Note 2 - Variable Interest Entities

9 Months Ended

Sep. 30, 2024

Notes to Financial Statements

Variable Interest Entities Disclosure [Text Block]

2. Variable interest entities

The Company is not an operating company in China, but a Nevada holding company with no equity ownership in the VIEs. The Company primarily conducts its operations in China through its PRC subsidiaries, the VIEs, with which the Company has entered into contractual arrangements, and their subsidiaries in China. Summarized below is the information related to the VIEs’ assets and liabilities reported in the Company’s condensed consolidated balance sheets as of September 30, 2024 and December 31, 2023, respectively:

	September 30, 2024		December 31, 2023
	US$(’000)		US$(’000)
	(Unaudited)
Assets
Current assets:
Cash and cash equivalents	$	82	$	367
Accounts receivable, net		279		844
Prepayment and deposit to suppliers		1,971		2,005
Other current assets, net		-		2
Total current assets		2,332		3,218
Property and equipment, net		97		139
Deferred tax assets, net		410		401
Total Assets	$	2,839	$	3,758
Liabilities
Current liabilities:
Accounts payable	$	230	$	201
Advance from customers		700		843
Accrued payroll and other accruals		18		37
Taxes payable		2,586		2,555
Lease payment liability related to short-term leases		101		99
Other current liabilities		506		56
Total current liabilities		4,141		3,791
Total Liabilities	$	4,141	$	3,791

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 nine and three months ended September 30, 2024 and 2023, respectively:

	Nine Months Ended September 30,						Three Months Ended September 30,
	2024			2023			2024			2023
	US$(’000)			US$(’000)			US$(’000)			US$(’000)
	(Unaudited)			(Unaudited)			(Unaudited)			(Unaudited)
Revenues	$	9,740		$	25,098		$	539		$	9,157
Cost of revenues		(9,674	)		(25,023	)		(543	)		(8,975	)
Total operating expenses		(1,204	)		(1,179	)		(92	)		(436	)
Net loss		(1,167	)		(1,326	)		(100	)		(259	)