RELATED PARTY TRANSACTIONS AND BALANCES

3 Months Ended

Mar. 31, 2015

Related Party Transactions [Abstract]

Related Party Transactions Disclosure [Text Block]

16. RELATED PARTY TRANSACTIONS AND BALANCES

On its foundation, Wuxi KJF was 60% owned by KJF Biotech and 40% owned by 20 individual shareholders with 2% each. On September 10, 2012, Mr. Yazhong Liao, Ms. Zhangmei Zhang and Mr. Huiwen Qu signed a series of share transfer agreements with KJF Biotech and Other Founders. According to these agreements, KJF Biotech and Other Founders of the Company transferred all of their shares to Mr. Yazhong Liao, Ms. Zhangmei Zhang and Mr. Huiwen Qu. Therefore, Mr. Yazhong Liao, Ms. Zhangmei Zhang and Mr. Huiwen Qu owned 60.004%, 27.498% and 12.498% equity interest of Wuxi KJF, respectively. KJF Biotech’s current owners are Mr. Yazhong Liao, Ms. Zhangmei Zhang and Mr. Huiwen Qu. The Company and KJF Biotech share certain officers and employees, who are working roughly half the time for the Company and half the time for KJF Biotech. The salaries and associated expenses of these officers and employees are equally shared by the Company and KJF Biotech. During the three months ended March 31, 2015 and 2014, Wuxi KJF recorded $10,594 and $15,428 expenses for those shared officers and employees in selling and general and administrative expenses, respectively.

During three months ended March 31, 2015, the amount of loans Wuxi KJF made to KJF Biotech was $128,709, and KJF Biotech repaid to Wuxi KJF $221,150. During three months ended March 31, 2014, the amount of loans Wuxi KJF made to KJF Biotech was $69,206, and KJF Biotech repaid to Wuxi KJF $648,611.

The balances of due to owners as of March 31, 2015 and December 31, 2014 were $784,874 and $283,054, respectively, and represented payment made by KJF Biotech for operation purposes on behalf of Wuxi Club and non-interest bearing loan from Mr. Yazhong Liao, Ms. Zhangmei Zhang, Xiuxia Ji, Yimin Gu and Mr. Huiwen Qu for daily operations.

The Company’s trademark “Kangjiafu” was registered by KJF Biotech and the Company licensed it from KJF Biotech at no cost. The license agreement expires in November 2018.