UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-QSB
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2005
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the transition period from ...........to...............
Commission File Number 000-12561
Deli Solar (USA), Inc.
(Exact name of small business issuer as specified in its charter)
Nevada | 95-3819300 | |
(State or other jurisdiction | (I.R.S. Employer | |
of incorporation or organization) | Identification No.) |
558 Lime Rock Road, Lime Rock, Connecticut 06039
(Address of Principal Executive Offices)
(860) 435-7000
(Issuer's telephone number)
Former Name: Meditech Pharmaceuticals, Inc.
Former Fiscal Year: May 31
(Former name, former address and former fiscal year, if changed since last report)
Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes x Noo
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes oNo x
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court.
Yeso Noo
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: there were 6,145,290 shares outstanding as of November 14, 2005.
Transitional Small Business Disclosure Format (check one) Yes o No x
1
Deli Solar (USA), Inc.
TABLE OF CONTENTS
PART I Financial Information | Page | |
Item 1. Financial Statements & Notes | 3 | |
Item 2. Management’s Discussion and Analysis or Plan of Operation | 9 | |
Item 3. Controls and Procedures | 13 | |
PART II Other Information | ||
Items 6. Exhibits and Reports on Form 8-K | 14 | |
Signatures Page | 15 | |
Exhibits/Certifications |
2
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
DELI SOLAR (USA), INC. Consolidated Balance Sheet (unaudited)
Assets | September 30, 2005 | |||
Current assets | ||||
Cash and cash equivalents | $ | 4,955,878 | ||
Trade accounts receivable | 708,578 | |||
Allowances for doubtful accounts | (88,600 | ) | ||
Net trade accounts receivable | 619,978 | |||
Prepaid expenses | 625,101 | |||
Related party receivable | 390,337 | |||
Inventories | 538,502 | |||
Total current assets | 7,129,796 | |||
Property, plant and equipment | ||||
Buildings | 1,932,689 | |||
Machinery and equipment | 43,217 | |||
Vehicles | 70,451 | |||
Computer equipment | 11,291 | |||
Office equipment | 4,133 | |||
Construction in progress | 1,234,670 | |||
Total | 3,296,451 | |||
Accumulated depreciation | (159,244 | ) | ||
Net property, plant and equipment | 3,137,207 | |||
Other receivables | 57,106 | |||
Prepaid land lease | 68,591 | |||
Total other assets | 125,697 | |||
Total assets | $ | 10,392,700 |
See Notes to Unaudited Consolidated Financial Statements
3
DELI SOLAR (USA), INC. Consolidated Balance Sheet (unaudited) (Continued)
Liabilities and stockholders' equity | September 30, 2005 | |||
Current liabilities | ||||
Trade accounts payable | $ | 87,480 | ||
Other payables | 76,423 | |||
Accrued expenses | 9,076 | |||
Deposits | 9,810 | |||
Short-term notes payable | 49,432 | |||
Total current liabilities | 232,221 | |||
Stockholders' equity | ||||
Preferred Stock: par value $0.001; 25,000,000 authorised, no shares issued and outstanding | - | |||
Common stock: par value $0.001; 66,666,667 shares authorized, 6,145,277 shares issued and outstanding | 6,145 | |||
Additional paid in capital | 5,474,541 | |||
Retained earnings | 4,560,612 | |||
Accumulated other comprehensive income | 119,181 | |||
Total stockholders' equity | 10,160,479 | |||
Total Liabilities and stockholders' equity | $ | 10,392,700 |
See Notes to Unaudited Consolidated Financial Statements
4
DELI SOLAR (USA), INC. Consolidated Statements of Operations and Comprehensive Income (unaudited)
Nine months ended Sep 30, 2005 | Nine months ended Sep 30, 2004 | Three months ended Sep 30, 2005 | Three months ended Sep 30, 2004 | ||||||||||
Sales revenues | $ | 10,664,972 | $ | 6,441,642 | $ | 4,840,034 | $ | 2,380,112 | |||||
Cost of goods sold | 8,155,095 | 4,529,021 | 3,703,202 | 1,652,232 | |||||||||
Gross profit | 2,509,877 | 1,912,621 | 1,136,832 | 727,880 | |||||||||
Operating expenses | |||||||||||||
Advertising | 442,675 | 179,440 | 178,100 | 97,001 | |||||||||
Other selling expenses | 158,637 | 75,309 | 80,226 | 36,072 | |||||||||
Salaries and benefits | 138,987 | 122,072 | 59,165 | 46,622 | |||||||||
Depreciation | 31,755 | 21,773 | 16,447 | 7,367 | |||||||||
Other general and administrative | 669,814 | 80,317 | 137,388 | 15,464 | |||||||||
Total operating expenses | 1,441,868 | 478,911 | 471,326 | 202,526 | |||||||||
Net operating income | 1,068,009 | 1,433,710 | 665,506 | 525,354 | |||||||||
Other income (expense) | |||||||||||||
Interest expense | (17,857 | ) | (1,868 | ) | (4,144 | ) | (1,868 | ) | |||||
Other | 61,516 | 20,285 | 61,516 | 27,696 | |||||||||
Total other income (expense) | 43,659 | 18,417 | 57,372 | 25,828 | |||||||||
Net income before taxes | 1,111,668 | 1,452,127 | 722,878 | 551,182 | |||||||||
Taxes | - | - | - | - | |||||||||
Net income | $ | 1,111,668 | $ | 1,452,127 | $ | 722,878 | $ | 551,182 | |||||
Foreign currency translation | |||||||||||||
adjustment | 119,181 | - | 119,181 | - | |||||||||
Comprehensive income | $ | 1,230,849 | $ | 1,452,127 | $ | 842,059 | $ | 551,182 | |||||
Basic earnings per share | $ | 0.20 | $ | 0.33 | $ | 0.12 | $ | 0.12 | |||||
Denominator for basic EPS | 5,580,126 | 4,430,987 | 6,145,277 | 4,430,987 | |||||||||
�� | |||||||||||||
Fully diluted earnings per share | $ | 0.17 | $ | 0.33 | $ | 0.09 | $ | 0.12 | |||||
Denominator for diluted EPS | 6,614,352 | 4,430,987 | 7,688,138 | 4,430,987 |
See Notes to Unaudited Consolidated Financial Statements
5
DELI SOLAR (USA), INC. Consolidated Statements of Cash Flows (unaudited)
Consolidated Statements of Cash Flow | |||||||
Nine months ended Sep 30, 2005 | Nine months ended Sep 30, 2004 | ||||||
Cash flow from operating activities: | |||||||
Net earnings | $ | 1,111,668 | 1,452,127 | ||||
Adjustments to reconcile net income to net cash provided by (used in) operations: | |||||||
Depreciation and amortization | 35,148 | 21,773 | |||||
Changes in operating liabilities and assets: | |||||||
Trade accounts receivable | -492,523 | -88,656 | |||||
Prepaid expense | -272,057 | -615,822 | |||||
Inventories | -239,504 | 210,178 | |||||
Other receivables | -38,990 | - | |||||
Prepaid land lease | -505 | 1,113 | |||||
Trade accounts payable | 39,509 | 8,629 | |||||
Other payables | -5,323 | 9,895 | |||||
Accrued expenses | -203,158 | -25,761 | |||||
Deposits | -2,638 | 6,947 | |||||
Net cash provided by (used in)operations | -68,373 | 980,423 | |||||
Cash Flows from investing activities; | |||||||
Purchases of property,plant&equipment | -627,802 | -1,067,735 | |||||
Net cash used in investing activities | -627,802 | -1,067,735 | |||||
Cash Flows from financing activities; | |||||||
Capital contribution received from shareholders | 5,274,889 | - | |||||
Related party receivables | 371,953 | -54,585 | |||||
Payables to related party | -821,256 | - | |||||
Proceeds from short-term notes payable | -483,781 | 221,015 | |||||
Net cash provided by financing activities | 4,341,805 | 166,430 | |||||
Effect of exchange rate changes on cash and cash equivalents | 119,181 | - | |||||
Increase (decrease) in cash and cash equivalents | 3,764,811 | 79,118 | |||||
Cash and cash equivalents,beginning of period | 1,191,067 | 1,109,110 | |||||
Cash and cash equivalents,end of period | $ | 4,955,878 | $ | 1,188,228 | |||
Supplement disclosures of cash flow information: | |||||||
Interest paid in cash | 17,857 | 1,868 | |||||
Taxes paid in Cash | 6,390 | 5,080 | |||||
See Notes to Unaudited Consolidated Financial Statements
6
Notes to Unaudited Consolidated Financial Statements of September 30, 2005
The accompanying interim unaudited consolidated financial statements include the accounts of Deli Solar (USA), Inc. and its subsidiaries (hereafter referred to as, the “Company”). All intercompany accounts and transactions have been eliminated in the consolidation of the financial statements.
These financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial statements and with the instructions to Form 10-QSB. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for annual financial statements. In the opinion of management, such interim statements reflect all adjustments (consisting of normal recurring accruals) necessary to present fairly the financial position and the results of operations and cash flows for the interim periods presented. The operating results for the three months ended September 30, 2005 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2005. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company’s Form 10-KSB for the year ended May 31, 2005.
Note 1: Summary of Significant Accounting Policies
a) | Revenue recognition |
Revenue from the sale of goods is recognized on the transfer of risks and rewards of ownership, which generally coincides with the time when the goods are delivered to customers and the title has passed. Other income includes compensation received from the State Bureau as incentive to relocate from its previous location, profit from the sales of raw materials to third parties and write-offs of long -outstanding trade payables.
b) | Taxes |
Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates which are expected to apply to taxable income in the years in which those temporary differences are expected to reverse. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the Statement of Operations for the period that includes the enactment date at such rates. A valuation allowance is provided for deferred tax assets if it is more likely than not these items will expire before the Company is able to realize their benefits, or that their future deductibility is uncertain.
Currently, the Company has recorded no income taxes and no deferred taxes because it pays a fixed tax as assessed, and annually adjusted, by the State Administration of Taxation of Bazhou and Bazhou Local Taxation Bureau. Therefore, there is no income tax, per se, and there are no temporary differences in assets or liabilities.
c) | Foreign currencies: |
The accompanying financial statements are presented in United States (US) dollars. The functional currency is the Renminbi (RMB). The financial statements are translated into US dollars from RMB at an exchange rate of 8.09 RMB to one U.S. Dollar for assets and liabilities, and weighted average exchange rates for revenues and expenses. Capital accounts are translated at their historical exchange rates when the capital transactions occurred. On July 21, 2005, China changed its foreign currency exchange policy from a fixed RMB/USD exchange rate into a flexible rate under the control of China’s government. We use the Closing Rate Method in currency translation of the financial statements of Deli PRC.
7
d) | Use of estimates |
The preparation of financial statements in accordance with generally accepted accounting principles in the United States of America requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
e) | Cash |
Cash represents cash on hand and deposits held in financial institutions. For the purposes of the cash flow statements, cash consists of cash on hand and deposits held on call with the banks.
f) | Accounts receivable |
Provision is made against accounts receivable to the extent that they are considered to be doubtful. Accounts receivable on the balance sheet are stated net of such provision. As of September 30, 2005, provision for doubtful accounts totaled $88,600.
g) | Inventories |
Inventories consist of raw materials, consumables and goods held for resale and are stated at the lower of cost or market value. Cost is calculated using the first in first out method and includes any overhead costs incurred in bringing the inventories to their present location and condition.
h) | Fixed assets |
Fixed assets are stated at cost less accumulated depreciation. The cost of an asset is comprised of its purchase price and any directly attributable costs of bringing the asset to its present working condition and location for its intended use. Expenditures incurred after assets have been put into operation, such as repairs and maintenance and overhaul costs, are normally charged to the statement of operations in the period in which they are incurred. In situations where it can be clearly demonstrated that the expenditure has resulted in an increase in the future economic benefits expected to be obtained from the use of the asset, the expenditure is capitalized as an additional cost of the asset.
When assets are sold or retired, their cost and accumulated depreciation are eliminated from the financial statements and any gain or loss resulting from their disposal is included in the statement of operations. Where the recoverable amount of an asset has declined below its carrying amount, the carrying amount is reduced to reflect the decline in value. Expected future cash flows have been discounted in determining the recoverable amount. There were no fixed assets impairments during the six months ended September 30, 2005.
8
i) | Construction-in-progress |
All facilities purchased for installation, self-made or subcontracted are accounted for under construction-in-progress. Construction-in-progress is recorded at acquisition cost, including cost of facilities, installation expenses and the interest capitalized during the course of construction for the purpose of financing the project. Upon completion and readiness for use of the project, the cost of construction-in-progress is to be transferred to fixed assets.
j) | Related party transaction |
Transactions with related parties can be substantiated by the Company as ‘arms length’ transactions. Accounts receivable from related parties at September 30, 2005, was $390,337.
Item 2. Management’s Discussion and Analysis or Plan of Operation.
OVERVIEW
Deli Solar (USA), Inc. (“we,”“us” or the Company) was formerly known as Meditech Pharmaceuticals, Inc., until March 31, 2005, when we completed a strategic reorganization with Deli Solar Holding Ltd., a corporation organized in the British Virgin Islands under the International Business Companies Act ("Deli Solar (BVI)"). Deli Solar (BVI) is a holding company for Bazhou Deli Solar Energy Heating Co. Ltd, a corporation duly organized and registered with the Bazhou Bureau for Industry and Commerce in Hebei Province, People's Republic of China (“Deli Solar (PRC)”).
Deli Solar (PRC) was founded in 1997 and its principal products are solar hot water heaters and space heating and cooking products including coal-fired residential boilers. It also sells accessories, component parts, and provides after-sales maintenance and repair services. We are in the process of negotiating an acquisition of another PRC company.
On November 11, 2005, we entered into an agreement in principle with Beijing Yuxin Yangguang Solar Energy Industrial Co.,Ltd. (“Beijing Yuxin”), pursuant to which, we agreed to acquire 60% equity of Beijing Yuxin. Beijing Yuxin is a PRC enterprise which manufactures solar hot water heaters. We estimate the total value of Beijing Yuxin at $3million. We anticipate that this acquisition will increase our production capacity and expand our market coverage. Negotiations on definitive terms are pending.
Meditech had a fiscal year ending May 31. On August 2, 2005, our Board of Directors resolved to change our fiscal year end to December 31. Therefore, the financial statements in this quarterly report reflect the operating results of Deli Solar (PRC) for the nine months ended September 30, 2005 and 2004, respectively.
RESULTS OF OPERATIONS
Sales and gross profit
9
Revenue for the three months ended September 30, 2005 was $4,840,034 as compared to $2,380,112 for the same period last year, an increase of approximately 103%. Revenue for the nine months ended September 30, 2005 was $10,664,972 as compared to $6,441,642 for the same period last year, an increase of approximately 66%. The increase in revenue was primarily attributable to continued efforts in building our distributing network and increased sales resulting from continued investment in our brand advertisement.
Gross profit for the three months ended September 30, 2005 was $1,136,832, an increase of $408,952, or approximately 56%, as compared to $727,880 for the three months ended September 30, 2004.
Cost of Sales
Cost of sales was $3,703,202 for the three months ended September 30, 2005 and was $8,155,095 for nine months ended September 30, 2005. Cost of the sales was of 77% of revenue for the three months, compared to 70% of revenue for the same period in 2004. Cost of the sales was 76% of revenue for the nine months ended September 30, 2005, compared to 70% of revenue for the same period in 2004. The ratio of cost of sales to revenue increased, due to decreases in the selling prices of our products from fierce market competition, the increased purchasing price of raw materials and the increased amount of OEM products.
Operating Expenses
Operating expenses for the three months ended September 30, 2005 was $471,326, as compared to $205,526 for the same period in 2004, an increase of $268,800 or approximately 130%. The increased operating expenses primarily went to advertising fees and other selling expenses and other general administrative expenses.
The advertising expenses for the three months ended September 30 was $178,100, as compared to $97,001 for the same period last year. The increase in advertising expense was a result of additional advertising campaigns to increase product awareness, branding and sales.
Other selling expenses for the three months ended September 30, 2005 was $80,226 as compared to $36,072 for the same period last year, an increase of $44,154, or approximately 122%. Other selling expenses consisted primarily of transportation expenses, agency administration expenses, after sales services, such as expenses for installation, repairs and replacements. The increase in other selling expenses was primarily due to the increase of sales volume and addition of new distributors.
Other general and administrative expenses were $137,388, as compared to $15,464 for the same period last year. The increase of 788% in the other general and administrative expenses was primarily from compensation of newly hired senior management personnel and directors and from professional fees relating to maintaining our standing as a reporting company.
Income from Operations
Income from operations for the three months ended September 30, 2005 was $665,506, as compared to $525,354 for the three months ended September 30, 2004. Income from operations for the nine months ended September 30, 2005 was $1,068,009, approximately 74% of $1,433,710, the income from operations for the nine months ended September 30, 2004. The decreased operation income was due to the increased operating expenses in 2005 as mentioned above.
10
Income Taxes
The Company did not carry on any business or maintain any branch office in the United States during the nine months ended September 30, 2005 or the nine months ended September 30, 2004. Therefore, no provision for U.S. Federal income taxes or tax benefits on the undistributed earnings and/or losses of the Company has been made.
Currently, the Company has recorded no income taxes and no deferred taxes because it pays a fixed tax as assessed, and annually adjusted, by the State Administration of Taxation of Bazhou and Bazhou Local Taxation Bureau, which is recorded in our financial statements under general and administrative expenses.
In addition, pursuant to the relevant laws and regulations in the PRC, Deli Solar (PRC), as a wholly foreign owned enterprise ("WFOE") in the PRC, is entitled to an exemption from the PRC enterprise income tax for two years commencing from its first profitable year, after loss carry-forwards from the previous five years have been recovered. Because Deli Solar (PRC) was transformed into a WFOE in March 2005, it is currently in the two-year 100% exemption from income taxes until March 2007, it is entitled to 50% relief from the PRC enterprise income tax for the following years of its operation from 2007 until 2010. Currently Deli Solar PRC is applying to the State Administration of Taxation of Bazhou and Bazhou Local Taxation Bureau for its WFOE tax status.
Net Income
Net income decreased to approximately $1,111,668 in the nine months ended September 30, 2005, or approximately 23%, from $1,452,127 in the nine months ended September 30, 2004, primarily due to increased expenses in marketing, advertising and administrative matters including maintaining the Company as a US public reporting company.
Liquidity and Capital Resources
We raised a total of $6 million from a private placement transaction concurrent with the Reverse Merger in March 2005. We are using these monies to increase our advertising and marketing, and to increase our production capacity and facilities, as well as to merge and acquire prospective companies.
Net cash used by operating activities for the nine months ended September 30, 2005 was $68,373, as compared to $980,423, net cash provided by operating activities for the nine months ended September 30, 2004. The decrease in net cash provided by operating activities in the first nine months of 2005 was primarily a result of additional expenses associated with the reasons as listed in the analysis of the above Selling, General and Administrative Expenses section.
11
Accounts Receivable
During the nine months ended September 30, 2005, accounts receivable increased from $216,000 to $708,578, primarily due to increased sales.
Inventory
Inventories as of September 30, 2005 increased to $538,502 from $298,998 at December 31, 2004 to accommodate increasing sales and demand for our products.
Accounts Payable
Trade accounts payable, including trade accounts payable, related party payable and other payable, increased from $129,717 as of December 31, 2004 to $163,903 as of September 30, 2005.
Short-term notes payable
During the nine months ended September 30, 2005, short-term notes payable decreased from $533,213 to $49,432 primarily due to the repayment of our loans with three non-related parties.
Cash
Cash and cash equivalents increased from $1,191,067 at December 31, 2004 to $4,955,878 at September 30, 2005, primarily as a result of a private placement in March, 2005 which raised $6,000,015.
In the foreseeable future, capital investment could decrease our working capital further with any significant obligation resulting from acquisition, significant expansion of production capacity, and new product development.
Critical Accounting Policies
Management's discussion and analysis of its financial condition and results of operations are based upon the Company's consolidated financial statements, which have been prepared in accordance with United States generally accepted accounting principles. The Company's financial statements reflect the selection and application of accounting policies which require management to make significant estimates and judgments. See note 3 to the Company's consolidated financial statements, "Summary of Significant Accounting Policies". Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions. The Company believes that the following reflect the more critical accounting policies that currently affect the Company's financial condition and results of operations:
12
Revenue recognition
Product sales are recognized when the products are delivered to and inspected by customers and title has passed. The Company offers a limited three-year warranty program on its products. Under this warranty program, repair and replacement of defective component parts are free of any charge during the first year following the purchase. In the second and third year, customers must pay for the purchase of the replacement parts, but not for repair services. The Company also allows its sales agents and distributors to return any defective product for exchange or repair.
Sales revenue represents the invoiced value of goods, net of a VAT. All of the Company's products that are sold in the PRC are subject to a Chinese value-added tax at a rate of 17% of the gross sales price. This VAT may be offset by VAT paid by the Company on raw materials and other materials included in the cost of producing its finished products.
Property, Plant and Equipment
Building, plant and equipment are recorded at cost less accumulated depreciation and amortization. Depreciation and amortization are recorded utilizing the straight-line method over the estimated original useful lives of the assets. Amortization of leasehold improvements is calculated on a straight-line basis over the life of the asset or the term of the lease, whichever is shorter. Major renewals and betterments are capitalized and depreciated; maintenance and repairs that do not extend the life of the respective assets are charged to expense as incurred. Upon disposal of assets, the cost and related accumulated depreciation are removed from the accounts and any gain or loss is included in income. Depreciation related to property and equipment used in production is reported in cost of sales.
Long-term assets of the Company are reviewed annually as to whether their carrying value has become impaired. The Company considers assets to be impaired if the carrying value exceeds the future projected cash flows from related operations. The Company also re-evaluates the periods of amortization to determine whether subsequent events and circumstances warrant revised estimates of useful lives. As of September 30, 2005, the Company expects these assets to be fully recoverable.
Bad debts
The Company's business operations are conducted in the People's Republic of China. The Company extends unsecured credit to its relatively large customers with good credit history. Management reviews its accounts receivable on a regular basis to determine if the bad debt allowance is adequate at each year-end. The allowances for doubtful accounts were $88,600 as of September 30, 2005 and December 31, 2004.
Item 3. Controls and Procedures
We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Commission's rules and forms, and that such information is accumulated and communicated to our management to allow timely decisions regarding required disclosure. Management necessarily applied its judgment in assessing the costs and benefits of such controls and procedures, which, by their nature, can provide only reasonable assurance regarding management's control objectives.
13
At the conclusion of the period ended September 30, 2005 we carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based upon that evaluation, Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective in alerting them in a timely manner to information relating to the Company required to be disclosed in this report.
During the period covered by this report, there have been no significant changes in our internal controls over financial reporting that occurred that have materially affected, or are reasonably likely to materially affect our internal controls over financial reporting.
There have been no significant changes in our internal controls or in other factors that could significantly affect the internal controls subsequent to the date of the evaluation in connection with the preparation of this quarterly report on Form 10-QSB.
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
Exhibits
21.1 | List of Subsidiaries. |
31.1 | Certification of Chief Executive Officer pursuant to Rules 13a-14(a) as adopted, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
31.2 | Certification of the Chief Financial Officer pursuant to Rules 13a-14(a) as adopted, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
32.1 | Certifications of the Chief Executive Officer and the Chief Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
14
SIGNATURES
In accordance with the requirements of the Securities Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Deli Solar (USA), Inc. (Registrant) | ||
| | |
Date: November 14, 2005 | By: | /s/ Deli Du |
Deli Du | ||
CEO | ||
Date: November 14, 2005 | By: | /s/ Jianmin Li |
Jianmin Li | ||
CFO |
15