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 September 30, 2019 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)

Securities registered under Section 12(b) of the Exchange Act: None.

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 every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Yes [X] No [   ]

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

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

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

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

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date: 82,489,391 shares of common stock issued and outstanding as of November 14, 2019.

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION	1
ITEM 1. FINANCIAL STATEMENTS	1
Condensed Consolidated Balance Sheets	2
Condensed Consolidated Statements of Income and Comprehensive Income	3
Condensed Consolidated StatementS of Cash Flows	4
Consolidated Statement of Stockholder's Equity	5
Notes to Condensed Consolidated Financial Statements	6
ITEM 2 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	11
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	14
ITEM 4. CONTROLS AND PROCEDURES.	14
PART II - OTHER INFORMATION	15
ITEM 1. LEGAL PROCEEDINGS.	15
ITEM 1A. RISK FACTORS	15
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	15
ITEM 3. DEFAULTS UPON SENIOR SECURITIES	15
ITEM 4. MINE SAFETY DISCLOSURES	15
ITEM 5. OTHER INFORMATION	15
ITEM 6. EXHIBITS	16
SIGNATURES	17

PART I-FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

1

W&E Source Corp. and Subsidiaries

Condensed Consolidated Balance Sheets
As of September 30, 2019 and June 30, 2019

		September 30, 2019			June 30, 2019
Assets		(Unaudited)
Current Assets
Cash	$	2,930		$	2,508
Other receivables		56			43
Total current assets		2,986			2,551
Non-Current Assets
Prepayments/Deposits		11,328			11,457
Total non-current assets		11,328			11,457
TOTAL ASSETS	$	14,314		$	14,008
Liabilities and Shareholders' Equity (Deficit)
Current liabilities
Accounts payable and accrued liabilities	$	7,854		$	17,857
Advanced for share issuance from related party		149,304			120,988
Advances from related parties and related party payables		25,003			23,452
Total current liabilities		182,161			162,297
TOTAL LIABILITIES		182,161			162,297
Shareholders' deficit
Common stock, $0.0001 par value, 500,000,000 shares authorized, 82,489,391 and 82,489,391 shares issued and outstanding as of September 30, 2019 and June 30, 2019, respectively		8,249			8,249
Additional paid-in capital		1,059,931			1,059,931
Accumulated deficit		(1,250,258	)		(1,227,859	)
Accumulated other comprehensive income		14,231			11,390
Total shareholders' deficit		(167,847	)		(148,289)	)
TOTAL LIABILITIES AND SHAREHOLDERS' DEFICIT	$	14,314		$	14,008

 

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

2

W&E Source Corp. and Subsidiaries

Condensed Consolidated Statements of Income and Comprehensive Income
For the Three Months Ended September 30, 2019 and 2018
(Unaudited)

		September 30, 2019			September 30, 2018
Net revenues	$	113		$	77
Gross profit		113			77
Operating expenses
General and administrative expenses		(11,378	)		(11,451	)
Total operating expenses		(11,378	)		(11,451	)
Operating Loss		(11,265	)		(11,374	)
Other Income (expense)
Foreign currency exchange gain (loss)		(11,134	)		(758	)
Total other income (expense)	$	(11,134	)	$	(758	)
Net loss		(22,399	)		(12,132	)
Other comprehensive income
Cumulative foreign currency translation adjustment		2,841			361
Comprehensive loss	$	(19,558	)	$	(11,771	)
Weighted average number of shares outstanding - basic and diluted		82,489,391			82,489,391
Loss per share - basic and diluted		($0.00	)		($0.00	)

 

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

3

W&E Source Corp. and Subsidiaries

Condensed Consolidated Statements of Cash Flows
For the Three Months Ended September 30, 2019 and 2018
(Unaudited)

		September 30, 2019			September 30, 2018
Cash Flow from Operating Activities
Net loss	$	(22,399	)	$	(12,132	)
Adjustments to reconcile net loss to net cash used in operating activities:
Foreign currency exchange loss		1,382			2,877
Change in operating assets and liabilities:
Decrease in prepaid expenses and deposits		(113	)		(77	)
Decrease in accounts payable and accrued  liabilities		(11,101	)		(2,784)
Increase in due to related party		2,913			747
Net cash used in operating activities		(29,318	)		(11,369	)
Cash Flows from Financing Activities
Advance for future share issuance		29,693			11,072
Net cash provided by financing activities		29,693			11,072
Cumulative translation adjustment		47			(679)
Net increase (decrease) in cash		422			(976)
Cash, beginning of period		2,508			2,925
Cash, end of period	$	2,930		$	1,949
Supplemental cash flows information
Interest paid	$	-		$	-
Income tax paid		-			-
Non cash investing and financing activities	$			$
Share issuance for  debt settlement	$	-		$	-

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

4

W&E Source Corp. and Subsidiaries
Condensed Consolidated Statements of Changes in Shareholders’ Deficit
As of September 30, 2019 and Year Ended June 30, 2019
(Unaudited)

				Accumulated			Total
			Additional	other			Shareholders'
		Common Stock	Paid-in	Comprehensive	Accumulated		Equity
	Shares	Amount	Capital	Income	Deficit		(Deficit)
Balance at June 30, 2018	82,489,391	8,249	1,059,931	9,938	(1,178,120	)	(100,002	)
Foreign currency translation adjustment	-	-	-	361	-		361
Net Loss	-	-	-	-	(12,132	)	(12,132	)
Balance at September 30, 2018 (Unaudited)	82,489,391	8,249	1,059,931	10,299	(1,190,252)	)	(111,773	)
Balance at June 30, 2019	82,489,391	8,249	1,059,931	11,390	(1,227,859	)	(148,289	)
Foreign currency   translation adjustment	-	-	-	2,841	-		2,841
Net Loss	-	-	-	-	(22,399	)	(22,399)
Balance at September 30, 2019 (Unaudited)	82,489,391	8,249	1,059,931	14,231	(1,250,258	)	(167,847	)

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

5

W&E Source Corp.

(Formerly News of China, Inc.)

Notes to Interim Consolidated Financial Statements

For the Periods Ended September 30, 2019 and June 30, 2019 

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 OTC Markets was also changed to WESC.

During the quarter 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 pay Baopiao RMB200, 000 as repayment of the Debt and satisfy the remaining Debt of RMB1,600,000 within 20 days 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.

6

Note 2 - Summary of Significant Accounting Policies

a.Basis of presentation.

The accompanying interim consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X as promulgated by the Securities and Exchange Commission (the "SEC"). In the opinion of management, the financial statements include all adjustments of a normal recurring nature necessary for a fair statement of the results for the periods presented. Certain information and footnote disclosures normally included in financial statements prepared in conjunction with generally accepted accounting principles have been condensed or omitted as permitted by the rules and regulations of the United States Securities and Exchange Commission ("SEC"), although the Company believes that the disclosures contained in this report are adequate to make the information presented not misleading. The unaudited consolidated balance sheet information as of September 30, 2019 was derived from the consolidated audited financial statements included in the Company's Annual Report on Form 10-K for the year ended June 30, 2019. These unaudited consolidated financial statements should be read in conjunction with the annual consolidated audited financial statements and the notes thereto included in the Company's Annual Report on Form 10-K for the year ended June 30, 2019, and other reports filed with the SEC. Operating results for the three months ended September 30, 2019 are not necessarily indicative of the results that may be expected for the full year ended June 30, 2020.

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 the U.S. dollar. Therefore, the consolidated financial statements for all periods presented have been translated into the 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 shareholders' equity.

c. Principles of consolidation.

The 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 consolidated 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 consolidated 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 loss available to common stockholders by the weighted average number of common shares outstanding during the period, excluding the effects of any potentially dilutive securities. Diluted EPS gives effect to all dilutive potential of shares of common stock outstanding during the period including stock options or warrants, using the treasury stock method (by using the average stock price for the period to determine the number of shares assumed to be purchased from the exercise of stock options or warrants), and convertible debt or convertible preferred stock, using the if-converted method. EPS excludes all potential dilutive shares of common stock if their effect is anti-dilutive. There were no dilutive securities at September 30, 2019 and June 30, 2019.

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 non-cancellable, 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. Effective January 1, 2018, the Company adopted the guidance of Accounting Standards Codification (ASC) 606, Revenue from Contracts. The implementation of ASC 606 did not have a material impact on the Company's consolidated financial statements. ASC 606 create a five-step model that requires entities to exercise judgement when considering the terms of contract, which includes (1) identifying the contracts or agreement with a customer, (2) identifying our performance obligations in the contract or agreement, (3) determining the transaction price, (4) allocating the transaction price to the separate performance obligation, and (5) recognizing revenue as each performance obligation is satisfied. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the services it transfers to its clients. The Company's revenue consists of revenue from providing travel consulting and travel arrangement advisory services ("service revenue"), and service revenue from travel schedule arrangements and advisory.

7

g. Cash and cash equivalents.

The Company includes in cash and cash equivalents all short-term, highly liquid investments that mature within three months or less of their acquisition date. Cash equivalents consist principally of investments in interest-bearing demand deposit accounts and liquidity funds with financial institutions and are stated at cost, which approximates fair value. As of September 30, 2019 and June 30, 2019, 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. As of September 30, 2019, there is no property or equipment.

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 carryforwards, 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. The Company's net operating losses carryforwards 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 consolidated results of operations, financial position, or cash flows of the Company.

  Recently Issued Accounting Pronouncements

In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. The new guidance is intended to reduce diversity in practice in how certain transactions are classified in the statement of cash flows. ASU 2016-15 is effective for public business entities for fiscal years beginning after 15 December 2017, and interim periods within those years. For all other entities, it is effective for fiscal years beginning after 15 December 2018, and interim periods within fiscal years beginning after 15 December 2019. Early adoption is permitted. Entities will have to apply the guidance retrospectively, but if it is impracticable to do so for an issue, the amendments related to that issue would be applied prospectively. The Company is currently evaluating the impact of the adoption of this guidance on its consolidated financial statements, if any.

On November 17, 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash. Entities will be required to show the changes in the total of cash, cash equivalents, restricted cash and restricted cash equivalents in the statement of cash flows. As a result, entities will no longer present transfers between cash and cash equivalents and restricted cash and restricted cash equivalents in the statement of cash flows. There is no impact of the adoption of this guidance on its consolidated financial statements.

In July 2018, the FASB issued ASU No. 2018-10, Codification Improvements to Topic 842, Leases, to clarify on how to apply certain aspects of the new lease accounting standard. The amendments in this update, among other things, better articulates the requirement for a lessee's reassessment of lease classification as of the effective date of a modification, clarifies that a change to an index or rate for variable lease payments does not constitute a resolution of a contingency that would result in the remeasurement of lease payments, and requires entities that apply Topic 842 retrospectively to each reporting period and do not adopt the practical expedients to write off any prior unamortized initial direct costs that do not meet the definition under Topic 842 to equity. The amendments in this update have the same effective date and transition requirements as the new lease standard summarized above. The Company has evaluated the impact of adoption of Topic 842 on the Company's consolidated financial position and results of operations as stated above. There would be an impact of the adoption of this guidance on its consolidated financial statements for the first quarter ended as of September 30, 2019. 

8

Note 3 - Going Concern

As reflected in the accompanying consolidated financial statements, the Company had accumulated deficits of $1,250,258 and $1,190,252, and net losses of $22,399 and $12,132, respectively, for the three months ended September 30, 2019 and 2018. 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 the current actions to obtain additional funding from independent investors or from the management and to implement its strategic plans should allow the Company to continue as a going concern. There are no assurances that additional funds will be available when needed from any source or, if available, will be available on terms that are acceptable to us.

Note 4 - Prepayment

As of September 30, 2019, the Company prepaid a security deposit of $11,328 (Cnd$15,000) ($11,415 - 2019) to Consumer Protection British Columbia Province for the guarantee of service quality.

Note 5 - Accounts Payable and Accrued Liabilities

Accounts Payable and Accrued Liabilities of $7,854 as of September 30, 2019 consists of payment of $980 in legal fees, $5,400 in audit and accounting fees and $1,474 in filing fees. (June 30, 2019 - $17,857).

Note 6 - 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"). 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.

As of the three months ended September 30, 2019, the CEO of the Company advanced $140 (June 30, 2019 - $146) to the Company for operating expenditure.

During the three months ended September 30, 2019, a company owned by Feng Li, the husband of Mrs. Hong Ba, our CEO, charged the Company $1,813 (Cnd$2,400) (2018 - $1,847) in rent and the debt of $23,562 has been due to the related party (2019 - $23,452).

As of the period ended September 30, 2019, the husband of Mrs. Hong Ba, our CEO, advanced $1,100 (September 30, 2019 - $1,100) to the Company for the operating expenditure.

As of September 30, 2019, the Company has received advances for future share issuance of $149,304 (June 30, 2019 - $120,988) and an advance of $201 (June 30, 2019 - $209) for operating expenditure from a related party who will be an over 10% shareholder of the Company.

9

Note 7 - Commitment and Contingencies

The Company leases an office space in Canada for a term under month by month operating lease agreement. Monthly rent is $616 (Cdn$800).

2019 Cdn $9,600

2020 Cdn $9,600

2021 Cdn $9,600

2022 Cdn $9,600

2023  Cdn $9,600

The lease agreement for the Beijing office was terminated effective from October 1, 2013.

For each of the three months ended September 30, 2019 and 2018, the Company recorded a rent expense of $1,813 (Cdn$2,400) and $1,847 (Cdn$2,400), 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 September 30, 2019 and June 30, 2019, 82,489,391 and 82,489,391 shares of common stock were issued and outstanding, respectively. 

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.

On August 5, 2016, the Company entered into Debt Conversion Agreements (the "Agreements") with each of Lin Li and Youzhe Li, who were each creditors to the Company with total outstanding balances of $25,920 (the "Lin Li Loan") and $78,861 (the "Youzhe Li Loan" and, together with the Lin Li Loan, the "Loans"), respectively. Pursuant to the Agreements the Company agreed to issue an aggregate total of 19,051,091 shares of its common stock, $0.0001 par value per share (the "Shares"), at the conversion rate of $0.0055 per share as full payment for the Loans. Upon issuance and delivery of the Shares, the Loans were fully paid and the Company no longer had any obligations to the individuals under the Loans.

Lin Li is the sister of Mr. Feng Li, who is the husband of Hong Ba, the Company's director, CEO and CFO.

On August 5, 2016, the Company issued 14,338,364 common shares of the Company to such a related party in cancellation of the debt of $78,861 owed to such party at such time. 

As of September 30, 2019 and June 30, 2019, the Company has received $149,304 and $120,988, respectively, advanced for a future share issuance from a related party, which amounts do not bear interest and are due on demand. 

As the filing date of these financial statements, there are 82,489,391 shares issued and outstanding.

10

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

Forward Looking Statements

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

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

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

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

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

Corporate Overview

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

We have set up three subsidiaries, Airchn Travel Global, Inc. in Seattle, Washington ("ATGI") and Airchn Travel (Canada) Inc., in Vancouver, British Columbia in Canada ("ATCI") and Airchn Travel (Beijing) Inc. in Beijing, China ("ATBI"). We plan to set up additional subsidiaries in Hong Kong, Macau, Taiwan, Japan and Korea in the near future.  Our Beijing office has been closed as of September 30, 2019 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 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.

Results of Operations

The following summary of our results of operations should be read in conjunction with our unaudited financial statements for the quarters ended September 30, 2019 and 2018 contained in this Report.

11

Three Months Ended September 30, 2019 and 2018:

		Three Months Ended			Three Months Ended
		September 30,			September 30,
		2019			2018
Revenues	$	113		$	77
Expenses
General and administrative expenses		(11,378	)		(11,451	)
Foreign currency exchange gain (loss)		(11,134	)		(758	)
Net loss	$	(22,399	)	$	(12,132	)

Revenues

We had generated revenue of $113 from operations during the three months ended September 30, 2019 as compared to $77 for the same period in 2018, an increase of $36 or 47%. The increase was mainly due to the increase in our travel business arrangement income in the quarter ended September 30, 2019.

General and administrative expenses

General and administrative expenses for the three months ended September 30, 2019 decreased by $73 or 1%, compared with the same period in 2018.

Net loss

We had net losses of $12,132 and $6,504 for the three months ended September 30, 2019 and 2018, respectively, an increase of $5,628 or 46%, and had an accumulated deficit of $1,190,252 since the inception of our business as at September 30, 2019. The increase in net loss is mainly attributable to an increase of general and administrative expenses and foreign exchange loss, and partially offset by an increase in sales revenue.

Liquidity and Capital Resources

Our financial condition at the end of September 30, 2019 and June 30, 2019 are summarized as follows:

Working Capital

		September 30, 2019			June 30, 2019
Current Assets	$	2,986		$	2,551
Current Liabilities		(182,161	)		(158,952)
Working Capital	$	(179,175	)	$	(156,401)

Our working capital deficit increased from the previous year and current assets were still insufficient to cover liabilities; the deficit magnitude increased by some $22,774 due to additional funds advanced for share issuance and due to related parties.

Cash Flows

		September 30, 2019		September 30, 2018
Cash used in operating activities	$	(29,318)	$	(11,369)
Cash provided by financing activities		29,693		11,072
Cumulative translation adjustment		47		(679)
Net increase (decrease) in cash	$	422	$	(976)

 

12

Cash Used in Operating Activities

For the three months ended September 30, 2019, our cash used in operating activities increased by $17,949 or 157% to $29,318, compared with $11,369 for the three months in the prior year. The increase is mainly due to an increase in foreign exchange loss compared with the three months in the prior year.

Cash Used in Investing Activities

For the three months ended September 30, 2019 and 2018, we have no cash investing activities as compared from the same period last year.

Cash Provided by Financing Activities

For the three months ended September 30, 2019, the Company received $29,693 from financing activities in the form of cash advances for future share issuances from a party compared with $11,072 in the same period in 2018.

Cash Requirements

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

Expense		Amount
General and administrative	$	5,000
Professional fees		50,000
Foreign currency exchange loss		5,000
Total	$	60,000

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

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.

Transactions with related persons

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"). 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.

As of the three months ended September 30, 2019, the CEO of the Company advanced $140 (June 30, 2019 - $146) to the Company for operating expenditure

During the three months ended September 30, 2019, a company owned by Feng Li, the husband of Mrs. Hong Ba, our CEO, charged the Company $1,813 (Cnd$2,400) (2018 - $1,847) in rent and the debt of $23,562 has been due to the related party (2019 - $23,452).

As of the period ended September 30, 2019, the husband of Mrs. Hong Ba, our CEO, advanced $1,100 (September 30, 2019 - $1,100) to the Company for the operating expenditure.

13

As of September 30, 2019, the Company has received advances for future share issuance of $149,304 (June 30, 201 - $120,988) and an advance of $201 (June 30, 2019 - $209) for operating expenditure from a related party who will be an over 10% shareholder of the Company.

Off Balance Sheet Arrangements

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

Recently Issued Accounting Standards

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

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not Applicable.

ITEM 4. CONTROLS AND PROCEDURES.

Disclosure Controls and Procedures

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

As required by paragraph (b) of Rules 13a-15 under the Securities Exchange Act of 1934, our management, with the participation of our principal executive officer and principal financial officer, evaluated our company's disclosure controls and procedures as of the end of the period covered by this quarterly report on Form 10-Q. Based on this evaluation, our management concluded that as of the end of the period covered by this quarterly report on Form 10-Q, our disclosure controls and procedures were not effective due to the material weaknesses described in Management's annual report on internal control over financial reporting contained in our Annual Report on Form 10-K for the year ended June 30, 2019.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting during the three months ended September 30, 2019 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

14

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, 2019.  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, 2019 may cause our actual results, performances and achievements to be materially different from those expressed or implied by our forward-looking statements.  If any of these risks or events occurs, our business, financial condition or results of operations may be adversely affected.

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

During the quarter ended September 30, 2019, 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 September 30, 2019, the aggregate amount of the advances to be used for such share purchases was $29,693, 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.

15

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	Certificate of Amendment of Certificate of Incorporation (incorporated by reference to an exhibit to the Quarter Report on form 10-Q filed on February 10, 2012)
3.3	By-Laws (attached as an exhibit to our registration statement on Form SB-2 filed September 25, 2006)

(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 Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document

*filed herewith

16

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

W&E Source Corp.

/s/ Hong Ba
Hong Ba
CEO and CFO
Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer

Date: November 14, 2019

17

EX-31.1

Exhibit 31.1

Certification of Principal Executive Officer and Principal Financial Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

and Securities and Exchange Commission Release 34-46427

I, Hong Ba, certify that:

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

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

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

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

c. Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

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

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

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

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

Date: November 14, 2019

/s/ Hong Ba

Hong Ba, Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of W&E Source Corp. (the "Company") on Form 10-Q for the quarter ended September 30, 2019 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Hong Ba, certify, pursuant to 18 U.S.C. ss. 1350, as adopted pursuant to ss. 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

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

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

Date: November 14, 2019

/s/ Hong Ba

Hong Ba

Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer

XML

Commitment and Contingencies (Tables)

3 Months Ended

Sep. 30, 2019

Notes to Financial Statements [Abstract]

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

2019	Cdn	$	9,600
2020	Cdn	$	9,600
2021	Cdn	$	9,600
2022	Cdn	$	9,600
2023	Cdn	$	9,600

XML

Related Parties

3 Months Ended

Sep. 30, 2019

Notes to Financial Statements [Abstract]

Related Parties [Text Block]

Note 6 - 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”). 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.

As of the three months ended September 30, 2019, the CEO of the Company advanced $140 (June 30, 2019 - $146) to the Company for operating expenditure.

During the three months ended September 30, 2019, a company owned by Feng Li, the husband of Mrs. Hong Ba, our CEO, charged the Company $1,813 (Cnd$2,400) (2018 - $1,847) in rent and the debt of $23,562 has been due to the related party (2019 - $23,452).

As of the period ended September 30, 2019, the husband of Mrs. Hong Ba, our CEO, advanced $1,100 (September 30, 2019 - $1,100) to the Company for the operating expenditure.

As of September 30, 2019, the Company has received advances for future share issuance of $149,304 (June 30, 2019 - $120,988) and an advance of $201 (June 30, 2019 - $209) for operating expenditure from a related party who will be an over 10% shareholder of the Company.

XML

Going Concern

3 Months Ended

Sep. 30, 2019

Notes to Financial Statements [Abstract]

Substantial Doubt about Going Concern [Text Block]

Note 3 - Going Concern

As reflected in the accompanying consolidated financial statements, the Company had accumulated deficits of $1,250,258 and $1,190,252, and net losses of $22,399 and $12,132, respectively, for the three months ended September 30, 2019 and 2018. 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 the current actions to obtain additional funding from independent investors or from the management and to implement its strategic plans should allow the Company to continue as a going concern. There are no assurances that additional funds will be available when needed from any source or, if available, will be available on terms that are acceptable to us.

XML

Document and Entity Information - shares	3 Months Ended
	Sep. 30, 2019	Nov. 14, 2019
Document and Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2019
Entity Registrant Name	W&E Source Corp.
Entity Central Index Key	0001368275
Current Fiscal Year End Date	--06-30
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		82,489,391
Entity Current Reporting Status	Yes
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q1
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false

XML

Condensed Consolidated Statements of Cash Flows - USD ($)	3 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Cash Flow from Operating Activities
Net loss	$ (22,399)	$ (12,132)
Adjustments to reconcile net loss to net cash used in operating activities:
Foreign currency exchange loss	1,382	2,877
Change in operating assets and liabilities:
Decrease in prepaid expenses and deposits	(113)	(77)
Decrease in accounts payable and accrued liabilities	(11,101)	(2,784)
Increase in due to related party	2,913	747
Net cash used in operating activities	(29,318)	(11,369)
Cash Flows from Financing Activities
Advance for future share issuance	29,693	11,072
Net cash provided by financing activities	29,693	11,072
Cumulative translation adjustment	47	(679)
Net increase (decrease) in cash	422	(976)
Cash, beginning of period	2,508	2,925
Cash, end of period	2,930	1,949
Supplemental cash flows information
Interest paid	0	0
Income tax paid	0	0
Non cash investing and financing activities
Share issuance for debt settlement	$ 0	$ 0

XML

Common Stock (Narrative) (Details)		1 Months Ended
	Aug. 05, 2016 USD ($) $ / shares shares	Oct. 26, 2014 USD ($) shares	Jan. 23, 2012 USD ($) shares	Sep. 30, 2019 USD ($) $ / shares shares	Jun. 30, 2019 USD ($) $ / shares shares	Jan. 31, 2012 shares
Debt Conversion, Converted Instrument, Shares Issued | shares	19,051,091	15,538,300
Debt Conversion, Converted Instrument, Amount | $		$ 155,383
Debt Instrument, Convertible, Conversion Ratio	0.0055	0.01
Common Stock, Shares Authorized | shares				500,000,000	500,000,000	500,000,000
Common Stock, Par or Stated Value Per Share | $ / shares	$ 0.0001			$ 0.0001	$ 0.0001
Common Stock, Shares, Issued | shares				82,489,391	82,489,391
Common Stock, Shares, Outstanding | shares				82,489,391	82,489,391
Advances from a future share issuance | $				$ 149,304	$ 120,988
Stock issued during period, cancellation of advance | shares	14,338,364
Stock issued during period, value, cancellation of advance | $	$ 78,861
Hong Ba [Member]
Stock Issued During Period, Shares, New Issues | shares			22,000,000
Stock Issued During Period, Value, New Issues | $			$ 630,000
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners			45.90%
Lin Li [Member]
Debt Conversion, Converted Instrument, Amount | $	25,920
Youzhe Li [Member]
Debt Conversion, Converted Instrument, Amount | $	$ 78,861

XML

Prepayment (Narrative) (Details)	Sep. 30, 2019 CAD ($)	Sep. 30, 2019 USD ($)	Jun. 30, 2019 USD ($)
Prepayment [Line Items]
Prepayments/Deposits		$ 11,328	$ 11,457
Consumer Protection British Columbia Province
Prepayment [Line Items]
Prepayments/Deposits	$ 15,000	$ 11,328	$ 11,415

XML

Condensed Consolidated Statements of Income and Comprehensive Income - USD ($)	3 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Statement of Operations [Abstract]
Net revenues	$ 113	$ 77
Gross profit	113	77
Operating expenses
General and administrative expenses	(11,378)	(11,451)
Total operating expenses	(11,378)	(11,451)
Operating Loss	(11,265)	(11,374)
Other Income (expense)
Foreign currency exchange gain (loss)	(11,134)	(758)
Total other income (expense)	(11,134)	(758)
Net loss	(22,399)	(12,132)
Other comprehensive income
Cumulative foreign currency translation adjustment	2,841	361
Comprehensive loss	$ (19,558)	$ (11,771)
Weighted average number of shares outstanding - basic and diluted (in shares)	82,489,391	82,489,391
Loss per share - basic and diluted (in dollars per share)	$ (0.00)	$ (0.00)

XML

Summary of Significant Accounting Policies

3 Months Ended

Sep. 30, 2019

Notes to Financial Statements [Abstract]

Summary of Significant Accounting Policies [Text Block]

Note 2 - Summary of Significant Accounting Policies

a.    Basis of presentation.

The accompanying interim consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X as promulgated by the Securities and Exchange Commission (the "SEC"). In the opinion of management, the financial statements include all adjustments of a normal recurring nature necessary for a fair statement of the results for the periods presented. Certain information and footnote disclosures normally included in financial statements prepared in conjunction with generally accepted accounting principles have been condensed or omitted as permitted by the rules and regulations of the United States Securities and Exchange Commission ("SEC"), although the Company believes that the disclosures contained in this report are adequate to make the information presented not misleading. The unaudited consolidated balance sheet information as of September 30, 2019 was derived from the consolidated audited financial statements included in the Company's Annual Report on Form 10-K for the year ended June 30, 2019. These unaudited consolidated financial statements should be read in conjunction with the annual consolidated audited financial statements and the notes thereto included in the Company's Annual Report on Form 10-K for the year ended June 30, 2019, and other reports filed with the SEC. Operating results for the three months ended September 30, 2019 are not necessarily indicative of the results that may be expected for the full year ended June 30, 2020.

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 the U.S. dollar. Therefore, the consolidated financial statements for all periods presented have been translated into the 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 shareholders' equity.

c.    Principles of consolidation.

The 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 consolidated 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 consolidated 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 loss available to common stockholders by the weighted average number of common shares outstanding during the period, excluding the effects of any potentially dilutive securities. Diluted EPS gives effect to all dilutive potential of shares of common stock outstanding during the period including stock options or warrants, using the treasury stock method (by using the average stock price for the period to determine the number of shares assumed to be purchased from the exercise of stock options or warrants), and convertible debt or convertible preferred stock, using the if-converted method. EPS excludes all potential dilutive shares of common stock if their effect is anti-dilutive. There were no dilutive securities at September 30, 2019 and June 30, 2019.

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 non-cancellable, 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. Effective January 1, 2018, the Company adopted the guidance of Accounting Standards Codification (ASC) 606, Revenue from Contracts. The implementation of ASC 606 did not have a material impact on the Company's consolidated financial statements. ASC 606 create a five-step model that requires entities to exercise judgement when considering the terms of contract, which includes (1) identifying the contracts or agreement with a customer, (2) identifying our performance obligations in the contract or agreement, (3) determining the transaction price, (4) allocating the transaction price to the separate performance obligation, and (5) recognizing revenue as each performance obligation is satisfied. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the services it transfers to its clients. The Company's revenue consists of revenue from providing travel consulting and travel arrangement advisory services ("service revenue"), and service revenue from travel schedule arrangements and advisory.

g.    Cash and cash equivalents.

The Company includes in cash and cash equivalents all short-term, highly liquid investments that mature within three months or less of their acquisition date. Cash equivalents consist principally of investments in interest-bearing demand deposit accounts and liquidity funds with financial institutions and are stated at cost, which approximates fair value. As of September 30, 2019 and June 30, 2019, 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. As of September 30, 2019, there is no property or equipment.

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 carryforwards, 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. The Company’s net operating losses carryforwards 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 consolidated results of operations, financial position, or cash flows of the Company.

Recently Issued Accounting Pronouncements

In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. The new guidance is intended to reduce diversity in practice in how certain transactions are classified in the statement of cash flows. ASU 2016-15 is effective for public business entities for fiscal years beginning after 15 December 2017, and interim periods within those years. For all other entities, it is effective for fiscal years beginning after 15 December 2018, and interim periods within fiscal years beginning after 15 December 2019. Early adoption is permitted. Entities will have to apply the guidance retrospectively, but if it is impracticable to do so for an issue, the amendments related to that issue would be applied prospectively. The Company is currently evaluating the impact of the adoption of this guidance on its consolidated financial statements, if any.

On November 17, 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash. Entities will be required to show the changes in the total of cash, cash equivalents, restricted cash and restricted cash equivalents in the statement of cash flows. As a result, entities will no longer present transfers between cash and cash equivalents and restricted cash and restricted cash equivalents in the statement of cash flows. There is no impact of the adoption of this guidance on its consolidated financial statements.

In July 2018, the FASB issued ASU No. 2018-10, Codification Improvements to Topic 842, Leases, to clarify on how to apply certain aspects of the new lease accounting standard. The amendments in this update, among other things, better articulates the requirement for a lessee's reassessment of lease classification as of the effective date of a modification, clarifies that a change to an index or rate for variable lease payments does not constitute a resolution of a contingency that would result in the remeasurement of lease payments, and requires entities that apply Topic 842 retrospectively to each reporting period and do not adopt the practical expedients to write off any prior unamortized initial direct costs that do not meet the definition under Topic 842 to equity. The amendments in this update have the same effective date and transition requirements as the new lease standard summarized above. The Company has evaluated the impact of adoption of Topic 842 on the Company's consolidated financial position and results of operations as stated above. There would be an impact of the adoption of this guidance on its consolidated financial statements for the first quarter ended as of September 30, 2019.

XML

Schedule of Future Minimum Rental Payments for Operating Leases (Details)	Sep. 30, 2019 CAD ($)
Notes to Financial Statements [Abstract]
2019	$ 9,600
2020	9,600
2021	9,600
2022	9,600
2023	$ 9,600

XML

Accounts Payable and Accrued Liabilities (Narrative) (Details) - USD ($)	Sep. 30, 2019	Jun. 30, 2019
Notes to Financial Statements [Abstract]
Accounts payable and accrued liabilities	$ 7,854	$ 17,857
Legals Fees Payable	980
Audit Fees And Accounting Fees Payable	5,400
Filing fees	$ 1,474

XML

Organization, Nature of Operations and Basis of Presentation (Narrative) (Details)	Dec. 15, 2012 CNY (¥)	Dec. 15, 2012 USD ($)	Sep. 30, 2019 CNY (¥) shares	Jun. 30, 2019 shares	Jan. 31, 2012 shares
Common Stock, Shares Authorized | shares			500,000,000	500,000,000	500,000,000
Baopiao [Member]
Noncash or Part Noncash Acquisition, Interest Acquired	51.00%	51.00%
Noncash or Part Noncash Acquisition, Net Non monetary Assets Acquired (Liabilities Assumed)	¥ 2,550,000
Noncash or Part Noncash Acquisition, Debt Assumed	1,800,000	$ 289,000
Payments to Acquire Interest in Subsidiaries and Affiliates	750,000
Repayments of Debt	¥ 200,000
Other Long-term Debt			¥ 1,600,000
Period For Execution Of Agreement	20 days	20 days
Common stock reserved for issuance | shares			26,000,000

XML

Commitment and Contingencies

3 Months Ended

Sep. 30, 2019

Notes to Financial Statements [Abstract]

Commitment and Contingencies [Text Block]

Note 7 - Commitment and Contingencies

The Company leases an office space in Canada for a term under month by month operating lease agreement. Monthly rent is $616 (Cdn$800).

2019	Cdn	$	9,600
2020	Cdn	$	9,600
2021	Cdn	$	9,600
2022	Cdn	$	9,600
2023	Cdn	$	9,600

The lease agreement for the Beijing office was terminated effective from October 1, 2013.

For each of the three months ended September 30, 2019 and 2018, the Company recorded a rent expense of $1,813 (Cdn$2,400) and $1,847 (Cdn$2,400), respectively.

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Commitment and Contingencies (Narrative) (Details)	3 Months Ended
	Sep. 30, 2019 CAD ($)	Sep. 30, 2019 USD ($)	Sep. 30, 2018 CAD ($)	Sep. 30, 2018 USD ($)	Sep. 30, 2019 USD ($)
Notes to Financial Statements [Abstract]
Monthly Rent Payment	$ 800				$ 616
Operating Leases, Rent Expense	$ 2,400	$ 1,813	$ 2,400	$ 1,847

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Condensed Consolidated Balance Sheets - USD ($)	Sep. 30, 2019	Jun. 30, 2019
Current Assets
Cash	$ 2,930	$ 2,508
Other receivables	56	43
Total current assets	2,986	2,551
Non-Current Assets
Prepayments/Deposits	11,328	11,457
Total non-current assets	11,328	11,457
TOTAL ASSETS	14,314	14,008
Current liabilities
Accounts payable and accrued liabilities	7,854	17,857
Advanced for share issuance from related party	149,304	120,988
Advances from related parties and related party payables	25,003	23,452
Total current liabilities	182,161	162,297
TOTAL LIABILITIES	182,161	162,297
Shareholders' deficit
Common stock, $0.0001 par value, 500,000,000 shares authorized, 82,489,391 and 82,489,391 shares issued and outstanding as of September 30, 2019 and June 30, 2019, respectively	8,249	8,249
Additional paid-in capital	1,059,931	1,059,931
Accumulated deficit	(1,250,258)	(1,227,859)
Accumulated other comprehensive income	14,231	11,390
Total shareholders' deficit	(167,847)	(148,289)
TOTAL LIABILITIES AND SHAREHOLDERS' DEFICIT	$ 14,314	$ 14,008

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Condensed Consolidated Statements of Changes in Shareholders' Deficit - USD ($)	Common Stock [Member]	Additional Paid-in Capital [Member]	Accumulated other Comprehensive Income [Member]	Accumulated Deficit [Member]	Total
Balance at Jun. 30, 2018	$ 8,249	$ 1,059,931	$ 9,938	$ (1,178,120)	$ (100,002)
Balance (Shares) at Jun. 30, 2018	82,489,391
Foreign currency translation adjustment			361		361
Net Loss				(12,132)	(12,132)
Balance at Sep. 30, 2018	$ 8,249	1,059,931	10,299	(1,190,252)	(111,773)
Balance (Shares) at Sep. 30, 2018	82,489,391
Balance at Jun. 30, 2019	$ 8,249	1,059,931	11,390	(1,227,859)	(148,289)
Balance (Shares) at Jun. 30, 2019	82,489,391
Foreign currency translation adjustment			2,841		2,841
Net Loss				(22,399)	(22,399)
Balance at Sep. 30, 2019	$ 8,249	$ 1,059,931	$ 14,231	$ (1,250,258)	$ (167,847)
Balance (Shares) at Sep. 30, 2019	82,489,391

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Going Concern (Narrative) (Details) - USD ($)	3 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Jun. 30, 2019
Notes to Financial Statements [Abstract]
Accumulated Deficit	$ 1,250,258	$ 1,190,252	$ 1,227,859
Net Income Loss	$ 22,399	$ 12,132

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Summary of Significant Accounting Policies (Policies)

3 Months Ended

Sep. 30, 2019

Notes to Financial Statements [Abstract]

Basis of presentation [Policy Text Block]

a.    Basis of presentation.

The accompanying interim consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X as promulgated by the Securities and Exchange Commission (the "SEC"). In the opinion of management, the financial statements include all adjustments of a normal recurring nature necessary for a fair statement of the results for the periods presented. Certain information and footnote disclosures normally included in financial statements prepared in conjunction with generally accepted accounting principles have been condensed or omitted as permitted by the rules and regulations of the United States Securities and Exchange Commission ("SEC"), although the Company believes that the disclosures contained in this report are adequate to make the information presented not misleading. The unaudited consolidated balance sheet information as of September 30, 2019 was derived from the consolidated audited financial statements included in the Company's Annual Report on Form 10-K for the year ended June 30, 2019. These unaudited consolidated financial statements should be read in conjunction with the annual consolidated audited financial statements and the notes thereto included in the Company's Annual Report on Form 10-K for the year ended June 30, 2019, and other reports filed with the SEC. Operating results for the three months ended September 30, 2019 are not necessarily indicative of the results that may be expected for the full year ended June 30, 2020.

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 the U.S. dollar. Therefore, the consolidated financial statements for all periods presented have been translated into the 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 shareholders' equity.

Principles of consolidation [Policy Text Block]

c.    Principles of consolidation.

The 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 consolidated 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 consolidated 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 loss available to common stockholders by the weighted average number of common shares outstanding during the period, excluding the effects of any potentially dilutive securities. Diluted EPS gives effect to all dilutive potential of shares of common stock outstanding during the period including stock options or warrants, using the treasury stock method (by using the average stock price for the period to determine the number of shares assumed to be purchased from the exercise of stock options or warrants), and convertible debt or convertible preferred stock, using the if-converted method. EPS excludes all potential dilutive shares of common stock if their effect is anti-dilutive. There were no dilutive securities at September 30, 2019 and June 30, 2019.

Revenue [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 non-cancellable, 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. Effective January 1, 2018, the Company adopted the guidance of Accounting Standards Codification (ASC) 606, Revenue from Contracts. The implementation of ASC 606 did not have a material impact on the Company's consolidated financial statements. ASC 606 create a five-step model that requires entities to exercise judgement when considering the terms of contract, which includes (1) identifying the contracts or agreement with a customer, (2) identifying our performance obligations in the contract or agreement, (3) determining the transaction price, (4) allocating the transaction price to the separate performance obligation, and (5) recognizing revenue as each performance obligation is satisfied. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the services it transfers to its clients. The Company's revenue consists of revenue from providing travel consulting and travel arrangement advisory services ("service revenue"), and service revenue from travel schedule arrangements and advisory.

Cash and cash equivalents [Policy Text Block]

g.    Cash and cash equivalents.

The Company includes in cash and cash equivalents all short-term, highly liquid investments that mature within three months or less of their acquisition date. Cash equivalents consist principally of investments in interest-bearing demand deposit accounts and liquidity funds with financial institutions and are stated at cost, which approximates fair value. As of September 30, 2019 and June 30, 2019, 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. As of September 30, 2019, there is no property or equipment.

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 carryforwards, 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. The Company’s net operating losses carryforwards 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 consolidated results of operations, financial position, or cash flows of the Company.

Recently Issued Accounting Pronouncements

In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. The new guidance is intended to reduce diversity in practice in how certain transactions are classified in the statement of cash flows. ASU 2016-15 is effective for public business entities for fiscal years beginning after 15 December 2017, and interim periods within those years. For all other entities, it is effective for fiscal years beginning after 15 December 2018, and interim periods within fiscal years beginning after 15 December 2019. Early adoption is permitted. Entities will have to apply the guidance retrospectively, but if it is impracticable to do so for an issue, the amendments related to that issue would be applied prospectively. The Company is currently evaluating the impact of the adoption of this guidance on its consolidated financial statements, if any.

On November 17, 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash. Entities will be required to show the changes in the total of cash, cash equivalents, restricted cash and restricted cash equivalents in the statement of cash flows. As a result, entities will no longer present transfers between cash and cash equivalents and restricted cash and restricted cash equivalents in the statement of cash flows. There is no impact of the adoption of this guidance on its consolidated financial statements.

In July 2018, the FASB issued ASU No. 2018-10, Codification Improvements to Topic 842, Leases, to clarify on how to apply certain aspects of the new lease accounting standard. The amendments in this update, among other things, better articulates the requirement for a lessee's reassessment of lease classification as of the effective date of a modification, clarifies that a change to an index or rate for variable lease payments does not constitute a resolution of a contingency that would result in the remeasurement of lease payments, and requires entities that apply Topic 842 retrospectively to each reporting period and do not adopt the practical expedients to write off any prior unamortized initial direct costs that do not meet the definition under Topic 842 to equity. The amendments in this update have the same effective date and transition requirements as the new lease standard summarized above. The Company has evaluated the impact of adoption of Topic 842 on the Company's consolidated financial position and results of operations as stated above. There would be an impact of the adoption of this guidance on its consolidated financial statements for the first quarter ended as of September 30, 2019.

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Accounts Payable and Accrued Liabilities

3 Months Ended

Sep. 30, 2019

Notes to Financial Statements [Abstract]

Accounts Payable and Accrued Liabilities [Text Block]

Note 5 - Accounts Payable and Accrued Liabilities

Accounts Payable and Accrued Liabilities of $7,854 as of September 30, 2019 consists of payment of $980 in legal fees, $5,400 in audit and accounting fees and $1,474 in filing fees. (June 30, 2019 - $17,857).

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Common Stock

3 Months Ended

Sep. 30, 2019

Notes to Financial Statements [Abstract]

Common Stock [Text Block]

Note 8 - Common Stock

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

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

The Company is authorized to issue 500,000,000 shares of common stock with par value of $0.0001. As of September 30, 2019 and June 30, 2019, 82,489,391 and 82,489,391 shares of common stock were issued and outstanding, respectively.

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.

On August 5, 2016, the Company entered into Debt Conversion Agreements (the “Agreements”) with each of Lin Li and Youzhe Li, who were each creditors to the Company with total outstanding balances of $25,920 (the “Lin Li Loan”) and $78,861 (the “Youzhe Li Loan” and, together with the Lin Li Loan, the “Loans”), respectively. Pursuant to the Agreements the Company agreed to issue an aggregate total of 19,051,091 shares of its common stock, $0.0001 par value per share (the “Shares”), at the conversion rate of $0.0055 per share as full payment for the Loans. Upon issuance and delivery of the Shares, the Loans were fully paid and the Company no longer had any obligations to the individuals under the Loans.

Lin Li is the sister of Mr. Feng Li, who is the husband of Hong Ba, the Company’s director, CEO and CFO.

On August 5, 2016, the Company issued 14,338,364 common shares of the Company to such a related party in cancellation of the debt of $78,861 owed to such party at such time.

As of September 30, 2019 and June 30, 2019, the Company has received $149,304 and $120,988, respectively, advanced for a future share issuance from a related party, which amounts do not bear interest and are due on demand.

As the filing date of these financial statements, there are 82,489,391 shares issued and outstanding.

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Prepayment

3 Months Ended

Sep. 30, 2019

Notes to Financial Statements [Abstract]

Prepayment [Text Block]

Note 4 - Prepayment

As of September 30, 2019, the Company prepaid a security deposit of $11,328 (Cnd$15,000) ($11,415 - 2019) to Consumer Protection British Columbia Province for the guarantee of service quality.

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Summary of Significant Accounting Policies (Narrative) (Details)	3 Months Ended
	Sep. 30, 2019
Notes to Financial Statements [Abstract]
Depreciation Methods	straight-line method
Estimated useful lives of our property and equipment	three years

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Related Parties (Narrative) (Details)	3 Months Ended			12 Months Ended
	Sep. 30, 2019 CAD ($)	Sep. 30, 2019 USD ($)	Sep. 30, 2018 USD ($)	Jun. 30, 2019 USD ($)
Related Party Transaction, Amounts of Transaction	$ 2,400	$ 1,813	$ 1,847
Due to Other Related Parties, Current		23,562		$ 23,452
Advances from a future share issuance		$ 149,304		120,988
Percentage of stock ownership		10.00%
CEO
Proceeds from advances from related parties		$ 140		146
Feng Li [Member]
Proceeds from advances from related parties		1,100
A related party who will be an over 10% shareholder of the Company [Member]
Proceeds from advances from related parties		$ 201		$ 209

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Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Sep. 30, 2019	Jun. 30, 2019	Aug. 05, 2016	Jan. 31, 2012
Statement of Financial Position [Abstract]
Common Stock, Par Value Per Share	$ 0.0001	$ 0.0001	$ 0.0001
Common Stock, Shares Authorized	500,000,000	500,000,000		500,000,000
Common Stock, Shares, Issued	82,489,391	82,489,391
Common Stock, Shares, Outstanding	82,489,391	82,489,391

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Organization, Nature of Operations and Basis of Presentation

3 Months Ended

Sep. 30, 2019

Notes to Financial Statements [Abstract]

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

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

WE 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 WE 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 OTC Markets was also changed to WESC.

During the quarter 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 WE 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 pay Baopiao RMB200,000 as repayment of the Debt and satisfy the remaining Debt of RMB1,600,000 within 20 days 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.