Document And Entity Information
Document And Entity Information | 12 Months Ended |
Jun. 30, 2022 shares | |
Document Information Line Items | |
Entity Registrant Name | Color Star Technology Co., Ltd. |
Trading Symbol | ADD |
Document Type | 20-F |
Current Fiscal Year End Date | --06-30 |
Entity Common Stock, Shares Outstanding | 191,757,531 |
Amendment Flag | false |
Entity Central Index Key | 0001747661 |
Entity Current Reporting Status | Yes |
Entity Voluntary Filers | No |
Entity Filer Category | Non-accelerated Filer |
Entity Well-known Seasoned Issuer | No |
Document Period End Date | Jun. 30, 2022 |
Document Fiscal Year Focus | 2022 |
Document Fiscal Period Focus | FY |
Entity Emerging Growth Company | false |
Entity Shell Company | false |
ICFR Auditor Attestation Flag | false |
Document Registration Statement | false |
Document Annual Report | true |
Document Transition Report | false |
Document Shell Company Report | false |
Entity File Number | 333-226308 |
Entity Incorporation, State or Country Code | E9 |
Entity Address, Address Line One | 7 World Trade Center |
Entity Address, Address Line Two | Suite 4621 |
Entity Address, City or Town | New York |
Entity Address, State or Province | NY |
Entity Address, Postal Zip Code | 10022 |
Title of 12(b) Security | Ordinary Shares, par value $0.04 |
Security Exchange Name | NASDAQ |
Entity Interactive Data Current | Yes |
Document Accounting Standard | U.S. GAAP |
Auditor Firm ID | 3487 |
Auditor Name | Wei, Wei & Co. LLP |
Auditor Location | New York |
Entity Address, Country | US |
Business Contact | |
Document Information Line Items | |
Entity Address, Address Line One | 7 World Trade Center |
Entity Address, Address Line Two | Suite 4621 |
Entity Address, City or Town | New York |
Entity Address, State or Province | NY |
Entity Address, Postal Zip Code | 10022 |
Contact Personnel Name | Farhan Qadir |
City Area Code | (929) |
Local Phone Number | 317-2699 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Jun. 30, 2022 | Jun. 30, 2021 | |
CURRENT ASSETS: | |||
Cash and cash equivalents | $ 872,313 | $ 174,189 | |
Accounts receivable | 2,507,981 | 3,191,711 | |
Other receivables | 6,819,050 | 8,900 | |
Prepayments | 17,666,664 | 4,267,827 | |
Total current assets | 27,866,008 | 7,642,627 | |
NON-CURRENT ASSETS | |||
Prepayments | 52,000,000 | ||
Property, plant and equipment, net | 30,228 | 9,160,214 | |
Intangible assets, net | 25,566,958 | 12,272,326 | |
Total non-current assets | 25,597,186 | 73,432,540 | |
Total assets | 53,463,194 | 81,075,167 | |
CURRENT LIABILITIES: | |||
Accounts payable | 3,770,945 | ||
Other payables and accrued liabilities | 885,601 | 517,134 | |
Other payables - related parties | 362,884 | 10,711 | |
Deferred revenue | 3,596,821 | ||
Total current liabilities | 5,019,430 | 4,124,666 | |
Total liabilities | 5,019,430 | 4,124,666 | |
COMMITMENTS AND CONTINGENCIES | |||
SHAREHOLDERS’ EQUITY: | |||
Ordinary shares, $0.04 par value, 800,000,000 shares authorized, 4,819,700 and 2,758,920 shares issued and outstanding as of June 30, 2022 and 2021, respectively | [1] | 192,788 | 110,357 |
Additional paid-in-capital | 195,654,317 | 147,684,772 | |
Deferred stock compensation | (32,978) | (682,383) | |
Deficit | (147,370,363) | (70,162,245) | |
Total shareholders’ equity | 48,443,764 | 76,950,501 | |
Total liabilities and shareholders’ equity | $ 53,463,194 | $ 81,075,167 | |
[1]Giving retroactive effect to the 40-for-1 reverse share split on September 26, 2022. |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - $ / shares | Jun. 30, 2022 | Jun. 30, 2021 |
Statement of Financial Position [Abstract] | ||
Ordinary shares, par value (in Dollars per share) | $ 0.04 | $ 0.04 |
Ordinary shares, shares authorized | 800,000,000 | 800,000,000 |
Ordinary shares, shares issued | 4,819,700 | 2,758,920 |
Ordinary shares, shares outstanding | 4,819,700 | 2,758,920 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Loss - USD ($) | 12 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | ||
Income Statement [Abstract] | ||||
REVENUE | $ 16,519,081 | $ 6,783,957 | ||
COST OF REVENUE | 8,546,840 | 4,139,251 | ||
GROSS PROFIT | 7,972,241 | 2,644,706 | ||
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES | (13,861,742) | (5,664,675) | (1,598,984) | |
RESEARCH AND DEVELOPMENT EXPENSES | (68,275,869) | (817,794) | (120,000) | |
STOCK COMPENSATION EXPENSE | (4,732,700) | (5,717,900) | (3,444,617) | |
IMPAIRMENT LOSS OF LONG-LIVED ASSETS | (99,943) | |||
LOSS FROM OPERATIONS | (78,898,070) | (9,655,606) | (5,163,601) | |
OTHER INCOME (EXPENSE), NET | ||||
Other income, net | 1,696,984 | 31,083 | ||
Interest income | 1 | 136 | ||
Finance expense | (7,033) | (14,226) | (5,041) | |
TOTAL OTHER INCOME (EXPENSE), NET | 1,689,952 | 16,993 | (5,041) | |
LOSS BEFORE PROVISION FOR INCOME TAXES | (77,208,118) | (9,638,613) | (5,168,642) | |
PROVISION FOR INCOME TAXES | ||||
LOSS FROM CONTINUING OPERATIONS | (77,208,118) | (9,638,613) | (5,168,642) | |
DISCONTINUED OPERATIONS: | ||||
Loss from discontinued operations, net of applicable income taxes | (12,245,168) | |||
Net gain on sale of discontinued operations, net of applicable income taxes | 1,400,100 | 5,787,213 | ||
GAIN/(LOSS) FROM DISCONTINUED OPERATIONS | 1,400,100 | (6,457,955) | ||
NET LOSS | $ (77,208,118) | $ (8,238,513) | $ (11,626,597) | |
Weighted average number of shares* | ||||
Basic and diluted (in Shares) | [1] | 3,880,561 | 1,702,387 | 291,001 |
Loss per share - basic and diluted* | ||||
Continuing operations (in Dollars per share) | [1] | $ (19.9) | $ (5.66) | $ (17.76) |
Discontinued operations (in Dollars per share) | [1] | 0.82 | (22.19) | |
Total (in Dollars per share) | [1] | $ (19.9) | $ (4.84) | $ (39.95) |
[1]Giving retroactive effect to the 40-for-1 reverse share split on September 26, 2022. |
Consolidated Statements of Op_2
Consolidated Statements of Operations and Comprehensive Loss (Parentheticals) - shares | 12 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | ||
Income Statement [Abstract] | ||||
Basic and diluted | [1] | 3,880,561 | 1,702,387 | 291,001 |
[1]Giving retroactive effect to the 40-for-1 reverse share split on September 26, 2022. |
Consolidated Statements of Shar
Consolidated Statements of Shareholders’ Equity - USD ($) | Ordinary shares | Additional paid-in capital | Deferred share compensation | Deficit | Statutory reserves | Accumulated other comprehensive income | Total | ||
Balance at Jun. 30, 2019 | $ 7,175 | [1] | $ 54,237,082 | $ (3,161,200) | $ (64,031,446) | $ 6,248,092 | $ 7,221,095 | $ 520,798 | |
Balance (in Shares) at Jun. 30, 2019 | [1] | 179,366 | |||||||
Sale of ordinary shares | $ 7,327 | [1] | 4,495,574 | 4,502,901 | |||||
Sale of ordinary shares (in Shares) | [1] | 183,182 | |||||||
Ordinary shares issued for services | $ 400 | [1] | 34,600 | (35,000) | |||||
Ordinary shares issued for services (in Shares) | [1] | 10,000 | |||||||
Ordinary shares issued for debt conversion | $ 3,679 | [1] | 5,626,570 | 5,630,249 | |||||
Ordinary shares issued for debt conversion (in Shares) | [1] | 91,985 | |||||||
Ordinary shares issued for acquisition of subsidiary | $ 1,989 | [1] | 1,887,810 | 1,889,799 | |||||
Ordinary shares issued for acquisition of subsidiary (in Shares) | [1] | 49,732 | |||||||
Ordinary shares issued for acquisition of equipment | $ 4,634 | [1] | 1,958,973 | 1,963,607 | |||||
Ordinary shares issued for acquisition of equipment (in Shares) | [1] | 115,834 | |||||||
Unvested restricted ordinary shares issued to officer | $ 420 | [1] | 84,180 | (84,600) | |||||
Unvested restricted ordinary shares issued to officer (in Shares) | [1] | 10,500 | |||||||
Stock compensation expense | [1] | 3,444,617 | 3,444,617 | ||||||
Net loss | [1] | (11,626,597) | (11,626,597) | ||||||
Foreign currency translation gain | [1] | 265,124 | 265,124 | ||||||
Deconsolidation of discontinued operations | [1] | 13,734,311 | (6,248,092) | (7,486,219) | |||||
Balance at Jun. 30, 2020 | $ 25,624 | [1] | 69,689,789 | (1,201,183) | (61,923,732) | 6,590,498 | |||
Balance (in Shares) at Jun. 30, 2020 | [1] | 640,599 | |||||||
Sale of ordinary shares | $ 57,250 | [1] | 62,283,775 | 62,341,025 | |||||
Sale of ordinary shares (in Shares) | [1] | 1,431,260 | |||||||
Ordinary shares issued for exercise of warrants | $ 13,657 | [1] | 5,157,934 | 5,171,591 | |||||
Ordinary shares issued for exercise of warrants (in Shares) | [1] | 341,432 | |||||||
Ordinary shares issued for services | $ 700 | [1] | 440,300 | 441,000 | |||||
Ordinary shares issued for services (in Shares) | [1] | 17,500 | |||||||
Ordinary shares issued for compensation | $ 5,130 | [1] | 4,091,370 | 4,096,500 | |||||
Ordinary shares issued for compensation (in Shares) | [1] | 128,250 | |||||||
Ordinary shares issued for acquisition of equipment | $ 6,061 | [1] | 3,811,939 | 3,818,000 | |||||
Ordinary shares issued for acquisition of equipment (in Shares) | [1] | 151,508 | |||||||
Ordinary shares issued for acquisition of intangible assets | $ 1,815 | [1] | 1,548,185 | 1,550,000 | |||||
Ordinary shares issued for acquisition of intangible assets (in Shares) | [1] | 45,371 | |||||||
Unvested restricted ordinary shares issued to officer | $ 120 | [1] | 969,880 | (970,000) | |||||
Unvested restricted ordinary shares issued to officer (in Shares) | [1] | 3,000 | |||||||
Forfeiture of unvested restricted ordinary shares | [1] | (308,400) | 308,400 | ||||||
Stock compensation expense | [1] | 1,180,400 | 1,180,400 | ||||||
Net loss | [1] | (8,238,513) | (8,238,513) | ||||||
Balance at Jun. 30, 2021 | $ 110,357 | [1] | 147,684,772 | (682,383) | (70,162,245) | 76,950,501 | |||
Balance (in Shares) at Jun. 30, 2021 | [1] | 2,758,920 | |||||||
Sale of ordinary shares | $ 72,625 | [1] | 43,864,577 | 43,937,202 | |||||
Sale of ordinary shares (in Shares) | [1] | 1,815,624 | |||||||
Ordinary shares issued for exercise of warrants | $ 151 | [1] | 31,328 | 31,479 | |||||
Ordinary shares issued for exercise of warrants (in Shares) | [1] | 3,775 | |||||||
Ordinary shares issued for compensation | $ 8,625 | [1] | 4,242,670 | (86,260) | 4,165,035 | ||||
Ordinary shares issued for compensation (in Shares) | [1] | 215,625 | |||||||
Ordinary shares issued for acquisition of equipment | |||||||||
Forfeiture of unvested restricted ordinary shares | [1] | (168,000) | 168,000 | ||||||
Stock compensation expense | [1] | 567,665 | 567,665 | ||||||
Net loss | [1] | (77,208,118) | (77,208,118) | ||||||
Additional ordinary shares of round up adjustment due to retroactive effect of the 40-for-1 reverse share | $ 1,030 | [1] | (1,030) | ||||||
Additional ordinary shares of round up adjustment due to retroactive effect of the 40-for-1 reverse share (in Shares) | [1] | 25,756 | |||||||
Balance at Jun. 30, 2022 | $ 192,788 | [1] | $ 195,654,317 | $ (32,978) | $ (147,370,363) | $ 48,443,764 | |||
Balance (in Shares) at Jun. 30, 2022 | [1] | 4,819,700 | |||||||
[1]Giving retroactive effect to the 40-for-1 reverse share split on September 26, 2022. |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net loss | $ (77,208,118) | $ (8,238,513) | $ (11,626,597) |
Net income (loss) from discontinued operations | 1,400,100 | (6,457,955) | |
Net loss from continuing operations | (77,208,118) | (9,638,613) | (5,168,642) |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Depreciation | 1,445,573 | 1,536,178 | |
Amortization | 4,450,895 | 2,180,917 | |
Research and development expenses | 52,000,000 | ||
Stock compensation expense | 4,732,700 | 5,717,900 | 3,444,617 |
Impairment loss of long-lived assets | 99,943 | ||
Gain on disposal of equipment | (94,984) | ||
Gain on debt settlement | (25,092) | ||
Changes in operating assets and liabilities | |||
Accounts receivable | 683,730 | (3,191,711) | |
Other receivables | 8,900 | (6,600) | |
Prepayments | (15,964,364) | (3,247,827) | (1,145,000) |
Prepaid expenses | 130,036 | ||
Accounts payable | 3,770,945 | ||
Other payables and accrued liabilities | 368,466 | 174,104 | |
Other payables - related parties | |||
Deferred revenue | (3,596,821) | 3,596,821 | |
Net cash used in operating activities from continuing operations | (29,403,078) | (2,803,980) | (2,738,989) |
Net cash provided by (used in) operating activities from discontinued operations | 203,854 | ||
Net cash used in operating activities | (29,403,078) | (2,803,980) | (2,535,135) |
CASH FLOWS FROM INVESTING ACTIVITIES: | |||
Prepayments for intangible assets | (52,000,000) | ||
Purchase of equipment | (39,602) | (2,020,000) | (2,000,000) |
Purchase of intangible assets | (15,180,000) | (12,903,243) | |
Cash acquired through acquisition of Color China | 5,272 | ||
Proceeds from sales of equipment | 999,950 | ||
Proceeds from sales of discontinued operations | 600,000 | ||
Net cash provided by investing activities from continuing operations | (14,219,652) | (66,923,243) | (1,394,728) |
Net cash provided by (used in) investing activities from discontinued operations | 1,400,100 | ||
Net cash used in investing activities | (14,219,652) | (65,523,143) | (1,394,728) |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Borrowings from shareholders | 300,000 | ||
Borrowings from related parties | 352,173 | ||
Proceeds from sale of ordinary shares, net of offering costs | 43,937,202 | 62,341,025 | 4,502,901 |
Proceeds from exercise of warrants | 31,479 | 5,171,591 | |
Net cash provided by financing activities from continuing operations | 44,320,854 | 67,512,616 | 4,802,901 |
Net cash used in financing activities from discontinued operations | (7,294) | ||
Net cash provided by financing activities | 44,320,854 | 67,512,616 | 4,795,607 |
EFFECTS OF EXCHANGE RATE CHANGE IN CASH AND CASH EQUIVALENTS | (1,943) | ||
NET CHANGE IN CASH AND CASH EQUIVALENTS | 698,124 | (814,507) | 863,801 |
CASH AND CASH EQUIVALENTS, beginning of year | 174,189 | 988,696 | 347,486 |
CASH AND CASH EQUIVALENTS, end of year | 872,313 | 174,189 | 1,211,287 |
LESS: CASH AND CASH EQUIVALENTS DISPOSED THROUGH DISCONTINUED OPERATIONS | (222,591) | ||
CASH AND CASH EQUIVALENTS, end of year | 872,313 | 174,189 | 988,696 |
SUPPLEMENTAL CASH FLOW INFORMATION: | |||
Cash paid for interest expense | |||
Cash paid for income tax | |||
NON-CASH TRANSACTIONS OF INVESTING AND FINANCING ACTIVITIES: | |||
Ordinary shares issued to repay other payables - related parties and service providers | 5,630,249 | ||
Ordinary shares issued for acquisition of subsidiary | 1,889,799 | ||
Ordinary shares issued for acquisition of equipment | 3,818,000 | 1,963,607 | |
Ordinary shares issued for acquisition of intangible assets | 1,550,000 | ||
Other receivables from disposal of subsidiary | 1,000,000 | ||
Transfer of prepayments to intangible assets | 2,565,527 | ||
Unpaid receivable from disposal of equipment | 6,819,050 | ||
OTHER NON-CASH TRANSACTIONS: | |||
Operating lease right-of-use assets recognized for related operating lease liabilities | 1,375,181 | ||
Accounts receivable offset with accounts payable upon execution of debt obligation transfer agreements | 7,029,929 | ||
Other receivables offset with payments for equipment purchase | 1,000,000 | ||
Prepayment offset with other payables for debt settlement | $ 150,000 |
Organization and Description of
Organization and Description of Business | 12 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
Organization and description of business | Note 1 – Organization and description of business Color Star Technology Co., Ltd. (the “Company” or “Color Star”) is an entertainment and education company which provides online entertainment performances and online music education services via its wholly-owned subsidiary, Color China Entertainment Limited (“Color Sky”). The Company was founded as an unincorporated business on September 1, 2005, under the name TJS Wood Flooring, Inc., and became a C-corporation in the State of Delaware on February 15, 2007. On April 29, 2008, TJS Wood Flooring, Inc. changed its name to China Advanced Construction Materials Group, Inc. (“CADC Delaware”). On August 1, 2013, CADC Delaware consummated a reincorporation merger with its newly formed wholly-owned subsidiary, China Advanced Construction Materials Group, Inc. (“CADC Nevada”), a Nevada corporation, with CADC Delaware merging into CADC Nevada and CADC Nevada being the surviving company, for the purpose of changing CADC Delaware’s state of incorporation from Delaware to Nevada. On December 27, 2018, CADC Nevada was merged with and into China Advanced Construction Materials Group, Inc. (“CADC Cayman”), a Cayman Islands corporation, whereupon the separate existence of CADC Nevada ceased and CADC Cayman continued as the surviving entity. As a result of the reincorporation, the Company is governed by the laws of the Cayman Islands. On November 22, 2021, Color China changed its name from “Color China Entertainment Limited” to “Color Sky Entertainment Limited.” CACM Group NY, Inc. On August 20, 2018, CACM Group NY, Inc. (“CACM”) was incorporated in the State of New York and is 100% owned by the Company. As of the date of this report, CACM has not commenced any business operations and the Company is currently using CACM as its headquarters in the United States of America. Baytao LLC (“Baytao”) On March 10, 2020, CACM entered into a joint venture agreement (the “JV Agreement”) with Baydolphin, Inc. (“Baydolphin”), a company organized under the laws of New York. Pursuant to the JV Agreement, ● CACM and Baydolphin established a limited liability company under the laws of New York, Baytao, which will be the 100% owner of one or more operating entities in the U.S. to engage in the business of online and offline after-school education. ● The business of Baytao shall be managed by the Board of Managers of Baytao. ● CACM shall appoint three designees to the Board of Managers of Baytao and Baydolphin shall appoint two designees. The General Manager of Baytao shall be appointed by CACM and report to the Board of Managers. ● CACM shall contribute necessary capital for the operating entities to fund their operations and obtain the right to use the software platform and other technologies from Color Star, which will be provided to the JV and its operating entities for no charge to facilitate their operations and provide online classes to their registered students, and Baydolphin shall be responsible for managing these entities with its expertise in after-school education, including but not limited to recruiting and training personnel and implementing all promotional and marketing activities. ● Eighty percent (80%) of the net profits or net loss of the joint venture will be distributed to or assigned to CACM and the remaining twenty percent (20%) to Baydolphin. On June 29, 2021, CACM (the “Seller”) entered into a share purchase agreement (the “Agreement”) with Baydolphin (the “Buyer”). Pursuant to the Agreement, the Seller agreed to sell, and the Buyer agreed to purchase 80% of the outstanding equity interest of Baytao for a consideration of $100. Prior to the sale, Baytao had no operation or asset. Upon completion of the sale, Baytao ceased to be a subsidiary of the Company. Color Sky The ongoing COVID-19 pandemic has claimed hundreds of thousands of lives and caused massive global health and economic crisis, while also causing large-scale social and behavioral changes in societies. Online entertainment and online education are experiencing enormous growth which the Company believes will last long after the pandemic. In order to expand the Company’s global reach and to enter into an online business, on May 7, 2020, the Company entered into a Share Exchange Agreement (“Exchange Agreement”) with Color Sky, a Hong Kong limited company, and shareholders of Color Sky (the “Sellers”), pursuant to which, among other things and subject to the terms and conditions contained therein, the Company acquired all of the outstanding issued shares in Color Sky from the sellers (the “Acquisition”). Pursuant to the Exchange Agreement, in exchange for all of the outstanding shares of Color Sky, the Company agreed to issue 115,834ordinary shares of the Company and pay an aggregate of $2,000,000 to the Sellers. On June 3, 2020, the Acquisition was consummated and the Company issued 115,834 ordinary shares of the Company to the Sellers and closed on the same date. Since Color Sky had no business operations other than holding a significant collection of music performance specific equipment, the transaction has been treated as an acquisition of assets, as it did not meet the definition of a business. The Company plans to make Color Sky an emerging online performance and online music education provider with a significant collection of performance specific assets -- leveraging professional experience of the Company’s new Chief Executive Officer (“CEO”) who has established good relationships with major record companies, renowned artists and entertainment agencies around the world. Color Sky is in the process of building an online entertainment and music education platform featuring artists and professional producers as its lead instructors. Color Sky officially launched its online cultural entertainment platform, Color World, globally on September 10, 2020. The Color World platform (or online education academy App) has not only celebrity lectures, but also celebrity concert videos, celebrity peripheral products, such as celebrity branded merchandise, and artist interactive communication. Modern Pleasure International Limited On June 18, 2021, Modern Pleasure International Limited (“Modern Pleasure”), a limited liability company, was incorporated in Hong Kong and is wholly established and owned by the Company. As of the date of this report,, Modern Pleasure has not commenced operations. Color Metaverse Pte. Ltd. On February 21, 2022, Color Metaverse Pte.Ltd (“Color Metaverse”), a private company limited by shares, was incorporated in Singapore and is wholly established and owned by the Company. Color Metaverse commenced operations in September 2022. Color Star Technology Ohio Inc. On August 11, 2022, Color Star Technology Ohio Inc. (“Color Star Ohio”) was incorporated in the State of Ohio and is 100% owned by the Company. As of the date of this report, Color Star Ohio has not commenced operations. |
Summary of significant accounti
Summary of significant accounting policies | 12 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
Summary of significant accounting policies | Note 2 – Summary of significant accounting policies Going concern uncertainty The Company had an accumulated deficit of approximately $147.4 million as June 30, 2022 and had a net loss of approximately $77.2 million for the year ended June 30, 2022. In January 2022, the Company’s Color World platform was transformed into the current version, a metaverse with “artificial intelligence + celebrity entertainment” as its core features but it is currently suspending such revenue stream. The Company is expected to resume generating revenue again in January 2023 because the Company is planning to transform its Color World platform into a paid subscripted fee version for our users. If the Company is unable to generate sufficient cash flow within the normal operating cycle of a twelve month period to pay for its future payment obligations, the Company may be required to curtail or cease its operations. Management is trying to alleviate the going concern risk through obtaining additional equity financings to support its working capital, including its recently completed equity financing transaction of approximately $5.6 million on September 14, 2022. However, there is no assurance that management will be successful in their plans. The consolidated financial statements does not include any adjustments that might result from the outcome of this uncertainty Basis of presentation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). These consolidated financial statements include the accounts of all the directly and indirectly owned subsidiaries listed below. All intercompany transactions and balances have been eliminated in consolidation. Principles of consolidation The consolidated financial statements reflect the activities of the following subsidiaries. All material intercompany transactions and balances have been eliminated. Subsidiaries Place incorporated Ownership CACM New York, USA 100 % Color Sky Hong Kong 100 % Modern Pleasure Hong Kong 100 % Color Metaverse Singapore 100 % Color Star Ohio Ohio, USA 100 % Use of estimates and assumptions The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting periods. The significant estimates and assumptions made in the preparation of the Company’s consolidated financial statements include the allowance for credit losses of accounts receivable, other receivables, prepayments and advances and deferred income taxes, stock-based compensation, and fair value and useful lives of property, plant and equipment and intangibles assets. Actual results could be materially different from those estimates. Revenue recognition The Company follows the Financial Accounting Standards Board (“FASB”) Accounting Standards Update (“ASU”) 2014-09 Revenue from Contracts with Customers (ASC 606) to recognize its revenue for all period presented. The core principle underlying this ASU is that the Company recognizes its revenue to represent the transfer of goods and services to customers in an amount that reflects the consideration to which the Company expects to be entitled in such exchange. This 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. The Company’s revenue streams to be recognized at a point in time comprise principally of music performance performed or education services provided. The Company’s revenue streams to be recognized over a period of time comprise of its platform subscribed membership fees which is recognized over the subscription period. The ASU requires the use of a five-step model to recognize revenue from customer contracts. The five-step model requires that the Company (i) identify the contract with the customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, including variable consideration to the extent that it is probable that a significant future reversal will not occur, (iv) allocate the transaction price to the respective performance obligations in the contract, and (v) recognize revenue when (or as) the Company satisfies the performance obligation. The application of the five-step model to the revenue streams compared to the prior guidance did not result in significant changes in the way the Company records its revenue. Upon adoption, the Company evaluated its revenue recognition policy for all revenue streams within the scope of the ASU under previous standards and using the five-step model under the new guidance and confirmed that there were no material differences in the pattern of revenue recognition. 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 offered the following services: (a) Online education academy The Company earns revenues from its customers for subscription for services to be delivered over a period of time, the receipt is initially recorded as “deferred revenue” on the consolidated balance sheets and revenue is recognized ratably over the membership period as services are rendered, usually one year. Membership services revenue also includes fees earned from subscribing members for on-demand content purchases and early access to premium content. The Company is principal in its relationships where its partners, including artist agents, mobile operators, internet service providers and online payment agencies, provide access to the membership services or payment processing services as the Company retains control over its service delivery to its subscribing members. Typically, payments made to its partners, are recorded as cost of revenues and as research and development expenses prior to any revenues being generated in this revenue stream. In July 2021, the Company no longer required its subscribers to pay for the annual subscription fee. Revenues in connection with the on-demand contents are recognized at a point in time when the subscription fee was paid to stream the on-demand contents. (b) Online concert The Company holds online concerts with its star partners. Sale of online concert via subscription fee is accounted for as a single performance obligation which is satisfied at a point in time on the day of the event. Online concert subscription fees are recognized net of App payment collections agent service fee. All ticket sales are final upon payment. As a practical expedient, the Company elects to record the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that the entity otherwise would have recognized is one year or less. Disaggregated information of revenues by services are as follows: For the Years Ended June 30, 2022 2021 2020 Online music education academy subscription $ 16,519,081 $ 4,453,957 $ - Online concert subscription - 2,330,000 - Total revenue $ 16,519,081 $ 6,783,957 $ - Financial instruments US GAAP specifies a hierarchy of valuation techniques for determining the fair value of financial instruments and related fair value measurements based upon whether the inputs to those valuation techniques reflect assumptions other market participants would use based upon market data obtained from independent sources (observable inputs). The valuation hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. In accordance with FASB ASC 820, the following summarizes the fair value hierarchy: The three levels of inputs 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 asset or liability, either directly or indirectly, for substantially the full term of the financial instrument; Level 3 inputs to the valuation methodology are unobservable. Financial instruments included in current assets and current liabilities are reported in the consolidated balance sheets at face value or cost, which approximate fair value because of the short period of time between the origination of such instruments and their expected realization and their current market rates of interest. In June 2016, the Financial Accounting Standards Board (“FASB”) issued ASU 2016-13 (as amended through March 2020), Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 introduced a new forward-looking approach, based on expected losses, to estimate credit losses on certain types of financial instruments, including trade receivables, contract assets and held-to-maturity debt securities, which requires the Company to incorporate considerations of historical information, current information and reasonable and supportable forecasts. ASU 2016-13 also expands disclosure requirements. The Company adopted the standard on July 1, 2020 using the modified retrospective approach. Adoption of ASU 2016-13 resulted in changes to the Company’s accounting policies for trade and other receivables. Upon adoption of ASU 2016-13 the Company evaluates trade receivables and other receivables on a collective (i.e., pool) basis if they share similar risk characteristics. Based on the results of the Company’s evaluation, the adoption of ASU 2016-13 did not have a material impact on the reserve for credit losses as of July 1, 2020. Cash and cash equivalents The Company considers all highly liquid investments with the original maturity of three months or less at the date of purchase to be cash equivalents. Accounts receivable Accounts receivable include receivables from , net of an allowance for credit risk. Accounts receivable are recorded at amount received from the Company’s customers and do not bear interest. Allowance for credit losses for accounts receivables is established based on various factors including historical payments and current economic trends. The Company reviews its allowance for accounts receivable by assessing individual accounts receivable over a specific aging and amount. All other balances are pooled based on historical collection experience. The estimate of expected credit losses is based on information about past events, current economic conditions, and forecasts of future economic conditions that affect collectability. Accounts receivable are written-off on a case by case basis , net of any amounts that may be collected. Other receivables Other receivables primarily include security deposit and receivables resulted from sale of equipment, net of an allowance for credit losses Allowance for credit losses for other receivables is established based on various factors including historical payments and current economic trends. The Company reviews its allowance for other receivables by assessing individual other receivables over a specific aging and amount. All other balances are pooled based on historical collection experience. The estimate of expected credit losses is based on information about past events, current economic conditions, and forecasts of future economic conditions that affect collectability. Other receivables are written-off on a case by case basis , net of any amounts that may be collected. Prepayments, current Prepayments, current include funds deposited or advanced to outside vendors for future performance obligations, program license fees and service fees. As a standard practice in the music performance industry, many of the Company’s vendors require a certain amount to be deposited with them as a guarantee that the Company will complete its purchases on a timely basis. The Company has legally binding contracts with its vendors, the prepayments will be used to offset performance fees, program license fees, purchase price or service fees, and the amounts are refundable and bear no interest if outside vendors breach the contracts. Prepayments, non-current Prepayments, non-current represent cash deposited or advanced for software development expenditure. Property, plant and equipment Property, plant and equipment are stated at cost or at fair value of the identifiable assets acquired on the acquisition date less accumulated depreciation and impairment loss. Expenditures for maintenance and repairs are charged to operations as incurred while additions, renewals and improvements are capitalized. Depreciation is provided over the estimated useful life of each class of depreciable assets and is computed using the straight-line method with 0%-5% residual value. The estimated useful lives of assets are as follows: Useful life Performance equipment 10 years Office equipment 5 years Intangible assets, net Intangible assets are stated at cost, less accumulated amortization. Amortization expense is recognized on the straight-line basis over the estimated useful lives of the assets. The Company has obtained copyrights to use the online education academy courses for 3 years to unlimited years. The Company amortizes the copyrights with limited useful life over their useful life using the straight-line method and amortizes the copyrights with unlimited useful life over 5 years, which the copyrights are expected to contribute to the revenue of the Company’s online education academy App. Accounting for long-lived assets The Company classifies its long-lived assets into: (i) performance equipment, (ii) office equipment and (iii) intangible assets. Long-lived assets held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of such assets may not be fully recoverable. It is possible that these assets could become impaired as a result of technological or other industry changes. If circumstances require a long-lived asset or asset group to be tested for possible impairment, the Company first compares undiscounted cash flows expected to be generated by that asset or asset group to its carrying value. If the carrying value of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent that the carrying value exceeds its fair value. Fair value is determined through various valuation techniques, including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. If the value of an asset is determined to be impaired, the impairment to be recognized is measured in the amount by which the carrying amount of the asset exceeds the fair value of the asset. Assets to be disposed of are reported at the lower of the carrying amount or the fair value, less disposition costs. There were no impairment charges for the years ended June 30, 2022 and 2020. Impairment charges amounted to $99,943 for the year ended June 30, 2021. Competitive pricing pressures and changes in interest rates could materially and adversely affect the Company’s estimates of future net cash flows to be generated by the long-lived assets, and thus could result in future impairment losses. Accounts payable Accounts payable represents royal fees payable to the Company’s vendor which was incurred from the revenues generated of its on-demand contents in the Color World Platform. Deferred revenue Deferred revenue represents the Color World Platform subscription fees collected from its members in advance of the revenue being recognized in accordance with the Company’s revenue recognition policy as discussed above. Leases The Company accounts for leases in accordance with ASC 842 “Leases”. Operating lease right-of-use (“ROU”) assets and lease liabilities are recognized at the commencement date 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 uses 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 considers 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 operating lease ROU asset also excludes lease incentives. Lease expense is recognized on a straight-line basis over the lease term. Leases with an initial term of 12 months or less are not recorded on the balance sheet as operating lease ROU assets and lease liabilities. 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 operating lease liabilities in any tested asset group and include the associated operating lease payments in the undiscounted future pre-tax cash flows. As of June 30, 2022 and 2021, the Company does not have any lease with an initial term of more than 12 months. Research and development Research and development expenses include website or app development expenditure costs, salaries and other compensation-related expenses to the Company’s research and product development personnel and related expenses for the Company’s research and product development team. The Company expenses all costs that are incurred in connection with the planning and implementation phases of development, and costs that are associated with maintenance of the existing website or app for internal use. Stock-based compensation The Company records stock-based compensation expense for employees at fair value on the grant date and recognizes the expense over the employee’s requisite service period. The Company’s expected volatility assumption is based on the historical volatility of the Company’s stock. The expected life assumption is primarily based on historical exercise patterns and employee post-vesting termination rate. The risk-free interest rate for the expected term of an option is based on the U.S. Treasury yield curve in effect at the time of grant. The expected dividend yield is based on the Company’s current and expected dividend policy. The Company records stock-based compensation expense for non-employees at fair value on the grant date and recognizes the expense over the service provider’s requisite service period. Income taxes The Company accounts for income taxes in accordance with FASB ASC 740, “Income Taxes,” which requires the Company to use the asset and liability method of accounting for income taxes. Under the asset and liability method, deferred income taxes are recognized for the tax consequences of temporary differences by applying enacted statutory tax rates applicable to future years to differences between financial statement carrying amounts and the tax bases of existing assets and liabilities and operating loss and tax credit carry forwards. Under this accounting standard, the effect on deferred income taxes of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is recognized if it is more likely than not that some portion, or all of, a deferred tax asset will not be realized. ASC 740-10, “Accounting for Uncertainty in Income Taxes,” defines uncertainty in income taxes and the evaluation of a tax position as a two-step process. The first step is to determine whether it is more likely than not that a tax position will be sustained upon examination, including the resolution of any related appeals or litigation based on the technical merits of that position. The second step is to measure a tax position that meets the more-likely-than-not threshold to determine the amount of benefit to be recognized in the financial statements. A tax position is measured at the largest amount of benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. Tax positions that previously failed to meet the more-likely-than-not recognition threshold should be recognized in the first subsequent period in which the threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not criteria should be de-recognized in the first subsequent financial reporting period in which the threshold is no longer met. Penalties and interest incurred related to underpayment of income tax are classified as income tax expense in the period incurred. United States federal, state and local income tax returns for the years of 2019 to 2021 are subject to examination by any applicable tax authorities. Earnings (loss) per share The Company reports earnings (loss) per share in accordance with U.S. GAAP, which requires presentation of basic and diluted earnings (loss) per share in conjunction with the disclosure of the methodology used in computing such earnings per share. Basic earnings (loss) per share is computed by dividing income (loss) available to common shareholders by the weighted average common shares outstanding during the period. Diluted earnings per share takes into account the potential dilution that could occur if securities or other contracts, such as warrants, options, restricted stock-based grants and convertible preferred stock, to issue ordinary shares were exercised and converted into ordinary shares. Ordinary share equivalents having an anti-dilutive effect on earnings per share are excluded from the calculation of diluted earnings per share. Dilution is computed by applying the treasury stock method. Under this method, options and warrants are assumed to be exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby were used to purchase ordinary shares at the average market price during the period. When the Company has a loss, no potential dilutive items are included since they would be antidilutive. Stock dividends or stock splits are accounted for retroactively if the stock dividends or stock splits occur during the period, or retroactively if the stock dividends or stock splits occur after the end of the period but before the release of the financial statements, by considering it effective as of the beginning of the earliest period presented. Recent Accounting Pronouncements In January 2020, the FASB issued ASU 2020-01 to clarify the interaction of the accounting for equity securities under ASC 321 and investments accounted for under the equity method of accounting in ASC 323 and the accounting for certain forward contracts and purchased options accounted for under ASC 815. With respect to the interactions between ASC 321 and ASC 323, the amendments clarify that an entity should consider observable transactions that require it to either apply or discontinue the equity method of accounting when applying the measurement alternative in ASC 321, immediately before applying or upon discontinuing the equity method of accounting. With respect to forward contracts or purchased options to purchase securities, the amendments clarify that when applying the guidance in ASC 815-10-15-141(a), an entity should not consider whether upon the settlement of the forward contract or exercise of the purchased option, individually or with existing investments, the underlying securities would be accounted for under the equity method in ASC 323 or the fair value option in accordance with ASC 825. The ASU is effective for interim and annual reporting periods beginning after December 15, 2020. Early adoption is permitted, including adoption in any interim period. The adoption of this ASU did not have a material effect on the Company’s consolidated financial statements. The Company does not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on the Company’s consolidated financial statements. |
Business Combinations
Business Combinations | 12 Months Ended |
Jun. 30, 2022 | |
Business Combinations [Abstract] | |
Business Combinations | Note 3 – Business Combinations Acquisition and disposal of Sunway Kids In order to expand the Company’s revenue capacity, on December 31, 2019, the Company entered into a Share Exchange Agreement (“Share Exchange Agreement”) with Sunway Kids International Education Group Ltd. (“Sunway Kids”), a British Virgin Islands company, and the shareholders of Sunway Kids (the “Sellers of SK”), pursuant to which the Company will acquire all of the outstanding issued shares of Sunway Kids (the “SK Acquisition”). Pursuant to the Share Exchange Agreement, in exchange for all of the outstanding shares of Sunway Kids, the Company will issue 1,989,262 ordinary shares of the Company and pay two million U.S. dollars. On February 11, 2020, the Company, Sunway Kids and the Sellers of SK entered into an Amendment No. 1 (“Amendment 1”) to the Share Exchange Agreement. Pursuant to Amendment 1, the cash consideration will be payable to the Sellers of SK according to an earn-out schedule. On February 14, 2020, the SK Acquisition was closed and the Company issued 1,989,262 ordinary shares to the Sellers of SK. The shares had a fair value of approximately $1.9 million based on the closing market price of $0.95 per share on February, 14, 2020, the acquisition date. The total consideration was valued at approximately $3.6 million, which include approximately $1.7 million based upon a 5.8% discount rate of the $2.0 million earn-out payment schedule, and approximately $1.9 million for the shares issued. On June 25, 2020, Color Star, Sunway Kids, and the former shareholders of Sunway Kids entered into an Amendment No. 2 (“Amendment”) to the Share Exchange Agreement dated December 31, 2019, as amended. Pursuant to the Amendment 2, the Company shall not make any the Earn-out Payment to the former shareholders of Sunway Kids since Sunway Kids has been unable to conduct its normal operations due to the COVID-19 pandemic and management of Sunway Kids believes it will be very difficult to achieve its projected financial results. The Company’s acquisition of Sunway Kids was originally intended to be accounted for as a business combination in accordance with ASC 805. Due to the negative impact of COVID-19, the Company disposed of Sunway Kids (see Note 4) within the same fiscal year as Sunway Kids was unable to conduct its normal operations and achieve it business plan. In addition, due to COVID-19, the Company was unable to complete its purchase price allocation and assessment on the fair value of the identifiable assets acquired and liabilities assumed on the acquisition date in accordance with the business combination standard issued by the FASB, prior to its disposal on June 25, 2020. Acquisition of Color China On May 7, 2020, the Company entered into a Share Exchange Agreement (“Exchange Agreement”) with Color China, a Hong Kong limited company, and shareholders of Color China (the “Sellers”), pursuant to which the Company acquired all of the outstanding issued shares of Color China from the sellers (the “Acquisition”). Pursuant to the Exchange Agreement, the Company will issue 4,633,333 ordinary shares of the Company and pay an aggregate of $2.0 million to the Sellers. Immediately after the Acquisition, Color Star will own 100% of Color China. On June 3, 2020, the transaction was closed and the Company issued 4,633,333 ordinary shares of the Company to the Sellers. Color China had no business operations other than holding a collection of music performance equipment. The Company’s acquisition of Color China was accounted for as an acquisition of assets in accordance with ASC 805. The measurement is based on the fair value of the consideration given to acquire the assets (primarily performance and office equipment) held in Color China as it is more clearly evident and more reliably measurable. The total consideration given to acquire assets held in Color China at the acquisition date on June 3, 2020 were valued at approximately $4.0 million, consisted of 4,633,333 ordinary shares issued at a fair value of $1,963,607 based on the closing market price of $0.4238 per share on June 3, 2020, and cash payment of $2.0 million. |
Discontinued Operations
Discontinued Operations | 12 Months Ended |
Jun. 30, 2022 | |
Discontinued Operations [Abstract] | |
Discontinued Operations | Note 4 – Discontinued Operations Disposal of BVI-ACM The Company’s concrete business was negatively affected by the economic cycle and government policies. The concrete industry was influenced by the decline in the macro economy in recent years. The entire concrete industry in the Beijing area experienced a slowdown in industry production and economic growth in the last few years as the Beijing government continues to enforce concrete production reformation and tightened environmental laws from late 2017 to date. The reformation causes great uncertainties for local enterprises in the construction market. Since 2017, the pressure on small concrete companies has further increased and many have been shut down. Also, the Beijing government ordered the suspension of construction job sites during winters to reduce air pollution since 2017. The operations of Xin Ao were also severely affected. As a result of Xin Ao’s deteriorating cash position, it defaulted on bank loans and experienced a substantial increase in contingent liabilities. The Company believed it would be very difficult, if not impossible, to turn around the concrete business. Accordingly, the Company’s management decided to dispose of this business by actively seeking a purchaser after the acquisition of Sunway Kids. On March 31, 2020, the Company, BVI-ACM, a wholly owned subsidiary of the Company, and Mr. Xianfu Han and Mr. Weili He (the “Purchasers”), two former officers (CEO and CFO) and collectively held less than 5% ordinary shares of the Company currently, entered into a share purchase agreement (the “Disposition SPA”). Pursuant to the Disposition SPA, the Purchasers agreed to purchase BVI-ACM in exchange for cash consideration of $600,000. Upon the closing of the transaction (the “Disposition”) the Purchasers assumed all assets and liabilities of all the subsidiaries and VIE entities owned or controlled by BVI-ACM. The closing of the Disposition was completed on May 6, 2020. After disposal of BVI-ACM, the Company had no continuing involvement or commitments with BVI-ACM. The fair value of the discontinued operations of BVI-ACM, determined as of May 6, 2020, included the estimated consideration received, less costs to sell. Revenue recognition by BVI-CAM Sales of concrete products Prior to disposition of BVI-ACM, the Company derived its revenues from sales contracts with its customers with revenues being recognized upon delivery of products. Persuasive evidence of an arrangement was demonstrated via sales contract and invoice; and the sales price to the customer was fixed upon acceptance of the sales contract and there was no separate sales rebate, discount, or other incentive. Such revenues were recognized at a point in time after all performance obligations were satisfied and based on when control of goods was transferred to a customer. Reconciliation of the amounts of major classes of income and losses from discontinued operations in the consolidated statements of operations and comprehensive loss for the year ended June 30, 2020 are as follows: For the 2020 Revenue $ 28,747,362 Cost of revenue 26,553,802 Gross profit 2,193,560 OPERATING EXPENSES: Provision for doubtful accounts (8,385,084 ) Selling, general and administrative expenses (3,484,700 ) Research and development expenses (139,780 ) Total operating expenses (12,009,564 ) Loss from operations (9,816,004 ) OTHER INCOME (EXPENSES) Other expenses, net 1,872 Interest income 235 Interest expense (1,783,833 ) Finance expense (825 ) Estimated claims charges (591,884 ) Total other expense, net (2,374,435 ) Loss before income taxes (12,190,439 ) Income tax expense - Net loss from discontinued operations $ (12,190,439 ) As of May 6, 2020, the net assets of discontinued operations and reconciliation of gain on sale of discontinued operations of BVI-ACM are as follows: May 6, CURRENT ASSETS: Cash and cash equivalents $ 222,591 Accounts and notes receivable, net 28,598,318 Inventories 77,049 Other receivables, net 1,815,307 Other receivables – related party 160,505 Prepayments and advances, net 15,077,736 Prepayment – related party 247,598 Total current assets 46,199,104 OTHER ASSETS: Property, plant and equipment, net 795,974 Operating lease right-of-use assets 1,031,940 Total other assets 1,827,914 Total assets $ 48,027,018 CURRENT LIABILITIES: Short-term loan - bank $ 23,996,261 Accounts payable 16,158,660 Customer deposits 888,592 Other payables 23,197,053 Other payables – related parties 6,541 Accrued liabilities 5,143,410 Operating lease liabilities- current 291,228 Taxes payable 154,680 Accrued contingent liabilities 6,997,071 Total current liabilities 76,833,496 OTHER LIABILITIES: Operating lease liabilities - noncurrent 595,086 Total other liabilities 595,086 Total liabilities $ 77,428,582 Total net deficit $ 29,401,564 Additional paid-in-capital carryover (13,128,249 ) Retained earnings carryover (7,486,219 ) Total consideration received 600,000 Exchange rate effect (2,764,813 ) Total gain on sale of discontinued operations $ 6,622,283 Disposal of Sunway Kids On June 25, 2020, the Company, Sunway Kids and Mr. Yanliang Han (the “SK Purchaser”), an unrelated third party, entered into a share purchase agreement (the “Disposition SPA”). Pursuant to the Disposition SPA, the SK Purchaser agreed to purchase Sunway Kids in exchange for cash consideration of $2.4 million. Upon closing of the transaction, the SK Purchaser became the sole shareholder of Sunway Kids and as a result, assumed all assets and liabilities of all the subsidiaries and variable interest entities (the “VIE”) owned or controlled by Sunway Kids. The SK Purchaser settled $1.0 million of its payment obligation in November 2020 through a tri-party settlement agreement executed on September 29, 2020 among the Company, SK Purchaser and the Asset Seller. Although the SK Purchaser is current with its installment payment, the Company will recognize the remaining installment payment on a cash basis as collectability of the remaining $1.4 million cannot be reasonably assured. During the year ended June 30, 2021, the Company received the remaining $1.4 million. The disposition of Sunway Kids resulted in the recognition of a gain (loss) of approximately $1.4 million and $(0.8) million that is recorded in the accompanying consolidated statements of operations and comprehensive income (loss) in the caption of “gain (loss) from discontinued operations” during the years ended June 30, 2021 and 2020, respectively. The reconciliation of loss on sale of discontinued operations of Sunway Kids are as follows: June 25, Total consideration paid $ 3,583,952 Forgiven of fair value of earn out payment (1,694,153 ) Expenses incurred from February 14 to June 25, 2020 (54,729 ) Total consideration received (1,000,000 ) Total loss on sale of discontinued operations $ 835,070 Revenue recognition by Sunway Kids While owned by the Company, Sunway Kids was in the business of delivering artificial intelligence lessons for kids and it earned tuition fees in connection with lessons completed. Each lesson would be accounted for as a single performance obligation and tuition revenue would be recognized proportionately as the lessons are delivered. Tuition fees were generally collected in advance and would be initially recorded as deferred revenue. Refund for any remaining lessons (which amount is limited to the amount related to the undelivered classes) is offered to students who decide to withdraw from a lesson. Due to the COVID-19 pandemic, Sunway Kids had no business operations and did not earn any revenue from February 14, 2020 to June 25, 2020 as management was unable to conduct its normal operations. |
Accounts Receivable
Accounts Receivable | 12 Months Ended |
Jun. 30, 2022 | |
Accounts receivable [Abstract] | |
Accounts receivable | Note 5 – Accounts receivable Accounts receivable consisted of the following: June 30, June 30, Color World platform subscription fees due from App payment collections agent $ 2,507,981 $ 3,191,711 No |
Other Receivables
Other Receivables | 12 Months Ended |
Jun. 30, 2022 | |
Other Receivables Net [Abstract] | |
Other receivables | Note 6 – Other receivables Other receivables consisted of the following: June 30, June 30, Rent deposit $ - $ 8,900 Receivable from sale of equipment 6,819,050 - Other receivables $ 6,819,050 $ 8,900 |
Prepayments
Prepayments | 12 Months Ended |
Jun. 30, 2022 | |
Prepayments [Abstract] | |
Prepayments | Note 7 – Prepayments Prepayments, current, consisted of the following: June 30, June 30, Prepayment for online concert productions $ 8,000,000 $ 1,648,000 Prepayment for live concert productions 5,000,000 - Prepayment for advertisement 4,666,664 - Prepayment for program license fees - 2,615,527 Prepayment for rent - 4,300 Prepayments and advances $ 17,666,664 $ 4,267,827 Prepayments, non-current, consisted of the following: June 30, June 30, Prepayment for software development expenditure $ - $ 52,000,000 |
Property, Plant and Equipment,
Property, Plant and Equipment, Net | 12 Months Ended |
Jun. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment, Net | Note 8 – Property, plant and equipment, net Property, plant and equipment consist of the following: June 30, June 30, Performance equipment $ - $ 10,637,926 Office equipment 39,602 38,477 Total 39,602 10,676,403 Less: Accumulated depreciation (9,374 ) (1,516,189 ) Property, plant and equipment, net $ 30,228 $ 9,160,214 Depreciation expense was $1,445,573, $1,536,178 and $0 for the years ended June 30, 2022, 2021 and 2020, respectively. During the year ended June 30, 2022, the Company disposed all of its performance equipment which resulted in a gain on disposal of $94,984. Due the epidemic has resulted in quarantines and travel and event restrictions throughout the world, the Company did not successfully host any live concerts since 2020. As a result, the Company decided to dispose its performance equipment by utilizing the cash to be realized from the equipment disposal as operating cash flows. |
Intangible Assets, Net
Intangible Assets, Net | 12 Months Ended |
Jun. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible assets, net | Note 9 – Intangible assets, net Intangible assets consist of the following: June 30, June 30, Copyrights of online education academy courses $ 32,198,770 $ 14,453,243 Less: Accumulated amortization (6,631,812 ) (2,180,917 ) Carrying amount $ 25,566,958 $ 12,272,326 Amortization expense was $4,450,895, $2,180,917 and $0 for the years ended June 30, 2022, 2021 and 2020, respectively. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Jun. 30, 2022 | |
Related Party Transactions [Abstract] | |
Related party transactions | Note 10 – Related party transactions Other payables – related parties Other payables – related party consisted of the following: Name of Relationship Nature June 30, June 30, Weili He Former Chief Financial Officer (“CFO”) of the Company who held less than 5% of the Company ordinary shares currently Salary Payable $ 10,711 $ 10,711 Hui Xu General Manager of CACM Interest-free loan, due on demand 350,000 - Jehan Zeb Khan Director and Former Co-Acting CEO of the Company Interest-free loan, due on demand 2,173 - Total $ 362,884 $ 10,711 |
Accounts payable
Accounts payable | 12 Months Ended |
Jun. 30, 2022 | |
Payables and Accruals [Abstract] | |
Accounts payable | Note 11 – Accounts payable June 30, June 30, Royal fees payable $ 3,770,945 $ - |
Deferred Revenue
Deferred Revenue | 12 Months Ended |
Jun. 30, 2022 | |
Deferred Revenue [Abstract] | |
Deferred revenue | Note 12 – Deferred revenue June 30, June 30, Color World platform subscription fees collected in advance of revenue recognition $ - $ 3,596,821 |
Leases
Leases | 12 Months Ended |
Jun. 30, 2022 | |
Leases [Abstract] | |
Leases | Note 13 – Leases The Company determines if a contract contains a lease at inception. US GAAP requires that the Company’s leases be evaluated and classified as operating or finance leases for financial reporting purposes. The classification evaluation begins at the commencement date and the lease term used in the evaluation includes the non-cancellable period for which the Company has the right to use the underlying asset, together with renewal option periods when the exercise of the renewal option is reasonably certain and failure to exercise such option which result in an economic penalty. The Company has a lease agreement for office space in New York from June 1, 2020 through May 31, 2021, with annual payments of $46,896 and converted to month to month lease in June 2021 and terminated the month to month lease on October 2021. The Company has a new lease agreement for office space in New York from July 1, 2021 through June 30, 2022, with a rental fee of $3,300 per month. In May 2022, the Company entered another lease agreement for office space in New York from July 1, 2022 through June 30, 2023, with a rental fee of $2,886 per month. The Company did not recognize the operating lease ROU assets and lease liabilities on the balance sheet as this lease has an initial term of 12 months or less. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. The leases generally do not contain options to extend at the time of expiration. The one-year maturity of the Company’s lease obligations is presented below: Year Ending June 30, Operating Lease Amount 2023 $ 34,626 Total lease payments $ 34,626 Operating lease expenses are included in general and administrative expenses. Total operating lease expenses were approximately $65,580, $71,000 and $30,000 for the years ended June 30, 2022, 2021 and 2020, respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Jun. 30, 2022 | |
Income Taxes [Abstract] | |
Income taxes | Note 14 – Income taxes (a) Corporate income tax Color Star Under the current laws of the Cayman Islands, Color Star is not subject to tax on income or capital gains. Additionally, upon payments of dividends to the shareholders, no Cayman Islands withholding tax will be imposed. CACM CACM is organized in the New York State in the United States. CACM had no taxable income for the U.S. income tax purposes for the years ended June 30, 2022, 2021 and 2020. The applicable tax rate is 21.0% for federal and 7.1% for New York State with an effective tax rate of 26.6%. Color Sky and Modern Pleasure Color Sky and Modern Pleasure are organized in Hong Kong and is subject to Hong Kong Profits Tax on the taxable income as reported in its statutory financial statements adjusted in accordance with relevant Hong Kong tax laws. The applicable tax rate is 16.5% in Hong Kong. The Company did not make any provisions for Hong Kong Profits Tax as there were no assessable profits derived from or earned in Hong Kong since inception. Under Hong Kong tax law, Color Sky is exempted from income tax on its foreign-derived income and there are no withholding taxes in Hong Kong on remittance of dividends. Income (loss) before provision for income taxes consisted of: For the For the For the Cayman $ (8,837,141 ) $ (7,120,310 ) $ (4,851,668 ) United States (617,057 ) (541,744 ) (316,142 ) Hong Kong (67,753,920 ) (576,459 ) (832 ) $ (77,208,118 ) $ (8,238,513 ) $ (5,168,642 ) The following table reconciles the U.S. statutory rates to the Company’s effective tax rate for the years ended June 30, 2022, 2021 and 2020: For the For the For the Federal statutory rate 21.0 % 21.0 % 21.0 % State statutory rate 5.6 % 5.6 % 5.6 % Valuation allowance (26.6 )% (26.6 )% (26.6 )% Effective tax rate 0.0 % 0.0 % 0.0 % Significant components of deferred tax assets were as follows: June 30, June 30, Deferred tax assets Net operating loss carryforward in the U.S. 442,051 278,531 Net operating loss carryforward in Hong Kong 11,274,650 95,253 Valuation allowance (11,716,701 ) (373,784 ) Total net deferred tax assets $ - $ - As of June 30, 2022 and 2021, CACM’s net operating loss carry forward for the U.S. income taxes was approximately $1.5 million and $0.9 million, receptively. The net operating loss carry forwards are available to reduce future years’ taxable income for unlimited years but limited to 80% use per year. Management believes that the realization of the benefits from these losses appears uncertain due to the Company’s operating history and continued losses in the U.S. If the Company is unable to generate taxable income in its United States operations, it is more likely than not that it will not have sufficient income to utilize its deferred tax assets. Accordingly, the Company has provided a 100% valuation allowance on its net deferred tax assets of approximately $442,000 and $279,000 related to its U.S. operations as of June 30, 2022 and 2021, respectively. As of June 30, 2022 and 2021, Color Sky and Modern Pleasure’s net operating loss carry forward for the Hong Kong income taxes was approximately $0.3 million and $0.6 million, receptively. The net operating loss carry forwards are available to reduce future years’ taxable income for unlimited years. Management believes that the realization of the benefits from these losses appears uncertain due to the Company’s operating history and continued losses in Hong Kong. If the Company is unable to generate taxable income in its Hong Kong operations, it is more likely than not that it will not have sufficient income to utilize its deferred tax assets. Accordingly, the Company has provided a 100% valuation allowance on its net deferred tax assets of approximately $11.3 million and $95,000 related to its Hong Kong operations as of June 30, 2022 and 2021, respectively. Changes in the valuation allowance for deferred tax assets increased by $11,342,917 from $373,784 on June 30, 2021 to $11,716,701 on June 30, 2022. Changes in the valuation allowance for deferred tax assets increased by $239,269 from $134,515 on June 30, 2020 to $373,784 on June 30, 2021. (b) Uncertain tax positions There were no uncertain tax positions as of June 30, 2022 and 2021, and management does not anticipate any potential future adjustments which would result in a material change to its tax positions. For the years ended June 30, 2022, 2021 and 2020, the Company did not incur any tax related interest or penalties. |
Shareholders_ Equity
Shareholders’ Equity | 12 Months Ended |
Jun. 30, 2022 | |
Stockholders' Equity Note [Abstract] | |
Shareholders’ equity | Note 15 – Shareholders’ equity Increase in Authorized Shares and Shares Reverse Split On November 18, 2020, the Company’s shareholders approved to the authorized share capital of the Company be increased from US$75,000 divided into 75,000,000 ordinary shares of a par value of US$0.001 each to US$200,000 divided into 200,000,000 ordinary shares of a par value of US$0.001 each by the creation of an additional 125,000,000 ordinary shares of a par value of US$0.001 each to rank pari passu in all respects with the existing ordinary shares. On December 1, 2021, the Company’s shareholders approved to the authorized share capital of the Company be increased from US$200,000 divided into 200,000,000 ordinary shares of a par value of US$0.001 each to US$800,000 divided into 800,000,000 ordinary shares of a par value of US$0.001 each by the creation of an additional 600,000,000 ordinary shares of a par value of US$0.001 each to rank pari passu in all respects with the existing ordinary shares. On March 10, 2022, the Board of Directors of the Company approved the 40-for-1 reverse share split of its ordinary shares in accordance with Cayman law and on April 11, 2022, the Company’s shareholders approved the proposal to implement a reverse share split of the Company’s ordinary shares, par value US$0.001 per share, including the Company’s ordinary shares reserved for issuance (the “Original Ordinary Shares”), at a ratio of forty (40)-for-one and at a time during the following six months to be determined by further action of our Board of Directors (or not at all in the determination of the Board of Directors during the same period), such that each 40 Original Ordinary Shares shall be consolidated into one ordinary share of the Company, par value US$0.04 (the “Adjusted Ordinary Shares”), and that the authorized share capital of the Company is consolidated from US$800,000 divided into 800,000,000 Original Ordinary Shares to US$800,000 divided into 20,000,000 Adjusted Ordinary Shares. The Company’s shareholders also approved the proposal to increase the authorized share capital of the Company at a time during the following six months to be determined by further action of the Company’s Board of Directors (or not at all in the determination of the Board of Directors during the same period) from US$800,000 divided into 20,000,000 Adjusted Ordinary Shares to US$32,000,000 divided into 800,000,000 Adjusted Ordinary Shares by the creation of an additional 780,000,000 Adjusted Ordinary Shares to rank pari passu in all respects with the Adjusted Ordinary Shares existing upon approval of the Reverse Split Proposal. The increase in authorized shares and shares reverse split became effective on September 26, 2022. All share amounts have been retroactively restated to reflect increase in authorized shares and shares reverse split. Upon execution of the 40-for-1 reverse share stock split, the Company recognized additional 25,756 ordinary shares due to round up adjustment. Sale of Ordinary Shares In January 2020, the Company sold 50,000 ordinary shares at $40.00 per share for total proceeds of $2.0 million to a third-party. The issuance was completed pursuant to the exemption from registration provided by Regulation S promulgated under the Securities Act of 1933, as amended. In March 2020, the Company sold 68,182 ordinary shares at $22.00 per share for total proceeds of approximately $1.3 million, net of offering cost of approximately $0.2 million to certain institutional investors. The issuance was completed pursuant to the exemption from registration provided by Regulation S promulgated under the Securities Act of 1933, as amended. In May 2020, the Company sold 65,000 ordinary shares at $22.00 per share for total proceeds of approximately $1.2 million, net of offering cost of approximately $0.2 million to certain institutional investors. The issuance was completed pursuant to the exemption from registration provided by Regulation S promulgated under the Securities Act of 1933, as amended. In July 2020, the Company sold 80,625 ordinary shares and warrants to purchase up to 52,407 ordinary shares with an exercise price of $52.00 for total proceeds of approximately $3.8 million, net of offering cost of approximately $0.4 million to certain institutional investors. The purchase price for each share and the corresponding warrant is $60.00. The issuance was completed pursuant to the exemption from registration provided by Regulation S promulgated under the Securities Act of 1933, as amended. In September 2020, the Company entered into an agreement to sell a Purchaser an aggregate of up to 79,366 ordinary shares for gross proceeds of up to approximately $2 million. The shares shall be issued in four separate installments. The first installment of $500,000 worth of shares, or 19,842 shares to be issued at $25.20 per share, was closed on September 9, 2020. The Company also agreed to issue 794 Ordinary Shares to the Purchaser as additional consideration for the purchase of the shares on September 9, 2020. The Company received total proceeds of $460,000, net of offering cost of $40,000 for the first installment. The issuance was completed pursuant to the exemption from registration provided by Regulation S promulgated under the Securities Act of 1933, as amended. As of the date of this report, the Company is not certain that the Purchaser will proceed with the remaining three installments. In September 2020, the Company sold 330,000 ordinary shares and warrants to purchase up to 297,000 ordinary shares with an exercise price of $20.00 for total proceeds of approximately $6.0 million, net of offering cost of approximately $0.6 million to certain institutional investors. The purchase price for each share and the corresponding warrant is $22.00. The issuance was completed pursuant to the exemption from registration provided by Regulation S promulgated under the Securities Act of 1933, as amended. On February 18, 2021, the Company entered into certain securities purchase agreement (the “SPA”) with certain non-U.S. Persons (the “Purchasers”) as defined in Regulation S of the Securities Act of 1933, as amended pursuant to which the Company agreed to sell an aggregate of 500,000 units. Each unit consists of one restrictive ordinary share of the Company, par value $0.04 per share and a warrant to purchase one share with an initial exercise price of $53.60 per share, at a price of $52.00 per unit, for an aggregate purchase price of $26,000,000 (the “Offering”). The warrants are exercisable immediately upon the date of issuance at an initial exercise price of $1.34 per share, for cash (the “Warrant Shares”). The warrants may also be exercised cashlessly if at any time after the three-month anniversary of the issuance date, there is no effective registration statement registering, or no current prospectus available for, the resale of the Warrant Shares. The Warrants shall expire three years from its date of issuance. The warrants are subject to customary anti-dilution provisions reflecting stock dividends and splits or other similar transactions. The net proceeds of the Offering were used to upgrade the Company’s software application, or Color Star APP, with artificial intelligence, augmented reality, and mixed reality technologies. On March 25, 2021, the Company entered into a Securities Purchase Agreement (the “First Purchase Agreement”) with Wang MinYe (the “First Purchaser”), pursuant to which the Company agreed to sell to the First Purchaser in a private placement 75,500 ordinary shares (the “Wang Shares”) of the Company, par value $0.04 per share, at a purchase price of $52.00 per share for an aggregate offering price of $3,900,000 (the “First Private Placement”). The First Private Placement will be completed pursuant to the exemption from registration provided by Regulation S promulgated under the Securities Act of 1933, as amended. On March 25, 2021, the Company entered into a Securities Purchase Agreement (the “Second Purchase Agreement”) with Lin YiHan (the “Second Purchaser”), pursuant to which the Company agreed to sell to the Second Purchaser in a private placement 87,500 ordinary shares (the “Lin Shares”) of the Company, par value $0.04 per share, at a purchase price of $52.00 per share for an aggregate offering price of $4,550,000 (the “Second Private Placement”). The Second Private Placement will be completed pursuant to the exemption from registration provided by Regulation S promulgated under the Securities Act of 1933, as amended. On March 27, 2021, the Company entered into a Securities Purchase Agreement (the “Third Purchase Agreement”) with Zubair Ahsan (the “Third Purchaser”), pursuant to which the Company agreed to sell to the First Purchaser in a private placement 75,000 ordinary shares of the Company, par value $0.04 per share, at a purchase price of $52.00 per share for an aggregate offering price of $3,900,000 (the “Third Private Placement”). The Third Private Placement will be completed pursuant to the exemption from registration provided by Regulation S promulgated under the Securities Act of 1933, as amended. On March 27, 2021, the Company entered into a Securities Purchase Agreement (the “Fourth Purchase Agreement”) with Ullah Sabar (the “Fourth Purchaser”), pursuant to which the Company agreed to sell to the Second Purchaser in a private placement 87,500 ordinary shares of the Company, par value $0.04 per share, at a purchase price of $52.00 per share for an aggregate offering price of $4,550,000 (the “Fourth Private Placement”). The Fourth Private Placement will be completed pursuant to the exemption from registration provided by Regulation S promulgated under the Securities Act of 1933, as amended. On March 27, 2021, the Company entered into a Securities Purchase Agreement (the “Fifth Purchase Agreement”) with Li Yan (the “Fifth Purchaser”), pursuant to which the Company agreed to sell to the Fifth Purchaser in a private placement 87,500 ordinary shares of the Company, par value $0.04 per share, at a purchase price of $52.00 per share for an aggregate offering price of $4,550,000 (the “Fifth Private Placement”). The Fifth Private Placement will be completed pursuant to the exemption from registration provided by Regulation S promulgated under the Securities Act of 1933, as amended. On March 27, 2021, the Company entered into a Securities Purchase Agreement (the “Sixth Purchase Agreement”) with Ahmed Muhammad Abrar (the “Sixth Purchaser”), pursuant to which the Company agreed to sell to the Sixth Purchaser in a private placement 87,500 ordinary shares of the Company, par value $0.04 per share, at a purchase price of $52.00 per share for an aggregate offering price of $4,550,000 (the “Sixth Private Placement”). The Sixth Private Placement will be completed pursuant to the exemption from registration provided by Regulation S promulgated under the Securities Act of 1933, as amended. On September 24, 2021, the Company and certain institutional investors entered into a securities purchase agreement (“SPA 1”), pursuant to which the Company agreed to sell such institutional investors units with each unit consisting of one ordinary share and one warrant to purchase 0.7 ordinary share, at a purchase price of $27.20 per unit, for net proceeds of approximately $19.2 million (the “Offering”). An aggregate of 790,624 ordinary shares and warrants to purchase an aggregate of 553,437 ordinary shares (the “Investor Warrants”) were agreed to be issued to the investors under the SPA 1. The Offering closed on September 28, 2021. On January 21, 2022, the Company and Hou Sing International Business Limited (“Hou Sing”) entered into a securities purchase agreement, pursuant to which the Company agreed to issue and sell to Hou Sing an aggregate of 400,000 ordinary shares at a purchase price of $40.00 per share, for proceeds of $16.0 million. On February 21, 2022, the Company and certain institutional investors entered into a securities purchase agreement (“SPA 2”), pursuant to which the Company agreed to sell such institutional investors units with each unit consisting of one ordinary share and one warrant to purchase one ordinary share, at a purchase price of $16.00 per unit, for net proceeds of approximately $8.7 million (the “Offering”). An aggregate of 625,000 ordinary shares and warrants to purchase an aggregate of 625,000 ordinary shares (the “Investor Warrants”) were agreed to be issued to the investors under the SPA 2. The Offering closed on February 24, 2022. Restricted Stock Grants Restricted stock grants are measured based on the market price on the grant date. The Company has granted restricted ordinary shares to the members of the board of directors (the “Board”), senior management and consultants. In May 2020, the Board granted 4,500 restricted ordinary shares, which were issued with a fair value of $84,600 to the Company’s former CEO/Vice President of Technology. The Board approved that these shares were all vested in October 2020 when the Company’s former CEO/Vice President of Technology left the Company. In July 2020, the Board granted an aggregate of 7,500 restricted ordinary shares, which were issued with a fair value of $522,000 to the current Co-Acting CEO (“Co-Acting CEO”) of the Company. These shares will vest quarterly over the required service period of one year starting from July 17, 2020 to July 16, 2021. In June 2021, the Board granted an aggregate of 10,000 restricted ordinary shares, which were issued with a fair value of $11,200 to Mr. Basil Wilson, the former CEO, and to Mr. Biao Lu, the current Co-Acting CEO, of the Company. These shares will vest quarterly over the required service period of one year starting from June 16, 2021 to June 15, 2022. On December 13, 2021, Basil Wilson resigned from his positions as the CEO and chairman of the board of directors. As a result, he had forfeited 3,750 unvested restricted ordinary shares with an initial fair value of $168,000. In December 2021, the Board granted an aggregate of 2,500 restricted ordinary shares, which were issued with a fair value of $45,900 to Sir Lucas Capetian, the former CEO. These shares will vest quarterly over the required service period of one year starting from December 13, 2021 to December 12, 2022. In March 2022, all of these shares were deemed fully vested upon the approval by the Compensation Committee of the Board of Directors of the Company. In April 2022, the Company granted an aggregate of 3,000 restricted ordinary shares, which were issued with a fair value of $27,360 to Ms. Lili Jiang, the Company’s CFO, pursuant to her employment contract. These shares will vest quarterly over the required service period of one year starting from April 1, 2022 to December 12, 2023. In June 2022, the Company granted an aggregate of 2,500 restricted ordinary shares, which were issued with a fair value of $13,000 to Mr. Biao Lu, the Company’s CAO, pursuant to his employment contract. These shares will vest quarterly over the required service period of one year starting from June 16, 2022 to June 15, 2023. For the years ended June 30, 2022, 2021 and 2020, the Company recognized approximately $0.6 million, $1.1 million and $0.6 million compensation expense related to restricted stock grants, respectively. Following is a summary of the restricted stock grants: Restricted stock grants Shares Weighted Aggregate Unvested as of June 30, 2019 16,500 $ 102.80 $ - Granted 4,500 $ 102.80 - Granted - $ 18.80 - Vested (7,125 ) $ 211.20 - Unvested as of June 30, 2020 13,875 $ 82.40 $ - Forfeited (3,000 ) $ 2.57 - Granted 17,500 $ 55.60 - Vested (16,229 ) $ 74.80 - Unvested as of June 30, 2021 12,146 $ 56.00 - Forfeited (3,750 ) $ 44.80 - Granted 8,000 $ 10.80 - Vested (11,750 ) $ 48.40 - Unvested as of June 30, 2022 4,646 $ 7.20 - Ordinary Shares Issued for Compensation In December 2020, the Board granted an aggregate of 39,750 ordinary shares, which were issued with a fair value of $1,128,900, determined using the closing price of $28.40 on December 24, 2020, to thirteen employees under the 2019 Plan. These shares vested immediately upon grant. In January 2021, the Board granted an aggregate of 54,000 ordinary shares, which were issued with a fair value of $1,836,000, determined using the closing price of $34.00 on January 28, 2021, to thirteen employees under the 2019 Plan. These shares vested immediately upon grant. In March 2021, the Board granted an aggregate of 34,500 ordinary shares, which were issued with a fair value of $1,131,600, determined using the closing price of $32.80 on March 16, 2021, to nine employees under the 2019 Plan. These shares vested immediately upon grant. In August 2021, the Board granted an aggregate of 93,875 ordinary shares, which were issued with a fair value of $3,030,285, determined using the closing price of $32.28 on August 9, 2021, to twenty-one employees under the 2021 Plan. These shares vested immediately upon grant. In March 2022, the Board granted an aggregate of 106,250 ordinary shares, which were issued with a fair value of $1,134,750, determined using the closing price of $10.68 on March 18, 2022, to twenty employees under the 2021 Plan. These shares vested immediately upon grant. For the years ended June 30, 2022, 2021 and 2020, the Company recorded approximately $4.2 million, $4.1 million and $1.3 million stock compensation expense related to ordinary shares grants, respectively. Ordinary Shares Issued for Services In July 2019, the Board granted an aggregate of 10,000 ordinary shares with a fair value of $1,400,000, determined using the closing price of $140.00 on July 19, 2019, to two service providers. The value of these shares is being amortized over the service period of one year starting from July 1, 2019. In October 2020, the Board granted an aggregate of 17,500 ordinary shares with a fair value of $441,000, determined using the closing price of $25.20 on October 15, 2020, to two service providers. The value of these shares is being amortized over the service from October 15, 2020 to February 10, 2021. For the years ended June 30, 2022, 2021 and 2020, the Company amortized approximately $0, $0.5 million and $2.8 million stock compensation expense related to services, respectively. Ordinary Shares Issued for Debt Repayment In January 2020, Hou Sing entered into certain loan assignment agreements with Ms. Na Wang and Ms. Wei Zhang, employees of the Company who previously loaned money to Xin Ao in the aggregate amount of RMB29,429,627 (approximately $4.3 million) and delivered the full payment to the two employees. In March 2020, the Company issued an aggregate of 69,228 ordinary shares of the Company to Hou Sing. In January 2020, the Board approved the conversion of debt in the aggregate amount of $976,255 that Xin Ao owed to Mr. Xianfu Han, the former Chief Executive Officer of the Company, Ms. Weili He, the former Chief Financial Officer of the Company, and Ms. Wei Zhang, an employee of the Company at the time, at a per share conversion price of $61.60. In March 2020, the Company issued an aggregate of 15,849 ordinary shares of the Company to Mr. Xianfu Han, Ms. Weili He and Ms. Wei Zhang. In April 2020, the Company issued 6,908 ordinary shares to Hou Sing, the Company’s shareholder, to repay the debt owed to him. Ordinary Shares Issued for Acquisitions In February 2020, the Company issued 49,732 ordinary shares to the shareholders of Sunway Kids and the ordinary shares issued valued using the closing price of the Company’s ordinary shares on February 14, 2020 at $38.00 per share. See Note 3 – Business Combinations. In June 2020, the Company issued 115,834 ordinary shares of the shareholders of Color Sky and the ordinary shares issued valued using the closing price of the Company’s ordinary shares on June 3, 2020 at $17.00 per share. See Note 3 – Business Combinations. In August 2020, the Company issued 151,508 ordinary shares to a third party to purchase certain machinery and equipment for stage performance and the ordinary shares were valued using the closing price of the Company’s ordinary shares on August 20, 2020 at $25.20 per share. In February 2021, the Company issued 45,371 ordinary shares to a third party to purchase certain copyrights to be used in the Company’s Color World platform and the ordinary shares were valued using the closing price of the Company’s ordinary shares on January 29, 2021, last trading day prior to the acquisition at $34.00 per share. Conversion of Warrants into Ordinary Shares During the year ended June 30, 2021, the Company’s warrants holders converted a total of 341,432 warrants into a total of 341,432 ordinary shares at a weighted exercise price of $15.2 per share for gross proceeds of approximately $5.2 million. During the year ended June 30, 2022, the Company’s warrants holders converted a total of 3,775 warrants into a total of 3,775 ordinary shares at a weighted exercise price of $8.34 per share for gross proceeds of approximately $31,000. Warrants In a connection with the direct offering in March 2020 with the sales of 68,182 ordinary shares, the Company also sold warrants (“Direct Offering Warrants”) to purchase an aggregate of up to an aggregate of 68,182 ordinary shares to certain institutional investors on April 2, 2020. The warrants are exercisable immediately, at an exercise price of $22.00 per Ordinary Share and expire 5.5 years from the date of issuance. The fair value of this Direct Offering Warrants was $916,334, which was considered a direct cost of the direct offering and included in additional paid-in capital. The fair value has been estimated using the Black-Scholes pricing model with the following assumptions: market value of underlying share of $16.40, risk free rate of 0.43%; expected term of 5.5 years; exercise price of the warrants of $22.00, volatility of 120%; and expected future dividends of 0%. In June 2020, the exercise price of the warrants was amended and changed to $1.60 per Ordinary Share as a result of the May 13, 2020 direct offering. In a connection with the private placement in May 2020 for the sale of 65,000 ordinary shares, the Company also sold warrants (“Direct Offering Warrants”) to purchase an aggregate of up to an aggregate of 65,000 ordinary shares to certain institutional investors on May 11, 2020. The warrants are exercisable immediately, at an exercise price of $22.00 per Ordinary Share and expire 5.5 years from the date of issuance. The fair value of this Direct Offering Warrants was $860,826, which was considered a direct cost of the direct offering and included in additional paid-in capital. The fair value has been estimated using the Black-Scholes pricing model with the following assumptions: market value of underlying share of $16.0, risk free rate of 0.36%; expected term of 5.5 years; exercise price of the warrants of $22.00, volatility of 123%; and expected future dividends of 0%. In August 2020, the exercise price of the warrants was amended and changed to $7.40 per Ordinary Share as a result of the July 20, 2020 direct offering. In a connection with the private placement in July 2020 for the sale of 80,625 ordinary shares, the Company also sold warrants (“Direct Offering Warrants”) to purchase an aggregate of up to an aggregate of 52,406 ordinary shares to certain institutional investors on July 20, 2020. The warrants are exercisable immediately, at an exercise price of $60.00 per Ordinary Share and expire 5.5 years from the date of issuance. The fair value of this Direct Offering Warrants was $2,901,119, which was considered a direct cost of the direct offering and included in additional paid-in capital. The fair value has been estimated using the Black-Scholes pricing model with the following assumptions: market value of underlying share of $63.60, risk free rate of 0.34%; expected term of 5.5 years; exercise price of the warrants of $60.00, volatility of 128%; and expected future dividends of 0%. In a connection with the private placement in September 2020 for the sale of 330,000 ordinary shares, the Company also sold warrants (“Direct Offering Warrants”) to purchase an aggregate of up to an aggregate of 297,000 ordinary shares to certain institutional investors on September 15, 2020. The warrants are exercisable immediately, at an exercise price of $22.00 per Ordinary Share and expire 5.5 years from the date of issuance. The fair value of this Direct Offering Warrants was $8,403,557, which was considered a direct cost of the direct offering and included in additional paid-in capital. The fair value has been estimated using the Black-Scholes pricing model with the following assumptions: market value of underlying share of $31.60, risk free rate of 0.32%; expected term of 5.5 years; exercise price of the warrants of $22.00, volatility of 130%; and expected future dividends of 0%. On February 18, 2021, the Company entered into certain securities purchase agreement (the “SPA”) with certain non-U.S. Persons (the “Purchasers”) as defined in Regulation S of the Securities Act of 1933, as amended pursuant to which the Company agreed to sell an aggregate of 500,000 units. Each unit consists of one restrictive ordinary share of the Company and a warrant (“SPA Warrants”) to purchase one share with an initial exercise price of $53.60 per share. The SPA Warrants are exercisable immediately upon the date of issuance at an initial exercise price of $53.60 per Share, for cash (the “Warrant Shares”). The SPA Warrants may also be exercised cashlessly if at any time after the three-month anniversary of the issuance date, there is no effective registration statement registering, or no current prospectus available for, the resale of the Warrant Shares. The SPA Warrants shall expire three years from its date of issuance. The SPA Warrants are subject to customary anti-dilution provisions reflecting stock dividends and splits or other similar transactions. The SPA Warrants are exercisable immediately, at an exercise price of $53.60 per Ordinary Share and expire 3.0 years from the date of issuance. The fair value of the SPA Warrants was $15,898,047, which was considered a direct cost of the sale of SPA and included in additional paid-in capital. The fair value has been estimated using the Black-Scholes pricing model with the following assumptions: market value of underlying share of $42.40, risk free rate of 0.21%; expected term of 3.0 years; exercise price of the warrants of $53.60, volatility of 141%; and expected future dividends of 0%. On September 24, 2021, the Company and certain institutional investors entered into a SPA 1, pursuant to which the Company agreed to sell such institutional investors units with each unit consisting of one ordinary share and one warrant to purchase 0.7 ordinary share, at a purchase price of $27.20 per unit, for net proceeds of approximately $19.2 million (the “Offering”). An aggregate of 790,624 ordinary shares and warrants to purchase an aggregate of 553,437 ordinary shares (the “Investor Warrants”) were agreed to be issued to the investors under the SPA 1. The Company issued a warrant to purchase 23,719 ordinary shares to the placement agent (the “Placement Agent Warrants”). The Investor Warrants and Placement Agent Warrants are initially exercisable at $40.00 per Ordinary Share and expire 3.0 years from the date of issuance. The fair value of the Investor Warrants and Placement Agent Warrants were $9,123,701, which was considered a direct cost of the sale of SPA and included in additional paid-in capital. The fair value has been estimated using the Black-Scholes pricing model with the following assumptions: market value of underlying share of $22.40, risk free rate of 0.55%; expected term of 3.0 years; exercise price of the warrants of $40.00, volatility of 140%; and expected future dividends of 0%. On February 21, 2022, the Company and certain institutional investors entered into a SPA 2, pursuant to which the Company agreed to sell such institutional investors units with each unit consisting of one ordinary share and one warrant to purchase one ordinary share, at a purchase price of $16.00 per unit, for net proceeds of approximately $8.7 million (the “Offering”) before deducting placement agent fees and other estimated offering expenses. An aggregate of 625,000 ordinary shares and warrants to purchase an aggregate of 625,000 ordinary shares (the “Investor Warrants”) were agreed to be issued to the investors under the SPA 2. The Investor Warrants are initially exercisable at $16.00 per Ordinary Share and expire 5.0 years from the date of issuance. Pursuant to a placement agent agreement entered into between the Company and FT Global Capital, Inc. (“FT Global”) dated September 24, 2021 (the “September 2021 PAA”), the Company issued to FT Global warrants (the “Tail Fee Warrants”) to purchase 13,632 Ordinary Shares on substantially the same terms as the Investor Warrants sold in SPA 2, except that the Tail Fee Warrants shall not be exercisable for a period of six months and shall expire 36 months after issuance, and shall have no anti-dilution protection other than adjustments based on stock splits, stock dividends, combinations of shares and similar recapitalization transactions. The fair value of the Investor Warrants were $5,008,524, which was considered a direct cost of the sale of SPA and included in additional paid-in capital. The fair value has been estimated using the Black-Scholes pricing model with the following assumptions: market value of underlying share of $9.20, risk free rate of 1.84%; expected term of 5.0 years; exercise price of the warrants of $16.00, volatility of 146%; and expected future dividends of 0%. The fair value of the Tail Fee Warrants were $92,251, which was considered a direct cost of the sale of SPA and included in additional paid-in capital. The fair value has been estimated using the Black-Scholes pricing model with the following assumptions: market value of underlying share of $9.20, risk free rate of 1.73%; expected term of 3.0 years; exercise price of the warrants of $16.00, volatility of 145%; and expected future dividends of 0%. The summary of warrant activity is as follows: Warrants Weighted Average June 30, 2020 133,182 $ 11.60 5.31 Granted 849,407 $ 42.80 3.48 Forfeited - $ - - Exercised (341,432 ) $ 15.20 - June 30, 2021 641,157 $ 49.60 3.08 Granted 1,215,788 $ 52.00 4.02 Forfeited - $ - - Exercised - $ - - June 30, 2022 1,856,945 $ 35.20 2.99 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Jun. 30, 2022 | |
Commitments and Contingencies [Abstract] | |
Commitments and contingencies | Note 16 – Commitments and contingencies Contingencies From time to time, the Company is a party to various legal actions arising in the ordinary course of business. The Company accrues costs associated with these matters when they become probable and the amount can be reasonably estimated. Legal costs incurred in connection with loss contingencies are expensed as incurred. The Company’s management does not expect any liability from the disposition of such claims and litigation individually or in the aggregate would have a material adverse impact on the Company’s consolidated financial position, results of operations and cash flows. Coronavirus (“COVID-19”) 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 throughout the world. Substantially all of the Company’s new revenue streams are concentrated online. Consequently, the Company’s does not believe the COVID-19 outbreak would materially adversely affect the Company’s business operations, financial condition and operating results for fiscal year ended June 30, 2023. |
Concentrations of Risk
Concentrations of Risk | 12 Months Ended |
Jun. 30, 2022 | |
Risks and Uncertainties [Abstract] | |
Concentrations of risk | Note 17 – Concentrations of risk Credit Risk The Company is exposed to credit risk from its cash in banks and advances on performance obligations. As of June 30, 2022 and 2021, approximately $0.3 million and $0 was deposit with a bank located in the US or Hong Kong subject to credit risk. In the US, the insurance coverage of each bank is USD $250,000. In Hong Kong, the insurance coverage of each bank is HKD 500,000 (approximately $64,000). Prepayments and advances are subject to credit evaluation. An allowance will be made for credit losses on estimated unrecoverable amounts which have been determined by reference to past default experience and the current economic environment. Vendor Concentration Risk As of June 30, 2022, one vendor accounted for 100% of the Company’s accounts payable. For the year ended June 30, 2022, three vendors accounted for 60%, 27% and 13% of the Company’s total purchases. For the year ended June 30, 2021, one vendor accounted for 89% of the Company’s total purchases. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Jun. 30, 2022 | |
Subsequent Events [Abstract] | |
Subsequent events | Note 18 – Subsequent events Sale of Ordinary Shares and Warrants On September 14, 2022, the “Company entered into a securities purchase agreement (the “SPA 3”) with certain institutional investors for a registered direct offering of ordinary shares and warrants. Each unit consists of one ordinary share and one warrant to purchase one ordinary share. The purchase price per unit is $3.20. The gross proceeds from the sale of the securities, before deducting placement agent fees and other estimated offering expenses payable by the Company, was approximately $5.6 million. The Company issued to the investors an aggregate of 1,750,000 ordinary shares and warrants to purchase an aggregate of 1,750,000 ordinary shares. The Investor Warrants are initially exercisable at $3.20 per Ordinary Share and expire 5.0 years from the date of issuance. Pursuant to a placement agent agreement entered into between the Company and FT Global Capital, Inc. (“FT Global”) dated September 24, 2021 (the “September 2021 PAA”), the Company issued to FT Global warrants (the “Tail Fee Warrants”) to purchase 43,125 Ordinary Shares on substantially the same terms as the Investor Warrants sold in SPA 3, except that the Tail Fee Warrants shall not be exercisable for a period of six months and shall expire 36 months after issuance, and shall have no anti-dilution protection other than adjustments based on stock splits, stock dividends, combinations of shares and similar recapitalization transactions. The net proceeds from this offering will be used for general corporate and working capital purposes. The Offering closed on September 19, 2022. Establishment of a Subsidiary On August 11, 2022, Color Star Technology Ohio Inc. (“Color Star Ohio”) was incorporated in the State of Ohio and is 100% owned by the Company. As of the date of this report, Color Star Ohio has not commenced operations. |
Condensed Financial Information
Condensed Financial Information of the Parent Company | 12 Months Ended |
Jun. 30, 2022 | |
Condensed Financial Information Disclosure [Abstract] | |
Condensed financial information of the parent company | Note 19 – Condensed financial information of the parent company The Company performed a test on the restricted net assets of the consolidated subsidiaries in accordance with Securities and Exchange Commission Regulation S-X Rule 4-08 (e) (3), “General Notes to Financial Statements” and concluded that it was applicable for the Company to disclose the financial statements for the parent company. The subsidiaries did not pay any dividend to the Company for the periods presented. For the purpose of presenting parent-only financial information, the Company records its investment in its subsidiary under the equity method of accounting. Such investment is presented on the separate condensed balance sheets of the Company as “Investment in subsidiaries” and the loss of the subsidiaries is presented as “Equity loss of subsidiaries”. Certain information and footnote disclosures generally included in financial statements prepared in accordance with U.S. GAAP have been condensed and omitted. The Company did not have significant capital and other commitments, long-term obligations, or guarantees as of June 30, 2022 and 2021. June 30, June 30, ASSETS CURRENT ASSETS: Cash $ 470,634 $ 26,636 Other receivables - 8,900 Prepayments and advances - 4,300 Total current assets 470,634 39,836 OTHER ASSETS: Intercompany receivable 114,222,952 74,858,613 Investment in subsidiaries - 2,459,560 Total other assets 114,222,952 77,318,173 Total assets $ 114,693,586 $ 77,358,009 LIABILITIES AND SHAREHOLDERS’ EQUITY CURRENT LIABILITIES: Other payables and accrued liabilities $ 327,694 $ 396,797 Other payables - shareholders 10,711 10,711 Total current liabilities 338,405 407,508 OTHER LIABILITIES Deficit of investment in subsidiaries 65,911,417 - Total liabilities 66,249,822 407,508 COMMITMENTS AND CONTINGENCIES SHAREHOLDERS’ EQUITY: Ordinary share, $0.04 par value, 800,000,000 shares authorized, 4,819,700 and 2,758,920 shares issued and outstanding as of June 30, 2022 and 2021, respectively* 192,788 110,357 Additional paid-in-capital 195,654,317 147,684,772 Deferred stock compensation (32,978 ) (682,383 ) Deficit (147,370,363 ) (70,162,245 ) Total shareholders’ equity 48,443,764 76,950,501 Total liabilities and shareholders’ equity $ 114,693,586 $ 77,358,009 * Giving retroactive effect to the 40-for-1 reverse share split on September 26, 2022. For the Years Ended June 30, 2022 2021 2020 GENERAL AND ADMINISTRATIVE EXPENSES $ (4,098,934 ) $ (2,821,121 ) $ (1,402,044 ) STOCK COMPENSATION EXPENSE (4,732,700 ) (5,717,900 ) (3,444,617 ) LOSS FROM OPERATIONS (8,831,634 ) (8,539,021 ) (4,846,661 ) OTHER INCOME (EXPENSE), NET Finance expense (5,507 ) (6,480 ) (5,007 ) Equity loss of subsidiaries (68,370,977 ) (1,118,204 ) (12,562,142 ) Gain on debt settlement - 25,092 - Gain on sale of subsidiaries - 1,400,100 5,787,213 TOTAL OTHER INCOME (EXPENSE), NET (68,376,484 ) 300,508 (6,779,936 ) NET LOSS $ (77,208,118 ) $ (8,238,513 ) $ (11,626,597 ) For the Years Ended June 30, 2022 2021 2020 CASH FLOWS FROM OPERATING ACTIVITIES: Net loss $ (77,208,118 ) $ (8,238,513 ) $ (11,626,597 ) Adjustments to reconcile net loss to cash used in operating activities: Stock compensation expense 4,732,700 5,717,900 3,444,617 Equity loss of subsidiaries 68,370,977 1,118,204 12,562,142 Gain on debt settlement - (25,092 ) - Gain on sale of discontinued operations - (1,400,100 ) (5,787,213 ) Changes in operating assets and liabilities Other receivables 8,900 (6,600 ) - Prepayments and advances 4,300 (4,300 ) (125,000 ) Intercompany receivables (39,364,339 ) (65,500,903 ) (1,231,449 ) Other payables and accrued liabilities (69,103 ) 60,090 93,711 Net cash used in operating activities (43,524,683 ) (68,279,314 ) (2,669,789 ) CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of equipment - - (2,000,000 ) Proceeds from disposal of subsidiaries - 100 600,000 Net cash provided by (used in) investing activities - 100 (1,400,000 ) CASH FLOWS FROM FINANCING ACTIVITIES: Borrowings from shareholders - - 300,000 Borrowings from related parties - - - Proceeds from sale of ordinary shares 43,937,202 62,341,025 4,502,901 Proceeds from exercise of warrants 31,479 5,171,591 - Net cash provided by financing activities 43,968,681 67,512,616 4,802,901 NET CHANGE IN CASH 443,998 (766,598 ) 733,112 CASH, beginning of year 26,636 793,234 60,122 CASH, end of year $ 470,634 $ 26,636 $ 793,234 NON-CASH TRANSACTIONS OF INVESTING AND FINANCING ACTIVITIES: Ordinary shares issued to repay other payables – related parties and service providers $ - $ - $ 1,137,378 Ordinary shares issued to repay debt in subsidiary $ - $ - $ 5,240,679 Ordinary share issued for acquisition of subsidiary $ - $ - $ 1,889,799 Ordinary share issued for acquisition of equipment $ - $ 3,818,000 $ 1,963,607 Ordinary share issued for acquisition of intangible assets held in a subsidiary $ - $ 1,550,000 $ - Other receivables outstanding from disposal of subsidiary $ - $ - $ 1,000,000 Forgiveness of former subsidiary’s receivable upon disposal of subsidiary $ - $ 120,000 $ - Recognition of accrued liabilities from subsidiary $ - $ - $ 214,792 Derecognition of intercompany balance upon disposal of subsidiary $ - $ - $ 23,164,488 Proceeds from disposal of subsidiary received by intercompany $ - $ 1,400,000 $ - |
Accounting Policies, by Policy
Accounting Policies, by Policy (Policies) | 12 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
Going concern uncertainty | Going concern uncertainty The Company had an accumulated deficit of approximately $147.4 million as June 30, 2022 and had a net loss of approximately $77.2 million for the year ended June 30, 2022. In January 2022, the Company’s Color World platform was transformed into the current version, a metaverse with “artificial intelligence + celebrity entertainment” as its core features but it is currently suspending such revenue stream. The Company is expected to resume generating revenue again in January 2023 because the Company is planning to transform its Color World platform into a paid subscripted fee version for our users. If the Company is unable to generate sufficient cash flow within the normal operating cycle of a twelve month period to pay for its future payment obligations, the Company may be required to curtail or cease its operations. Management is trying to alleviate the going concern risk through obtaining additional equity financings to support its working capital, including its recently completed equity financing transaction of approximately $5.6 million on September 14, 2022. However, there is no assurance that management will be successful in their plans. The consolidated financial statements does not include any adjustments that might result from the outcome of this uncertainty |
Basis of presentation | Basis of presentation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). These consolidated financial statements include the accounts of all the directly and indirectly owned subsidiaries listed below. All intercompany transactions and balances have been eliminated in consolidation. |
Principles of consolidation | Principles of consolidation The consolidated financial statements reflect the activities of the following subsidiaries. All material intercompany transactions and balances have been eliminated. Subsidiaries Place incorporated Ownership CACM New York, USA 100 % Color Sky Hong Kong 100 % Modern Pleasure Hong Kong 100 % Color Metaverse Singapore 100 % Color Star Ohio Ohio, USA 100 % |
Use of estimates and assumptions | Use of estimates and assumptions The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting periods. The significant estimates and assumptions made in the preparation of the Company’s consolidated financial statements include the allowance for credit losses of accounts receivable, other receivables, prepayments and advances and deferred income taxes, stock-based compensation, and fair value and useful lives of property, plant and equipment and intangibles assets. Actual results could be materially different from those estimates. |
Revenue recognition | Revenue recognition The Company follows the Financial Accounting Standards Board (“FASB”) Accounting Standards Update (“ASU”) 2014-09 Revenue from Contracts with Customers (ASC 606) to recognize its revenue for all period presented. The core principle underlying this ASU is that the Company recognizes its revenue to represent the transfer of goods and services to customers in an amount that reflects the consideration to which the Company expects to be entitled in such exchange. This 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. The Company’s revenue streams to be recognized at a point in time comprise principally of music performance performed or education services provided. The Company’s revenue streams to be recognized over a period of time comprise of its platform subscribed membership fees which is recognized over the subscription period. The ASU requires the use of a five-step model to recognize revenue from customer contracts. The five-step model requires that the Company (i) identify the contract with the customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, including variable consideration to the extent that it is probable that a significant future reversal will not occur, (iv) allocate the transaction price to the respective performance obligations in the contract, and (v) recognize revenue when (or as) the Company satisfies the performance obligation. The application of the five-step model to the revenue streams compared to the prior guidance did not result in significant changes in the way the Company records its revenue. Upon adoption, the Company evaluated its revenue recognition policy for all revenue streams within the scope of the ASU under previous standards and using the five-step model under the new guidance and confirmed that there were no material differences in the pattern of revenue recognition. 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 offered the following services: (a) Online education academy The Company earns revenues from its customers for subscription for services to be delivered over a period of time, the receipt is initially recorded as “deferred revenue” on the consolidated balance sheets and revenue is recognized ratably over the membership period as services are rendered, usually one year. Membership services revenue also includes fees earned from subscribing members for on-demand content purchases and early access to premium content. The Company is principal in its relationships where its partners, including artist agents, mobile operators, internet service providers and online payment agencies, provide access to the membership services or payment processing services as the Company retains control over its service delivery to its subscribing members. Typically, payments made to its partners, are recorded as cost of revenues and as research and development expenses prior to any revenues being generated in this revenue stream. In July 2021, the Company no longer required its subscribers to pay for the annual subscription fee. Revenues in connection with the on-demand contents are recognized at a point in time when the subscription fee was paid to stream the on-demand contents. (b) Online concert The Company holds online concerts with its star partners. Sale of online concert via subscription fee is accounted for as a single performance obligation which is satisfied at a point in time on the day of the event. Online concert subscription fees are recognized net of App payment collections agent service fee. All ticket sales are final upon payment. As a practical expedient, the Company elects to record the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that the entity otherwise would have recognized is one year or less. Disaggregated information of revenues by services are as follows: For the Years Ended June 30, 2022 2021 2020 Online music education academy subscription $ 16,519,081 $ 4,453,957 $ - Online concert subscription - 2,330,000 - Total revenue $ 16,519,081 $ 6,783,957 $ - |
Financial instruments | Financial instruments US GAAP specifies a hierarchy of valuation techniques for determining the fair value of financial instruments and related fair value measurements based upon whether the inputs to those valuation techniques reflect assumptions other market participants would use based upon market data obtained from independent sources (observable inputs). The valuation hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. In accordance with FASB ASC 820, the following summarizes the fair value hierarchy: The three levels of inputs 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 asset or liability, either directly or indirectly, for substantially the full term of the financial instrument; Level 3 inputs to the valuation methodology are unobservable. Financial instruments included in current assets and current liabilities are reported in the consolidated balance sheets at face value or cost, which approximate fair value because of the short period of time between the origination of such instruments and their expected realization and their current market rates of interest. In June 2016, the Financial Accounting Standards Board (“FASB”) issued ASU 2016-13 (as amended through March 2020), Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 introduced a new forward-looking approach, based on expected losses, to estimate credit losses on certain types of financial instruments, including trade receivables, contract assets and held-to-maturity debt securities, which requires the Company to incorporate considerations of historical information, current information and reasonable and supportable forecasts. ASU 2016-13 also expands disclosure requirements. The Company adopted the standard on July 1, 2020 using the modified retrospective approach. Adoption of ASU 2016-13 resulted in changes to the Company’s accounting policies for trade and other receivables. Upon adoption of ASU 2016-13 the Company evaluates trade receivables and other receivables on a collective (i.e., pool) basis if they share similar risk characteristics. Based on the results of the Company’s evaluation, the adoption of ASU 2016-13 did not have a material impact on the reserve for credit losses as of July 1, 2020. |
Cash and cash equivalents | Cash and cash equivalents The Company considers all highly liquid investments with the original maturity of three months or less at the date of purchase to be cash equivalents. |
Accounts receivable | Accounts receivable Accounts receivable include receivables from , net of an allowance for credit risk. Accounts receivable are recorded at amount received from the Company’s customers and do not bear interest. Allowance for credit losses for accounts receivables is established based on various factors including historical payments and current economic trends. The Company reviews its allowance for accounts receivable by assessing individual accounts receivable over a specific aging and amount. All other balances are pooled based on historical collection experience. The estimate of expected credit losses is based on information about past events, current economic conditions, and forecasts of future economic conditions that affect collectability. Accounts receivable are written-off on a case by case basis , net of any amounts that may be collected. |
Other receivables | Other receivables Other receivables primarily include security deposit and receivables resulted from sale of equipment, net of an allowance for credit losses Allowance for credit losses for other receivables is established based on various factors including historical payments and current economic trends. The Company reviews its allowance for other receivables by assessing individual other receivables over a specific aging and amount. All other balances are pooled based on historical collection experience. The estimate of expected credit losses is based on information about past events, current economic conditions, and forecasts of future economic conditions that affect collectability. Other receivables are written-off on a case by case basis , net of any amounts that may be collected. |
Prepayments, current | Prepayments, current Prepayments, current include funds deposited or advanced to outside vendors for future performance obligations, program license fees and service fees. As a standard practice in the music performance industry, many of the Company’s vendors require a certain amount to be deposited with them as a guarantee that the Company will complete its purchases on a timely basis. The Company has legally binding contracts with its vendors, the prepayments will be used to offset performance fees, program license fees, purchase price or service fees, and the amounts are refundable and bear no interest if outside vendors breach the contracts. |
Prepayments, non-current | Prepayments, non-current Prepayments, non-current represent cash deposited or advanced for software development expenditure. |
Property, plant and equipment | Property, plant and equipment Property, plant and equipment are stated at cost or at fair value of the identifiable assets acquired on the acquisition date less accumulated depreciation and impairment loss. Expenditures for maintenance and repairs are charged to operations as incurred while additions, renewals and improvements are capitalized. Depreciation is provided over the estimated useful life of each class of depreciable assets and is computed using the straight-line method with 0%-5% residual value. The estimated useful lives of assets are as follows: Useful life Performance equipment 10 years Office equipment 5 years |
Intangible assets, net | Intangible assets, net Intangible assets are stated at cost, less accumulated amortization. Amortization expense is recognized on the straight-line basis over the estimated useful lives of the assets. The Company has obtained copyrights to use the online education academy courses for 3 years to unlimited years. The Company amortizes the copyrights with limited useful life over their useful life using the straight-line method and amortizes the copyrights with unlimited useful life over 5 years, which the copyrights are expected to contribute to the revenue of the Company’s online education academy App. |
Accounting for long-lived assets | Accounting for long-lived assets The Company classifies its long-lived assets into: (i) performance equipment, (ii) office equipment and (iii) intangible assets. Long-lived assets held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of such assets may not be fully recoverable. It is possible that these assets could become impaired as a result of technological or other industry changes. If circumstances require a long-lived asset or asset group to be tested for possible impairment, the Company first compares undiscounted cash flows expected to be generated by that asset or asset group to its carrying value. If the carrying value of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent that the carrying value exceeds its fair value. Fair value is determined through various valuation techniques, including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. If the value of an asset is determined to be impaired, the impairment to be recognized is measured in the amount by which the carrying amount of the asset exceeds the fair value of the asset. Assets to be disposed of are reported at the lower of the carrying amount or the fair value, less disposition costs. There were no impairment charges for the years ended June 30, 2022 and 2020. Impairment charges amounted to $99,943 for the year ended June 30, 2021. Competitive pricing pressures and changes in interest rates could materially and adversely affect the Company’s estimates of future net cash flows to be generated by the long-lived assets, and thus could result in future impairment losses. |
Accounts payable | Accounts payable Accounts payable represents royal fees payable to the Company’s vendor which was incurred from the revenues generated of its on-demand contents in the Color World Platform. |
Deferred revenue | Deferred revenue Deferred revenue represents the Color World Platform subscription fees collected from its members in advance of the revenue being recognized in accordance with the Company’s revenue recognition policy as discussed above. |
Leases | Leases The Company accounts for leases in accordance with ASC 842 “Leases”. Operating lease right-of-use (“ROU”) assets and lease liabilities are recognized at the commencement date 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 uses 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 considers 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 operating lease ROU asset also excludes lease incentives. Lease expense is recognized on a straight-line basis over the lease term. Leases with an initial term of 12 months or less are not recorded on the balance sheet as operating lease ROU assets and lease liabilities. 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 operating lease liabilities in any tested asset group and include the associated operating lease payments in the undiscounted future pre-tax cash flows. As of June 30, 2022 and 2021, the Company does not have any lease with an initial term of more than 12 months. |
Research and development | Research and development Research and development expenses include website or app development expenditure costs, salaries and other compensation-related expenses to the Company’s research and product development personnel and related expenses for the Company’s research and product development team. The Company expenses all costs that are incurred in connection with the planning and implementation phases of development, and costs that are associated with maintenance of the existing website or app for internal use. |
Stock-based compensation | Stock-based compensation The Company records stock-based compensation expense for employees at fair value on the grant date and recognizes the expense over the employee’s requisite service period. The Company’s expected volatility assumption is based on the historical volatility of the Company’s stock. The expected life assumption is primarily based on historical exercise patterns and employee post-vesting termination rate. The risk-free interest rate for the expected term of an option is based on the U.S. Treasury yield curve in effect at the time of grant. The expected dividend yield is based on the Company’s current and expected dividend policy. The Company records stock-based compensation expense for non-employees at fair value on the grant date and recognizes the expense over the service provider’s requisite service period. |
Income taxes | Income taxes The Company accounts for income taxes in accordance with FASB ASC 740, “Income Taxes,” which requires the Company to use the asset and liability method of accounting for income taxes. Under the asset and liability method, deferred income taxes are recognized for the tax consequences of temporary differences by applying enacted statutory tax rates applicable to future years to differences between financial statement carrying amounts and the tax bases of existing assets and liabilities and operating loss and tax credit carry forwards. Under this accounting standard, the effect on deferred income taxes of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is recognized if it is more likely than not that some portion, or all of, a deferred tax asset will not be realized. ASC 740-10, “Accounting for Uncertainty in Income Taxes,” defines uncertainty in income taxes and the evaluation of a tax position as a two-step process. The first step is to determine whether it is more likely than not that a tax position will be sustained upon examination, including the resolution of any related appeals or litigation based on the technical merits of that position. The second step is to measure a tax position that meets the more-likely-than-not threshold to determine the amount of benefit to be recognized in the financial statements. A tax position is measured at the largest amount of benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. Tax positions that previously failed to meet the more-likely-than-not recognition threshold should be recognized in the first subsequent period in which the threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not criteria should be de-recognized in the first subsequent financial reporting period in which the threshold is no longer met. Penalties and interest incurred related to underpayment of income tax are classified as income tax expense in the period incurred. United States federal, state and local income tax returns for the years of 2019 to 2021 are subject to examination by any applicable tax authorities. |
Earnings (loss) per share | Earnings (loss) per share The Company reports earnings (loss) per share in accordance with U.S. GAAP, which requires presentation of basic and diluted earnings (loss) per share in conjunction with the disclosure of the methodology used in computing such earnings per share. Basic earnings (loss) per share is computed by dividing income (loss) available to common shareholders by the weighted average common shares outstanding during the period. Diluted earnings per share takes into account the potential dilution that could occur if securities or other contracts, such as warrants, options, restricted stock-based grants and convertible preferred stock, to issue ordinary shares were exercised and converted into ordinary shares. Ordinary share equivalents having an anti-dilutive effect on earnings per share are excluded from the calculation of diluted earnings per share. Dilution is computed by applying the treasury stock method. Under this method, options and warrants are assumed to be exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby were used to purchase ordinary shares at the average market price during the period. When the Company has a loss, no potential dilutive items are included since they would be antidilutive. Stock dividends or stock splits are accounted for retroactively if the stock dividends or stock splits occur during the period, or retroactively if the stock dividends or stock splits occur after the end of the period but before the release of the financial statements, by considering it effective as of the beginning of the earliest period presented. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In January 2020, the FASB issued ASU 2020-01 to clarify the interaction of the accounting for equity securities under ASC 321 and investments accounted for under the equity method of accounting in ASC 323 and the accounting for certain forward contracts and purchased options accounted for under ASC 815. With respect to the interactions between ASC 321 and ASC 323, the amendments clarify that an entity should consider observable transactions that require it to either apply or discontinue the equity method of accounting when applying the measurement alternative in ASC 321, immediately before applying or upon discontinuing the equity method of accounting. With respect to forward contracts or purchased options to purchase securities, the amendments clarify that when applying the guidance in ASC 815-10-15-141(a), an entity should not consider whether upon the settlement of the forward contract or exercise of the purchased option, individually or with existing investments, the underlying securities would be accounted for under the equity method in ASC 323 or the fair value option in accordance with ASC 825. The ASU is effective for interim and annual reporting periods beginning after December 15, 2020. Early adoption is permitted, including adoption in any interim period. The adoption of this ASU did not have a material effect on the Company’s consolidated financial statements. The Company does not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on the Company’s consolidated financial statements. |
Summary of significant accoun_2
Summary of significant accounting policies (Tables) | 12 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
Schedule of consolidated financial statements | Subsidiaries Place incorporated Ownership CACM New York, USA 100 % Color Sky Hong Kong 100 % Modern Pleasure Hong Kong 100 % Color Metaverse Singapore 100 % Color Star Ohio Ohio, USA 100 % |
Schedule of disaggregated information of revenues | For the Years Ended June 30, 2022 2021 2020 Online music education academy subscription $ 16,519,081 $ 4,453,957 $ - Online concert subscription - 2,330,000 - Total revenue $ 16,519,081 $ 6,783,957 $ - |
Schedule of estimated useful lives of assets | Useful life Performance equipment 10 years Office equipment 5 years |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 12 Months Ended |
Jun. 30, 2022 | |
Discontinued Operations [Abstract] | |
Schedule of consolidated statements of operations and comprehensive loss | For the 2020 Revenue $ 28,747,362 Cost of revenue 26,553,802 Gross profit 2,193,560 OPERATING EXPENSES: Provision for doubtful accounts (8,385,084 ) Selling, general and administrative expenses (3,484,700 ) Research and development expenses (139,780 ) Total operating expenses (12,009,564 ) Loss from operations (9,816,004 ) OTHER INCOME (EXPENSES) Other expenses, net 1,872 Interest income 235 Interest expense (1,783,833 ) Finance expense (825 ) Estimated claims charges (591,884 ) Total other expense, net (2,374,435 ) Loss before income taxes (12,190,439 ) Income tax expense - Net loss from discontinued operations $ (12,190,439 ) |
Schedule of discontinued operations and reconciliation of gain on sale of discontinued operations | May 6, CURRENT ASSETS: Cash and cash equivalents $ 222,591 Accounts and notes receivable, net 28,598,318 Inventories 77,049 Other receivables, net 1,815,307 Other receivables – related party 160,505 Prepayments and advances, net 15,077,736 Prepayment – related party 247,598 Total current assets 46,199,104 OTHER ASSETS: Property, plant and equipment, net 795,974 Operating lease right-of-use assets 1,031,940 Total other assets 1,827,914 Total assets $ 48,027,018 CURRENT LIABILITIES: Short-term loan - bank $ 23,996,261 Accounts payable 16,158,660 Customer deposits 888,592 Other payables 23,197,053 Other payables – related parties 6,541 Accrued liabilities 5,143,410 Operating lease liabilities- current 291,228 Taxes payable 154,680 Accrued contingent liabilities 6,997,071 Total current liabilities 76,833,496 OTHER LIABILITIES: Operating lease liabilities - noncurrent 595,086 Total other liabilities 595,086 Total liabilities $ 77,428,582 Total net deficit $ 29,401,564 Additional paid-in-capital carryover (13,128,249 ) Retained earnings carryover (7,486,219 ) Total consideration received 600,000 Exchange rate effect (2,764,813 ) Total gain on sale of discontinued operations $ 6,622,283 |
Schedule of reconciliation of loss on sale of discontinued operations | June 25, Total consideration paid $ 3,583,952 Forgiven of fair value of earn out payment (1,694,153 ) Expenses incurred from February 14 to June 25, 2020 (54,729 ) Total consideration received (1,000,000 ) Total loss on sale of discontinued operations $ 835,070 |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 12 Months Ended |
Jun. 30, 2022 | |
Accounts receivable [Abstract] | |
Schedule of accounts receivable | June 30, June 30, Color World platform subscription fees due from App payment collections agent $ 2,507,981 $ 3,191,711 |
Other Receivables (Tables)
Other Receivables (Tables) | 12 Months Ended |
Jun. 30, 2022 | |
Other Receivables Net [Abstract] | |
Schedule of other receivables | June 30, June 30, Rent deposit $ - $ 8,900 Receivable from sale of equipment 6,819,050 - Other receivables $ 6,819,050 $ 8,900 |
Prepayments (Tables)
Prepayments (Tables) | 12 Months Ended |
Jun. 30, 2022 | |
Prepayments [Abstract] | |
Schedule of prepayments, current | June 30, June 30, Prepayment for online concert productions $ 8,000,000 $ 1,648,000 Prepayment for live concert productions 5,000,000 - Prepayment for advertisement 4,666,664 - Prepayment for program license fees - 2,615,527 Prepayment for rent - 4,300 Prepayments and advances $ 17,666,664 $ 4,267,827 |
Schedule of prepayments, non-current | June 30, June 30, Prepayment for software development expenditure $ - $ 52,000,000 |
Property, Plant and Equipment_2
Property, Plant and Equipment, Net (Tables) | 12 Months Ended |
Jun. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property, plant and equipment | June 30, June 30, Performance equipment $ - $ 10,637,926 Office equipment 39,602 38,477 Total 39,602 10,676,403 Less: Accumulated depreciation (9,374 ) (1,516,189 ) Property, plant and equipment, net $ 30,228 $ 9,160,214 |
Intangible Assets, Net (Tables)
Intangible Assets, Net (Tables) | 12 Months Ended |
Jun. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of intangible assets | June 30, June 30, Copyrights of online education academy courses $ 32,198,770 $ 14,453,243 Less: Accumulated amortization (6,631,812 ) (2,180,917 ) Carrying amount $ 25,566,958 $ 12,272,326 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 12 Months Ended |
Jun. 30, 2022 | |
Related Party Transactions [Abstract] | |
Schedule of other payables - related party | Name of Relationship Nature June 30, June 30, Weili He Former Chief Financial Officer (“CFO”) of the Company who held less than 5% of the Company ordinary shares currently Salary Payable $ 10,711 $ 10,711 Hui Xu General Manager of CACM Interest-free loan, due on demand 350,000 - Jehan Zeb Khan Director and Former Co-Acting CEO of the Company Interest-free loan, due on demand 2,173 - Total $ 362,884 $ 10,711 |
Accounts payable (Tables)
Accounts payable (Tables) | 12 Months Ended |
Jun. 30, 2022 | |
Payables and Accruals [Abstract] | |
Schedule of accounts payable | June 30, June 30, Royal fees payable $ 3,770,945 $ - |
Deferred Revenue (Tables)
Deferred Revenue (Tables) | 12 Months Ended |
Jun. 30, 2022 | |
Deferred Revenue [Abstract] | |
Schedule of deferred revenue | June 30, June 30, Color World platform subscription fees collected in advance of revenue recognition $ - $ 3,596,821 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Jun. 30, 2022 | |
Leases [Abstract] | |
Schedule of lease obligations | Year Ending June 30, Operating Lease Amount 2023 $ 34,626 Total lease payments $ 34,626 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Jun. 30, 2022 | |
Income Taxes [Abstract] | |
Schedule of Income (loss) before provision for income taxes | For the For the For the Cayman $ (8,837,141 ) $ (7,120,310 ) $ (4,851,668 ) United States (617,057 ) (541,744 ) (316,142 ) Hong Kong (67,753,920 ) (576,459 ) (832 ) $ (77,208,118 ) $ (8,238,513 ) $ (5,168,642 ) |
Schedule of effective income tax rate | For the For the For the Federal statutory rate 21.0 % 21.0 % 21.0 % State statutory rate 5.6 % 5.6 % 5.6 % Valuation allowance (26.6 )% (26.6 )% (26.6 )% Effective tax rate 0.0 % 0.0 % 0.0 % |
Schedule of components of deferred tax assets | June 30, June 30, Deferred tax assets Net operating loss carryforward in the U.S. 442,051 278,531 Net operating loss carryforward in Hong Kong 11,274,650 95,253 Valuation allowance (11,716,701 ) (373,784 ) Total net deferred tax assets $ - $ - |
Shareholders_ Equity (Tables)
Shareholders’ Equity (Tables) | 12 Months Ended |
Jun. 30, 2022 | |
Stockholders' Equity Note [Abstract] | |
Schedule of restricted stock grants | Restricted stock grants Shares Weighted Aggregate Unvested as of June 30, 2019 16,500 $ 102.80 $ - Granted 4,500 $ 102.80 - Granted - $ 18.80 - Vested (7,125 ) $ 211.20 - Unvested as of June 30, 2020 13,875 $ 82.40 $ - Forfeited (3,000 ) $ 2.57 - Granted 17,500 $ 55.60 - Vested (16,229 ) $ 74.80 - Unvested as of June 30, 2021 12,146 $ 56.00 - Forfeited (3,750 ) $ 44.80 - Granted 8,000 $ 10.80 - Vested (11,750 ) $ 48.40 - Unvested as of June 30, 2022 4,646 $ 7.20 - |
Schedule of warrant activity | Warrants Weighted Average June 30, 2020 133,182 $ 11.60 5.31 Granted 849,407 $ 42.80 3.48 Forfeited - $ - - Exercised (341,432 ) $ 15.20 - June 30, 2021 641,157 $ 49.60 3.08 Granted 1,215,788 $ 52.00 4.02 Forfeited - $ - - Exercised - $ - - June 30, 2022 1,856,945 $ 35.20 2.99 |
Condensed Financial Informati_2
Condensed Financial Information of the Parent Company (Tables) | 12 Months Ended |
Jun. 30, 2022 | |
Condensed Financial Information Disclosure [Abstract] | |
Schedule of parent company balance sheets | June 30, June 30, ASSETS CURRENT ASSETS: Cash $ 470,634 $ 26,636 Other receivables - 8,900 Prepayments and advances - 4,300 Total current assets 470,634 39,836 OTHER ASSETS: Intercompany receivable 114,222,952 74,858,613 Investment in subsidiaries - 2,459,560 Total other assets 114,222,952 77,318,173 Total assets $ 114,693,586 $ 77,358,009 LIABILITIES AND SHAREHOLDERS’ EQUITY CURRENT LIABILITIES: Other payables and accrued liabilities $ 327,694 $ 396,797 Other payables - shareholders 10,711 10,711 Total current liabilities 338,405 407,508 OTHER LIABILITIES Deficit of investment in subsidiaries 65,911,417 - Total liabilities 66,249,822 407,508 COMMITMENTS AND CONTINGENCIES SHAREHOLDERS’ EQUITY: Ordinary share, $0.04 par value, 800,000,000 shares authorized, 4,819,700 and 2,758,920 shares issued and outstanding as of June 30, 2022 and 2021, respectively* 192,788 110,357 Additional paid-in-capital 195,654,317 147,684,772 Deferred stock compensation (32,978 ) (682,383 ) Deficit (147,370,363 ) (70,162,245 ) Total shareholders’ equity 48,443,764 76,950,501 Total liabilities and shareholders’ equity $ 114,693,586 $ 77,358,009 |
Schedule of parent company statements of operations and comprehensive loss | For the Years Ended June 30, 2022 2021 2020 GENERAL AND ADMINISTRATIVE EXPENSES $ (4,098,934 ) $ (2,821,121 ) $ (1,402,044 ) STOCK COMPENSATION EXPENSE (4,732,700 ) (5,717,900 ) (3,444,617 ) LOSS FROM OPERATIONS (8,831,634 ) (8,539,021 ) (4,846,661 ) OTHER INCOME (EXPENSE), NET Finance expense (5,507 ) (6,480 ) (5,007 ) Equity loss of subsidiaries (68,370,977 ) (1,118,204 ) (12,562,142 ) Gain on debt settlement - 25,092 - Gain on sale of subsidiaries - 1,400,100 5,787,213 TOTAL OTHER INCOME (EXPENSE), NET (68,376,484 ) 300,508 (6,779,936 ) NET LOSS $ (77,208,118 ) $ (8,238,513 ) $ (11,626,597 ) |
Schedule of parent company statements of cash flows | For the Years Ended June 30, 2022 2021 2020 CASH FLOWS FROM OPERATING ACTIVITIES: Net loss $ (77,208,118 ) $ (8,238,513 ) $ (11,626,597 ) Adjustments to reconcile net loss to cash used in operating activities: Stock compensation expense 4,732,700 5,717,900 3,444,617 Equity loss of subsidiaries 68,370,977 1,118,204 12,562,142 Gain on debt settlement - (25,092 ) - Gain on sale of discontinued operations - (1,400,100 ) (5,787,213 ) Changes in operating assets and liabilities Other receivables 8,900 (6,600 ) - Prepayments and advances 4,300 (4,300 ) (125,000 ) Intercompany receivables (39,364,339 ) (65,500,903 ) (1,231,449 ) Other payables and accrued liabilities (69,103 ) 60,090 93,711 Net cash used in operating activities (43,524,683 ) (68,279,314 ) (2,669,789 ) CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of equipment - - (2,000,000 ) Proceeds from disposal of subsidiaries - 100 600,000 Net cash provided by (used in) investing activities - 100 (1,400,000 ) CASH FLOWS FROM FINANCING ACTIVITIES: Borrowings from shareholders - - 300,000 Borrowings from related parties - - - Proceeds from sale of ordinary shares 43,937,202 62,341,025 4,502,901 Proceeds from exercise of warrants 31,479 5,171,591 - Net cash provided by financing activities 43,968,681 67,512,616 4,802,901 NET CHANGE IN CASH 443,998 (766,598 ) 733,112 CASH, beginning of year 26,636 793,234 60,122 CASH, end of year $ 470,634 $ 26,636 $ 793,234 NON-CASH TRANSACTIONS OF INVESTING AND FINANCING ACTIVITIES: Ordinary shares issued to repay other payables – related parties and service providers $ - $ - $ 1,137,378 Ordinary shares issued to repay debt in subsidiary $ - $ - $ 5,240,679 Ordinary share issued for acquisition of subsidiary $ - $ - $ 1,889,799 Ordinary share issued for acquisition of equipment $ - $ 3,818,000 $ 1,963,607 Ordinary share issued for acquisition of intangible assets held in a subsidiary $ - $ 1,550,000 $ - Other receivables outstanding from disposal of subsidiary $ - $ - $ 1,000,000 Forgiveness of former subsidiary’s receivable upon disposal of subsidiary $ - $ 120,000 $ - Recognition of accrued liabilities from subsidiary $ - $ - $ 214,792 Derecognition of intercompany balance upon disposal of subsidiary $ - $ - $ 23,164,488 Proceeds from disposal of subsidiary received by intercompany $ - $ 1,400,000 $ - |
Organization and Description _2
Organization and Description of Business (Details) - USD ($) | Jun. 29, 2021 | Mar. 10, 2020 | Aug. 20, 2018 | Aug. 11, 2022 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 03, 2020 | May 07, 2020 |
Organization and Description of Business (Details) [Line Items] | ||||||||
Outstanding equity interest percentage | 80% | |||||||
Outstanding equity consideration (in Dollars) | $ 100 | |||||||
Ordinary shares issued (in Shares) | 4,819,700 | 2,758,920 | ||||||
Subsequent Event [Member] | ||||||||
Organization and Description of Business (Details) [Line Items] | ||||||||
Ownership percentage | 100% | |||||||
CACM Group [Member] | ||||||||
Organization and Description of Business (Details) [Line Items] | ||||||||
Incorporate of percentage | 100% | |||||||
Net profits or loss percentage | 80% | |||||||
Baydolphin [Member] | ||||||||
Organization and Description of Business (Details) [Line Items] | ||||||||
Incorporate of percentage | 100% | |||||||
Net profits or loss percentage | 20% | |||||||
Color China [Member] | ||||||||
Organization and Description of Business (Details) [Line Items] | ||||||||
Ordinary shares issued (in Shares) | 115,834 | 115 | ||||||
Aggregate payment to sellers (in Dollars) | $ 2,000,000 |
Summary of significant accoun_3
Summary of significant accounting policies (Details) - USD ($) | 12 Months Ended | ||
Sep. 14, 2022 | Jun. 30, 2022 | Jun. 30, 2021 | |
Summary of significant accounting policies (Details) [Line Items] | |||
Accumulated deficit | $ 147,400,000 | ||
Net loss | $ 77,200,000 | ||
Working capital | $ 5,600,000 | ||
Unlimited useful life | 5 years | ||
Impairment charges amount | $ 99,943 | ||
Percentage of tax realized upon ultimate settlement | 50% | ||
Minimum [Member] | |||
Summary of significant accounting policies (Details) [Line Items] | |||
Residual value, percentage | 0% | ||
Maximum [Member] | |||
Summary of significant accounting policies (Details) [Line Items] | |||
Residual value, percentage | 5% |
Summary of significant accoun_4
Summary of significant accounting policies (Details) - Schedule of consolidated financial statements | 12 Months Ended |
Jun. 30, 2022 | |
CACM [Member] | |
Summary of significant accounting policies (Details) - Schedule of consolidated financial statements [Line Items] | |
Place incorporated | New York, USA |
Ownership percentage | 100% |
Color Sky [Member] | |
Summary of significant accounting policies (Details) - Schedule of consolidated financial statements [Line Items] | |
Place incorporated | Hong Kong |
Ownership percentage | 100% |
Modern Pleasure[Member] | |
Summary of significant accounting policies (Details) - Schedule of consolidated financial statements [Line Items] | |
Place incorporated | Hong Kong |
Ownership percentage | 100% |
Color Metaverse [Member] | |
Summary of significant accounting policies (Details) - Schedule of consolidated financial statements [Line Items] | |
Place incorporated | Singapore |
Ownership percentage | 100% |
Color Star Ohio [Member] | |
Summary of significant accounting policies (Details) - Schedule of consolidated financial statements [Line Items] | |
Place incorporated | Ohio, USA |
Ownership percentage | 100% |
Summary of significant accoun_5
Summary of significant accounting policies (Details) - Schedule of disaggregated information of revenues - USD ($) | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | |
Schedule of disaggregated information of revenues [Abstract] | |||
Online music education academy subscription | $ 16,519,081 | $ 4,453,957 | |
Online concert subscription | 2,330,000 | ||
Total revenue | $ 16,519,081 | $ 6,783,957 |
Summary of significant accoun_6
Summary of significant accounting policies (Details) - Schedule of estimated useful lives of assets | 12 Months Ended |
Jun. 30, 2022 | |
Performance equipment [Member] | |
Public Utility, Property, Plant and Equipment [Line Items] | |
Useful life | 10 years |
Office equipment [Member] | |
Public Utility, Property, Plant and Equipment [Line Items] | |
Useful life | 5 years |
Business Combinations (Details)
Business Combinations (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | |||
Feb. 14, 2020 | Jun. 30, 2022 | Jun. 03, 2020 | May 07, 2020 | Dec. 31, 2019 | |
Sunway Kids [Member] | |||||
Business Combinations (Details) [Line Items] | |||||
Business combinations, description | The shares had a fair value of approximately $1.9 million based on the closing market price of $0.95 per share on February, 14, 2020, the acquisition date. The total consideration was valued at approximately $3.6 million, which include approximately $1.7 million based upon a 5.8% discount rate of the $2.0 million earn-out payment schedule, and approximately $1.9 million for the shares issued. | ||||
Color China [Member] | |||||
Business Combinations (Details) [Line Items] | |||||
Business combinations, description | on June 3, 2020 were valued at approximately $4.0 million, consisted of 4,633,333 ordinary shares issued at a fair value of $1,963,607 based on the closing market price of $0.4238 per share on June 3, 2020, and cash payment of $2.0 million. | ||||
Business combinations ownership, percentage | 100% | ||||
Share Exchange Agreement [Member] | |||||
Business Combinations (Details) [Line Items] | |||||
Business combinations ordinary shares issued | 1,989,262 | 4,633,333 | 4,633,333 | 1,989,262 | |
Ordinary shares amount (in Dollars) | $ 2 | ||||
Business combinations aggregate amount paid to sellers (in Dollars) | $ 2 |
Discontinued Operations (Detail
Discontinued Operations (Details) - USD ($) | 1 Months Ended | |
Jun. 25, 2020 | Mar. 31, 2020 | |
Discontinued Operations (Details) [Line Items] | ||
Percentage of ordinary shares | 5% | |
Exchange for cash consideration | $ 600,000 | |
Sunway Kids [Member] | ||
Discontinued Operations (Details) [Line Items] | ||
Disposition of purchase agreement, description | the Company, Sunway Kids and Mr. Yanliang Han (the “SK Purchaser”), an unrelated third party, entered into a share purchase agreement (the “Disposition SPA”). Pursuant to the Disposition SPA, the SK Purchaser agreed to purchase Sunway Kids in exchange for cash consideration of $2.4 million. Upon closing of the transaction, the SK Purchaser became the sole shareholder of Sunway Kids and as a result, assumed all assets and liabilities of all the subsidiaries and variable interest entities (the “VIE”) owned or controlled by Sunway Kids. The SK Purchaser settled $1.0 million of its payment obligation in November 2020 through a tri-party settlement agreement executed on September 29, 2020 among the Company, SK Purchaser and the Asset Seller. Although the SK Purchaser is current with its installment payment, the Company will recognize the remaining installment payment on a cash basis as collectability of the remaining $1.4 million cannot be reasonably assured. During the year ended June 30, 2021, the Company received the remaining $1.4 million. The disposition of Sunway Kids resulted in the recognition of a gain (loss) of approximately $1.4 million and $(0.8) million that is recorded in the accompanying consolidated statements of operations and comprehensive income (loss) in the caption of “gain (loss) from discontinued operations” during the years ended June 30, 2021 and 2020, respectively. |
Discontinued Operations (Deta_2
Discontinued Operations (Details) - Schedule of consolidated statements of operations and comprehensive loss - Discontinued Operations [Member] | 12 Months Ended |
Jun. 30, 2022 USD ($) | |
Discontinued Operations (Details) - Schedule of consolidated statements of operations and comprehensive loss [Line Items] | |
Revenue | $ 28,747,362 |
Cost of revenue | 26,553,802 |
Gross profit | 2,193,560 |
Provision for doubtful accounts | (8,385,084) |
Selling, general and administrative expenses | (3,484,700) |
Research and development expenses | (139,780) |
Total operating expenses | (12,009,564) |
Loss from operations | (9,816,004) |
Other expenses, net | 1,872 |
Interest income | 235 |
Interest expense | (1,783,833) |
Finance expense | (825) |
Estimated claims charges | (591,884) |
Total other expense, net | (2,374,435) |
Loss before income taxes | (12,190,439) |
Income tax expense | |
Net loss from discontinued operations | $ (12,190,439) |
Discontinued Operations (Deta_3
Discontinued Operations (Details) - Schedule of discontinued operations and reconciliation of gain on sale of discontinued operations - Continuing Operations [Member] | May 06, 2020 USD ($) |
Discontinued Operations (Details) - Schedule of discontinued operations and reconciliation of gain on sale of discontinued operations [Line Items] | |
Cash and cash equivalents | $ 222,591 |
Accounts and notes receivable, net | 28,598,318 |
Inventories | 77,049 |
Other receivables, net | 1,815,307 |
Other receivables – related party | 160,505 |
Prepayments and advances, net | 15,077,736 |
Prepayment – related party | 247,598 |
Total current assets | 46,199,104 |
Property, plant and equipment, net | 795,974 |
Operating lease right-of-use assets | 1,031,940 |
Total other assets | 1,827,914 |
Total assets | 48,027,018 |
Short-term loan - bank | 23,996,261 |
Accounts payable | 16,158,660 |
Customer deposits | 888,592 |
Other payables | 23,197,053 |
Other payables – related parties | 6,541 |
Accrued liabilities | 5,143,410 |
Operating lease liabilities- current | 291,228 |
Taxes payable | 154,680 |
Accrued contingent liabilities | 6,997,071 |
Total current liabilities | 76,833,496 |
Operating lease liabilities - noncurrent | 595,086 |
Total other liabilities | 595,086 |
Total liabilities | 77,428,582 |
Total net deficit | 29,401,564 |
Additional paid-in-capital carryover | (13,128,249) |
Retained earnings carryover | (7,486,219) |
Total consideration received | 600,000 |
Exchange rate effect | (2,764,813) |
Total gain on sale of discontinued operations | $ 6,622,283 |
Discontinued Operations (Deta_4
Discontinued Operations (Details) - Schedule of reconciliation of loss on sale of discontinued operations - Discontinued Operations [Member] | Jun. 25, 2020 USD ($) |
Discontinued Operations (Details) - Schedule of reconciliation of loss on sale of discontinued operations [Line Items] | |
Total consideration paid | $ 3,583,952 |
Forgiven of fair value of earn out payment | (1,694,153) |
Expenses incurred from February 14 to June 25, 2020 | (54,729) |
Total consideration received | (1,000,000) |
Total loss on sale of discontinued operations | $ 835,070 |
Accounts Receivable (Details)
Accounts Receivable (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Accounts receivable [Abstract] | ||
Provision for allowance on credit losses |
Accounts Receivable (Details) -
Accounts Receivable (Details) - Schedule of accounts receivable - USD ($) | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Schedule of Accounts Receivable [Abstract] | ||
Color World platform subscription fees due from App payment collections agent | $ 2,507,981 | $ 3,191,711 |
Other Receivables (Details) - S
Other Receivables (Details) - Schedule of other receivables - USD ($) | Jun. 30, 2022 | Jun. 30, 2021 |
Schedule of other receivables [Abstract] | ||
Rent deposit | $ 8,900 | |
Receivable from sale of equipment | 6,819,050 | |
Other receivables | $ 6,819,050 | $ 8,900 |
Prepayments (Details) - Schedul
Prepayments (Details) - Schedule of prepayments, current - USD ($) | Jun. 30, 2022 | Jun. 30, 2021 |
Schedule of prepayments, current [Abstract] | ||
Prepayment for online concert productions | $ 8,000,000 | $ 1,648,000 |
Prepayment for live concert productions | 5,000,000 | |
Prepayment for advertisement | 4,666,664 | |
Prepayment for program license fees | 2,615,527 | |
Prepayment for rent | 4,300 | |
Prepayments and advances | $ 17,666,664 | $ 4,267,827 |
Prepayments (Details) - Sched_2
Prepayments (Details) - Schedule of prepayments, non-current - USD ($) | Jun. 30, 2022 | Jun. 30, 2021 |
Schedule of prepayments, non-current [Abstract] | ||
Prepayment for software development expenditure | $ 52,000,000 |
Property, Plant and Equipment_3
Property, Plant and Equipment, Net (Details) - USD ($) | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation expense | $ 1,445,573 | $ 1,536,178 | $ 0 |
Gain on disposal of equipment | $ 94,984 |
Property, Plant and Equipment_4
Property, Plant and Equipment, Net (Details) - Schedule of property, plant and equipment - USD ($) | Jun. 30, 2022 | Jun. 30, 2021 |
Property, Plant and Equipment [Line Items] | ||
Total | $ 39,602 | $ 10,676,403 |
Less: Accumulated depreciation | (9,374) | (1,516,189) |
Property, plant and equipment, net | 30,228 | 9,160,214 |
Performance equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total | 10,637,926 | |
Office equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total | $ 39,602 | $ 38,477 |
Intangible Assets, Net (Details
Intangible Assets, Net (Details) - USD ($) | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Amortization expense | $ 4,450,895 | $ 2,180,917 | $ 0 |
Intangible Assets, Net (Detai_2
Intangible Assets, Net (Details) - Schedule of intangible assets - USD ($) | Jun. 30, 2022 | Jun. 30, 2021 |
Schedule of intangible assets [Abstract] | ||
Copyrights of online education academy courses | $ 32,198,770 | $ 14,453,243 |
Less: Accumulated amortization | (6,631,812) | (2,180,917) |
Carrying amount | $ 25,566,958 | $ 12,272,326 |
Related Party Transactions (Det
Related Party Transactions (Details) - Schedule of other payables - related party - USD ($) | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Related Party Transaction [Line Items] | ||
Other payables & related party | $ 362,884 | $ 10,711 |
Weili He [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship | Former Chief Financial Officer (“CFO”) of the Company who held less than 5% of the Company ordinary shares currently | |
Nature | Salary Payable | |
Other payables & related party | $ 10,711 | $ 10,711 |
Hui Xu [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship | General Manager of CACM | |
Nature | Interest-free loan, due on demand | |
Other payables & related party | $ 350,000 | |
Jehan Zeb Khan [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship | Director and Former Co-Acting CEO of the Company | |
Nature | Interest-free loan, due on demand | |
Other payables & related party | $ 2,173 |
Accounts payable (Details) - Sc
Accounts payable (Details) - Schedule of accounts payable - USD ($) | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | |
Schedule Of Accounts Payable Abstract | |||
Royal fees payable | $ 3,770,945 |
Deferred Revenue (Details) - Sc
Deferred Revenue (Details) - Schedule of deferred revenue - USD ($) | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Schedule of deferred revenue [Abstract] | ||
Color World platform subscription fees collected in advance of revenue recognition | $ 3,596,821 |
Leases (Details)
Leases (Details) - USD ($) | 12 Months Ended | ||||
Jun. 30, 2022 | Jun. 30, 2021 | May 31, 2021 | Jun. 30, 2020 | May 31, 2022 | |
Leases [Abstract] | |||||
Lease agreement, description | The Company has a new lease agreement for office space in New York from July 1, 2021 through June 30, 2022, with a rental fee of $3,300 per month. | The Company has a lease agreement for office space in New York from June 1, 2020 through May 31, 2021, with annual payments of $46,896 and converted to month to month lease in June 2021 and terminated the month to month lease on October 2021. | |||
Annual payments | $ 46,896 | ||||
Rental fee | 3,300 | $ 2,886 | |||
Operating lease expenses | $ 65,580 | $ 71,000 | $ 30,000 |
Leases (Details) - Schedule of
Leases (Details) - Schedule of lease obligations | Jun. 30, 2022 USD ($) |
Schedule of lease obligations [Abstract] | |
2023 | $ 34,626 |
Total lease payments | $ 34,626 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | |
Income Taxes (Details) [Line Items] | |||
Federal statutory income tax rate | 21% | 21% | 21% |
State | 5.60% | 5.60% | 5.60% |
Effective tax rate | 0% | 0% | 0% |
Percentage of future taxable income for unlimited years | 80% | ||
Deferred tax asset allowance, percentage | (26.60%) | (26.60%) | (26.60%) |
Deferred tax assets | $ 442,000 | $ 279,000 | |
Increased decreased in valuation allowance | $ 11,716,701 | 373,784 | |
Maximum [Member] | |||
Income Taxes (Details) [Line Items] | |||
Increased decreased in valuation allowance | 11,342,917 | $ 239,269 | |
Minimum [Member] | |||
Income Taxes (Details) [Line Items] | |||
Increased decreased in valuation allowance | 373,784 | $ 134,515 | |
Hong Kong [Member] | |||
Income Taxes (Details) [Line Items] | |||
Federal statutory income tax rate | 16.50% | ||
Net operating loss carryforward | $ 300,000 | 600,000 | |
Business Combination [Member] | |||
Income Taxes (Details) [Line Items] | |||
Business combination, description | The net operating loss carry forwards are available to reduce future years’ taxable income for unlimited years. Management believes that the realization of the benefits from these losses appears uncertain due to the Company’s operating history and continued losses in Hong Kong. If the Company is unable to generate taxable income in its Hong Kong operations, it is more likely than not that it will not have sufficient income to utilize its deferred tax assets. Accordingly, the Company has provided a 100% valuation allowance on its net deferred tax assets of approximately $11.3 million and $95,000 related to its Hong Kong operations as of June 30, 2022 and 2021, respectively. | ||
CACM and Baytao [Member] | |||
Income Taxes (Details) [Line Items] | |||
Federal statutory income tax rate | 21% | ||
State | 7.10% | ||
Effective tax rate | 26.60% | ||
Net operating loss carryforward | $ 1,500,000 | $ 900,000 | |
Deferred tax asset allowance, percentage | 100% |
Income Taxes (Details) - Schedu
Income Taxes (Details) - Schedule of Income (loss) before provision for income taxes - USD ($) | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | |
Income Taxes (Details) - Schedule of Income (loss) before provision for income taxes [Line Items] | |||
Income (loss) before provision for income taxes | $ (77,208,118) | $ (8,238,513) | $ (5,168,642) |
Cayman [Member] | |||
Income Taxes (Details) - Schedule of Income (loss) before provision for income taxes [Line Items] | |||
Income (loss) before provision for income taxes | (8,837,141) | (7,120,310) | (4,851,668) |
United States [Member] | |||
Income Taxes (Details) - Schedule of Income (loss) before provision for income taxes [Line Items] | |||
Income (loss) before provision for income taxes | (617,057) | (541,744) | (316,142) |
Hong Kong [Member] | |||
Income Taxes (Details) - Schedule of Income (loss) before provision for income taxes [Line Items] | |||
Income (loss) before provision for income taxes | $ (67,753,920) | $ (576,459) | $ (832) |
Income Taxes (Details) - Sche_2
Income Taxes (Details) - Schedule of effective income tax rate | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | |
Schedule of effective income tax rate [Abstract] | |||
Federal statutory rate | 21% | 21% | 21% |
State statutory rate | 5.60% | 5.60% | 5.60% |
Valuation allowance | (26.60%) | (26.60%) | (26.60%) |
Effective tax rate | 0% | 0% | 0% |
Income Taxes (Details) - Sche_3
Income Taxes (Details) - Schedule of components of deferred tax assets - USD ($) | Jun. 30, 2022 | Jun. 30, 2021 |
Deferred tax assets | ||
Net operating loss carryforward in the U.S. | $ 442,051 | $ 278,531 |
Net operating loss carryforward in Hong Kong | 11,274,650 | 95,253 |
Valuation allowance | (11,716,701) | (373,784) |
Total net deferred tax assets |
Shareholders_ Equity (Details)
Shareholders’ Equity (Details) | 1 Months Ended | 12 Months Ended | |||||||||||||||||||||||||||||||||
Dec. 01, 2022 | Sep. 24, 2022 | Feb. 21, 2022 | Sep. 09, 2020 USD ($) $ / shares shares | Apr. 02, 2020 | Jun. 30, 2022 USD ($) $ / shares shares | Apr. 30, 2022 USD ($) shares | Mar. 31, 2022 USD ($) $ / shares shares | Jan. 21, 2022 USD ($) $ / shares shares | Dec. 31, 2021 USD ($) shares | Aug. 31, 2021 USD ($) $ / shares shares | Jun. 30, 2021 USD ($) $ / shares shares | Mar. 31, 2021 USD ($) $ / shares shares | Feb. 28, 2021 $ / shares shares | Feb. 18, 2021 USD ($) $ / shares shares | Jan. 31, 2021 USD ($) $ / shares shares | Dec. 31, 2020 USD ($) $ / shares shares | Nov. 18, 2020 | Oct. 31, 2020 USD ($) $ / shares shares | Sep. 30, 2020 USD ($) $ / shares shares | Aug. 31, 2020 $ / shares shares | Jul. 31, 2020 USD ($) $ / shares shares | Jun. 30, 2020 $ / shares shares | May 31, 2020 USD ($) $ / shares shares | Apr. 30, 2020 shares | Mar. 31, 2020 USD ($) $ / shares shares | Feb. 29, 2020 $ / shares shares | Jan. 31, 2020 USD ($) $ / shares shares | Jul. 31, 2019 $ / shares shares | Jun. 30, 2022 USD ($) $ / shares shares | Jun. 30, 2021 USD ($) $ / shares shares | Jun. 30, 2020 USD ($) $ / shares | Mar. 27, 2021 USD ($) $ / shares shares | Mar. 25, 2021 USD ($) $ / shares shares | Jan. 31, 2020 CNY (¥) | |
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Increase in authorized shares, description | On December 1, 2021, the Company’s shareholders approved to the authorized share capital of the Company be increased from US$200,000 divided into 200,000,000 ordinary shares of a par value of US$0.001 each to US$800,000 divided into 800,000,000 ordinary shares of a par value of US$0.001 each by the creation of an additional 600,000,000 ordinary shares of a par value of US$0.001 each to rank pari passu in all respects with the existing ordinary shares. | On November 18, 2020, the Company’s shareholders approved to the authorized share capital of the Company be increased from US$75,000 divided into 75,000,000 ordinary shares of a par value of US$0.001 each to US$200,000 divided into 200,000,000 ordinary shares of a par value of US$0.001 each by the creation of an additional 125,000,000 ordinary shares of a par value of US$0.001 each to rank pari passu in all respects with the existing ordinary shares. | On March 10, 2022, the Board of Directors of the Company approved the 40-for-1 reverse share split of its ordinary shares in accordance with Cayman law and on April 11, 2022, the Company’s shareholders approved the proposal to implement a reverse share split of the Company’s ordinary shares, par value US$0.001 per share, including the Company’s ordinary shares reserved for issuance (the “Original Ordinary Shares”), at a ratio of forty (40)-for-one and at a time during the following six months to be determined by further action of our Board of Directors (or not at all in the determination of the Board of Directors during the same period), such that each 40 Original Ordinary Shares shall be consolidated into one ordinary share of the Company, par value US$0.04 (the “Adjusted Ordinary Shares”), and that the authorized share capital of the Company is consolidated from US$800,000 divided into 800,000,000 Original Ordinary Shares to US$800,000 divided into 20,000,000 Adjusted Ordinary Shares. The Company’s shareholders also approved the proposal to increase the authorized share capital of the Company at a time during the following six months to be determined by further action of the Company’s Board of Directors (or not at all in the determination of the Board of Directors during the same period) from US$800,000 divided into 20,000,000 Adjusted Ordinary Shares to US$32,000,000 divided into 800,000,000 Adjusted Ordinary Shares by the creation of an additional 780,000,000 Adjusted Ordinary Shares to rank pari passu in all respects with the Adjusted Ordinary Shares existing upon approval of the Reverse Split Proposal. The increase in authorized shares and shares reverse split became effective on September 26, 2022. | ||||||||||||||||||||||||||||||||
Shares of common stock (in Shares) | 400,000 | ||||||||||||||||||||||||||||||||||
Gross proceeds | $ | $ 16,000,000 | $ 31,000 | $ 5,200,000 | ||||||||||||||||||||||||||||||||
Ordinary shares, par value (in Dollars per share) | $ / shares | $ 0.04 | $ 0.04 | $ 0.04 | $ 0.04 | |||||||||||||||||||||||||||||||
Ordinary shares of per shares (in Dollars per share) | $ / shares | $ 40 | ||||||||||||||||||||||||||||||||||
weighted exercise price | $ | |||||||||||||||||||||||||||||||||||
Shares of common stock, fair value | $ | $ 4,165,035 | 4,096,500 | |||||||||||||||||||||||||||||||||
Stock compensation expense | $ | $ 4,200,000 | $ 4,100,000 | 1,300,000 | ||||||||||||||||||||||||||||||||
Aggregate amount | $ | $ 4,300,000 | ||||||||||||||||||||||||||||||||||
Converted total (in Shares) | 341,432 | ||||||||||||||||||||||||||||||||||
Warrant Total (in Shares) | 341,432 | ||||||||||||||||||||||||||||||||||
weighted exercise price (in Dollars per share) | $ / shares | $ 15.2 | $ 15.2 | |||||||||||||||||||||||||||||||||
Convertible warrant (in Shares) | 3,775 | ||||||||||||||||||||||||||||||||||
Description of purchase agreement | On February 18, 2021, the Company entered into certain securities purchase agreement (the “SPA”) with certain non-U.S. Persons (the “Purchasers”) as defined in Regulation S of the Securities Act of 1933, as amended pursuant to which the Company agreed to sell an aggregate of 500,000 units. Each unit consists of one restrictive ordinary share of the Company and a warrant (“SPA Warrants”) to purchase one share with an initial exercise price of $53.60 per share. The SPA Warrants are exercisable immediately upon the date of issuance at an initial exercise price of $53.60 per Share, for cash (the “Warrant Shares”). The SPA Warrants may also be exercised cashlessly if at any time after the three-month anniversary of the issuance date, there is no effective registration statement registering, or no current prospectus available for, the resale of the Warrant Shares. The SPA Warrants shall expire three years from its date of issuance. The SPA Warrants are subject to customary anti-dilution provisions reflecting stock dividends and splits or other similar transactions. The SPA Warrants are exercisable immediately, at an exercise price of $53.60 per Ordinary Share and expire 3.0 years from the date of issuance. The fair value of the SPA Warrants was $15,898,047, which was considered a direct cost of the sale of SPA and included in additional paid-in capital. The fair value has been estimated using the Black-Scholes pricing model with the following assumptions: market value of underlying share of $42.40, risk free rate of 0.21%; expected term of 3.0 years; exercise price of the warrants of $53.60, volatility of 141%; and expected future dividends of 0%. | ||||||||||||||||||||||||||||||||||
Institutional investor description | The Company issued a warrant to purchase 23,719 ordinary shares to the placement agent (the “Placement Agent Warrants”). The Investor Warrants and Placement Agent Warrants are initially exercisable at $40.00 per Ordinary Share and expire 3.0 years from the date of issuance. The fair value of the Investor Warrants and Placement Agent Warrants were $9,123,701, which was considered a direct cost of the sale of SPA and included in additional paid-in capital. The fair value has been estimated using the Black-Scholes pricing model with the following assumptions: market value of underlying share of $22.40, risk free rate of 0.55%; expected term of 3.0 years; exercise price of the warrants of $40.00, volatility of 140%; and expected future dividends of 0%. | On February 21, 2022, the Company and certain institutional investors entered into a SPA 2, pursuant to which the Company agreed to sell such institutional investors units with each unit consisting of one ordinary share and one warrant to purchase one ordinary share, at a purchase price of $16.00 per unit, for net proceeds of approximately $8.7 million (the “Offering”) before deducting placement agent fees and other estimated offering expenses. An aggregate of 625,000 ordinary shares and warrants to purchase an aggregate of 625,000 ordinary shares (the “Investor Warrants”) were agreed to be issued to the investors under the SPA 2. The Investor Warrants are initially exercisable at $16.00 per Ordinary Share and expire 5.0 years from the date of issuance. Pursuant to a placement agent agreement entered into between the Company and FT Global Capital, Inc. (“FT Global”) dated September 24, 2021 (the “September 2021 PAA”), the Company issued to FT Global warrants (the “Tail Fee Warrants”) to purchase 13,632 Ordinary Shares on substantially the same terms as the Investor Warrants sold in SPA 2, except that the Tail Fee Warrants shall not be exercisable for a period of six months and shall expire 36 months after issuance, and shall have no anti-dilution protection other than adjustments based on stock splits, stock dividends, combinations of shares and similar recapitalization transactions. The fair value of the Investor Warrants were $5,008,524, which was considered a direct cost of the sale of SPA and included in additional paid-in capital. The fair value has been estimated using the Black-Scholes pricing model with the following assumptions: market value of underlying share of $9.20, risk free rate of 1.84%; expected term of 5.0 years; exercise price of the warrants of $16.00, volatility of 146%; and expected future dividends of 0%. The fair value of the Tail Fee Warrants were $92,251, which was considered a direct cost of the sale of SPA and included in additional paid-in capital. The fair value has been estimated using the Black-Scholes pricing model with the following assumptions: market value of underlying share of $9.20, risk free rate of 1.73%; expected term of 3.0 years; exercise price of the warrants of $16.00, volatility of 145%; and expected future dividends of 0%. | |||||||||||||||||||||||||||||||||
Warrant [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Shares of common stock (in Shares) | 80,625 | ||||||||||||||||||||||||||||||||||
Total proceeds | $ | $ 3,800,000 | ||||||||||||||||||||||||||||||||||
Offering cost | $ | $ 400,000 | ||||||||||||||||||||||||||||||||||
Ordinary shares, issued (in Shares) | 52,407 | ||||||||||||||||||||||||||||||||||
Warrant One [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Shares of common stock (in Shares) | 330,000 | ||||||||||||||||||||||||||||||||||
Total proceeds | $ | $ 6,000,000 | ||||||||||||||||||||||||||||||||||
Offering cost | $ | $ 600,000 | ||||||||||||||||||||||||||||||||||
Purchase of warrants (in Shares) | 297,000 | ||||||||||||||||||||||||||||||||||
Minimum [Member] | Warrant [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Warrant exercise price (in Dollars per share) | $ / shares | $ 52 | ||||||||||||||||||||||||||||||||||
Minimum [Member] | Warrant One [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Warrant exercise price (in Dollars per share) | $ / shares | $ 22 | ||||||||||||||||||||||||||||||||||
Maximum [Member] | Warrant [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Warrant exercise price (in Dollars per share) | $ / shares | $ 60 | ||||||||||||||||||||||||||||||||||
Maximum [Member] | Warrant One [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Warrant exercise price (in Dollars per share) | $ / shares | $ 20 | ||||||||||||||||||||||||||||||||||
Purchaser an Aggregate [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Shares of common stock (in Shares) | 794 | 79,366 | |||||||||||||||||||||||||||||||||
Stock price per share (in Dollars per share) | $ / shares | $ 25.2 | ||||||||||||||||||||||||||||||||||
Offering cost | $ | $ 40,000 | ||||||||||||||||||||||||||||||||||
Gross proceeds | $ | $ 2,000,000 | ||||||||||||||||||||||||||||||||||
Installment due amount | $ | $ 500,000 | ||||||||||||||||||||||||||||||||||
Ordinary shares issued (in Shares) | 19,842 | ||||||||||||||||||||||||||||||||||
Total proceeds | $ | $ 460,000 | ||||||||||||||||||||||||||||||||||
Conversion of Warrants Ordinary Shares [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Restricted common stock, shares (in Shares) | 3,775 | ||||||||||||||||||||||||||||||||||
weighted exercise price | $ | $ 8.34 | ||||||||||||||||||||||||||||||||||
Direct Offering Warrants [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Warrants, description | The warrants are exercisable immediately, at an exercise price of $22.00 per Ordinary Share and expire 5.5 years from the date of issuance. The fair value of this Direct Offering Warrants was $916,334, which was considered a direct cost of the direct offering and included in additional paid-in capital. The fair value has been estimated using the Black-Scholes pricing model with the following assumptions: market value of underlying share of $16.40, risk free rate of 0.43%; expected term of 5.5 years; exercise price of the warrants of $22.00, volatility of 120%; and expected future dividends of 0%. In June 2020, the exercise price of the warrants was amended and changed to $1.60 per Ordinary Share as a result of the May 13, 2020 direct offering. | the Company also sold warrants (“Direct Offering Warrants”) to purchase an aggregate of up to an aggregate of 65,000 ordinary shares to certain institutional investors on May 11, 2020. The warrants are exercisable immediately, at an exercise price of $22.00 per Ordinary Share and expire 5.5 years from the date of issuance. The fair value of this Direct Offering Warrants was $860,826, which was considered a direct cost of the direct offering and included in additional paid-in capital. The fair value has been estimated using the Black-Scholes pricing model with the following assumptions: market value of underlying share of $16.0, risk free rate of 0.36%; expected term of 5.5 years; exercise price of the warrants of $22.00, volatility of 123%; and expected future dividends of 0%. In August 2020, the exercise price of the warrants was amended and changed to $7.40 per Ordinary Share as a result of the July 20, 2020 direct offering.In a connection with the private placement in July 2020 for the sale of 80,625 ordinary shares, the Company also sold warrants (“Direct Offering Warrants”) to purchase an aggregate of up to an aggregate of 52,406 ordinary shares to certain institutional investors on July 20, 2020. The warrants are exercisable immediately, at an exercise price of $60.00 per Ordinary Share and expire 5.5 years from the date of issuance. | In a connection with the direct offering in March 2020 with the sales of 68,182 ordinary shares, the Company also sold warrants (“Direct Offering Warrants”) to purchase an aggregate of up to an aggregate of 68,182 ordinary shares to certain institutional investors on April 2, 2020. | The fair value of this Direct Offering Warrants was $2,901,119, which was considered a direct cost of the direct offering and included in additional paid-in capital. The fair value has been estimated using the Black-Scholes pricing model with the following assumptions: market value of underlying share of $63.60, risk free rate of 0.34%; expected term of 5.5 years; exercise price of the warrants of $60.00, volatility of 128%; and expected future dividends of 0%.In a connection with the private placement in September 2020 for the sale of 330,000 ordinary shares, the Company also sold warrants (“Direct Offering Warrants”) to purchase an aggregate of up to an aggregate of 297,000 ordinary shares to certain institutional investors on September 15, 2020. The warrants are exercisable immediately, at an exercise price of $22.00 per Ordinary Share and expire 5.5 years from the date of issuance. The fair value of this Direct Offering Warrants was $8,403,557, which was considered a direct cost of the direct offering and included in additional paid-in capital. The fair value has been estimated using the Black-Scholes pricing model with the following assumptions: market value of underlying share of $31.60, risk free rate of 0.32%; expected term of 5.5 years; exercise price of the warrants of $22.00, volatility of 130%; and expected future dividends of 0%. | |||||||||||||||||||||||||||||||
SPA 1 [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Securities purchase agreement | On September 24, 2021, the Company and certain institutional investors entered into a securities purchase agreement (“SPA 1”), pursuant to which the Company agreed to sell such institutional investors units with each unit consisting of one ordinary share and one warrant to purchase 0.7 ordinary share, at a purchase price of $27.20 per unit, for net proceeds of approximately $19.2 million (the “Offering”). An aggregate of 790,624 ordinary shares and warrants to purchase an aggregate of 553,437 ordinary shares (the “Investor Warrants”) were agreed to be issued to the investors under the SPA 1. The Offering closed on September 28, 2021. | ||||||||||||||||||||||||||||||||||
SPA 2 [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Securities purchase agreement | On February 21, 2022, the Company and certain institutional investors entered into a securities purchase agreement (“SPA 2”), pursuant to which the Company agreed to sell such institutional investors units with each unit consisting of one ordinary share and one warrant to purchase one ordinary share, at a purchase price of $16.00 per unit, for net proceeds of approximately $8.7 million (the “Offering”). An aggregate of 625,000 ordinary shares and warrants to purchase an aggregate of 625,000 ordinary shares (the “Investor Warrants”) were agreed to be issued to the investors under the SPA 2. The Offering closed on February 24, 2022. | ||||||||||||||||||||||||||||||||||
First Purchase Agreement [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Ordinary shares, par value (in Dollars per share) | $ / shares | $ 0.04 | ||||||||||||||||||||||||||||||||||
Ordinary shares of per shares (in Dollars per share) | $ / shares | $ 52 | ||||||||||||||||||||||||||||||||||
First Purchase Agreement [Member] | First Private Placement [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Offering cost | $ | $ 3,900,000 | ||||||||||||||||||||||||||||||||||
Ordinary shares, issued (in Shares) | 75,500 | ||||||||||||||||||||||||||||||||||
Second Purchase Agreement [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Ordinary shares, par value (in Dollars per share) | $ / shares | $ 0.04 | ||||||||||||||||||||||||||||||||||
Ordinary shares of per shares (in Dollars per share) | $ / shares | $ 52 | ||||||||||||||||||||||||||||||||||
Second Purchase Agreement [Member] | Second Private Placement [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Offering cost | $ | $ 4,550,000 | ||||||||||||||||||||||||||||||||||
Ordinary shares, issued (in Shares) | 87,500 | ||||||||||||||||||||||||||||||||||
Third Purchase Agreement [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Ordinary shares, par value (in Dollars per share) | $ / shares | $ 0.04 | ||||||||||||||||||||||||||||||||||
Ordinary shares of per shares (in Dollars per share) | $ / shares | $ 52 | ||||||||||||||||||||||||||||||||||
Third Purchase Agreement [Member] | Third Private Placement [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Offering cost | $ | $ 3,900,000 | ||||||||||||||||||||||||||||||||||
Ordinary shares, issued (in Shares) | 75,000 | ||||||||||||||||||||||||||||||||||
Fourth Purchase Agreement [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Ordinary shares, par value (in Dollars per share) | $ / shares | $ 0.04 | ||||||||||||||||||||||||||||||||||
Ordinary shares of per shares (in Dollars per share) | $ / shares | $ 52 | ||||||||||||||||||||||||||||||||||
Fourth Purchase Agreement [Member] | Fourth Private Placement [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Offering cost | $ | $ 4,550,000 | ||||||||||||||||||||||||||||||||||
Ordinary shares, issued (in Shares) | 87,500 | ||||||||||||||||||||||||||||||||||
Fifth Purchase Agreement [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Ordinary shares, par value (in Dollars per share) | $ / shares | $ 0.04 | ||||||||||||||||||||||||||||||||||
Ordinary shares of per shares (in Dollars per share) | $ / shares | $ 52 | ||||||||||||||||||||||||||||||||||
Fifth Purchase Agreement [Member] | Fifth Private Placement [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Offering cost | $ | $ 4,550,000 | ||||||||||||||||||||||||||||||||||
Ordinary shares, issued (in Shares) | 87,500 | ||||||||||||||||||||||||||||||||||
Sixth Purchase Agreement [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Ordinary shares, par value (in Dollars per share) | $ / shares | $ 0.04 | ||||||||||||||||||||||||||||||||||
Ordinary shares of per shares (in Dollars per share) | $ / shares | $ 52 | ||||||||||||||||||||||||||||||||||
Sixth Purchase Agreement [Member] | Sixth Private Placement [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Offering cost | $ | $ 4,550,000 | ||||||||||||||||||||||||||||||||||
Ordinary shares, issued (in Shares) | 87,500 | ||||||||||||||||||||||||||||||||||
Restricted Stock [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Compensation expense related to restricted stock grants | $ | $ 600,000 | $ 1,100,000 | 600,000 | ||||||||||||||||||||||||||||||||
Third Party to Purchase Certain Machinery [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Shares of common stock (in Shares) | 151,508 | ||||||||||||||||||||||||||||||||||
Closing price (in Dollars per share) | $ / shares | $ 34 | $ 25.2 | |||||||||||||||||||||||||||||||||
Third Party to Purchase Certain Copyrights [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Shares of common stock (in Shares) | 45,371 | ||||||||||||||||||||||||||||||||||
SAP [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Shares of common stock (in Shares) | 500,000 | ||||||||||||||||||||||||||||||||||
Offering cost | $ | $ 26,000,000 | ||||||||||||||||||||||||||||||||||
Ordinary shares, par value (in Dollars per share) | $ / shares | $ 0.04 | ||||||||||||||||||||||||||||||||||
Warrant exercise price (in Dollars per share) | $ / shares | 1.34 | ||||||||||||||||||||||||||||||||||
SAP [Member] | Minimum [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Stock price per share (in Dollars per share) | $ / shares | 52 | ||||||||||||||||||||||||||||||||||
SAP [Member] | Maximum [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Stock price per share (in Dollars per share) | $ / shares | $ 53.6 | ||||||||||||||||||||||||||||||||||
Chief Executive Officer [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Stock price per share (in Dollars per share) | $ / shares | $ 61.6 | ||||||||||||||||||||||||||||||||||
Aggregate shares of common stock (in Shares) | 15,849 | ||||||||||||||||||||||||||||||||||
Aggregate amount | $ | $ 976,255 | ||||||||||||||||||||||||||||||||||
Chief Executive Officer [Member] | Restricted Stock [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Restricted common stock, shares (in Shares) | 2,500 | 10,000 | |||||||||||||||||||||||||||||||||
weighted exercise price | $ | $ 11,200 | ||||||||||||||||||||||||||||||||||
Unvested restricted shares (in Shares) | 3,750 | ||||||||||||||||||||||||||||||||||
Initial fair value | $ | $ 168,000 | ||||||||||||||||||||||||||||||||||
Vice President [Member] | Restricted Stock [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
weighted exercise price | $ | $ 45,900 | ||||||||||||||||||||||||||||||||||
Board Granted [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Restricted common stock, shares (in Shares) | 17,500 | ||||||||||||||||||||||||||||||||||
weighted exercise price | $ | $ 441,000 | ||||||||||||||||||||||||||||||||||
Aggregate shares of common stock (in Shares) | 39,750 | ||||||||||||||||||||||||||||||||||
Shares of common stock, fair value | $ | $ 1,128,900 | ||||||||||||||||||||||||||||||||||
Closing price (in Dollars per share) | $ / shares | $ 28.4 | $ 25.2 | |||||||||||||||||||||||||||||||||
Stock compensation expense | $ | $ 0 | $ 500,000 | $ 2,800,000 | ||||||||||||||||||||||||||||||||
Thirteen Employees [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Aggregate shares of common stock (in Shares) | 54,000 | ||||||||||||||||||||||||||||||||||
Shares of common stock, fair value | $ | $ 1,836,000 | ||||||||||||||||||||||||||||||||||
Closing price (in Dollars per share) | $ / shares | $ 34 | ||||||||||||||||||||||||||||||||||
Nine Employees [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Aggregate shares of common stock (in Shares) | 34,500 | ||||||||||||||||||||||||||||||||||
Shares of common stock, fair value | $ | $ 1,131,600 | ||||||||||||||||||||||||||||||||||
Closing price (in Dollars per share) | $ / shares | $ 32.8 | ||||||||||||||||||||||||||||||||||
Twenty-one employees [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Aggregate shares of common stock (in Shares) | 93,875 | ||||||||||||||||||||||||||||||||||
Shares of common stock, fair value | $ | $ 3,030,285 | ||||||||||||||||||||||||||||||||||
Closing price (in Dollars per share) | $ / shares | $ 32.28 | ||||||||||||||||||||||||||||||||||
Twenty employees [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Aggregate shares of common stock (in Shares) | 106,250 | ||||||||||||||||||||||||||||||||||
Closing price (in Dollars per share) | $ / shares | $ 10.68 | ||||||||||||||||||||||||||||||||||
Amortization of deferred stock compensation | $ | $ 1,134,750 | ||||||||||||||||||||||||||||||||||
Two Service Providers [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Shares of common stock (in Shares) | 1,400,000 | ||||||||||||||||||||||||||||||||||
Aggregate shares of common stock (in Shares) | 10,000 | ||||||||||||||||||||||||||||||||||
Closing price (in Dollars per share) | $ / shares | $ 140 | ||||||||||||||||||||||||||||||||||
Two Employees [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Aggregate amount | ¥ | ¥ 29,429,627 | ||||||||||||||||||||||||||||||||||
Third-Party Individuals [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Shares of common stock (in Shares) | 65,000 | 68,182 | 50,000 | 25,756 | |||||||||||||||||||||||||||||||
Stock price per share (in Dollars per share) | $ / shares | $ 22 | $ 22 | $ 40 | ||||||||||||||||||||||||||||||||
Total proceeds | $ | $ 1,200,000 | $ 1,300,000 | $ 2,000,000 | ||||||||||||||||||||||||||||||||
Offering cost | $ | $ 200,000 | $ 200,000 | |||||||||||||||||||||||||||||||||
Executive Vice President [Member] | Restricted Stock [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Restricted common stock, shares (in Shares) | 4,500 | ||||||||||||||||||||||||||||||||||
Vice President [Member] | Restricted Stock [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
weighted exercise price | $ | $ 84,600 | ||||||||||||||||||||||||||||||||||
Chief Executive Officer [Member] | Restricted Stock [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Restricted common stock, shares (in Shares) | 7,500 | ||||||||||||||||||||||||||||||||||
weighted exercise price | $ | $ 522,000 | ||||||||||||||||||||||||||||||||||
Ms. Lili Jiang [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Restricted common stock, shares (in Shares) | 3,000 | ||||||||||||||||||||||||||||||||||
weighted exercise price | $ | $ 27,360 | ||||||||||||||||||||||||||||||||||
Mr. Biao Lu [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Restricted common stock, shares (in Shares) | 2,500 | ||||||||||||||||||||||||||||||||||
weighted exercise price | $ | $ 13,000 | ||||||||||||||||||||||||||||||||||
Hou Sing [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Shares of common stock (in Shares) | 6,908 | ||||||||||||||||||||||||||||||||||
Aggregate shares of common stock (in Shares) | 69,228 | ||||||||||||||||||||||||||||||||||
Sunway Kids [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Shares of common stock (in Shares) | 49,732 | ||||||||||||||||||||||||||||||||||
Closing price (in Dollars per share) | $ / shares | $ 38 | ||||||||||||||||||||||||||||||||||
Color China [Member] | |||||||||||||||||||||||||||||||||||
Shareholders’ Equity (Details) [Line Items] | |||||||||||||||||||||||||||||||||||
Shares of common stock (in Shares) | 115,834 | ||||||||||||||||||||||||||||||||||
Closing price (in Dollars per share) | $ / shares | $ 17 | $ 17 |
Shareholders_ Equity (Details)
Shareholders’ Equity (Details) - Schedule of restricted stock grants - Restricted Stock [Member] - USD ($) | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | |
Shareholders’ Equity (Details) - Schedule of restricted stock grants [Line Items] | |||
Shares, Unvested Beginning | 12,146 | 13,875 | 16,500 |
Weighted Average Grant Date Fair Value Per Share, Unvested Beginning | $ 56 | $ 82.4 | $ 102.8 |
Aggregate Intrinsic Value, Unvested Beginning | |||
Shares, Forfeited | (3,750) | (3,000) | |
Weighted Average Grant Date Fair Value Per Share, Forfeited | $ 44.8 | $ 2.57 | |
Aggregate Intrinsic Value, Forfeited | |||
Shares, Granted | 4,500 | ||
Weighted Average Grant Date Fair Value Per Share, Granted | $ 102.8 | ||
Aggregate Intrinsic Value, Granted | |||
Shares, Granted | 8,000 | 17,500 | |
Weighted Average Grant Date Fair Value Per Share, Granted | $ 10.8 | $ 55.6 | $ 18.8 |
Aggregate Intrinsic Value, Granted | |||
Shares, Vested | (11,750) | (16,229) | (7,125) |
Weighted Average Grant Date Fair Value Per Share, Vested | $ 48.4 | $ 74.8 | $ 211.2 |
Aggregate Intrinsic Value, Vested | |||
Shares, Unvested Ending | 4,646 | 12,146 | 13,875 |
Weighted Average Grant Date Fair Value Per Share, Unvested Ending | $ 7.2 | $ 56 | $ 82.4 |
Aggregate Intrinsic Value, Unvested Ending |
Shareholders_ Equity (Details_2
Shareholders’ Equity (Details) - Schedule of warrant activity - Warrant [Member] - $ / shares | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Shareholders’ Equity (Details) - Schedule of warrant activity [Line Items] | ||
Warrants Outstanding, Beginning balance | 641,157 | 133,182 |
Weighted Average Exercise Price, Beginning balance | $ 49.6 | $ 11.6 |
Average Remaining Contractual Life, Beginning balance | 5 years 3 months 21 days | |
Warrants Outstanding, Granted | 1,215,788 | 849,407 |
Weighted Average Exercise Price, Granted | $ 52 | $ 42.8 |
Average Remaining Contractual Life, Granted | 4 years 7 days | 3 years 5 months 23 days |
Warrants Outstanding, Forfeited | ||
Weighted Average Exercise Price, Forfeited | ||
Average Remaining Contractual Life, Forfeited | ||
Warrants Outstanding, Exercised | (341,432) | |
Weighted Average Exercise Price, Exercised | $ 15.2 | |
Average Remaining Contractual Life, Exercised | ||
Warrants Outstanding, Ending balance | 1,856,945 | 641,157 |
Weighted Average Exercise Price, Ending balance | $ 35.2 | $ 49.6 |
Average Remaining Contractual Life, Ending balance | 2 years 11 months 26 days | 3 years 29 days |
Concentrations of Risk (Details
Concentrations of Risk (Details) | 12 Months Ended | ||
Jun. 30, 2022 USD ($) | Jun. 30, 2022 HKD ($) | Jun. 30, 2021 USD ($) | |
Concentrations of Risk (Details) [Line Items] | |||
Deposited from banks (in Dollars) | $ 300,000 | $ 0 | |
Insurance coverage of each bank | $ 250,000 | $ 500,000 | |
Accounts payable percentage | 100% | 100% | |
Vendor concentration risk percentage | 89% | ||
Vendors One [Member] | |||
Concentrations of Risk (Details) [Line Items] | |||
Vendor concentration risk percentage | 60% | 60% | |
Vendors Two [Member] | |||
Concentrations of Risk (Details) [Line Items] | |||
Vendor concentration risk percentage | 27% | 27% | |
Vendors Three [Member] | |||
Concentrations of Risk (Details) [Line Items] | |||
Vendor concentration risk percentage | 13% | 13% | |
Hong Kong [Member] | |||
Concentrations of Risk (Details) [Line Items] | |||
Insurance coverage of each bank | $ 64,000 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |||
Sep. 14, 2022 | Aug. 11, 2022 | Jan. 21, 2022 | Jun. 30, 2022 | Jun. 30, 2021 | |
Subsequent Events (Details) [Line Items] | |||||
Purchase price | $ 40 | ||||
Gross proceeds | $ 16,000,000 | $ 31,000 | $ 5,200,000 | ||
Warrant expire | 5 years | ||||
Forecast [Member] | |||||
Subsequent Events (Details) [Line Items] | |||||
Purchase price | $ 3.2 | ||||
Gross proceeds | $ 5,600,000 | ||||
Aggregate of ordinary shares | 1,750,000 | ||||
Sale of ordinary shares and warrants description | Pursuant to a placement agent agreement entered into between the Company and FT Global Capital, Inc. (“FT Global”) dated September 24, 2021 (the “September 2021 PAA”), the Company issued to FT Global warrants (the “Tail Fee Warrants”) to purchase 43,125 Ordinary Shares on substantially the same terms as the Investor Warrants sold in SPA 3, except that the Tail Fee Warrants shall not be exercisable for a period of six months and shall expire 36 months after issuance, and shall have no anti-dilution protection other than adjustments based on stock splits, stock dividends, combinations of shares and similar recapitalization transactions. | ||||
Incorporation state percentage | 100% | ||||
Investor [Member] | Forecast [Member] | |||||
Subsequent Events (Details) [Line Items] | |||||
Aggregate of ordinary shares | 1,750,000 | ||||
Warrants exercisable | $ 3.2 |
Condensed Financial Informati_3
Condensed Financial Information of the Parent Company (Details) - Schedule of parent company balance sheets - Parent [Member] - USD ($) | Jun. 30, 2022 | Jun. 30, 2021 |
CURRENT ASSETS: | ||
Cash | $ 470,634 | $ 26,636 |
Other receivables | 8,900 | |
Prepayments and advances | 4,300 | |
Total current assets | 470,634 | 39,836 |
OTHER ASSETS: | ||
Intercompany receivable | 114,222,952 | 74,858,613 |
Investment in subsidiaries | 2,459,560 | |
Total other assets | 114,222,952 | 77,318,173 |
Total assets | 114,693,586 | 77,358,009 |
CURRENT LIABILITIES: | ||
Other payables and accrued liabilities | 327,694 | 396,797 |
Other payables - shareholders | 10,711 | 10,711 |
Total current liabilities | 338,405 | 407,508 |
OTHER LIABILITIES | ||
Deficit of investment in subsidiaries | 65,911,417 | |
Total liabilities | 66,249,822 | 407,508 |
COMMITMENTS AND CONTINGENCIES | ||
SHAREHOLDERS’ EQUITY: | ||
Ordinary share, $0.04 par value, 800,000,000 shares authorized, 4,819,700 and 2,758,920 shares issued and outstanding as of June 30, 2022 and 2021, respectively | 192,788 | 110,357 |
Additional paid-in-capital | 195,654,317 | 147,684,772 |
Deferred stock compensation | (32,978) | (682,383) |
Deficit | (147,370,363) | (70,162,245) |
Total shareholders’ equity | 48,443,764 | 76,950,501 |
Total liabilities and shareholders’ equity | $ 114,693,586 | $ 77,358,009 |
Condensed Financial Informati_4
Condensed Financial Information of the Parent Company (Details) - Schedule of parent company balance sheets (Parentheticals) - Parent [Member] - $ / shares | Jun. 30, 2022 | Jun. 30, 2021 |
Condensed Balance Sheet Statements, Captions [Line Items] | ||
Ordinary shares, par value (in Dollars per share) | $ 0.04 | $ 0.04 |
Ordinary shares, shares authorized | 800,000,000 | 800,000,000 |
Ordinary shares, shares issued | 4,819,700 | 2,758,920 |
Ordinary shares, shares outstanding | 4,819,700 | 2,758,920 |
Condensed Financial Informati_5
Condensed Financial Information of the Parent Company (Details) - Schedule of parent company statements of operations and comprehensive loss - Parent [Member] - USD ($) | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | |
Condensed Statement of Income Captions [Line Items] | |||
GENERAL AND ADMINISTRATIVE EXPENSES | $ (4,098,934) | $ (2,821,121) | $ (1,402,044) |
STOCK COMPENSATION EXPENSE | (4,732,700) | (5,717,900) | (3,444,617) |
LOSS FROM OPERATIONS | (8,831,634) | (8,539,021) | (4,846,661) |
OTHER INCOME (EXPENSE), NET | |||
Finance expense | (5,507) | (6,480) | (5,007) |
Equity loss of subsidiaries | (68,370,977) | (1,118,204) | (12,562,142) |
Gain on debt settlement | 25,092 | ||
Gain on sale of subsidiaries | 1,400,100 | 5,787,213 | |
TOTAL OTHER INCOME (EXPENSE), NET | (68,376,484) | 300,508 | (6,779,936) |
NET LOSS | $ (77,208,118) | $ (8,238,513) | $ (11,626,597) |
Condensed Financial Informati_6
Condensed Financial Information of the Parent Company (Details) - Schedule of parent company statements of cash flows - Parent [Member] - USD ($) | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net loss | $ (77,208,118) | $ (8,238,513) | $ (11,626,597) |
Adjustments to reconcile net loss to cash used in operating activities: | |||
Stock compensation expense | 4,732,700 | 5,717,900 | 3,444,617 |
Equity loss of subsidiaries | 68,370,977 | 1,118,204 | 12,562,142 |
Gain on debt settlement | (25,092) | ||
Gain on sale of discontinued operations | (1,400,100) | (5,787,213) | |
Changes in operating assets and liabilities | |||
Other receivables | 8,900 | (6,600) | |
Prepayments and advances | 4,300 | (4,300) | (125,000) |
Intercompany receivables | (39,364,339) | (65,500,903) | (1,231,449) |
Other payables and accrued liabilities | (69,103) | 60,090 | 93,711 |
Net cash used in operating activities | (43,524,683) | (68,279,314) | (2,669,789) |
CASH FLOWS FROM INVESTING ACTIVITIES: | |||
Purchase of equipment | (2,000,000) | ||
Proceeds from disposal of subsidiaries | 100 | 600,000 | |
Net cash provided by (used in) investing activities | 100 | (1,400,000) | |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Borrowings from shareholders | 300,000 | ||
Borrowings from related parties | |||
Proceeds from sale of ordinary shares | 43,937,202 | 62,341,025 | 4,502,901 |
Proceeds from exercise of warrants | 31,479 | 5,171,591 | |
Net cash provided by financing activities | 43,968,681 | 67,512,616 | 4,802,901 |
NET CHANGE IN CASH | 443,998 | (766,598) | 733,112 |
CASH, beginning of year | 26,636 | 793,234 | 60,122 |
CASH, end of year | 470,634 | 26,636 | 793,234 |
NON-CASH TRANSACTIONS OF INVESTING AND FINANCING ACTIVITIES: | |||
Ordinary shares issued to repay other payables – related parties and service providers | 1,137,378 | ||
Ordinary shares issued to repay debt in subsidiary | 5,240,679 | ||
Ordinary share issued for acquisition of subsidiary | 1,889,799 | ||
Ordinary share issued for acquisition of equipment | 3,818,000 | 1,963,607 | |
Ordinary share issued for acquisition of intangible assets held in a subsidiary | 1,550,000 | ||
Other receivables outstanding from disposal of subsidiary | 1,000,000 | ||
Forgiveness of former subsidiary’s receivable upon disposal of subsidiary | 120,000 | ||
Recognition of accrued liabilities from subsidiary | 214,792 | ||
Derecognition of intercompany balance upon disposal of subsidiary | 23,164,488 | ||
Proceeds from disposal of subsidiary received by intercompany | $ 1,400,000 |