10-Q

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

FORM 10-Q

(Mark One)

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

For the quarterly period ended March 31, 2016

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 May 13, 2016.

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	14
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	17
ITEM 4. CONTROLS AND PROCEDURES.	18
PART II – OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.	18
ITEM 1A. RISK FACTORS	18
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	19
ITEM 3. DEFAULTS UPON SENIOR SECURITIES	19
ITEM 4. MINE SAFETY DISCLOSURES	19
ITEM 5. OTHER INFORMATION	19
ITEM 6. EXHIBITS	19
SIGNATURES	20

2

PART I—FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

1

 

  CANUSWA ACCOUNTING & TAX SERVICES INC.

16301 NE 8th Street, Suite 138, Bellevue, WA 98008 Tel: 425-516-7453

Review Engagement Report

Board of Directors and Shareholders
W&E Source Corp.
113 Barksdale Professional Center
Newark, DE 19711
USA

We have reviewed the balance sheet of W&E Source Corp. of Quarter three as of Mar. 31, 2016, and the related statement of operations, retained earnings, and cash flow for the quarter then ended. Our review was made in accordance with generally accepted standards established for review engagement and accordingly consisted primarily of enquiry, analytical procedures, discussion related to information supplied to us by the company. A review does not constitute an audit, and consequently, we do not express an audit opinion on these financial statements.

Based on our reviews, nothing has come to our attention that causes us to believe that these financial statements are not, in all material respects, in accordance with the US generally accepted accounting principles.

/s/ Canuswa Accounting & Tax services Inc.
May12,2016

2

W&E Source Corp. and Subsidiaries
(Formerly News of China Inc.)
Consolidated Balance Sheets
As of March 31, 2016 and June 30, 2015
(Unaudited)

		March 31, 2016			June 30, 2015
Assets
Current Assets
Cash	$	2,477		$	10,893
Accounts receivable		556			603
Advanced expense		-			-
Total current assets		3,033			11,496
Non-Current Assets
Prepayments/Deposits		11,550			12,009
Total non-current assets		11,550			12,009
TOTAL ASSETS	$	14,583		$	23,505
Liabilities and Shareholders’ Equity (Deficit)
Current liabilities
Accounts payable and accrued liabilities	$	26,998		$	7,128
Wage payable and other payable		-			2,142
Advanced for share issuance		59,700			42,412
Advances from related parties and related party payables		9,702			27,841
Total current liabilities		96,400			79,523
TOTAL LIABILITIES		96,400			79,523
Shareholders' equity (deficit)
Common stock, $0.00001 par value, 500,000,000 shares authorized, 63,438,300 shares issued and outstanding as of March 31, 2016 and June 30, 2015, respectively		6,344			6,344
Additional paid-in capital		957,055			957,055
Accumulated deficit		(1,051,772	)		(1,023,523	)
Accumulated other comprehensive income		6,556			4,106
Total shareholders’ deficit		(81,817	)		(56,018	)
TOTAL LIABILITIES AND SHAREHOLDERS’ DEFICIT	$	14,583		$	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.)
Consolidated Statements of Income and Comprehensive Income
For the Three and Nine Months Ended March 31, 2016 and 2015
(Unaudited)

		2016			2015			2016			2015
		Three Months			Three Months			Nine Months			Nine Months
Net revenues	$	391		$	3,435		$	2,955		$	5,191
Operating expenses
General and administrative expenses		11,821			18,051			28,835			65,839
Loss from operation		(11,430	)		(14,616	)		(25,880	)		(60,648	)
Other Income (expense)
Interest income		-			-			-			-
Foreign currency exchange (loss) gain		6,761			(3,314	)		(2,369	)		(5,420	)
Total other income (expense)	$	6,761		$	(3,314	)	$	(2,369	)	$	(5,420	)
Loss before income taxes	$	(4,669	)	$	(17,930	)	$	(28,249	)	$	(66,068	)
Net loss		(4,669	)		(17,930	)		(28,249	)		(66,068	)
Other comprehensive income (loss)
Cumulative foreign currency     Translation adjustment		(3.958	)		3,516			2,450			6,408
Comprehensive loss	$	(8,627	)	$	(14,414	)	$	(25,799	)	$	(59,660	)
Weighted average number of shares outstanding – basic and diluted		63,483,300			56,779,000			63,483,300			63,438,300
Loss per share – basic and diluted		(0.00	)		(0.00	)		(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 Nine Months Ended March 31, 2016 and 2015
(Unaudited)

		March 31, 2016			March 31, 2015
Cash Flow from Operating Activities
Net loss	$	(28,249	)	$	(66,068	)
Adjustments to reconcile net loss to net cash used in operating     activities:
Depreciation expense		-			7,995
Share issuance for the debt settlement		-			155,383
Foreign currency exchange gain		851			-
Change in operating assets and liabilities:
Decrease in accounts receivable		126			1,642
Decrease (increase) in prepaid expenses and deposits		73			-
Increase (decrease) in accounts payable and accrued liabilities		(8,084	)		(7,283	)
Increase (decrease) in customer deposits		-			-
Net cash sourced (used) in operating activities		(35,283	)		91,669
Cash Flows from Investing Activities
Net cash sourced (used) in investing activities		-			-
Cash Flows from Financing Activities
Proceed advanced for share issuance		17,869			33,546
Proceed advances from related party		9,761			29,121
Repayment of advances to related party		-			(155,383	)
Net cash provided (used) by financing activities		27,630			(92,716	)
Cumulative translation adjustment		(763	)		(1,706	)
Net increase (decrease) in cash & cash equivalents for period		(8,416	)		(2,753	)
Beginning of period		10,893			14,570
End of period	$	2,477		$	11,817
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 and Nine Months Ended March 31, 2016 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	-	-	-	-		2,450		-		2,450
Net Loss	-	-	-	-				(28,249	)	(28,249	)
Balance at March 31, 2016	63,438,300	6,344	957,055	-		6,556		(1,051,772	)	(81,817	)

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 and Nine months Ended March 31, 2016 and 2015

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, Airchn 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.

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.

7

W&E Source Corp. and Subsidiaries
(Formerly News of China, Inc.)
Notes to Consolidated Financial Statements
For the Three and Nine months Ended March 31, 2016 and 2015

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 March 31, 2016.

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.

8

W&E Source Corp. and Subsidiaries
(Formerly News of China, Inc.)
Notes to Consolidated Financial Statements
For the Three and Nine months Ended March 31, 2016 and 2015

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 March 31, 2016, 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 $1,051,772, and a net loss for the quarters ended March 31, 2016 and 2015 of $28,249 and $66,068, 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.

Note 3 - Recently Issued Accounting Pronouncements

In July 2015, the FASB issued ASU 2015-11, “Inventory (Topic 330): Simplifying the Measurement of Inventory”. The amendments in ASU 2015-11 require an entity to measure in scope inventory at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. Subsequent measurement is unchanged for inventory measured using LIFO or the retail inventory method. The amendments do not apply to inventory that is measured using last-in, first-out (LIFO) or the retail inventory method. The amendments apply to all other inventory, which includes inventory that is measured using first-in, first-out (FIFO) or average cost. The amendments in this ASU are effective for public business entities for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2016, and interim periods within fiscal years beginning after December 15, 2017. A reporting entity should apply the amendments prospectively with earlier application permitted as of the beginning of an interim or annual reporting period. The adoption of ASU 2015-11 is not expected to have a material impact on the Company’s consolidated financial statements.

9

W&E Source Corp. and Subsidiaries
(Formerly News of China, Inc.)
Notes to Consolidated Financial Statements
For the Three and Nine months Ended March 31, 2016 and 2015

In August 2015, the FASB issued ASU 2015-14, “Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date”. The amendments in ASU 2015-14 defer the effective date of ASU 2014-09 for all entities by one year. Public business entities, certain not-for-profit entities, and certain employee benefit plans should apply the guidance in ASU 2014-09 to annual reporting periods beginning after December 15, 2017, including interim reporting periods within that reporting period. Earlier application is permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period. The Company is currently in the process of evaluating the impact of the adoption on its consolidated financial statements.

In September 2015, the FASB issued ASU 2015-16, “Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments”. The amendments in ASU 2015-16 require that an acquirer recognize adjustments to estimated amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The amendments require that the acquirer record, in the same period’s financial statements, the effect on earnings of changes in depreciation, amortization, or other income effects, if any, as a result of the change to the estimated amounts, calculated as if the accounting had been completed at the acquisition date. The amendments also require an entity to present separately on the face of the income statement or disclose in the notes the portion of the amount recorded in current-period earnings by line item that would have been recorded in previous reporting periods if the adjustment to the estimated amounts had been recognized as of the acquisition date. The amendments in this ASU are effective for public business entities for fiscal years beginning after December 15, 2015, including interim periods within those fiscal years. The amendments should be applied prospectively to adjustments to provisional amounts that occur after the effective date with earlier application permitted for financial statements that have not been issued. The adoption of ASU 2015-16 is not expected to have a material impact on the Company’s consolidated financial statements.

In November 2015, the FASB issued ASU 2015-17, “Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes”. The amendments in ASU 2015-17 eliminates the current requirement for organizations to present deferred tax liabilities and assets as current and noncurrent in a classified balance sheet. Instead, organizations will be required to classify all deferred tax assets and liabilities as noncurrent. The amendments in this ASU are effective for public business entities for financial statements issued for annual periods beginning after December 15, 2016, and interim periods within those annual periods. The amendments may be applied prospectively to all deferred tax liabilities and assets or retrospectively to all periods presented. The Company is currently in the process of evaluating the impact of the adoption on its consolidated financial statements.

In January 2016, the FASB issued ASU 2016-01, “Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities”. The amendments in ASU 2016-01, among other things, requires equity investments (except those accounted for under the equity method of accounting, or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income; Requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes; Requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset (i.e., securities or loans and receivables); Eliminates the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost. The amendments in this ASU are effective for public companies for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The new guidance permits early adoption of the own credit provision. In addition, the new guidance permits early adoption of the provision that exempts private companies and not-for-profit organizations from having to disclose fair value information about financial instruments measured at amortized cost. The Company is currently in the process of evaluating the impact of the adoption on its consolidated financial statements.

In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842)”. Among other things, in the amendments in ASU 2016-02, lessees will be required to recognize the following for all leases (with the exception of short-term leases) at the commencement date: A lease liability, which is a lessee‘s obligation to make lease payments arising from a lease, measured on a discounted basis; and A right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. Under the new guidance, lessor accounting is largely unchanged. Certain targeted improvements were made to align, where necessary, lessor accounting with the lessee accounting model and Topic 606, Revenue from Contracts with Customers. The amendments in this ASU are effective for public business entities for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early application is permitted for all public business entities and all nonpublic business entities upon issuance. Lessees (for capital and operating leases) and lessors (for sales-type, direct financing, and operating leases) must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The modified retrospective approach would not require any transition accounting for leases that expired before the earliest comparative period presented. Lessees and lessors may not apply a full retrospective transition approach. The Company is currently in the process of evaluating the impact of the adoption on its consolidated financial statements.

10

W&E Source Corp. and Subsidiaries
(Formerly News of China, Inc.)
Notes to Consolidated Financial Statements
For the Three and Nine months Ended March 31, 2016 and 2015

In March 2016, the FASB issued ASU 2016-03, “Intangibles-Goodwill and Other (Topic 350); Business Combinations (Topic 805); Consolidation (Topic 810); Derivatives and Hedging (Topic 815): Effective Date and Transition Guidance”. The amendments in this ASU make the guidance in ASUs 2014-02, 2014-03, 2014-07, and 2014-18 effective immediately by removing their effective dates. The amendments also include transition provisions that provide that private companies are able to forgo a preferability assessment the first time they elect the accounting alternatives within the scope of this ASU. Any subsequent change to an accounting policy election requires justification that the change is preferable under Topic 250, Accounting Changes and Error Corrections. The amendments in this ASU also extend the transition guidance in ASUs 2014-02, 2014-03, 2014-07, and 2014-18 indefinitely. While this ASU extends transition guidance for Updates 2014-07 and 2014-18, there is no intention to change how transition is applied for those two ASUs. The Company is currently in the process of evaluating the impact of the adoption on its consolidated financial statements.

Note 4 - Accounts Payable and Accrued Liabilities

Accounts Payable and Accrued Liabilities of $26,998 as of March 31, 2016 consists of a payment for vendor (hotel) of $569, various vendors of $509 for operating expenses and previous director of $25,920.

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 the nine months ended March 31, 2016, 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 nine months ended March 31, 2016, a Company owned by Feng Li, the husband of Mrs. Hong Ba, our CEO, charged the Company $7,392 (2015 - $8,151) in rent and $9,702 (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.

11

W&E Source Corp. and Subsidiaries
(Formerly News of China, Inc.)
Notes to Consolidated Financial Statements
For the Three and Nine months Ended March 31, 2016 and 2015

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
		March 31, 2016			June 30, 2015
United States of America	$	(21,178	)	$	(34,880	)
Canada		(6,174	)		(39,433	)
People's Republic of China		(897	)		(6,828	)
Loss before income taxes	$	(28,249	)	$	(81,141	)

Note 6 – Income Taxes (continued)

The components of deferred taxes assets at March 31, 2016 and June 30, 2015:

		2016			2015
USA net operating losses	$	7,201		$	11,859
Canada net operating losses		772			5,323
PRC net operating losses		224			1,855
Deferred tax assets, net		8,197			19,037
Less: valuation allowance		(8,197	)		(19,037	)
Deferred tax assets, net	$	-		$	-

As of March 31, 2016, the Company has an accumulated deficit of $1,051,772 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 March 31, 2016 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 six years. In the normal course of business, it is expected that these leases will be renewed or replaced by leases on other properties.

12

W&E Source Corp. and Subsidiaries
(Formerly News of China, Inc.)
Notes to Consolidated Financial Statements
For the Three and Nine months Ended March 31, 2016 and 2015

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
2016		9,600
2017		9,600
2018		9,600
2019 and thereafter		-
Total	$	28,800

For each of the quarters ended March 31, 2016 and 2015, the Company recorded a rent expense of $7,392 and $8,101, respectively.

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 March 31, 2016 and June 30, 2015, 63,438,300 and 63,438,300 shares of common stock were issued and outstanding, respectively.

13

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

14

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 March 31, 2016 and 2015 contained in this Report.

Nine Months Ended March 31, 2016 and 2015:

		Nine Months Ended			Nine Months Ended
		March 31,			March 31,
		2016			2015
Revenues	$	2,955		$	5,191
Expenses
General and administrative expenses		(28,835	)		(65,839	)
Foreign currency exchange gain (loss)		(2,369	)		(5,420	)
Net loss	$	(28,249	)	$	(66,068	)

Revenues

We have generated total revenues of $2,955 from operations during the nine months ended March 31, 2016 as compared to $5,191 for the same period in 2015, a decrease of $2,236 or 43%. The decrease was mainly due to the decrease in our travel business in the nine months ended March 31, 2016.

General and administrative expenses

General and administrative expenses for the nine months ended March 31, 2016 decreased by $37,004 or 56%, compared with the same period in 2015 primarily because of decreased operating cost in rent and payroll expenses.

Net loss

We had net losses of $28,249 and $66,068 for the nine months ended March 31, 2016 and 2015, respectively, a decrease of $37,819 or 57%, and had an accumulated deficit of $1,051,772 since the inception of our business as at March 31, 2016. The decrease in net loss is mainly attributable to a decrease of general and administrative expenses, and partially offset by a decrease in sales revenue.

Three Months Ended March 31, 2016 and 2015:

		Three Months Ended			Three Months Ended
		March 31,			March 31,
		2016			2015
Revenues	$	391		$	3,435
Expenses
General and administrative expenses		(11,821	)		(18,051	)
Foreign currency exchange gain (loss)		6,761			(3,314	)
Net loss	$	(4,669	)	$	(17,930	)

Revenues

We have generated total revenues of $391 from operations during the three months ended March 31, 2016 as compared to $3,435 for the same period in 2015, a decrease of $3,044 or 89%. The decrease was mainly due to the decrease in our travel business in the quarter ended March 31, 2016.

15

General and administrative expenses

General and administrative expenses for the three months ended March 31, 2016 decreased by $6,230 or 35%, compared with the same period in 2015 primarily because of decreased operating cost in rent and payroll expenses.

Net loss

We had net losses of $4,669 and $17,930 for the three months ended March 31, 2016 and 2015, respectively, a decrease of $13,261 or 74%, and had an accumulated deficit of $1,051,772 since the inception of our business as at March 31, 2016. The decrease in net loss is mainly attributable to a decrease of general and administrative expenses, and partially offset by a decrease in sales revenue.

Liquidity and Capital Resources

Our financial conditions for the nine month periods ended March 31, 2016 and 2015 are summarized as follows:

Working Capital

		March 31,			March 31,
		2016			2015
Current Assets	$	3,033		$	12,569
Current Liabilities		(96,400	)		(63,714	)
Working Capital	$	(93,367	)	$	(51,145	)

Our working capital deficit increased from the previous year and current assets were still insufficient to cover liabilities; the deficit magnitude increased by some $42,222 due to a significant increase of accounts payable for the last fiscal year end tax return professional fees and advances of share issuance from an independent party.

Cash Flows

		March 31,			March 31,
		2016			2015
Cash used in operating activities	$	(35,283	)	$	91,669
Cash used in investing activities		-			-
Cash provided by (used in) financing activities		27,630			(92,716	)
Cumulative translation adjustment		(763	)		(1,706	)
Net increase (decrease) in cash	$	(8,416	)	$	(2,753	)

Cash Used in Operating Activities

For the nine months ended March 31, 2016, our cash used in operating activities decreased by $28,431 or 45% from $63,714 after share issuance of $155,383 for the debt settlement, compared with $35,283 for the nine months in the current year. The increase is mainly due to increase in accounts payable and accrued liabilities, despite a decrease in general and administrative expenses compared with the nine months in last year.

Cash Used in Investing Activities

For the nine months ended March 31, 2016, we have no cash investing activities as compared from the same period last year.

Cash Provided by Financing Activities

For the nine months ended March 31, 2016, we received $27,630 from financing activities advanced from a related party for an operating expense and an individual for advanced share issuance, as compared with $92,716 repayment to the advanced from related parties for operating expenses for the nine months ended March 31, 2015.

16

Cash Requirements

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

Expense		Amount
General and administrative	$	30,000
Professional fees		30,000
Foreign currency exchange loss		13,000
Total	$	78,000

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.

Transactions with related persons

During the nine months ended March 31, 2016, a Company owned by Feng Li, the husband of Mrs. Hong Ba, our CEO, charged the Company $7,392, (2015 – 6,231) in rent and $9,702 (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.

17

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 March 31, 2016 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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.

18

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

During the quarter ended March 31, 2016, the Company has agreed orally with a creditor that certain advances from the creditor shall be used to pay for shares of common stock of the Company at a future date. The price per share to be paid for such shares shall be the fair market value of the shares. The timing and amount of shares to be issued in such sale have not yet been determined. As of March 31, 2016, the aggregate amount of the advances to be used for such share purchases was $59,700, which amount may increase in the future.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

None.

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

19

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: May 13, 2016

20

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: May 13, 2016
	/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 March 31, 2016 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: May 13, 2016
	/s/ Hong Ba
	Hong Ba
	Principal Executive Officer, Principal
	Financial Officer and Principal Accounting
	Officer

XML

Document and Entity Information - shares	9 Months Ended
	Mar. 31, 2016	May. 13, 2016
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 31, 2016
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	Q3

XML

Consolidated Balance Sheets - USD ($)	Mar. 31, 2016	Jun. 30, 2015
Current Assets
Cash	$ 2,477	$ 10,893
Accounts receivable	556	603
Advanced expense	0	0
Total current assets	3,033	11,496
Non-Current Assets
Prepayments/Deposits	11,550	12,009
Total non-current assets	11,550	12,009
TOTAL ASSETS	14,583	23,505
Current liabilities
Accounts payable and accrued liabilities	26,998	7,128
Wage payable and other payable	0	2,142
Advanced for share issuance	59,700	42,412
Advances from related parties and related party payables	9,702	27,841
Total current liabilities	96,400	79,523
TOTAL LIABILITIES	96,400	79,523
Shareholders' equity (deficit)
Common stock, $0.00001 par value, 500,000,000 shares authorized, 63,438,300 shares issued and outstanding as of March 31, 2016 and June 30, 2015, respectively	6,344	6,344
Additional paid-in capital	957,055	957,055
Accumulated deficit	(1,051,772)	(1,023,523)
Accumulated other comprehensive income	6,556	4,106
Total shareholders' deficit	(81,817)	(56,018)
TOTAL LIABILITIES AND SHAREHOLDERS' DEFICIT	$ 14,583	$ 23,505

XML

Consolidated Balance Sheets (Paranthetical) - $ / shares	Mar. 31, 2016	Jun. 30, 2015
Common Stock, Par Value Per Share	$ 0.00001	$ 0.00001
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

Condensed Consolidated Statements of Income and Comprehensive Income - USD ($)	3 Months Ended		9 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2016	Mar. 31, 2015
Net revenues	$ 391	$ 3,435	$ 2,955	$ 5,191
Operating expenses
General and administrative expenses	11,821	18,051	28,835	65,839
Loss from operation	(11,430)	(14,616)	(25,880)	(60,648)
Other Income (expense)
Interest income	0	0	0	0
Foreign currency exchange (loss) gain	6,761	(3,314)	(2,369)	(5,420)
Total other income (expense)	6,761	(3,314)	(2,369)	(5,420)
Loss before income taxes	(4,669)	(17,930)	(28,249)	(66,068)
Net loss	(4,669)	(17,930)	(28,249)	(66,068)
Other comprehensive income (loss)
Cumulative foreign currency Translation adjustment	(3,958)	3,516	2,450	6,408
Comprehensive loss	$ (8,627)	$ (14,414)	$ (25,799)	$ (59,660)
Weighted average number of shares outstanding - basic and diluted	63,483,300	56,779,000	63,483,300	63,438,300
Loss per share - basic and diluted	$ 0.00	$ 0.00	$ 0.00	$ 0.00

XML

Consolidated Statements of Cash Flow - USD ($)	9 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Cash Flow from Operating Activities
Net loss	$ (28,249)	$ (66,068)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense	0	7,995
Share issuance for the debt settlement	0	155,383
Foreign currency exchange gain	851	0
Change in operating assets and liabilities:
Decrease in accounts receivable	126	1,642
Decrease (increase) in prepaid expenses and deposits	73	0
Increase (decrease) in accounts payable and accrued liabilities	(8,084)	(7,283)
Increase (decrease) in customer deposits	0	0
Net cash sourced (used) in operating activities	(35,283)	91,669
Cash Flows from Investing Activities
Net cash sourced (used) in investing activities	0	0
Cash Flows from Financing Activities
Proceed advanced for share issuance	17,869	33,546
Proceed advances from related party	9,761	29,121
Repayment of advances to related party	0	(155,383)
Net cash provided (used) by financing activities	27,630	(92,716)
Cumulative translation adjustment	(763)	(1,706)
Net increase (decrease) in cash & cash equivalents for period	(8,416)	(2,753)
Beginning of period	10,893	14,570
End of period	2,477	11,817
Supplemental cash flows information
Interest received	0	0
Interest paid	0	0
Income tax paid	$ 0	$ 0

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 (Shares)	15,538,300
Capital stock	$ 1,554	153,829				155,383
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				2,450		2,450
Net loss					(28,249)	(28,249)
Ending Balance at Mar. 31, 2016	$ 6,344	$ 957,055		$ 6,556	$ (1,051,772)	$ (81,817)
Ending Balance (Shares) at Mar. 31, 2016	63,438,300

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Organization, Nature of Operations and Basis of Presentation

9 Months Ended

Mar. 31, 2016

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, Airchn 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.

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Summary of Significant Accounting Policies

9 Months Ended

Mar. 31, 2016

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 March 31, 2016.

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 March 31, 2016, 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 $1,051,772, and a net loss for the quarters ended March 31, 2016 and 2015 of $28,249 and $66,068, 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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Recently Issued Accounting Pronouncements

9 Months Ended

Mar. 31, 2016

Recently Issued Accounting Pronouncements [Text Block]

Note 3 - Recently Issued Accounting Pronouncements

In July 2015, the FASB issued ASU 2015-11, “Inventory (Topic 330): Simplifying the Measurement of Inventory”. The amendments in ASU 2015-11 require an entity to measure in scope inventory at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. Subsequent measurement is unchanged for inventory measured using LIFO or the retail inventory method. The amendments do not apply to inventory that is measured using last-in, first-out (LIFO) or the retail inventory method. The amendments apply to all other inventory, which includes inventory that is measured using first-in, first-out (FIFO) or average cost. The amendments in this ASU are effective for public business entities for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2016, and interim periods within fiscal years beginning after December 15, 2017. A reporting entity should apply the amendments prospectively with earlier application permitted as of the beginning of an interim or annual reporting period. The adoption of ASU 2015-11 is not expected to have a material impact on the Company’s consolidated financial statements.

In August 2015, the FASB issuedASU 2015-14, “Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date”. The amendments in ASU 2015-14 defer the effective date of ASU 2014-09 for all entities by one year. Public business entities, certain not-for-profit entities, and certain employee benefit plans should apply the guidance in ASU 2014-09 to annual reporting periods beginning after December 15, 2017, including interim reporting periods within that reporting period. Earlier application is permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period. The Company is currently in the process of evaluating the impact of the adoption on its consolidated financial statements.

In September 2015, the FASB issued ASU 2015-16, “Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments”. The amendments in ASU 2015-16 require that an acquirer recognize adjustments to estimated amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The amendments require that the acquirer record, in the same period’s financial statements, the effect on earnings of changes in depreciation, amortization, or other income effects, if any, as a result of the change to the estimated amounts, calculated as if the accounting had been completed at the acquisition date. The amendments also require an entity to present separately on the face of the income statement or disclose in the notes the portion of the amount recorded in current-period earnings by line item that would have been recorded in previous reporting periods if the adjustment to the estimated amounts had been recognized as of the acquisition date. The amendments in this ASU are effective for public business entities for fiscal years beginning after December 15, 2015, including interim periods within those fiscal years. The amendments should be applied prospectively to adjustments to provisional amounts that occur after the effective date with earlier application permitted for financial statements that have not been issued. The adoption of ASU 2015-16 is not expected to have a material impact on the Company’s consolidated financial statements.

In November 2015, the FASB issued ASU 2015-17, “Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes”. The amendments in ASU 2015-17 eliminates the current requirement for organizations to present deferred tax liabilities and assets as current and noncurrent in a classified balance sheet. Instead, organizations will be required to classify all deferred tax assets and liabilities as noncurrent. The amendments in this ASU are effective for public business entities for financial statements issued for annual periods beginning after December 15, 2016, and interim periods within those annual periods. The amendments may be applied prospectively to all deferred tax liabilities and assets or retrospectively to all periods presented. The Company is currently in the process of evaluating the impact of the adoption on its consolidated financial statements.

In January 2016, the FASB issued ASU 2016-01, “Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities”. The amendments in ASU 2016-01, among other things, requires equity investments (except those accounted for under the equity method of accounting, or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income; Requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes; Requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset (i.e., securities or loans and receivables); Eliminates the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost. The amendments in this ASU are effective for public companies for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The new guidance permits early adoption of the own credit provision. In addition, the new guidance permits early adoption of the provision that exempts private companies and not-for-profit organizations from having to disclose fair value information about financial instruments measured at amortized cost. The Company is currently in the process of evaluating the impact of the adoption on its consolidated financial statements.

In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842)”. Among other things, in the amendments in ASU 2016-02, lessees will be required to recognize the following for all leases (with the exception of short-term leases) at the commencement date: A lease liability, which is a lessee‘s obligation to make lease payments arising from a lease, measured on a discounted basis; and A right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. Under the new guidance, lessor accounting is largely unchanged. Certain targeted improvements were made to align, where necessary, lessor accounting with the lessee accounting model and Topic 606, Revenue from Contracts with Customers. The amendments in this ASU are effective for public business entities for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early application is permitted for all public business entities and all nonpublic business entities upon issuance. Lessees (for capital and operating leases) and lessors (for sales-type, direct financing, and operating leases) must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The modified retrospective approach would not require any transition accounting for leases that expired before the earliest comparative period presented. Lessees and lessors may not apply a full retrospective transition approach. The Company is currently in the process of evaluating the impact of the adoption on its consolidated financial statements.

In March 2016, the FASB issued ASU 2016-03, “Intangibles-Goodwill and Other (Topic 350); Business Combinations (Topic 805); Consolidation (Topic 810); Derivatives and Hedging (Topic 815): Effective Date and Transition Guidance”. The amendments in this ASU make the guidance in ASUs 2014-02, 2014-03, 2014-07, and 2014-18 effective immediately by removing their effective dates. The amendments also include transition provisions that provide that private companies are able to forgo a preferability assessment the first time they elect the accounting alternatives within the scope of this ASU. Any subsequent change to an accounting policy election requires justification that the change is preferable under Topic 250, Accounting Changes and Error Corrections. The amendments in this ASU also extend the transition guidance in ASUs 2014-02, 2014-03, 2014-07, and 2014-18 indefinitely. While this ASU extends transition guidance for Updates 2014-07 and 2014-18, there is no intention to change how transition is applied for those two ASUs. The Company is currently in the process of evaluating the impact of the adoption on its consolidated financial statements.

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Accounts Payable and Accrued Liabilities

9 Months Ended

Mar. 31, 2016

Accounts Payable and Accrued Liabilities [Text Block]

Note 4 - Accounts Payable and Accrued Liabilities

Accounts Payable and Accrued Liabilities of $26,998 as of March 31, 2016 consists of a payment for vendor (hotel) of $569, various vendors of $509 for operating expenses and previous director of $25,920.

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Related Parties

9 Months Ended

Mar. 31, 2016

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 the nine months ended March 31, 2016, 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 nine months ended March 31, 2016, a Company owned by Feng Li, the husband of Mrs. Hong Ba, our CEO, charged the Company $7,392 (2015 - $8,151) in rent and $9,702 (June 30, 2015 - $1,921) is outstanding.

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Income Taxes

9 Months Ended

Mar. 31, 2016

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
		March 31, 2016			June 30, 2015
United States of America	$	(21,178	)	$	(34,880	)
Canada		(6,174	)		(39,433	)
People's Republic of China		(897	)		(6,828	)
Loss before income taxes	$	(28,249	)	$	(81,141	)

The components of deferred taxes assets at March 31, 2016 and June 30, 2015:

		2016			2015
USA net operating losses	$	7,201		$	11,859
Canada net operating losses		772			5,323
PRC net operating losses		224			1,855
Deferred tax assets, net		8,197			19,037
Less: valuation allowance		(8,197	)		(19,037	)
Deferred tax assets, net	$	-		$	-

As of March 31, 2016, the Company has an accumulated deficit of $1,051,772 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 March 31, 2016 and June 30, 2015, there were no tax penalties or interest.

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Commitment and Contingencies

9 Months Ended

Mar. 31, 2016

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 six 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
2016		9,600
2017		9,600
2018		9,600
2019 and thereafter		-
Total	$	28,800

For each of the quarters ended March 31, 2016 and 2015, the Company recorded a rent expense of $7,392 and $8,101, respectively.

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Common Stock

9 Months Ended

Mar. 31, 2016

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 March 31, 2016 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)

9 Months Ended

Mar. 31, 2016

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 March 31, 2016.

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 March 31, 2016, 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 $1,051,772, and a net loss for the quarters ended March 31, 2016 and 2015 of $28,249 and $66,068, 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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Income Taxes (Tables)

9 Months Ended

Mar. 31, 2016

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

		For the Quarter Ended			For the Year Ended
		March 31, 2016			June 30, 2015
United States of America	$	(21,178	)	$	(34,880	)
Canada		(6,174	)		(39,433	)
People's Republic of China		(897	)		(6,828	)
Loss before income taxes	$	(28,249	)	$	(81,141	)

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

		2016			2015
USA net operating losses	$	7,201		$	11,859
Canada net operating losses		772			5,323
PRC net operating losses		224			1,855
Deferred tax assets, net		8,197			19,037
Less: valuation allowance		(8,197	)		(19,037	)
Deferred tax assets, net	$	-		$	-

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Commitment and Contingencies (Tables)

9 Months Ended

Mar. 31, 2016

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

Year Ending June 30		Amounts
2016		9,600
2017		9,600
2018		9,600
2019 and thereafter		-
Total	$	28,800

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Organization, Nature of Operations and Basis of Presentation (Narrative) (Details) - 9 months ended Mar. 31, 2016	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

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Summary of Significant Accounting Policies (Narrative) (Details)	9 Months Ended
	Mar. 31, 2016 USD ($)
Summary Of Significant Accounting Policies 1	382
Summary Of Significant Accounting Policies 2	$ 1,051,772
Summary Of Significant Accounting Policies 3	28,249
Summary Of Significant Accounting Policies 4	$ 66,068

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Accounts Payable and Accrued Liabilities (Narrative) (Details)	9 Months Ended
	Mar. 31, 2016 USD ($)
Accounts Payable And Accrued Liabilities 1	$ 26,998
Accounts Payable And Accrued Liabilities 2	569
Accounts Payable And Accrued Liabilities 3	509
Accounts Payable And Accrued Liabilities 4	$ 25,920

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Related Parties (Narrative) (Details)	9 Months Ended
	Mar. 31, 2016 USD ($) $ / shares shares
Related Parties 1 | shares	14,962,200
Related Parties 2	$ 149,622
Related Parties 3 | $ / shares	$ 0.01
Related Parties 4	$ 7,392
Related Parties 5	8,151
Related Parties 6	9,702
Related Parties 7	$ 1,921

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Income Taxes (Narrative) (Details)	9 Months Ended
	Mar. 31, 2016 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	$ 1,051,772

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Commitment and Contingencies (Narrative) (Details)	9 Months Ended
	Mar. 31, 2016 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	7,392
Commitment And Contingencies 6	$ 8,101

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Common Stock (Narrative) (Details)	9 Months Ended
	Mar. 31, 2016 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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Schedule of Components of Loss Before Income Taxes (Details)	9 Months Ended
	Mar. 31, 2016 USD ($)
Income Taxes Schedule Of Components Of Loss Before Income Taxes 1	$ (21,178)
Income Taxes Schedule Of Components Of Loss Before Income Taxes 2	(34,880)
Income Taxes Schedule Of Components Of Loss Before Income Taxes 3	(6,174)
Income Taxes Schedule Of Components Of Loss Before Income Taxes 4	(39,433)
Income Taxes Schedule Of Components Of Loss Before Income Taxes 5	(897)
Income Taxes Schedule Of Components Of Loss Before Income Taxes 6	(6,828)
Income Taxes Schedule Of Components Of Loss Before Income Taxes 7	(28,249)
Income Taxes Schedule Of Components Of Loss Before Income Taxes 8	$ (81,141)

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Schedule of Deferred Tax Assets and Liabilities (Details)	9 Months Ended
	Mar. 31, 2016 USD ($)
Income Taxes Schedule Of Deferred Tax Assets And Liabilities 1	$ 7,201
Income Taxes Schedule Of Deferred Tax Assets And Liabilities 2	11,859
Income Taxes Schedule Of Deferred Tax Assets And Liabilities 3	772
Income Taxes Schedule Of Deferred Tax Assets And Liabilities 4	5,323
Income Taxes Schedule Of Deferred Tax Assets And Liabilities 5	224
Income Taxes Schedule Of Deferred Tax Assets And Liabilities 6	1,855
Income Taxes Schedule Of Deferred Tax Assets And Liabilities 7	8,197
Income Taxes Schedule Of Deferred Tax Assets And Liabilities 8	19,037
Income Taxes Schedule Of Deferred Tax Assets And Liabilities 9	(8,197)
Income Taxes Schedule Of Deferred Tax Assets And Liabilities 10	(19,037)
Income Taxes Schedule Of Deferred Tax Assets And Liabilities 11	0
Income Taxes Schedule Of Deferred Tax Assets And Liabilities 12	$ 0

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Schedule of Future Minimum Rental Payments for Operating Leases (Details)	9 Months Ended
	Mar. 31, 2016 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