Note 2 - Variable Interest Entities

6 Months Ended

Jun. 30, 2022

Notes to Financial Statements

Variable Interest Entities Disclosure [Text Block]

2. Variable interest entities

To satisfy PRC laws and regulations, the Company conducts certain business in the PRC through its PRC subsidiaries and operating entities (the “VIEs”).

Summarized below is the information related to the VIEs’ assets and liabilities reported in the Company’s condensed consolidated balance sheets as of June 30, 2022 and December 31, 2021, respectively:

	June 30, 2022		December 31, 2021
	US$(’000)		US$(’000)
	(Unaudited)
Assets
Current assets:
Cash and cash equivalents	$	577	$	181
Accounts receivable, net		3,238		2,796
Prepayment and deposit to suppliers		3,429		5,287
Due from related parties		15		90
Other current assets, net		3		4
Total current assets		7,262		8,358
Long-term investments		471		496
Operating lease right-of-use assets		250		21
Property and equipment, net		138		168
Long-term deposits and prepayments		49		-
Deferred tax assets, net		423		441
Total Assets	$	8,593	$	9,484
Liabilities
Current liabilities:
Accounts payable	$	567	$	1,119
Advance from customers		735		1,113
Accrued payroll and other accruals		61		83
Taxes payable		2,714		2,849
Operating lease liabilities		195		9
Lease payment liability related to short-term leases		105		110
Other current liabilities		48		53
Total current liabilities		4,425		5,336
Operating lease liabilities-Non current		48		10
Total Liabilities	$	4,473	$	5,346

All of the VIEs' assets can be used to settle obligations of their primary beneficiary. Liabilities recognized as a result of consolidating these VIEs do not represent additional claims on the Company’s general assets.

Summarized below is the information related to the financial performance of the VIEs reported in the Company’s condensed consolidated statements of operations and comprehensive loss for the six and three months ended June 30, 2022 and 2021, respectively:

	Six Months Ended June 30,						Three Months Ended June 30,
	2022			2021			2022			2021
	US$(’000)			US$(’000)			US$(’000)			US$(’000)
	(Unaudited)			(Unaudited)			(Unaudited)			(Unaudited)
Revenues	$	13,862		$	20,618		$	6,664		$	12,671
Cost of revenues		(14,544	)		(23,132	)		(7,026	)		(14,394	)
Total operating expenses		(848	)		(712	)		(589	)		(322	)
Net loss before allocation to noncontrolling interests		(1,553	)		(3,407	)		(968	)		(2,126	)