10-Q

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended September 30, 2015

or

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

For the transition period from __________ to __________

Commission File Number: 000-52276

W&E SOURCE CORP.
(Exact name of registrant as specified in its charter)

Delaware	98-0471083
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)

113 Barksdale Professional Center, Newark, DE 19711
(Address of principal executive offices) (Zip Code)

(302) 722-6266
(Registrant’s telephone number, including area code)

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 and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 and post 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” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer [   ]	Accelerated filer                   [   ]
Non-accelerated filer   [   ]	Smaller reporting company [X]
(Do not check if a smaller reporting company)

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

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 63,438,300 shares of common stock issued and outstanding as of October 30, 2015.

1

TABLE OF CONTENTS

PART I – FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS	1
Report of Independent Registered Public Accounting Firm	2
Condensed Consolidated Balance Sheets	3
Condensed Consolidated Statements of Income and Comprehensive Income	4
Condensed Consolidated Statements of Cash Flows	5
Consolidated Statement of Stockholder’s Equity	6
Notes to Condensed Consolidated Financial Statements	7
ITEM 2 MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	13
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	16
ITEM 4. CONTROLS AND PROCEDURES.	16
PART II – OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.	17
ITEM 1A. RISK FACTORS	17
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	17
ITEM 3. DEFAULTS UPON SENIOR SECURITIES	17
ITEM 4. MINE SAFETY DISCLOSURES	17
ITEM 5. OTHER INFORMATION	17
ITEM 6. EXHIBITS	18
SIGNATURES	19

2

PART I—FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

1

 

2

W&E Source Corp. and Subsidiaries
(Formerly News of China Inc.)
Condensed Consolidated Statements of Income and Comprehensive Income
For the Three Months Ended September 30, 2015 and 2014
(Unaudited)

		September 30, 2015			June 30, 2015
Assets
Current Assets
Cash	$	4,301		$	10,893
Accounts receivable		509			603
Advanced expense		606			-
Total current assets		5,416			11,496
Non-Current Assets
Prepayments/Deposits		11,240			12,009
Total non-current assets		11,240			12,009
TOTAL ASSETS	$	16,656		$	23,505
Liabilities and Shareholders’ Equity (Deficit)
Current liabilities
Accounts payable and accrued liabilities	$	35,660		$	7,128
Wage payable and other payable		-			2,142
Advanced for share issuance		39,695			42,412
Advances from related parties and related party payables		3,597			27,841
Customer deposit		1,124			-
Total current liabilities		80,076			79,523
TOTAL LIABILITIES		80,076			79,523
Shareholders' equity (deficit)
Common stock, $0.0001 par value, 500,000,000 shares authorized, 63,438,300 shares issued and outstanding as of September 30, 2015 and June 30, 2015, respectively		6,344			6,344
Additional paid-in capital		957,055			957,055
Accumulated deficit		(1,034,307	)		(1,023,523	)
Accumulated other comprehensive income		7,488			4,106
Total shareholders’ deficit		(63,420	)		(56,018	)
TOTAL LIABILITIES AND SHAREHOLDERS’ DEFICIT	$	16,656		$	23,505

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

3

W&E Source Corp. and Subsidiaries
(Formerly News of China Inc.)
Condensed Consolidated Statements of Income and Comprehensive Income
For the Three Months Ended September 30, 2015 and 2014
(Unaudited)

		September 30, 2015			September 30, 2014
Net revenues	$	616		$	857
Gross profit		616			857
Operating expenses
General and administrative expenses		9,716			20,879
Total operating expenses		9,716			20,879
Operating Loss		(9,100	)		(20,022	)
Other Income (expense)
Foreign currency exchange (loss) gain		(1,684	)		1,095
Total other income (expense)	$	(1,684	)	$	1,095
Net loss		(10,784	)		(18,927	)
Other comprehensive income (loss)
Cumulative foreign currency Translation adjustment		3,382			667
Comprehensive loss	$	(7,402	)	$	(18,260	)
Weighted average number of shares outstanding – basic and diluted		63,483,300			47,900,000
Loss per share – basic and diluted		(0.00	)		(0.00	)

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

4

W&E Source Corp. and Subsidiaries
(Formerly News of China Inc.)
Consolidated Statements of Cash Flow
For the Three Months Ended September 30, 2015 and 2014
(Unaudited)

		September 30, 2015			September 30, 2014
Cash Flow from Operating Activities
Net loss	$	(10,784	)	$	(18,927	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense		-			3,435
Foreign currency exchange loss		3,320			-
Change in operating assets and liabilities:
Decrease in accounts receivable		69			2,011
Decrease (increase) in prepaid expenses and deposits		76			-
Increase (decrease) in accounts payable and accrued		(14	)		(7,519	)
liabilities
Increase (decrease) in customer deposits		1,146			50
Net cash sourced (used) in operating activities		(6,187	)		(20,950	)
Cash Flows from Investing Activities
Net cash sourced (used) in investing activities		-			-
Cash Flows from Financing Activities
Due to related party		1,833			21,483
Net cash provided (used) by financing activities		1,833			21,483
Cumulative translation adjustment		(2,238	)		(520	)
Net increase (decrease) in cash & cash equivalents for the year		(6,592	)		13
Beginning of period
		10,893			14,570
End of period	$	4,301		$	14,583
Supplemental cash flows information
Interest received		-			-
Interest paid		-			-
Income tax paid		-			-

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

5

W&E Source Corp. and Subsidiaries
(Formerly News of China, Inc.)
Consolidated Statements of Changes in Shareholders’ Equity (Deficit)
For the Three Months Ended September 30, 2015 and Year Ended June 30, 2015
(Unaudited)

						Accumulated				Total
			Additional			other				Shareholders’
		Common stock	Paid-in	Capital		Comprehensive		Accumulated		equity
	Shares	Amount	Capital	Stock		Income		Deficit		(deficit)
Balance at June 30, 2011	25,900,000	2,590	173,695	-		1,677		(199,860	)	(21,898	)
Issue of common shares	22,000,000	2,200	627,800	-		-		-		630,000
Donated capital	-	-	1,731	-		-		-		1,731
Foreign currency    translation adjustment	-	-	-	-		(1,277	)	-		(1,277	)
Net loss	-	-	-	-		-		(305,309	)	(305,309	)
Balance at June 30, 2012	47,900,000	4,790	803,226	-		400		(505,169	)	303,247
Capital stock	-	-	-	(301,000	)	-		-		(301,000	)
Capital stock	-	-	-	301,000		-		-		301,000
Foreign currency    translation adjustment	-	-	-	-		3,151		-		3,151
Net loss	-	-	-	-		-		(261,213	)	(261,213	)
Balance at June 30, 2013	47,900,000	4,790	803,226	-		3,551		(766,382	)	45,185
Foreign currency    translation adjustment	-	-	-	-		(4,211	)	-		(4,211	)
Net loss	-	-	-	-		-		(176,000	)	(176,000	)
Balance at June 30, 2014	47,900,000	4,790	803,226	-		(660	)	(942,382	)	(135,026	)
Capital stock	15,538,300	1,554	153,829			-		-		155,383
Foreign currency    translation adjustment	-	-	-	-		4,766		-		4,766
Net loss	-	-		-		-		(81,141	)	(81,141	)
Balance at June 30, 2015	63,438,300	6,344	957,055	-		4,106		(1,023,523	)	(56,018	)
Foreign currency    translation adjustment	-	-	-	-		3,382		-		3,382
Net Loss	-	-	-	-				(10,784	)	(10,784	)
Balance at September 30, 2015	63,438,300	6,344	957,055	-		7,488		(1,034,307	)	(63,420	)

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

6

W&E Source Corp. and Subsidiaries
(Formerly News of China, Inc.)
Notes to Consolidated Financial Statements
For the Three months Ended September 30, 2015 and 2014

Note 1 – Organization, Nature of Operations and Basis of Presentation

W&E Source Corp. (“the Company”) was incorporated in the State of Delaware on October 11, 2005 and is based in Montréal, Québec, Canada. The Company is providing air ticket reservations, hotel reservations and other travel related services.

On August 25, 2011, the Company incorporated a company called Airchn Travel Global, Inc. (“ATGI”) in the State of Washington, USA. ATGI is a wholly owned subsidiary of the Company. ATGI focuses on a business segment of travel businesses which includes air ticket reservations, hotel reservations and other travel services.

On October 4, 2011, the Company incorporated a company called Airchn Travel (Canada) Inc. (“ATCI”) in the Province of British Columbia, Canada. ATCI is a wholly owned subsidiary of ATGI. ATCI has a similar business segment as ATGI.

In January 2012, the Company changed its name from News of China, Inc. to W&E Source Corp. and increased its authorized shares to 500,000,000 shares. As a result of the name change, the Company’s listing symbol on OTCQB is also changed to WESC.

During the period ended March 31, 2012, the Company incorporated a company named Airchn Travel (Beijing) Inc. (“ATBI”) in Beijing, China. ATBI is also a wholly owned subsidiary of ATGI. ATBI has a similar business segment as ATGI.

On December 15, 2012, Airchin Travel (Beijing) Inc., a wholly owned subsidiary of W&E Source Corp. (the “Company”), entered into the Share Purchase Agreement (the “Agreement”) with Mr. Wu Hao (the “Seller”), a majority shareholder of Chengdu Baopiao Internet Co., Ltd. (“Baopiao”), to acquire part of his ownership in Baopiao which equals 51% of all issued and outstanding stock of Baopiao (the “Shares”).

The Company will pay for the aggregate purchase price of RMB 2,550,000 for the Shares in cash and by assuming the Seller’s debt to Baopiao in the amount of RMB1,800,000 (approximately US$289,000) (the “Debt”). According to the terms of the Agreement, the Company will assume the Debt upon execution of the Agreement and pay the Seller the remaining RMB750,000 of the purchase price within 20 days from the execution of the Agreement. Also at execution, the Company will paid Baopiao RMB200,000 as repayment of the Debt and satisfy the remaining Debt of RMB1,600,000 within 20 day from the execution of the Agreement.

Also pursuant to the Agreement, the Seller will provide guaranties that other than the information including financial statements provided to the Company, Baopiao does not have any other debts, and no third party has any rights or liens on the assets of Baopiao. The Seller and Baopiao will also indemnify the Company against any damages, liabilities, losses and expenses, which the Company may sustain or suffer due to any breach of the guaranties made by the Seller or Baopiao.

Baopiao has obtained the necessary shareholder approval for the transfer of the Shares and will register the transfer of the Shares with the applicable State Administration for Industry and Commerce within three days from the date of the Agreement.

In connection with the Agreement, the Company also entered into an agreement with the Seller and Baopiao that as an incentive for the management team of Baopiao, the Company will reserve up to 26 million shares of its common stock for issuance to the Baopiao employees upon achievement of certain milestones over the next three years.

7

W&E Source Corp. and Subsidiaries
(Formerly News of China, Inc.)
Notes to Consolidated Financial Statements
For the Three months Ended September 30, 2015 and 2014

The Share Purchase Agreement with Mr. Wu Hao was not completed in January 2013, and both the Company and Mr. Wu Hao agreed to terminate the agreement entered on December 15, 2012.

On October 26, 2014, the Company issued 15,538,300 common shares of the Company to settle the debts payable of $155,383 to related parties at $0.01 per share.

Note 2 – Summary of Significant Accounting Policies

a.	Basis of presentation.
	The Company prepares its financial statements in accordance with accounting principles generally accepted in the United States. This basis of accounting involves the application of accrual accounting and consequently, revenues and gains are recognized when earned, and expenses and losses are recognized when incurred. The financial statements are expressed in U.S. dollars. These unaudited financial statements should be read in conjunction with a reading of the financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended June 30, 2015, as filed with the U.S. Securities and Exchange Commission.
b.	Foreign currency translation.
	ATCI's and ATBI’s functional currency for operations is the Canadian dollar and Chinese Yuan. However, the Company's reporting currency is in U.S. dollar. Therefore, the financial statements for all periods presented have been translated into U.S. dollar using the current rate method. Under this method, the income statement and the cash flows for each period have been translated into U.S. dollars using the average rate of the reporting period, and assets and liabilities have been translated using the exchange rate at the end of the period. All resulting exchange differences are reported in the cumulative translation adjustment account as a separate component of stockholders’ equity.
c.	Principles of consolidation.
	The unaudited consolidated statements include the accounts of the Company and its wholly owned subsidiaries, ATGI, ATCI and ATBI. All inter-company transactions and balances were eliminated.
d.	Use of Estimates.
	The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expense during the period. Actual results could differ from those estimates.
e.	Loss per share.
	Basic loss per share (“EPS”) is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding during the period, excluding the effects of any potentially dilutive securities. Diluted EPS gives effect to all dilutive potential of shares of common stock outstanding during the period including stock options or warrants, using the treasury stock method (by using the average stock price for the period to determine the number of shares assumed to be purchased from the exercise of stock options or warrants), and convertible debt or convertible preferred stock, using the if-converted method. EPS excludes all potential dilutive shares of common stock if their effect is anti-dilutive. There were no dilutive securities at September 30, 2015.

8

W&E Source Corp. and Subsidiaries
(Formerly News of China, Inc.)
Notes to Consolidated Financial Statements
For the Three months Ended September 30, 2015 and 2014

f.	Revenue recognition.
	The Company recognizes revenue when it is realized or realizable and earned. The Company considers revenue realized or realizable and earned when it has persuasive evidence of an arrangement, delivery has occurred, the sales price is fixed or determinable, and collectability is reasonably assured. Revenue, which primarily consists of commission fees from air ticketing and hotel booking operations, is recognized as tickets and hotels are booked, and is recorded on a net basis (that is, the amount billed to a customer less the amount paid to a supplier) as the Company acts as an agent in these transactions.
g.	Cash and cash equivalents.
	The Company includes in cash and cash equivalents all short-term, highly liquid investments that mature within three months or less of their acquisition date. Cash equivalents consist principally of investments in interest-bearing demand deposit accounts and liquidity funds with financial institutions and are stated at cost, which approximates fair value. As of September 30, 2015, we have no cash equivalents.
h.	Equipment.
	Equipment is stated at cost and depreciated using the straight-line method over the estimated useful life of the asset. The estimated useful lives of our property and equipment are generally three years.
i.	Income taxes.
	Deferred tax assets and liabilities are recognized for future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases. In addition, the Company recognizes future tax benefits, such as carry forwards, to the extent that realization of such benefits is more likely than not and that a valuation allowance is provided when it is more likely than not that some portion of the deferred tax asset will not be realized. Company’s net operating losses carry forwards are subject to Section 382 limitation.
j.	Recently issued accounting pronouncements.
	The Company does not expect that any recently issued accounting pronouncement will have a significant impact on the results of operations, financial position, or cash flows of the Company.
k.	Going Concern.
	As reflected in the accompanying financial statements, the Company has an accumulated deficit of $1,034,307, and a net loss for the quarters ended September 30, 2015 and 2014 of $10,784 and $18,927, respectively. The Company currently has business activities to generate funds for its own operations, however, has not yet achieved profitable operations. These factors raise substantial doubt about our ability to continue as a going concern. The Company’s ability to continue as a going concern is dependent on its ability to raise additional capital and implement its business plan. These financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.
	Management believes that actions presently being taken to obtain additional funding and implement its strategic plans provide the opportunity for the Company to continue as a going concern.

9

W&E Source Corp. and Subsidiaries
(Formerly News of China, Inc.)
Notes to Consolidated Financial Statements
For the Three months Ended September 30, 2015 and 2014

Note 4 - Accounts Payable and Accrued Liabilities

Accounts Payable and Accrued Liabilities of $35,660 as of September 30, 2015 consists of a payment for vendor (hotel) of $553, various vendors of $9,119 in professional fees and previous director of $25,988.

Note 5 – Related Parties

Mrs. Hong Ba serves as the Chief Executive Officer and Director of the Company. Mr. Feng Li, the husband of Mrs. Hong Ba, is the owner of the Canada Airchn Financial Inc. (“CAFI”). Mr. Chen Xi Shi is the former Chief Financial Officer and Director of the Company. The shareholders make advances to the Company from time to time for the Company’s operations. These advances are due on demand and non-interest bearing.

During three months ended September 30, 2015, no shares of the Company’s capital stock were issued. During the last fiscal year ended June 30, 2015, on October 26, 2014, the Company issued 14,962,200 common shares of the Company to settle the debts payable of $149,622 to related parties at $0.01 per share for operations on behalf of ATCI, ATGI and ATBI.

During the three months ended September 30, 2015, a Company owned by Feng Li, the husband of Mrs. Hong Ba, our CEO, charged the Company $1,833(2014 - $2,203) in rent and $3,597 (June 30, 2015 - $1,921) is outstanding.

Note 6 – Income Taxes

United States of America

The Company and its subsidiary are subject to income taxes on an entity basis on income arising in, or derived from, the tax jurisdiction in which they operate.

Canada

The Company’s subsidiary, Airchn Travel (Canada) Inc. is incorporated in British Columbia in Canada. It is subject to income taxes on income arising in, or derived from, the tax jurisdiction in British Columbia it operates. The basic federal rate of Part I tax is 38% of taxable income, 28% after federal tax abatement. After the general tax reduction, the net federal tax rate is 18% effective January 1, 2010; 16.5% effective January 1, 2011; 15% effective January 1, 2012. The provincial and territorial lower and higher tax rates in British Columbia are 2.5% and 10%, respectively. Other than income tax, Airchn Travel (Canada) Inc. is GST registrants who make taxable services in British Columbia and collect tax at the 5% GST rate on taxable services.

People’s Republic of China

The Company’s subsidiary, Airchn Travel (Beijing) Inc. is incorporated in Beijing in China. It is subject to PRC tax laws. Prior to January 1, 2008, PRC enterprise income tax (“EIT”) was generally assessed at the rate of 33% of taxable income. In March 2007, a new enterprise income tax law (the “New EIT Law”) in the PRC was enacted which was effective on January 1, 2008. The New EIT Law generally applies a uniform 25% EIT rate to both foreign invested enterprises and domestic enterprises.

For the reporting periods, the components of loss before income taxes were comprised of the following:

10

W&E Source Corp. and Subsidiaries
(Formerly News of China, Inc.)
Notes to Consolidated Financial Statements
For the Three months Ended September 30, 2015 and 2014

		For the Quarter Ended			For the Year Ended
		September 30, 2015			June 30, 2015
United States of America	$	(7,436	)	$	(34,880	)
Canada		(3,324	)		(39,433	)
People's Republic of China		(24	)		(6,828	)
Loss before income taxes	$	(10,784	)	$	(81,141	)

The components of deferred taxes assets at September 30, 2015 and June 30, 2015:

		2015			2015
USA net operating losses	$	2,528		$	11,859
Canada net operating losses		449			5,323
PRC net operating losses		7			1,855
Deferred tax assets, net		2,984			19,037
Less: valuation allowance		(2,984	)		(19,037	)
Deferred tax assets, net	$	-		$	-

As of September 30, 2015, the Company has an accumulated deficit of $1,034,307 that can be carried forward to offset future net profit for income tax purposes. All tax penalties and interest are expensed as incurred. For the years ended September 30, 2015 and June 30, 2015, there were no tax penalties or interest.

Note 7 – Commitment and Contingencies

The Company leases office spaces for different terms under long-term, non-cancelable operating lease agreements. Monthly rent ranges from $780 to $8,151 and deposits range from $4,000 to $16,302. The leases expire at various dates through 2016 and provide for renewal options ranging from twenty-six months to three years. In the normal course of business, it is expected that these leases will be renewed or replaced by leases on other properties.

On May 30, 2014, the Company assigned the lease agreement dated November 1, 2011 to Meixi Travel LLC effective on August 1, 2014.

The following is a schedule by year of future minimum rental payments required under the operating lease agreements:

Year Ending June 30		Amounts
2015		9,600
2016		9,600
2017		9,600
2018 and thereafter		-
Total	$	28,800

For each of the quarters ended September 30, 2015 and 2014, the Company recorded a rent expense of $2,400 and $4,074, respectively.

11

W&E Source Corp. and Subsidiaries
(Formerly News of China, Inc.)
Notes to Consolidated Financial Statements
For the Three months Ended September 30, 2015 and 2014

Note 8 – Common Stock

On January 23, 2012, the Company entered into a subscription agreement with the significant shareholder Hong Ba, for the sale of 22,000,000 common shares for $630,000 from cash received and expense paid on behalf by Hong Ba. Subsequent to the sale, Hong Ba owns 22,000,000 common shares which represent 45.9% of the issued and outstanding shares of the Company.

The Share Purchase Agreement with Mr. Wu Hao was not completed in January 2013, and both the Company and Mr. Wu Hao agreed to terminate the agreement entered on December 15, 2012. On October 26, 2014, the Company issued 15,538,300 common shares of the Company to settle the debts payable of $155,383 to related parties at $0.01 per share.

The Company is authorized to issue 500,000,000 shares of common stock with par value of $0.0001. As of September 30, 2015 and June 30, 2015, 63,438,300 and 63,438,300 shares of common stock were issued and outstanding, respectively.

12

ITEM 2 MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward Looking Statements

This report contains forward-looking statements. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “expects”, “plans”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in the section entitled “Risk Factors”, that may cause our company’s or our industry’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

Our financial statements are stated in United States dollars (US$) and are prepared in accordance with United States generally accepted accounting principles.

In this quarterly report, unless otherwise specified, all references to “common shares” refer to the common shares of our capital stock.

As used in this quarterly report, the terms “we”, “us”, “our”, “W&E Source Corp.”, “the Company” means W&E Source Corp., unless otherwise indicated.

Corporate Overview

The Company has identified the global tourism market as its first investment target. As it currently exists, the tourism industry is fragmented into various geographic regions. We believe that approaching this industry from a global perspective is an emerging market with tremendous growth potential. We plan to set up and/or acquire offices in various regions of the world and through them, develop the local tourism industry and expand our local tourism market. Ultimately, we plan to unify and manage our regional offices and to market our global services through the internet.

We have set up three subsidiaries, Airchn Travel Global, Inc. in Seattle, Washington (“ATGI”) and Airchn Travel (Canada) Inc., in Vancouver, British Columbia in Canada (“ATCI”) and Airchn Travel (Beijing) Inc. in Beijing, China (“ATBI”). We plan to set up additional subsidiaries in Hong Kong, Macau, Taiwan, Japan and Korea in the near future. Our Beijing office has been closed as of June 30, 2015 due to lack of business and to reduce operating costs.

We are engaged in services such as airline and cruise ticketing, customized and packaged tours, travel blogs, travel magazines, sales of travel related merchandise, group hotel reservations, business travel arrangements, conference travel arrangements, car rental and admission ticket sale for local tourist attractions.

We will continue to explore other business growth opportunities, regardless of industry, in order to diversify our business operations and investments.

On January 17, 2012, the Company filed a Certificate of Amendment to its Certificate of Incorporation with the Secretary of State of Delaware to change its name from News of China, Inc. to W&E Source Corp. In connection the name change, our listing symbol on the OTCQB also changed from “NWCH” to “WESC.” Our new website which is currently under construction can be accessed at www.wescus.com. In addition, the Company also increased its

13

total authorized shares to 500,000,000 to anticipate future financing through the issuance of our equity or convertible debt to finance our business.

Results of Operations

The following summary of our results of operations should be read in conjunction with our unaudited financial statements for the quarters ended September 30, 2015 and 2014 contained in this Report.

Three Months Ended September 30, 2015 and 2014:

		Three Months Ended			Three Months Ended
		September 30,			September 30,
		2015			2014
Revenues	$	616		$	857
Expenses
General and administrative expenses		9,716			20,879
Foreign currency exchange gain (loss)		(1,684	)		1,095
Net loss	$	(10,784	)	$	(18,927	)

Revenues

We have generated total revenues of $616 from operations during the three months ended September 30, 2015 as compared to $857 for the same period in 2014, a decrease of $241 or 28%. The decrease was mainly due to the decrease in our travel business in the quarter ended September 30, 2015.

General and administrative expenses

General and administrative expenses for the three months ended September 30, 2015 decreased by $11,163 or 53%, compared with the same period in 2014 primarily because of decreased operating cost in rent and payroll expenses as discussed above.

Net loss

We had net losses of $10,784 and $18,927 for the three months ended September 30, 2015 and 2014, respectively, a decrease of $8,143 or 43%, and had an accumulated deficit of $1,034,307 since the inception of our business as at September 30, 2015. The decrease in net loss is mainly attributable to a decrease of general and administrative expenses, as partially offset by a decrease in sales revenue.

Liquidity and Capital Resources

Our financial conditions for the three month periods ended September 30, 2015 and 2014 are summarized as follows:

Working Capital

		September 30,			September 30,
		2015			2014
Current Assets	$	5,416		$	11,496
Current Liabilities		(80,076	)		(79,523	)
Working Capital	$	(74,660	)	$	(68,027	)

Our working capital deficit increased from the previous year and current assets were still insufficient to cover liabilities; the deficit magnitude increased by some $6,633 due to a significant increase of accounts payable for the last fiscal year end audit professional fees.

14

Cash Flows

		September 30,			September 30,
		2015			2014
Cash used in operating activities	$	(6,187	)	$	(20,950	)
Cash used in investing activities		-			-
Cash provided by (used in) financing activities		1,833			21,483
Cumulative translation adjustment		(2,238	)		(520	)
Net increase (decrease) in cash	$	(6,592	)	$	13

Cash Used in Operating Activities

For the three months ended September 30, 2015, our cash used in operating activities decreased by $14,763 or 70% from $20,950 compared with $6,187 for the three months in the current year. The decrease is mainly due to a decrease in general and administrative expenses and a decrease in accounts payable compared with the three months in last year.

Cash Used in Investing Activities

For the three months ended September 30, 2015, we have no cash investing activities as compared from the same period last year.

Cash Provided by Financing Activities

For the three months ended September 30, 2015, we received $1,833 from financing activities advanced from a related party, as compared with $21,483 advanced from related parties for operating expenses for the three months ended September 30, 2014.

Cash Requirements

Over the next 12-months, we anticipate that we will incur the following operating expenses:

Expense		Amount
General and administrative	$	50,000
Professional fees		25,000
Foreign currency exchange loss		10,000
Total	$	85,000

Our CEO, Hong Ba, has committed to providing our working capital requirements for the next 12 month.

Management believes that the Company will be able to raise sufficient capital to meet our working capital requirements for the next 12 month period. Management is currently seeking financing opportunities to meet our estimated funding requirements for the next 12 months primarily through private placements of our equity securities.

There is substantial doubt about our ability to continue as a going concern as the continuation of our business is dependent upon the continued financial support from our shareholders, our ability to obtain necessary equity financing to continue operations, and achieving a profitable level of operations. The issuance of additional equity securities by us could result in a significant dilution in the equity interests of our current stockholders. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities and future cash commitments.

In addition to the issues set out above regarding our ability to raise capital, global economies are currently undergoing a period of economic uncertainty related to the tightening of credit markets worldwide. This has resulted in numerous adverse effects, including unprecedented volatility in financial markets and stock prices, slower economic activity, decreased consumer confidence and commodity prices, reduced corporate profits and capital spending, increased unemployment, liquidity concerns and volatile but generally declining energy prices. We anticipate that the current economic conditions and the credit shortage will adversely impact our ability to raise financing. In addition, if the future economic environment continues to be less favorable than it has been in recent years, we may experience difficulty in completing our current business plan.

15

Transactions with related persons

During the three months ended September 30, 2015, a Company owned by Feng Li, the husband of Mrs. Hong Ba, our CEO, charged the Company $1,833 (2014 - $2,203) in rent and $3,597 (June 30, 2015 - $1,921) is outstanding.

Off Balance Sheet Arrangements

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to stockholders.

Recently Issued Accounting Standards

We continue to assess the effects of recently issued accounting standards. The impact of all recently adopted and issued accounting standards has been disclosed in the Footnotes to the financial statements.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not Applicable.

ITEM 4. CONTROLS AND PROCEDURES.

Disclosure Controls and Procedures

We maintain “disclosure controls and procedures”, as that term is defined in Rule 13a-15(e), promulgated by the Securities and Exchange Commission pursuant to the Securities Exchange Act of 1934, as amended. Disclosure controls and procedures include controls and procedures designed to ensure that information required to be disclosed in our company’s reports filed under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal accounting officer to allow timely decisions regarding required disclosure.

As required by paragraph (b) of Rules 13a-15 under the Securities Exchange Act of 1934, our management, with the participation of our principal executive officer and principal financial officer, evaluated our company’s disclosure controls and procedures as of the end of the period covered by this quarterly report on Form 10-Q. Based on this evaluation, our management concluded that as of the end of the period covered by this quarterly report on Form 10-Q, our disclosure controls and procedures were not effective due to the material weaknesses described in Management's annual report on internal control over financial reporting contained in our Annual Report on Form 10-K for the year ended June 30, 2015.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting during the three months ended September 30, 2015 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

16

PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

We know of no material, active or pending legal proceedings against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

ITEM 1A. RISK FACTORS

As of the date of this filing, there have been no material changes from the risk factors disclosed in Part I, Item 1A (Risk Factors) contained in our Annual Report on Form 10-K for the year ended June 30, 2015. We operate in a changing environment that involves numerous known and unknown risks and uncertainties that could materially affect out operations. The risks, uncertainties and other factors set forth in our Annual Report on Form 10-K for the year ended June 30, 2015 may cause our actual results, performances and achievements to be materially different from those expressed or implied by our forward-looking statements. If any of these risks or events occurs, our business, financial condition or results of operations may be adversely affected.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

None.

17

ITEM 6. EXHIBITS

(3)	Articles of Incorporation and By-laws
3.1	Articles of Incorporation (attached as an exhibit to our registration statement on Form SB-2 filed September 25, 2006)
3.2	By-Laws (attached as an exhibit to our registration statement on Form SB-2 filed September 25, 2006)
3.3	Certificate of Amendment to the Certificate of Incorporation filed on January 17, 2012. (attached as an exhibit to our Form 10-Q filed February 10, 2012)
(31)	Section 302 Certification
31.1*	Certification Statement of the Principal Executive Officer and Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
(32)	Section 906 Certification
32.1*	Certification Statement of the Principal Executive Officer and Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
(101)	Interactive Data Files
101.INS*	XBRL INSTANCE DOCUMENT
101.SCH*	XBRL TAXONOMY EXTENSION SCHEMA
101.CAL*	XBRL TAXONOMY EXTENSION CALCULATION LINKBASE
101.DEF*	XBRL TAXONOMY EXTENSION DEFINITION LINKBASE
101.LAB*	XBRL TAXONOMY EXTENSION LABEL LINKBASE
101.PRE*	XBRL TAXONOMY EXTENSION PRESENTATION LINKBASE

*filed herewith

18

SIGNATURES

Pursuant to the requirements 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.

W&E Source Corp.

 /s/ Hong Ba

 Hong Ba

 CEO and CFO

 Principal Executive Officer, Principal Financial Officer

 and Principal Accounting Officer

 Date: November 4, 2015

19

EX-31.1

Exhibit 31.1

Certification of Principal Executive Officer and Principal Financial Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
and Securities and Exchange Commission Release 34-46427

I, Hong Ba, certify that:

1. I have reviewed this quarterly report on Form 10-Q of W&E Source Corp.;

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. The registrant’s other certifying officer(s) and I are 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 Rules 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 our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our 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

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant's other certifying officers and 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 registrant's board of directors (or persons performing the equivalent functions):

a) all deficiencies and material weaknesses in the design or operation of internal control 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: November 4, 2015

/s/ Hong Ba

Hong Ba, Principal Executive Officer,

Principal Financial Officer and Principal

Accounting Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of W&E Source Corp. (the "Company") on Form 10-Q for the quarter ended September 30, 2015 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Hong Ba, certify, pursuant to 18 U.S.C. ss. 1350, as adopted pursuant to ss. 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: November 4, 2015

/s/ Hong Ba

Hong Ba

Principal Executive Officer, Principal

Financial Officer and Principal Accounting

Officer

XML

Accounts Payable and Accrued Liabilities

3 Months Ended

Sep. 30, 2015

Accounts Payable and Accrued Liabilities [Text Block]

Note 4 - Accounts Payable and Accrued Liabilities

Accounts Payable and Accrued Liabilities of $35,660 as of September 30, 2015 consists of a payment for vendor (hotel) of $553, various vendors of $9,119 in professional fees and previous director of $25,988.

XML

Summary of Significant Accounting Policies

3 Months Ended

Sep. 30, 2015

Summary of Significant Accounting Policies [Text Block]

Note 2 – Summary of Significant Accounting Policies

a.

Basis of presentation.

The Company prepares its financial statements in accordance with accounting principles generally accepted in the United States. This basis of accounting involves the application of accrual accounting and consequently, revenues and gains are recognized when earned, and expenses and losses are recognized when incurred. The financial statements are expressed in U.S. dollars. These unaudited financial statements should be read in conjunction with a reading of the financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended June 30, 2015, as filed with the U.S. Securities and Exchange Commission.

b.

Foreign currency translation.

ATCI's and ATBI’s functional currency for operations is the Canadian dollar and Chinese Yuan. However, the Company's reporting currency is in U.S. dollar. Therefore, the financial statements for all periods presented have been translated into U.S. dollar using the current rate method. Under this method, the income statement and the cash flows for each period have been translated into U.S. dollars using the average rate of the reporting period, and assets and liabilities have been translated using the exchange rate at the end of the period. All resulting exchange differences are reported in the cumulative translation adjustment account as a separate component of stockholders’ equity.

c.	Principles of consolidation.
	The unaudited consolidated statements include the accounts of the Company and its wholly owned subsidiaries, ATGI, ATCI and ATBI. All inter-company transactions and balances were eliminated.

d.

Use of Estimates.

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expense during the period. Actual results could differ from those estimates.

e.

Loss per share.

Basic loss per share (“EPS”) is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding during the period, excluding the effects of any potentially dilutive securities. Diluted EPS gives effect to all dilutive potential of shares of common stock outstanding during the period including stock options or warrants, using the treasury stock method (by using the average stock price for the period to determine the number of shares assumed to be purchased from the exercise of stock options or warrants), and convertible debt or convertible preferred stock, using the if-converted method. EPS excludes all potential dilutive shares of common stock if their effect is anti-dilutive. There were no dilutive securities at September 30, 2015.

f.

Revenue recognition.

The Company recognizes revenue when it is realized or realizable and earned. The Company considers revenue realized or realizable and earned when it has persuasive evidence of an arrangement, delivery has occurred, the sales price is fixed or determinable, and collectability is reasonably assured. Revenue, which primarily consists of commission fees from air ticketing and hotel booking operations, is recognized as tickets and hotels are booked, and is recorded on a net basis (that is, the amount billed to a customer less the amount paid to a supplier) as the Company acts as an agent in these transactions.

g.

Cash and cash equivalents.

The Company includes in cash and cash equivalents all short-term, highly liquid investments that mature within three months or less of their acquisition date. Cash equivalents consist principally of investments in interest-bearing demand deposit accounts and liquidity funds with financial institutions and are stated at cost, which approximates fair value. As of September 30, 2015, we have no cash equivalents.

h.	Equipment.
	Equipment is stated at cost and depreciated using the straight-line method over the estimated useful life of the asset. The estimated useful lives of our property and equipment are generally three years.

i.

Income taxes.

Deferred tax assets and liabilities are recognized for future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases. In addition, the Company recognizes future tax benefits, such as carry forwards, to the extent that realization of such benefits is more likely than not and that a valuation allowance is provided when it is more likely than not that some portion of the deferred tax asset will not be realized. Company’s net operating losses carry forwards are subject to Section 382 limitation.

j.	Recently issued accounting pronouncements.
	The Company does not expect that any recently issued accounting pronouncement will have a significant impact on the results of operations, financial position, or cash flows of the Company.

k.	Going Concern.
	As reflected in the accompanying financial statements, the Company has an accumulated deficit of $1,034,307, and a net loss for the quarters ended September 30, 2015 and 2014 of $10,784 and $18,927, respectively. The Company currently has business activities to generate funds for its own operations, however, has not yet achieved profitable operations. These factors raise substantial doubt about our ability to continue as a going concern. The Company’s ability to continue as a going concern is dependent on its ability to raise additional capital and implement its business plan. These financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.
	Management believes that actions presently being taken to obtain additional funding and implement its strategic plans provide the opportunity for the Company to continue as a going concern.

XML

Consolidated Balance Sheets - USD ($)	Sep. 30, 2015	Jun. 30, 2015
Current Assets
Cash	$ 4,301	$ 10,893
Accounts receivable	509	603
Advanced expense	606	0
Total current assets	5,416	11,496
Non-Current Assets
Prepayments/Deposits	11,240	12,009
Total non-current assets	11,240	12,009
TOTAL ASSETS	16,656	23,505
Current liabilities
Accounts payable and accrued liabilities	35,660	7,128
Wage payable and other payable	0	2,142
Advanced for share issuance	39,695	42,412
Advances from related parties and related party payables	3,597	27,841
Customer deposit	1,124	0
Total current liabilities	80,076	79,523
TOTAL LIABILITIES	80,076	79,523
Shareholders' equity (deficit)
Common stock, $0.0001 par value, 500,000,000 shares authorized, 63,438,300 shares issued and outstanding as of September 30, 2015 and June 30, 2015, respectively	6,344	6,344
Additional paid-in capital	957,055	957,055
Accumulated deficit	(1,034,307)	(1,023,523)
Accumulated other comprehensive income	7,488	4,106
Total shareholders' deficit	(63,420)	(56,018)
TOTAL LIABILITIES AND SHAREHOLDERS' DEFICIT	$ 16,656	$ 23,505

XML

Consolidated Statements of Changes in Shareholders Equity (Deficit) - USD ($)	Common Stock [Member]	Additional Paid-in Capital [Member]	Capital Stock [Member]	Accumulated Other Comprehensive Income [Member]	Accumulated Deficit [Member]	Total
Beginning Balance at Jun. 30, 2011	$ 2,590	$ 173,695		$ 1,677	$ (199,860)	$ (21,898)
Beginning Balance (Shares) at Jun. 30, 2011	25,900,000
Issue of common shares	$ 2,200	627,800				630,000
Issue of common shares (Shares)	22,000,000
Donated capital		1,731				1,731
Foreign currency translation adjustment				(1,277)		(1,277)
Net loss					(305,309)	(305,309)
Ending Balance at Jun. 30, 2012	$ 4,790	803,226		400	(505,169)	303,247
Ending Balance (Shares) at Jun. 30, 2012	47,900,000
Capital stock			$ (301,000)			(301,000)
Capital stock			$ 301,000			301,000
Foreign currency translation adjustment				3,151		3,151
Net loss					(261,213)	(261,213)
Ending Balance at Jun. 30, 2013	$ 4,790	803,226		3,551	(766,382)	45,185
Ending Balance (Shares) at Jun. 30, 2013	47,900,000
Foreign currency translation adjustment				(4,211)		(4,211)
Net loss					(176,000)	(176,000)
Ending Balance at Jun. 30, 2014	$ 4,790	803,226		(660)	(942,382)	(135,026)
Ending Balance (Shares) at Jun. 30, 2014	47,900,000
Capital stock	$ 1,554	153,829				155,383
Capital stock (Shares)	15,538,300
Foreign currency translation adjustment				4,766		4,766
Net loss					(81,141)	(81,141)
Ending Balance at Jun. 30, 2015	$ 6,344	957,055		4,106	(1,023,523)	(56,018)
Ending Balance (Shares) at Jun. 30, 2015	63,438,300
Foreign currency translation adjustment				3,382		3,382
Net loss					(10,784)	(10,784)
Ending Balance at Sep. 30, 2015	$ 6,344	$ 957,055		$ 7,488	$ (1,034,307)	$ (63,420)
Ending Balance (Shares) at Sep. 30, 2015	63,438,300

XML

Commitment and Contingencies (Narrative) (Details)	3 Months Ended
	Sep. 30, 2015 USD ($)
Commitment And Contingencies 1	$ 780
Commitment And Contingencies 2	8,151
Commitment And Contingencies 3	4,000
Commitment And Contingencies 4	16,302
Commitment And Contingencies 5	2,400
Commitment And Contingencies 6	$ 4,074

XML

Schedule of Components of Loss Before Income Taxes (Details)	3 Months Ended
	Sep. 30, 2015 USD ($)
Income Taxes Schedule Of Components Of Loss Before Income Taxes 1	$ (7,436)
Income Taxes Schedule Of Components Of Loss Before Income Taxes 2	(34,880)
Income Taxes Schedule Of Components Of Loss Before Income Taxes 3	(3,324)
Income Taxes Schedule Of Components Of Loss Before Income Taxes 4	(39,433)
Income Taxes Schedule Of Components Of Loss Before Income Taxes 5	(24)
Income Taxes Schedule Of Components Of Loss Before Income Taxes 6	(6,828)
Income Taxes Schedule Of Components Of Loss Before Income Taxes 7	(10,784)
Income Taxes Schedule Of Components Of Loss Before Income Taxes 8	$ (81,141)

XML

Organization, Nature of Operations and Basis of Presentation

3 Months Ended

Sep. 30, 2015

Organization, Nature of Operations and Basis of Presentation [Text Block]

Note 1 – Organization, Nature of Operations and Basis of Presentation

W&E Source Corp. (“the Company”) was incorporated in the State of Delaware on October 11, 2005 and is based in Montréal, Québec, Canada. The Company is providing air ticket reservations, hotel reservations and other travel related services.

On August 25, 2011, the Company incorporated a company called Airchn Travel Global, Inc. (“ATGI”) in the State of Washington, USA. ATGI is a wholly owned subsidiary of the Company. ATGI focuses on a business segment of travel businesses which includes air ticket reservations, hotel reservations and other travel services.

On October 4, 2011, the Company incorporated a company called Airchn Travel (Canada) Inc. (“ATCI”) in the Province of British Columbia, Canada. ATCI is a wholly owned subsidiary of ATGI. ATCI has a similar business segment as ATGI.

In January 2012, the Company changed its name from News of China, Inc. to W&E Source Corp. and increased its authorized shares to 500,000,000 shares. As a result of the name change, the Company’s listing symbol on OTCQB is also changed to WESC.

During the period ended March 31, 2012, the Company incorporated a company named Airchn Travel (Beijing) Inc. (“ATBI”) in Beijing, China. ATBI is also a wholly owned subsidiary of ATGI. ATBI has a similar business segment as ATGI.

On December 15, 2012, Airchin Travel (Beijing) Inc., a wholly owned subsidiary of W&E Source Corp. (the “Company”), entered into the Share Purchase Agreement (the “Agreement”) with Mr. Wu Hao (the “Seller”), a majority shareholder of Chengdu Baopiao Internet Co., Ltd. (“Baopiao”), to acquire part of his ownership in Baopiao which equals 51% of all issued and outstanding stock of Baopiao (the “Shares”).

The Company will pay for the aggregate purchase price of RMB2,550,000 for the Shares in cash and by assuming the Seller’s debt to Baopiao in the amount of RMB1,800,000 (approximately US$289,000) (the “Debt”). According to the terms of the Agreement, the Company will assume the Debt upon execution of the Agreement and pay the Seller the remaining RMB750,000 of the purchase price within 20 days from the execution of the Agreement. Also at execution, the Company will paid Baopiao RMB200,000 as repayment of the Debt and satisfy the remaining Debt of RMB1,600,000 within 20 day from the execution of the Agreement.

Also pursuant to the Agreement, the Seller will provide guaranties that other than the information including financial statements provided to the Company, Baopiao does not have any other debts, and no third party has any rights or liens on the assets of Baopiao. The Seller and Baopiao will also indemnify the Company against any damages, liabilities, losses and expenses, which the Company may sustain or suffer due to any breach of the guaranties made by the Seller or Baopiao.

Baopiao has obtained the necessary shareholder approval for the transfer of the Shares and will register the transfer of the Shares with the applicable State Administration for Industry and Commerce within three days from the date of the Agreement.

In connection with the Agreement, the Company also entered into an agreement with the Seller and Baopiao that as an incentive for the management team of Baopiao, the Company will reserve up to 26 million shares of its common stock for issuance to the Baopiao employees upon achievement of certain milestones over the next three years.

The Share Purchase Agreement with Mr. Wu Hao was not completed in January 2013, and both the Company and Mr. Wu Hao agreed to terminate the agreement entered on December 15, 2012.

On October 26, 2014, the Company issued 15,538,300 common shares of the Company to settle the debts payable of $155,383 to related parties at $0.01 per share.

XML

Consolidated Balance Sheets (Paranthetical) - $ / shares	Sep. 30, 2015	Jun. 30, 2015
Common Stock, Par Value Per Share	$ 0.0001	$ 0.0001
Common Stock, Shares Authorized	500,000,000	500,000,000
Common Stock, Shares, Issued	63,438,300	63,438,300
Common Stock, Shares, Outstanding	63,438,300	63,438,300

XML

Organization, Nature of Operations and Basis of Presentation (Narrative) (Details) - 3 months ended Sep. 30, 2015	USD ($) d $ / shares shares	CNY (¥) d shares
Organization, Nature Of Operations And Basis Of Presentation 1 | shares	500,000,000	500,000,000
Organization, Nature Of Operations And Basis Of Presentation 2	51.00%	51.00%
Organization, Nature Of Operations And Basis Of Presentation 3		¥ 2,550,000
Organization, Nature Of Operations And Basis Of Presentation 4		1,800,000
Organization, Nature Of Operations And Basis Of Presentation 5 | $	$ 289,000
Organization, Nature Of Operations And Basis Of Presentation 6		¥ 750,000
Organization, Nature Of Operations And Basis Of Presentation 7 | d	20	20
Organization, Nature Of Operations And Basis Of Presentation 8		¥ 200,000
Organization, Nature Of Operations And Basis Of Presentation 9		¥ 1,600,000
Organization, Nature Of Operations And Basis Of Presentation 10 | d	20	20
Organization, Nature Of Operations And Basis Of Presentation 11 | shares	26,000,000	26,000,000
Organization, Nature Of Operations And Basis Of Presentation 12 | shares	15,538,300	15,538,300
Organization, Nature Of Operations And Basis Of Presentation 13 | $	$ 155,383
Organization, Nature Of Operations And Basis Of Presentation 14 | $ / shares	$ 0.01

XML

Document and Entity Information - shares	3 Months Ended
	Sep. 30, 2015	Oct. 30, 2015
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2015
Trading Symbol	wesc
Entity Registrant Name	W&E Source Corp.
Entity Central Index Key	0001368275
Current Fiscal Year End Date	--06-30
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		63,438,300
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well Known Seasoned Issuer	No
Document Fiscal Year Focus	2016
Document Fiscal Period Focus	Q1

XML

Summary of Significant Accounting Policies (Narrative) (Details)	3 Months Ended
	Sep. 30, 2015 USD ($)
Summary Of Significant Accounting Policies 1	$ 1,034,307
Summary Of Significant Accounting Policies 2	10,784
Summary Of Significant Accounting Policies 3	$ 18,927

XML

Condensed Consolidated Statements of Income and Comprehensive Income - USD ($)	3 Months Ended
	Sep. 30, 2015	Sep. 30, 2014
Net revenues	$ 616	$ 857
Gross profit	616	857
Operating expenses
General and administrative expenses	9,716	20,879
Total operating expenses	9,716	20,879
Operating Loss	(9,100)	(20,022)
Other Income (expense)
Foreign currency exchange (loss) gain	(1,684)	1,095
Total other income (expense)	(1,684)	1,095
Net loss	(10,784)	(18,927)
Other comprehensive income (loss)
Cumulative foreign currency Translation adjustment	3,382	667
Comprehensive loss	$ (7,402)	$ (18,260)
Weighted average number of shares outstanding - basic and diluted	63,483,300	47,900,000
Loss per share - basic and diluted	$ 0.00	$ 0.00

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Commitment and Contingencies

3 Months Ended

Sep. 30, 2015

Commitment and Contingencies [Text Block]

Note 7 – Commitment and Contingencies

The Company leases office spaces for different terms under long-term, non-cancelable operating lease agreements. Monthly rent ranges from $780 to $8,151 and deposits range from $4,000 to $16,302. The leases expire at various dates through 2016 and provide for renewal options ranging from twenty-six months to three years. In the normal course of business, it is expected that these leases will be renewed or replaced by leases on other properties.

On May 30, 2014, the Company assigned the lease agreement dated November 1, 2011 to Meixi Travel LLC effective on August 1, 2014.

The following is a schedule by year of future minimum rental payments required under the operating lease agreements:

Year Ending June 30		Amounts
2015		9,600
2016		9,600
2017		9,600
2018 and thereafter		-
Total	$	28,800

For each of the quarters ended September 30, 2015 and 2014, the Company recorded a rent expense of $2,400 and $4,074, respectively.

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Income Taxes

3 Months Ended

Sep. 30, 2015

Income Taxes [Text Block]

Note 6 – Income Taxes

United States of America

The Company and its subsidiary are subject to income taxes on an entity basis on income arising in, or derived from, the tax jurisdiction in which they operate.

Canada

The Company’s subsidiary, Airchn Travel (Canada) Inc. is incorporated in British Columbia in Canada. It is subject to income taxes on income arising in, or derived from, the tax jurisdiction in British Columbia it operates. The basic federal rate of Part I tax is 38% of taxable income, 28% after federal tax abatement. After the general tax reduction, the net federal tax rate is 18% effective January 1, 2010; 16.5% effective January 1, 2011; 15% effective January 1, 2012. The provincial and territorial lower and higher tax rates in British Columbia are 2.5% and 10%, respectively. Other than income tax, Airchn Travel (Canada) Inc. is GST registrants who make taxable services in British Columbia and collect tax at the 5% GST rate on taxable services.

People’s Republic of China

The Company’s subsidiary, Airchn Travel (Beijing) Inc. is incorporated in Beijing in China. It is subject to PRC tax laws. Prior to January 1, 2008, PRC enterprise income tax (“EIT”) was generally assessed at the rate of 33% of taxable income. In March 2007, a new enterprise income tax law (the “New EIT Law”) in the PRC was enacted which was effective on January 1, 2008. The New EIT Law generally applies a uniform 25% EIT rate to both foreign invested enterprises and domestic enterprises.

For the reporting periods, the components of loss before income taxes were comprised of the following:

		For the Quarter Ended			For the Year Ended
		September 30, 2015			June 30, 2015
United States of America	$	(7,436	)	$	(34,880	)
Canada		(3,324	)		(39,433	)
People's Republic of China		(24	)		(6,828	)
Loss before income taxes	$	(10,784	)	$	(81,141	)

The components of deferred taxes assets at September 30, 2015 and June 30, 2015:

		2015			2015
USA net operating losses	$	2,528		$	11,859
Canada net operating losses		449			5,323
PRC net operating losses		7			1,855
Deferred tax assets, net		2,984			19,037
Less: valuation allowance		(2,984	)		(19,037	)
Deferred tax assets, net	$	-		$	-

As of September 30, 2015, the Company has an accumulated deficit of $1,034,307 that can be carried forward to offset future net profit for income tax purposes. All tax penalties and interest are expensed as incurred. For the years ended September 30, 2015 and June 30, 2015, there were no tax penalties or interest.

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Common Stock (Narrative) (Details)	3 Months Ended
	Sep. 30, 2015 USD ($) $ / shares shares
Common Stock 1	22,000,000
Common Stock 2 | $	$ 630,000
Common Stock 3	22,000,000
Common Stock 4	45.90%
Common Stock 5	15,538,300
Common Stock 6 | $	$ 155,383
Common Stock 7 | $ / shares	$ 0.01
Common Stock 8	500,000,000
Common Stock 9 | $	$ 0.0001
Common Stock 10	63,438,300
Common Stock 11	63,438,300

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Accounts Payable and Accrued Liabilities (Narrative) (Details)	3 Months Ended
	Sep. 30, 2015 USD ($)
Accounts Payable And Accrued Liabilities 1	$ 35,660
Accounts Payable And Accrued Liabilities 2	553
Accounts Payable And Accrued Liabilities 3	9,119
Accounts Payable And Accrued Liabilities 4	$ 25,988

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Income Taxes (Tables)

3 Months Ended

Sep. 30, 2015

Schedule of Components of Loss Before Income Taxes [Table Text Block]

		For the Quarter Ended			For the Year Ended
		September 30, 2015			June 30, 2015
United States of America	$	(7,436	)	$	(34,880	)
Canada		(3,324	)		(39,433	)
People's Republic of China		(24	)		(6,828	)
Loss before income taxes	$	(10,784	)	$	(81,141	)

Schedule of Deferred Tax Assets and Liabilities [Table Text Block]

		2015			2015
USA net operating losses	$	2,528		$	11,859
Canada net operating losses		449			5,323
PRC net operating losses		7			1,855
Deferred tax assets, net		2,984			19,037
Less: valuation allowance		(2,984	)		(19,037	)
Deferred tax assets, net	$	-		$	-

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Common Stock

3 Months Ended

Sep. 30, 2015

Common Stock [Text Block]

Note 8 – Common Stock

On January 23, 2012, the Company entered into a subscription agreement with the significant shareholder Hong Ba, for the sale of 22,000,000 common shares for $630,000 from cash received and expense paid on behalf by Hong Ba. Subsequent to the sale, Hong Ba owns 22,000,000 common shares which represent 45.9% of the issued and outstanding shares of the Company.

The Share Purchase Agreement with Mr. Wu Hao was not completed in January 2013, and both the Company and Mr. Wu Hao agreed to terminate the agreement entered on December 15, 2012. On October 26, 2014, the Company issued 15,538,300 common shares of the Company to settle the debts payable of $155,383 to related parties at $0.01 per share.

The Company is authorized to issue 500,000,000 shares of common stock with par value of $0.0001. As of September 30, 2015 and June 30, 2015, 63,438,300 and 63,438,300 shares of common stock were issued and outstanding, respectively.

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Summary of Significant Accounting Policies (Policies)

3 Months Ended

Sep. 30, 2015

Basis of presentation [Policy Text Block]

a.

Basis of presentation.

The Company prepares its financial statements in accordance with accounting principles generally accepted in the United States. This basis of accounting involves the application of accrual accounting and consequently, revenues and gains are recognized when earned, and expenses and losses are recognized when incurred. The financial statements are expressed in U.S. dollars. These unaudited financial statements should be read in conjunction with a reading of the financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended June 30, 2015, as filed with the U.S. Securities and Exchange Commission.

Foreign currency translation [Policy Text Block]

b.

Foreign currency translation.

ATCI's and ATBI’s functional currency for operations is the Canadian dollar and Chinese Yuan. However, the Company's reporting currency is in U.S. dollar. Therefore, the financial statements for all periods presented have been translated into U.S. dollar using the current rate method. Under this method, the income statement and the cash flows for each period have been translated into U.S. dollars using the average rate of the reporting period, and assets and liabilities have been translated using the exchange rate at the end of the period. All resulting exchange differences are reported in the cumulative translation adjustment account as a separate component of stockholders’ equity.

Principles of consolidation [Policy Text Block]

c.	Principles of consolidation.
	The unaudited consolidated statements include the accounts of the Company and its wholly owned subsidiaries, ATGI, ATCI and ATBI. All inter-company transactions and balances were eliminated.

Use of Estimates [Policy Text Block]

d.

Use of Estimates.

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expense during the period. Actual results could differ from those estimates.

Loss per share [Policy Text Block]

e.

Loss per share.

Basic loss per share (“EPS”) is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding during the period, excluding the effects of any potentially dilutive securities. Diluted EPS gives effect to all dilutive potential of shares of common stock outstanding during the period including stock options or warrants, using the treasury stock method (by using the average stock price for the period to determine the number of shares assumed to be purchased from the exercise of stock options or warrants), and convertible debt or convertible preferred stock, using the if-converted method. EPS excludes all potential dilutive shares of common stock if their effect is anti-dilutive. There were no dilutive securities at September 30, 2015.

Revenue recognition [Policy Text Block]

f.

Revenue recognition.

The Company recognizes revenue when it is realized or realizable and earned. The Company considers revenue realized or realizable and earned when it has persuasive evidence of an arrangement, delivery has occurred, the sales price is fixed or determinable, and collectability is reasonably assured. Revenue, which primarily consists of commission fees from air ticketing and hotel booking operations, is recognized as tickets and hotels are booked, and is recorded on a net basis (that is, the amount billed to a customer less the amount paid to a supplier) as the Company acts as an agent in these transactions.

Cash and cash equivalents [Policy Text Block]

g.

Cash and cash equivalents.

The Company includes in cash and cash equivalents all short-term, highly liquid investments that mature within three months or less of their acquisition date. Cash equivalents consist principally of investments in interest-bearing demand deposit accounts and liquidity funds with financial institutions and are stated at cost, which approximates fair value. As of September 30, 2015, we have no cash equivalents.

Equipment [Policy Text Block]

h.	Equipment.
	Equipment is stated at cost and depreciated using the straight-line method over the estimated useful life of the asset. The estimated useful lives of our property and equipment are generally three years.

Income taxes [Policy Text Block]

i.

Income taxes.

Deferred tax assets and liabilities are recognized for future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases. In addition, the Company recognizes future tax benefits, such as carry forwards, to the extent that realization of such benefits is more likely than not and that a valuation allowance is provided when it is more likely than not that some portion of the deferred tax asset will not be realized. Company’s net operating losses carry forwards are subject to Section 382 limitation.

Recently issued accounting pronouncements [Policy Text Block]

j.	Recently issued accounting pronouncements.
	The Company does not expect that any recently issued accounting pronouncement will have a significant impact on the results of operations, financial position, or cash flows of the Company.

Going Concern [Policy Text Block]

k.	Going Concern.
	As reflected in the accompanying financial statements, the Company has an accumulated deficit of $1,034,307, and a net loss for the quarters ended September 30, 2015 and 2014 of $10,784 and $18,927, respectively. The Company currently has business activities to generate funds for its own operations, however, has not yet achieved profitable operations. These factors raise substantial doubt about our ability to continue as a going concern. The Company’s ability to continue as a going concern is dependent on its ability to raise additional capital and implement its business plan. These financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.
	Management believes that actions presently being taken to obtain additional funding and implement its strategic plans provide the opportunity for the Company to continue as a going concern.

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Commitment and Contingencies (Tables)

3 Months Ended

Sep. 30, 2015

Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block]

Year Ending June 30		Amounts
2015		9,600
2016		9,600
2017		9,600
2018 and thereafter		-
Total	$	28,800

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Income Taxes (Narrative) (Details)	3 Months Ended
	Sep. 30, 2015 USD ($)
Income Taxes 1	38.00%
Income Taxes 2	28.00%
Income Taxes 3	18.00%
Income Taxes 4	16.50%
Income Taxes 5	15.00%
Income Taxes 6	2.50%
Income Taxes 7	10.00%
Income Taxes 8	5.00%
Income Taxes 9	33.00%
Income Taxes 10	25.00%
Income Taxes 11	$ 1,034,307

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Schedule of Future Minimum Rental Payments for Operating Leases (Details)	3 Months Ended
	Sep. 30, 2015 USD ($)
Commitment And Contingencies Schedule Of Future Minimum Rental Payments For Operating Leases 1	$ 9,600
Commitment And Contingencies Schedule Of Future Minimum Rental Payments For Operating Leases 2	9,600
Commitment And Contingencies Schedule Of Future Minimum Rental Payments For Operating Leases 3	9,600
Commitment And Contingencies Schedule Of Future Minimum Rental Payments For Operating Leases 4	0
Commitment And Contingencies Schedule Of Future Minimum Rental Payments For Operating Leases 5	$ 28,800

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Consolidated Statements of Cash Flow - USD ($)	3 Months Ended
	Sep. 30, 2015	Sep. 30, 2014
Cash Flow from Operating Activities
Net loss	$ (10,784)	$ (18,927)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense	0	3,435
Foreign currency exchange loss	3,320	0
Change in operating assets and liabilities:
Decrease in accounts receivable	69	2,011
Decrease (increase) in prepaid expenses and deposits	76	0
Increase (decrease) in accounts payable and accrued liabilities	(14)	(7,519)
Increase (decrease) in customer deposits	1,146	50
Net cash sourced (used) in operating activities	(6,187)	(20,950)
Cash Flows from Investing Activities
Net cash sourced (used) in investing activities	0	0
Cash Flows from Financing Activities
Due to related party	1,833	21,483
Net cash provided (used) by financing activities	1,833	21,483
Cumulative translation adjustment	(2,238)	(520)
Net increase (decrease) in cash & cash equivalents for the year	(6,592)	13
Beginning of period	10,893	14,570
End of period	4,301	14,583
Supplemental cash flows information
Interest received	0	0
Interest paid	0	0
Income tax paid	$ 0	$ 0

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Related Parties

3 Months Ended

Sep. 30, 2015

Related Parties [Text Block]

Note 5 – Related Parties

Mrs. Hong Ba serves as the Chief Executive Officer and Director of the Company. Mr. Feng Li, the husband of Mrs. Hong Ba, is the owner of the Canada Airchn Financial Inc. (“CAFI”). Mr. Chen Xi Shi is the former Chief Financial Officer and Director of the Company. The shareholders make advances to the Company from time to time for the Company’s operations. These advances are due on demand and non-interest bearing.

During three months ended September 30, 2015, no shares of the Company’s capital stock were issued. During the last fiscal year ended June 30, 2015, on October 26, 2014, the Company issued 14,962,200 common shares of the Company to settle the debts payable of $149,622 to related parties at $0.01 per share for operations on behalf of ATCI, ATGI and ATBI.

During the three months ended September 30, 2015, a Company owned by Feng Li, the husband of Mrs. Hong Ba, our CEO, charged the Company $1,833 (2014 - $2,203) in rent and $3,597 (June 30, 2015 - $1,921) is outstanding.

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Related Parties (Narrative) (Details)	3 Months Ended
	Sep. 30, 2015 USD ($) $ / shares shares
Related Parties 1 | shares	14,962,200
Related Parties 2	$ 149,622
Related Parties 3 | $ / shares	$ 0.01
Related Parties 4	$ 1,833
Related Parties 5	2,203
Related Parties 6	3,597
Related Parties 7	$ 1,921