Other Long-Term Assets – Deposits, Net

12 Months Ended

Jun. 30, 2023

Other Long Term Assets Deposits [Abstract]

OTHER LONG-TERM ASSETS – DEPOSITS, NET

Note 9. OTHER LONG-TERM ASSETS – DEPOSITS, NET

The Company’s other long-term assets – deposits are as follows:

	June 30,			June 30,
	2023			2022
Rental and utilities deposits	$	244,923		$	246,581
Freight logistics deposits (1)		-			-
Total other long-term assets - deposits	$	244,923		$	246,581
Less: allowances for deposits		(8,157	)		(8,832	)
Other long-term assets- deposits, net	$	236,766		$	237,749

(1) On March 8, 2018, the Company entered into contract with BaoSteel Resources Co., Ltd (“BaoSteel”) to provide supply chain services for BaoSteel. The contract required the Company to pay BaoSteel approximately $3.1 million (RMB 20 million) of deposit. This refundable deposit is to cover any possible loss of merchandise, as well as any non-performance on the part of the Company and its vendors. The restricted deposit is expected be repaid to the Company when either the contract term expires by March 2023 or the contract is terminated by either party. Due to impact of COVID-19 and recent rising freight costs, the Company has not been able to fulfill the contract to BaoSteel  and expect it may not be able to collect the full deposit, as such the Company provided full allowance for the $3.1 million deposit with BaoSteel in fiscal year 2021. During fiscal year 2022, the Company wrote off the $3.1 million deposit.

Movements of allowance for deposits are as follows:

	June 30,			June 30,
	2023			2022
Beginning balance	$	8,832		$	3,177,127
Allowance for deposits		-			-
Less: Write-off		-			(3,173,408	)
Exchange rate effect		(675	)		5,113
Ending balance	$	8,157		$	8,832