| SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Use
of estimates The
preparation of the condensed consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated
financial statements and the reported amounts of revenues and expenses during the reporting periods. Management makes these estimates
using the best information available at the time the estimates are made; however actual results could differ materially from those estimates. Cash
and Cash Equivalents Cash
and cash equivalents are carried at cost and represent cash on hand, demand deposits placed with banks or other financial institutions
and all highly liquid investments with an original maturity of three months or less as of the purchase date of such investments. Under
the PRC Foreign Exchange Control Regulations and Administration of Settlement, Sales and Payment of Foreign Exchange Regulations, the
Company is permitted to exchange Chinese Renminbi for foreign currencies through banks that are authorized to conduct foreign exchange
business. Prepayment,
Deposits and Other Receivables Prepayments
and deposits are mainly cash deposited or advance payments made to third parties for future purchases or future services such as rent
or other general expenses. This amount is refundable and bears no interest. The Company will recognize an allowance account for doubtful
accounts to the extent it is probable that a portion or all of a particular account will not be collected. Management reviews its prepayments
and deposits on a regular basis to determine if the allowance is adequate and adjusts the allowance when necessary. The Company’s
management continues to evaluate the reasonableness of the allowance policy and update it if necessary. No Lease The
Company adopted the ASU No. 2016-02, on October 15, 2019 (date of inception). The Company leases office space for fixed periods with
pre-emptive extension options. The Company recognizes lease payments for its short-term lease on a straight-line basis over the lease
term. As
of March 31, 2024, the Company has one In
determining the present value of the unpaid lease payments, ASC 842 requires a lessee to discount its unpaid lease payments using the
interest rate implicit in the lease or, if that rate cannot be readily determined, its incremental borrowing rate. As most of the Company
leases do not provide an implicit rate, the Company uses its incremental borrowing rate as the discount rate for the lease. The Company
adopted 4.75% as its incremental borrowing rate which is estimated to approximate the interest rate on a collateralized basis with similar
terms and payments. Revenue
Recognition The
Company generates two streams of revenue. The
first stream of revenue is generated through sale of goods, primarily Bio-Carbon-Based-Fertilizer (“BCBF”). Revenue is recognized
when a customer obtains control of promised goods or services and is recognized in an amount that reflects the consideration that the
Company expects to receive in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount,
timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amount of revenue that is recorded reflects
the consideration that the Company expects to receive in exchange for those goods and services. The Company applies the following five-step
model in order to determine this amount: (i)
identification of the promised goods and services in the contract; (ii)
determination of whether the promised goods and services are performance obligations, including whether they are distinct in the context
of the contract; (iii)
measurement of the transaction price, including the constraint on variable consideration; (iv)
allocation of the transaction price to the performance obligations; and (v)
recognition of revenue when (or as) the Company satisfies each performance obligation. The
Company adopted ASU 2014-09, Revenue from Contracts with Customers (Topic 606). Under Topic 606, the Company records revenue when persuasive
evidence of an arrangement exists, delivery has occurred, the fee is fixed or determinable and collectability is probable. The Company
records revenue from the sale of product upon shipment or delivery of the products to the customer. While
another revenue stream is our online retailing business. In online retailing business we have differentiate into two distinct revenue
streams: sales revenue with inventory risk and sales revenue without inventory risk. Initially, the Company act as an agent in transactions,
meaning we place orders with suppliers upon receiving orders from customers. The suppliers will then directly send the goods to the customer
based on our order info. A reporting entity assumes the role of agent in a transaction and arranges for the other party to provide the
specified goods or service. Consequently, product sales revenue is recorded net of cost of sales, as we act as an agent and do not bear
inventory risk. During
the last quarter of 2023, we transitioned to purchasing stock from several suppliers and outsource the inventory warehouse to few suppliers
and we are liable for the inventory risk hence we are principal in this extent. Similar to previous operations, contracts are formed
when customers place orders in the app, and the performance obligation remains unchanged. Revenue recognition continues to be based on
the point in time when customers assume control and legal ownership of the purchased products, without deducting any associated costs,
as this reflects the normal transactional relationship between seller and buyer. We recognize revenue when customers take control and
legal ownership of the purchased products. From
the quarter four of 2023 onwards, the company will continue operate as sales income from BCBF and online retailing business with and
without inventory risk. As such, revenue derived from online retailing business is being recognized on net basis, i.e. gross revenue
received from customer deduct the cost of purchase to supplier. Besides,
adopting ASC 606-10-55-42, we give an option to customers, which they will be received of cash back of 44% from their purchased amount
in the online platform. Hence, 44% of cash back is a material right, so we will net off the cash back portion with the revenue instead
of recognize the whole purchased amount as revenue. Deferred
revenue The
Company’s accounting policy related to deferred revenue is to recognize revenue for performance obligations that have not yet been
fulfilled. As of March 31, 2024 and 2023, the Company recognized amounts of $ 3,208 14,782 Shipping,
Storage and Handling costs Costs
for shipping, storage and handling activities, including those activities that occur subsequent to transfer of control to the customer,
are recorded as selling and distribution expense and are expensed as incurred. The Company accrues costs for shipping, storage and handling
activities that occur after control of the promised good has transferred to the customer. Advertising
costs The
Company’s accounting policy related to advertising costs for annual reporting purposes is to expense costs incurred in marketing
events for example event venue fees, emcee fees and others, as of the first date the advertisements take place. All marketing expenditures
are expensed in the annual period in which the expenditure is incurred. For the three months ended March 31, 2024 and 2023, the Company
did not incurred expenses for advertising costs. Earnings
Per Share The
Company reports earnings per share in accordance with ASC 260 “Earnings Per Share”, which requires presentation of basic
and diluted earnings per share in conjunction with the disclosure of the methodology used in computing such earnings per share. Basic
earnings per share excludes dilution and is computed by dividing income available to common stockholders by the weighted average common
shares outstanding during the period. Diluted earnings per share takes into account the potential dilution that could occur if securities
or other contracts to issue common stock were exercised and converted into common stock. Further, if the number of common shares outstanding
increases as a result of a stock dividend or stock split or decreases as a result of a reverse stock split, the computations of a basic
and diluted earnings per share shall be adjusted retroactively for all periods presented to reflect that change in capital structure. The
Company’s basic earnings per share is computed by dividing the net income available to holders by the weighted average number of
the Company’s ordinary shares outstanding. Diluted earnings per share reflects the amount of net income available to each ordinary
share outstanding during the period plus the number of additional shares that would have been outstanding if potentially dilutive securities
had been issued. Inventories Inventories
consist of finished goods and are stated at the lower of cost or net realizable value using the first-in first-out method. Net realizable
value is the estimated selling price in the ordinary course of business, less estimated costs of completion and the estimated costs necessary
to make the sale. The Company reviews its inventories regularly for possible obsolete goods and establishes reserves when determined
necessary. During
the last quarter of 2023, we transitioned to purchasing stock from several suppliers and outsource the inventory warehouse to few suppliers
and we are liable for the inventory risk hence we are principal in this extent. Our inventory is stored and managed at the facilities
of third-party logistics providers. These arrangements involve contractual agreements outlining the terms of storage, handling, and distribution
of our inventory. Besides, the third-party logistics providers are responsible for maintaining the quality and condition of the inventory
in accordance with our specifications. Each
third-party logistics provider uses its own inventory management system to track the movement and availability of our products. They
will send us a copy of the movement and balance of inventory at the end of the month, which we then compare with the inventory movement
worksheet maintained by our company. This allows us to identify any inventory discrepancies promptly. The third-party logistics providers
facilitate the distribution of our inventory to our customers and fulfillment centers as per our instructions. Additionally, the logistics
providers are responsible for our inventory in any aspect of damaged goods due to their responsibility, for example, stolen inventory,
damaged goods due to warehouse conditions, and other factors. Related
parties Parties,
which can be a corporation or individual, are considered to be related if the Company has the ability, directly or indirectly, to control
the other party or exercise significant influence over the other party in making financial and operating decisions. Companies are also
considered to be related if they are subject to common control or common significant influence. Income
Taxes The
Company accounts for income taxes using the asset and liability method prescribed by ASC 740 “Income Taxes”. Under this method,
deferred tax assets and liabilities are determined based on the difference between the financial reporting and tax bases of assets and
liabilities using enacted tax rates that will be in effect in the years in which the differences are expected to reverse. The Company
records a valuation allowance to offset deferred tax assets if based on the weight of available evidence, it is more-likely-than-not
that some portion, or all, of the deferred tax assets will not be realized. The effect on deferred taxes of a change in tax rates is
recognized as income or loss in the period that includes the enactment date. Foreign
Currency Translation Transactions
denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing
at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated
into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded
in the statements of operations. The
reporting currency of the Company is United States Dollars (“US$”). The Company’s subsidiary in Seychelles, Hong Kong
and PRC have functional currencies in United States Dollars (“US$”), Hong Kong Dollars (“HK$”) and Chinese Renminbi
(“CNY¥”) respectively. In
general, for consolidation purposes, assets and liabilities of its subsidiaries whose functional currency is not the US$ are translated
into US$, in accordance with ASC Topic 830-30, “Translation of Financial Statement”, using the exchange rate on the balance
sheet date. Revenues and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation
of financial statements of foreign subsidiaries are recorded as a separate component of accumulated other comprehensive income within
the statement of stockholders’ equity. The
shareholders’ equity accounts were stated at their historical rate. Cash flows are also translated at average translation rates
for the periods, therefore, amounts reported on the statement of cash flows will not necessarily agree with changes in the corresponding
balances on the consolidated balance sheets. Translation
of amounts from the local currencies of the Company into US$ has been made at the following exchange rates for the respective periods: SCHEDULE OF FOREIGN CURRENCIES TRANSLATION
For
the three March
31, 2024 For
the three March
31, 2023
Period-end HK$ : US$1 exchange
rate 7.82 7.75
Period-end CNY¥ : US$1 exchange rate 7.22 6.87
Period-average HK$ : US$1 exchange rate 7.82 7.75
Period-average CNY¥ : US$1 exchange
rate 7.16 6.85 Fair
Value Measurement Accounting
Standards Codification (“ASC”) 820 “Fair Value Measurements and Disclosures”, which defines fair value, establishes
a framework for measuring fair value and expands disclosures about fair value measurements. The statement clarifies that the exchange
price is the price in an orderly transaction between market participants to sell the asset or transfer the liability in the market in
which the reporting entity would transact for the asset or liability, that is, the principal or most advantageous market for the asset
or liability. It also emphasizes that fair value is a market-based measurement, not an entity-specific measurement, and that market participant
assumptions include assumptions about risk and effect of a restriction on the sale or use of an asset. This
ASC establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy
gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and
the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described below: Level
1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; Level
2: Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the
full term of the asset or liability; and Level
3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported
by little or no market activity). Recently
issued accounting pronouncements In
November 2023, the FASB issued ASU 2023-07, Improvement to Reportable Segment Disclosures (Topic 280). Asu 2023-07 aims to improve segment
disclosures through enhanced disclosures about significant segment expenses. The standard requires all public entities, including those
public entities that have a single reportable segment, shall disclose all of the following for each period for which an income statement
is presented. However, reconciliations of balance sheet amounts for reportable segments to consolidated balance sheet amounts are required
only for each year for which a balance sheet is presented. This standard will be effective for the Company in fiscal year of 2024. The
Company is currently evaluating the impact of the additional disclosure requirements on the Company’s condensed consolidated financial
statements. The
Company reviews new accounting standards as issued. Management has not identified any other new standards that it believes will have
a significant impact on the Company’s unaudited condensed consolidated financial statements. Economic
and political risks Substantially
all the Company’s services are conducted in the People’s Republic of China (“PRC”), of which operations in the
PRC are subject to special considerations and significant risks not typically associated with companies in rest of the world. These include
risks associated with, among others, the political, economic and legal environment and foreign currency exchange. The Company’s
results may be adversely affected by changes in the political conditions in the PRC, and by changes in governmental policies with respect
to laws and regulations, anti-inflationary measures, currency conversion, remittances abroad, and rates and methods of taxation. |
