10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2020 or

[  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________to _________

001-32522

Commission file number

China Foods Holdings Ltd.

(Exact name of registrant as specified in its charter)

Delaware	84-1735478
State or other jurisdiction of incorporation or organization	(I.R.S. Employer Identification No.)

Everbright Center, Suite 3102 108 Gloucester Road Wanchai, Hong Kong	0000
(Address of principal executive offices)	(Zip Code)

(852) 3618-8608

Registrant’s telephone number, including area code

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 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] No [  ]

Indicate by check mark whether the registrant has submitted electronically on its corporate Web site, if any, every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes [X] No [  ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	[  ]	Accelerated filer	[  ]
Non-accelerated filer	[  ]	Smaller reporting company	[X]
		Emerging growth company	[  ]

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [  ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [  ] No [X]

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.

Class	Outstanding August 14, 2020
Common Stock, with $0.0001 par value	5,252,309 shares

Table of Contents

		Page No.
	PART I – FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited) Notes to Financial Statements	3
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	11
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	17
Item 4.	Controls and Procedures	17
	PART II – OTHER INFORMATION
Item 1.	Legal Proceedings	18
Item 1A.	Risk Factors	18
Item 2.	Unregistered Sales of Equity Securities and Proceeds	18
Item 3.	Defaults Upon Senior Securities	18
Item 4.	Mine Safety Disclosure	18
Item 5.	Other Information	18
Item 6.	Exhibits	19
SIGNATURES		20

2

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

China Foods Holdings Ltd.

Balance Sheets

	June 30, 2020			December 31, 2019
	$			$
	(Unaudited)			(Audited)
ASSETS
Current Assets
Bank balance		7,198			12,328
Total Current Assets		7,198			12,328
TOTAL ASSETS		7,198			12,328
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current Liabilities
Other payables		6,958			6,633
Income taxes payable		100			100
Amount due to a director		5 80,697			92,122
Amount due to the holding company		5 71,669			30,000
Total Current Liabilities and Total Liabilities		159,424			128,855
Stockholders’ Deficit
Common stock ($0.0001 par value, 100,000,000 shares authorized, 5,252,309 shares issued and outstanding)		525			525
Additional paid-in capital		136,988			136,988
Other reserve		350,547			350,547
Accumulated deficit		(640,286	)		(604,587	)
Total Stockholders’ Deficit		(152,226	)		(116,527	)
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT		7,198			12,328

The accompanying notes are an integral part of these unaudited condensed financial statements

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China Foods Holdings Ltd.

Statements of Operations

(Unaudited)

	For the three months ended June 30, 2020			For the three months ended June 30, 2019			For the six months ended June 30, 2020			For the six months ended June 30, 2019
	$			$			$			$
Income		-			-			-			-
Cost of sales		-			-			-			-
Gross profit		-			-			-			-
General and administrative expense		23,829			44,643			35,699			68,116
Loss before income taxes		(23,829	)		(44,643	)		(35,699	)		(68,116	)
Provision for income taxes		-			-			-			-
Net loss		(23,829	)		(44,643	)		(35,699	)		(68,116	)
Net loss per common share
Basic and diluted	$	(0.00	)*	$	(0.01	)*	$	(0.01	)*	$	(0.01	)*
Weighted average number of common share
Basic and diluted		5,252,309			5,252,309			5,252,309			5,252,309

*denotes net loss per common share of less than $0.01 per share.

The accompanying notes are an integral part of these financial statements

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CHINA FOODS HOLDINGS LTD.

Statements of Shareholders’ Deficit

(Unaudited)

	Common Stock				Additional paid-in		Other		Accumulated			Total Stockholders’
	Share		Amount		capital		Reserve		Deficit			Deficit
			$		$		$		$			$
Balances at December 31, 2019		5,252,309		525		136,988		350,547		(604,587	)		(116,527	)
Net loss for the period		-		-		-		-		(11,870	)		(11,870	)
Balances at March 31, 2020		5,252,309		525		136,988		350,547		(616,457	)		(128,397	)
Net loss for the period		-		-		-		-		(23,829	)		(23,829	)
Balances at June 30, 2020		5,252,309		525		136,988		350,547		(640,286	)		(152,226	)

	Common Stock					Merger Reserve		Other Reserve		Accumulated			Total stockholders’
	Share		Amount			(Note a)		(Note b)		Deficit			deficit
			$			$		$		$			$
Balances at December 31, 2018		5,251,309		137,413			-		350,547		(511,785	)		(23,825	)
Net loss for the period		-		-			-		-		(23,473	)		(23,473	)
Merger transaction		1,000		(136,888	)		136,988		-		-			100
Balances at March 31, 2019		5,252,309		525			136,988		350,547		(535,258	)		(47,198	)
Net loss for the period		-		-			-		-		(44,643	)		(44,643	)
Balances at June 30, 2019		5,252,309		525			136,988		350,547		(579,901	)		(91,841	)

Notes

(a) Merger reserve represent the difference between the nominal value of the share capital of the merged company and the cost of investment.

(b) Other reserve represent the waiver of an aggregated principal and interest of $350,547 by the president of Trafalgar Resources, Inc.

The accompanying notes are an integral part of these financial statements.

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China Foods Holdings Ltd.

Statements of Cash Flows

(Unaudited)

	For the six months ended June 30,
	2020			2019
		$			$
Operating Activities:
Net loss		(35,699	)		(68,116	)
Adjustments to reconcile net loss to net cash used in operating activities:
Changes in operating assets and liabilities:
Increase in other payables		325			4,501
Decrease in prepayment		-			(1,250	)
(Decrease) increase in amount due to a director		(11,425	)		64,865
Increase in amount due to the holding company		41,669			-
NET CASH USED BY OPERATING ACTIVITIES		(5,130	)		-
NET DECREASE IN CASH		(5,130	)		-
CASH at beginning of period		12,328			-
CASH at end of period		7,198			-
Supplemental disclosure of cash flow information
Interest paid		-			-
Taxes paid		-			100

The accompanying notes are an integral part of these financial statements

6

China Foods Holdings Ltd.

Notes to the Unaudited Condensed Financial Statements

June 30, 2020

NOTE 1 – NATURE OF OPERATIONS AND BASIS OF PRESENTATION

China Foods Holdings Ltd. (the “Company”) was incorporated in Delaware on January 10, 2019. On January 23, 2019, the Company entered into an Agreement and Plan of Merger (the “Agreement”) with Trafalgar Resources, Inc., a Utah corporation (“Trafalgar”). Pursuant to the Agreement, the Company merged with Trafalgar (the “Merger”) with the Company as the surviving entity. Prior to the Merger, Trafalgar had not commenced operations for several years that had resulted in significant revenue and Trafalgar’s efforts had been devoted primarily to activities related to raising capital and attempting to acquire an operating entity.

Prior to the Merger, Trafalgar’s majority stockholder who owned 5,000,000 shares (approximately 95.2%) of the 5,251,309 outstanding shares of Trafalgar’s common stock, par value $0.0001, signed a written consent approving the Merger and the related transactions. Such approval and consent were sufficient under Utah law and Trafalgar’s Bylaws to approve the Merger. The boards of directors and shareholders of the Company and Trafalgar approved the Merger.

Pursuant to the Merger, each share of Trafalgar’s common stock was converted into one share of the Company’s common stock. After the Merger, HY (HK) Financial Investments Co., Ltd. owns 5,001,000 shares of common stock of the Company.

The Merger was effective on March 13, 2019.

On December 11, 2019, the Board of Directors approved a change to its fiscal year-end from September 30 to December 31. As a result of this change, the fiscal year is a 3 months transition period beginning October 1, 2019 through December 31, 2019.

Basis of Presentation

The financial statements present the balance sheets, statements of operations, statements of shareholders’ deficit and statements of cash flows of the Company. These financial statements are presented in the United States dollars and have been prepared in accordance with accounting principles generally accepted in the United States of America (the “U.S. GAAP”).

Unaudited Financial Statements

The accompanying unaudited condensed financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission, or the SEC, including the instruction to Form 10-Q and Article 8 of Regulation S-X. In the opinion of Management, all adjustments, which are of a normal recurring nature, necessary for a fair presentation of the results for the six months ended June 30, 2020, have been made. Operating results for the six months ended June 30, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020. They do not include all of the information and footnotes required by United States generally accepted accounting principles for complete financial statements.

7

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUTING POLICIES

Net Loss per Common Share

Loss per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares outstanding during the reporting period. Diluted loss per share is calculated by dividing the Company’s net loss available to common shareholders by the diluted weighted average number of shares outstanding during the reporting period. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. There are no such common stock equivalents outstanding as of June 30, 2020.

Income Taxes

The Company accounts for income taxes pursuant to FASB ASC 740-10-05, “Accounting for Income Taxes”. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets will be reflected on the balance sheet when it is determined that it is more likely than not that the asset will be realized. A valuation allowance has currently been recorded to reduce our deferred tax asset to $0.

Cash and Cash Equivalents

The Company considers all highly liquid investments with an original maturity of three months or less at the time of purchase to be cash equivalents.

Fair Value of Financial Instruments

The Company’s financial instruments consist of bank balance, other payables, amount due to a director and amount due to the holding company. The carrying amount of these financial instruments approximated fair value due to the length of maturity or interest rates that approximate prevailing market rates.

Use of Estimates

The presentation of the condensed financial statements and related disclosures 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. Certain significant accounting policies that contain subjective management estimates and assumptions include those related to going concern and valuation allowance on deferred income tax. Operating results in the future could vary from the amounts derived from management’s estimates or assumptions.

Recently Issued Accounting Pronouncements

From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies that are adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on the Company’s financial position or results of operations upon adoption.

8

NOTE 3 - GOING CONCERN

The financial statements have been prepared on a going concern basis which assumes the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. The Company has incurred losses resulting in an accumulated deficit of $640,286 and net stockholders’ deficit of $152,226 as of June 30, 2020, and has negative cash flow from operations. The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and, or, to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management intends to see new capital from director and the holding company to provide needed funds. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that might result from this uncertainty.

NOTE 4 – INCOME TAXES

Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carry forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. 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 deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. Income tax periods 2017, 2018 and 2019 are open for examination by taxing authorities.

The income tax expense for the period ended June 30, 2020 differs from the amount computed using the federal statutory rates as follows:

	Six months ended June 30, 2020			Six months ended June 30 2019
	(Unaudited)			(Unaudited)
Income tax benefit at Federal tax rate of 21% for 2020 and 2019	$	(7,497	)	$	(14,304	)
Valuation allowance		7,497			14,304
		-			-

At June 30, 2020 the Company had a net operating loss carry forward. These losses will start to expire in the year 2020 through 2039. No tax benefit has been reported in the financial statements because the Company believes that it is more likely than not that the carryforwards will expire unused. The utilization of future losses may be limited under various provisions of the Internal Revenue Code pertaining to continuity of business operations limits and substantial changes in ownership. Accordingly, the potential tax benefits of the loss carryforwards are offset by a valuation allowance of the same amount. The Company has no tax positions at June 30, 2020 and December 31, 2019 for which the ultimate deductibility is highly certain but for which there is uncertainty about the timing of such deductibility.

9

NOTE 5 - AMOUNT DUE TO A DIRECTOR / THE HOLDING COMPANY

	June 30,2020		December 31,2019
	$		$
	(Unaudited)		(Audited)
Amount due to a director
Mr. Kong Xiao Jun		80,697		92,122
Amount due to the holding company
HY (HK) Financial Investments Co., Ltd.		71,669		30,000

NOTE 6: SUBSEQUENT EVENTS

On June 8, 2020, the Company executed a Share Exchange Agreement (“the “Share Exchange Agreement”) with Elite Creation Group Limited(“ECGL”), a private limited company incorporated under the laws of British Virgin Islands, and the shareholders of ECGL. Pursuant to the Share Exchange Agreement, the Company purchased Fifty Thousand (50,000) shares of ECGL (the “ECGL Shares”), representing all of the issued and outstanding shares of common stock of ECGL. As consideration, the Company agreed to issue to the shareholders of ECGL Fifteen Million (15,000,000) shares of the Company’s common stock, at a value of US$0.32 per share, for an aggregate value of US$4,800,000.

On July 9, 2020, the Company completed the acquisition of ECGL. As a result of the acquisition, the Company is no longer a shell company as defined in Rule 12b-2 under the Securities Exchange Act of 1934. Ms. Yang Liu resigned from her position as a director and Ms. Cheng Ni Hu was appointed to fill the vacancy caused by Ms. Yang Liu’s resignation.

10

Item 2. Management’s Discussion and Analysis or Plan of Operation.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This periodic report contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations, business strategies, operating efficiencies or synergies, competitive positions, growth opportunities for existing products, plans and objectives of management. Statements in this periodic report that are not historical facts are hereby identified as forward-looking statements. Our Company and our representatives may from time to time make written or oral statements that are “forward-looking,” including statements contained in this Quarterly Report and other filings with the Securities and Exchange Commission and in reports to our Company’s stockholders. Management believes that all statements that express expectations and projections with respect to future matters, as well as from developments beyond our Company’s control including changes in global economic conditions are forward-looking statements within the meaning of the Act. These statements are made on the basis of management’s views and assumptions, as of the time the statements are made, regarding future events and business performance. There can be no assurance, however, that management’s expectations will necessarily come to pass. Factors that may affect forward-looking statements include a wide range of factors that could materially affect future developments and performance, including the following:

Changes in Company-wide strategies, which may result in changes in the types or mix of businesses in which our Company is involved or chooses to invest; changes in U.S., global or regional economic conditions; changes in U.S. and global financial and equity markets, including significant interest rate fluctuations, which may impede our Company’s access to, or increase the cost of, external financing for our operations and investments; increased competitive pressures, both domestically and internationally; legal and regulatory developments, such as regulatory actions affecting environmental activities; the imposition by foreign countries of trade restrictions and changes in international tax laws or currency controls; adverse weather conditions or natural disasters, such as hurricanes and earthquakes; and labor disputes, which may lead to increased costs or disruption of operations.

This list of factors that may affect future performance and the accuracy of forward-looking statements are illustrative, but by no means exhaustive. Accordingly, all forward-looking statements should be evaluated with the understanding of their inherent uncertainty.

Business Overview

China Foods Holdings Ltd. (the “Company”) was incorporated in Delaware on January 10, 2019. Currently, the Company is in the process of investigating potential business ventures which, in the opinion of management, will provide a source of eventual profit to the Company. Such involvement may take many forms, including the acquisition of an existing business or the acquisition of assets to establish subsidiary businesses. All risks inherent in new and inexperienced enterprises are inherent in the Company’s business. Currently, the Company has no business operations.

The selection of a business opportunity in which to participate is complex and risky. Additionally, even the Company has only limited resources, experienced management team continue to explore good opportunities. There can be no assurance that the Company will be able to identify and acquire any business opportunity which will ultimately prove to be beneficial to the Company and its shareholders. The Company will select any potential business opportunity based on management’s business judgment.

11

The activities of the Company are subject to several significant risks which arise primarily as a result of the fact that the Company has no specific business and may acquire or participate in a business opportunity based on the decision of management which potentially could act without the consent, vote, or approval of the Company’s stockholders. The risks faced by the Company are further increased as a result of its lack of resources and its inability to provide a prospective business opportunity with significant capital.

Merger with Trafalgar Resources, Inc.

On January 23, 2019, the Company entered into an Agreement and Plan of Merger (the “Agreement”) with Trafalgar Resources, Inc., an Utah corporation (“Trafalgar”). Pursuant to the Agreement, the Company merged with Trafalgar (the “Merger”) with the Company as the surviving entity. Prior to the Merger, Trafalgar had not commenced operations that had resulted in significant revenue and Trafalgar’s efforts had been devoted primarily to activities related to raising capital and attempting to acquire an operating entity. The purpose of the Merger is to change the Company’s jurisdiction of incorporation from Utah to Delaware, which the Company’s management and board of directors believe is a more favorable domicile for the Company to pursue its new strategy of development and distribution of health related products, including supplements, across the global with a focus on opportunities in mainland China, Europe, and Australia.

Prior to the Merger, Trafalgar’s majority stockholder who owned 5,000,000 shares (approximately 95.2%) of the 5,251,309 outstanding shares of Trafalgar’s common stock, par value $0.0001, signed a written consent approving the Merger and the related transactions. Such approval and consent were sufficient under Utah law and Trafalgar’s Bylaws to approve the Merger. The boards of directors and shareholders of the Company and Trafalgar approved the Merger.

Pursuant to the Merger, each share of Trafalgar’s common stock was converted into one share of the Company’s common stock. After the Merger, HY (HK) Financial Investments Co., Ltd. owns 5,001,000 shares of common stock of the Company.

Previous Operations of Trafalgar Resources, Inc.

Trafalgar was incorporated under the laws of the state of Utah on October 25, 1972, under the name of Electronic Agricultural Machinery Development Corporation. The entity changed its name three times: In 1974, it changed its name to Zenith Development Corporation. In 1980, Zenith Development Corporation changed its name to Alternative Energy Resources, Inc., and in 2004, Alternative Energy Resources, Inc. changed its name to Trafalgar Resources, Inc.

Initially, Trafalgar sought to develop and market inventions, including an asparagus harvester, a hot water saving device and a gas alert signal. Ultimately, none of the inventions were successful and they were abandoned. Trafalgar ceased to conduct any business and has not conducted any business during the last three years.

12

Critical Accounting Policies, Judgments and Estimates

The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the unaudited Financial Statements and accompanying notes. Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual results could differ from these estimates under different assumptions or conditions. The Company believes there have been no significant changes during the six months period ended June 30, 2020, to the items disclosed as significant accounting policies since the Company’s last audited financial statements for the year ended December 31, 2019.

The Company’s accounting policies are more fully described in Notes 1 and 2 of the financial statements. As discussed in Notes 1 and 2, the preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions about the future events that affect the amounts reported in the financial statements and the accompanying notes. Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual differences could differ from these estimates under different assumptions or conditions. The Company believes that the following addresses the Company’s most critical accounting policies.

Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets will be reflected on the balance sheet when it is determined that it is more likely than not that the asset will be realized. A valuation allowance has currently been recorded to reduce our deferred tax asset to $0.

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Discussion and Analysis of Financial Condition and Results of Operations

The Company is in the process of looking for potential business ventures. Even the Company possesses limited funds, experienced management team of the Company will continue to locate potential business situations for investigation. The Company intends to commence, on a limited basis, the process of investigating possible merger and acquisition candidates, and believes that the Company’s status as a publicly-held corporation will enhance its ability to locate such potential business ventures. No assurance can be given as to when the Company may locate suitable business opportunities and such opportunities may be difficult to locate; however, the Company intends to actively search for potential business ventures for the foreseeable future.

Management anticipates that due to its lack of funds, and the limited amount of its resources, the Company may be restricted to participation in only one potential business venture. This lack of diversification should be considered a substantial risk because it will not permit the Company to offset potential losses from one venture against gains from another.

Business opportunities, if any arise, are expected to become available to the Company principally from the personal contacts of its officers and directors. While it is not expected that the Company will engage professional firms specializing in business acquisitions or reorganizations, such firms may be retained if funds become available in the future, and if deemed advisable. Opportunities may thus become available from professional advisors, securities broker-dealers, venture capitalists, members of the financial community, and other sources of unsolicited proposals.

In certain circumstances, the Company may agree to pay a finder’s fee or other form of compensation, including perhaps one-time cash payments, payments based upon a percentage of revenues or sales volume, and/or payments involving the issuance of securities, for services provided by persons who submit a business opportunity in which the Company shall decide to participate, although no contracts or arrangements of this nature presently exist. The Company is unable to predict at this time the cost of locating a suitable business opportunity.

The analysis of business opportunities will be undertaken by or under the supervision of the Company’s management. Among the factors which management will consider in analyzing potential business opportunities are the available technical, financial and managerial resources; working capital and financial requirements; the history of operation, if any; future prospects; the nature of present and anticipated competition; potential for further research, developments or exploration; growth and expansion potential; the perceived public recognition or acceptance of products or services; name identification, and other relevant factors.

It is not possible at present to predict the exact manner in which the Company may participate in a business opportunity. Specific business opportunities will be reviewed and, based upon such review, the appropriate legal structure or method of participation will be decided upon by management. Such structures and methods may include, without limitation, leases, purchase and sale agreements, licenses, joint ventures; and may involve merger, consolidation or reorganization. The Company may act directly or indirectly through an interest in a partnership, corporation or reorganization. However, it is most likely that any acquisition of a business venture the Company would make would be by conducting a reorganization involving the issuance of the Company’s restricted securities. Such a reorganization may involve a merger (or combination pursuant to state corporate statutes, where one of the entities dissolves or is absorbed by the other), or it may occur as a consolidation, where a new entity is formed and the Company and such other entity combine assets in the new entity. A reorganization may also occur, directly or indirectly, through subsidiaries, and there is no assurance that the Company would be the surviving entity. Any such reorganization could result in loss of control of a majority of the shares. The Company’s present directors may be required to resign in connection with a reorganization.

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The Company may choose to enter into a venture involving the acquisition of or merger with a company which does not need substantial additional capital but desires to establish a public trading market of its securities. Such a company may desire to consolidate its operations with the Company through a merger, reorganization, asset acquisition, or other combination, in order to avoid possible adverse consequences of undertaking its own public offering. Such consequences might include expense, time delays or loss of voting control. In the event of such a merger, the Company may be required to issue significant additional shares, and it may be anticipated that control over the Company’s affairs may be transferred to others.

As part of their investigation of acquisition possibilities, the Company’s management may meet with executive officers of the business and its personnel; inspect its facilities; obtain independent analysis or verification of the information provided, and conduct other reasonable measures, to the extent permitted by the Company’s limited resources and management’s limited expertise. Generally, the Company intends to analyze and make a determination based upon all available information without reliance upon any single factor as controlling.

The Company’s management expects to be experienced in the areas in which potential businesses will be investigated and in which the Company may make an acquisition or investment. Thus, it may become necessary for the Company to retain consultants or outside professional firms to assist management in evaluating potential investments. The Company can give no assurance that it will be able to find suitable consultants or managers. The Company has no policy regarding the use of consultants, however, if management, in its discretion, determines that it is in the best interests of the Company, management may seek consultants to review potential merger or acquisition candidates.

It may be anticipated that the investigation of specific business opportunities and the negotiation, drafting and execution of relevant agreements, disclosure documents and other instruments will require substantial management time and attention, and substantial costs for accountants, attorneys and others. Should a decision thereafter be made not to participate in a specific business opportunity, it is likely that costs already expended would not be recoverable. It is likely, in the event a transaction should eventually fail to be consummated, for any reason, that the costs incurred by the Company would not be recoverable. The Company’s officers and directors are entitled to reimbursement for all expenses incurred in their investigation of possible business ventures on behalf of the Company, and no assurance can be given that if the Company has available funds they will not be depleted in such expenses.

Based on current economic and regulatory conditions, management believes that it is possible, if not probable, for a company like the Company, without many assets or many liabilities, to negotiate a merger or acquisition with a viable private company. The opportunity arises principally because of the high legal and accounting fees and the length of time associated with the registration process of “going public”. However, should any of these conditions change, it is very possible that there would be little or no economic value for anyone taking over control of the Company.

Liquidity and Capital Resources

As of June 30, 2020, the Company had $7,198 in current assets and $159,424 in current liabilities resulting in a negative working capital as of June 30, 2020 of $152,226. The Company has only incidental ongoing expenses primarily associated with maintaining its corporate status and maintaining the Company’s reporting obligations to the Securities and Exchange Commission. Although not required or under any contractual commitment, current management has indicated a willingness to help support the Company’s ongoing expenses through the purchase of securities of the Company or loans to the Company. Existing liabilities are related to loans by management to help fund ongoing expenses.

15

For the three and six months ended June 30, 2020, the Company had $23,829 and $35,699 in general and administrative expense related to maintaining its corporate status, and paying accounting and legal fees. Management anticipates only nominal continuing expenses related to investigating business opportunities and legal and accounting costs. For the three and six months ended June 30, 2020, the Company had a net loss of $23,829 and $35,699, respectively, compared to a loss of $44,643 and $68,116 for the three and six months ended June 30, 2019.

The principal stockholder has undertaken to finance the Company in cash for a “reasonable” period of time for the Company to continue as a going concern, assuming that in such a period of time the Company would be able to restructure its business and restart on a revenue-generating operation to support its continuation. However, it is uncertain as for how long or to what extent such a period of time would be “reasonable”, and there can be no assurance that the financing from the principal stockholder will not be discontinued.

These uncertainties may result in adverse effects on continuation of the Company as a going concern. The accompanying financial statements do not include or reflect any adjustments that might result from the outcome of these uncertainties.

RESULTS OF OPERATIONS

The Company has not had any significant revenues. The Company continues to suffer a loss related to maintaining its corporate status and reporting obligations. For the three and six months ended June 30, 2020, the Company had a net loss of $23,829 and $35,699, respectively.

Going Concern

These condensed financial statements have been prepared on a going concern basis. The Company has incurred net operating losses of $35,699 from inception through June 30, 2020 and has not yet established on going source of revenues sufficient to cover its operating costs and allow it continue as a going concern. As of June 30, 2020, we had an accumulated deficit totaling $640,286. The ability of the Company to continue as a going concern is dependent on the Company obtaining the adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations. This raises substantial doubts about our ability to continue as a going concern.

Forward-looking Statements

The Private Securities Litigation Reform Act of 1995 (the “Act”) provides a safe harbor for forward-looking statements made by or on behalf of our Company. Our Company and our representatives may from time to time make written or oral statements that are “forward-looking,” including statements contained in this report and other filings with the Securities and Exchange Commission and in reports to our Company’s stockholders. Management believes that all statements that express expectations and projections with respect to future matters, as well as from developments beyond our Company’s control including changes in global economic conditions are forward-looking statements within the meaning of the Act. These statements are made on the basis of management’s views and assumptions, as of the time the statements are made, regarding future events and business performance. There can be no assurance, however, that management’s expectations will necessarily come to pass. Factors that may affect forward-looking statements include a wide range of factors that could materially affect future developments and performance, including the following:

Changes in Company-wide strategies, which may result in changes in the types or mix of businesses in which our Company is involved or chooses to invest; changes in U.S., global or regional economic conditions; changes in U.S. and global financial and equity markets, including significant interest rate fluctuations, which may impede our Company’s access to, or increase the cost of, external financing for our operations and investments; increased competitive pressures, both domestically and internationally; legal and regulatory developments, such as regulatory actions affecting environmental activities; the imposition by foreign countries of trade restrictions and changes in international tax laws or currency controls; adverse weather conditions or natural disasters, such as hurricanes and earthquakes; and labor disputes, which may lead to increased costs or disruption of operations.

16

This list of factors that may affect future performance and the accuracy of forward-looking statements is illustrative, but by no means exhaustive. Accordingly, all forward-looking statements should be evaluated with the understanding of their inherent uncertainty.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Not required for smaller reporting companies.

Item 4. Controls and Procedures

Our Chief Executive Officer and Chief Financial Officer are responsible for establishing and maintaining disclosure controls and procedures for the Company.

(a) Evaluation of Disclosure Controls and Procedures

Our management evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based on that evaluation, our President and Principal Financial Officer concluded that our disclosure controls and procedures as of the end of the period covered by this report were not effective such that the information required to be disclosed by us in reports filed under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to our management as appropriate to allow timely decisions regarding disclosure. A controls system cannot provide absolute assurance, however, that the objectives of the controls system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected but we believe the controls and procedures do provide a reasonable assurance.

(b) Changes in the Company’s Internal Controls Over Financial Reporting

There have been no changes in internal control over financial reporting that occurred during the last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the internal control over financial reporting.

17

Part II - Other Information

Item 1. Legal Proceedings

There are no legal proceedings, which are pending or have been threatened against us or any of our officers, directors or control persons of which management is aware.

Item 1A. Risk Factors

Not applicable to smaller reporting companies.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Recent Sales of Unregistered Securities

We have not sold any restricted securities during the six months ended June 30, 2020.

Use of Proceeds of Registered Securities

None; not applicable.

Purchases of Equity Securities by Us and Affiliated Purchasers

During the six months ended June 30, 2020, we have not purchased any equity securities.

Item 3. Defaults Upon Senior Securities

We are not aware of any defaults upon senior securities. Management has indicated they do not, at this time, intend to pursue the defaults.

Item 4. Mine Safety Disclosures

None; not applicable.

Item 5. Other Information

None; not applicable.

18

Item 6. Exhibits

Exhibits No.
31.1	Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1	Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101.INS*	XBRL Instance Document
101.SCH*	XBRL Taxonomy Extension Schema Document
101.CAL*	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*	XBRL Taxonomy Extension Label Linkbase Document
101.PRE*	XBRL Taxonomy Extension Presentation Linkbase Document

* These interactive data files are deemed “furnished” and not “filed” or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, or deemed “furnished” and not “filed” for purposes of Section 18 of the Securities and Exchange Act of 1934, and otherwise is not subject to liability under these sections.

19

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

China Foods Holdings Ltd.
Dated: August 14, 2020	By:	/s/ Kong Xiao Jun
		Kong Xiao Jun
		Chief Executive Officer & Chief Financial Officer

20

EX-31.1

Exhibit 31.1

Rule 13a-14(a) Certification of the Chief Executive Officer

Pursuant to 18 U.S.C. 1350

(Section 302 of the Sarbanes-Oxley Act of 2002)

I, Kong Xiao Jun, certify that:

1.	I have reviewed this report on Form 10-Q of China Foods Holdings Ltd.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this report is being prepared;

b) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report my conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and

c) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s fourth fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 14, 2020	By:	/s/ Kong Xiao Jun
		Kong Xiao Jun
		Chief Executive Officer & Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

AND PRINCIPAL FINANCIAL OFFICER

Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

I, Kong Xiao Jun, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Quarterly Report of China Foods Holdings Ltd. on Form 10-Q for the period ended June 30, 2020, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained in such Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of china Foods Holdings Ltd..

Date: August 14, 2020	By:	/s/ Kong Xiao Jun
		Kong Xiao Jun
		Chief Executive Officer & Chief Financial Officer

XML

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2020	Aug. 14, 2020
Cover [Abstract]
Entity Registrant Name	China Foods Holdings Ltd.
Entity Central Index Key	0001310630
Document Type	10-Q
Document Period End Date	Jun. 30, 2020
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business Flag	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		5,252,309
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2020

XML

Balance Sheets - USD ($)	Jun. 30, 2020	Dec. 31, 2019
Current Assets
Bank balance	$ 7,198	$ 12,328
Total Current Assets	7,198	12,328
TOTAL ASSETS	7,198	12,328
Current Liabilities
Other payables	6,958	6,633
Income taxes payable	100	100
Amount due to a director	580,697	92,122
Amount due to the holding company	571,669	30,000
Total Current Liabilities and Total Liabilities	159,424	128,855
Stockholders' Deficit
Common stock ($0.0001 par value, 100,000,000 shares authorized, 5,252,309 shares issued and outstanding)	525	525
Additional paid-in capital	136,988	136,988
Other reserve	350,547	350,547
Accumulated deficit	(640,286)	(604,587)
Total Stockholders' Deficit	(152,226)	(116,527)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	$ 7,198	$ 12,328

XML

Balance Sheets (Parenthetical) - $ / shares	Jun. 30, 2020	Dec. 31, 2019
Statement of Financial Position [Abstract]
Common stock, par value	$ 0.0001	$ 0.0001
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	5,252,309	5,252,309
Common stock, shares outstanding	5,252,309	5,252,309

XML

Statements of Operations (Unaudited) - USD ($)		3 Months Ended		6 Months Ended
		Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Income Statement [Abstract]
Income
Cost of sales
Gross profit
General and administrative expense		23,829	44,643	35,699	68,116
Loss before income taxes		(23,829)	(44,643)	(35,699)	(68,116)
Provision for income taxes
Net loss		$ (23,829)	$ (44,643)	$ (35,699)	$ (68,116)
Net loss per common share Basic and diluted	[1]	$ (0.00)	$ (0.01)	$ (0.01)	$ (0.01)
Weighted average number of common share Basic and diluted		5,252,309	5,252,309	5,252,309	5,252,309

[1] denotes net loss per common share of less than $0.01 per share.

XML

Statements of Shareholders' Deficit (Unaudited) - USD ($)	Common Stock [Member]	Additional Paid-In Capital [Member]	Merger Reserve [Member]	[1]	Other Reserve [Member]		Accumulated Deficit [Member]	Total
Balance at Dec. 31, 2018	$ 137,413				$ 350,547	[2]	$ (511,785)	$ (23,825)
Balance, shares at Dec. 31, 2018	5,251,309
Merger transaction	$ (136,888)		136,988			[2]		100
Merger transaction, shares	1,000
Net loss for the period						[2]	(23,473)	(23,473)
Balance at Mar. 31, 2019	$ 525		136,988		350,547	[2]	(535,258)	(47,198)
Balance, shares at Mar. 31, 2019	5,252,309
Balance at Dec. 31, 2018	$ 137,413				350,547	[2]	(511,785)	(23,825)
Balance, shares at Dec. 31, 2018	5,251,309
Net loss for the period								(68,116)
Balance at Jun. 30, 2019	$ 525		136,988		350,547	[2]	(579,901)	(91,841)
Balance, shares at Jun. 30, 2019	5,252,309
Balance at Mar. 31, 2019	$ 525		136,988		350,547	[2]	(535,258)	(47,198)
Balance, shares at Mar. 31, 2019	5,252,309
Net loss for the period							(44,643)	(44,643)
Balance at Jun. 30, 2019	$ 525		$ 136,988		350,547	[2]	(579,901)	(91,841)
Balance, shares at Jun. 30, 2019	5,252,309
Balance at Dec. 31, 2019	$ 525	$ 136,988			350,547		(604,587)	(116,527)
Balance, shares at Dec. 31, 2019	5,252,309
Net loss for the period							(11,870)	(11,870)
Balance at Mar. 31, 2020	$ 525	136,988			350,547		(616,457)	(128,397)
Balance, shares at Mar. 31, 2020	5,252,309
Balance at Dec. 31, 2019	$ 525	136,988			350,547		(604,587)	(116,527)
Balance, shares at Dec. 31, 2019	5,252,309
Net loss for the period								(35,699)
Balance at Jun. 30, 2020	$ 525	136,988			350,547		(640,286)	(152,226)
Balance, shares at Jun. 30, 2020	5,252,309
Balance at Mar. 31, 2020	$ 525	136,988			350,547		(616,457)	(128,397)
Balance, shares at Mar. 31, 2020	5,252,309
Net loss for the period							(23,829)	(23,829)
Balance at Jun. 30, 2020	$ 525	$ 136,988			$ 350,547		$ (640,286)	$ (152,226)
Balance, shares at Jun. 30, 2020	5,252,309

[1] Merger reserve represent the difference between the nominal value of the share capital of the merged company and the cost of investment.

[2] Other reserve represent the waiver of an aggregated principal and interest of $350,547 by the president of Trafalgar Resources, Inc.

XML

Statements of Shareholders' Deficit (Parenthetical) - USD ($)	Jun. 30, 2019	Mar. 31, 2019
Trafalgar Resources, Inc., [Member]
Aggregated principal and interest amount	$ 350,547	$ 350,547

XML

Statements of Cash Flows (Unaudited) - USD ($)	3 Months Ended				6 Months Ended
	Jun. 30, 2020	Mar. 31, 2020	Jun. 30, 2019	Mar. 31, 2019	Jun. 30, 2020	Jun. 30, 2019
Operating Activities:
Net loss	$ (23,829)	$ (11,870)	$ (44,643)	$ (23,473)	$ (35,699)	$ (68,116)
Changes in operating assets and liabilities:
Increase in other payables					325	4,501
Decrease in prepayment						(1,250)
(Decrease) increase in amount due to a director					(11,425)	64,865
Increase in amount due to the holding company					41,669
NET CASH USED BY OPERATING ACTIVITIES					(5,130)
NET DECREASE IN CASH					(5,130)
CASH at beginning of period		$ 12,328			12,328
CASH at end of period	$ 7,198				7,198
Supplemental disclosure of cash flow information
Interest paid
Taxes paid						$ 100

XML

Nature of Operations and Basis of Presentation

6 Months Ended

Jun. 30, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Nature of Operations and Basis of Presentation

NOTE 1 – NATURE OF OPERATIONS AND BASIS OF PRESENTATION

China Foods Holdings Ltd. (the “Company”) was incorporated in Delaware on January 10, 2019. On January 23, 2019, the Company entered into an Agreement and Plan of Merger (the “Agreement”) with Trafalgar Resources, Inc., a Utah corporation (“Trafalgar”). Pursuant to the Agreement, the Company merged with Trafalgar (the “Merger”) with the Company as the surviving entity. Prior to the Merger, Trafalgar had not commenced operations for several years that had resulted in significant revenue and Trafalgar’s efforts had been devoted primarily to activities related to raising capital and attempting to acquire an operating entity.

Prior to the Merger, Trafalgar’s majority stockholder who owned 5,000,000 shares (approximately 95.2%) of the 5,251,309 outstanding shares of Trafalgar’s common stock, par value $0.0001, signed a written consent approving the Merger and the related transactions. Such approval and consent were sufficient under Utah law and Trafalgar’s Bylaws to approve the Merger. The boards of directors and shareholders of the Company and Trafalgar approved the Merger.

 Pursuant to the Merger, each share of Trafalgar’s common stock was converted into one share of the Company’s common stock. After the Merger, HY (HK) Financial Investments Co., Ltd. owns 5,001,000 shares of common stock of the Company.

The Merger was effective on March 13, 2019.

On December 11, 2019, the Board of Directors approved a change to its fiscal year-end from September 30 to December 31. As a result of this change, the fiscal year is a 3 months transition period beginning October 1, 2019 through December 31, 2019.

Basis of Presentation

The financial statements present the balance sheets, statements of operations, statements of shareholders’ deficit and statements of cash flows of the Company. These financial statements are presented in the United States dollars and have been prepared in accordance with accounting principles generally accepted in the United States of America (the “U.S. GAAP”).

Unaudited Financial Statements

The accompanying unaudited condensed financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission, or the SEC, including the instruction to Form 10-Q and Article 8 of Regulation S-X. In the opinion of Management, all adjustments, which are of a normal recurring nature, necessary for a fair presentation of the results for the six months ended June 30, 2020, have been made. Operating results for the six months ended June 30, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020. They do not include all of the information and footnotes required by United States generally accepted accounting principles for complete financial statements.

XML

Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2020

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUTING POLICIES

Net Loss per Common Share

Loss per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares outstanding during the reporting period. Diluted loss per share is calculated by dividing the Company’s net loss available to common shareholders by the diluted weighted average number of shares outstanding during the reporting period. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. There are no such common stock equivalents outstanding as of June 30, 2020.

Income Taxes

The Company accounts for income taxes pursuant to FASB ASC 740-10-05, “Accounting for Income Taxes”. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets will be reflected on the balance sheet when it is determined that it is more likely than not that the asset will be realized. A valuation allowance has currently been recorded to reduce our deferred tax asset to $0.

Cash and Cash Equivalents

The Company considers all highly liquid investments with an original maturity of three months or less at the time of purchase to be cash equivalents.

Fair Value of Financial Instruments

 The Company’s financial instruments consist of bank balance, other payables, amount due to a director and amount due to the holding company. The carrying amount of these financial instruments approximated fair value due to the length of maturity or interest rates that approximate prevailing market rates.

Use of Estimates

The presentation of the condensed financial statements and related disclosures 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. Certain significant accounting policies that contain subjective management estimates and assumptions include those related to going concern and valuation allowance on deferred income tax. Operating results in the future could vary from the amounts derived from management’s estimates or assumptions.

Recently Issued Accounting Pronouncements

From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies that are adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on the Company’s financial position or results of operations upon adoption.

XML

Going Concern

6 Months Ended

Jun. 30, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Going Concern

NOTE 3 - GOING CONCERN

The financial statements have been prepared on a going concern basis which assumes the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. The Company has incurred losses resulting in an accumulated deficit of $640,286 and net stockholders’ deficit of $152,226 as of June 30, 2020, and has negative cash flow from operations. The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and, or, to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management intends to see new capital from director and the holding company to provide needed funds. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that might result from this uncertainty.

XML

Income Taxes

6 Months Ended

Jun. 30, 2020

Income Tax Disclosure [Abstract]

Income Taxes

NOTE 4 – INCOME TAXES

Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carry forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. 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 deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. Income tax periods 2017, 2018 and 2019 are open for examination by taxing authorities.

The income tax expense for the period ended June 30, 2020 differs from the amount computed using the federal statutory rates as follows:

	Six months ended June 30, 2020			Six months ended June 30 2019
	(Unaudited)			(Unaudited)
Income tax benefit at Federal tax rate of 21% for 2020 and 2019	$	(7,497	)	$	(14,304	)
Valuation allowance		7,497			14,304
		-			-

At June 30, 2020 the Company had a net operating loss carry forward. These losses will start to expire in the year 2020 through 2039. No tax benefit has been reported in the financial statements because the Company believes that it is more likely than not that the carryforwards will expire unused. The utilization of future losses may be limited under various provisions of the Internal Revenue Code pertaining to continuity of business operations limits and substantial changes in ownership. Accordingly, the potential tax benefits of the loss carryforwards are offset by a valuation allowance of the same amount. The Company has no tax positions at June 30, 2020 and December 31, 2019 for which the ultimate deductibility is highly certain but for which there is uncertainty about the timing of such deductibility.

XML

Amount Due to a Director / The Holding Company

6 Months Ended

Jun. 30, 2020

Related Party Transactions [Abstract]

Amount Due to a Director / The Holding Company

NOTE 5 - AMOUNT DUE TO A DIRECTOR / THE HOLDING COMPANY

	June 30,2020		December 31,2019
	$		$
	(Unaudited)		(Audited)
Amount due to a director
Mr. Kong Xiao Jun		80,697		92,122
Amount due to the holding company
HY (HK) Financial Investments Co., Ltd.		71,669		30,000

XML

Subsequent Events

6 Months Ended

Jun. 30, 2020

Subsequent Events [Abstract]

Subsequent Events

NOTE 6: SUBSEQUENT EVENTS

On June 8, 2020, the Company executed a Share Exchange Agreement (“the “Share Exchange Agreement”) with Elite Creation Group Limited(“ECGL”), a private limited company incorporated under the laws of British Virgin Islands, and the shareholders of ECGL. Pursuant to the Share Exchange Agreement, the Company purchased Fifty Thousand (50,000) shares of ECGL (the “ECGL Shares”), representing all of the issued and outstanding shares of common stock of ECGL. As consideration, the Company agreed to issue to the shareholders of ECGL Fifteen Million (15,000,000) shares of the Company’s common stock, at a value of US$0.32 per share, for an aggregate value of US$4,800,000.

On July 9, 2020, the Company completed the acquisition of ECGL. As a result of the acquisition, the Company is no longer a shell company as defined in Rule 12b-2 under the Securities Exchange Act of 1934. Ms. Yang Liu resigned from her position as a director and Ms. Cheng Ni Hu was appointed to fill the vacancy caused by Ms. Yang Liu’s resignation.

XML

Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2020

Accounting Policies [Abstract]

Net Loss Per Common Share

Net Loss per Common Share

Loss per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares outstanding during the reporting period. Diluted loss per share is calculated by dividing the Company’s net loss available to common shareholders by the diluted weighted average number of shares outstanding during the reporting period. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. There are no such common stock equivalents outstanding as of June 30, 2020.

Income Taxes

Income Taxes

The Company accounts for income taxes pursuant to FASB ASC 740-10-05, “Accounting for Income Taxes”. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets will be reflected on the balance sheet when it is determined that it is more likely than not that the asset will be realized. A valuation allowance has currently been recorded to reduce our deferred tax asset to $0.

Cash and Cash Equivalents

Cash and Cash Equivalents

The Company considers all highly liquid investments with an original maturity of three months or less at the time of purchase to be cash equivalents.

Fair Value of Financial Instruments

Fair Value of Financial Instruments

 The Company’s financial instruments consist of bank balance, other payables, amount due to a director and amount due to the holding company. The carrying amount of these financial instruments approximated fair value due to the length of maturity or interest rates that approximate prevailing market rates.

Use of Estimates

Use of Estimates

The presentation of the condensed financial statements and related disclosures 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. Certain significant accounting policies that contain subjective management estimates and assumptions include those related to going concern and valuation allowance on deferred income tax. Operating results in the future could vary from the amounts derived from management’s estimates or assumptions.

Recently Issued Accounting Pronouncements

Recently Issued Accounting Pronouncements

From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies that are adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on the Company’s financial position or results of operations upon adoption.

XML

Income Taxes (Tables)

6 Months Ended

Jun. 30, 2020

Income Tax Disclosure [Abstract]

Schedule of Components of Income Tax Expense

The income tax expense for the period ended June 30, 2020 differs from the amount computed using the federal statutory rates as follows:

	Six months ended June 30, 2020			Six months ended June 30 2019
	(Unaudited)			(Unaudited)
Income tax benefit at Federal tax rate of 21% for 2020 and 2019	$	(7,497	)	$	(14,304	)
Valuation allowance		7,497			14,304
		-			-

XML

Amount Due to a Director / The Holding Company (Tables)

6 Months Ended

Jun. 30, 2020

Related Party Transactions [Abstract]

Schedule of Due to Related Party Transactions

	June 30,2020		December 31,2019
	$		$
	(Unaudited)		(Audited)
Amount due to a director
Mr. Kong Xiao Jun		80,697		92,122
Amount due to the holding company
HY (HK) Financial Investments Co., Ltd.		71,669		30,000

XML

Nature of Operations and Basis of Presentation (Details Narrative) - $ / shares	Jan. 23, 2019	Jun. 30, 2020	Dec. 31, 2019
Common stock, shares outstanding		5,252,309	5,252,309
Common stock, par value		$ 0.0001	$ 0.0001
HY (HK) Financial Investments Co., Ltd [Member]
Conversion of common stock description	Each share of Trafalgar's common stock was converted into one share of the Company's common stock.
Number of shares owned for common stock	5,001,000
Agreement [Member] | Trafalgar Resources, Inc., [Member]
Number of shares owned majority shareholder	5,000,000
Ownership percentage	95.20%
Common stock, shares outstanding	5,251,309
Common stock, par value	$ 0.0001

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Summary of Significant Accounting Policies (Details Narrative)	Jun. 30, 2020 USD ($)
Accounting Policies [Abstract]
Deferred tax valuation allowance	$ 0

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Going Concern (Details Narrative) - USD ($)	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Accumulated deficit	$ (640,286)		$ (604,587)
Stockholders' deficit, net	$ (152,226)	$ (128,397)	$ (116,527)	$ (91,841)	$ (47,198)	$ (23,825)

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Income Taxes (Details Narrative)	6 Months Ended
	Jun. 30, 2020
Income Tax Disclosure [Abstract]
Income tax expired date	Expire in the year 2020 through 2039

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Income Taxes - Schedule of Components of Income Tax Expense (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Jun. 30, 2020	Jun. 30, 2019
Income Tax Disclosure [Abstract]
Income tax benefit at Federal tax rate of 21% for 2020 and 2019			$ (7,497)	$ (14,304)
Valuation allowance			7,497	14,304
Income tax expense

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Income Taxes - Schedule of Components of Income Tax Expense (Details) (Parenthetical)	6 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
Income Tax Disclosure [Abstract]
Federal tax rate percentage	21.00%	21.00%

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Amount Due to a Director / The Holding Company - Schedule of Due to Related Party Transactions (Details) - USD ($)	Jun. 30, 2020	Dec. 31, 2019
Due to related party	$ 580,697	$ 92,122
Mr. Kong Xiao Jun [Member]
Due to related party	80,697	92,122
HY (HK) Financial Investments Co., Ltd [Member]
Due to related party	$ 71,669	$ 30,000

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Subsequents Events (Details Narrative) - Share Exchange Agreement [Member] - Elite Creation Group Limited [Member] - Common Stock [Member]	Jun. 08, 2020 USD ($) $ / shares shares
Number of shares acquired in an agreement	50,000
Shares issued as a consideration on acquisition	15,000,000
Share price per share | $ / shares	$ 0.32
Aggregate value of shares issued as a consideration on acquisition | $	$ 4,800,000