Cover
Cover | 12 Months Ended |
Dec. 31, 2023 shares | |
Entity Addresses [Line Items] | |
Document Type | 20-F |
Amendment Flag | false |
Document Registration Statement | false |
Document Annual Report | true |
Document Transition Report | false |
Document Shell Company Report | false |
Document Period End Date | Dec. 31, 2023 |
Document Fiscal Period Focus | FY |
Document Fiscal Year Focus | 2023 |
Current Fiscal Year End Date | --12-31 |
Entity File Number | 001-42007 |
Entity Registrant Name | CDT Environmental Technology Investment Holdings Limited |
Entity Central Index Key | 0001793895 |
Entity Incorporation, State or Country Code | E9 |
Entity Address, Address Line One | C1, 4th Floor, Building 1 |
Entity Address, Address Line Two | Financial Base, No. 8 Kefa Road |
Entity Address, Address Line Three | Nanshan District |
Entity Address, City or Town | Shenzhen |
Entity Address, Country | CN |
Entity Address, Postal Zip Code | 518057 |
Title of 12(b) Security | Ordinary Shares, par value $0.0025 per share |
Trading Symbol | CDTG |
Security Exchange Name | NASDAQ |
Entity Well-known Seasoned Issuer | No |
Entity Voluntary Filers | No |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Filer Category | Non-accelerated Filer |
Entity Emerging Growth Company | true |
Elected Not To Use the Extended Transition Period | false |
Document Accounting Standard | U.S. GAAP |
Entity Shell Company | false |
Entity Common Stock, Shares Outstanding | 9,200,000 |
ICFR Auditor Attestation Flag | false |
Document Financial Statement Error Correction [Flag] | false |
Auditor Firm ID | 6907 |
Auditor Name | Enrome LLP |
Auditor Location | Singapore |
Business Contact [Member] | |
Entity Addresses [Line Items] | |
Entity Address, Address Line One | C1, 4th Floor, Building 1 |
Entity Address, Address Line Two | Financial Base, No. 8 Kefa Road |
Entity Address, Address Line Three | Nanshan District |
Entity Address, City or Town | Shenzhen |
Entity Address, Country | CN |
Entity Address, Postal Zip Code | 518057 |
Country Region | 86 |
City Area Code | 0755 |
Local Phone Number | 86667996 |
Contact Personnel Name | Yunwu Li |
Contact Personnel Email Address | liyunwu@cdthb.cn |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 |
CURRENT ASSETS | ||
Cash | $ 268,102 | $ 199,864 |
Accounts receivable, net | 29,076,549 | 20,090,775 |
Other receivables, net | 418,891 | 208,704 |
Other receivables - related parties | 115,718 | 289,676 |
Loans to third parties | 0 | 57,433 |
Contract assets | 34,280,084 | 16,821,489 |
Contract costs | 0 | 899,662 |
Deferred costs | 0 | 45,727 |
Prepayments and other current assets, net | 582,149 | 2,354,769 |
Total current assets | 64,741,493 | 40,968,099 |
OTHER ASSETS | ||
Property and equipment, net | 1,695,348 | 2,196,836 |
Right-of-use assets, net | 210,058 | 310,443 |
Intangible assets, net | 16,397 | 28,164 |
Deferred tax assets, net | 252,882 | 304,467 |
Contract assets, noncurrent | 4,885,755 | 9,268,901 |
Prepaid initial public offering (“IPO”) costs | 989,628 | 833,817 |
Total other assets | 8,050,068 | 12,942,628 |
Total assets | 72,791,561 | 53,910,727 |
CURRENT LIABILITIES | ||
Accounts payable | 23,784,781 | 14,862,676 |
Short-term loans - banks | 2,728,385 | 843,911 |
Short-term loans - third parties | 312,028 | 453,867 |
Short-term loans - related parties | 5,386,156 | 4,231,368 |
Other payables and accrued liabilities | 2,466,501 | 2,426,520 |
Other payables - related parties | 270,806 | 271,132 |
Contract liabilities | 28,430 | 29,196 |
Taxes payable | 5,423,955 | 4,863,577 |
Lease liabilities | 118,833 | 87,212 |
Total current liabilities | 40,519,875 | 28,069,459 |
OTHER LIABILITIES | ||
Long-term loan - bank | 79,463 | 47,861 |
Lease liabilities, non-current | 105,980 | 233,496 |
Total other liabilities | 185,443 | 281,357 |
Total liabilities | 40,705,318 | 28,350,816 |
COMMITMENTS AND CONTINGENCIES | ||
SHAREHOLDERS’ EQUITY | ||
Ordinary shares, $0.0025 par value, 20,000,000 shares authorized, and 9,200,000 shares outstanding as of December 31, 2023 and December 31, 2022, respectively | 23,000 | 23,000 |
Additional paid-in capital | 7,453,265 | 7,453,265 |
Statutory reserves | 3,192,855 | 2,396,539 |
Retained earnings | 23,242,946 | 16,621,556 |
Accumulated other comprehensive loss | (2,009,421) | (1,490,621) |
Total CDT Environmental Technology Investment Holdings Limited shareholders’ equity | 31,902,645 | 25,003,739 |
Noncontrolling interests | 183,598 | 556,172 |
Total shareholders’ equity | 32,086,243 | 25,559,911 |
Total liabilities and shareholders’ equity | $ 72,791,561 | $ 53,910,727 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Common stock, par value | $ 0.0025 | $ 0.0025 |
Common stock, shares authorized | 20,000,000 | 20,000,000 |
Common stock, shares outstanding | 9,200,000 | 9,200,000 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
REVENUES | |||
Total revenues | $ 34,209,919 | $ 28,849,362 | $ 23,556,820 |
COST OF REVENUES | |||
Total cost of revenues | 22,825,033 | 18,596,207 | 15,062,490 |
GROSS PROFIT | 11,384,886 | 10,253,155 | 8,494,330 |
OPERATING EXPENSES: | |||
Selling | 106,147 | 164,583 | 177,147 |
General and administrative | 2,674,519 | 3,150,512 | 2,400,318 |
Research and development | 80,948 | 112,668 | 136,690 |
(Recovery from) Provision for credit loss, net | (88,221) | 471,454 | (1,865,622) |
Total operating expenses | 2,773,393 | 3,899,217 | 848,533 |
INCOME FROM OPERATIONS | 8,611,493 | 6,353,938 | 7,645,797 |
OTHER INCOME (EXPENSE) | |||
Interest income | 15,510 | 13,437 | 89,510 |
Interest expense | (106,130) | (64,658) | (68,656) |
Other (expense) income, net | (92,939) | 93,035 | 119,419 |
Total other (expense) income, net | (183,559) | 41,814 | 140,273 |
INCOME BEFORE INCOME TAXES | 8,427,934 | 6,395,752 | 7,786,070 |
INCOME TAXES EXPENSE | 1,403,880 | 1,152,963 | 1,207,810 |
NET INCOME | 7,024,054 | 5,242,789 | 6,578,260 |
Less: net loss attributable to noncontrolling interest | (393,652) | (539,229) | (197,479) |
NET INCOME ATTRIBUTABLE TO CDT ENVIRONMENTAL TECHNOLOGY INVESTMENT HOLDINGS LIMITED | 7,417,706 | 5,782,018 | 6,775,739 |
FOREIGN CURRENCY TRANSLATION ADJUSTMENT | (497,722) | (2,110,311) | 428,196 |
TOTAL COMPREHENSIVE INCOME | 6,526,332 | 3,132,478 | 7,006,456 |
Less: Comprehensive loss attributable to noncontrolling interest | (372,574) | (599,166) | (116,532) |
COMPREHENSIVE INCOME ATTRIBUTABLE TO CDT ENVIRONMENTAL TECHNOLOGY INVESTMENT HOLDINGS LIMITED | $ 6,898,906 | $ 3,731,644 | $ 7,122,988 |
WEIGHTED AVERAGE NUMBER OF ORDINARY SHARES | |||
WEIGHTED AVERAGE NUMBER OF ORDINARY SHARES - Basic | 9,200,000 | 9,200,000 | 9,200,000 |
WEIGHTED AVERAGE NUMBER OF ORDINARY SHARES - Diluted | 9,200,000 | 9,200,000 | 9,200,000 |
EARNINGS PER SHARE | |||
EARNINGS PER SHARE - Basic | $ 0.81 | $ 0.63 | $ 0.74 |
EARNINGS PER SHARE - Diluted | $ 0.81 | $ 0.63 | $ 0.74 |
Sewage Treatment Systems [Member] | |||
REVENUES | |||
Total revenues | $ 32,267,593 | $ 26,552,481 | $ 20,272,996 |
COST OF REVENUES | |||
Total cost of revenues | 21,630,216 | 17,170,669 | 12,816,882 |
GROSS PROFIT | 10,637,377 | 9,381,812 | 7,456,114 |
Sewage Treatment Services And Others [Member] | |||
REVENUES | |||
Total revenues | 1,942,326 | 2,296,881 | 3,283,824 |
COST OF REVENUES | |||
Total cost of revenues | 1,194,817 | 1,425,538 | 2,245,608 |
GROSS PROFIT | $ 747,509 | $ 871,343 | $ 1,038,216 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings Statutory Reserves [Member] | Retained Earnings Unrestricted [Member] | AOCI Attributable to Parent [Member] | Noncontrolling Interest [Member] | Total |
Beginning balance, value at Dec. 31, 2020 | $ 23,000 | $ 7,453,265 | $ 1,061,217 | $ 5,399,121 | $ 212,504 | $ 1,236,671 | $ 15,385,778 |
Beginning balance , shares at Dec. 31, 2020 | 9,200,000 | ||||||
Net income attributable to CDT Environmental Technology Investment Holdings Limited | 6,775,739 | 6,775,739 | |||||
Net income attributable to noncontrolling interests | (197,479) | (197,479) | |||||
Statutory reserve | 700,411 | (700,411) | |||||
Foreign currency translation adjustments | 347,249 | 80,947 | 428,196 | ||||
Ending balance, value at Dec. 31, 2021 | $ 23,000 | 7,453,265 | 1,761,628 | 11,474,449 | 559,753 | 1,120,139 | 22,392,234 |
Ending balance , shares at Dec. 31, 2021 | 9,200,000 | ||||||
Net income attributable to CDT Environmental Technology Investment Holdings Limited | 5,782,018 | 5,782,018 | |||||
Net income attributable to noncontrolling interests | (539,229) | (539,229) | |||||
Statutory reserve | 643,911 | (634,911) | |||||
Derecognition of noncontrolling interest upon disposal of a subsidiary | 35,199 | 35,199 | |||||
Foreign currency translation adjustments | (2,050,374) | (59,937) | (2,110,311) | ||||
Ending balance, value at Dec. 31, 2022 | $ 23,000 | 7,453,265 | 2,396,539 | 16,621,556 | (1,490,621) | 556,172 | 25,559,911 |
Ending balance , shares at Dec. 31, 2022 | 9,200,000 | ||||||
Net income attributable to CDT Environmental Technology Investment Holdings Limited | 7,417,706 | 7,417,706 | |||||
Net income attributable to noncontrolling interests | (393,652) | (393,652) | |||||
Statutory reserve | 796,316 | (796,316) | |||||
Foreign currency translation adjustments | (518,800) | 21,078 | (497,722) | ||||
Ending balance, value at Dec. 31, 2023 | $ 23,000 | $ 7,453,265 | $ 3,192,855 | $ 23,242,946 | $ (2,009,421) | $ 183,598 | $ 32,086,243 |
Ending balance , shares at Dec. 31, 2023 | 9,200,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOW - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net income | $ 7,024,054 | $ 5,242,789 | $ 6,578,260 |
Adjustments to reconcile net income to net cash used in operating activities: | |||
Depreciation | 331,336 | 383,827 | 282,838 |
Amortization of intangible assets | 11,355 | 14,434 | 10,369 |
Amortization of right-of-use assets | 95,695 | 85,995 | 0 |
(Recovery from) Provision for credit loss ,net | (88,221) | 471,454 | (1,865,622) |
Loss on disposal of a subsidiary | 0 | 13,162 | 0 |
Loss on disposal of equipment | 119,069 | 0 | 0 |
Deferred tax expense | 46,745 | 33,323 | 303,049 |
Change in operating assets and liabilities | |||
Accounts receivable | (9,240,652) | (7,364,305) | (453,313) |
Other receivables | (247,609) | (119,353) | 50,253 |
Employee advances-related parties | 0 | 0 | 28,378 |
Contract assets | (13,579,514) | (12,154,800) | (10,936,944) |
Contract costs | 889,180 | 740,644 | 8,680 |
Deferred costs | 45,194 | (47,348) | 0 |
Prepayments and other current assets | 1,735,536 | 1,267,770 | (1,189,385) |
Accounts payable | 9,216,778 | 5,627,716 | 5,852,143 |
Other payables and accrued liabilities | (45,075) | 58,676 | 463,911 |
Contract liabilities | (280) | 3,520 | 0 |
Lease liabilities | (91,010) | (75,365) | 0 |
Taxes payable | 644,753 | 1,345,081 | 737,744 |
Net cash used in operating activities | (3,132,666) | (4,472,780) | (129,639) |
CASH FLOWS FROM INVESTING ACTIVITIES: | |||
Purchases of equipment | (21,550) | (53,187) | (101,279) |
Cash received from disposal of equipment | 38,379 | 0 | 0 |
Purchases of intangible assets | 0 | (33,754) | 0 |
Repayments from third parties | 56,764 | 0 | 1,578,067 |
Repayments from related parties | 169,993 | 0 | 356,049 |
Loan to related parties | 0 | (7,511) | 0 |
Net cash provided by (used in) investing activities | 243,586 | (94,452) | 1,832,837 |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Payments of initial public offering (“IPO”) costs | (46,859) | (68,858) | (102,766) |
Proceeds from short-term loans - banks | 2,108,789 | 716,470 | 932,031 |
Repayments of short-term loans - banks | (355,840) | (891,981) | (1,212,121) |
Proceeds from long-term loan - bank | 255,439 | 187,627 | 155,003 |
Repayments of long-term loan - bank | (67,576) | (148,600) | (21,106) |
Proceeds from/ (repayments of) short-term loans - third parties, net | (134,957) | 113,141 | (363,960) |
Proceeds from other payables - related parties, net | 14,191 | (39,767) | (67,740) |
Proceeds from (repayments of) short-term loans - related parties, net | 1,216,973 | 3,864,710 | (247,167) |
Net cash provided by (used in) financing activities | 2,990,160 | 3,732,742 | (927,826) |
EFFECT OF EXCHANGE RATE CHANGES | (32,842) | (100,608) | (4,106) |
NET CHANGE IN CASH AND RESTRICTED CASH | 68,238 | (935,098) | 771,266 |
CASH AND RESTRICTED CASH, BEGINNING OF THE YEAR | 199,864 | 1,134,962 | 363,696 |
CASH AND RESTRICTED CASH, END OF THE YEAR | 268,102 | 199,864 | 1,134,962 |
SUPPLEMENTAL CASH FLOW INFORMATION: | |||
Cash paid for income tax | 7,271 | 2,572 | 22,640 |
Cash paid for interest | 106,130 | 64,658 | 58,709 |
SUPPLEMENTAL NON-CASH INVESTING AND FINANCING INFORMATION: | |||
Initial recognition of operating right of use asset and lease liability | 0 | 407,446 | 0 |
Recognition of other receivable from third party upon disposal of a subsidiary | $ 0 | $ 4,460 | $ 0 |
Nature of business and organiza
Nature of business and organization | 12 Months Ended |
Dec. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of business and organization | Note 1– Nature of business and organization CDT Environmental Technology Investment Holdings Limited (“CDT Cayman” or the “Company”) is a holding company incorporated on November 28, 2016, under the laws of the Cayman Islands. The Company has no substantive operations other than holding all of the outstanding equity of Chao Qiang Holdings Limited (“CQ BVI”) established under the laws of the British Virgin Islands on December 14, 2015 and all of the outstanding equity of CDT Environmental Technology Group Limited (“CDT BVI”) established under the laws of the British Virgin Islands on June 26, 2015. CQ BVI is a holding company holding all of the outstanding equity of Ultra Leader Investments Limited (“Ultra HK”) which was established in Hong Kong on February 27, 2015. Ultra HK is a holding company holding 15% of the outstanding equity of Shenzhen CDT Environmental Technology Co., Ltd. (“Shenzhen CDT”) which was established on August 27, 2012 under the laws of the People’s Republic of China (“PRC” or “China”). CDT BVI is a holding company holding all of the outstanding equity of CDT Environmental Technology (Hong Kong) Limited (“CDT HK”) which was established in Hong Kong on July 30, 2015. CDT HK is also a holding company holding 85% of the outstanding equity of Shenzhen CDT. The Company, through Ultra HK and CDT HK, holds 100% of the outstanding equity of Shenzhen CDT. The Company, through its wholly owned subsidiary, Shenzhen CDT, and its subsidiaries, engages in developing, producing, selling and installing sewage treatment systems and providing sewage treatment services. The Company focuses on the harmless treatment of municipal and rural cesspool, pipe dredging, treatment of inland river sludge and rural sewage treatment, and providing one-stop solutions. The accompanying consolidated financial statements reflect the activities of CDT Cayman and each of the following entities as of December 31, 2023: Schedule of subsidiaries Name Background Ownership Chao Qiang Holdings Limited (“CQ BVI”) ● A British Virgin Islands company ● Incorporated on December 14, 2015 ● A holding company 100% owned by CDT Cayman CDT Environmental Technology Group Limited (“CDT BVI”) ● A British Virgin Islands company ● Incorporated on June 26, 2015 ● A holding company 100% owned by CDT Cayman Ultra Leader Investments Limited (“Ultra HK”) ● A Hong Kong company ● Incorporated on February 27, 2015 ● A holding company 100% owned by CQ BVI CDT Environmental Technology (Hong Kong) Limited (“CDT HK”) ● A Hong Kong company ● Incorporated on July 30, 2015 ● A holding company 100% owned by CDT BVI Shenzhen CDT Environmental Technology Co., Ltd. (“Shenzhen CDT”) ● A PRC limited liability company ● Incorporated on August 27, 2012 ● Registered capital of RMB 60,000,000 ● Developing, producing, selling and installing sewage treatment systems and providing sewage treatment services 100% collectively owned by Ultra HK (15%) and CDT HK (85%) Beijing CDT Environmental Technology Co., Ltd. (“BJ CDT”) ● A PRC limited liability company ● Incorporated on April 25, 2016 ● Registered capital of RMB 20,000,000 ● Providing sewage treatment services 100% owned by Shenzhen CDT Fuzhou LSY Environmental Technology Co., Ltd. (“FJ LSY”) ● A PRC limited liability company ● Incorporated on March 13, 2015 ● Registered capital of RMB 5,000,000 ● Providing sewage treatment services 51% owned by Shenzhen CDT Tianjin CDT Environmental Technology Co., Ltd. (“TJ CDT”) ● A PRC limited liability company ● Incorporated on October 22, 2014 ● Registered capital of RMB 10,000,000 ● Providing sewage treatment services 100% owned by Shenzhen CDT Chengde CDT Environmental Technology Co., Ltd. (“CD CDT”) ● A PRC limited liability company ● Incorporated on March 26, 2015 ● Registered capital of RMB 5,000,000 ● Providing sewage treatment services 51% owned by Shenzhen CDT Beijing Innovation CDT Environmental Technology Co., Ltd. (“BJ CX CDT”) ● A PRC limited liability company ● Incorporated on September 7, 2016 ● Registered capital of RMB 5,000,000 ● Providing sewage treatment services 51% owned by Shenzhen CDT Baoding CDT Environmental Technology Co., Ltd. (“BD CDT”) ● A PRC limited liability company ● Incorporated on October 21, 2015 ● Registered capital of RMB 5,000,000 ● Providing sewage treatment services 51% owned by Shenzhen CDT Hengshui CDT Environmental Technology Co., Ltd. (“HS CDT”) ● A PRC limited liability company ● Incorporated on May 18, 2015 ● Registered capital of RMB 3,000,000 ● Providing sewage treatment services 51% owned by Shenzhen CDT Guangxi CWT Environmental Technology Co., Ltd. (“GX CDT”) (2) ● A PRC limited liability company ● Incorporated on January 29, 2016 ● Registered capital of RMB 5,000,000 ● Providing sewage treatment services 51% owned by Shenzhen CDT Huzhou CDT Environmental Technology Co., Ltd. (“HZ CDT”) ● A PRC limited liability company ● Incorporated on February 6, 2015 ● Registered capital of RMB 5,000,000 ● Providing sewage treatment services 51% owned by Shenzhen CDT Hohhot CDT Environmental Technology Co., Ltd. (“HHHT CDT”) ● A PRC limited liability company ● Incorporated on February 11, 2015 ● Registered capital of RMB 5,000,000 ● Providing sewage treatment services 51% owned by Shenzhen CDT Taiyuan CDT Environmental Technology Co., Ltd. (“TY CDT”) ● A PRC limited liability company ● Incorporated on March 23, 2015 ● Registered capital of RMB 5,000,000 ● Providing sewage treatment services 51% owned by Shenzhen CDT Xiamen YDT Environmental Technology Co., Ltd. (“XM YDT”) (1) ● A PRC limited liability company ● Incorporated on April 9, 2015 ● Registered capital of RMB 5,000,000 ● Providing sewage treatment services 51% owned by Shenzhen CDT (1) In January 2022, the Company disposed of its entire 51% ownership in XM YDT and transferred its ownership to a third party for consideration of approximately $5,000. The disposal of XM YDT did not have a material impact on the Company’s consolidated financial statements. (2) In March 2024, the Company disposed of its entire 51% ownership in GX CDT and transferred its ownership to Chun’E Zhao, the legal representative of GX CDT for consideration of RMB 500. The disposal of GX CDT did not have a material impact on the Company’s consolidated financial statements. |
Liquidity
Liquidity | 12 Months Ended |
Dec. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Liquidity | Note 2 – Liquidity In assessing the Company’s liquidity, the Company monitors and analyzes its cash on-hand and its operating requirements and capital expenditure commitments. The Company’s liquidity needs are to meet its working capital requirements, operating expenses and capital expenditure obligations. The Company engages in installing sewage treatment systems and providing sewage treatment services in both urban and rural areas. The Company’s business is capital intensive. Working capital was approximately $ 24.2 12.9 0.3 29,076,549 34,280,084 On April 22, 2024, the Company completed the initial public offering (“IPO”) of 1,500,000 4.00 4.3 600,000 Although the Company believes that it can realize its current assets in the normal course of business, its ability to repay its current obligations will depend on the future realization of its current assets. Management has considered historical experience, the economic environment, trends in the sewage treatment industry, and the expected collectability of accounts receivable and contract assets as of December 31, 2023. The Company expects to realize these outstanding balances, net of allowance within the normal operating cycle of twelve-months. As of the date of the issuance of these consolidated financial statements, the Company has received approximately $ 5.6 ● Financing from the Company’s officers/shareholders; and ● Other available sources of financing from PRC banks, other financial institutions and related parties, given the Company’s credit history. Based on the above considerations, management believes that the Company has sufficient funds to meet its working capital requirements and debt obligations, for at least the next 12 months from the filing date of these consolidated financial statements. However, there is no assurance that management will be successful in their plans. There are a number of factors that could potentially arise that could undermine the Company’s plans, such as changes in the demand for its services, economic conditions, competitive pricing in the sewage treatment services industry, its operating results may deteriorate and its bank and shareholders may not provide continued financial support. |
Summary of significant accounti
Summary of significant accounting policies | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Summary of significant accounting policies | Note 3 – Summary of significant accounting policies Basis of presentation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for information pursuant to the rules and regulations of the Securities Exchange Commission (“SEC”). Principles of consolidation The consolidated financial statements include the financial statements of the Company and its subsidiaries. All transactions and balances among the Company and its subsidiaries have been eliminated upon consolidation. Subsidiaries are those entities in which the Company, directly or indirectly, controls more than one half of the voting power; or has the power to govern the financial and operating policies, to appoint or remove the majority of the members of the board of directors, or to cast a majority of votes at the meeting of directors. Noncontrolling interest represents the portion of the net assets of a subsidiary attributable to interests that are not owned by the Company. The non-controlling interest is presented in the consolidated balance sheets, separately from equity attributable to the shareholders of the Company. Noncontrolling interest’s operating results are presented on the face of the consolidated statements of income and comprehensive income as an allocation of the total income for the year between noncontrolling shareholders and the shareholders of the Company. 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 disclosures of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the periods presented. Significant accounting estimates reflected in the Company’s consolidated financial statements include the estimated cost or input measure method used to calculate the revenue recognized in the Company’s sewage treatment systems installation business, the useful lives of property and equipment and intangible assets, impairment of long-lived assets, allowance for doubtful accounts and allowance for deferred tax assets and uncertain tax position. Actual results could differ from these estimates. Foreign currency translation and transaction The reporting currency of the Company is the U.S. dollar. The Company in China conducts its businesses in the local currency, Renminbi (RMB), as its functional currency. Assets and liabilities are translated at the unified exchange rate as quoted by the People’s Bank of China at the end of the period. The statements of income accounts are translated at the average translation rates and the equity accounts are translated at historical rates. Translation adjustments resulting from this process are included in accumulated other comprehensive loss. Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in the results of operations as incurred. Translation adjustments included in accumulated other comprehensive loss amounted to $ 2,009,421 1,490,621 7.08 6.96 7.81 7.80 7.05 6.73 6.45 7.83 7.83 7.77 Cash Cash consists of cash on hand and deposits placed with banks or other financial institutions and have original maturities of less than three months. Accounts receivable, net Accounts receivable include trade accounts due from customers. Starting from January 1, 2023, the Company adopted ASU No.2016-13 “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASC Topic 326”). The Company used a modified retrospective approach, and the adoption does not have an impact on our consolidated financial statements. Management also periodically evaluates individual customer’s financial condition, credit history, and the current economic conditions to make adjustments in the allowance when it is considered necessary. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company’s management continues to evaluate the reasonableness of the valuation allowance policy and update it if necessary. Other receivables, net Other receivables primarily include advances to employees, and other deposits. Starting from January 1, 2023, the Company adopted ASC Topic 326 on its other receivables using the modified retrospective approach. The new credit loss guidance replaces the old model for measuring the allowance for credit losses with a model that is based on the expected losses rather than incurred losses. Under the new accounting guidance, the Company measures credit losses on its other receivables using the current expected credit loss model under ASC 326. As of December 31, 2023 and 2022, the Company provided allowance for credit loss of $ 500,857 474,758 34,189 144,415 37,032 Contract assets and contract liabilities Projects with performance obligations recognized over time that have revenue recognized to date in excess of cumulative billings are reported on our consolidated balance sheets as “Contract assets”. Provisions for estimated losses of contract assets on uncompleted contracts are made in the period in which such losses are determined. Contract assets having billing terms with the unconditional right to be billed beyond one year are classified as non-current assets. Contract liabilities on uncompleted contracts represent the amounts of cash collected from clients, billings to clients on contracts in advance of work performed and revenue recognized. The majority of these amounts are expected to be earned within twelve months and are classified as current liabilities. Contract costs Contract costs incurred during the initial phases of the Company’s sales contracts are capitalized when the costs relate directly to the contract, are expected to be recovered, and generate or enhance resources to be used in satisfying the performance obligation and such deferred costs will be recognized upon the recognition of the related revenue. These costs primarily consist of labor and material costs directly related to the contract. The Company performs periodic reviews to assess the recoverability of the contract costs. The carrying amount of the asset is compared to the remaining amount of consideration that the Company expects to receive for the services to which the asset relates, less the costs that relate directly to providing those services that have not yet been recognized. If the carrying amount is not recoverable, an impairment loss is recognized. As of December 31, 2023 and 2022, no Deferred Cost The Company recognizes deferred cost from costs to fulfill a contract with a client if the costs are specifically identifiable, generate or enhance resources used to satisfy future performance obligations, and are expected to be recovered. The Company determined that substantially all costs related to implementation activities are administrative in nature and meet the capitalization criteria under Accounting Standards Codification (“ASC”) 340-40. These capitalized costs principally relate to upfront direct costs to obtain the contract. Prepayments, net Prepayments are cash deposited or advanced to suppliers for future inventory purchases or service providers for future services. These amounts are refundable and bear no interest. Prepayments also consist of prepaid consulting fees remitted to third parties in acquiring contracts with customers. Such consulting fee is refundable if the contract with the customer is not signed within the certain period indicated in the consulting service contract term. As of December 31, 2023, the Company has recorded approximately $ 0.5 For any prepayments determined by management that will not be completed by the receipt of inventories, services, or refunded, the Company will recognize an allowance account to reserve for such balances. Management reviews its advances to suppliers on a regular basis to determine if the valuation allowance is adequate and adjusts the allowance when necessary. Delinquent account balances are written-off against allowance after management has determined that the likelihood of completion or collection is not probable. The Company’s management continues to evaluate the reasonableness of the valuation allowance policy and update it if necessary. As of December 31, 2023 and 2022, allowance for doubtful account for prepayments was $ 173,736 171,286 Property and equipment, net Property and equipment are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. The estimated useful lives are as follows: Schedule of estimated useful lives Useful Life Building 45 Equipment 4 10 Office equipment, fixtures and furniture 3 5 Automobiles 5 10 The cost and related accumulated depreciation of assets sold or otherwise retired are eliminated from the accounts and any gain or loss is included in the consolidated statements of income and comprehensive income (loss). Expenditures for maintenance and repairs are charged to operations as incurred, while additions, renewals and betterments, which are expected to extend the useful life of assets, are capitalized. The Company also re-evaluates the periods of depreciation to determine whether subsequent events and circumstances warrant revised estimates of useful lives. Intangible assets, net The Company’s acquired intangible assets with definite useful lives only consist of patents. The Company amortizes its intangible assets with definite useful lives over their estimated useful lives and reviews these assets for impairment. The Company typically amortizes its patents with definite useful lives on a straight-line basis over the shorter of the contractual terms or the estimated economic lives, which is determined to be approximately eight to nine years. Impairment for long-lived assets Long-lived assets, including property and equipment and intangible assets with finite lives are reviewed for impairment whenever events or changes in circumstances (such as a significant adverse change to market conditions that will impact the future use of the assets) indicate that the carrying value of an asset may not be recoverable. The Company assesses the recoverability of the assets based on the undiscounted future cash flows the assets are expected to generate and recognize an impairment loss when estimated undiscounted future cash flows expected to result from the use of the asset plus net proceeds expected from disposition of the asset, if any, are less than the carrying value of the asset. If an impairment is identified, the Company will reduce the carrying amount of the asset to its estimated fair value based on a discounted cash flows approach or, when available and appropriate, to comparable market values. As of December 31, 2023 and 2022, no Fair value measurement The accounting standard regarding fair value of financial instruments and related fair value measurements defines financial instruments and requires disclosure of the fair value of financial instruments held by the Company. The accounting standards define fair value, establish a three-level valuation hierarchy for disclosures of fair value measurement and enhance disclosure requirements for fair value measures. The three levels are defined as follow: ● 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, quoted prices for identical assets and liabilities in inactive markets and inputs that are observable for the assets or liabilities, either directly or indirectly, for substantially the full term of the financial instruments. ● Level 3 inputs to the valuation methodology are unobservable and significant to the fair value. 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. Prepaid initial public offering (“IPO”) costs The Company complies with the requirements of FASB ASC Topic 340-10-S99-1, “Other Assets and Deferred Costs – SEC Materials” (“ASC 340-10-S99”) and SEC Staff Accounting Bulletin Topic 5A, “Expenses of Offering”. Deferred IPO costs consist of underwriting, legal, accounting and other professional expenses incurred through the balance sheet date that are directly related to the Proposed Public Offering and that will be charged to shareholders’ equity upon the completion of the Proposed Public Offering. Should the Proposed Public Offering prove to be unsuccessful, these deferred costs, as well as additional expenses to be incurred, will be charged to operations. Revenue recognition The Company recognizes revenue under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers (ASC 606). The Company recognizes revenue to depict the transfer of promised goods or services (that is, an asset) to customers in an amount that reflects the consideration to which the Company expects to receive in exchange for those goods or services. An asset is transferred when the customer obtains control of that asset. It also requires the Company to identify contractual performance obligations and determine whether revenue should be recognized at a point in time or over time, based on when control of goods or services transfers to a customer. To achieve that core principle, the Company applies the five steps defined under Topic 606: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company accounts for a contract with a customer when the contract is committed in writing, the rights of the parties, including payment terms, are identified, the contract has commercial substance and consideration to collect is substantially probable. In accordance with FASB ASC 340-40, “Other Assets and Deferred Costs”, which requires the capitalization of all incremental costs from obtaining and fulfilling a contract with a customer if such costs are expected to be recovered with the period of more than one year, the Company capitalizes certain contract acquisition costs consisting primarily of consulting fees and expects such consulting fees as a result of obtaining customer contracts to be recoverable. For contracts with a realization period of less than one year, the guidance provides a practical expedient that permits an entity to immediately expense contract acquisition costs when the asset that would have resulted from capitalizing these costs would have been amortized in one year or less. Revenue recognition policies for each type of revenue steams are as follows: i) Sewage treatment systems a) Rendering of sewage treatment systems installation Performance obligations satisfied over time Sales relating to the installation of sewage treatment systems are generally recognized based on the Company’s efforts or inputs to the satisfaction of its performance obligation over time as work progresses because of the continuous transfer of control to the customer and the Company has the right to bill the customer as costs are incurred. The performance obligation includes the sewage treatment system and equipment that the Company sells as well as the continuous system installation to be performed. Typically, revenue is recognized over time using an input measure (i.e., costs incurred to date relative to total estimated costs at completion) to measure progress. The Company generally uses the cost-to-cost measure of progress method because it best depicts the transfer of control to the customer which occurs as the Company incurs costs on its contracts. Under the cost-to-cost measure of progress method, the extent of progress towards completion is measured based on the ratio of total costs incurred to date to the total estimated costs at completion of the performance obligation. Revenues, including estimated fees or profits, are recorded proportionally as costs are incurred. Any expected losses on construction-type contracts in progress are charged to operations, in total, in the period the losses are identified. Contract costs include all direct material and labor costs and those indirect costs related to contract performance, such as indirect labor and supplies. Contract modifications that extend or revise contract terms generally result in recognizing the impact of the revised terms prospectively over the remaining life of the modified contract (i.e., effectively like a new contract). Part of the Company’s process of identifying whether there is a contract with a customer is to assess whether it is probable that the Company will collect substantially all of the consideration to which it will be entitled in exchange for goods or services that will be transferred to the customer. In assessing it is probable that the Company will collect substantially all of the consideration, the Company considers the following: 1) Customary business practice and its knowledge of the customer The Company procures contracts from city or provincial level state-owned construction companies that are responsible for constructing rural sewage infrastructures for local governments to sell, install and operate decentralized rural sewage treatment systems. Although the Company does not have a long period of sewage treatment system operations, historically, the collections from state-owned companies or local governments of their accounts receivable for sewage treatment services did not result in any significant write-downs. As a result, the Company believes it will collect substantially all of the consideration to which it is entitled to. 2) Payment terms The Company’s contract with the customer has payment terms specified based upon certain conditions completed. The payment terms usually include, but are not limited to, the following billing stages: 1) signing of the sales contract, 2) completion of delivery of system equipment to the job sites, 3) completion of system installations, 4) completion of water test and satisfaction of meeting national standards for sewage discharge, and 5) completion of maintenance periods. As the Company’s customers are required to pay the Company at different billing stages over the contract period, as such, the Company believes the progress payments limit the Company’s exposure to credit risk and the Company would be able to collect substantially all of the consideration gradually at different stages. The timing of the satisfaction of our performance obligations is based upon the cost-to-cost measure of progress method, which is generally different than the timing of unconditional right of payment, and is based upon certain conditions completed as specified in the contract. The payment terms usually include, but are not limited to, the following billing stages: 1) signing of the sales contract, approximately 20% - 30% of the contract price, 2) completion of delivery of system equipment to the job sites, approximately 10% - 20% of the contract price, 3) completion of system installations, approximately 10% - 20% of the contract price, 4) completion of water test and satisfaction of national standards for sewage discharge, approximately 20% - 30% of the contract price, and 5) completion of maintenance periods, approximately 5% - 10% of the contract price. The timing between the satisfaction of our performance obligations and the unconditional right to payment would contribute to contract assets and contract liabilities. Payment for sewage treatments systems is made by the customer pursuant to the billing schedule stipulated in the contract which is generally based on the progress of the construction. Cost based input methods of revenue recognition require the Company to make estimates of costs to complete its projects. In making such estimates, significant judgment is required to evaluate assumptions related to the costs to complete its projects, including materials, labor, contingencies, and other system costs. The estimate of unit material costs are reviewed and updated on a quarterly basis, based on the updated information available in the supply markets. The estimate of material quantities to be used for completion and the installation cost is also reviewed and updated on a quarterly basis, based on the updated information on the progress of project execution. If the estimated total costs on any contract, including any inefficient costs, are greater than the net contract revenues, the Company recognizes the entire estimated loss in the period the loss becomes known. The cumulative effect of revisions to estimates related to net contract revenues or costs to complete contracts are recorded in the period in which the revisions to estimates are identified and the amounts can be reasonably estimated. The effect of the changes on future periods are recognized as if the revised estimates had been used since revenue was initially recognized under the contract. Such revisions could occur in any reporting period, and the effects may be material depending on the size of the contracts or the changes in estimates. The installation revenues of treatment system components are combined and considered as one performance obligation. The promises to transfer the equipment and system components and installation are not separately identifiable, which is evidenced by the fact that the Company provides a significant service of integrating the goods and services into a sewage treatment system for which the customer has contracted. The Company currently does not have any modifications of contracts and the contracts currently do not have any variable consideration. The transaction price is clearly identifiable within the Company’s sales contracts, the performance obligation of the Company’s equipment and system component and installation revenues. Furthermore, the installation revenues and sales of treatment system components normally includes assurance-type warranties that the Company’s performance is free from material defect and consistent with the specifications of the Company’s contract, which do not give rise to a separate performance obligation. To the extent the warranty terms provide the customer with an additional service, such as extended maintenance services, such warranty is accounted for as a separate performance obligation even though it is embedded in the sewage treatment system and installation sales contract, which is generally between one to two years after installation. Revenue generated from maintenance services are clearly identifiable and distinguished from the equipment and system component and installation revenues. The Company has no obligations for returns, refunds or similar obligations for its sewage treatment system installations. As of December 31, 2023, the Company had collections allocated to remaining performance obligations for sewage treatment system installments amounting to $15,809,774 which is expected to be recognized upon the satisfaction of the performance obligations within 12 months from December 31, 2023 using an input measure method. b) Rendering of sewage treatment system maintenance services Performance obligations satisfied over time Revenue from sewage treatment system maintenance service contracts require the Company to render repair or maintenance on any system failure during the contracted maintenance periods, which is generally between one to two years. Revenue generated from sewage treatment system maintenance services is recognized over the coverage period on a straight-line basis. The maintenance contract revenue is embedded in the installation contract but clearly identifiable for such maintenance services, which is generally between one to two years after installation. This clause includes identifiable payment terms within the sales contract, which the Company believes can be distinguished from the installation services should the Company need to separately enter the installation and maintenance service contracts. Maintenance services revenues are immaterial to the Company’s consolidated statements of income and comprehensive income for the years ended December 31, 2023, 2022, and 2021. As of December 31, 2023, the Company had transaction price allocated to remaining performance obligations for rendering sewage treatment services amounting to $ 562,609 483,698 c) Financing revenues Performance obligations satisfied over time Financing revenues on interest income from long term contracts with payment terms over one year are recognized as financing revenues over the payment term based on the effective interest rate method determined using the Company’s incremental borrowing rate. ii) Sewage treatment services a) Rendering of sewage treatment services Performance obligations satisfied over time Revenue from sewage treatment service contracts requires the Company to render treatment services on a one-time basis or based upon a specified treatment period, which is generally one year or less. The Company’s performance obligations are generally satisfied over time because customers receive and consume the benefits of such services and the Company has the right to bill the customer as services are performed. Revenue generated from sewage treatment service is recognized using an input measure method, (i.e., labor costs incurred to date relative to total estimated labor cost at completion) to measure progress. Under the labor cost measure of progress method, the extent of progress towards completion is measured based on the ratio of total labor cost incurred to date to the total estimated labor cost at completion of the performance obligation. Revenue, including estimated fees or profits, are recorded proportionally as labor costs are incurred. The Company considers labor time as the best available indicator of the pattern and timing in which contract obligations are fulfilled. The Company has a long history of sewage treatment services resulting in its ability to reasonably estimate the service hours expected to be incurred and the progress toward completion on each fixed-price contract based on the proportion of service hours incurred to date relative to total estimated service hours at completion. Estimated contract costs are based on the budgeted service hours, which are updated based on the progress toward completion on a monthly basis. Pursuant to the contract terms, the Company has enforceable right to payments for the work performed. Provisions for estimated losses, if any, on uncompleted contracts are recorded in the period in which such losses become probable based on the current contract estimates. Costs of sewage treatment services are expensed in the period in which they are incurred. The Company’s disaggregated revenue streams are summarized and disclosed in Note 17. The Company applies a practical expedient to expense costs as incurred for costs to obtain a contract with a customer when the amortization period is one year or less. The Company has no material incremental costs of obtaining contracts with customers that the Company expects the benefit of those costs to be longer than one year which need to be recognized as assets. Warranty provision The Company generally provides limited warranties for work performed under its contracts. At the time a sale is recognized, the Company records estimated future warranty costs under FASB ASC 460, “Guarantees”. Such estimated costs for warranties are estimated at completion and these warranties are not service warranties separately sold by the Company. Generally, the estimated claim rates of warranties is based on actual warranty experience or the Company’s best estimate. There were no Advertising costs Advertising costs amounted to $ 22,677 61,566 95,808 Research and development (“R&D”) R&D expenses include salaries and other compensation-related expenses paid to the Company’s research and product development personnel while they are working on R&D projects, as well as raw materials used for the R&D projects. R&D expenses amounted to $ 80,948 112,668 136,690 Value added taxes (“VAT”) Revenue represents the invoiced value of products or services, net of VAT. The VAT is based on gross sales price and VAT rates range from 6% up to 17% prior to May 2018, up to 16% starting in May 2018, and up to 13% starting in April 2019, depending on the type of products sold or services provided. Entities that are VAT general taxpayers are allowed to offset qualified input VAT paid to suppliers against their output VAT liabilities. The net VAT balance between input VAT and output VAT is recorded in taxes payable. All of the VAT returns filed by the Company’s subsidiaries in China, have been and remain subject to examination by the tax authorities for five years from the date of filing. Income taxes The Company accounts for income taxes in accordance with ASC 740, “Accounting for income taxes”. The charge for taxation is based on the results for the fiscal year as adjusted for items, which are non-assessable or disallowed. It is calculated using tax rates that have been enacted or substantively enacted by the balance sheet date. Deferred taxes are accounted for using the asset and liability method in respect of temporary differences arising from differences between the carrying amount of assets and liabilities in the consolidated financial statements and the corresponding tax basis used in the computation of assessable tax profit. In principle, deferred tax liabilities are recognized for all taxable temporary differences. Deferred tax assets are recognized to the extent that it is probable that taxable profit will be available against which deductible temporary differences can be utilized. Deferred tax is calculated using tax rates that are expected to apply to the period when the asset is realized or the liability is settled. Deferred tax is charged or credited in the income statement, except when it is related to items credited or charged directly to equity, in which case the deferred tax is also dealt with in equity. Net deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the net deferred tax asset will not be realized. Current income taxes are provided for in accordance with the laws of the relevant taxing authorities. An uncertain tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that has greater than 50% likelihood of being realized on examination. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded. No penalties and interest incurred related to underpayment of income tax are classified as other expense in the period incurred. PRC tax returns filed in 2019 to 2023 are subject to examination by any applicable tax authorities. Comprehensive income Comprehensive income consists of two components, net income and other comprehensive income. Other comprehensive income refers to revenue, expenses, gains and losses that under GAAP are recorded as an element of shareholders’ equity but are excluded from net income. Other comprehensive income consists entirely of foreign currency translation adjustments resulting from the U.S. dollar not being the Company’s functional currency. Earnings per share The Company computes earnings per share (“EPS”) in accordance with FASB ASC 260, “Earnings per Share”. FASB ASC 260 requires companies to present basic and diluted EPS. Basic EPS is measured as net income divided by the weighted average ordinary shares outstanding during the reporting period. Diluted EPS presents the dilutive effect on a per share basis of the potential ordinary shares (e.g., convertible securities, options |
Accounts receivable, net
Accounts receivable, net | 12 Months Ended |
Dec. 31, 2023 | |
Credit Loss [Abstract] | |
Accounts receivable, net | Note 4 – Accounts receivable, net Accounts receivable, net consists of the following: Schedule of accounts receivable, net December 31, December 31, Accounts receivable $ 32,085,912 $ 23,280,417 Allowance for doubtful accounts (3,009,363 ) (3,189,642 ) Total accounts receivable, net $ 29,076,549 $ 20,090,775 Movements of allowance for doubtful accounts are as follows: Schedule of movements of allowance for doubtful accounts December 31, December 31, Beginning balance $ 3,189,642 $ 3,004,435 Addition 246,336 555,133 Recovery * (374,078 ) (86,994 ) Exchange rate effect (52,537 ) (282,932 ) Ending balance $ 3,009,363 $ 3,189,642 * The Company recovered account receivable for the years ended December 31, 2023 and 2022 due to collection of account receivable's balance that were allowanced in prior period. |
Contract assets
Contract assets | 12 Months Ended |
Dec. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Contract assets | Note 5 – Contract assets Sewage treatment system revenues are recognized over time using an input measure method (cost-to-cost measure of progress method) to measure progress. Under this method, the extent of progress towards completion is measured based on the ratio of total costs incurred to date to the total estimated costs at completion of the performance obligation. Revenues to date are recognized by applying this ratio to the total contract price of the sewage treatment system revenues. Projects with performance obligations recognized over time that have revenue recognized to date in excess of cumulative billings are reported on the Company’s consolidated balance sheets as “Contract assets”. Provisions for estimated losses of contract assets on uncompleted contracts are made in the period in which such losses are determined. Contract assets that have billing terms with unconditional rights to be billed beyond one year are classified as non-current assets. Contract assets consist of the following: Schedule of contract assets December 31, December 31, Revenue recognized $ 71,023,301 $ 44,587,741 Less: progress billings (31,857,462 ) (18,497,351 ) Contract assets $ 39,165,839 $ 26,090,390 Contract assets, current $ 34,280,084 $ 16,821,489 Contract assets, non-current $ 4,885,755 $ 9,268,901 |
Property and equipment, net
Property and equipment, net | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property and equipment, net | Note 6 – Property and equipment, net Property and equipment, net consist of the following: Schedule of property and equipment December 31, December 31, Building $ 1,135,160 $ 1,154,409 Equipment 2,103,979 2,298,159 Office equipment, fixtures and furniture 65,765 70,139 Automobiles 851,121 1,248,848 Subtotal 4,156,025 4,771,555 Less: accumulated depreciation (2,460,677 ) (2,574,719 ) Property and equipment, net $ 1,695,348 $ 2,196,836 Depreciation expense for the years ended December 31, 2023, 2022, and 2021 amounted to $ 331,336 383,827 282,838 |
Intangible assets, net
Intangible assets, net | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible assets, net | Note 7 – Intangible assets, net Intangible assets, net consist of the following: Schedule of intangible assets December 31, December 31, Patents $ 116,768 $ 118,749 Less: accumulated amortization (100,371 ) (90,585 ) Intangible assets, net $ 16,397 $ 28,164 Amortization expense for the years ended December 31, 2023, 2022, and 2021 amounted to $ 11,355 14,434 10,369 The estimated amortization is as follows: Schedule of estimated amortization Twelve months ending December 31, Estimated 2024 $ 10,685 2025 5,712 Total $ 16,397 |
Loans to third parties
Loans to third parties | 12 Months Ended |
Dec. 31, 2023 | |
Receivables [Abstract] | |
Loans to third parties | Note 8– Loans to third parties Loans to third parties consist of the following: Schedule of loans to third parties Borrower name Maturities Interest Rate December 31, December 31, Fujian Mingzheng Construction Development Ltd. August 2021 (extended to August 2023, repaid in February 2023) 4.4 % $ — $ 14,358 Jinhuo Chen January 2021 (extended to January 2024, repaid in February 2023) 4.4 % — 43,075 Shenzhen Ledoufu Information Technology Ltd. January 2023 (extended to December 2023) 18.0 % — — Total $ — $ 57,433 |
Other payables and accrued liab
Other payables and accrued liabilities | 12 Months Ended |
Dec. 31, 2023 | |
Payables and Accruals [Abstract] | |
Other payables and accrued liabilities | Note 9 – Other payables and accrued liabilities Other payables and accrued liabilities consist of the following: Schedule of other payables and accrued liabilities December 31, December 31, Payables to non-trade vendors and service providers $ 1,773,105 $ 1,618,111 Salary payable 693,396 808,409 Total other payables and accrued liabilities $ 2,466,501 $ 2,426,520 |
Related party balances and tran
Related party balances and transactions | 12 Months Ended |
Dec. 31, 2023 | |
Related Party Transactions [Abstract] | |
Related party balances and transactions | Note 10 – Related party balances and transactions Related party balances Other receivables - related parties Schedule of other receivables - related parties Name of Related Party Relationship Nature December 31, December 31, Fujian Tantan Technology Co, Ltd (“FJ Tantan”)* FJ Tantan’s legal representative is the secretary of Fujian Hongfa Group Ltd (“Fujian Hongfa”). Fujian Hongfa is the shareholder of FJ LSY. Interest free, due December 14, 2023 (extended to June 16, 2024) $ 111,259 $ 251,271 Fuzhou Jinhui Environmental service Co, Ltd (“FZ Jinhui”)* Fujian Jinshun environmental Co, Ltd (“Jinshun”) is the major shareholder of FZ Jinhui. Weihao Chen is the Major shareholder of Jinshun, and the legal representative of FZ LSY. Interest free, due on August 31, 2023 (extended to August 31, 2024) 4,459 38,405 Total $ 115,718 $ 289,676 * As of the date of the issuance of these consolidated financial statements, these receivables have been repaid by the related parties. Other payables – related parties Schedule of other payables – related parties Name of Related Party Relationship Nature December 31, December 31, Wanqiang Lin Director of Ultra HK Advance payment for operational expenses of the Company pending for reimbursement $ 270,806 $ 271,132 Short-term loans - related parties Schedule of Short-term loans - related parties Name of Related Party Relationship Nature December 31, December 31, Beijing Minhongyun Energy Supply Co. Ltd. Yunwu Li, the Company’s Chief Executive Officer and Chairman of the Board of Directors and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd is the director of this entity Interest-free loan due on demand $ 1,064,566 $ 1,082,617 Shenzhen Li Yaxin Industrial Co., Ltd Yunwu Li, the Company’s Chief Executive Officer and Chairman of the Company’s Board of Directors and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd., is the sole shareholder of this entity Interest-free loan due on demand 96,009 50,254 Yunwu Li Chairman of CDT Environmental Technology Co., Ltd. Interest-free loan due on demand 3,446,578 2,260,144 Jianzhong Zhao Legal Representative, General Manager and Director of Hohhot CDT Environmental Technology Co., Ltd. Interest-free loans, due on December 31, 2020 (extended to December 31, 2024) 299,772 286,749 Jianshan Ma Director and General Manager of Chengde CDT Environmental Technology Co., Ltd. Interest-free loans, due on December 31, 2020 (extended to December 31, 2024) 117,279 86,516 Yan Wang Relative of Ying Wang, Supervisor of Huzhou CDT Environmental Technology Co., Ltd. Interest-free loans, due on December 31, 2020 (extended to December 31, 2024) 160,052 57,161 Zhaozhao Xu General project manager of Shenzhen CDT Environmental Technology Co., Ltd. Interest-free loans, due on December 31, 2024 32,473 — Yaoyu Zhou Spouse of Ying Wang, Supervisor of Huzhou CDT Environmental Technology Co., Ltd. Interest-free loans, due on November 2, 2024 155,308 — Guangxi Jingxingming Eletrical Ltd The legal representative of this entity is also the legal representative of Guangxi CWT Environmental Technology Co., Ltd. Interest-free loans, due on August 22, 2024 14,119 — Xingsheng Pan General manager of Shenzhen CDT Environmental Technology Co., Ltd Interest-free loans, due on demand — 374,369 Yunfang Li Sibling of Yunwu Li, the Company’s Chief Executive Officer and Chairman of the Board of Directors and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd is the director of this entity Interest-free loans, due on demand — 14,358 Guangqing shi General manager of Tianjin CDT Environmental Technology Co., Ltd Interest-free loans, due on demand — 6,277 Zhaozhao Xu General manager of Shenzhen CDT Environmental Technology Co., Ltd Interest-free loans, due on demand — 12,923 Total $ 5,386,156 $ 4,231,368 Interest expense pertaining to the above loans for the years ended December 31, 2023 and 2022 were amounted to $0, respectively. |
Credit facilities
Credit facilities | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Credit facilities | Note 11 – Credit facilities Short-term loans – banks Outstanding balances on short-term bank loans consist of the following: Schedule of short-term bank loans Bank Name Maturities Interest Rate Collateral/ Guarantee December 31, 2023 December 31, 2022 China Construction Bank September 2020 (renewed in December 2021, extended to June 2023, and repaid in June 2023) 5.0 % Guaranteed by Weihao Chen, General Manager of Fuzhou LSY Environmental Technology Co., Ltd. $ — $ 138,127 China Construction Bank December 2023 4.2 % None — 73,658 China Bank of Communication(1) August 2024 4.9 5 % Guaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company, and the line of credit is collateralized by a real estate property owned by Yunwu Li. 423,567 430,750 China Bank of Communication(1) January 2024 (extended to December 2024) 4.6 % Guaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company, and the line of credit is collateralized by a real estate property owned by Yunwu Li. 705,945 — Industrial and Commercial Bank of China February 2023 (repaid in February 2023) 3.8 % None — 100,508 Weizhong Bank August 2023 (repaid in August 2023) 5.9 % Guaranteed by Yunhui Xu, the legal representative of TY CDT — 37,691 Weizhong Bank June 2023 (repaid in June 2023) 5.1 % Guaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd. — 63,177 China resource bank March 2024 (repaid in March 2024) 5.8 % Guaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd. 412,272 — Postal saving bank of China (2) June 2024 5.7 % Guaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd. 564,756 — Bank of China November 2024 3.9 % Guaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd 415,096 China Construction Bank December 2024 4.0 % Guaranteed by Chun’E Zhao, the legal representative of Guangxi CWT Environmental Technology Co., Ltd. 52,240 — Weizhong Bank February 2025 6.1 9.7 % Guaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd. 154,509 — Total $ 2,728,385 $ 843,911 (1) In August 2022, the Company secured a renewable line of credit (“Line of Credit 1”) worth approximately $1.1 million from China Bank of Communication for a two-year period. This line of credit is backed by the guarantee of Yunwu Li, the Chief Executive Officer and Chairman of the Board of Directors of the Company, and it is secured by a real estate property owned by Yunwu Li. As of December 31, 2022, the Company has withdrawn two separate loans with an aggregated total of approximately $0.4 million from Line of Credit 1 to be due in August 2023 with 4.9% to 5.0% interest rate per annum. In August 2023, the Company has repaid approximately $0.4 million to Line of Credit 1. In August 2023, the Company has withdrawn another loan of approximately $0.4 million from line of Credit 1 to be due in August 2024 with 4.5% interest rate per annum. (2) In June 2023, the Company secured a renewable line of credit ("Line of Credit 2") worth approximately $0.6 million from Postal Savings Bank of China for a two-year term. This line of credit is guaranteed by Yunwu Li, the Chief Executive Officer and Chairman of the Board of Directors of the Company. Simultaneously, on the same date, the Company withdrew approximately $0.6 million from Line of Credit 2, which carries an interest rate of 5.7% and is set to mature in June 2024. (3) Represent balance due within the next twelve months from below long-term loans – bank. Long-term loans – bank Outstanding balances on long-term bank loans consist of the following: Schedule of long-term loans- bank Bank Name Maturities Interest Collateral/Guarantee December 31, December 31, Weizhong Bank July 2023 (renewal to February 2025) 6.1 9.7 % Guaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd. $ 79,463 $ 47,861 Short-term loans – third parties Outstanding balances on long-term third-party loans consist of the following: Schedule of short-term loans- third parties Lender Name Maturities Interest Rate Collateral/ Guarantee December 31, December 31, Deyun Zhou February 2023 (repaid in January 2023) 0 % None $ — $ 71,792 Lingyu Ye December 2019 (renewed in December 2020, extended to December 2024) 0 % None 28,237 28,717 Runze Li December 2024 0 % None 43,769 109,267 Shanghai Xinjing Construction Labor Service Center August 2021 (extended to June 2024) 0 % None 211,784 215,375 Xiamen Haosheng Investing Co., Ltd. April 2020 (extended to April 2024) 0 % None 28,238 28,716 Total $ 312,028 $ 453,867 Interest expense pertaining to the above loans for the years ended December 31, 2023, 2022, and 2021 were amounted to $ 106,130 64,658 68,656 |
Taxes
Taxes | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Taxes | Note 12 – Taxes Income tax Cayman Islands Under the current laws of the Cayman Islands, the Company is not subject to tax on income or capital gain. Additionally, upon payments of dividends to the shareholders, no Cayman Islands withholding tax will be imposed. British Virgin Islands CQ BVI and CDT BVI are incorporated in the British Virgin Islands and are not subject to tax on income or capital gains under current British Virgin Islands law. In addition, upon payments of dividends by these entities to their shareholders, no British Virgin Islands withholding tax will be imposed. Hong Kong Ultra HK and BVI HK are incorporated in Hong Kong and are 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 profit tax as there were no assessable profits derived from or earned in Hong Kong since inception. PRC Shenzhen CDT and its subsidiaries are governed by the income tax laws of the PRC and the income tax provision in respect to operations in the PRC is calculated at the applicable tax rates on the taxable income for the periods based on existing legislation, interpretations and practices in respect thereof. Under the Enterprise Income Tax Laws of the PRC (the “EIT Laws”), Chinese enterprises are subject to income tax at a rate of 25% after appropriate tax adjustments. Shenzhen CDT obtained the “high-tech enterprise” tax status in December 2016, which reduced its statutory income tax rate to 15% from December 2016 to November 2019. The Company renewed its “high-tech enterprise” tax status in November 2022 upon expiration of its then current “high-tech enterprise” tax status. The renewal was approved by the PRC tax authority, and the high-tech enterprise tax status will expire in November 2024. Except for Shenzhen CDT, the rest of the PRC subsidiaries benefit from tax rate reduction in accordance with the PRC small business preferential rate policy. Going forward, the future tax rate is determined by the taxable income according to the PRC small business preferential rate policy mentioned above. As a result, PRC subsidiaries except Shenzhen CDT reduced their statutory income tax rate to 5.0% for the year ended December 31, 2023. Income tax savings due to the preferential rates on taxable subsidiaries for the years ended December 31, 2023, 2022 and 2021 were amounted to $100,305, 466,048 and $742,814, respectively. The Company’s basic and diluted earning per shares would have been lower by $0.01, $0.05 and $0.08 per share for the years ended December 31, 2023, 2022 and 2021, respectively, without the preferential tax rate reduction. Income tax expense the years ended December 31, 2023, 2022 and 2021 were amounted to $ 1,403,880 1,152,963 1,207,810 19.2 18.0 15.5 Significant components of the provision for income taxes are as follows: .Schedule of significant components of the provision for income taxes For the year ended December 31, 2023 For the year ended December 31, 2022 For the year ended December 31, 2021 Current $ 1,357,135 $ 1,119,640 $ 904,761 Deferred 46,745 33,323 303,049 Provision for income taxes $ 1,403,880 $ 1,152,963 $ 1,207,810 The following table reconciles China statutory rates to the Company’s effective tax rate: Schedule of effective tax rate For the year ended December 31, 2023 For the year ended December 31, 2022 For the year ended December 31, 2021 China statutory income tax rate 25.0 % 25.0 % 25.0 % Preferential tax rate reduction (8.8 %) (7.6 %) (10.3 %) Change in valuation allowance 0.7 % 0.5 % 0.7 % Permanent difference* 0.1 % 0.1 % 0.1 % Effective tax rate 17.0 % 18.0 % 15.5 % * Permanent difference mainly consisted of the meal and entertainment expenses which is partially non-deductible under PRC income tax law. Deferred tax assets – China and Hong Kong Significant components of deferred tax assets are as follows: Schedule of deferred tax assets December 31, December 31, Allowance for doubtful accounts $ 400,704 $ 444,857 Net operating loss carryforwards 334,805 321,754 Valuation allowance (482,627 ) (462,144 ) Deferred tax assets, net $ 252,882 $ 304,467 As of December 31, 2023 and 2022, the Company had net operating loss carryforwards of $ 2,606,744 2,387,142 769,340 748,817 207,864 198,199 126,941 123,555 Certain of the Company’s allowances for doubtful accounts are for the Company’s PRC subsidiaries which the Company believes it is less likely than not that its PRC operations, other than Shenzhen CDT will be able to fully utilize its deferred tax assets related to the allowance for doubtful account in the PRC. As a result, the Company provided 100% allowance on all deferred tax assets on the allowance for doubtful accounts of $ 147,822 140,390 Uncertain tax positions The Company evaluates each uncertain tax position (including the potential application of interest and penalties) based on the technical merits, and measures the unrecognized benefits associated with the tax positions. As December 31, 2023 and 2022, the Company did no Taxes payable consist of the following: Schedule of taxes payable December 31, December 31, VAT taxes payable $ 775,847 $ 1,463,890 Income taxes payable 4,633,460 3,346,842 Other taxes payable 14,648 52,845 Totals $ 5,423,955 $ 4,863,577 |
Concentration of risk
Concentration of risk | 12 Months Ended |
Dec. 31, 2023 | |
Risks and Uncertainties [Abstract] | |
Concentration of risk | Note 13– Concentration of risk Credit risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash. As of December 31, 2023 and 2022, $ 268,102 140,681 77,000 500,000 18,267 33,407 64,000 500,000 The Company is also exposed to risk from its accounts receivable and other receivables. These assets are subjected to credit evaluations. An allowance has been made for estimated unrecoverable amounts which have been determined by reference to past default experience and the current economic environment. All of the Company’s expense transactions are denominated in RMB and HKD, and all of the Company and its subsidiaries’ assets and liabilities are denominated in RMB and HKD. RMB is not freely convertible into foreign currencies. In the PRC, certain foreign exchange transactions are required by law to be transacted only by authorized financial institutions at exchange rates set by the People’s Bank of China (“PBOC”). Remittances in currencies other than RMB by the Company in China must be processed through the PBOC or other China foreign exchange regulatory bodies which require certain supporting documentation in order to affect the remittance. The Company’s functional currency is the RMB, and its financial statements are presented in U.S. dollars. The RMB depreciated by 1.7% from December 31, 2022 to December 31, 2023 and depreciated by 9.2% from December 31, 2021 to December 31, 2022. To the extent that the Company needs to convert U.S. dollars into RMB for capital expenditures and working capital and other business purposes, appreciation of RMB against the U.S. dollar would have an adverse effect on the RMB amount the Company would receive from the conversion. Conversely, if the Company decides to convert RMB into U.S. dollars for the purpose of making payments for dividends, strategic acquisitions or investments or other business purposes, appreciation of U.S. dollar against the RMB would have a negative effect on the U.S. dollar amount available to the Company. Customer concentration risk For the year ended December 31, 2023, two customers accounted for 23.4 10.2 48.5 15.2 14.6 48.9 20.8 As of December 31, 2023, two customers accounted for 13.0 12.3 18.2 15.1 12.9 11.2 Vendor concentration risk For the year ended December 31, 2023, one vendor accounted for 27.3 19.7 10.0 40.7 23.6 11.7 10.0 As of December 31, 2023, no vendors accounted for more than 10.0 12.6 10.9 |
Shareholders_ equity
Shareholders’ equity | 12 Months Ended |
Dec. 31, 2023 | |
Equity [Abstract] | |
Shareholders’ equity | Note 14 – Shareholders’ equity Ordinary shares CDT Cayman was established under the laws of Cayman Islands on November 28, 2016. The authorized number of ordinary shares was 38,000,000 0.01 On October 15, 2019, the shareholders of the Company resolved to create an additional 50,000,000 0.001 23,000,000 0.001 900,000 0.01 38,000,000 0.01 The Company considered the above transactions as a 25.56-for-1 900,000 0.01 23,000,000 0.001 On December 30, 2020, the shareholders of the Company resolved to divide 50,000,000 0.001 20,000,000 0.0025 23,000,000 0.001 9,200,000 0.0025 Restricted assets The Company’s ability to pay dividends is primarily dependent on the Company receiving distributions of funds from its subsidiaries. Relevant PRC statutory laws and regulations permit payments of dividends by Shenzhen CDT and its subsidiaries (collectively “CDT PRC entities”) only out of its retained earnings, if any, as determined in accordance with PRC accounting standards and regulations. The results of operations reflected in the accompanying consolidated financial statements prepared in accordance with U.S. GAAP differ from those reflected in the statutory financial statements of CDT PRC entities. CDT PRC entities are required to set aside at least 10% of their after-tax profits each year, if any, to fund certain statutory reserve funds until such reserve funds reach 50% of its registered capital. In addition, CDT PRC entities may allocate a portion of its after-tax profits based on PRC accounting standards to enterprise expansion fund and staff bonus and welfare fund at its discretion. CDT PRC entities may allocate a portion of its after-tax profits based on PRC accounting standards to a discretionary surplus fund at its discretion. The statutory reserve funds and the discretionary funds are not distributable as cash dividends. Remittance of dividends by a wholly foreign-owned company out of China is subject to examination by the banks designated by State Administration of Foreign Exchange. As a result of the foregoing restrictions, CDT PRC entities are restricted in their ability to transfer their assets to the Company. Foreign exchange and other regulation in the PRC may further restrict CDT PRC entities from transferring funds to the Company in the form of dividends, loans and advances. As of December 31, 2023 and 2022, amounts restricted are the paid-in-capital and statutory reserve of CDT PRC entities, which amounted to $ 7,888,981 7,092,665 Statutory reserves For the years ended December 31, 2023, 2022, and 2021, CDT PRC entities collectively attributed $ 796,316 634,911 700,411 |
Leases
Leases | 12 Months Ended |
Dec. 31, 2023 | |
Leases | |
Leases | Note 15 – Leases As of December 31, 2023, the Company leases two warehouse and two office in varies location within PRC, under non-cancelable operating leases, which lease terms are expired from December 2024 to January 2028. The Company determines if a contract contains a lease at inception. U.S. 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’s office and warehouse leases were classified as operating leases. The leases generally do not contain options to extend at the time of expiration. Lease expense for lease payment is recognized on a straight-line basis over the lease terms. The Company has elected the short-term lease exception; therefore operating leases’ ROU asset and liability do not include leases with a lease term of twelve months or less. For operating leases that include rent escalation clauses, the Company recognized lease expense on a straight-line basis over the lease term from the date it takes possession of the leased property. The Company records the straight-line lease expense and any contingent rent, if applicable, in general and administrative expenses on the consolidated statements of income and comprehensive income. During the year ended December 31, 2023 and 2022, the Company recognized nil 0 407,446 5.5 2.8 4.7 Schedule of lease liabilities remaining operating leases Twelve months ending December 31, Operating lease payment 2024 $ 127,669 2025 40,891 2026 34,950 2027 35,998 2028 and thereafter 3,029 Total undiscounted lease payments 242,537 Less imputed interest (17,724 ) Total lease liabilities $ 224,813 Lease liabilities, current $ 118,833 Lease liabilities, non-current $ 105,980 The following table presents operating lease cost reported in the consolidated statements of income and comprehensive income: Schedule of operating lease cost For the year ended December 31, 2023 For the year ended December 31, 2022 For the year ended December 31, 2021 Operating lease cost $ 109,184 $ 98,690 $ 267,900 Short-term lease cost 105,517 193,525 — Total $ 214,701 $ 292,215 $ 267,900 |
Commitments and contingencies
Commitments and contingencies | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and contingencies | Note 16 – Commitments and contingencies Legal contingencies From time to time, the Company is party to certain legal proceedings, as well as certain asserted and un-asserted claims. Amounts accrued, as well as the total amount of reasonably possible losses with respect to such matters, individually and in the aggregate, are not deemed to be material to the consolidated financial statements. Management fee commitment The total future minimum property management expenses from operating lease commitments with respect to the office as of December 31, 2023 are payable as follows: Schedule of future minimum property management expenses Twelve months ending December 31, Management fee commitment 2024 $ 4,134 |
Enterprise wide disclosure
Enterprise wide disclosure | 12 Months Ended |
Dec. 31, 2023 | |
Segment Reporting [Abstract] | |
Enterprise wide disclosure | Note 17 – Enterprise wide disclosure The Company follows FASB ASC 280, Segment Reporting, which requires companies to disclose segment data based on how management makes decision about allocating resources to each segment and evaluating their performances. The Company’s chief operating decision-makers (i.e., the Company’s chief executive officer and his direct reports, including the Company’s chief financial officer) review financial information presented on a consolidated basis, accompanied by disaggregated information about revenues, cost of revenues, and gross profit by business lines (sewage treatment systems and sewage treatment services) for purposes of allocating resources and evaluating financial performance. There are no segment managers who are held accountable for operations, operating results and plans for levels or components below the consolidated unit level. In addition, all of the Company’s long-lived assets are located in the PRC and all of the Company’s revenues are derived solely from the PRC, accordingly, no geographical information is presented. Based on qualitative and quantitative criteria established by FASB ASC 280, the Company considers itself to be operating within one reportable segment. Disaggregated information of revenues, cost of revenues and gross profit by business lines are as follows: Schedule of disaggregated information For the year ended December 31, 2023 For the year ended December 31, 2022 For the year ended December 31, 2021 Sewage treatment systems $ 32,267,593 $ 26,552,481 $ 20,272,996 Sewage treatment services and others 1,942,326 2,296,881 3,283,824 Total revenues $ 34,209,919 $ 28,849,362 $ 23,556,820 For the year ended December 31, 2023 For the year ended December 31, 2022 For the year ended December 31, 2021 Sewage treatment systems $ 21,630,216 $ 17,170,669 $ 12,816,882 Sewage treatment services and others 1,194,817 1,425,538 2,245,608 Total cost of revenues $ 22,825,033 $ 18,596,207 $ 15,062,490 For the year ended December 31, 2023 For the year ended December 31, 2022 For the year ended December 31, 2021 Sewage treatment systems $ 10,637,377 $ 9,381,812 $ 7,456,114 Sewage treatment services and others 747,509 871,343 1,038,216 Total gross profit $ 11,384,886 $ 10,253,155 $ 8,494,330 |
Subsequent events
Subsequent events | 12 Months Ended |
Dec. 31, 2023 | |
Subsequent Events [Abstract] | |
Subsequent events | Note 18 – Subsequent events In preparing these consolidated financial statements, the Company has evaluated events and transactions for potential recognition or disclosure through the date of this audit report. No other events require adjustment to or disclosure in the consolidated financial statements other than the following: On January 10, 2024, the Company withdrew an approximately $ 0.7 4.4 On April 22, 2024, the Company completed the initial public offering (“IPO”) of 1,500,000 4.00 4.3 600,000 |
Condensed financial information
Condensed financial information of the parent company | 12 Months Ended |
Dec. 31, 2023 | |
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 consolidated subsidiary 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 subsidiary did not pay any dividends to the Company for the periods presented. For the purpose of presenting parent only financial information, the Company records its investment in its subsidiaries 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 income (loss) of the subsidiaries is presented as “Equity income (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 does not have significant capital and other commitments, long-term obligations, or guarantees as of December 31, 2023 and 2022. PARENT COMPANY BALANCE SHEETS Schedule of balance sheets December 31, 2023 December 31, 2022 ASSETS OTHER ASSET Investment in subsidiaries $ 31,902,645 $ 25,003,739 Total asset $ 31,902,645 $ 25,003,739 LIABILITIES AND SHAREHOLDERS’ EQUITY LIABILITIES $ — $ — COMMITMENTS AND CONTINGENCIES — — SHAREHOLDERS’ EQUITY Ordinary shares, $0.0025 par value, 20,000,000 shares authorized, and 9,200,000 shares outstanding as of December 31, 2023 and 2022 23,000 23,000 Additional paid-in capital 7,453,265 7,453,265 Statutory reserves 3,192,855 2,396,539 Retained earnings 23,242,946 16,621,556 Accumulated other comprehensive loss (2,009,421 ) (1,490,621 ) Total shareholders’ equity 31,902,645 25,003,739 Total liabilities and shareholders’ equity $ 31,902,645 $ 25,003,739 PARENT COMPANY STATEMENTS OF INCOME AND COMPREHENSIVE INCOME Schedule of income and comprehensive income For the years ended December 31, 2023 2022 2021 EQUITY INCOME OF SUBSIDIARIES $ 7,417,705 $ 5,782,018 $ 6,775,739 NET INCOME 7,417,705 5,782,018 6,775,739 FOREIGN CURRENCY TRANSLATION ADJUSTMENT (518,799 ) (2,050,374 ) 347,249 COMPREHENSIVE INCOME $ 6,898,906 $ 3,731,644 $ 7,122,988 PARENT COMPANY STATEMENTS OF CASH FLOWS Schedule of cash flows For the years ended December 31, 2023 2022 2021 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 7,417,705 $ 5,782,018 $ 6,775,739 Adjustments to reconcile net income to cash used in operating activities: Equity income of subsidiaries (7,417,705 ) (5,782,018 ) (6,775,739 ) Net cash used in operating activities — — — CHANGES IN CASH — — — CASH, beginning of year — — — CASH, end of year $ — $ — $ — |
Summary of significant accoun_2
Summary of significant accounting policies (Policies) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
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 (“U.S. GAAP”) for information pursuant to the rules and regulations of the Securities Exchange Commission (“SEC”). |
Principles of consolidation | Principles of consolidation The consolidated financial statements include the financial statements of the Company and its subsidiaries. All transactions and balances among the Company and its subsidiaries have been eliminated upon consolidation. Subsidiaries are those entities in which the Company, directly or indirectly, controls more than one half of the voting power; or has the power to govern the financial and operating policies, to appoint or remove the majority of the members of the board of directors, or to cast a majority of votes at the meeting of directors. Noncontrolling interest represents the portion of the net assets of a subsidiary attributable to interests that are not owned by the Company. The non-controlling interest is presented in the consolidated balance sheets, separately from equity attributable to the shareholders of the Company. Noncontrolling interest’s operating results are presented on the face of the consolidated statements of income and comprehensive income as an allocation of the total income for the year between noncontrolling shareholders and the shareholders of the Company. |
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 disclosures of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the periods presented. Significant accounting estimates reflected in the Company’s consolidated financial statements include the estimated cost or input measure method used to calculate the revenue recognized in the Company’s sewage treatment systems installation business, the useful lives of property and equipment and intangible assets, impairment of long-lived assets, allowance for doubtful accounts and allowance for deferred tax assets and uncertain tax position. Actual results could differ from these estimates. |
Foreign currency translation and transaction | Foreign currency translation and transaction The reporting currency of the Company is the U.S. dollar. The Company in China conducts its businesses in the local currency, Renminbi (RMB), as its functional currency. Assets and liabilities are translated at the unified exchange rate as quoted by the People’s Bank of China at the end of the period. The statements of income accounts are translated at the average translation rates and the equity accounts are translated at historical rates. Translation adjustments resulting from this process are included in accumulated other comprehensive loss. Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in the results of operations as incurred. Translation adjustments included in accumulated other comprehensive loss amounted to $ 2,009,421 1,490,621 7.08 6.96 7.81 7.80 7.05 6.73 6.45 7.83 7.83 7.77 |
Cash | Cash Cash consists of cash on hand and deposits placed with banks or other financial institutions and have original maturities of less than three months. |
Accounts receivable, net | Accounts receivable, net Accounts receivable include trade accounts due from customers. Starting from January 1, 2023, the Company adopted ASU No.2016-13 “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASC Topic 326”). The Company used a modified retrospective approach, and the adoption does not have an impact on our consolidated financial statements. Management also periodically evaluates individual customer’s financial condition, credit history, and the current economic conditions to make adjustments in the allowance when it is considered necessary. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company’s management continues to evaluate the reasonableness of the valuation allowance policy and update it if necessary. |
Other receivables, net | Other receivables, net Other receivables primarily include advances to employees, and other deposits. Starting from January 1, 2023, the Company adopted ASC Topic 326 on its other receivables using the modified retrospective approach. The new credit loss guidance replaces the old model for measuring the allowance for credit losses with a model that is based on the expected losses rather than incurred losses. Under the new accounting guidance, the Company measures credit losses on its other receivables using the current expected credit loss model under ASC 326. As of December 31, 2023 and 2022, the Company provided allowance for credit loss of $ 500,857 474,758 34,189 144,415 37,032 |
Contract assets and contract liabilities | Contract assets and contract liabilities Projects with performance obligations recognized over time that have revenue recognized to date in excess of cumulative billings are reported on our consolidated balance sheets as “Contract assets”. Provisions for estimated losses of contract assets on uncompleted contracts are made in the period in which such losses are determined. Contract assets having billing terms with the unconditional right to be billed beyond one year are classified as non-current assets. Contract liabilities on uncompleted contracts represent the amounts of cash collected from clients, billings to clients on contracts in advance of work performed and revenue recognized. The majority of these amounts are expected to be earned within twelve months and are classified as current liabilities. |
Contract costs | Contract costs Contract costs incurred during the initial phases of the Company’s sales contracts are capitalized when the costs relate directly to the contract, are expected to be recovered, and generate or enhance resources to be used in satisfying the performance obligation and such deferred costs will be recognized upon the recognition of the related revenue. These costs primarily consist of labor and material costs directly related to the contract. The Company performs periodic reviews to assess the recoverability of the contract costs. The carrying amount of the asset is compared to the remaining amount of consideration that the Company expects to receive for the services to which the asset relates, less the costs that relate directly to providing those services that have not yet been recognized. If the carrying amount is not recoverable, an impairment loss is recognized. As of December 31, 2023 and 2022, no |
Deferred Cost | Deferred Cost The Company recognizes deferred cost from costs to fulfill a contract with a client if the costs are specifically identifiable, generate or enhance resources used to satisfy future performance obligations, and are expected to be recovered. The Company determined that substantially all costs related to implementation activities are administrative in nature and meet the capitalization criteria under Accounting Standards Codification (“ASC”) 340-40. These capitalized costs principally relate to upfront direct costs to obtain the contract. |
Prepayments, net | Prepayments, net Prepayments are cash deposited or advanced to suppliers for future inventory purchases or service providers for future services. These amounts are refundable and bear no interest. Prepayments also consist of prepaid consulting fees remitted to third parties in acquiring contracts with customers. Such consulting fee is refundable if the contract with the customer is not signed within the certain period indicated in the consulting service contract term. As of December 31, 2023, the Company has recorded approximately $ 0.5 For any prepayments determined by management that will not be completed by the receipt of inventories, services, or refunded, the Company will recognize an allowance account to reserve for such balances. Management reviews its advances to suppliers on a regular basis to determine if the valuation allowance is adequate and adjusts the allowance when necessary. Delinquent account balances are written-off against allowance after management has determined that the likelihood of completion or collection is not probable. The Company’s management continues to evaluate the reasonableness of the valuation allowance policy and update it if necessary. As of December 31, 2023 and 2022, allowance for doubtful account for prepayments was $ 173,736 171,286 |
Property and equipment, net | Property and equipment, net Property and equipment are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. The estimated useful lives are as follows: Schedule of estimated useful lives Useful Life Building 45 Equipment 4 10 Office equipment, fixtures and furniture 3 5 Automobiles 5 10 The cost and related accumulated depreciation of assets sold or otherwise retired are eliminated from the accounts and any gain or loss is included in the consolidated statements of income and comprehensive income (loss). Expenditures for maintenance and repairs are charged to operations as incurred, while additions, renewals and betterments, which are expected to extend the useful life of assets, are capitalized. The Company also re-evaluates the periods of depreciation to determine whether subsequent events and circumstances warrant revised estimates of useful lives. |
Intangible assets, net | Intangible assets, net The Company’s acquired intangible assets with definite useful lives only consist of patents. The Company amortizes its intangible assets with definite useful lives over their estimated useful lives and reviews these assets for impairment. The Company typically amortizes its patents with definite useful lives on a straight-line basis over the shorter of the contractual terms or the estimated economic lives, which is determined to be approximately eight to nine years. |
Impairment for long-lived assets | Impairment for long-lived assets Long-lived assets, including property and equipment and intangible assets with finite lives are reviewed for impairment whenever events or changes in circumstances (such as a significant adverse change to market conditions that will impact the future use of the assets) indicate that the carrying value of an asset may not be recoverable. The Company assesses the recoverability of the assets based on the undiscounted future cash flows the assets are expected to generate and recognize an impairment loss when estimated undiscounted future cash flows expected to result from the use of the asset plus net proceeds expected from disposition of the asset, if any, are less than the carrying value of the asset. If an impairment is identified, the Company will reduce the carrying amount of the asset to its estimated fair value based on a discounted cash flows approach or, when available and appropriate, to comparable market values. As of December 31, 2023 and 2022, no |
Fair value measurement | Fair value measurement The accounting standard regarding fair value of financial instruments and related fair value measurements defines financial instruments and requires disclosure of the fair value of financial instruments held by the Company. The accounting standards define fair value, establish a three-level valuation hierarchy for disclosures of fair value measurement and enhance disclosure requirements for fair value measures. The three levels are defined as follow: ● 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, quoted prices for identical assets and liabilities in inactive markets and inputs that are observable for the assets or liabilities, either directly or indirectly, for substantially the full term of the financial instruments. ● Level 3 inputs to the valuation methodology are unobservable and significant to the fair value. 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. |
Prepaid initial public offering (“IPO”) costs | Prepaid initial public offering (“IPO”) costs The Company complies with the requirements of FASB ASC Topic 340-10-S99-1, “Other Assets and Deferred Costs – SEC Materials” (“ASC 340-10-S99”) and SEC Staff Accounting Bulletin Topic 5A, “Expenses of Offering”. Deferred IPO costs consist of underwriting, legal, accounting and other professional expenses incurred through the balance sheet date that are directly related to the Proposed Public Offering and that will be charged to shareholders’ equity upon the completion of the Proposed Public Offering. Should the Proposed Public Offering prove to be unsuccessful, these deferred costs, as well as additional expenses to be incurred, will be charged to operations. |
Revenue recognition | Revenue recognition The Company recognizes revenue under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers (ASC 606). The Company recognizes revenue to depict the transfer of promised goods or services (that is, an asset) to customers in an amount that reflects the consideration to which the Company expects to receive in exchange for those goods or services. An asset is transferred when the customer obtains control of that asset. It also requires the Company to identify contractual performance obligations and determine whether revenue should be recognized at a point in time or over time, based on when control of goods or services transfers to a customer. To achieve that core principle, the Company applies the five steps defined under Topic 606: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company accounts for a contract with a customer when the contract is committed in writing, the rights of the parties, including payment terms, are identified, the contract has commercial substance and consideration to collect is substantially probable. In accordance with FASB ASC 340-40, “Other Assets and Deferred Costs”, which requires the capitalization of all incremental costs from obtaining and fulfilling a contract with a customer if such costs are expected to be recovered with the period of more than one year, the Company capitalizes certain contract acquisition costs consisting primarily of consulting fees and expects such consulting fees as a result of obtaining customer contracts to be recoverable. For contracts with a realization period of less than one year, the guidance provides a practical expedient that permits an entity to immediately expense contract acquisition costs when the asset that would have resulted from capitalizing these costs would have been amortized in one year or less. Revenue recognition policies for each type of revenue steams are as follows: i) Sewage treatment systems a) Rendering of sewage treatment systems installation Performance obligations satisfied over time Sales relating to the installation of sewage treatment systems are generally recognized based on the Company’s efforts or inputs to the satisfaction of its performance obligation over time as work progresses because of the continuous transfer of control to the customer and the Company has the right to bill the customer as costs are incurred. The performance obligation includes the sewage treatment system and equipment that the Company sells as well as the continuous system installation to be performed. Typically, revenue is recognized over time using an input measure (i.e., costs incurred to date relative to total estimated costs at completion) to measure progress. The Company generally uses the cost-to-cost measure of progress method because it best depicts the transfer of control to the customer which occurs as the Company incurs costs on its contracts. Under the cost-to-cost measure of progress method, the extent of progress towards completion is measured based on the ratio of total costs incurred to date to the total estimated costs at completion of the performance obligation. Revenues, including estimated fees or profits, are recorded proportionally as costs are incurred. Any expected losses on construction-type contracts in progress are charged to operations, in total, in the period the losses are identified. Contract costs include all direct material and labor costs and those indirect costs related to contract performance, such as indirect labor and supplies. Contract modifications that extend or revise contract terms generally result in recognizing the impact of the revised terms prospectively over the remaining life of the modified contract (i.e., effectively like a new contract). Part of the Company’s process of identifying whether there is a contract with a customer is to assess whether it is probable that the Company will collect substantially all of the consideration to which it will be entitled in exchange for goods or services that will be transferred to the customer. In assessing it is probable that the Company will collect substantially all of the consideration, the Company considers the following: 1) Customary business practice and its knowledge of the customer The Company procures contracts from city or provincial level state-owned construction companies that are responsible for constructing rural sewage infrastructures for local governments to sell, install and operate decentralized rural sewage treatment systems. Although the Company does not have a long period of sewage treatment system operations, historically, the collections from state-owned companies or local governments of their accounts receivable for sewage treatment services did not result in any significant write-downs. As a result, the Company believes it will collect substantially all of the consideration to which it is entitled to. 2) Payment terms The Company’s contract with the customer has payment terms specified based upon certain conditions completed. The payment terms usually include, but are not limited to, the following billing stages: 1) signing of the sales contract, 2) completion of delivery of system equipment to the job sites, 3) completion of system installations, 4) completion of water test and satisfaction of meeting national standards for sewage discharge, and 5) completion of maintenance periods. As the Company’s customers are required to pay the Company at different billing stages over the contract period, as such, the Company believes the progress payments limit the Company’s exposure to credit risk and the Company would be able to collect substantially all of the consideration gradually at different stages. The timing of the satisfaction of our performance obligations is based upon the cost-to-cost measure of progress method, which is generally different than the timing of unconditional right of payment, and is based upon certain conditions completed as specified in the contract. The payment terms usually include, but are not limited to, the following billing stages: 1) signing of the sales contract, approximately 20% - 30% of the contract price, 2) completion of delivery of system equipment to the job sites, approximately 10% - 20% of the contract price, 3) completion of system installations, approximately 10% - 20% of the contract price, 4) completion of water test and satisfaction of national standards for sewage discharge, approximately 20% - 30% of the contract price, and 5) completion of maintenance periods, approximately 5% - 10% of the contract price. The timing between the satisfaction of our performance obligations and the unconditional right to payment would contribute to contract assets and contract liabilities. Payment for sewage treatments systems is made by the customer pursuant to the billing schedule stipulated in the contract which is generally based on the progress of the construction. Cost based input methods of revenue recognition require the Company to make estimates of costs to complete its projects. In making such estimates, significant judgment is required to evaluate assumptions related to the costs to complete its projects, including materials, labor, contingencies, and other system costs. The estimate of unit material costs are reviewed and updated on a quarterly basis, based on the updated information available in the supply markets. The estimate of material quantities to be used for completion and the installation cost is also reviewed and updated on a quarterly basis, based on the updated information on the progress of project execution. If the estimated total costs on any contract, including any inefficient costs, are greater than the net contract revenues, the Company recognizes the entire estimated loss in the period the loss becomes known. The cumulative effect of revisions to estimates related to net contract revenues or costs to complete contracts are recorded in the period in which the revisions to estimates are identified and the amounts can be reasonably estimated. The effect of the changes on future periods are recognized as if the revised estimates had been used since revenue was initially recognized under the contract. Such revisions could occur in any reporting period, and the effects may be material depending on the size of the contracts or the changes in estimates. The installation revenues of treatment system components are combined and considered as one performance obligation. The promises to transfer the equipment and system components and installation are not separately identifiable, which is evidenced by the fact that the Company provides a significant service of integrating the goods and services into a sewage treatment system for which the customer has contracted. The Company currently does not have any modifications of contracts and the contracts currently do not have any variable consideration. The transaction price is clearly identifiable within the Company’s sales contracts, the performance obligation of the Company’s equipment and system component and installation revenues. Furthermore, the installation revenues and sales of treatment system components normally includes assurance-type warranties that the Company’s performance is free from material defect and consistent with the specifications of the Company’s contract, which do not give rise to a separate performance obligation. To the extent the warranty terms provide the customer with an additional service, such as extended maintenance services, such warranty is accounted for as a separate performance obligation even though it is embedded in the sewage treatment system and installation sales contract, which is generally between one to two years after installation. Revenue generated from maintenance services are clearly identifiable and distinguished from the equipment and system component and installation revenues. The Company has no obligations for returns, refunds or similar obligations for its sewage treatment system installations. As of December 31, 2023, the Company had collections allocated to remaining performance obligations for sewage treatment system installments amounting to $15,809,774 which is expected to be recognized upon the satisfaction of the performance obligations within 12 months from December 31, 2023 using an input measure method. b) Rendering of sewage treatment system maintenance services Performance obligations satisfied over time Revenue from sewage treatment system maintenance service contracts require the Company to render repair or maintenance on any system failure during the contracted maintenance periods, which is generally between one to two years. Revenue generated from sewage treatment system maintenance services is recognized over the coverage period on a straight-line basis. The maintenance contract revenue is embedded in the installation contract but clearly identifiable for such maintenance services, which is generally between one to two years after installation. This clause includes identifiable payment terms within the sales contract, which the Company believes can be distinguished from the installation services should the Company need to separately enter the installation and maintenance service contracts. Maintenance services revenues are immaterial to the Company’s consolidated statements of income and comprehensive income for the years ended December 31, 2023, 2022, and 2021. As of December 31, 2023, the Company had transaction price allocated to remaining performance obligations for rendering sewage treatment services amounting to $ 562,609 483,698 c) Financing revenues Performance obligations satisfied over time Financing revenues on interest income from long term contracts with payment terms over one year are recognized as financing revenues over the payment term based on the effective interest rate method determined using the Company’s incremental borrowing rate. ii) Sewage treatment services a) Rendering of sewage treatment services Performance obligations satisfied over time Revenue from sewage treatment service contracts requires the Company to render treatment services on a one-time basis or based upon a specified treatment period, which is generally one year or less. The Company’s performance obligations are generally satisfied over time because customers receive and consume the benefits of such services and the Company has the right to bill the customer as services are performed. Revenue generated from sewage treatment service is recognized using an input measure method, (i.e., labor costs incurred to date relative to total estimated labor cost at completion) to measure progress. Under the labor cost measure of progress method, the extent of progress towards completion is measured based on the ratio of total labor cost incurred to date to the total estimated labor cost at completion of the performance obligation. Revenue, including estimated fees or profits, are recorded proportionally as labor costs are incurred. The Company considers labor time as the best available indicator of the pattern and timing in which contract obligations are fulfilled. The Company has a long history of sewage treatment services resulting in its ability to reasonably estimate the service hours expected to be incurred and the progress toward completion on each fixed-price contract based on the proportion of service hours incurred to date relative to total estimated service hours at completion. Estimated contract costs are based on the budgeted service hours, which are updated based on the progress toward completion on a monthly basis. Pursuant to the contract terms, the Company has enforceable right to payments for the work performed. Provisions for estimated losses, if any, on uncompleted contracts are recorded in the period in which such losses become probable based on the current contract estimates. Costs of sewage treatment services are expensed in the period in which they are incurred. The Company’s disaggregated revenue streams are summarized and disclosed in Note 17. The Company applies a practical expedient to expense costs as incurred for costs to obtain a contract with a customer when the amortization period is one year or less. The Company has no material incremental costs of obtaining contracts with customers that the Company expects the benefit of those costs to be longer than one year which need to be recognized as assets. |
Warranty provision | Warranty provision The Company generally provides limited warranties for work performed under its contracts. At the time a sale is recognized, the Company records estimated future warranty costs under FASB ASC 460, “Guarantees”. Such estimated costs for warranties are estimated at completion and these warranties are not service warranties separately sold by the Company. Generally, the estimated claim rates of warranties is based on actual warranty experience or the Company’s best estimate. There were no |
Advertising costs | Advertising costs Advertising costs amounted to $ 22,677 61,566 95,808 |
Research and development (“R&D”) | Research and development (“R&D”) R&D expenses include salaries and other compensation-related expenses paid to the Company’s research and product development personnel while they are working on R&D projects, as well as raw materials used for the R&D projects. R&D expenses amounted to $ 80,948 112,668 136,690 |
Value added taxes (“VAT”) | Value added taxes (“VAT”) Revenue represents the invoiced value of products or services, net of VAT. The VAT is based on gross sales price and VAT rates range from 6% up to 17% prior to May 2018, up to 16% starting in May 2018, and up to 13% starting in April 2019, depending on the type of products sold or services provided. Entities that are VAT general taxpayers are allowed to offset qualified input VAT paid to suppliers against their output VAT liabilities. The net VAT balance between input VAT and output VAT is recorded in taxes payable. All of the VAT returns filed by the Company’s subsidiaries in China, have been and remain subject to examination by the tax authorities for five years from the date of filing. |
Income taxes | Income taxes The Company accounts for income taxes in accordance with ASC 740, “Accounting for income taxes”. The charge for taxation is based on the results for the fiscal year as adjusted for items, which are non-assessable or disallowed. It is calculated using tax rates that have been enacted or substantively enacted by the balance sheet date. Deferred taxes are accounted for using the asset and liability method in respect of temporary differences arising from differences between the carrying amount of assets and liabilities in the consolidated financial statements and the corresponding tax basis used in the computation of assessable tax profit. In principle, deferred tax liabilities are recognized for all taxable temporary differences. Deferred tax assets are recognized to the extent that it is probable that taxable profit will be available against which deductible temporary differences can be utilized. Deferred tax is calculated using tax rates that are expected to apply to the period when the asset is realized or the liability is settled. Deferred tax is charged or credited in the income statement, except when it is related to items credited or charged directly to equity, in which case the deferred tax is also dealt with in equity. Net deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the net deferred tax asset will not be realized. Current income taxes are provided for in accordance with the laws of the relevant taxing authorities. An uncertain tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that has greater than 50% likelihood of being realized on examination. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded. No penalties and interest incurred related to underpayment of income tax are classified as other expense in the period incurred. PRC tax returns filed in 2019 to 2023 are subject to examination by any applicable tax authorities. |
Comprehensive income | Comprehensive income Comprehensive income consists of two components, net income and other comprehensive income. Other comprehensive income refers to revenue, expenses, gains and losses that under GAAP are recorded as an element of shareholders’ equity but are excluded from net income. Other comprehensive income consists entirely of foreign currency translation adjustments resulting from the U.S. dollar not being the Company’s functional currency. |
Earnings per share | Earnings per share The Company computes earnings per share (“EPS”) in accordance with FASB ASC 260, “Earnings per Share”. FASB ASC 260 requires companies to present basic and diluted EPS. Basic EPS is measured as net income divided by the weighted average ordinary shares outstanding during the reporting period. Diluted EPS presents the dilutive effect on a per share basis of the potential ordinary shares (e.g., convertible securities, options and warrants) as if they had been converted at the beginning of the periods presented, or issuance date, if later. Potential ordinary shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS. For the years ended December 31, 2023, 2022, and 2021, there were no |
Employee benefits | Employee benefits The full-time employees of the Company are entitled to staff welfare benefits including medical care, housing fund, pension benefits, unemployment insurance and other welfare, which are government mandated defined contribution plans. The Company is required to accrue for these benefits based on certain percentages of the employees’ respective salaries, subject to certain ceilings, in accordance with the relevant PRC regulations, and make cash contributions to the state-sponsored plans out of the amounts accrued. Total expenses for the plans were $ 166,199 171,674 135,713 |
Statutory reserves | Statutory reserves Pursuant to the laws applicable to the PRC, PRC entities must make appropriations from after-tax profit to the non-distributable “statutory surplus reserve fund”. Subject to certain cumulative limits, the “statutory surplus reserve fund” requires annual appropriations of 10% of after-tax profits until the aggregated appropriations reach 50% of the registered capital (as determined under accounting principles generally accepted in the PRC (“PRC GAAP”) at each year-end). For foreign invested enterprises and joint ventures in the PRC, annual appropriations should be made to the “reserve fund”. For foreign invested enterprises, the annual appropriation for the “reserve fund” cannot be less than 10% of after-tax profits until the aggregated appropriations reach 50% of the registered capital (as determined under PRC GAAP at each year-end). If the Company has accumulated losses from prior periods, the Company is able to use the current period net income after tax to offset against the accumulated losses. |
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. |
Lease | Lease Effective January 1, 2022, the Company adopted ASU 2016-02, “Leases” (Topic 842), and elected the practical expedients that does not require us to reassess: (1) whether any expired or existing contracts are, or contain, leases, (2) lease classification for any expired or existing leases and (3) initial direct costs for any expired or existing leases. For lease terms of twelve months or fewer, a lessee is permitted to make an accounting policy election not to recognize lease assets and liabilities. The Company recognized ROU assets and lease liabilities of $ 201,180 If any of the following criteria are met, the Company classifies the lease as a finance lease: The lease transfers ownership of the underlying asset to the lessee by the end of the lease term; ● The lease grants the lessee an option to purchase the underlying asset that the Company is reasonably certain to exercise; ● The lease term is for 75% or more of the remaining economic life of the underlying asset, unless the commencement date falls within the last 25% of the economic life of the underlying asset; ● The present value of the sum of the lease payments equals or exceeds 90% of the fair value of the underlying asset; or ● The underlying asset is of such a specialized nature that it is expected to have no alternative use to the lessor at the end of the lease term. Leases that do not meet any of the above criteria are accounted for as operating leases. The Company combines lease and non-lease components in its contracts under Topic 842, when permissible. Operating lease right-of-use (“ROU”) asset and lease liability are recognized at the adoption date of January 1, 2022 or the commencement date, whichever is earlier, based on the present value of lease payments over the lease term. Since the implicit rate for the Company’s leases is not readily determinable, the Company 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 asset 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 for operating lease. The Company reviews the impairment of its ROU asset 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 its operating lease liabilities in any tested asset group and includes the associated operating lease payments in the undiscounted future pre-tax cash flows. For the years ended December 31, 2023 and 2022, the Company did not recognize an impairment loss on its operating lease ROU asset. |
Recently issued accounting pronouncements | Recently issued accounting pronouncements In October 2023, the FASB issued ASU 2023-06, Disclosure Improvements — codification amendments in response to SEC’s disclosure Update and Simplification initiative which amend the disclosure or presentation requirements of codification subtopic 230-10 Statement of Cash Flows—Overall, 250-10 Accounting Changes and Error Corrections— Overall, 260-10 Earnings Per Share— Overall, 270-10 Interim Reporting— Overall, 440-10 Commitments—Overall, 470-10 Debt—Overall, 505-10 Equity—Overall, 815-10 Derivatives and Hedging—Overall, 860-30 Transfers and Servicing—Secured Borrowing and Collateral, 932-235 Extractive Activities— Oil and Gas—Notes to Financial Statements, 946-20 Financial Services— Investment Companies— Investment Company Activities, and 974-10 Real Estate—Real Estate Investment Trusts—Overall. The amendments represent changes to clarify or improve disclosure and presentation requirements of above subtopics. Many of the amendments allow users to more easily compare entities subject to the SEC’s existing disclosures with those entities that were not previously subject to the SEC’s requirements. Also, the amendments align the requirements in the Codification with the SEC’s regulations. For entities subject to existing SEC disclosure requirements or those that must provide financial statements to the SEC for securities purposes without contractual transfer restrictions, the effective date aligns with the date when the SEC removes the related disclosure from Regulation S-X or Regulation S-K. Early adoption is not allowed. For all other entities, the amendments will be effective two years later from the date of the SEC’s removal. The Company is currently evaluating the impact of the update on the Company’s consolidated financial statements and related disclosures. In November 2023, the FASB issued ASU 2023-07, which is an update to Topic 280, Segment Reporting. The amendments in this Update improve financial reporting by requiring disclosure of incremental segment information on an annual and interim basis for all public entities to enable investors to develop more decision-useful financial analyses. The amendments in this update: (1) require that a public entity disclose, on an annual and interim basis, significant segment expenses that are regularly provided to the chief operating decision maker (CODM) and included within each reported measure of segment profit or loss (collectively referred to as the “significant expense principle”), (2) Require that a public entity disclose, on an annual and interim basis, an amount for other segment items by reportable segment and a description of its composition. The other segment items category is the difference between segment revenue less the segment expenses disclosed under the significant expense principle and each reported measure of segment profit or loss, (3) Require that a public entity provide all annual disclosures about a reportable segment’s profit or loss and assets currently required by Topic 280 in interim periods, and (4) Clarify that if the CODM uses more than one measure of a segment’s profit or loss in assessing segment performance and deciding how to allocate resources, a public entity may report one or more of those additional measures of segment profit. However, at least one of the reported segment profit or loss measures (or the single reported measure, if only one is disclosed) should be the measure that is most consistent with the measurement principles used in measuring the corresponding amounts in the public entity’s consolidated financial statements. In other words, in addition to the measure that is most consistent with the measurement principles under generally accepted accounting principles (GAAP), a public entity is not precluded from reporting additional measures of a segment’s profit or loss that are used by the CODM in assessing segment performance and deciding how to allocate resources, (5) Require that a public entity disclose the title and position of the CODM and an explanation of how the CODM uses the reported measure(s) of segment profit or loss in assessing segment performance and deciding how to allocate resources, and (6) Require that a public entity that has a single reportable segment provide all the disclosures required by the amendments in this Update and all existing segment disclosures in Topic 280. The amendments in this Update also do not change how a public entity identifies its operating segments, aggregates those operating segments, or applies the quantitative thresholds to determine its reportable segments. The amendments in this Update are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. A public entity should apply the amendments in this Update retrospectively to all prior periods presented in the financial statements. Upon transition, the segment expense categories and amounts disclosed in the prior periods should be based on the significant segment expense categories identified and disclosed in the period of adoption. The Company is currently evaluating the impact of the update on the Company’s consolidated financial statements and related disclosures. In December 2023, the FASB issued ASU 2023-09, which is an update to Topic 740, Income Taxes. The amendments in this update related to the rate reconciliation and income taxes paid disclosures improve the transparency of income tax disclosures by requiring (1) consistent categories and greater disaggregation of information in the rate reconciliation and (2) income taxes paid disaggregated by jurisdiction. The amendments allow investors to better assess, in their capital allocation decisions, how an entity’s worldwide operations and related tax risks and tax planning and operational opportunities affect its income tax rate and prospects for future cash flows. 5 The other amendments in this Update improve the effectiveness and comparability of disclosures by (1) adding disclosures of pretax income (or loss) and income tax expense (or benefit) to be consistent with U.S. Securities and Exchange Commission (SEC) Regulation S-X 210.4-08(h), Rules of General Application—General Notes to Financial Statements: Income Tax Expense, and (2) removing disclosures that no longer are considered cost beneficial or relevant. For public business entities, the amendments in this Update are effective for annual periods beginning after December 15, 2024. For entities other than public business entities, the amendments are effective for annual periods beginning after December 15, 2025. Early adoption is permitted for annual financial statements that have not yet been issued or made available for issuance. The amendments in this Update should be applied on a prospective basis. Retrospective application is permitted. The Company is currently evaluating the impact of the update on Company’s consolidated financial statements and related disclosures. Except as mentioned above, 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 balance sheets, statements of income and statements of cash flows. |
Nature of business and organi_2
Nature of business and organization (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of subsidiaries | Schedule of subsidiaries Name Background Ownership Chao Qiang Holdings Limited (“CQ BVI”) ● A British Virgin Islands company ● Incorporated on December 14, 2015 ● A holding company 100% owned by CDT Cayman CDT Environmental Technology Group Limited (“CDT BVI”) ● A British Virgin Islands company ● Incorporated on June 26, 2015 ● A holding company 100% owned by CDT Cayman Ultra Leader Investments Limited (“Ultra HK”) ● A Hong Kong company ● Incorporated on February 27, 2015 ● A holding company 100% owned by CQ BVI CDT Environmental Technology (Hong Kong) Limited (“CDT HK”) ● A Hong Kong company ● Incorporated on July 30, 2015 ● A holding company 100% owned by CDT BVI Shenzhen CDT Environmental Technology Co., Ltd. (“Shenzhen CDT”) ● A PRC limited liability company ● Incorporated on August 27, 2012 ● Registered capital of RMB 60,000,000 ● Developing, producing, selling and installing sewage treatment systems and providing sewage treatment services 100% collectively owned by Ultra HK (15%) and CDT HK (85%) Beijing CDT Environmental Technology Co., Ltd. (“BJ CDT”) ● A PRC limited liability company ● Incorporated on April 25, 2016 ● Registered capital of RMB 20,000,000 ● Providing sewage treatment services 100% owned by Shenzhen CDT Fuzhou LSY Environmental Technology Co., Ltd. (“FJ LSY”) ● A PRC limited liability company ● Incorporated on March 13, 2015 ● Registered capital of RMB 5,000,000 ● Providing sewage treatment services 51% owned by Shenzhen CDT Tianjin CDT Environmental Technology Co., Ltd. (“TJ CDT”) ● A PRC limited liability company ● Incorporated on October 22, 2014 ● Registered capital of RMB 10,000,000 ● Providing sewage treatment services 100% owned by Shenzhen CDT Chengde CDT Environmental Technology Co., Ltd. (“CD CDT”) ● A PRC limited liability company ● Incorporated on March 26, 2015 ● Registered capital of RMB 5,000,000 ● Providing sewage treatment services 51% owned by Shenzhen CDT Beijing Innovation CDT Environmental Technology Co., Ltd. (“BJ CX CDT”) ● A PRC limited liability company ● Incorporated on September 7, 2016 ● Registered capital of RMB 5,000,000 ● Providing sewage treatment services 51% owned by Shenzhen CDT Baoding CDT Environmental Technology Co., Ltd. (“BD CDT”) ● A PRC limited liability company ● Incorporated on October 21, 2015 ● Registered capital of RMB 5,000,000 ● Providing sewage treatment services 51% owned by Shenzhen CDT Hengshui CDT Environmental Technology Co., Ltd. (“HS CDT”) ● A PRC limited liability company ● Incorporated on May 18, 2015 ● Registered capital of RMB 3,000,000 ● Providing sewage treatment services 51% owned by Shenzhen CDT Guangxi CWT Environmental Technology Co., Ltd. (“GX CDT”) (2) ● A PRC limited liability company ● Incorporated on January 29, 2016 ● Registered capital of RMB 5,000,000 ● Providing sewage treatment services 51% owned by Shenzhen CDT Huzhou CDT Environmental Technology Co., Ltd. (“HZ CDT”) ● A PRC limited liability company ● Incorporated on February 6, 2015 ● Registered capital of RMB 5,000,000 ● Providing sewage treatment services 51% owned by Shenzhen CDT Hohhot CDT Environmental Technology Co., Ltd. (“HHHT CDT”) ● A PRC limited liability company ● Incorporated on February 11, 2015 ● Registered capital of RMB 5,000,000 ● Providing sewage treatment services 51% owned by Shenzhen CDT Taiyuan CDT Environmental Technology Co., Ltd. (“TY CDT”) ● A PRC limited liability company ● Incorporated on March 23, 2015 ● Registered capital of RMB 5,000,000 ● Providing sewage treatment services 51% owned by Shenzhen CDT Xiamen YDT Environmental Technology Co., Ltd. (“XM YDT”) (1) ● A PRC limited liability company ● Incorporated on April 9, 2015 ● Registered capital of RMB 5,000,000 ● Providing sewage treatment services 51% owned by Shenzhen CDT (1) In January 2022, the Company disposed of its entire 51% ownership in XM YDT and transferred its ownership to a third party for consideration of approximately $5,000. The disposal of XM YDT did not have a material impact on the Company’s consolidated financial statements. (2) In March 2024, the Company disposed of its entire 51% ownership in GX CDT and transferred its ownership to Chun’E Zhao, the legal representative of GX CDT for consideration of RMB 500. The disposal of GX CDT did not have a material impact on the Company’s consolidated financial statements. |
Summary of significant accoun_3
Summary of significant accounting policies (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Schedule of estimated useful lives | Schedule of estimated useful lives Useful Life Building 45 Equipment 4 10 Office equipment, fixtures and furniture 3 5 Automobiles 5 10 |
Accounts receivable, net (Table
Accounts receivable, net (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Credit Loss [Abstract] | |
Schedule of accounts receivable, net | Schedule of accounts receivable, net December 31, December 31, Accounts receivable $ 32,085,912 $ 23,280,417 Allowance for doubtful accounts (3,009,363 ) (3,189,642 ) Total accounts receivable, net $ 29,076,549 $ 20,090,775 |
Schedule of movements of allowance for doubtful accounts | Schedule of movements of allowance for doubtful accounts December 31, December 31, Beginning balance $ 3,189,642 $ 3,004,435 Addition 246,336 555,133 Recovery * (374,078 ) (86,994 ) Exchange rate effect (52,537 ) (282,932 ) Ending balance $ 3,009,363 $ 3,189,642 * The Company recovered account receivable for the years ended December 31, 2023 and 2022 due to collection of account receivable's balance that were allowanced in prior period. |
Contract assets (Tables)
Contract assets (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of contract assets | Schedule of contract assets December 31, December 31, Revenue recognized $ 71,023,301 $ 44,587,741 Less: progress billings (31,857,462 ) (18,497,351 ) Contract assets $ 39,165,839 $ 26,090,390 Contract assets, current $ 34,280,084 $ 16,821,489 Contract assets, non-current $ 4,885,755 $ 9,268,901 |
Property and equipment, net (Ta
Property and equipment, net (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment | Schedule of property and equipment December 31, December 31, Building $ 1,135,160 $ 1,154,409 Equipment 2,103,979 2,298,159 Office equipment, fixtures and furniture 65,765 70,139 Automobiles 851,121 1,248,848 Subtotal 4,156,025 4,771,555 Less: accumulated depreciation (2,460,677 ) (2,574,719 ) Property and equipment, net $ 1,695,348 $ 2,196,836 |
Intangible assets, net (Tables)
Intangible assets, net (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of intangible assets | Schedule of intangible assets December 31, December 31, Patents $ 116,768 $ 118,749 Less: accumulated amortization (100,371 ) (90,585 ) Intangible assets, net $ 16,397 $ 28,164 |
Schedule of estimated amortization | Schedule of estimated amortization Twelve months ending December 31, Estimated 2024 $ 10,685 2025 5,712 Total $ 16,397 |
Loans to third parties (Tables)
Loans to third parties (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Receivables [Abstract] | |
Schedule of loans to third parties | Schedule of loans to third parties Borrower name Maturities Interest Rate December 31, December 31, Fujian Mingzheng Construction Development Ltd. August 2021 (extended to August 2023, repaid in February 2023) 4.4 % $ — $ 14,358 Jinhuo Chen January 2021 (extended to January 2024, repaid in February 2023) 4.4 % — 43,075 Shenzhen Ledoufu Information Technology Ltd. January 2023 (extended to December 2023) 18.0 % — — Total $ — $ 57,433 |
Other payables and accrued li_2
Other payables and accrued liabilities (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Payables and Accruals [Abstract] | |
Schedule of other payables and accrued liabilities | Schedule of other payables and accrued liabilities December 31, December 31, Payables to non-trade vendors and service providers $ 1,773,105 $ 1,618,111 Salary payable 693,396 808,409 Total other payables and accrued liabilities $ 2,466,501 $ 2,426,520 |
Related party balances and tr_2
Related party balances and transactions (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Related Party Transactions [Abstract] | |
Schedule of other receivables - related parties | Schedule of other receivables - related parties Name of Related Party Relationship Nature December 31, December 31, Fujian Tantan Technology Co, Ltd (“FJ Tantan”)* FJ Tantan’s legal representative is the secretary of Fujian Hongfa Group Ltd (“Fujian Hongfa”). Fujian Hongfa is the shareholder of FJ LSY. Interest free, due December 14, 2023 (extended to June 16, 2024) $ 111,259 $ 251,271 Fuzhou Jinhui Environmental service Co, Ltd (“FZ Jinhui”)* Fujian Jinshun environmental Co, Ltd (“Jinshun”) is the major shareholder of FZ Jinhui. Weihao Chen is the Major shareholder of Jinshun, and the legal representative of FZ LSY. Interest free, due on August 31, 2023 (extended to August 31, 2024) 4,459 38,405 Total $ 115,718 $ 289,676 * As of the date of the issuance of these consolidated financial statements, these receivables have been repaid by the related parties. |
Schedule of other payables – related parties | Schedule of other payables – related parties Name of Related Party Relationship Nature December 31, December 31, Wanqiang Lin Director of Ultra HK Advance payment for operational expenses of the Company pending for reimbursement $ 270,806 $ 271,132 |
Schedule of Short-term loans - related parties | Schedule of Short-term loans - related parties Name of Related Party Relationship Nature December 31, December 31, Beijing Minhongyun Energy Supply Co. Ltd. Yunwu Li, the Company’s Chief Executive Officer and Chairman of the Board of Directors and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd is the director of this entity Interest-free loan due on demand $ 1,064,566 $ 1,082,617 Shenzhen Li Yaxin Industrial Co., Ltd Yunwu Li, the Company’s Chief Executive Officer and Chairman of the Company’s Board of Directors and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd., is the sole shareholder of this entity Interest-free loan due on demand 96,009 50,254 Yunwu Li Chairman of CDT Environmental Technology Co., Ltd. Interest-free loan due on demand 3,446,578 2,260,144 Jianzhong Zhao Legal Representative, General Manager and Director of Hohhot CDT Environmental Technology Co., Ltd. Interest-free loans, due on December 31, 2020 (extended to December 31, 2024) 299,772 286,749 Jianshan Ma Director and General Manager of Chengde CDT Environmental Technology Co., Ltd. Interest-free loans, due on December 31, 2020 (extended to December 31, 2024) 117,279 86,516 Yan Wang Relative of Ying Wang, Supervisor of Huzhou CDT Environmental Technology Co., Ltd. Interest-free loans, due on December 31, 2020 (extended to December 31, 2024) 160,052 57,161 Zhaozhao Xu General project manager of Shenzhen CDT Environmental Technology Co., Ltd. Interest-free loans, due on December 31, 2024 32,473 — Yaoyu Zhou Spouse of Ying Wang, Supervisor of Huzhou CDT Environmental Technology Co., Ltd. Interest-free loans, due on November 2, 2024 155,308 — Guangxi Jingxingming Eletrical Ltd The legal representative of this entity is also the legal representative of Guangxi CWT Environmental Technology Co., Ltd. Interest-free loans, due on August 22, 2024 14,119 — Xingsheng Pan General manager of Shenzhen CDT Environmental Technology Co., Ltd Interest-free loans, due on demand — 374,369 Yunfang Li Sibling of Yunwu Li, the Company’s Chief Executive Officer and Chairman of the Board of Directors and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd is the director of this entity Interest-free loans, due on demand — 14,358 Guangqing shi General manager of Tianjin CDT Environmental Technology Co., Ltd Interest-free loans, due on demand — 6,277 Zhaozhao Xu General manager of Shenzhen CDT Environmental Technology Co., Ltd Interest-free loans, due on demand — 12,923 Total $ 5,386,156 $ 4,231,368 |
Credit facilities (Tables)
Credit facilities (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of short-term bank loans | Schedule of short-term bank loans Bank Name Maturities Interest Rate Collateral/ Guarantee December 31, 2023 December 31, 2022 China Construction Bank September 2020 (renewed in December 2021, extended to June 2023, and repaid in June 2023) 5.0 % Guaranteed by Weihao Chen, General Manager of Fuzhou LSY Environmental Technology Co., Ltd. $ — $ 138,127 China Construction Bank December 2023 4.2 % None — 73,658 China Bank of Communication(1) August 2024 4.9 5 % Guaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company, and the line of credit is collateralized by a real estate property owned by Yunwu Li. 423,567 430,750 China Bank of Communication(1) January 2024 (extended to December 2024) 4.6 % Guaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company, and the line of credit is collateralized by a real estate property owned by Yunwu Li. 705,945 — Industrial and Commercial Bank of China February 2023 (repaid in February 2023) 3.8 % None — 100,508 Weizhong Bank August 2023 (repaid in August 2023) 5.9 % Guaranteed by Yunhui Xu, the legal representative of TY CDT — 37,691 Weizhong Bank June 2023 (repaid in June 2023) 5.1 % Guaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd. — 63,177 China resource bank March 2024 (repaid in March 2024) 5.8 % Guaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd. 412,272 — Postal saving bank of China (2) June 2024 5.7 % Guaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd. 564,756 — Bank of China November 2024 3.9 % Guaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd 415,096 China Construction Bank December 2024 4.0 % Guaranteed by Chun’E Zhao, the legal representative of Guangxi CWT Environmental Technology Co., Ltd. 52,240 — Weizhong Bank February 2025 6.1 9.7 % Guaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd. 154,509 — Total $ 2,728,385 $ 843,911 (1) In August 2022, the Company secured a renewable line of credit (“Line of Credit 1”) worth approximately $1.1 million from China Bank of Communication for a two-year period. This line of credit is backed by the guarantee of Yunwu Li, the Chief Executive Officer and Chairman of the Board of Directors of the Company, and it is secured by a real estate property owned by Yunwu Li. As of December 31, 2022, the Company has withdrawn two separate loans with an aggregated total of approximately $0.4 million from Line of Credit 1 to be due in August 2023 with 4.9% to 5.0% interest rate per annum. In August 2023, the Company has repaid approximately $0.4 million to Line of Credit 1. In August 2023, the Company has withdrawn another loan of approximately $0.4 million from line of Credit 1 to be due in August 2024 with 4.5% interest rate per annum. (2) In June 2023, the Company secured a renewable line of credit ("Line of Credit 2") worth approximately $0.6 million from Postal Savings Bank of China for a two-year term. This line of credit is guaranteed by Yunwu Li, the Chief Executive Officer and Chairman of the Board of Directors of the Company. Simultaneously, on the same date, the Company withdrew approximately $0.6 million from Line of Credit 2, which carries an interest rate of 5.7% and is set to mature in June 2024. (3) Represent balance due within the next twelve months from below long-term loans – bank. |
Schedule of long-term loans- bank | Schedule of long-term loans- bank Bank Name Maturities Interest Collateral/Guarantee December 31, December 31, Weizhong Bank July 2023 (renewal to February 2025) 6.1 9.7 % Guaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd. $ 79,463 $ 47,861 |
Schedule of short-term loans- third parties | Schedule of short-term loans- third parties Lender Name Maturities Interest Rate Collateral/ Guarantee December 31, December 31, Deyun Zhou February 2023 (repaid in January 2023) 0 % None $ — $ 71,792 Lingyu Ye December 2019 (renewed in December 2020, extended to December 2024) 0 % None 28,237 28,717 Runze Li December 2024 0 % None 43,769 109,267 Shanghai Xinjing Construction Labor Service Center August 2021 (extended to June 2024) 0 % None 211,784 215,375 Xiamen Haosheng Investing Co., Ltd. April 2020 (extended to April 2024) 0 % None 28,238 28,716 Total $ 312,028 $ 453,867 |
Taxes (Tables)
Taxes (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
.Schedule of significant components of the provision for income taxes | .Schedule of significant components of the provision for income taxes For the year ended December 31, 2023 For the year ended December 31, 2022 For the year ended December 31, 2021 Current $ 1,357,135 $ 1,119,640 $ 904,761 Deferred 46,745 33,323 303,049 Provision for income taxes $ 1,403,880 $ 1,152,963 $ 1,207,810 |
Schedule of effective tax rate | Schedule of effective tax rate For the year ended December 31, 2023 For the year ended December 31, 2022 For the year ended December 31, 2021 China statutory income tax rate 25.0 % 25.0 % 25.0 % Preferential tax rate reduction (8.8 %) (7.6 %) (10.3 %) Change in valuation allowance 0.7 % 0.5 % 0.7 % Permanent difference* 0.1 % 0.1 % 0.1 % Effective tax rate 17.0 % 18.0 % 15.5 % * Permanent difference mainly consisted of the meal and entertainment expenses which is partially non-deductible under PRC income tax law. |
Schedule of deferred tax assets | Schedule of deferred tax assets December 31, December 31, Allowance for doubtful accounts $ 400,704 $ 444,857 Net operating loss carryforwards 334,805 321,754 Valuation allowance (482,627 ) (462,144 ) Deferred tax assets, net $ 252,882 $ 304,467 |
Schedule of taxes payable | Schedule of taxes payable December 31, December 31, VAT taxes payable $ 775,847 $ 1,463,890 Income taxes payable 4,633,460 3,346,842 Other taxes payable 14,648 52,845 Totals $ 5,423,955 $ 4,863,577 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Leases | |
Schedule of lease liabilities remaining operating leases | Schedule of lease liabilities remaining operating leases Twelve months ending December 31, Operating lease payment 2024 $ 127,669 2025 40,891 2026 34,950 2027 35,998 2028 and thereafter 3,029 Total undiscounted lease payments 242,537 Less imputed interest (17,724 ) Total lease liabilities $ 224,813 Lease liabilities, current $ 118,833 Lease liabilities, non-current $ 105,980 |
Schedule of operating lease cost | Schedule of operating lease cost For the year ended December 31, 2023 For the year ended December 31, 2022 For the year ended December 31, 2021 Operating lease cost $ 109,184 $ 98,690 $ 267,900 Short-term lease cost 105,517 193,525 — Total $ 214,701 $ 292,215 $ 267,900 |
Commitments and contingencies (
Commitments and contingencies (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of future minimum property management expenses | Schedule of future minimum property management expenses Twelve months ending December 31, Management fee commitment 2024 $ 4,134 |
Enterprise wide disclosure (Tab
Enterprise wide disclosure (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Segment Reporting [Abstract] | |
Schedule of disaggregated information | Schedule of disaggregated information For the year ended December 31, 2023 For the year ended December 31, 2022 For the year ended December 31, 2021 Sewage treatment systems $ 32,267,593 $ 26,552,481 $ 20,272,996 Sewage treatment services and others 1,942,326 2,296,881 3,283,824 Total revenues $ 34,209,919 $ 28,849,362 $ 23,556,820 For the year ended December 31, 2023 For the year ended December 31, 2022 For the year ended December 31, 2021 Sewage treatment systems $ 21,630,216 $ 17,170,669 $ 12,816,882 Sewage treatment services and others 1,194,817 1,425,538 2,245,608 Total cost of revenues $ 22,825,033 $ 18,596,207 $ 15,062,490 For the year ended December 31, 2023 For the year ended December 31, 2022 For the year ended December 31, 2021 Sewage treatment systems $ 10,637,377 $ 9,381,812 $ 7,456,114 Sewage treatment services and others 747,509 871,343 1,038,216 Total gross profit $ 11,384,886 $ 10,253,155 $ 8,494,330 |
Condensed financial informati_2
Condensed financial information of the parent company (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Condensed Financial Information Disclosure [Abstract] | |
Schedule of balance sheets | Schedule of balance sheets December 31, 2023 December 31, 2022 ASSETS OTHER ASSET Investment in subsidiaries $ 31,902,645 $ 25,003,739 Total asset $ 31,902,645 $ 25,003,739 LIABILITIES AND SHAREHOLDERS’ EQUITY LIABILITIES $ — $ — COMMITMENTS AND CONTINGENCIES — — SHAREHOLDERS’ EQUITY Ordinary shares, $0.0025 par value, 20,000,000 shares authorized, and 9,200,000 shares outstanding as of December 31, 2023 and 2022 23,000 23,000 Additional paid-in capital 7,453,265 7,453,265 Statutory reserves 3,192,855 2,396,539 Retained earnings 23,242,946 16,621,556 Accumulated other comprehensive loss (2,009,421 ) (1,490,621 ) Total shareholders’ equity 31,902,645 25,003,739 Total liabilities and shareholders’ equity $ 31,902,645 $ 25,003,739 |
Schedule of income and comprehensive income | Schedule of income and comprehensive income For the years ended December 31, 2023 2022 2021 EQUITY INCOME OF SUBSIDIARIES $ 7,417,705 $ 5,782,018 $ 6,775,739 NET INCOME 7,417,705 5,782,018 6,775,739 FOREIGN CURRENCY TRANSLATION ADJUSTMENT (518,799 ) (2,050,374 ) 347,249 COMPREHENSIVE INCOME $ 6,898,906 $ 3,731,644 $ 7,122,988 |
Schedule of cash flows | Schedule of cash flows For the years ended December 31, 2023 2022 2021 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 7,417,705 $ 5,782,018 $ 6,775,739 Adjustments to reconcile net income to cash used in operating activities: Equity income of subsidiaries (7,417,705 ) (5,782,018 ) (6,775,739 ) Net cash used in operating activities — — — CHANGES IN CASH — — — CASH, beginning of year — — — CASH, end of year $ — $ — $ — |
Nature of business and organi_3
Nature of business and organization (Details) | 12 Months Ended | |
Dec. 31, 2023 | ||
C Q B V I [Member] | ||
Place of incorporation | A British Virgin Islands company | |
Incorporation date | Incorporated on December 14, 2015 | |
Principal activites | A holding company | |
Ownership | 100% owned by CDT Cayman | |
C D T B V I [Member] | ||
Place of incorporation | A British Virgin Islands company | |
Incorporation date | Incorporated on June 26, 2015 | |
Principal activites | A holding company | |
Ownership | 100% owned by CDT Cayman | |
Ultra H K [Member] | ||
Place of incorporation | A Hong Kong company | |
Incorporation date | Incorporated on February 27, 2015 | |
Principal activites | A holding company | |
Ownership | 100% owned by CQ BVI | |
C D T H K [Member] | ||
Place of incorporation | A Hong Kong company | |
Incorporation date | Incorporated on July 30, 2015 | |
Principal activites | A holding company | |
Ownership | 100% owned by CDT BVI | |
Shenzhen C D T [Member] | ||
Incorporation date | Incorporated on August 27, 2012 | |
Principal activites | Developing, producing, selling and installing sewage treatment systems and providing sewage treatment services | |
Ownership | 100% collectively owned by Ultra HK (15%) and CDT HK (85%) | |
Nature of company | A PRC limited liability company | |
Registered capital | Registered capital of RMB 60,000,000 | |
B J C D T [Member] | ||
Incorporation date | Incorporated on April 25, 2016 | |
Principal activites | Providing sewage treatment services | |
Ownership | 100% owned by Shenzhen CDT | |
Nature of company | A PRC limited liability company | |
Registered capital | Registered capital of RMB 20,000,000 | |
F J L S Y [Member] | ||
Incorporation date | Incorporated on March 13, 2015 | |
Principal activites | Providing sewage treatment services | |
Ownership | 51% owned by Shenzhen CDT | |
Nature of company | A PRC limited liability company | |
Registered capital | Registered capital of RMB 5,000,000 | |
T J C D T [Member] | ||
Incorporation date | Incorporated on October 22, 2014 | |
Principal activites | Providing sewage treatment services | |
Ownership | 100% owned by Shenzhen CDT | |
Nature of company | A PRC limited liability company | |
Registered capital | Registered capital of RMB 10,000,000 | |
C D C D T [Member] | ||
Incorporation date | Incorporated on March 26, 2015 | |
Principal activites | Providing sewage treatment services | |
Ownership | 51% owned by Shenzhen CDT | |
Nature of company | A PRC limited liability company | |
Registered capital | Registered capital of RMB 5,000,000 | |
B J C X C D T [Member] | ||
Incorporation date | Incorporated on September 7, 2016 | |
Principal activites | Providing sewage treatment services | |
Ownership | 51% owned by Shenzhen CDT | |
Nature of company | A PRC limited liability company | |
Registered capital | Registered capital of RMB 5,000,000 | |
B D C D T [Member] | ||
Incorporation date | Incorporated on October 21, 2015 | |
Principal activites | Providing sewage treatment services | |
Ownership | 51% owned by Shenzhen CDT | |
Nature of company | A PRC limited liability company | |
Registered capital | Registered capital of RMB 5,000,000 | |
H S C D T [Member] | ||
Incorporation date | Incorporated on May 18, 2015 | |
Principal activites | Providing sewage treatment services | |
Ownership | 51% owned by Shenzhen CDT | |
Nature of company | A PRC limited liability company | |
Registered capital | Registered capital of RMB 3,000,000 | |
G X C D T [Member] | ||
Incorporation date | Incorporated on January 29, 2016 | [1] |
Principal activites | Providing sewage treatment services | [1] |
Ownership | 51% owned by Shenzhen CDT | [1] |
Nature of company | A PRC limited liability company | [1] |
Registered capital | Registered capital of RMB 5,000,000 | [1] |
H Z C D T [Member] | ||
Incorporation date | Incorporated on February 6, 2015 | |
Principal activites | Providing sewage treatment services | |
Ownership | 51% owned by Shenzhen CDT | |
Nature of company | A PRC limited liability company | |
Registered capital | Registered capital of RMB 5,000,000 | |
H H H T C D T [Member] | ||
Incorporation date | Incorporated on February 11, 2015 | |
Principal activites | Providing sewage treatment services | |
Ownership | 51% owned by Shenzhen CDT | |
Nature of company | A PRC limited liability company | |
Registered capital | Registered capital of RMB 5,000,000 | |
T Y C D T [Member] | ||
Incorporation date | Incorporated on March 23, 2015 | |
Principal activites | Providing sewage treatment services | |
Ownership | 51% owned by Shenzhen CDT | |
Nature of company | A PRC limited liability company | |
Registered capital | Registered capital of RMB 5,000,000 | |
X M Y D T [Member] | ||
Incorporation date | Incorporated on April 9, 2015 | [2] |
Principal activites | Providing sewage treatment services | [2] |
Ownership | 51% owned by Shenzhen CDT | [2] |
Nature of company | A PRC limited liability company | [2] |
Registered capital | Registered capital of RMB 5,000,000 | [2] |
[1]In March 2024, the Company disposed of its entire 51% ownership in GX CDT and transferred its ownership to Chun’E Zhao, the legal representative of GX CDT for consideration of RMB 500. The disposal of GX CDT did not have a material impact on the Company’s consolidated financial statements. [2]In January 2022, the Company disposed of its entire 51% ownership in XM YDT and transferred its ownership to a third party for consideration of approximately $5,000. The disposal of XM YDT did not have a material impact on the Company’s consolidated financial statements. |
Liquidity (Details Narrative)
Liquidity (Details Narrative) - USD ($) | 12 Months Ended | ||
Apr. 22, 2024 | Dec. 31, 2023 | Dec. 31, 2022 | |
Subsidiary, Sale of Stock [Line Items] | |||
Working capital | $ 24,200,000 | $ 12,900,000 | |
Cash Equivalents, at Carrying Value | 300,000 | ||
Accounts Receivable, after Allowance for Credit Loss, Current | 29,076,549 | 20,090,775 | |
Contract assets, current | 34,280,084 | $ 16,821,489 | |
Realization of account receivable | $ 5,600,000 | ||
Subsequent Event [Member] | |||
Subsidiary, Sale of Stock [Line Items] | |||
Net preoceeds pubic offering | $ 600,000 | ||
IPO [Member] | Subsequent Event [Member] | |||
Subsidiary, Sale of Stock [Line Items] | |||
Shares issued | 1,500,000 | ||
Shares price | $ 4 | ||
Net preoceeds pubic offering | $ 4,300,000 | ||
Net preoceeds pubic offering | $ 600,000 |
Summary of significant accoun_4
Summary of significant accounting policies (Details) | Dec. 31, 2023 |
Building [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of assets | 45 years |
Equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of assets | 4 years |
Equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of assets | 10 years |
Furniture and Fixtures [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of assets | 3 years |
Furniture and Fixtures [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of assets | 5 years |
Automobiles [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of assets | 5 years |
Automobiles [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of assets | 10 years |
Summary of significant accoun_5
Summary of significant accounting policies (Details Narrative) | 12 Months Ended | |||
Dec. 31, 2023 USD ($) shares | Dec. 31, 2022 USD ($) shares | Dec. 31, 2021 USD ($) shares | Jan. 02, 2022 USD ($) | |
Product Information [Line Items] | ||||
Accumulated other comprehensive loss | $ 2,009,421 | $ 1,490,621 | ||
Allowance for credit loss | 500,857 | 474,758 | ||
Bad debt expense for other receivable | 34,189 | 144,415 | $ 37,032 | |
Impairment loss | 0 | 0 | ||
Prepayments | 500,000 | |||
Allowance for doubtful account prepayment | 173,736 | 171,286 | ||
Impairment of long-lived assets | 0 | 0 | ||
Warrant provision | 0 | 0 | 0 | |
Advertising costs | 22,677 | 61,566 | 95,808 | |
R&D expenses | $ 80,948 | $ 112,668 | $ 136,690 | |
Potential dilutive shares | shares | 0 | 0 | 0 | |
Expenses | $ 166,199 | $ 171,674 | $ 135,713 | |
ROU assets | 210,058 | $ 310,443 | $ 201,180 | |
Operating lease liabilities | 224,813 | $ 201,180 | ||
Sewage Treatment Services [Member] | ||||
Product Information [Line Items] | ||||
Revenue remaining performance obligations | 562,609 | |||
Sewage Treatment Services 1 [Member] | ||||
Product Information [Line Items] | ||||
Revenue remaining performance obligations | $ 483,698 | |||
China, Yuan Renminbi | ||||
Product Information [Line Items] | ||||
Foreign currency exchange rate, translation | 7.08 | 6.96 | ||
Foreign currency average translation rates | 7.05 | 6.73 | 6.45 | |
Hong Kong, Dollars | ||||
Product Information [Line Items] | ||||
Foreign currency exchange rate, translation | 7.81 | 7.80 | ||
Foreign currency average translation rates | 7.83 | 7.83 | 7.77 |
Accounts receivable, net (Detai
Accounts receivable, net (Details) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Credit Loss [Abstract] | |||
Accounts receivable | $ 32,085,912 | $ 23,280,417 | |
Allowance for doubtful accounts | (3,009,363) | (3,189,642) | $ (3,004,435) |
Total accounts receivable, net | $ 29,076,549 | $ 20,090,775 |
Accounts receivable, net (Det_2
Accounts receivable, net (Details 1) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | ||
Credit Loss [Abstract] | |||
Beginning balance | $ 3,189,642 | $ 3,004,435 | |
Addition | 246,336 | 555,133 | |
Recovery | [1] | (374,078) | (86,994) |
Exchange rate effect | (52,537) | (282,932) | |
Ending balance | $ 3,009,363 | $ 3,189,642 | |
[1]The Company recovered account receivable for the years ended December 31, 2023 and 2022 due to collection of account receivable's balance that were allowanced in prior period. |
Contract assets (Details)
Contract assets (Details) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 |
Revenue from Contract with Customer [Abstract] | ||
Revenue recognized | $ 71,023,301 | $ 44,587,741 |
Less: progress billings | (31,857,462) | (18,497,351) |
Contract assets | 39,165,839 | 26,090,390 |
Contract assets, current | 34,280,084 | 16,821,489 |
Contract assets, non-current | $ 4,885,755 | $ 9,268,901 |
Property and equipment, net (De
Property and equipment, net (Details) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, net | $ 4,156,025 | $ 4,771,555 |
Less: accumulated depreciation | (2,460,677) | (2,574,719) |
Property and equipment, net | 1,695,348 | 2,196,836 |
Building [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, net | 1,135,160 | 1,154,409 |
Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, net | 2,103,979 | 2,298,159 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, net | 65,765 | 70,139 |
Automobiles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, net | $ 851,121 | $ 1,248,848 |
Property and equipment, net (_2
Property and equipment, net (Details Narrative) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation expense | $ 331,336 | $ 383,827 | $ 282,838 |
Intangible assets, net (Details
Intangible assets, net (Details) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Patents | $ 116,768 | $ 118,749 |
Less: accumulated amortization | (100,371) | (90,585) |
Intangible assets, net | $ 16,397 | $ 28,164 |
Intangible assets, net (Detai_2
Intangible assets, net (Details 1) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2024 | $ 10,685 | |
2025 | 5,712 | |
Total | $ 16,397 | $ 28,164 |
Intangible assets, net (Detai_3
Intangible assets, net (Details Narrative) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Amortization expense | $ 11,355 | $ 14,434 | $ 10,369 |
Loans to third parties (Details
Loans to third parties (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Financing Receivable, Past Due [Line Items] | ||
Loans to third parties | $ 0 | $ 57,433 |
Fujian Mingzheng Construction Development Ltd [Member] | ||
Financing Receivable, Past Due [Line Items] | ||
Maturities | August 2021 (extended to August 2023, repaid in February 2023) | |
Interest Rate | 4.40% | |
Loans to third parties | $ 0 | 14,358 |
Jinhuo Chen [Member] | ||
Financing Receivable, Past Due [Line Items] | ||
Maturities | January 2021 (extended to January 2024, repaid in February 2023) | |
Interest Rate | 4.40% | |
Loans to third parties | $ 0 | 43,075 |
Shenzhen Ledoufu Information Technology Ltd [Member] | ||
Financing Receivable, Past Due [Line Items] | ||
Maturities | January 2023 (extended to December 2023) | |
Interest Rate | 18% | |
Loans to third parties | $ 0 |
Other payables and accrued li_3
Other payables and accrued liabilities (Details) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 |
Payables and Accruals [Abstract] | ||
Payables to non-trade vendors and service providers | $ 1,773,105 | $ 1,618,111 |
Salary payable | 693,396 | 808,409 |
Total other payables and accrued liabilities | $ 2,466,501 | $ 2,426,520 |
Related party balances and tr_3
Related party balances and transactions (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | ||
Related Party Transaction [Line Items] | |||
Other receivables - related parties | $ 115,718 | $ 289,676 | |
Fujian Tantan Technology Co Ltd [Member] | |||
Related Party Transaction [Line Items] | |||
Relationship description | [1] | FJ Tantan’s legal representative is the secretary of Fujian Hongfa Group Ltd (“Fujian Hongfa”). Fujian Hongfa is the shareholder of FJ LSY. | |
Nature description | [1] | Interest free, due December 14, 2023 (extended to June 16, 2024) | |
Other receivables - related parties | [1] | $ 111,259 | 251,271 |
Fuzhou Jinhui Environmental Service Co Ltd [Member] | |||
Related Party Transaction [Line Items] | |||
Relationship description | [1] | Fujian Jinshun environmental Co, Ltd (“Jinshun”) is the major shareholder of FZ Jinhui. Weihao Chen is the Major shareholder of Jinshun, and the legal representative of FZ LSY. | |
Nature description | [1] | Interest free, due on August 31, 2023 (extended to August 31, 2024) | |
Other receivables - related parties | [1] | $ 4,459 | $ 38,405 |
[1]As of the date of the issuance of these consolidated financial statements, these receivables have been repaid by the related parties. |
Related party balances and tr_4
Related party balances and transactions (Details 1) - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Related Party Transaction [Line Items] | ||
Other receivables - related parties | $ 270,806 | $ 271,132 |
Wanqiang Lin [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship description | Director of Ultra HK | |
Nature description | Advance payment for operational expenses of the Company pending for reimbursement | |
Other receivables - related parties | $ 270,806 | $ 271,132 |
Related party balances and tr_5
Related party balances and transactions (Details 2) - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Related Party Transaction [Line Items] | ||
Other receivables - related parties | $ 5,386,156 | $ 4,231,368 |
Beijing Minhongyun Energy Supply Co Ltd [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship description | Yunwu Li, the Company’s Chief Executive Officer and Chairman of the Board of Directors and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd is the director of this entity | |
Nature description | Interest-free loan due on demand | |
Other receivables - related parties | $ 1,064,566 | 1,082,617 |
Shenzhen Li Yaxin Industrial Co Ltd [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship description | Yunwu Li, the Company’s Chief Executive Officer and Chairman of the Company’s Board of Directors and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd., is the sole shareholder of this entity | |
Nature description | Interest-free loan due on demand | |
Other receivables - related parties | $ 96,009 | 50,254 |
Yunwu Li [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship description | Chairman of CDT Environmental Technology Co., Ltd. | |
Nature description | Interest-free loan due on demand | |
Other receivables - related parties | $ 3,446,578 | 2,260,144 |
Jianzhong Zhao [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship description | Legal Representative, General Manager and Director of Hohhot CDT Environmental Technology Co., Ltd. | |
Nature description | Interest-free loans, due on December 31, 2020 (extended to December 31, 2024) | |
Other receivables - related parties | $ 299,772 | 286,749 |
Jianshan Ma [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship description | Director and General Manager of Chengde CDT Environmental Technology Co., Ltd. | |
Nature description | Interest-free loans, due on December 31, 2020 (extended to December 31, 2024) | |
Other receivables - related parties | $ 117,279 | 86,516 |
Yan Wang [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship description | Relative of Ying Wang, Supervisor of Huzhou CDT Environmental Technology Co., Ltd. | |
Nature description | Interest-free loans, due on December 31, 2020 (extended to December 31, 2024) | |
Other receivables - related parties | $ 160,052 | 57,161 |
Zhaozhao Xu [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship description | General project manager of Shenzhen CDT Environmental Technology Co., Ltd. | |
Nature description | Interest-free loans, due on December 31, 2024 | |
Other receivables - related parties | $ 32,473 | 0 |
Yaoyu Zhou [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship description | Spouse of Ying Wang, Supervisor of Huzhou CDT Environmental Technology Co., Ltd. | |
Nature description | Interest-free loans, due on November 2, 2024 | |
Other receivables - related parties | $ 155,308 | 0 |
Guangxi Jingxingming Eletrical Ltd [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship description | The legal representative of this entity is also the legal representative of Guangxi CWT Environmental Technology Co., Ltd. | |
Nature description | Interest-free loans, due on August 22, 2024 | |
Other receivables - related parties | $ 14,119 | 0 |
Xingsheng Pan [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship description | General manager of Shenzhen CDT Environmental Technology Co., Ltd | |
Nature description | Interest-free loans, due on demand | |
Other receivables - related parties | $ 0 | 374,369 |
Yunfang Li [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship description | Sibling of Yunwu Li, the Company’s Chief Executive Officer and Chairman of the Board of Directors and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd is the director of this entity | |
Nature description | Interest-free loans, due on demand | |
Other receivables - related parties | $ 0 | 14,358 |
Guangqing Shi [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship description | General manager of Tianjin CDT Environmental Technology Co., Ltd | |
Nature description | Interest-free loans, due on demand | |
Other receivables - related parties | $ 0 | 6,277 |
Zhaozhao Xu One [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship description | General manager of Shenzhen CDT Environmental Technology Co., Ltd | |
Nature description | Interest-free loans, due on demand | |
Other receivables - related parties | $ 0 | 12,923 |
Wanqiang Lin [Member] | ||
Related Party Transaction [Line Items] | ||
Relationship description | Director of Ultra HK | |
Other receivables - related parties | $ 5,386,156 | $ 4,231,368 |
Credit facilities (Details)
Credit facilities (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | ||
Line of Credit Facility [Line Items] | |||
Short term loans banks | $ 2,728,385 | $ 843,911 | |
China Construction Bank [Member] | |||
Line of Credit Facility [Line Items] | |||
Credit facilities maturities descriptions | September 2020 (renewed in December 2021, extended to June 2023, and repaid in June 2023) | ||
Credit facilities interest rate | 5% | ||
Credit facilities collateral guarantee descriptions | Guaranteed by Weihao Chen, General Manager of Fuzhou LSY Environmental Technology Co., Ltd. | ||
Short term loans banks | 138,127 | ||
China Construction Bank One [Member] | |||
Line of Credit Facility [Line Items] | |||
Credit facilities maturities descriptions | December 2023 | ||
Credit facilities interest rate | 4.20% | ||
Credit facilities collateral guarantee descriptions | None | ||
Short term loans banks | 73,658 | ||
China Bankof Communication [Member] | |||
Line of Credit Facility [Line Items] | |||
Credit facilities maturities descriptions | [1] | August 2024 | |
Credit facilities collateral guarantee descriptions | [1] | Guaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company, and the line of credit is collateralized by a real estate property owned by Yunwu Li. | |
Short term loans banks | [1] | $ 423,567 | 430,750 |
China Bankof Communication [Member] | Maximum [Member] | |||
Line of Credit Facility [Line Items] | |||
Credit facilities interest rate | [1] | 4.90% | |
China Bankof Communication [Member] | Minimum [Member] | |||
Line of Credit Facility [Line Items] | |||
Credit facilities interest rate | [1] | 5% | |
China Bankof Communication One [Member] | |||
Line of Credit Facility [Line Items] | |||
Credit facilities maturities descriptions | [1] | January 2024 (extended to December 2024) | |
Credit facilities interest rate | [1] | 4.60% | |
Credit facilities collateral guarantee descriptions | [1] | Guaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company, and the line of credit is collateralized by a real estate property owned by Yunwu Li. | |
Short term loans banks | [1] | $ 705,945 | |
Industrial And Commercial Bank Of China [Member] | |||
Line of Credit Facility [Line Items] | |||
Credit facilities maturities descriptions | February 2023 (repaid in February 2023) | ||
Credit facilities interest rate | 3.80% | ||
Credit facilities collateral guarantee descriptions | None | ||
Short term loans banks | 100,508 | ||
Weizhong Bank [Member] | |||
Line of Credit Facility [Line Items] | |||
Credit facilities maturities descriptions | August 2023 (repaid in August 2023) | ||
Credit facilities interest rate | 5.90% | ||
Credit facilities collateral guarantee descriptions | Guaranteed by Yunhui Xu, the legal representative of TY CDT | ||
Short term loans banks | 37,691 | ||
Weizhong Bank One [Member] | |||
Line of Credit Facility [Line Items] | |||
Credit facilities maturities descriptions | June 2023 (repaid in June 2023) | ||
Credit facilities interest rate | 5.10% | ||
Credit facilities collateral guarantee descriptions | Guaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd. | ||
Short term loans banks | $ 63,177 | ||
China Resource Bank [Member] | |||
Line of Credit Facility [Line Items] | |||
Credit facilities maturities descriptions | March 2024 (repaid in March 2024) | ||
Credit facilities interest rate | 5.80% | ||
Credit facilities collateral guarantee descriptions | Guaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd. | ||
Short term loans banks | $ 412,272 | ||
Postal Saving Bank Of China [Member] | |||
Line of Credit Facility [Line Items] | |||
Credit facilities maturities descriptions | [2] | June 2024 | |
Credit facilities interest rate | [2] | 5.70% | |
Credit facilities collateral guarantee descriptions | [2] | Guaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd. | |
Short term loans banks | [2] | $ 564,756 | |
Bank Of China [Member] | |||
Line of Credit Facility [Line Items] | |||
Credit facilities maturities descriptions | November 2024 | ||
Credit facilities interest rate | 3.90% | ||
Credit facilities collateral guarantee descriptions | Guaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd | ||
Short term loans banks | $ 415,096 | ||
China Construction Bank Two [Member] | |||
Line of Credit Facility [Line Items] | |||
Credit facilities maturities descriptions | December 2024 | ||
Credit facilities interest rate | 4% | ||
Credit facilities collateral guarantee descriptions | Guaranteed by Chun’E Zhao, the legal representative of Guangxi CWT Environmental Technology Co., Ltd. | ||
Short term loans banks | $ 52,240 | ||
Weizhong Bank Two [Member] | |||
Line of Credit Facility [Line Items] | |||
Credit facilities maturities descriptions | [3] | February 2025 | |
Credit facilities collateral guarantee descriptions | Guaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd. | ||
Short term loans banks | $ 154,509 | ||
Weizhong Bank Two [Member] | Maximum [Member] | |||
Line of Credit Facility [Line Items] | |||
Credit facilities interest rate | 6.10% | ||
Weizhong Bank Two [Member] | Minimum [Member] | |||
Line of Credit Facility [Line Items] | |||
Credit facilities interest rate | 9.70% | ||
[1]In August 2022, the Company secured a renewable line of credit (“Line of Credit 1”) worth approximately $1.1 million from China Bank of Communication for a two-year period. This line of credit is backed by the guarantee of Yunwu Li, the Chief Executive Officer and Chairman of the Board of Directors of the Company, and it is secured by a real estate property owned by Yunwu Li. As of December 31, 2022, the Company has withdrawn two separate loans with an aggregated total of approximately $0.4 million from Line of Credit 1 to be due in August 2023 with 4.9% to 5.0% interest rate per annum. In August 2023, the Company has repaid approximately $0.4 million to Line of Credit 1. In August 2023, the Company has withdrawn another loan of approximately $0.4 million from line of Credit 1 to be due in August 2024 with 4.5% interest rate per annum.[2]In June 2023, the Company secured a renewable line of credit ("Line of Credit 2") worth approximately $0.6 million from Postal Savings Bank of China for a two-year term. This line of credit is guaranteed by Yunwu Li, the Chief Executive Officer and Chairman of the Board of Directors of the Company. Simultaneously, on the same date, the Company withdrew approximately $0.6 million from Line of Credit 2, which carries an interest rate of 5.7% and is set to mature in June 2024.[3]Represent balance due within the next twelve months from below long-term loans – bank. |
Credit facilities (Details 1)
Credit facilities (Details 1) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | ||
Line of Credit Facility [Line Items] | |||
Long term loans bank | $ 79,463 | $ 47,861 | |
Weizhong Bank [Member] | |||
Line of Credit Facility [Line Items] | |||
Long term loans bank maturities descriptions | July 2023 (renewal to February 2025) | ||
Long term loans bank collateral guarantee descriptions | [1] | Guaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd. | |
Long term loans bank | $ 79,463 | $ 47,861 | |
Weizhong Bank [Member] | Maximum [Member] | |||
Line of Credit Facility [Line Items] | |||
Long term loans bank interest rate | [1] | 6.10% | |
Weizhong Bank [Member] | Minimum [Member] | |||
Line of Credit Facility [Line Items] | |||
Long term loans bank interest rate | [1] | 9.70% | |
[1]Permanent difference mainly consisted of the meal and entertainment expenses which is partially non-deductible under PRC income tax law. |
Credit facilities (Details 2)
Credit facilities (Details 2) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | ||
Line of Credit Facility [Line Items] | |||
Short term loans third parties | $ 312,028 | $ 453,867 | |
Deyun Zhou [Member] | |||
Line of Credit Facility [Line Items] | |||
Short term loans third parties maturities descriptions | February 2023 (repaid in January 2023) | ||
Short term loans third parties interest rate | [1] | 0% | |
Short term loans third parties collateral guarantee descriptions | [1] | None | |
Short term loans third parties | 71,792 | ||
Lingyu Ye [Member] | |||
Line of Credit Facility [Line Items] | |||
Short term loans third parties maturities descriptions | December 2019 (renewed in December 2020, extended to December 2024) | ||
Short term loans third parties interest rate | [1] | 0% | |
Short term loans third parties collateral guarantee descriptions | [1] | None | |
Short term loans third parties | $ 28,237 | 28,717 | |
Runze Li [Member] | |||
Line of Credit Facility [Line Items] | |||
Short term loans third parties maturities descriptions | December 2024 | ||
Short term loans third parties interest rate | [1] | 0% | |
Short term loans third parties collateral guarantee descriptions | [1] | None | |
Short term loans third parties | $ 43,769 | 109,267 | |
Shanghai Xinjing Construction Labor Service Center [Member] | |||
Line of Credit Facility [Line Items] | |||
Short term loans third parties maturities descriptions | August 2021 (extended to June 2024) | ||
Short term loans third parties interest rate | [1] | 0% | |
Short term loans third parties collateral guarantee descriptions | [1] | None | |
Short term loans third parties | $ 211,784 | 215,375 | |
Xiamen Haosheng Investing Co Ltd [Member] | |||
Line of Credit Facility [Line Items] | |||
Short term loans third parties maturities descriptions | April 2020 (extended to April 2024) | ||
Short term loans third parties interest rate | [1] | 0% | |
Short term loans third parties collateral guarantee descriptions | [1] | None | |
Short term loans third parties | $ 28,238 | $ 28,716 | |
[1]Permanent difference mainly consisted of the meal and entertainment expenses which is partially non-deductible under PRC income tax law. |
Credit facilities (Details Narr
Credit facilities (Details Narrative) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |||
Interest expense | $ 106,130 | $ 64,658 | $ 68,656 |
Taxes (Details)
Taxes (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |||
Current | $ 1,357,135 | $ 1,119,640 | $ 904,761 |
Deferred | 46,745 | 33,323 | 303,049 |
Provision for income taxes | $ 1,403,880 | $ 1,152,963 | $ 1,207,810 |
Taxes (Details 1)
Taxes (Details 1) | 12 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | ||
Income Tax Disclosure [Abstract] | ||||
China statutory income tax rate | 25% | 25% | 25% | |
Preferential tax rate reduction | (8.80%) | (7.60%) | (10.30%) | |
Change in valuation allowance | 0.70% | 0.50% | 0.70% | |
Permanent difference | [1] | 0.10% | 0.10% | 0.10% |
Effective tax rate | 17% | 18% | 15.50% | |
[1]Permanent difference mainly consisted of the meal and entertainment expenses which is partially non-deductible under PRC income tax law. |
Taxes (Details 2)
Taxes (Details 2) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 |
Income Tax Disclosure [Abstract] | ||
Allowance for doubtful accounts | $ 400,704 | $ 444,857 |
Net operating loss carryforwards | 334,805 | 321,754 |
Valuation allowance | (482,627) | (462,144) |
Deferred tax assets, net | $ 252,882 | $ 304,467 |
Taxes (Details 3)
Taxes (Details 3) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 |
Income Tax Disclosure [Abstract] | ||
VAT taxes payable | $ 775,847 | $ 1,463,890 |
Income taxes payable | 4,633,460 | 3,346,842 |
Other taxes payable | 14,648 | 52,845 |
Totals | $ 5,423,955 | $ 4,863,577 |
Taxes (Details Narrative)
Taxes (Details Narrative) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Operating Loss Carryforwards [Line Items] | |||
Income tax expense | $ 1,403,880 | $ 1,152,963 | $ 1,207,810 |
Effective tax rate | 19.20% | 18% | 15.50% |
Allowance on deferred tax assets | $ 334,805 | $ 321,754 | |
Allowance on deferred tax assets | 400,704 | 444,857 | |
Uncertain tax positions | 0 | 0 | |
P R C Subsidiaries [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | 2,606,744 | 2,387,142 | |
Allowance on deferred tax assets | 207,864 | 198,199 | |
Hong Kong Subsidiaries [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | 769,340 | 748,817 | |
Allowance on deferred tax assets | 126,941 | 123,555 | |
P R C Subsidiaries Other Than Shenzhen C D T [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Allowance on deferred tax assets | $ 147,822 | $ 140,390 |
Concentration of risk (Details
Concentration of risk (Details Narrative) | 12 Months Ended | |||
Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 | Dec. 31, 2023 HKD ($) | |
Concentration Risk [Line Items] | ||||
Credit risk description | The RMB depreciated by 1.7% from December 31, 2022 to December 31, 2023 and depreciated by 9.2% from December 31, 2021 to December 31, 2022. | |||
Purchase [Member] | Customer Concentration Risk [Member] | Vendor 1 [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration of credit risk | 27.30% | 19.70% | 40.70% | |
Purchase [Member] | Customer Concentration Risk [Member] | Vendor 2 [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration of credit risk | 10% | 23.60% | ||
Purchase [Member] | Customer Concentration Risk [Member] | Vendor 3 [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration of credit risk | 11.70% | |||
Purchase [Member] | Customer Concentration Risk [Member] | Vendor 4 [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration of credit risk | 10% | |||
Accounts Payable [Member] | Customer Concentration Risk [Member] | Vendor [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration of credit risk | 10% | |||
Accounts Payable [Member] | Customer Concentration Risk [Member] | One Vendor [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration of credit risk | 12.60% | |||
Accounts Payable [Member] | Customer Concentration Risk [Member] | Two Vendor [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration of credit risk | 10.90% | |||
Customer 1 [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration of credit risk | 23.40% | 48.50% | 48.90% | |
Customer 1 [Member] | Accounts Receivable [Member] | Customer Concentration Risk [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration of credit risk | 13% | 18.20% | ||
Customer 2 [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration of credit risk | 10.20% | 15.20% | 20.80% | |
Customer 2 [Member] | Accounts Receivable [Member] | Customer Concentration Risk [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration of credit risk | 12.30% | 15.10% | ||
Customer 3 [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration of credit risk | 14.60% | |||
Customer 3 [Member] | Accounts Receivable [Member] | Customer Concentration Risk [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration of credit risk | 12.90% | |||
Customer 4 [Member] | Accounts Receivable [Member] | Customer Concentration Risk [Member] | ||||
Concentration Risk [Line Items] | ||||
Concentration of credit risk | 11.20% | |||
Credit Risk [Member] | ||||
Concentration Risk [Line Items] | ||||
Deposited financial institutions | $ 268,102 | $ 140,681 | ||
Deposited insurance amount | 64,000 | $ 500,000 | ||
Credit Risk [Member] | China, Yuan Renminbi | ||||
Concentration Risk [Line Items] | ||||
Deposited insurance amount | 500,000 | |||
Credit Risk [Member] | CHINA | ||||
Concentration Risk [Line Items] | ||||
Deposited insurance amount | 77,000 | |||
Credit Risk [Member] | HONG KONG | ||||
Concentration Risk [Line Items] | ||||
Deposited financial institutions | $ 18,267 | $ 33,407 |
Shareholders_ equity (Details N
Shareholders’ equity (Details Narrative) - USD ($) | 12 Months Ended | ||||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 30, 2020 | Oct. 15, 2019 | |
Number of ordinary shares authorized | 38,000,000 | 50,000,000 | |||
Ordinary shares, par value | $ 0.001 | $ 0.001 | $ 0.001 | ||
Number of additional ordinary shares authorized | 50,000,000 | ||||
Number of shares issued | 23,000,000 | ||||
Repurchased shares | 900,000 | ||||
Cancelled shares | 900,000 | ||||
Reverse stock split | 25.56-for-1 | ||||
Common stock, shares authorized | 20,000,000 | ||||
Common stock, par value | $ 0.0025 | $ 0.0025 | $ 0.0025 | ||
Ordinary shares outstanding | 9,200,000 | ||||
Paid-in-capital | $ 7,888,981 | $ 7,092,665 | |||
Retained earnings for statutory reserves | $ 796,316 | $ 634,911 | $ 700,411 | ||
Hong Kong, Dollars | |||||
Ordinary shares, par value | $ 0.01 |
Leases (Details)
Leases (Details) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 | Jan. 02, 2022 |
Leases | |||
2024 | $ 127,669 | ||
2025 | 40,891 | ||
2026 | 34,950 | ||
2027 | 35,998 | ||
2028 and thereafter | 3,029 | ||
Total undiscounted lease payments | 242,537 | ||
Less imputed interest | (17,724) | ||
Total lease liabilities | 224,813 | $ 201,180 | |
Lease liabilities, current | 118,833 | $ 87,212 | |
Lease liabilities, non-current | $ 105,980 | $ 233,496 |
Leases (Details 1)
Leases (Details 1) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Leases | |||
Operating lease cost | $ 109,184 | $ 98,690 | $ 267,900 |
Short-term lease cost | 105,517 | 193,525 | 0 |
Total | $ 214,701 | $ 292,215 | $ 267,900 |
Leases (Details Narrative)
Leases (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Leases | ||
Initial recognition of operating right of use asset and lease liability | $ 0 | $ 407,446 |
Weighted-average incremental borrowing rate | 5.50% | |
Weighted-average lease term | 2 years 9 months 18 days | 4 years 8 months 12 days |
Commitments and contingencies_2
Commitments and contingencies (Details) | Dec. 31, 2023 USD ($) |
Management [Member] | |
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items] | |
2024 | $ 4,134 |
Enterprise wide disclosure (Det
Enterprise wide disclosure (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Revenue from External Customer [Line Items] | |||
Total revenue | $ 34,209,919 | $ 28,849,362 | $ 23,556,820 |
Total cost of revenues | 22,825,033 | 18,596,207 | 15,062,490 |
Total gross profit | 11,384,886 | 10,253,155 | 8,494,330 |
Sewage Treatment Systems [Member] | |||
Revenue from External Customer [Line Items] | |||
Total revenue | 32,267,593 | 26,552,481 | 20,272,996 |
Total cost of revenues | 21,630,216 | 17,170,669 | 12,816,882 |
Total gross profit | 10,637,377 | 9,381,812 | 7,456,114 |
Sewage Treatment Services And Others [Member] | |||
Revenue from External Customer [Line Items] | |||
Total revenue | 1,942,326 | 2,296,881 | 3,283,824 |
Total cost of revenues | 1,194,817 | 1,425,538 | 2,245,608 |
Total gross profit | $ 747,509 | $ 871,343 | $ 1,038,216 |
Subsequent events (Details Narr
Subsequent events (Details Narrative) - Subsequent Event [Member] - USD ($) | Apr. 22, 2024 | Jan. 10, 2024 |
Subsequent Event [Line Items] | ||
Line of credit | $ 700,000 | |
Loan bears an interest rate | 4.40% | |
Net preoceeds pubic offering | $ 600,000 | |
IPO [Member] | ||
Subsequent Event [Line Items] | ||
Shares issued | 1,500,000 | |
Shares price | $ 4 | |
Net preoceeds pubic offering | $ 4,300,000 |
Condensed financial informati_3
Condensed financial information of the parent company (Details) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
OTHER ASSET | ||||
Total asset | $ 72,791,561 | $ 53,910,727 | ||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||
LIABILITIES | 40,705,318 | 28,350,816 | ||
COMMITMENTS AND CONTINGENCIES | ||||
SHAREHOLDERS’ EQUITY | ||||
Ordinary shares, $0.0025 par value, 20,000,000 shares authorized, and 9,200,000 shares outstanding as of December 31, 2023 and 2022 | 23,000 | 23,000 | ||
Additional paid-in capital | 7,453,265 | 7,453,265 | ||
Statutory reserves | 3,192,855 | 2,396,539 | ||
Retained earnings | 23,242,946 | 16,621,556 | ||
Accumulated other comprehensive loss | (2,009,421) | (1,490,621) | ||
Total shareholders’ equity | 32,086,243 | 25,559,911 | $ 22,392,234 | $ 15,385,778 |
Total liabilities and shareholders’ equity | 72,791,561 | 53,910,727 | ||
Parent Company [Member] | ||||
OTHER ASSET | ||||
Investment in subsidiaries | 31,902,645 | 25,003,739 | ||
Total asset | 31,902,645 | 25,003,739 | ||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||
LIABILITIES | 0 | 0 | ||
COMMITMENTS AND CONTINGENCIES | ||||
SHAREHOLDERS’ EQUITY | ||||
Ordinary shares, $0.0025 par value, 20,000,000 shares authorized, and 9,200,000 shares outstanding as of December 31, 2023 and 2022 | 23,000 | 23,000 | ||
Additional paid-in capital | 7,453,265 | 7,453,265 | ||
Statutory reserves | 3,192,855 | 2,396,539 | ||
Retained earnings | 23,242,946 | 16,621,556 | ||
Accumulated other comprehensive loss | (2,009,421) | (1,490,621) | ||
Total shareholders’ equity | 31,902,645 | 25,003,739 | ||
Total liabilities and shareholders’ equity | $ 31,902,645 | $ 25,003,739 |
Condensed financial informati_4
Condensed financial information of the parent company (Details 1) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Condensed Financial Statements, Captions [Line Items] | |||
NET INCOME | $ 7,024,054 | $ 5,242,789 | $ 6,578,260 |
FOREIGN CURRENCY TRANSLATION ADJUSTMENT | (497,722) | (2,110,311) | 428,196 |
COMPREHENSIVE INCOME | 6,526,332 | 3,132,478 | 7,006,456 |
Parent Company [Member] | |||
Condensed Financial Statements, Captions [Line Items] | |||
EQUITY INCOME OF SUBSIDIARIES | 7,417,705 | 5,782,018 | 6,775,739 |
NET INCOME | 7,417,705 | 5,782,018 | 6,775,739 |
FOREIGN CURRENCY TRANSLATION ADJUSTMENT | (518,799) | (2,050,374) | 347,249 |
COMPREHENSIVE INCOME | $ 6,898,906 | $ 3,731,644 | $ 7,122,988 |
Condensed financial informati_5
Condensed financial information of the parent company (Details 2) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net income | $ 7,024,054 | $ 5,242,789 | $ 6,578,260 |
Adjustments to reconcile net income to cash used in operating activities: | |||
Net cash used in operating activities | (3,132,666) | (4,472,780) | (129,639) |
CHANGES IN CASH | 68,238 | (935,098) | 771,266 |
CASH AND RESTRICTED CASH, BEGINNING OF THE YEAR | 199,864 | 1,134,962 | 363,696 |
CASH AND RESTRICTED CASH, END OF THE YEAR | 268,102 | 199,864 | 1,134,962 |
Parent Company [Member] | |||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net income | 7,417,705 | 5,782,018 | 6,775,739 |
Adjustments to reconcile net income to cash used in operating activities: | |||
Equity income of subsidiaries | (7,417,705) | (5,782,018) | (6,775,739) |
Net cash used in operating activities | 0 | 0 | 0 |
CHANGES IN CASH | 0 | 0 | 0 |
CASH AND RESTRICTED CASH, BEGINNING OF THE YEAR | 0 | 0 | 0 |
CASH AND RESTRICTED CASH, END OF THE YEAR | $ 0 | $ 0 | $ 0 |