XML 31 R16.htm IDEA: XBRL DOCUMENT

Note 8 - Other Current Assets, Net

12 Months Ended

Dec. 31, 2022

8.	Other current assets, net

	December 31, 2022			December 31, 2021
	US$(’000)			US$(’000)

Short-term loans to unrelated parties		2,197			1,646
Short-term loans interest receivables		22			-
Staff advances for business operations		8			11
Total other current assets		2,227			1,657
Allowance for doubtful accounts		(617	)		-
Other current assets, net		1,610			1,657

In fiscal 2022, the Company provided unsecured, interest-bearing short-term working capital loans to two unrelated parties, which were set forth as below. These short-term working capital loans were recorded as other current assets.

On January 5, 2022, the Company provided a short-term working capital loan of US$2.5 million to an unrelated party, which would mature on May 5, 2022. The loan was unsecured and borne a fixed annualized interest rate of 7.5%. On April 25, 2022, the Company and this unrelated party entered into a supplementary contract, based on which, the unrelated party repaid a portion of the loan principal of US$1.02 million, together with a loan interest of US0.06 million for the period from January 5, 2022 through April 30, 2022, based on the loan principal of US$2.5 million. In addition, the Company agreed to extend the term of the remaining loan principal of US$1.48 million to October 31, 2022 with a revised fixed annualized interest rate of 5%. On October 31, 2022, the Company further extended the term of this loan to April 30, 2023. In October 2022, the Company received the loan interest of approximately US$0.03 million for the period from May 1, 2022 through September 30, 2022. In February 2023, the Company received the loan interest of approximately US$0.02 million for the period from October 1, 2022 through December 31, 2022.

On April 21, 2022, the Company provided a short-term working capital loan of US$0.10 million to another unrelated party, which would mature on December 31, 2022. The loan is unsecured and bears a fixed annualized interest rate of 5%. The loan and the related loan interest was required to be repaid in lump sum at maturity on December 31, 2022. The term of this loan was further extended to March 17, 2023 with the same interest rate for the extended period. On March 17, 2023, the Company fully collected the loan principal of US$0.10 million together with a loan interest of approximately US$0.005 million for the period from April 21, 2022 through March 17, 2023.

As of December 31, 2022, other current assets also included a US$0.62 million remaining outstanding balance of a working capital loan that the Company provided to an unrelated party, Digital Sun Ventures Limited, a Hong Kong-based company (“Digital Sun”). In March 2021, the Company and Digital Sun reached an oral agreement, pursuant to which the Company provided a working capital loan of US$1.65 million to Digital Sun. The loan has a one-year term. The loan is unsecured, interest free and is required to be repaid in lump sum at maturity by March 2022.

The Company provided this unsecured and interest free loan to Digital Sun in consideration of the promises and claims made by Digital Sun’s management that Digital Sun has close connections with international well-known media companies seeking for strategic cooperation partners in China, and Digital Sun will facilitate building strategic business partnerships among the Company and these media companies.

As of March 31, 2022, Digital Sun had repaid US$1.03 million of this loan and defaults on the loan balance of US$0.62 million. The Company attempted to collect the outstanding loan balance. In June 2022, the Company fully allowanced the outstanding loan balance of US$0.62 million based on the Company’s assessment of the collectability of this outstanding balance. The Company had engaged a law firm and prepared and sent a legal letter to Digital Sun in March 2023, and the Company intends to take further actions to safeguard its rights against the default, including but not limited to, arranging meetings with the management of Digital Sun to negotiate the repayment plan in person and filing a lawsuit against Digital Sun after all other means of collection have been exhausted. As of the date hereof, the Company has not received any formal responses from Digital Sun.