be collected from related borrowers. As of March 31, 2020, the Company recorded allowance of $3,688,800 against doubtful receivables. (ii) Due from automobile purchasers, net The balance due from automobile purchasers represented the payment of automobiles and related insurances and taxes made on behalf of the automobile purchasers. The balance is expected to be collected from the automobile purchasers in installments. As of March 31, 2020 and 2019, the Company recorded allowance of $347,954 and $2,995, respectively, against doubtful receivables. During the year ended March 31, 2020, the Company wrote off balance due from automobile purchasers of $1,227,894. (iii) Prepayments for automobiles The balance represented amounts advanced to dealers for automobiles and to other third parties for automobiles related taxes and insurances. |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
PROPERTY AND EQUIPMENT, NET | |
Schedule of property and equipment | March 31, March 31, 2020 2019 Leasehold improvements $ 177,659 $ — Electronic devices 40,720 28,305 Office equipment, fixtures and furniture 79,271 48,157 Vehicles 320,949 81,523 Subtotal 618,599 157,985 Less: accumulated depreciation and amortization (138,192) (32,100) Total property and equipment, net 480,407 125,885 Total property and equipment, net - discontinued operations (11,206) (25,205) Total property and equipment, net - continuing operations $ 469,201 $ 100,680 |
INTANGIBLE ASSETS, NET (Tables)
INTANGIBLE ASSETS, NET (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
INTANGIBLE ASSETS, NET | |
Schedule of intangible assets | Intangible assets consisted of the following: March 31, March 31, 2020 2019 Customer relationship $ - $ 392,618 Platform 1,100,549 1,161,267 Software 815,315 27,205 Subtotal 1,915,864 1,581,090 Less: Accumulated amortization (1,138,243) (1,284,999) Total intangible assets, net 777,621 296,091 Total intangible assets, net - discontinued operations - (294,464) Total intangible assets, net - continuing operations $ 777,621 $ 1,627 |
Schedule of amortization expenses | The following table sets forth the Company’s amortization expense for the next five years ending: Amortization expenses Twelve months ending March 31, 2021 $ 158,243 Twelve months ending March 31, 2022 158,243 Twelve months ending March 31, 2023 158,243 Twelve months ending March 31, 2024 152,863 Thereafter 150,029 Total $ 777,621 |
BORROWINGS FROM THIRD PARTIES (
BORROWINGS FROM THIRD PARTIES (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
BORROWINGS FROM THIRD PARTIES | |
Schedule of borrowings from third parties | March 31, March 31, 2020 2019 Borrowings from third parties $ - $ 476,765 |
ACCRUED EXPENSES AND OTHER LI_2
ACCRUED EXPENSES AND OTHER LIABILITIES (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
ACCRUED EXPENSES AND OTHER LIABILITIES | |
Schedule of accrued expenses and other liabilities | March 31, March 31, 2020 2019 Payables to investors of online lending platform (i) $ 3,668,957 $ - Accrued payroll and welfare 890,912 614,765 Other payable (ii) 83,810 247,335 Loan repayments received on behalf of financial institutions (iii) 374,535 169,657 Payables for expenditures on automobile transaction and related services 373,026 157,382 Accrued expenses 104,264 198,456 Deposits 543,843 82,232 Other taxes payable 173,056 30,976 Total accrued expenses and other liabilities 6,212,403 1,500,803 Total accrued expenses and other liabilities - discontinued operations (4,204,012) (538,512) Total accrued expenses and other liabilities - continuing operations $ 2,008,391 $ 962,291 (i) (ii) The balance of other payable represented amount due to suppliers and vendors for operation purposes. (iii) The balance of loan repayments received on behalf of financial institutions represented the loan repayments made by the automobile purchasers to financial institutions through the Company, which has not been paid to the financial institutions. |
EQUITY (Tables)
EQUITY (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
EQUITY | |
Summary of allocation of net proceeds | Net proceeds were allocated as the follows: Warrants $ 3,150,006 Common stock 1,992,118 Total net proceeds $ 5,142,124 |
Summary of outstanding warrants | The Company has outstanding warrants as following: Weighted Average Average Remaining Warrants Warrants Exercise Contractual Outstanding Exercisable Price Life Balance, March 31, 2018 337,940 337,940 $ 4.80 4.96 Granted — — — — Forfeited — — — — Exercised (300,000) (300,000) $ 4.80 — Balance, March 31, 2019 37,940 37,940 $ 4.80 3.96 Granted 2,594,850 2,594,850 $ 3.70 4.00 Forfeited — — — — Exercised (1,113,188) (1,113,188) — — Balance, March 31, 2020 1,519,602 1,519,602 $ 1.76 3.21 |
Schedule of RSU activity | A summary of RSU activity for the year ended March 31, 2020 and 2019 is as follows: Weighted-Average Grant Number of Date Fair Shares Value Balance of RSUs outstanding at March 31, 2018 - $ - Grants of RSUs 25,000 $ 4.42 Vested RSUs (6,250) $ 4.42 Forfeited RSUs (7,500) $ 4.42 Balance of unvested RSUs at March 31, 2019 11,250 $ 4.42 Grants of RSUs 151,515 0.66 Vested RSUs (162,765) $ 0.92 Forfeited RSUs - - Balance of unvested RSUs at March 31, 2020 - $ - |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
Schedule of components of income tax expense | Income taxes in the PRC are consist of: For the Years Ended March 31, 2020 2019 Current income tax expenses $ 59,451 $ 21,905 Deferred income tax benefits (26,267) - Total income tax expenses $ 33,184 $ 21,905 |
Schedule of reconciliation of statutory tax rate to effective tax rate | Below is a reconciliation of the statutory tax rate to the effective tax rate: For the Years Ended March 31, 2020 2019 U.S. statutory tax rate 21.0 % 21.0 % Differential of PRC statutory tax rate 4.0 % 4.0 % Permanent difference of write-off of receivables from guarantee of loans (15.5) % - % Permanent difference of US (income) expenses not (taxable) deductible in PRC 3.4 % (24.1) % Valuation allowance on deferred income tax asset (13.1) % (2.4) % Others (0.6) % (0.4) % Effective tax rate (0.8) % (1.9) % |
Continuing Operations | |
Schedule of tax effects of temporary differences | The tax effects of temporary differences from continuing operations that give rise to the Company’s deferred tax assets are as follows: March 31, March 31, 2020 2019 Net operating loss carryforwards in the PRC $ 414,996 $ 30,693 Net operating loss carryforwards in the U.S. 527,365 272,258 Allowance for doubtful account 178,381 - Less: valuation allowance (1,120,742) (302,951) $ - $ - |
Discontinued operations | |
Schedule of tax effects of temporary differences | The tax effects of temporary differences from discontinued operations that give rise to the Company’s deferred tax assets are as follows: March 31, 2020 March 31, 2019 Net operating loss carryforwards in the PRC $ 2,206,673 $ 855,483 Less: valuation allowance (2,206,673) (855,483) $ — $ — |
RELATED PARTY TRANSACTIONS AN_2
RELATED PARTY TRANSACTIONS AND BALANCES (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
RELATED PARTY TRANSACTIONS AND BALANCES | |
Summary of amounts payable to stockholders, related parties and affiliates | This is comprised of amounts payable to two stockholders and are unsecured, interest free and due on demand. March 31, March 31, 2020 2019 Jun Wang $ 73,384 $ 107,233 Xiang Hu 108,711 972,814 Total due to stockholders $ 182,095 $ 1,080,047 Total due to stockholders – discontinued operations (182,095) (1,080,047) Total due to stockholders – continuing operations $ — $ — 3) Due to related parties and affiliates March 31, March 31, 2020 2019 Loan payable to related parties (i) $ 202,487 $ 95,781 Other payables due to related parties (ii) - 297,978 Others (iii) 26,478 22,172 Total due to related parties and affiliates 228,965 415,931 Total due to related parties and affiliates – discontinued operations (76,286) - Total due to related parties and affiliates – continuing operations $ 152,679 $ 415,931 (i) As of March 31, 2020 and 2019, the balances represented borrowings from three related parties, which is unsecured, interest free and due in the fiscal year of 2021. The balance as of March 31, 2019 bore an interest rate of 10% per annum and is due in the fiscal year of 2020. (ii) As of March 31, 2019, the balance represented borrowings from two related parties, who obtained borrowings from the online P2P lending platform of Sichuan Senmiao and then loaned the money to Jinkailong. The balance bore an interest rate of 8.22% per annum and was fully repaid in April 2019. (iii) |
LEASE (Tables)
LEASE (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
LEASE | |
Schedule of Operating and finance lease expenses | For the Years Ended Classification March 31, 2020 March 31, 2019 Operating lease cost Lease expenses Selling, general and administrative $ 378,499 $ 195,686 Finance lease cost Amortization of leased asset Cost of revenue 941,796 — Amortization of leased asset General and administrative 791,670 Interest on lease liabilities Interest expenses on finance leases 373,407 — Total lease expenses $ 2,485,372 $ 195,686 |
Schedule of minimum lease payments in future periods | Operating lease Finance lease payments payments Total Twelve months ending March 31, 2021 $ 371,437 $ 3,985,407 $ 4,356,844 Twelve months ending March 31, 2022 193,654 2,300,516 2,494,170 Twelve months ending March 31, 2023 124,195 457,690 581,885 Twelve months ending March 31, 2024 93,188 945 94,133 Twelve months ending March 31, 2025 25,223 — 25,223 Total lease payments 807,697 6,744,558 7,552,255 Less: discount (67,045) (694,497) (761,542) Present value of lease liabilities 740,652 6,050,061 6,790,713 Less: Present value of lease liabilities – discontinued operations (53,899) — (53,899) Present value of lease liabilities – continuing operations $ 686,753 $ 6,050,061 $ 6,736,814 |
PARENT-ONLY FINANCIALS (Tables)
PARENT-ONLY FINANCIALS (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
PARENT-ONLY FINANCIALS | |
Schedule of condensed balance sheets | SENMIAO TECHNOLOGY LIMITED CONDENSED BALANCE SHEETS March 31, March 31, 2020 2019 ASSETS Current Assets Cash and cash equivalents $ 2,590 $ 1,950,347 Due from subsidiaries 2,575,039 1,900,000 Prepayments, other receivables and other assets, net 92,375 208,327 Escrow receivable - 600,000 Total Current Assets 2,670,004 4,658,674 Other Assets Intangible assets 750,000 - Prepayment for intangible asset - 280,000 Investments in subsidiaries - 3,718,896 Total Assets $ 3,420,004 $ 8,657,570 LIABILITIES AND EQUITY Current Liabilities Accrued expenses and other liabilities $ 128,796 $ 282,172 Derivative liabilities 342,530 - Total Current Liabilities 471,326 282,172 Other Liabilities Excess of investments in subsidiaries 144,980 - Total Liabilities 616,306 282,172 Commitments and Contingencies Stockholders' Equity Common stock (par value $0.0001 per share, 100,000,000 shares authorized;29,008,818 and 25,945,255 shares issued and outstanding at March 31, 2020 and 2019, respectively) 2,901 2,595 Additional paid-in capital 27,013,137 23,833,112 Accumulated deficit (23,704,862) (15,031,538) Accumulated other comprehensive loss (507,478) (428,771) Total Senmiao Technology Limited Stockholders' Equity 2,803,698 8,375,398 Total Liabilities and Equity $ 3,420,004 $ 8,657,570 |
Schedule of condensed statement of operations | SENMIAO TECHNOLOGY LIMITED CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS For the Years Ended March 31, 2020 2019 General and administrative expenses $ (1,215,156) $ (1,098,416) Other Income, net 359 6,810 Change in fair value of derivative liabilities 1,796,724 - Equity of losses in subsidiaries (9,255,252) (3,458,263) Net loss (8,673,325) (4,549,869) Foreign currency translation adjustment (78,707) (175,010) Comprehensive loss attributable to stockholders $ (8,752,032) $ (4,724,879) |
Schedule of condensed statement of cash flows | SENMIAO TECHNOLOGY LIMITED CONDENSED STATEMENTS OF CASH FLOWS For the Years Ended March 31, 2020 2019 Cash Flows from Operating Activities: Net loss $ (8,673,325) $ (4,549,869) Adjustments to reconcile net loss to net cash used in operating activities: Equity of loss of subsidiaries 9,255,252 3,458,263 Stock compensation expense 133,150 44,200 Change in fair value of derivative liabilities (1,796,724) - Change in operating assets and liabilities Prepayments, receivables and other assets 115,952 (168,362) Accrued expenses and other liabilities (109,176) 84,890 Net Cash Used in Operating Activities (1,074,871) (1,130,878) Cash Flows from Investing Activities: Purchase of intangible assets (470,000) - Deposits in intangible assets - (280,000) Working capital contribution for subsidiaries (5,470,082) (6,300,000) Net Cash Used in Investing Activities (5,940,082) (6,580,000) Cash Flows from Financing Activities: Net proceeds from issuance of common stock in registered direct offering 5,142,124 - Net proceeds from issuance of common stock upon warrants exercised 111 - Proceeds borrowed from stockholders - 154 Repayment of borrowing to stockholders - (1,900,000) Borrowings to subsidiaries (675,039) - Release of escrow receivable 600,000 600,000 Net Cash Provided by (Used in) Financing Activities 5,067,196 (1,299,846) Net decrease in cash and cash equivalents (1,947,757) (9,010,724) Cash and cash equivalents, beginning of year 1,950,347 10,961,071 Cash and cash equivalents, end of year $ 2,590 $ 1,950,347 Supplemental Cash Flow Information Cash paid for interest expense $ - $ - Cash paid for income tax $ - $ - Non-cash Transaction in Investing and Financing Activities IPO expenses paid by the Company’s stockholders $ - $ 70,687 Prepayments in exchange of intangible assets $ 280,000 $ - Allocation of fair value of derivative liabilities for issuance of common stock proceeds $ 3,150,006 $ - Allocation of fair value of derivative liabilities to additional paid in capital upon warrants exercised $ 1,010,752 $ - Issuance of restricted stock units from accrued expenses and other liabilities $ 44,200 $ - |
ORGANIZATION AND PRINCIPAL AC_3
ORGANIZATION AND PRINCIPAL ACTITIVIES (Details) - USD ($) | Mar. 31, 2020 | Mar. 31, 2019 |
Total assets | $ 15,630,718 | $ 12,314,135 |
Total liabilities | 14,158,361 | 3,931,393 |
Variable Interest Entity, Primary Beneficiary [Member] | ||
Total assets | 10,057,938 | 5,214,014 |
Total liabilities | 21,228,430 | 6,852,769 |
Variable Interest Entity, Primary Beneficiary [Member] | Continuing Operations | ||
Total assets | 8,639,858 | 4,130,435 |
Total liabilities | 13,629,449 | 6,456,098 |
Variable Interest Entity, Primary Beneficiary [Member] | Discontinued operations | ||
Total assets | 1,418,080 | 1,083,579 |
Total liabilities | $ 7,598,981 | $ 396,671 |
ORGANIZATION AND PRINCIPAL AC_4
ORGANIZATION AND PRINCIPAL ACTITIVIES - Consolidated financial statements (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Net revenue | $ 15,655,575 | $ 2,551,107 |
Revenues | 15,768,015 | 2,921,063 |
Loss from operations | (5,596,938) | (1,042,847) |
Net income (loss) from continuing operations attributable to stockholders | (4,348,776) | (1,155,775) |
Net loss from discontinued operations attributable to stockholders | (5,587,027) | (3,386,750) |
Net loss attributable to stockholders | (8,673,325) | (4,549,869) |
Variable Interest Entity, Primary Beneficiary [Member] | ||
Net income (loss) from continuing operations attributable to stockholders | (3,786,057) | 63,702 |
Net loss from discontinued operations attributable to stockholders | (4,692,725) | (2,442,908) |
Net loss attributable to stockholders | (8,478,782) | (2,379,206) |
Variable Interest Entity, Primary Beneficiary [Member] | Continuing Operations | ||
Revenues | 3,483,078 | 1,087,207 |
Loss from operations | (4,514,195) | (152,804) |
Variable Interest Entity, Primary Beneficiary [Member] | Discontinued operations | ||
Net revenue | 308,102 | 369,956 |
Loss from operations | $ (822,470) | $ (2,444,991) |
ORGANIZATION AND PRINCIPAL AC_5
ORGANIZATION AND PRINCIPAL ACTITIVIES - Additional information (Details) | Mar. 18, 2020item | Jul. 05, 2019item | Feb. 29, 2020 | Aug. 31, 2019USD ($) | Aug. 31, 2018 | Mar. 31, 2020USD ($) | Mar. 31, 2019USD ($)shares | Jun. 30, 2019USD ($) | May 31, 2019USD ($) | Nov. 21, 2018USD ($) | Sep. 18, 2017shares |
Entity Incorporation, State Country Name | Nevada | ||||||||||
Entity Incorporation, Date of Incorporation | Jun. 8, 2017 | ||||||||||
Aggregate Consideration | $ 0 | ||||||||||
Amount receivables from assets on discontinued operations | 543,446 | $ 613,730 | |||||||||
Amount payables from liabilities on discontinued operations | $ 402,406 | $ 0 | |||||||||
Yicheng Financial Leasing Co [Member] | |||||||||||
Registered capital | $ 50,000,000 | ||||||||||
Voting Agreement with Jinkailongs other shareholders [Member] | |||||||||||
Equity Method Investment, Ownership Percentage | 35.00% | 65.00% | |||||||||
Business Agreement Term | 18 years | 20 years | |||||||||
Exclusive Option Agreement [Member] | |||||||||||
Contract period | 10 years | ||||||||||
Mashang Chuxing [Member] | |||||||||||
Number Of Shareholders Making Capital Contribution | item | 0 | 0 | |||||||||
Loss of operations | $ 4,400 | ||||||||||
Sichuan Senmiao [Member] | |||||||||||
Number of Aggregate Common Stock Shares Issued | shares | 20,250,000 | 45,000,000 | |||||||||
Business Agreement Term | 10 years | 10 years | |||||||||
Hunan Ruixi [Member] | |||||||||||
Equity Method Investment, Ownership Percentage | 60.00% | ||||||||||
Working Capital | $ 6,000,000 | ||||||||||
Contributions Towards Working Capital | $ 6,000,000 | ||||||||||
Registered Capital Percentage | 60.00% | ||||||||||
Jinkailong [Member] | |||||||||||
Equity Method Investment, Ownership Percentage | 35.00% | ||||||||||
Yicheng [Member] | |||||||||||
Equity Method Investment, Ownership Percentage | 49.00% | ||||||||||
Yunche Chixun [Member] | |||||||||||
Equity Method Investment, Ownership Percentage | 5.00% | ||||||||||
Mr. Zhiqiu Xia [Member] | |||||||||||
Equity Method Investment, Ownership Percentage | 46.00% |
GOING CONCERN (Details)
GOING CONCERN (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
GOING CONCERN | ||
Net loss from continuing operations | $ (4,348,776) | $ (1,155,775) |
Net loss from discontinued operations | (5,587,027) | (3,386,750) |
Accumulated deficit | (23,704,863) | (15,031,538) |
Negative working capital | 4,500,000 | |
Operating cash flows from continuing operations | (4,530,293) | (4,552,979) |
Operating cash flows from discontinued operations | $ (1,917,371) | $ (1,703,247) |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Foreign currency translation (Details) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Balance sheet items, except for equity accounts | 7.0824 | 6.7119 |
Items in the statements of operations and comprehensive loss, and statements of cash flows | 6.9472 | 6.7008 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Fair value on recurring basis (Details) - USD ($) | Mar. 31, 2020 | Mar. 31, 2019 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liabilities | $ 342,530 | $ 0 |
Carrying Value [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liabilities | 342,530 | |
Fair Value, Inputs, Level 1 [Member] | Fair Value [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liabilities | 0 | |
Fair Value, Inputs, Level 2 [Member] | Fair Value [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liabilities | 0 | |
Fair Value, Inputs, Level 3 [Member] | Fair Value [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liabilities | $ 342,530 |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Reconciliation of assets and liabilities (Details) | 12 Months Ended |
Mar. 31, 2020USD ($) | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Beginning balance | $ 0 |
Derivative liabilities recognized at grant date on June 20, 2019 | 3,150,006 |
Change in fair value of derivative liabilities | (1,796,724) |
Fair value of Series B warrants exercised | (1,010,752) |
Ending balance | $ 342,530 |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Fair value of warrants (Details) | Mar. 31, 2020Y$ / sharesshares | Jun. 21, 2019shares | Jun. 20, 2019Y$ / sharesshares | Dec. 20, 2019shares |
Class of Warrant or Right [Line Items] | ||||
Shares Offered During Period, New Issuance | shares | 1,781,361 | |||
Series A Warrants [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Shares Offered During Period, New Issuance | shares | 1,336,021 | 1,336,021 | ||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | shares | 1,336,021 | 3.72 | ||
Series B Warrants [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Shares Offered During Period, New Issuance | shares | 3,132 | 1,116,320 | ||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | shares | 1,116,320 | 1,116,320 | ||
Placement Agent Warrants [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Shares Offered During Period, New Issuance | shares | 142,509 | 142,509 | ||
Placement Agent Warrants [Member] | Maximum [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | shares | 142,509 | |||
Exercise price [Member] | Series A Warrants [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants and Rights Outstanding, Measurement Input | $ / shares | 1.50 | 3.72 | ||
Exercise price [Member] | Series B Warrants [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants and Rights Outstanding, Measurement Input | $ / shares | 0.0001 | 3.72 | ||
Exercise price [Member] | Placement Agent Warrants [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants and Rights Outstanding, Measurement Input | $ / shares | 3.38 | 3.38 | ||
Stock price [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants and Rights Outstanding, Measurement Input | $ / shares | 2.80 | |||
Stock price [Member] | Series A Warrants [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants and Rights Outstanding, Measurement Input | $ / shares | 0.44 | 2.80 | ||
Stock price [Member] | Series B Warrants [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants and Rights Outstanding, Measurement Input | $ / shares | 0.44 | 2.80 | ||
Stock price [Member] | Placement Agent Warrants [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants and Rights Outstanding, Measurement Input | $ / shares | 0.44 | 2.80 | ||
Expected term [Member] | Series A Warrants [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants and Rights Outstanding, Measurement Input | Y | 3.22 | 4 | ||
Expected term [Member] | Series B Warrants [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants and Rights Outstanding, Measurement Input | Y | 0.22 | 1 | ||
Expected term [Member] | Placement Agent Warrants [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants and Rights Outstanding, Measurement Input | Y | 3.22 | 4 | ||
Risk-free interest rate [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants and Rights Outstanding, Measurement Input | 1.77 | |||
Risk-free interest rate [Member] | Series A Warrants [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants and Rights Outstanding, Measurement Input | 0.30 | 1.77 | ||
Risk-free interest rate [Member] | Series B Warrants [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants and Rights Outstanding, Measurement Input | 0.11 | 1.91 | ||
Risk-free interest rate [Member] | Placement Agent Warrants [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants and Rights Outstanding, Measurement Input | 0.30 | 1.77 | ||
Expected volatility [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants and Rights Outstanding, Measurement Input | 86 | |||
Expected volatility [Member] | Series A Warrants [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants and Rights Outstanding, Measurement Input | 122 | 86 | ||
Expected volatility [Member] | Series B Warrants [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants and Rights Outstanding, Measurement Input | 127 | 91 | ||
Expected volatility [Member] | Placement Agent Warrants [Member] | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants and Rights Outstanding, Measurement Input | 122 | 86 |
SUMMARY OF SIGNIFICANT ACCOUN_8
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Finance lease receivables, net (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Capital Leases, Net Investment in Sales Type Leases [Abstract] | ||
Gross minimum lease payments receivable | $ 1,606,230 | $ 40,023 |
Less: Amounts representing estimated executory costs | 0 | 0 |
Minimum lease payments receivable | 1,606,230 | 40,023 |
Less Allowance for uncollectible minimum lease payments receivable | 0 | 0 |
Net minimum lease payments receivable | 1,606,230 | 40,023 |
Less: Unearned interest | 412,975 | 7,471 |
Financing lease receivables, net | 1,193,255 | 32,552 |
Finance lease receivables, net, current portion | 459,110 | 10,254 |
Finance lease receivables, net, noncurrent portion | 734,145 | 22,298 |
Sales-type and Direct Financing Leases, Lease Receivable, Fiscal Year Maturity [Abstract] | ||
Year ending March 31, 2021 | 607,718 | |
Year ending March 31, 2022 | 570,944 | |
Year ending March 31, 2023 | 341,389 | |
Year ending March 31, 2024 | 86,179 | |
Total | $ 1,606,230 | $ 40,023 |
SUMMARY OF SIGNIFICANT ACCOUN_9
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Property and equipment (Details) | 12 Months Ended |
Mar. 31, 2020 | |
Minimum [Member] | Computer Equipment [Member] | |
Useful Life | 2 years |
Minimum [Member] | Office Equipment [Member] | |
Useful Life | 3 years |
Minimum [Member] | Automobiles [Member] | |
Useful Life | 3 years |
Maximum [Member] | Computer Equipment [Member] | |
Useful Life | 5 years |
Maximum [Member] | Office Equipment [Member] | |
Useful Life | 5 years |
Maximum [Member] | Automobiles [Member] | |
Useful Life | 4 years |
SUMMARY OF SIGNIFICANT ACCOU_10
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Intangible assets (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Impairment of Intangible Assets, Finite-lived | $ 265,525 | $ 0 |
Platform [Member] | ||
Finite-Lived Intangible Asset, Useful Life | 7 years | |
Customer Relationship [Member] | ||
Finite-Lived Intangible Asset, Useful Life | 10 years | |
Software [Member] | Minimum [Member] | ||
Finite-Lived Intangible Asset, Useful Life | 5 years | |
Software [Member] | Maximum [Member] | ||
Finite-Lived Intangible Asset, Useful Life | 10 years |
SUMMARY OF SIGNIFICANT ACCOU_11
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Revenue (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Revenues by business lines | ||
Total revenues | $ 15,768,015 | $ 2,921,063 |
Continuing Operations | ||
Revenues by business lines | ||
Automobile Transaction and Related Services | 15,655,575 | 2,551,107 |
Discontinued operations | ||
Revenues by business lines | ||
Online Lending Services | 112,440 | 369,956 |
Revenues from Sales of Automobiles [Member] | Continuing Operations | ||
Revenues by business lines | ||
Automobile Transaction and Related Services | 11,536,691 | 1,815,425 |
Service fees from automobile purchase services [Member] | Continuing Operations | ||
Revenues by business lines | ||
Automobile Transaction and Related Services | 1,726,717 | 407,632 |
Facilitation fees from automobile transaction [Member] | Continuing Operations | ||
Revenues by business lines | ||
Automobile Transaction and Related Services | 197,815 | 142,615 |
Service fees from management and guarantee services [Member] | Continuing Operations | ||
Revenues by business lines | ||
Automobile Transaction and Related Services | 141,527 | 60,011 |
Financing revenues [Member] | Continuing Operations | ||
Revenues by business lines | ||
Automobile Transaction and Related Services | 164,391 | |
Operating lease revenues from automobile rentals [Member] | Continuing Operations | ||
Revenues by business lines | ||
Automobile Transaction and Related Services | 1,303,639 | |
Other service fees [Member] | Continuing Operations | ||
Revenues by business lines | ||
Automobile Transaction and Related Services | 584,795 | 125,424 |
Transaction fees [Member] | Discontinued operations | ||
Revenues by business lines | ||
Online Lending Services | 73,341 | 331,960 |
Service fees [Member] | Discontinued operations | ||
Revenues by business lines | ||
Online Lending Services | 23,833 | $ 37,996 |
Website Development Revenues from Online Lending Services [Member] | Discontinued operations | ||
Revenues by business lines | ||
Online Lending Services | $ 15,266 |
SUMMARY OF SIGNIFICANT ACCOU_12
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Additional information (Details) | 12 Months Ended | |||||
Mar. 31, 2020USD ($)segment | Mar. 31, 2019USD ($) | Mar. 31, 2020CNY (¥) | Mar. 31, 2020USD ($) | Oct. 17, 2019USD ($) | Apr. 01, 2019USD ($) | |
Accumulated Other Comprehensive Income (Loss), Net of Tax | $ (428,771) | $ (507,478) | ||||
Contract Receivable, Gross | 590,509 | |||||
Contract Receivable, Due in Next Twelve Months | 387,345 | |||||
Contract Receivable, Due in Year Two | 203,164 | |||||
Commitments and Contingencies | ||||||
Percentage of Income Taxes Benefit | 50.00% | |||||
Finite-Lived Intangible Assets, Net | 777,621 | |||||
Impairment of property and equipment | $ 0 | $ 0 | ||||
Number of reportable segment | segment | 2 | |||||
Number of operating segment | segment | 1 | |||||
Goodwill impairment loss on ROU | $ 70,984 | 0 | ||||
Allowance for doubtful accounts | 0 | 379,689 | ||||
Allowance for doubtful on finance lease receivables | 0 | 0 | ||||
Accounts Receivable, Net | 326,181 | 1,542,723 | $ 143,668 | |||
Net income (loss) | (8,673,325) | (4,549,869) | ||||
Accumulated deficit | (15,031,538) | (23,704,863) | ||||
Net cash used in operating cash flows | $ (6,447,664) | (6,256,226) | ||||
Percentage of remaining economic life of underlying asset | 75.00% | |||||
Percentage of economic life of underlying asset | 25.00% | |||||
Percentage of equal or exceeds lease payment | 90.00% | |||||
Company's pricing interest rate per annum | 6.00% | |||||
Operating Lease, Right-of-Use Asset | $ 0 | 473,661 | $ 246,227 | |||
Operating Lease, Liability | 740,652 | $ 247,325 | ||||
Lessee, Operating Lease, Liability, Undiscounted Excess Amount | $ 67,045 | |||||
Foreign Currency Exchange Rate, Remeasurement | 7.08 | 6.71 | 6.71 | |||
Cash deposits | $ 818,000 | $ 3,070,000 | ||||
Customer Concentration Risk [Member] | ||||||
Concentration Risk, Percentage | 95.00% | |||||
Automobiles [Member] | Minimum [Member] | ||||||
Useful Life | 3 years | |||||
Automobiles [Member] | Maximum [Member] | ||||||
Useful Life | 4 years | |||||
CHINA | ||||||
Cash, Uninsured Amount | 3,070,000 | $ 820,000 | ||||
Maximum Insurance Claim Deposit | ¥ 500,000 | 70,000 | ||||
UNITED STATES | ||||||
Deposits, Savings Deposits | $ 1,950,000 | 2,600 | ||||
Cash, FDIC Insured Amount | $ 250,000 |
ACQUISITION OF HUNAN RUIXI AN_3
ACQUISITION OF HUNAN RUIXI AND ITS VIE - Assets Acquired and Liabilities (Details) | 12 Months Ended | |
Mar. 31, 2020USD ($) | ||
ACQUISITION OF HUNAN RUIXI AND ITS VIE | ||
Net assets acquired | $ 63,965 | [1] |
Gain from acquisition of Hunan Ruixi and its subsidiary and VIE | 0 | |
Noncontrolling interests | 0 | [2] |
Total purchase consideration | $ 0 | |
[1] | Net assets acquired primarily include cash and cash equivalents of $213,645, other current assets of $1,813,821, property and equipment of $107,865, other current liabilities of $711,303 and borrowings from related parties and affiliates of $785,231, and borrowings from financial institutions of $554,802. | |
[2] | Fair value of the noncontrolling interests is estimated with reference to the purchase price per share as of the acquisition date. |
ACQUISITION OF HUNAN RUIXI AN_4
ACQUISITION OF HUNAN RUIXI AND ITS VIE - Additional information (Details) - USD ($) | Mar. 31, 2020 | Jun. 30, 2019 | Nov. 21, 2018 |
Cash and Cash Equivalents, Fair Value Disclosure | $ 213,645 | ||
Other Current Assets Fair value Disclosure | 1,813,821 | ||
Property, Plant, and Equipment, Fair Value Disclosure | 107,865 | ||
Other Current Liabilities Fair Value Disclosure | 711,303 | ||
Borrowings from related parties and affiliates | 785,231 | ||
Due To Financial Institutions | $ 554,802 | ||
Hunan Ruixi [Member] | |||
Equity Method Investment, Ownership Percentage | 60.00% | ||
Working Capital | $ 6,000,000 | ||
Registered Capital Percentage | 60.00% | ||
Contributions Towards Working Capital | $ 6,000,000 |
DISCONTIUED OPERATIONS (Details
DISCONTIUED OPERATIONS (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Other receivables | $ 3,688,800 | |
Discontinued operations, abandonment | Online Lending Business | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Accounts receivable, net | 0 | $ 126,272 |
Other receivables | 3,760,599 | |
Prepayments for impaired intangible assets | 143,943 | |
Provision for doubtful accounts | $ 4,048,210 |
DISCONTIUED OPERATIONS - Carryi
DISCONTIUED OPERATIONS - Carrying amounts of major classes of assets and liabilities (Details) - USD ($) | Mar. 31, 2020 | Mar. 31, 2019 |
Current Assets | ||
Total Current Assets | $ 826,580 | $ 1,185,016 |
Other Assets | ||
Total Other Assets | 0 | 485,170 |
Current Liabilities | ||
Total Current Liabilities | 4,516,292 | 1,625,779 |
Discontinued operations, abandonment | Online Lending Business | ||
Current Assets | ||
Cash and cash equivalents | 10,139 | 1,052,530 |
Accounts receivable, net | 0 | 126,272 |
Prepayments, other receivables and other assets, net | 816,441 | 6,214 |
Total Current Assets | 826,580 | 1,185,016 |
Property and equipment, net | 11,206 | 25,205 |
Other Assets | ||
Intangible assets, net | 0 | 294,464 |
Prepayment for intangible assets | 0 | 190,706 |
Total Other Assets | 0 | 485,170 |
Total Assets | 837,786 | 1,695,391 |
Current Liabilities | ||
Advance from customers | 7,220 | |
Accrued expenses and other liabilities | 4,204,012 | 538,512 |
Due to stockholders | 182,095 | 1,080,047 |
Due to related parties and affiliates | 76,286 | |
Lease liabilities | 53,899 | |
Total Current Liabilities | 4,516,292 | 1,625,779 |
Total liabilities | $ 4,516,292 | $ 1,625,779 |
DISCONTIUED OPERATIONS - Reconc
DISCONTIUED OPERATIONS - Reconciliation of major classes of income and losses (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Operating expenses | ||
Net loss attributable to stockholders | $ (5,587,027) | $ (3,386,750) |
Discontinued operations, abandonment | Online Lending Business | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Revenues | 112,440 | 369,956 |
Operating expenses | ||
Selling, general and administrative expenses | (1,365,733) | (2,242,905) |
Bad debt expense | (4,048,210) | |
Amortization of intangible assets | (32,401) | (308,043) |
Impairments of intangible assets and goodwill | (265,525) | (1,225,073) |
Total operating expenses | (5,711,869) | (3,776,021) |
Loss from operations | (5,599,429) | (3,406,065) |
Other income, net | 12,402 | 19,315 |
Loss before income taxes | (5,587,027) | (3,386,750) |
Net loss attributable to stockholders | $ (5,587,027) | $ (3,386,750) |
ACCOUNTS RECEIVABLE, NET (Detai
ACCOUNTS RECEIVABLE, NET (Details) - USD ($) | Mar. 31, 2020 | Oct. 17, 2019 | Mar. 31, 2019 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Less: Unearned interest | $ (105,083) | ||
Less: Allowance for doubtful accounts | (379,689) | $ 0 | |
Accounts receivable, net | 1,542,723 | $ 143,668 | 326,181 |
Accounts receivable, net, current portion | 660,645 | 199,909 | |
Accounts receivable, net, noncurrent portion | 882,078 | 0 | |
Continuing Operations | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Accounts receivable, net | 1,542,723 | 199,909 | |
Discontinued operations | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Accounts receivable, net | (126,272) | ||
Receivables of transaction fees due from borrowers | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Accounts receivable, gross | 126,272 | ||
Receivables of automobile sales due from automobile purchasers | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Accounts receivable, gross | 1,172,765 | ||
Receivables of services fees due from automobile purchasers | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Accounts receivable, gross | $ 854,730 | $ 199,909 |
ACCOUNTS RECEIVABLE, NET - Allo
ACCOUNTS RECEIVABLE, NET - Allowance for doubtful accounts (Details) | 12 Months Ended |
Mar. 31, 2020USD ($) | |
ACCOUNTS RECEIVABLE, NET | |
Beginning balance | $ 0 |
Addition | 1,797,816 |
Write off | (1,410,736) |
Translation adjustment | (7,391) |
Ending balance | $ 379,689 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) | Mar. 31, 2020 | Mar. 31, 2019 |
Public Utilities, Inventory [Line Items] | ||
Inventories | $ 1,000,675 | $ 1,508,244 |
Automobiles [Member] | ||
Public Utilities, Inventory [Line Items] | ||
Inventories | $ 1,000,675 | $ 1,508,244 |
INVENTORIES - Additional inform
INVENTORIES - Additional information (Details) | 12 Months Ended | |
Mar. 31, 2020USD ($)item | Mar. 31, 2019USD ($) | |
Public Utilities, Inventory [Line Items] | ||
Inventory Net Available For Sale | $ 850,533 | |
Inventory Net For Leasing Or Available For Sale | 150,142 | |
Inventory Write-down | $ 0 | $ 0 |
Seventy [Member] | ||
Public Utilities, Inventory [Line Items] | ||
Number Of Inventory Units | item | 70 | |
Eleven [Member] | ||
Public Utilities, Inventory [Line Items] | ||
Number Of Inventory Units | item | 11 |
PREPAYMENTS, OTER RECEIVABLES A
PREPAYMENTS, OTER RECEIVABLES AND OTHER ASSETS (Details) - USD ($) | Mar. 31, 2020 | Mar. 31, 2019 | |
Receivables from borrowers of online lending platform, net | [1] | $ 811,504 | $ 0 |
Due from automobile purchasers, net | [2] | 1,385,352 | 2,564,834 |
Prepayments for automobiles | 365,932 | 394,821 | |
Deposits | [3] | 489,638 | 294,986 |
Value added tax ("VAT") recoverable | 146,964 | 228,196 | |
Deferred issuance costs | 149,696 | ||
Prepaid expenses | 331,319 | 112,147 | |
Employee advances | 11,937 | ||
Others | 72,575 | 48,788 | |
Total property and equipment, net | 3,615,221 | 3,793,468 | |
Discontinued operations | |||
Total property and equipment, net | (816,441) | (6,214) | |
Continuing Operations | |||
Total property and equipment, net | $ 2,798,780 | $ 3,787,254 | |
[1] | Receivables from borrowers of online lending platform, net | ||
[2] | Due from automobile purchasers, net | ||
[3] | Prepayments for automobiles |
PREPAYMENTS, OTHER RECEIVABLE_3
PREPAYMENTS, OTHER RECEIVABLES AND OTHER ASSETS - Additional information (Details) - USD ($) | Mar. 31, 2020 | Mar. 31, 2019 |
PREPAYMENTS, OTHER RECEIVABLES AND OTHER ASSETS | ||
Allowance for doubtful receivables | $ 3,688,800 | |
Allowance for Doubtful Other Receivables, Current | $ 347,954 | $ 2,995 |
PROPERTY AND EQUIPMENT, NET (De
PROPERTY AND EQUIPMENT, NET (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Property and equipment | ||
Property, plant and equipment, Gross | $ 618,599 | $ 157,985 |
Less: accumulated depreciation and amortization | (138,192) | (32,100) |
Total Property and equipment, net | 480,407 | 125,885 |
Discontinued operations | ||
Property and equipment | ||
Total Property and equipment, net | (11,206) | (25,205) |
Depreciation and amortization expense | 10,846 | 10,604 |
Continuing Operations | ||
Property and equipment | ||
Total Property and equipment, net | 469,201 | 100,680 |
Depreciation and amortization expense | 103,009 | 12,247 |
Leasehold improvements | ||
Property and equipment | ||
Property, plant and equipment, Gross | 177,659 | |
Electronic devices | ||
Property and equipment | ||
Property, plant and equipment, Gross | 40,720 | 28,305 |
Office equipment, fixtures and furniture | ||
Property and equipment | ||
Property, plant and equipment, Gross | 79,271 | 48,157 |
Vehicles | ||
Property and equipment | ||
Property, plant and equipment, Gross | $ 320,949 | $ 81,523 |
INTANGIBLE ASSETS, NET (Details
INTANGIBLE ASSETS, NET (Details) - USD ($) | Mar. 31, 2020 | Mar. 31, 2019 |
Finite-Lived Intangible Assets, Gross | $ 1,915,864 | $ 1,581,090 |
Less: accumulated amortization | (1,138,243) | (1,284,999) |
Total intangible assets, net | 777,621 | 296,091 |
Discontinued operations | ||
Total intangible assets, net | (294,464) | |
Continuing Operations | ||
Total intangible assets, net | 777,621 | 1,627 |
Customer Relationship [Member] | ||
Finite-Lived Intangible Assets, Gross | 392,618 | |
Platform [Member] | ||
Finite-Lived Intangible Assets, Gross | 1,100,549 | 1,161,267 |
Software [Member] | ||
Finite-Lived Intangible Assets, Gross | $ 815,315 | $ 27,205 |
INTANGIBLE ASSETS, NET - Amorti
INTANGIBLE ASSETS, NET - Amortization expenses (Details) | Mar. 31, 2020USD ($) |
INTANGIBLE ASSETS, NET | |
Twelve months ending March 31, 2021 | $ 158,243 |
Twelve months ending March 31, 2022 | 158,243 |
Twelve months ending March 31, 2023 | 158,243 |
Twelve months ending March 31, 2024 | 152,863 |
Thereafter | 150,029 |
Total | $ 777,621 |
INTANGIBLE ASSETS, NET - Additi
INTANGIBLE ASSETS, NET - Additional information (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Indefinite-lived Intangible Assets [Line Items] | ||
Amortization of Intangible Assets | $ 283 | $ 0 |
Continuing Operations | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Amortization of Intangible Assets | 283 | 0 |
Discontinued operations | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Amortization of Intangible Assets | $ 32,401 | $ 308,043 |
PREPAYMENTS FOR INTANGIBLE AS_2
PREPAYMENTS FOR INTANGIBLE ASSETS (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Prepayments For Intangible Assets | $ 0 | $ 280,000 |
Write off of prepaid intangible assets | 143,943 | |
Automobile Transaction And Related Services | ||
Prepayments For Intangible Assets | $ 750,000 | 280,000 |
Online Lending Business | ||
Prepayments For Intangible Assets | $ 190,706 |
BORROWINGS FROM FINANCIAL INS_2
BORROWINGS FROM FINANCIAL INSTITUTIONS, CURRENT AND NONCURRENT (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Loans Payable to Bank, Noncurrent | $ 64,221 | $ 177,789 |
Interest Expense, Borrowings | 17,258 | 7,590 |
Financial Institutions Borrower [Member] | ||
Loans Payable to Bank | 290,974 | 396,946 |
Loans Payable to Bank, Noncurrent | 64,221 | 177,789 |
Interest Expense, Borrowings | $ 49,422 | $ 12,799 |
Minimum [Member] | Financial Institutions Borrower [Member] | ||
Debt Instrument, Interest Rate, Stated Percentage | 6.20% | |
Minimum [Member] | Credit line with Bank of Changsha | ||
Long-term Debt, Term | 13 months | |
Maximum [Member] | Financial Institutions Borrower [Member] | ||
Debt Instrument, Interest Rate, Stated Percentage | 8.10% | |
Maximum [Member] | Credit line with Bank of Changsha | ||
Long-term Debt, Term | 24 months |
BORROWINGS FROM THIRD PARTIES_2
BORROWINGS FROM THIRD PARTIES (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
BORROWINGS FROM THIRD PARTIES | ||
Borrowings from third parties | $ 0 | $ 476,765 |
Interest expense | $ 17,258 | $ 7,590 |
BORROWINGS FROM THIRD PARTIES -
BORROWINGS FROM THIRD PARTIES - Additional information (Details) | 12 Months Ended |
Mar. 31, 2020USD ($) | |
BORROWINGS FROM THIRD PARTIES | |
Interest Expense, Debt | $ 17,258 |
ACCRUED EXPENSES AND OTHER LI_3
ACCRUED EXPENSES AND OTHER LIABILITIES (Details) - USD ($) | Mar. 31, 2020 | Mar. 31, 2019 | |
Payables to investors of online lending platform (i) | [1] | $ 3,668,957 | |
Accrued payroll and welfare | 890,912 | $ 614,765 | |
Other payable | [2] | 83,810 | 247,335 |
Loan repayments received on behalf of financial institutions (iii) | [3] | 374,535 | 169,657 |
Payables for expenditures on automobile transaction and related services | 373,026 | 157,382 | |
Accrued expenses | 104,264 | 198,456 | |
Deposits | 543,843 | 82,232 | |
Other tax payable | 173,056 | 30,976 | |
Total accrued expenses and other liabilities | 6,212,403 | 1,500,803 | |
Continuing Operations | |||
Total accrued expenses and other liabilities | 4,204,012 | 538,512 | |
Discontinued operations | |||
Total accrued expenses and other liabilities | $ 2,008,391 | $ 962,291 | |
[1] | The balance of payables to investors of online lending platform represented the outstanding loans from investors on the platform, which was assumed by the Company in connection with the Plan to discontinue its online lending services business. | ||
[2] | The balance of other payable represented amount due to suppliers and vendors for operation purposes. | ||
[3] | The balance of loan repayments received on behalf of financial institutions represented the loan repayments made by the automobile purchasers to financial institutions through the Company, which has not been paid to the financial institutions. |
EMPLOYEE BENEFIT PLAN (Details)
EMPLOYEE BENEFIT PLAN (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Continuing Operations | ||
Defined Contribution Plan, Cost | $ 204,245 | $ 22,258 |
Defined Benefit Plan, Benefit Obligation | 170,856 | 65,826 |
Discontinued operations | ||
Defined Contribution Plan, Cost | 158,523 | 84,043 |
Defined Benefit Plan, Benefit Obligation | $ 454,151 | $ 337,820 |
EQUITY - IPO Warrants (Details)
EQUITY - IPO Warrants (Details) - shares | 1 Months Ended | 12 Months Ended | |
Apr. 05, 2019 | Mar. 31, 2020 | Mar. 15, 2019 | |
Class of Warrant or Right [Line Items] | |||
Stock Issued During Period Upon Exercise Of Warrants | 65,855 | ||
Common stock [Member] | |||
Class of Warrant or Right [Line Items] | |||
Class of Warrant or Right, Number of Securities Called by Each Warrant or Right | 337,940 | ||
Class Of Warrant Or Rights Term And Price Description | Each five-year warrant entitles warrant holder to purchase one share of the Company's common stock at the price of $4.80 per share and is not exercisable for a period of 180 days from March 16, 2018. | ||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 300,000 | ||
Warrant [Member] | |||
Class of Warrant or Right [Line Items] | |||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 300,000 | ||
Class of Warrant or Right, Outstanding | 37,940 |
EQUITY - Registered Direct Offe
EQUITY - Registered Direct Offering Warrants (Details) | Jun. 21, 2019USD ($) | Jun. 21, 2019USD ($) | Mar. 31, 2020USD ($)Y$ / shares | Mar. 31, 2019USD ($) | Jun. 20, 2019Y$ / shares |
Class of Warrant or Right [Line Items] | |||||
Warrants | $ 3,150,006 | ||||
Common stock | $ 6,000,000 | $ 6,000,000 | 1,992,118 | ||
Total net proceeds | 5,142,124 | $ 0 | |||
Fair Value Adjustment of Warrants | 1,796,724 | ||||
Fair value of warrants exercised | (1,010,752) | ||||
Warrants and Rights Outstanding | 342,530 | $ 0 | |||
Series B Warrants [Member] | |||||
Class of Warrant or Right [Line Items] | |||||
Common stock | $ 111 | ||||
Expected volatility [Member] | |||||
Class of Warrant or Right [Line Items] | |||||
Warrants and Rights Outstanding, Measurement Input | 86 | ||||
Expected volatility [Member] | Placement Agent Warrants [Member] | |||||
Class of Warrant or Right [Line Items] | |||||
Warrants and Rights Outstanding, Measurement Input | 122 | 86 | |||
Expected volatility [Member] | Series A Warrants [Member] | |||||
Class of Warrant or Right [Line Items] | |||||
Warrants and Rights Outstanding, Measurement Input | 122 | 86 | |||
Expected volatility [Member] | Series B Warrants [Member] | |||||
Class of Warrant or Right [Line Items] | |||||
Warrants and Rights Outstanding, Measurement Input | 127 | 91 | |||
Risk-free interest rate [Member] | |||||
Class of Warrant or Right [Line Items] | |||||
Warrants and Rights Outstanding, Measurement Input | 1.77 | ||||
Risk-free interest rate [Member] | Placement Agent Warrants [Member] | |||||
Class of Warrant or Right [Line Items] | |||||
Warrants and Rights Outstanding, Measurement Input | 0.30 | 1.77 | |||
Risk-free interest rate [Member] | Series A Warrants [Member] | |||||
Class of Warrant or Right [Line Items] | |||||
Warrants and Rights Outstanding, Measurement Input | 0.30 | 1.77 | |||
Risk-free interest rate [Member] | Series B Warrants [Member] | |||||
Class of Warrant or Right [Line Items] | |||||
Warrants and Rights Outstanding, Measurement Input | 0.11 | 1.91 | |||
Measurement Input, Expected Dividend Rate [Member] | |||||
Class of Warrant or Right [Line Items] | |||||
Warrants and Rights Outstanding, Measurement Input | 0 | ||||
Expected term [Member] | Placement Agent Warrants [Member] | |||||
Class of Warrant or Right [Line Items] | |||||
Warrants and Rights Outstanding, Measurement Input | Y | 3.22 | 4 | |||
Warrants and Rights Outstanding, Term | 4 years | ||||
Expected term [Member] | Series A Warrants [Member] | |||||
Class of Warrant or Right [Line Items] | |||||
Warrants and Rights Outstanding, Measurement Input | Y | 3.22 | 4 | |||
Warrants and Rights Outstanding, Term | 4 years | ||||
Expected term [Member] | Series B Warrants [Member] | |||||
Class of Warrant or Right [Line Items] | |||||
Warrants and Rights Outstanding, Measurement Input | Y | 0.22 | 1 | |||
Warrants and Rights Outstanding, Term | 1 year | ||||
Stock price [Member] | |||||
Class of Warrant or Right [Line Items] | |||||
Warrants and Rights Outstanding, Measurement Input | $ / shares | 2.80 | ||||
Stock price [Member] | Placement Agent Warrants [Member] | |||||
Class of Warrant or Right [Line Items] | |||||
Warrants and Rights Outstanding, Measurement Input | $ / shares | 0.44 | 2.80 | |||
Stock price [Member] | Series A Warrants [Member] | |||||
Class of Warrant or Right [Line Items] | |||||
Warrants and Rights Outstanding, Measurement Input | $ / shares | 0.44 | 2.80 | |||
Stock price [Member] | Series B Warrants [Member] | |||||
Class of Warrant or Right [Line Items] | |||||
Warrants and Rights Outstanding, Measurement Input | $ / shares | 0.44 | 2.80 |
EQUITY - Outstanding warrants (
EQUITY - Outstanding warrants (Details) - Warrant [Member] - $ / shares | 12 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | |
Warrants Outstanding | |||
Balance at the beginning | 37,940 | 337,940 | |
Granted | 2,594,850 | ||
Exercised | (1,113,188) | (300,000) | |
Balance at the end | 1,519,602 | 37,940 | 337,940 |
Warrants Exercisable | |||
Balance at the beginning | 37,940 | 337,940 | |
Granted | 2,594,850 | ||
Exercised | (1,113,188) | (300,000) | |
Balance at the end | 1,519,602 | 37,940 | 337,940 |
Weighted Average Exercise Price | |||
Balance at the beginning | $ 4.80 | $ 4.80 | |
Granted | 3.70 | ||
Exercised | 4.80 | ||
Balance at the end | $ 1.76 | $ 4.80 | $ 4.80 |
Granted | 4 years | ||
Average remaining contractual life | 3 years 2 months 16 days | 3 years 11 months 16 days | 4 years 11 months 16 days |
EQUITY - Restricted Stock Units
EQUITY - Restricted Stock Units (Details) - $ / shares | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Number of Shares | ||
Balance of RSUs outstanding | 11,250 | 0 |
Grants of RSUs | 151,515 | 25,000 |
Vested RSUs | (162,765) | (6,250) |
Forfeited RSUs | (7,500) | |
Balance of unvested RSUs | 11,250 | |
Weighted-Average Grant Date Fair Value | ||
Balance of RSUs outstanding | $ 4.42 | $ 0 |
Grants of RSUs | 0.66 | 4.42 |
Vested RSUs | $ 0.92 | 4.42 |
Forfeited RSUs | 4.42 | |
Balance of unvested RSUs | $ 4.42 |
EQUITY - Restricted Stock Uni_2
EQUITY - Restricted Stock Units - Additional information (Details) - USD ($) | Dec. 11, 2019 | Dec. 11, 2018 | Jul. 31, 2018 | Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 |
Stock Issued During Period, Shares, Restricted Stock Award, Gross | 25,000 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 151,515 | 25,000 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Fair Value | $ 117,750 | |||||
Share-based Compensation | $ 133,150 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeited in Period | 7,500 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number | 11,250 | 0 | ||||
Restricted Stock [Member] | ||||||
Share-based Compensation | $ 44,200 | |||||
Restricted stock units | ||||||
Stock Issued During Period, Shares, Restricted Stock Award, Gross | 30,303 | 30,303 | 5,000 | 169,015 | 6,250 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 25,000 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeited in Period | 7,500 |
EQUITY - Registered Direct Of_2
EQUITY - Registered Direct Offering (Details) | Dec. 20, 2019director$ / sharesshares | Dec. 11, 2019shares | Jun. 21, 2019USD ($)$ / sharesshares | Dec. 11, 2018shares | Jun. 21, 2019USD ($)$ / sharesshares | Jul. 31, 2018shares | Mar. 31, 2020USD ($)$ / sharesshares | Mar. 31, 2019shares | Aug. 12, 2019$ / shares | Jun. 20, 2019$ / shares | Apr. 15, 2019USD ($) | Mar. 15, 2019shares |
Class of Warrant or Right [Line Items] | ||||||||||||
Sale Of Aggregate Principal Amount Of Our Equity | $ | $ 80,000,000 | |||||||||||
Shares Issued, Price Per Share | $ / shares | $ 3.38 | $ 3.38 | ||||||||||
Proceeds from Issuance of Common Stock | $ | $ 6,000,000 | $ 6,000,000 | $ 1,992,118 | |||||||||
Stock Issued During Period, Shares, New Issues | 1,781,361 | 5,000 | ||||||||||
Restricted stock units approved for issuance | 25,000 | |||||||||||
RSUs vested | 162,765 | 6,250 | ||||||||||
Maximum adjustment price | $ / shares | $ 1.50 | |||||||||||
Quotient Percentage | 100.00% | |||||||||||
Number of lowest volume weighted average price | director | 5 | |||||||||||
Consecutive trading day period ending and including the Six Month Measuring Date to calculate VWAP | 10 days | |||||||||||
Fairvalue of Warrants and rights outstanding warrants exercised | $ | $ 1,010,752 | |||||||||||
Restricted stock units | ||||||||||||
Class of Warrant or Right [Line Items] | ||||||||||||
Restricted stock units approved for issuance | 30,303 | 30,303 | 5,000 | 169,015 | 6,250 | |||||||
Series A Warrants [Member] | ||||||||||||
Class of Warrant or Right [Line Items] | ||||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 3.72 | 1,336,021 | 1,336,021 | |||||||||
Exercise price of warrants | $ / shares | $ 3.72 | $ 1.50 | $ 3.72 | |||||||||
Series B Warrants [Member] | ||||||||||||
Class of Warrant or Right [Line Items] | ||||||||||||
Proceeds from Issuance of Common Stock | $ | $ 111 | |||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 1,116,320 | 1,116,320 | 1,116,320 | |||||||||
Exercise price of warrants | $ / shares | $ 0.0001 | $ 3.72 | ||||||||||
Common stock [Member] | ||||||||||||
Class of Warrant or Right [Line Items] | ||||||||||||
Stock Issued During Period, Shares, New Issues | 1,781,360 | |||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 300,000 | |||||||||||
Common stock [Member] | Series A Warrants [Member] | ||||||||||||
Class of Warrant or Right [Line Items] | ||||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 1,336,021 | 1,336,021 | ||||||||||
Common stock [Member] | Series B Warrants [Member] | ||||||||||||
Class of Warrant or Right [Line Items] | ||||||||||||
Stock Issued During Period, Shares, New Issues | 1,113,187 | |||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 1,116,320 | 1,116,320 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
INCOME TAXES | ||
Current income tax (benefits) expenses | $ 59,451 | $ 21,905 |
Deferred income tax expenses | (26,267) | 0 |
Total income tax (benefits) expenses | $ 33,184 | $ 21,905 |
INCOME TAXES - Deferred Tax Ass
INCOME TAXES - Deferred Tax Assets (Details) - USD ($) | Mar. 31, 2020 | Mar. 31, 2019 |
Net operating loss carryforwards in the PRC | $ 414,996 | $ 30,693 |
Net operating loss carryforwards in the U.S. | 527,365 | 272,258 |
Allowance for doubtful accounts | 178,381 | 0 |
Less: valuation allowance | (1,120,742) | (302,951) |
Deferred Tax Assets Net | 0 | 0 |
Discontinued operations | ||
Net operating loss carryforwards in the PRC | 2,206,673 | 855,483 |
Less: valuation allowance | $ (2,206,673) | $ (855,483) |
INCOME TAXES - Additional infor
INCOME TAXES - Additional information (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Operating Loss Carryforwards | $ 1,700,000 | $ 153,000 |
Operating Loss Carryforwards Expiration Year | 2023 | |
Deferred Tax Assets, Operating Loss Carryforwards | $ 2,500,000 | |
Net Operating Loss Included In Operating Loss Carryforwards | $ 1,200,000 | |
Deferred Tax Assets, Valuation Allowance, Percentage | 100.00% | |
Deferred tax assets utilized | $ 27,000 | |
Valuation allowances for deferred tax assets | 530,000 | 270,000 |
Discontinued operations | ||
Operating Loss Carryforwards | $ 8,800,000 | $ 3,400,000 |
State Administration of Taxation, China [Member] | ||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 25.00% |
INCOME TAXES - Reconciliation o
INCOME TAXES - Reconciliation of Statutory Tax Rate to Effective Tax Rate (Details) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Valuation allowance on deferred income tax asset | (13.10%) | (2.40%) |
Effective Income Tax Rate Reconciliation, Other Adjustments, Percent | (0.60%) | (0.40%) |
CHINA | ||
PRC statutory tax rate | 21.00% | 21.00% |
Tax rate difference in other jurisdiction | 4.00% | 4.00% |
Non-deductible expenses | (15.50%) | |
Non-deductible impairments for intangibles and goodwill | 3.40% | (24.10%) |
Effective Income Tax Rate Reconciliation, Percent | (0.80%) | (1.90%) |
RELATED PARTY TRANSACTIONS AN_3
RELATED PARTY TRANSACTIONS AND BALANCES - Amount due to related parties and affiliates (Details) - USD ($) | Mar. 31, 2020 | Mar. 31, 2019 | |
Total due to stockholders | $ 182,095 | $ 1,080,047 | |
Loan payable to related parties (i) | [1] | 202,487 | 95,781 |
Other payables due to related parties (ii) | 297,978 | ||
Others (iii) | 26,478 | 22,172 | |
Total due to related parties and affiliates | 228,965 | 415,931 | |
Jun Wang [Member] | |||
Total due to stockholders | 73,384 | 107,233 | |
Xiang Hu [Member] | |||
Total due to stockholders | 108,711 | 972,814 | |
Continuing Operations | |||
Total due to related parties and affiliates | 152,679 | 415,931 | |
Discontinued operations | |||
Total due to stockholders | (182,095) | (1,080,047) | |
Total due to related parties and affiliates | $ (76,286) | $ 0 | |
[1] | As of March 31, 2020 and 2019, the balances represented borrowings from three related parties, which is unsecured, interest free and due in the fiscal year of 2021. The balance as of March 31, 2019 bore an interest rate of 10% per annum and is due in the fiscal year of 2020. |
RELATED PARTY TRANSACTIONS AN_4
RELATED PARTY TRANSACTIONS AND BALANCES - Additional information (Details) - USD ($) | Nov. 01, 2018 | Dec. 31, 2017 | Mar. 31, 2020 | Mar. 31, 2019 | Apr. 01, 2019 |
Related Party Transaction, Due from (to) Related Party | $ 12,341 | ||||
Interest expense on related party transaction | 29,944 | $ 3,246 | |||
Proceeds from Related Party Debt | 1,305,166 | 471,608 | |||
Repayments of Related Party Debt | 1,405,356 | 487,115 | |||
Due to Officers or Stockholders | 182,095 | 1,080,047 | |||
Operating lease right-of-use assets, net | $ 473,661 | 0 | $ 246,227 | ||
Lessee Operating Lease Contract Period Description | November 1, 2018 to October 31, 2023 | ||||
Other payables due to related parties | 297,978 | ||||
Advances to non-controlling shareholders | $ 14,120 | ||||
Operating Lease Liability current From Discontinuing Operations | 53,899 | ||||
Operating Lease, Liability, Current | 149,582 | 0 | |||
Operating Lease, Liability, Noncurrent | $ 297,167 | 0 | |||
Jinkailong | Maximum [Member] | |||||
Debt Instrument, Interest Rate, Stated Percentage | 8.22% | ||||
Jinkailong | Minimum [Member] | |||||
Debt Instrument, Interest Rate, Stated Percentage | 7.68% | ||||
Sichuan Qihuaxin Automobiles [Member] | |||||
Maintenance Fees To Affiliates | $ 36,088 | ||||
Sichuan Yousen Automobiles Maintenance Sevices Ltd [Member] | |||||
Maintenance Fees To Affiliates | 21,759 | ||||
Xiang Hu [Member] | |||||
Proceeds from Related Party Debt | $ 955,000 | ||||
Due to Officers or Stockholders | 108,711 | ||||
Jun Wang [Member] | |||||
Proceeds from Related Party Debt | $ 159,000 | ||||
Due to Officers or Stockholders | $ 73,384 | ||||
Shareholders [Member] | |||||
Debt Instrument, Interest Rate, Stated Percentage | 10.00% | ||||
Operating Leases, Rent Expense, Net | $ 109,896 | 113,742 | |||
Hunan Dingchentai Investment Co [Member] | |||||
Operating Leases, Rent Expense, Net | 41,661 | $ 13,597 | |||
Operating Leases Annual Rental Payments | $ 44,250 | ||||
Operating Lease, Liability, Current | 73,173 | ||||
Operating Lease, Liability, Noncurrent | 88,349 | ||||
Sichuan Senmiao [Member] | |||||
Debt Instrument, Interest Rate, Stated Percentage | 8.22% | ||||
Repayments of Related Party Debt | 297,978 | ||||
Related Party Debt Face Amount Borrowed | 747,647 | ||||
Sichuan Senmiao [Member] | Jinkailong | |||||
Interest Expense, Related Party | 12,184 | $ 0 | |||
Continuing Operations | |||||
Operating lease right-of-use assets, net | 105,432 | ||||
Operating Leases, Rent Expense | 294,127 | 67,662 | |||
Operating Lease, Liability, Current | 78,482 | ||||
Continuing Operations | Hunan Dingchentai Investment Co [Member] | |||||
Operating lease right-of-use assets, net | 130,873 | ||||
Discontinued operations | |||||
Due to Officers or Stockholders | (182,095) | (1,080,047) | |||
Operating Leases, Rent Expense | 84,372 | $ 128,024 | |||
Operating Lease, Liability, Current | $ 53,899 |
RELATED PARTY TRANSACTIONS AN_5
RELATED PARTY TRANSACTIONS AND BALANCES - Detailed Information on Transactions and Related Parties (Details) - USD ($) | Mar. 31, 2020 | Mar. 31, 2019 | |
RELATED PARTY TRANSACTIONS AND BALANCES | |||
Outstanding balance | [1] | $ 202,487 | $ 95,781 |
[1] | As of March 31, 2020 and 2019, the balances represented borrowings from three related parties, which is unsecured, interest free and due in the fiscal year of 2021. The balance as of March 31, 2019 bore an interest rate of 10% per annum and is due in the fiscal year of 2020. |
LEASE - Lease expense (Details)
LEASE - Lease expense (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Finance lease cost | ||
Amortization of leased asset | $ 1,553,523 | $ 0 |
Interest on lease liabilities | 373,407 | 0 |
Total lease expenses | 2,485,372 | 195,686 |
Selling, general and administrative | ||
Operating lease cost | ||
Lease expenses | 378,499 | $ 195,686 |
Cost of revenue | ||
Finance lease cost | ||
Amortization of leased asset | 941,796 | |
General and administrative | ||
Finance lease cost | ||
Amortization of leased asset | 791,670 | |
Interest expenses on finance leases | ||
Finance lease cost | ||
Interest on lease liabilities | $ 373,407 |
LEASE - Lease obligations in fu
LEASE - Lease obligations in future periods (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Apr. 01, 2019 | |
Operating lease | ||
Twelve months ending March 31, 2021 | $ 371,437 | |
Twelve months ending March 31, 2022 | 193,654 | |
Twelve months ending March 31, 2023 | 124,195 | |
Twelve months ending March 31, 2024 | 93,188 | |
Twelve months ending March 31, 2025 | 25,223 | |
Total lease payments | 807,697 | |
Less: discount | (67,045) | |
Present value of lease liabilities | 740,652 | $ 247,325 |
Finance lease | ||
Twelve months ending March 31, 2021 | 3,985,407 | |
Twelve months ending March 31, 2022 | 2,300,516 | |
Twelve months ending March 31, 2023 | 457,690 | |
Twelve months ending March 31, 2024 | 945 | |
Total lease payments | 6,744,558 | |
Less: discount | (694,497) | |
Present value of lease liabilities | 6,050,061 | |
Lease payments | ||
Twelve months ending March 31, 2021 | 4,356,844 | |
2022 | 2,494,170 | |
2023 | 581,885 | |
2024 | 94,133 | |
2025 | 25,223 | |
Total lease payments | 7,552,255 | |
Less: discount | (761,542) | |
Present value of lease liabilities | 6,790,713 | |
Continuing Operations | ||
Operating lease | ||
Present value of lease liabilities | 686,753 | |
Finance lease | ||
Present value of lease liabilities | 6,050,061 | |
Lease payments | ||
Present value of lease liabilities | 6,736,814 | |
Discontinued operations | ||
Operating lease | ||
Present value of lease liabilities | (53,899) | |
Lease payments | ||
Present value of lease liabilities | $ (53,899) |
LEASE - Additional Information
LEASE - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Apr. 01, 2019 | |
Operating Lease, Right-of-Use Asset | $ 473,661 | $ 0 | $ 246,227 |
Operating Lease, Liability | 740,652 | $ 247,325 | |
Operating Lease, Weighted Average Discount Rate, Percent | 6.00% | ||
Remaining operating lease term | 2 years 1 month 6 days | ||
Remaining finance lease term | 2 years 3 months 18 days | ||
Interest expense on finance leases | 373,407 | 0 | |
Continuing Operations | |||
Operating Lease, Right-of-Use Asset | 105,432 | ||
Operating Lease, Liability | 686,753 | ||
Operating lease expenses | 294,127 | 67,662 | |
Discontinued operations | |||
Operating Lease, Liability | (53,899) | ||
Operating lease expenses | $ 84,372 | $ 128,024 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) | 12 Months Ended |
Mar. 31, 2020USD ($) | |
Number Of Automobiles | 50 |
Purchase Commitment, Remaining Minimum Amount Committed | $ 699,000 |
Loss contingency accrual, provision | 225,000 |
Loss Contingency Accrual | 18,627,000 |
Loss Contingency, Fair Value Of Collateral | 13,918,000 |
Loss contingency, amount past due including interest to financial institutions | 1,431,000 |
Loss contingency, amount of interest past due to financial institutions | $ 84,000 |
Maximum [Member] | |
Loss Contingency, Percentage of Contingent Liabilities | 74.70% |
P2P Business | |
Loss Contingency Accrual | $ 497,400 |
PARENT-ONLY FINANCIALS - Conden
PARENT-ONLY FINANCIALS - Condensed Balance Sheets (Details) - USD ($) | Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 |
Current Assets | |||
Cash and cash equivalents | $ 844,027 | $ 5,020,510 | $ 11,141,566 |
Due from investors | 26,461 | 140,498 | |
Prepayments, receivables and other assets | 3,615,221 | 3,793,468 | |
Escrow receivable due within one year | 0 | 600,000 | |
Total Current Assets | 6,606,139 | 11,399,155 | |
Other Assets | |||
Intangible assets | 777,621 | 1,627 | |
Prepayments for intangible assets | 0 | 280,000 | |
Total Assets | 15,630,718 | 12,314,135 | |
Current Liabilities | |||
Accrued expenses and other liabilities | 2,008,391 | 962,291 | |
Derivative liabilities | 342,530 | 0 | |
Total Current Liabilities | 11,132,530 | 3,753,604 | |
Other Liabilities | |||
Total Liabilities | 14,158,361 | 3,931,393 | |
Commitments and Contingencies | |||
Stockholders' Equity | |||
Common stock (par value $0.0001 per share, 100,000,000 shares authorized;29,008,818 and 25,945,255 shares issued and outstanding at March 31, 2020 and 2019, respectively) | 2,901 | 2,595 | |
Accumulated deficit | (23,704,863) | (15,031,538) | |
Accumulated other comprehensive loss | (507,478) | (428,771) | |
Total Stockholders' Equity | 2,803,697 | 8,375,398 | |
Noncontrolling interests | (1,331,340) | 7,344 | |
Total Equity | 1,472,357 | 8,382,742 | 12,878,670 |
Total Liabilities and Equity | 15,630,718 | 12,314,135 | |
Parent Company [Member] | |||
Current Assets | |||
Cash and cash equivalents | 2,590 | 1,950,347 | $ 10,961,071 |
Due from investors | 2,575,039 | 1,900,000 | |
Prepayments, receivables and other assets | 92,375 | 208,327 | |
Escrow receivable due within one year | 0 | 600,000 | |
Total Current Assets | 2,670,004 | 4,658,674 | |
Other Assets | |||
Intangible assets | 750,000 | 0 | |
Prepayments for intangible assets | 0 | 280,000 | |
Investment in subsidiary | 0 | 3,718,896 | |
Total Assets | 3,420,004 | 8,657,570 | |
Current Liabilities | |||
Accrued expenses and other liabilities | 128,796 | 282,172 | |
Derivative liabilities | 342,530 | 0 | |
Total Current Liabilities | 471,326 | 282,172 | |
Other Liabilities | |||
Excess of investments in subsidiaries | 144,980 | 0 | |
Total Liabilities | 616,306 | 282,172 | |
Commitments and Contingencies | |||
Stockholders' Equity | |||
Common stock (par value $0.0001 per share, 100,000,000 shares authorized;29,008,818 and 25,945,255 shares issued and outstanding at March 31, 2020 and 2019, respectively) | 2,901 | 2,595 | |
Additional paid-in capital | 27,013,137 | 23,833,112 | |
Accumulated deficit | (23,704,862) | (15,031,538) | |
Accumulated other comprehensive loss | (507,478) | (428,771) | |
Total Equity | 2,803,698 | 8,375,398 | |
Total Liabilities and Equity | $ 3,420,004 | $ 8,657,570 |
PARENT-ONLY FINANCIALS - Cond_2
PARENT-ONLY FINANCIALS - Condensed Balance Sheets (Parenthetical) (Details) - $ / shares | Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 |
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | |
Common Stock, Shares Authorized | 100,000,000 | 100,000,000 | |
Common Stock, Shares, Issued | 29,008,818 | 25,945,255 | |
Common Stock, Shares, Outstanding | 29,008,818 | 25,945,255 | |
Parent Company [Member] | |||
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 | |
Common Stock, Shares Authorized | 100,000,000 | 100,000,000 | |
Common Stock, Shares, Issued | 29,008,818 | 25,945,255 | |
Common Stock, Shares, Outstanding | 29,008,818 | 25,945,255 |
PARENT-ONLY FINANCIALS - Cond_3
PARENT-ONLY FINANCIALS - Condensed Statements of Operations (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
General and administrative expenses | $ (5,567,939) | $ (1,776,690) |
Change in fair value of derivative liabilities | 1,796,724 | 0 |
Net (loss) income | (9,935,803) | (4,542,525) |
Net income attributable to noncontrolling interest | (1,262,478) | 7,344 |
Foreign currency translation adjustment | (154,913) | (175,010) |
Comprehensive Loss | (10,090,716) | (4,717,535) |
Parent Company [Member] | ||
General and administrative expenses | (1,215,156) | (1,098,416) |
Other income, net | 359 | 6,810 |
Change in fair value of derivative liabilities | 1,796,724 | 0 |
Equity of loss in subsidiaries | (9,255,252) | (3,458,263) |
Net (loss) income | (8,673,325) | (4,549,869) |
Foreign currency translation adjustment | (78,707) | (175,010) |
Comprehensive Loss | $ (8,752,032) | $ (4,724,879) |
PARENT-ONLY FINANCIALS - Cond_4
PARENT-ONLY FINANCIALS - Condensed Statements of Cash Flows (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash Flows From Operating Activities | ||
Net (loss) income | $ (9,935,803) | $ (4,542,525) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Stock compensation expense | 133,150 | 44,200 |
Change in fair value of derivative liabilities | (1,796,724) | 0 |
Change in operating assets and liabilities | ||
Prepayments, other receivables and other assets | (964,889) | (1,952,696) |
Accrued expenses and other liabilities | 1,138,316 | 99,515 |
Cash Flows Used in Operating Activities | (6,447,664) | (6,256,226) |
Cash Flows From Investing Activities: | ||
Purchases of intangible assets | (470,000) | (280,869) |
Deposits in intangible assets | (470,000) | (280,869) |
Working capital contribution for subsidiaries | (5,470,082) | (6,300,000) |
Cash Flows Used in Investing Activities | (963,416) | (532,625) |
Cash Flows From Financing Activities: | ||
Repayments to related parties and affiliates | (1,405,356) | (487,115) |
Borrowings to subsidiaries | (675,039) | 0 |
Release of escrow | 600,000 | 600,000 |
Cash Flows Used in Financing Activities | 3,431,797 | 701,207 |
Net (decrease) increase in cash and cash equivalents | (4,176,483) | (6,121,056) |
Cash and cash equivalents, beginning of year | 5,020,510 | 11,141,566 |
Cash and cash equivalents, end of year | 844,027 | 5,020,510 |
Supplemental Cash Flows Information: | ||
Income tax paid | 0 | 0 |
Non-Cash Investing and Financing Activities: | ||
Prepayment in exchange of intangible assets | 280,000 | 0 |
Allocation of fair value of derivative liabilities for issuance of common stock proceeds | 3,150,006 | 0 |
Allocation of fair value of derivative liabilities to additional paid in capital upon warrants exercised | 1,010,752 | 0 |
Issuance of restricted stock units from accrued expenses and other liabilities | 44,200 | 0 |
Parent Company [Member] | ||
Cash Flows From Operating Activities | ||
Net (loss) income | (8,673,325) | (4,549,869) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Equity of loss of subsidiaries | 9,255,252 | 3,458,263 |
Change in fair value of derivative liabilities | (1,796,724) | 0 |
Change in operating assets and liabilities | ||
Prepayments, other receivables and other assets | 115,952 | (168,362) |
Accrued expenses and other liabilities | (109,176) | 84,890 |
Cash Flows Used in Operating Activities | (1,074,871) | (1,130,878) |
Cash Flows From Investing Activities: | ||
Purchases of intangible assets | 0 | (280,000) |
Deposits in intangible assets | 0 | (280,000) |
Cash Flows Used in Investing Activities | (5,940,082) | (6,580,000) |
Cash Flows From Financing Activities: | ||
Net Proceeds from issuance of common stock in initial public offering | 5,142,124 | 0 |
Proceeds from exercise of the underwriter's overallotment option | 111 | 0 |
Proceeds borrowed from stockholders | 0 | 154 |
Repayments to related parties and affiliates | 0 | (1,900,000) |
Release of escrow | 600,000 | 600,000 |
Cash Flows Used in Financing Activities | 5,067,196 | (1,299,846) |
Net (decrease) increase in cash and cash equivalents | (1,947,757) | (9,010,724) |
Cash and cash equivalents, beginning of year | 1,950,347 | 10,961,071 |
Cash and cash equivalents, end of year | 2,590 | 1,950,347 |
Supplemental Cash Flows Information: | ||
Income tax paid | 0 | 0 |
Interest paid | 0 | 0 |
Non-Cash Investing and Financing Activities: | ||
IPO expenses paid by the Company's stockholders | 0 | 70,687 |
Prepayment in exchange of intangible assets | 280,000 | 0 |
Issuance of restricted stock units from accrued expenses and other liabilities | $ 44,200 | $ 0 |
PARENT-ONLY FINANCIALS - Narrat
PARENT-ONLY FINANCIALS - Narrative (Details) - USD ($) | Dec. 11, 2019 | Jun. 21, 2019 | Dec. 11, 2018 | Jul. 31, 2018 | Mar. 31, 2020 | Mar. 31, 2019 |
Stock Issued During Period, Shares, New Issues | 1,781,361 | 5,000 | ||||
Stock Issued During Period, Value, New Issues | $ 1,992,118 | |||||
Shares Issued, Price Per Share | $ 3.38 | |||||
Stock Issued During Period, Shares, Restricted Stock Award, Gross | 25,000 | |||||
Stock Issued During Period, Value, Restricted Stock Award, Gross | $ 117,750 | |||||
Allocated Share-based Compensation Expense | $ 133,150 | $ 44,200 | ||||
Common Stock, Shares, Outstanding | 29,008,818 | 25,945,255 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeited in Period | 7,500 | |||||
Common stock [Member] | ||||||
Stock Issued During Period, Shares, New Issues | 1,781,360 | |||||
Stock Issued During Period, Value, New Issues | $ 178 | |||||
Restricted stock units | ||||||
Stock Issued During Period, Shares, Restricted Stock Award, Gross | 30,303 | 30,303 | 5,000 | 169,015 | 6,250 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeited in Period | 7,500 | |||||
Parent Company [Member] | ||||||
Proceeds from Issuance Initial Public Offering | $ 5,142,124 | $ 0 | ||||
Common Stock, Shares, Outstanding | 29,008,818 | 25,945,255 |
PARENT-ONLY FINANCIALS - Regist
PARENT-ONLY FINANCIALS - Registered Direct Offering (Details) | Dec. 20, 2019director$ / sharesshares | Dec. 11, 2019shares | Jun. 21, 2019USD ($)$ / sharesshares | Dec. 11, 2018shares | Jun. 21, 2019USD ($)$ / sharesshares | Jul. 31, 2018shares | Mar. 31, 2020USD ($)$ / sharesshares | Mar. 31, 2019shares | Aug. 12, 2019$ / shares | Jun. 20, 2019$ / shares | Apr. 15, 2019USD ($) | Mar. 15, 2019shares |
Class of Warrant or Right [Line Items] | ||||||||||||
Sale Of Aggregate Principal Amount Of Our Equity | $ | $ 80,000,000 | |||||||||||
Shares Issued, Price Per Share | $ / shares | $ 3.38 | $ 3.38 | ||||||||||
Proceeds from Issuance of Common Stock | $ | $ 6,000,000 | $ 6,000,000 | $ 1,992,118 | |||||||||
Stock Issued During Period, Shares, New Issues | 1,781,361 | 5,000 | ||||||||||
Restricted stock units approved for issuance | 25,000 | |||||||||||
RSUs vested | 162,765 | 6,250 | ||||||||||
Maximum adjustment price | $ / shares | $ 1.50 | |||||||||||
Quotient Percentage | 100.00% | |||||||||||
Number of lowest volume weighted average price | director | 5 | |||||||||||
Consecutive trading day period ending and including the Six Month Measuring Date to calculate VWAP | 10 days | |||||||||||
Fairvalue of Warrants and rights outstanding warrants exercised | $ | $ 1,010,752 | |||||||||||
Restricted stock units | ||||||||||||
Class of Warrant or Right [Line Items] | ||||||||||||
Restricted stock units approved for issuance | 30,303 | 30,303 | 5,000 | 169,015 | 6,250 | |||||||
Series A Warrants [Member] | ||||||||||||
Class of Warrant or Right [Line Items] | ||||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 3.72 | 1,336,021 | 1,336,021 | |||||||||
Exercise price of warrants | $ / shares | $ 3.72 | $ 1.50 | $ 3.72 | |||||||||
Series B Warrants [Member] | ||||||||||||
Class of Warrant or Right [Line Items] | ||||||||||||
Proceeds from Issuance of Common Stock | $ | $ 111 | |||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 1,116,320 | 1,116,320 | 1,116,320 | |||||||||
Exercise price of warrants | $ / shares | $ 0.0001 | $ 3.72 | ||||||||||
Common stock [Member] | ||||||||||||
Class of Warrant or Right [Line Items] | ||||||||||||
Stock Issued During Period, Shares, New Issues | 1,781,360 | |||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 300,000 | |||||||||||
Common stock [Member] | Series A Warrants [Member] | ||||||||||||
Class of Warrant or Right [Line Items] | ||||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 1,336,021 | 1,336,021 | ||||||||||
Common stock [Member] | Series B Warrants [Member] | ||||||||||||
Class of Warrant or Right [Line Items] | ||||||||||||
Stock Issued During Period, Shares, New Issues | 1,113,187 | |||||||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 1,116,320 | 1,116,320 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - Subsequent Event [Member] $ in Millions | Jul. 04, 2020CNY (¥) | Jul. 04, 2020USD ($) | Jul. 04, 2020USD ($) |
Jinkailong | |||
Subsequent Event [Line Items] | |||
Equity interest | 27.03% | 27.03% | |
Equity Method Investments | ¥ 50,000,000 | $ 7 | |
Performance commitment period | 3 years | 3 years | |
Maximum re-purchase provision | ¥ 28,320,000 | $ 4 | |
Jinkailong | First payment due no later than September 30, 2020 | |||
Subsequent Event [Line Items] | |||
Equity Method Investments | 10,000,000 | 1.4 | |
Jinkailong | Remaining payment due within 30 days after the record-filing of Investment, but no later than December 31, 2020 | |||
Subsequent Event [Line Items] | |||
Equity Method Investments | 40,000,000 | 5.6 | |
Jinkailong | Performance commitment period one | |||
Subsequent Event [Line Items] | |||
Annual revenue in performance commitment period | 52,000,000 | 7.4 | |
Annual net profit in performance commitment period | 10,000,000 | 1.4 | |
Jinkailong | Performance commitment period two | |||
Subsequent Event [Line Items] | |||
Annual revenue in performance commitment period | 90,000,000 | 12.7 | |
Annual net profit in performance commitment period | 20,000,000 | 2.8 | |
Jinkailong | Performance commitment period three | |||
Subsequent Event [Line Items] | |||
Annual revenue in performance commitment period | 110,000,000 | 15.6 | |
Annual net profit in performance commitment period | 25,000,000 | 3.5 | |
Jinkailong | Failed to achieve | |||
Subsequent Event [Line Items] | |||
Valuation amount to become public | 350,000,000 | 49.5 | |
Valuation amount to merge with public company | 300,000,000 | 42.5 | |
Accumulated net profit for first two years | 24,000,000 | 3.4 | |
Accumulated net profit for the third year of the performance commitment period | 20,000,000 | $ 2.9 | |
Hunan Ruixi [Member] | |||
Subsequent Event [Line Items] | |||
Capital contribution | ¥ 3,500,000 | $ 0.5 |