0001477932-13-001448.txt : 20130329 0001477932-13-001448.hdr.sgml : 20130329 20130329170722 ACCESSION NUMBER: 0001477932-13-001448 CONFORMED SUBMISSION TYPE: 10-K PUBLIC DOCUMENT COUNT: 11 CONFORMED PERIOD OF REPORT: 20121231 FILED AS OF DATE: 20130329 DATE AS OF CHANGE: 20130329 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FLURIDA GROUP INC CENTRAL INDEX KEY: 0001430960 STANDARD INDUSTRIAL CLASSIFICATION: WHOLESALE-HARDWARE & PLUMBING & HEATING EQUIPMENT & SUPPLIES [5070] IRS NUMBER: 260688130 STATE OF INCORPORATION: NV FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-54310 FILM NUMBER: 13728264 BUSINESS ADDRESS: STREET 1: 800 W 5TH AVENUE STREET 2: SUITE 210 CITY: NAPERVILLE STATE: IL ZIP: 60563 BUSINESS PHONE: 630 778 8519 MAIL ADDRESS: STREET 1: 800 W 5TH AVENUE STREET 2: SUITE 210 CITY: NAPERVILLE STATE: IL ZIP: 60563 10-K 1 flug_10k.htm FORM 10-K flug_10k.htm


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K
 
(Mark One)
 
x
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
   
 
For the fiscal year ended December 31, 2012
 
OR
 
o
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 333-151200

FLURIDA GROUP, INC.
((Exact name of registrant as specified in its charter)

Nevada
 
3469
 
26-0688130
(State or other jurisdiction of
incorporation or organization)
 
(Primary Standard Industrial
Classification Code Number)
 
IRS I.D.
 
22 W. Washington St., Suite 1500
Chicago, IL
 
60602
(Address of principal executive offices)
 
(Zip Code)
 
Issuer’s telephone number:  630-778-6991
 
Securities registered pursuant to Section 12(b) of the Act: None
 
Securities registered pursuant to Section 12(g) of the Act: None
 
Common stock, par value $0. 001 per share
(Title of class)
_____________________
 
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.  Yes o   No x
 
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.  Yes o   No x
 
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 o
 
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive  Data File required to be submitted and posted 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 and post such files).  Yes x    No o
 
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. o
 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
 
Large accelerated filer
o
Accelerated filer
o
       
Non-accelerated filer
o
Smaller reporting company
x
(Do not check if a smaller reporting company)
   
 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act.)  Yes o   No x
 
The aggregate market value of the Registrant’s Common Stock held by non-affiliates of the Registrant (based upon the closing price of the Registrant’s Common Stock as of June 30, 2012) was approximately $116,556.80 (based on 9,713,067 shares of common stock outstanding held by non-affiliates on such date, $0.012 per share).  Shares of the Registrant’s Common Stock held by each executive officer and director and by each entity or person that, to the Registrant’s knowledge, owned 5% or more of the Registrant’s outstanding Common Stock as of June 30, 2012 have been excluded in that such persons may be deemed to be affiliates of the Registrant.  This determination of affiliate status is not necessarily a conclusive determination for other purposes.
 
The number of outstanding shares of Registrant’s Common Stock, $0.001 par value, was 39,290,827 shares as of December 31, 2012.
 


 
 

 
TABLE OF CONTENTS
 
PART I
       
         
Item 1. 
Description of Business
    4  
Item 2. 
Description of Property
    9  
Item 3. 
Legal Proceedings
    9  
Item 4. 
Mine Safety Disclosures
    9  
Item 5. 
Market for Common Equity and Related Stockholder Matters and Small Business Issuer Purchases of Equity Securities
    10  
Item 6.
Selected Consolidated Financial Data
    11  
Item 7.
Management’s Discussion and Analysis of Financial Condition and Results of Operation
    11  
Item 7A.
Quantitative and Qualitative Disclosures About Market Risk
    18  
Item 8. 
Financial Statements
    F-1  
Item 9. 
Changes In and Disagreements With Accountants on Accounting and Financial Disclosures
    19  
Item 9A.
Controls and Procedures
    19  
Item 9B.
Other Information
    20  
Item 10.
Directors, Executive Officers, Promoters, Control Persons and Corporate Governance; Compliance with Section 16(a) of the Exchange Act
    21  
Item 11.
Executive Compensation
    23  
Item 12.
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
    26  
Item 13.
Certain Relationships and Related Transactions, and Director Independence.
    27  
Item 14.
Principal Accountant Fees and Services
    29  
Item 15.
Exhibits
    30  
 
 
2

 
 
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS AND INFORMATION
 
This Annual Report on Form 10-K, the other reports, statements, and information that we have previously filed or that we may subsequently file with the Securities and Exchange Commission, or SEC, and public announcements that we have previously made or may subsequently make include, may include, incorporate by reference or may incorporate by reference certain statements that may be deemed to be “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and are intended to enjoy the benefits of that act. Unless the context is otherwise, the forward-looking statements included or incorporated by reference in this Form 10-K and those reports, statements, information and announcements address activities, events or developments that Flurida Group, Inc. (hereinafter referred to as “we,” “us,” “our,” “our Company” or “Flurida Group”) expects or anticipates, will or may occur in the future. Any statements in this document about expectations, beliefs, plans, objectives, assumptions or future events or performance are not historical facts and are forward-looking statements. These statements are often, but not always, made through the use of words or phrases such as “may,” “should,” “could,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “will continue,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “projection,” “would” and “outlook,” and similar expressions. Accordingly, these statements involve estimates, assumptions and uncertainties, which could cause actual results to differ materially from those expressed in them. Any forward-looking statements are qualified in their entirety by reference to the factors discussed throughout this document. All forward-looking statements concerning economic conditions, rates of growth, rates of income or values as may be included in this document are based on information available to us on the dates noted, and we assume no obligation to update any such forward-looking statements. It is important to note that our actual results may differ materially from those in such forward-looking statements due to fluctuations in interest rates, inflation, government regulations, economic conditions and competitive product and pricing pressures in the geographic and business areas in which we conduct operations, including our plans, objectives, expectations and intentions and other factors discussed elsewhere in this Report.
 
Certain risk factors could materially and adversely affect our business, financial conditions and results of operations and cause actual results or outcomes to differ materially from those expressed in any forward-looking statements made by us, and you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made and we do not undertake any obligation to update any forward-looking statement or statements to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events. The risks and uncertainties we currently face are not the only ones we face. New factors emerge from time to time, and it is not possible for us to predict which will arise. There may be additional risks not presently known to us or that we currently believe are immaterial to our business. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. If any such risks occur, our business, operating results, liquidity and financial condition could be materially affected in an adverse manner. Under such circumstances, you may lose all or part of your investment.
 
The industry and market data contained in this report are based either on our management’s own estimates or, where indicated, independent industry publications, reports by governmental agencies or market research firms or other published independent sources and, in each case, are believed by our management to be reasonable estimates. However, industry and market data is subject to change and cannot always be verified with complete certainty due to limits on the availability and reliability of raw data, the voluntary nature of the data gathering process and other limitations and uncertainties inherent in any statistical survey of market shares. We have not independently verified market and industry data from third-party sources. In addition, consumption patterns and customer preferences can and do change. As a result, you should be aware that market share, ranking and other similar data set forth herein, and estimates and beliefs based on such data, may not be verifiable or reliable.
 
 
3

 
 
PART I
 
Item 1. Description of Business
 
Organization
 
Flurida Group, Inc. is a Nevada corporation formed on December 19, 2006, with registered address at 502 East John Street, Carson City, NV 89706. Flurida Group, Inc. transacts its business in the U.S. as Flurida Group USA, Inc. located in the State of Illinois and has principal office at 22 W. Washington St., Suite 1500, Chicago, IL 60602, USA. Our telephone number is 630.778.6991.
 
Besides USA operation, Flurida Group, Inc. also established one representative office in China and one subsidiary in Europe:
 
Flurida Group Qingdao Office. (“Flurida Qingdao”): Flurida Group Qingdao Office is registered on December 10, 2007. It is a representative office on behalf of Flurida Group, Inc. to conduct the business of trading services, distribution, and marketing of the appliance parts in China. The Flurida Group Qingdao Office is located at Room 301, Unit 1, Yulong Building, 19 Miaoling Road, Qingdao, China 266061. The company closed its Flurida Qingdao China office in July, 2009.
 
Flurida Group European S.R.L (“Flurida European”): Flurida Group European S.R.L. was established on December 28, 2007 and is 100% owned by Flurida Group, Inc. Flurida European is in the business of trading services, distribution, and marketing of the appliance parts in Europe. The Flurida European office was closed in July 2012
 
Flurida Group leased a warehouse at 24412 S Main Street, Carson, CA 90745 on September 1, 2010.
 
Business
 
Our main business is the sale of appliance parts in Asia, Europe, Australia, North and South America.
 
We also sold stove, thermostat and other electronic components in 2012.

Our Main Products

We sell the following main types of appliance parts:
 
 
·
Automatic Refrigerator Build-in Icemaker: The automatic refrigerator build-in icemaker is designed for household refrigeration products, such as refrigerator, under-counter refrigerator, freezer to make the ice cubes automatically.

 
·
Refrigerator Through-Door or In-Door Ice Water System: Refrigeration Through-Door Ice Water System is the system that stores the ice cubes harvested from the icemaker, delivered and dispensed the ice, crushed ice or water to the refrigerator door through the electronic control system at the front of the refrigerator door. The through-door ice water system normally includes the following assemblies: ice bucket assembly, motor rail assembly, module assembly, facade assembly, housing assembly. The ice bucket assembly and the motor rail assembly can be located in the freezer, in the refrigerator door and or sealed chamber in the refrigerator. The module assembly, facade assembly and housing assembly vary according to the specific design from each client.

 
·
Shade Pole Motor and Motor Assembly for Refrigerator or Freezers: The shade pole motor and motor assembly is a key part for refrigerators or freezers. Flurida Group Inc’s motor part is designed and specified for the refrigerators or freezers made by Electrolux, an US with headquarters in Charlotte NC. Flurida also supplies the motors and motor assemblies to Electrolux Europe facilities in Italy and Hungary.
 
 
4

 

For the fiscal year ended December 31, 2012, the Company had total net revenue of $16,007,275.

For the period January 1 to December 31, 2012, the Company sold icemakers and motors to, Electrolux USA, located at Charlotte NC for sales of $10,991,669. The icemakers and motors were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd; all the icemakers and motors were shipped out at FOB shipping point Nanjing, China.

The company also sold motors, to Stanco Metal Products for $140,884; the motors were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd; all the motors were shipped out at FOB shipping point Nanjing, China.

For the fiscal year ended December 31, 2012, the Company sold icemakers, components, and tooling service to Electrolux –Australia for $964,720. The icemakers and components were manufactured and supplied by Chu Zhou Fu Da Mechanical and Electronics; all the icemakers and components were shipped out at FOB shipping point Nanjing, China.

The Company sold DAC Boxes, Deflector, push buttons, Magnets, Motors and other related parts to Electrolux –Italy for total $618,458. The DAC Boxes, Magnets, Motors and other related parts were manufactured and supplied by Zhong Nan Fu Rui and ChuZhou Fuda; all the DAC Boxes, magnets, and motors were shipped out at FOB shipping point Qingdao and Nanjing, China.

The Company also sold DAC Boxes, Magnets, Motors, and other related parts to Electrolux – Hungry for total $1,535,908. The DAC Boxes, magnets and Motors were manufactured and supplied by Zhong Nan Fu Rui and ChuZhou Fuda; all the DAC Boxes, magnet, and motors were shipped out at FOB shipping point Qingdao and Nanjing, China.

The Company also sold DAC Boxes and related parts to Electrolux –Sweden for $24,141. The DAC Box and parts were manufactured and supplied by Zhong Nan Fu Rui and ChuZhou Fuda; all the DAC Boxes were shipped out at FOB shipping point Qingdao and Nanjing, China.

The company sold Motors, icemakers, and some related refrigerator appliance parts to North Carolina Electrolux Major Appliances, Inc for $241,818. The parts, icemakers, and motors were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.

The Company also sold Motors to Electrolux –ST. Cloud for $98,435. The motors were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.

The Company sold Motors and other parts to Electrolux – Do Brasil for $107,662. The motors were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.

The company sold thermostats and icemakers to an US company, Exact Replacement Parts for $63,593. The parts were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.

The company sold icemakers to an US company, Domestic LLC for $90,397. And the icemakers were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd; all the icemakers were shipped out at FOB shipping point Nanjing, China.
 
The company sold parts and icemakers to General Electric Company for $34,710. The parts were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.
 
 
5

 
 
The company sold motors and components to Sigma Refrigeration Ltd for $183,120. The parts were manufactured and supplied by Zhong Nan Fu Rui, and were shipped out at FOB shipping point at Qingdao, China. The motors were manufactured and supplied by and ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.

The company sold stoves to The Paradigm Project for $197,689. The stoves were manufactured and supplied by Zhong Nan Fu Rui, and were shipped out at FOB shipping point at Qingdao, China.

For the period of January to December 31, 2012, the Company sold thermostats and other related key parts for icemakers and motors, to ChuZhouFuDa, Qingdao Fubida Electronic, and Zhong Nan Fu Rui. The parts were used for the icemakers and motors. Flurida Group purchased the parts from Wako Electronics, Inc., an US Company located at Louisville, KY 40299. Flurida Group also sold Rocker Switch, the key parts for icemakers, to Zhong Nan Fu Rui and ChuZhouFuDa. The parts, Rocker Switch, were used for the icemakers .The Company purchased the parts, Rocker Switch, from CW Industries, an US Company located at Southampton, PA; and also Flurida Group purchased some other related key parts from corporate America, and then sold to Zhong Nan Fu Rui, Qingdao Fubida Electronic, and ChuZhouFuDa. Flurida Group, Inc. adds averaged 5% - 10% margin based on the cost of purchase, then sold to them, so, $391,592, $443,841, and $13,716 were sold and invoiced to ChuZhouFuDa, Qingdao Fubida Electronic, and Zhong Nan Fu Rui respectively in the fiscal year ended December 31, 2012.
 
In the period of January 1, 2012 to December 31, 2012, the Company sold parts or provided services to America Corporation for a total of $28,912.
 
In summary, for the period of January 1 to December 31, 2012, the Company incurred the total gross sales of $16,171,265. And the Company had sales discount and return of $163,990, so, a total of $16,007,275 net sales were recorded.
 
Our Supplier
 
The products we will sell are manufactured in China by Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd. (“Zhong Nan Fu Rui”) and Chuzhou Fuda Mechanical & Electronics Co., Ltd (“ChuZhou Fuda”). Zhong Nan Fu Rui was established in 2005 specializing in home appliance components and subassemblies manufacturing, and located in Qingdao City, Shandong Province, China. On September 18, 2007, amended June 25, 2008 and further amended on August 4, 2008, Flurida Group, Inc. signed a five year distribution agreement with Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd. Zhong Nan Fu Rui is a Chinese manufacturing company owned 100% by Mr. Jianfeng Ding our president. Under the terms of the agreement Zhong Nan Fu Rui authorizes Flurida to be its exclusive sales agent for the ice making product lines, including icemaker and ice water dispensing systems. The ice making product lines shall include the products that Zhong Nan Fu Rui developed before the agreement signed and the products that will be developed solely by Zhong Nan Fu Rui during the term of the agreement. Zhong Nan Fu Rui is the exclusive supplier of the products we sell. Although the distribution agreement requires that the purchase price we will pay for these products will be comparable to what we would have paid a non-related party in arm’s-length transactions, Mr. Ding may face a conflict in calculating the price the products are sold to us and the determining amount of products we purchase. However, because Mr. Ding has a fiduciary duty to us and our shareholders, he has indicated that he will assure strict adherence to this provision of the agreement and will not require us to purchase a quantity of products in excess of that which we can reasonably afford or reasonably expect to sell in within two to three months of our purchase of the products.
 
Flurida Group also purchased the products from suppliers, Qingdao Fubida Electronics Co., Ltd, Shanghai Fulu International Trading Co., Ltd, and Chuzhou Fuda Mechanical and Electronics Co., Ltd on purchase orders basis.
 
Qingdao Fubida Electronics Co., Ltd, owned 100% indirectly by Jianfeng Ding and Yaru Huang, husband and wife. Qingdao Fubida Electronics Co., Ltd is a manufacturing company, and it was established in 2003 specializing in home appliance control components and subassemblies manufacturing, and located in Qingdao City, Shandong Province, China. The plant space is around 70,000 sq ft. 14 units injection molding machine up to 600 metric tons.
 
Shanghai Fulu International Trading Co., Ltd. a trading company established in 2007, located at Shanghai, China, 100% owned indirectly by Jianfeng Ding and Yaru Huang.
 
Chuzhou Fuda Mechanical & Electronics Co., Ltd. owned 100% indirectly by Jianfeng Ding and Yaru Huang, husband and wife is an appliance components and sub-assemblies manufacturer established on March 18, 2008. Chuzhou Fuda is located in Chuzhou City, Anhui Province, China. The plant space is around 100,000sq. ft. with 18 molding machine up to 800 metric ton and 6 assemblies lines for appliance components and assemblies.
 
 
6

 
 
At the year ended December 31, 2011, the Company had ending inventory $1,803,675 that was purchased from Zhong Nan Fu Rui and ChuZhou FuDa.
 
From the period January 1 to December 31, 2012, Flurida Group, Inc. purchased Motors, parts and stoves from Zhong Nan Fu Rui at total cost of $1,515,914 for FOB shipping point at Qingdao, China.
 
Flurida Group, Inc. also purchased Motors, Deflectors, Icemakers, Magnets, Dac Boxes, and other related parts from Qingdao Fubida Electronics Co., Ltd. at total cost of $113,103 for FOB shipping point at Qingdao, China.
 
The Company purchased Icemakers and motors from ChuZhou FuDa at total cost of $12,613,639 for FOB shipping point at Nanjing, China.
 
In addition, Flurida Group, Inc. purchased Magnets, Icemakers, Timers and related parts from Shanghai Fulu International Trading Co., Ltd., at total cost of $16,210 for FOB shipping point at Shanghai, China.
 
To manufacture the related refrigerator appliance parts, Zhong Nan Fu Rui, Chuzhou Fuda Mechanical & Electronics Co., Ltd, and Qingdao Fubida Electronics Co., needs key parts made in USA, which were purchased through Flurida Group, Inc. in USA. The costs of purchasing the parts were $852,521 in fiscal year 2012.
 
For the fiscal year ended December 31, 2012, the Company had total purchase of $15,111,387.
 
At the fiscal year ended December 31, 2012, the Company had total ending inventory $2,278,467.
 
For the period of January 1 to December 31, 2012, the company had freight cost of $22,868 and other cost of $4,439; and had a total purchase return and discount of $115,959.

Therefore, in the fiscal year ended December 31, 2012, the Company incurred a total cost of good sold of $14,547,943.
 
Customers

We sell our product to refrigerator manufacturers such as Electrolux North America, Electrolux Italy, Electrolux Hungary, Electrolux Sweden, Electrolux Australia, Master Precision Global LLC, Stanco Metal Products Inc, Sigma Refrigeration Ltd, and The Paradigm Project.
 
Markets

We sell our products in United States, Mexico, China, Europe, and Australia.

Marketing

Our products will be sold directly by our officers, directors and employees to customers and potential customers. We will locate these customers primarily by personal contacts or referrals.
 
 
7

 

Our Competition and Our Market Position 

Competition within the appliance parts industry is intense. We will compete with both large scale state-owned enterprises and smaller scale private companies. In addition, we also face competition from international appliance parts resellers. Many of our competitors have substantially greater financial, marketing, personnel and other resources than we do.
 
Our major competitor in ice maker market is Nidec Servo Corp (formal Japan Servo Co., Ltd.) and Nidec Sankyo Corp. Nidec Servo and Nidec Sankyo are both headquartered in Japan. Nidec Servo produces the aluminum tray icemaker. Nidec Sankyo produces twisted icemaker.

Our major competitors in motors for refrigerators or freezers are AO Smith in USA market, EBM in Germany, MES in Switzerland for Europe market, and Hua Yi Co., Ltd. in China market.

We compete with these and other suppliers based upon:
 
 
(1)
Our larger and more focused design group
 
(2)
We offer a wider range of products.
 
(3)
Our products are cost effective, but with highest quality control standard, all passed the ISO 9000 and UL; VDE certification.
 
(4)
We sell in a broader market throughout the world while our most competitors’ products are only sold in regional markets.

Research and Development
 
We have incurred research and development expenses in the 2012 for the total of $17,311.
 
Our Intellectual Property
 
We have no intellectual property.
 
Our Employees

We have the following number of full time employees:

Clerical
0
Operations
3
Administrative
1
Management
3
Engineers
-
3
Sales
1
 
We have no part time employees. We have no collective bargaining agreement with our employees. We consider our relationship with our employees to be excellent.
 
Additional Information
 
We are a public company and file annual, quarterly and special reports and other information with the SEC. We are not required to, and do not intend to, deliver an annual report to security holders. You may read and copy any document we file at the SEC’s public reference room at 100 F Street, N.E., Washington, D.C. 20549. You can request copies of these documents by writing to the SEC and paying a fee for the copying cost. Please call the SEC at 1-800-SEC-0330 for more information about the operation of the public reference room. Our filings are also available, at no charge, to the public at http://www.sec.gov.
 
 
8

 
 
Item 2. Description of Property

We rent the following property:
 
Flurida Group USA, Inc.
 
Address: is located at 22 W. Washington St., Suite 1500, Chicago, IL 60602.
 
 
·  
Name of Landlord: Regus Group
 
·  
Term of Lease: September 1 2012, to September 30, 2013
 
·  
Monthly Rental: $219
 
·  
Adequate for current needs: √ Yes
 
Flurida Group USA, Warehouse Location

 
·  
Address: 24412 S Main ST, Carson, CA 90745
 
·  
Name of Land Lord: 24412 S Main Street, LLC
 
·  
Term of Lease: September 1, 2012 to August 31, 2013
 
·  
Monthly Rent: $3,938
 
·  
Square Feet: Approximately 5,168 square feet
 
·  
Adequate for current needs: Yes

We do not intend to renovate, improve, or develop properties. We are not subject to competitive conditions for property and currently have no property to insure. We have no policy with respect to investments in real estate or interests in real estate and no policy with respect to investments in real estate mortgages. Further, we have no policy with respect to investments in securities of or interests in persons primarily engaged in real estate activities.
 
Item 3. Legal Proceedings

We are not a party to any material legal proceedings nor are we aware of any circumstance that may reasonably lead any third party to initiate material legal proceedings against us.
 
Item 4. Mine Safety Disclosures

None
 
 
9

 
 
PART II
 
Item 5. Market for Common Equity and Related Stockholder Matters and Small Business Issuer Purchases of Equity Securities
 
MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
 
Trading History
 
Our common stock is quoted on the Over-The-Counter Bulletin Board under the symbol “FLUG.”
 
Bid Information*
 
Financial Quarter Ended
 
High Bid
   
Low Bid
 
December 31, 2012
 
$
0.15
   
$
0.10
 
September 30, 2012
 
$
0.15
   
$
0.10
 
June 30, 2012
 
$
0.10
   
$
0.012
 
March 31, 2012
 
$
0.15
   
$
0.10
 
December 31, 2011
 
$
0.15
 
 
$
0.10
 
September 30, 2011
 
$
0.15
 
 
$
0.10
 
June 30, 2011
 
$
0.15
 
 
$
0.10
 
March 31, 2011
 
$
0.15
 
 
$
0.10
 
 
* The quotation do not reflect inter-dealer prices, without retail mark-up, mark-down or commission and may not represent actual transactions.
 
Dividends
 
We have never declared or paid any cash dividends on our common stock. For the foreseeable future, we intend to retain any earnings to finance the development and expansion of our business, and we do not anticipate paying any cash dividends on our common stock. Any future determination to pay dividends will be at the discretion of the Board of Directors and will be dependent upon then existing conditions, including our financial condition and results of operations, capital requirements, contractual restrictions, business prospects and other factors that the Board of Directors considers relevant.
 
There are no restrictions in our articles of incorporation or bylaws that prevent us from declaring dividends. The Nevada Revised Statutes, however, prohibit us from declaring dividends where, after giving effect to the distribution of the dividend:
 
 
we would not be able to pay our debts as they become due in the usual course of business; or
 
 
our total assets would be less than the sum of our total liabilities plus the amount that would be needed to satisfy the rights of stockholders who have preferential rights superior to those receiving the distribution, unless otherwise permitted under our articles of incorporation.
 
 
10

 
 
Securities Authorized for Issuance Under Equity Compensation Plans
 
At December 31, 2012, we have one compensation plan in place, entitled 2009 Stock Incentive Plan. This plan was approved by our Board of Directors on July 10, 2009.
 
Number of 
Securities to
be issued under Plan
   
Weighted-Average
exercise price of
outstanding options
   
Number of securities
remaining available 
for further issuance
 
  5,000,000    
$
0.60
     
5,000,000
 
 
Item 6. Selected Consolidated Financial Data
 
Not required.
 
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operation
 
Overview

Our business is the sale of appliance parts in Asia, Europe, Australia, North and South America. The main products that we sell to these markets are icemakers, motors, ice water dispensing system, and appliance assemblies.

These parts are manufactured in China by Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd. (“Zhong Nan Fu Rui”) and Chuzhou Fuda Mechanical & Electronics Co., Ltd (“ChuZhou Fuda”)

Zhong Nan Fu Rui was established in 2005 specializing in home appliance components and subassemblies manufacturing, and located in Qingdao City, Shandong Province, China. On September 18, 2007, amended June 25, 2008 and further amended on August 4, 2008, Flurida Group, Inc. signed a long-term distribution agreement with Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd. Zhong Nan Fu Rui is a Chinese manufacturing company owned 100% by Mr. Jianfeng Ding, our president.
 
Flurida Group also purchased the products from suppliers, Qingdao Fubida Electronics Co., Ltd, Shanghai Fulu International Trading Co., Ltd, and Chuzhou Fuda Mechanical and Electronics Co., Ltd on purchase orders basis.

Qingdao Fubida Electronics Co., Ltd, owned 100% indirectly by Jianfeng Ding and Yaru Huang, husband and wife. Qingdao Fubida Electronics Co., Ltd is a manufacturing company, and it was established in 2003 specializing in home appliance control components and subassemblies manufacturing, and located in Qingdao City, Shandong Province, China. The plant space is around 70,000 sq ft. 14 units injection molding machine up to 600 metric tons.

Shanghai Fulu International Trading Co., Ltd. a trading company established in 2007, located at Shanghai, China, 100% owned indirectly by Jianfeng Ding and Yaru Huang.

Chuzhou Fuda Mechanical & Electronics Co., Ltd. owned 100% indirectly by Jianfeng Ding and Yaru Huang, husband and wife is an appliance components and sub-assemblies manufacturer established on March 18, 2008. Chuzhou Fuda is located in Chuzhou City, Anhui Province, China. The plant space is around 100,000 sq. ft. with 18 molding machine up to 800 metric ton and 6 assemblies lines for appliance components and assemblies.
 
 
11

 
 
We sell the following main types of appliance parts:
 
 
·
Automatic Refrigerator Build-in Icemaker: The automatic refrigerator build-in icemaker is designed for household refrigeration products, such as refrigerator, under-counter refrigerator, freezer to make the ice cubes automatically.

 
·
Refrigerator Through-Door Ice Water System: Refrigeration Through-Door Ice Water System is the system that stores the ice cubes harvested from the icemaker, delivered and dispensed the ice, crushed ice or water to the refrigerator door through the electronic control system at the front of the refrigerator door. The through-door ice water system normally includes the following assemblies: ice bucket assembly, motor rail assembly, module assembly, facade assembly, housing assembly. The ice bucket assembly and the motor rail assembly can be located in the freezer, in the refrigerator door and or sealed chamber in the refrigerator. The module assembly, facade assembly and housing assembly vary according to the specific design from each client.

 
·
Shade Pole Motor and Motor Assembly for Refrigerator or Freezers: The shade pole motor and motor assembly is a key part for refrigerators or freezers. Flurida Group Inc’s motor part is designed and specified for the refrigerators or freezers made by Electrolux, an US company with headquarter in Charlotte, NC. Flurida also supplies the motors and motor assemblies to Electrolux Europe facilities in Italy and Hungary.
 
We are an “emerging growth company” (“EGC”) that is exempt from certain financial disclosure and governance requirements for up to five years as defined in the Jumpstart Our Business Startups Act (“the JOBS Act”), that eases restrictions on the sale of securities; and increases the number of shareholders a company must have before becoming subject to the U.S. Securities and Exchange Commission’s (SEC’s) reporting and disclosure rules (See “Emerging Growth Companies” section above). We have elected to use the extended transition period for complying with new or revised accounting standards under Section 102(b)(2) of the Jobs Act, that allows us to delay the adoption of new or revised accounting standards that have different effective dates for public and private companies until those standards apply to private companies. As a result of this election, our financial statements may not be comparable to companies that comply with public company effective dates.
 
Results of Operations
 
For the fiscal years ended December 31, 2012 vs. December 31, 2011.

Revenue

For the fiscal year ended December 31, 2011, the Company had net total revenue of $13,780,374 to the Company’s Europe, North and South America customers.

For the fiscal year ended December 31, 2012, the Company had net total revenue of $16,007,275, which was increased nearly 16% than the year 2011 total revenue of $13,780,374

For the period January 1 to December 31, 2012, the Company sold icemakers and motors to, Electrolux USA, located at Charlotte NC for sales of $ 10,991,669. The icemakers and motors were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd; all the icemakers and motors were shipped out at FOB shipping point Nanjing, China.

The company also sold motors, to Stanco Metal Products for $140,884; the motors were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd; all the motors were shipped out at FOB shipping point Nanjing, China.

For the fiscal year ended December 31, 2012, the Company sold icemakers, components, and tooling service to Electrolux –Australia for $964,720. The icemakers and components were manufactured and supplied by Chu Zhou Fu Da Mechanical and Electronics; all the icemakers and components were shipped out at FOB shipping point Nanjing, China.

The Company sold DAC Boxes, Deflector, push buttons, Magnets, Motors and other related parts to Electrolux –Italy for total $618,458. The DAC Boxes, Magnets, Motors and other related parts were manufactured and supplied by Zhong Nan Fu Rui and ChuZhou Fuda; all the DAC Boxes magnets, and motors were shipped out at FOB shipping point Qingdao and Nanjing, China.

The Company also sold DAC Boxes, Magnets, Motors, and other related parts to Electrolux – Hungry for total $1,535,908. The DAC Boxes, magnets and Motors were manufactured and supplied by Zhong Nan Fu Rui and ChuZhou Fuda; all the DAC Boxes magnet, and motors were shipped out at FOB shipping point Qingdao and Nanjing, China.
 
 
12

 

The Company also sold DAC Boxes and related parts to Electrolux –Sweden for $24,141. The DAC Box and parts were manufactured and supplied by Zhong Nan Fu Rui and ChuZhou Fuda; all the DAC Boxes were shipped out at FOB shipping point Qingdao and Nanjing, China.

The company sold Motors, icemakers, and some related refrigerator appliance parts to North Carolina Electrolux Major Appliances, Inc for $241,818. The parts, icemakers, and motors were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.

The Company also sold Motors to Electrolux –ST. Cloud for $98,435. The motors were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.

The Company sold Motors and other parts to Electrolux – Do Brasil for $107,662. The motors were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.

The company sold thermostats and icemakers to an US company, Exact Replacement Parts for $63,593. The parts were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.

The company sold icemakers to an US company, Domestic LLC for $90,397. And the icemakers were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd; all the icemakers were shipped out at FOB shipping point Nanjing, China.

The company sold parts and icemakers to General Electric Company for $34,710. The parts were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.

The company sold motors and components to Sigma Refrigeration Ltd for $183,120. The parts were manufactured and supplied by Zhong Nan Fu Rui, and were shipped out at FOB shipping point at Qingdao, China. The motors were manufactured and supplied by and ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.

The company sold stoves to The Paradigm Project for $197,689. The stoves were manufactured and supplied by Zhong Nan Fu Rui, and were shipped out at FOB shipping point at Qingdao, China.

For the period of January to December 31, 2012, the Company sold thermostats and other related key parts for icemakers and motors, to ChuZhouFuDa, Qingdao Fubida Electronic, and Zhong Nan Fu Rui. The parts were used for the icemakers and motors. Flurida Group purchased the parts from Wako Electronics, Inc., an US Company located at Louisville, KY 40299. Flurida Group also sold Rocker Switch, the key parts for icemakers, to Zhong Nan Fu Rui and ChuZhouFuDa. The parts, Rocker Switch, were used for the icemakers .The Company purchased the parts, Rocker Switch, from CW Industries, an US Company located at Southampton, PA; and also Flurida Group purchased some other related key parts from corporate America, and then sold to Zhong Nan Fu Rui, Qingdao Fubida Electronic, and ChuZhouFuDa. Flurida Group, Inc. adds averaged 5% - 10% margin based on the cost of purchase, then sold to them, so, $391,592, $443,841, and $13,716 were sold and invoiced to ChuZhouFuDa, Qingdao Fubida Electronic, and Zhong Nan Fu Rui respectively in the fiscal year ended December 31, 2012.
 
 
13

 

In the period of January 1, 2012 to December 31, 2012, the Company sold parts or provided services to America Corporation for a total of $28,912.

   
Jan - Dec 2012
   
Jan - Dec 2011
 
Electrolux- Australia
    964,719.81       519,428.13  
Electrolux-Anderson-US
    7,835,018.74       7,430,392.01  
Electrolux-Mexico
    3,156,650.67       2,591,979.36  
Eelectrolux Major Appliance
    241,817.50       299,926.84  
Eelectrolux Do Brasil
    107,661.60       6,828.00  
Electrolux - St. Cloud
    98,436.10       244,774.66  
Electrolux - Sweden
    24,140.60       36,107.37  
Electrolux Italy
    610,738.17       580,527.26  
Electrolux Italy-Professional
    7,720.00       0.00  
Eletrolux Hungry
    1,535,908.11       900,806.51  
MASTER PRECIDION GLOBAL LLC(MPG)
    0.00       461,056.18  
QINGDAO FLURIDA FLECTRONIC CO.,LTD
    443,840.66       0.00  
Stanco Metal Products Inc
    140,883.84       40,901.76  
ZhongNanFuRui
    13,716.00       440,555.64  
Chuzhou FuDa
    391,591.73       0.00  
Exact Replacement Parts
    63,592.80       45,797.50  
Sigma Refrigeration Ltd
    183,120.00       0.00  
The Paradigm Project
    197,689.20       0.00  
Mid-south Electronic Inc
    8,316.00       0.00  
New Allied Electronic
    596.00       0.00  
Del Visionaries
    20,000.00       1,350.00  
Domestic LLC
    90,396.90       2,674.75  
General Electric Company
    34,710.21       197,559.63  
Shamrock
    0.00       7,800.00  
TOTAL
    16,171,264.64       13,809,065.60  
 
In summary, for the period of January 1 to December 31, 2012, the Company incurred the total gross sales of $16,171,265. And the Company had sales discount and return of $163,990, so, a total of $16,007,275 net sales were recorded, comparing with the $13,780,374 for the year 2011, increase of 16%.
 
In both 2012 and 2011 sales, more than 80% of total revenues were generated through Electrolux controlled subsidiaries in various countries. Electrolux Group operated its each subsidiary independently in each country, and all the sales orders and sales contracts were negotiated and signed independently. Accordingly, we believe that lack of one or a few subsidiaries of Electrolux sales order may have effect on our overall sales revenue, but the effects were slightly reduced in 2012 vs 2011. We signed long-term distribution agreement with various Electrolux subsidiaries, the risk of loss the contracts with Electrolux is significantly low.

 
 
14

 
 
Cost of Revenue
 
Our Costs of Goods Sold, as we expected will increased slightly due to increasing Chinese Yuan’s currency exchange rate, labor costs, and raw materials. We anticipate this trend to continue and may adjust our unit price upward to reduce the impact of rising costs.
 
For the fiscal year ended December 31, 2011, the Company incurred a total cost of good sold of $12,400,149, for the purchases of parts, motor, and icemakers for the total sales of $13,780,374.
 
At the year ended December 31, 2011, the Company had ending inventory $1,803,675 that was purchased from Zhong Nan Fu Rui and ChuZhou FuDa.
 
From the period January 1 to December 31, 2012, Flurida Group, Inc. purchased Motors, parts and stoves from Zhong Nan Fu Rui at total cost of $1,515,914 for FOB shipping point at Qingdao, China.
 
Flurida Group, Inc. also purchased Motors, Deflectors, Icemakers, Magnets, Dac boxes, and other related parts from Qingdao Fubida Electronics Co., Ltd. at total cost of $113,103 for FOB shipping point at Qingdao, China.
 
The Company purchased Icemakers and motors from ChuZhou FuDa at total cost of $12,613,639 for FOB shipping point at Nanjing, China.
 
In addition, Flurida Group, Inc. purchased Magnets, Icemakers, Timers and related parts from Shanghai Fulu International Trading Co., Ltd., at total cost of $16,210 for FOB shipping point at Shanghai, China.
 
To manufacture the related refrigerator appliance parts, Zhong Nan Fu Rui, Chuzhou Fuda Mechanical & Electronics Co., Ltd, and Qingdao Fubida Electronics Co., needs key parts made in USA, which were purchased through Flurida Group, Inc. in USA. The costs of purchasing the parts were $852,521 in fiscal year 2012.
 
For the fiscal year ended December 31, 2012, the Company had total purchase of $15,111,387.
 
At the fiscal year ended December 31, 2012, the Company had total ending inventory $2,278,467.
 
For the period of January 1 to December 31, 2012, the company had freight cost of $22,868 and other cost of $4,439; and had a total purchase return and discount of $115,959.

Therefore, in the fiscal year ended December 31, 2012, the Company incurred a total cost of good sold of $14,547,943 which was increased nearly 17 % comparing to the year 2011 cost of goods sold of $12,400,149. The increase of cost of goods sold was due to the sales increase, increasing Chinese Yuan’s currency exchange rate, labor costs, and raw materials. 
 
The cost of goods sold in the Statements of Operations includes costs of products purchased from suppliers, shipping costs or freight in costs for the products shipping FOB port China, warehouse costs, and other costs if any directly related to the products inspection, duty and custom taxes of products, internal transfer costs if any. The selling, general and administrative expense includes operation expense such as travel, professional, office rent, telephone, certification fees, wages and salaries for management and administrative employees, and other expense related to operation. There was no allocation of portion of any selling, general and administrative expense to the cost of goods sold.
 
Our gross margin may not be comparable to those of other entities, since some other entities may include all or allocate portion of the costs related to their distribution network into cost of goods sold.
 
 
15

 
 
Expense
 
Our operation expenses consist of selling, general and administrative expenses, and research & development expenses, and depreciation expenses:
 
   
Year Ended
   
Year Ended
 
   
December 31,
   
December 31,
 
   
2012
   
2011
 
Administration Expense
    1,681       2,071  
Bad Debt Expense
    -       5,895  
Bank Service Charges
    58,182       4,449  
Business Registration
    904       1,513  
Certification Fee
    66,654       73,832  
Computer and Internet Expenses
    1,317       1,100  
Credit card Finance Charge
    218       60  
Depreciation and amortization expenses
    20,957       14,965  
Fuel charge
    3,049       883  
Gift and Promotion
    9,504       5,048  
Insurance Expense
    945       945  
Meals and Entertainment
    19,822       14,293  
Office Supplies
    8,262       12,920  
Parking fee
    864       376  
Payroll Expense - ER
    38,835       33,452  
Payroll Expenses - EE
    674,705       585,978  
Penalty & Fine Expenses
    -       218  
Postage & Shipping
    8,154       6,035  
Professional Fees
    125,781       95,009  
Rent Expense
    52,687       52,075  
Repairs and Maintenance
    3,118       6,104  
Research and development Expense
    17,311       15,191  
Service Cost
    340       4,406  
Telephone Expense
    9,891       9,284  
Travel Expense
               
Air agent fee
    2,008       789  
Airfare
    42,425       58,332  
Car Rental
    5,687       3,872  
Hotel Expense
    29,377       27,954  
Local Transportation
    590       1,511  
Travel Expense - Other
    -       1,134  
Total Travel Expense
    80,087       93,592  
Utilities
    2,401       1,142  
                 
Total Expense
  $ 1,205,671     $ 1,040,836  
 
Started from January 2011, Flurida Group had salaries for officers Jianfeng Ding, Yaru Huang, and Ying Zhong for $350,000, $80,000, $80,000. And Flurida Group USA hired employees to taking care of the office, research and development, and marketing activities, therefore, the Company incurred a total payroll expense of $619,430 for the year end December 31, 2011. For maintaining and operating the business, the Company expensed a total of $95,009 professional fee, which included the accounting and auditing service, commission and consulting fee for enlarge sales volume, SEC filling fee and other professional expenses. In order to increasing the sales in Europe and North America, the Company expensed $73,832 certification fees on the products we sold or exported in the period of January 1 to December 31, 2011. Due to the raise of sale volume and customers, the Company had travel expenses of $93,592. We have set up a Research & Development Center at LA location in 2011 and had equipment and research development expenses of $15,191.
 
 
16

 
 
Started from January 2012, Flurida Group had salaries for officers Jianfeng Ding, Yaru Huang, and Ying Zhong for $350,000, $80,000, $80,000. The Company incurred a total payroll expense of $713,541 for the year end December 31, 2012. For maintaining and operating the business, the Company expensed a total of $125,781 professional fee, which included the accounting and auditing service, commission and consulting fee for enlarge sales volume, SEC filling fee and other professional expenses. In order to increasing the sales in Europe and North America, the Company expensed $66,654 certification fees on the products we sold or exported in the period of January 1 to December 31, 2012. Due to the raise of sale volume and customers, the Company had travel expenses of $80,087, and had equipment and research development expenses of $17,311.

We expect selling, general, and administrative expenses to increase in future periods as we initiate a number of marketing and promotional activities.

Income Taxes

We are subject to income taxes in the U.S., while the subsidiary in Italy is subject to the income tax laws of Italy. We incurred income tax expense of $109,891 and $153,641 for the year ended December 31, 2012 and 2011 respectively. As of December 31, 2012, the company had income taxes payable of $0.

Net Income (Loss)

We had a net income of $155,091 and $200,501 for the year ended December 31, 2012 and 2011 respectively.
 
Commitments and Contingencies

The Company has signed a long-term distribution agreement with Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd. Zhong Nan Fu Rui is a Chinese manufacturing company owned 100% by Mr. Jianfeng Ding, also the founder of Flurida Group, Inc. Also, On June 2008, the company signed a consigned inventory agreement with an US company, Electrolux Home Products DE Mexico and Anderson, S.A.DEC.V (Electrolux).

Foreign Currency Translation
 
The Company has determined the United States dollars to be its functional currency for Flurida Group USA and European Euro to be its functional currency in European business. Assets and liabilities were translated to U.S. dollars at the period-end exchange rate. Statement of operations amounts were translated to U.S. dollars using the first date of each month during the year. Gains and losses resulting from translating foreign currency financial statements are accumulated in other comprehensive income (loss), a separate component of shareholders’ equity.
 
Liquidity and Capital Resources
 
   
At
December 31
   
At
December 31
 
   
2012
   
2011
 
             
Current Ratio *
    1.77       1.85  
Cash
  $ 194,265     $ 741,230  
Working Capital**
  $ 1,637,866     $ 1,348,331  
Total Assets
  $ 4,226,739     $ 3,622,633  
Total Liabilities
  $ 2,393,148     $ 1,962,891  
                 
Total Equity
  $ 1,833,591     $ 1,659,742  
                 
Total Debt/Equity***
    1.31       1.18  
 
*Current Ratio = Current Assets /Current Liabilities
**Working Capital = Current Assets - Current Liabilities
*** Total Debt / Equity = Total Liabilities / Total Shareholders Equity.
 
 
17

 

The Company’s overall working capital was increased in 2012 comparing to the year 2011, due to the overall increase of the accounts receivable and inventory; also, the Company’s current ratio was decreased in 2012 comparing to the year 2011 due to the increase of the accounts payable.

Currently the Company has a sales agreement with Electrolux, such agreement require the Company to supply the motors, ice makers, and other parts based on Electrolux’s needs. The management projected that the needs for our Company’s products shall be stable with slight increase worldwide. However, due to the consignment arrangement with Electrolux, the Company would keep certain level of consignment inventory to meet the Electrolux’s requirements. In addition, due to the consignment terms with Electrolux, the sales would be recognized when the Electrolux withdraw the products or the consignment inventory at Electrolux’s warehouse for 60 days. In our due course of business dealing with Electrolux’s consignment sales, all the sales incurred in 2012 were for the products withdrew before the 75 days terms, i.e., the products might be considered as sales automatically based on the consignment terms. After the products withdrew by Electrolux, the Company may receive the payment in 7 days with discount through DB Supplier Fincance.
 
Our activities for generating cash flows were operating activities in 2012 and 2011. There were no investing and financing activities incurred for the year 2012, and 2011. The management will continue to improve our current business on marketing. customer services and general administrative activities effectiveness, also we focus on develop our new products such as electronic ice maker and high efficiency LED products . We predict those products will be ready in the market later in 2012 .
 
Specifically, the management still believes that within the operating activities, the efforts of collecting accounts receivables and making payments of accounts payables still are the primary factors for the changes of cash flows in the year 2012 or later.
 
The Company had cash and cash equivalents of $ 194,265 at December 31, 2012 and $1,637,866 of working capital and $741,230 at December 31, 2011 and $1,348,331 of working capital.
 
The total debt of $2,393,148 for December 31, 2012 included total of $172,624 for Zhong Nan Fu Rui, $1,766,949 for Chu Zhou Fu Da, and $157,235 for US suppliers, $26,298 for salary and payroll tax payable, and $45,066 for all other account payable, and $224,976 unearned revenue.
 
The total debt of $1,962,891 for December 31, 2011 included total of $1,217,635 for Zhong Nan Fu Rui, $434,976 for Chu Zhou Fu Da, $134,061 for Qiongdao Fu Bi Da, $32,625 for Shang Hai Fu Lu International Trading, and $57,135 for US suppliers, $54,872 for salary and payroll tax payable, and $20,952 for all other account payable, and $10,635 unearned revenue.
 
Our independent auditor has indicated that our customer concentration may raise doubt about its ability to continue as a going concern. The financial statements do not include adjustments that might result from the outcome of this uncertainty and if the Company is unable to generate significant revenue or secure financing, then the Company may be required to cease or curtail its operations. However, due to the close relationship between the Company and it’s supplier, Zhong Nan Fu Rui, which is 100% owned by the founder, Jianfeng Ding, Zhong Nan Fu Rui’s current customers can be served by the Company for the same quality of products and services. Besides, as of December 31, 2012, the cash and cash equivalent balance was $194,265, the management believes that the revenues will be generated and its cash flows will be maintained to cover its operational costs and the risk of going concern in long term is significantly low.
 
Interest Rate Risk
 
We do not have significant interest rate risk, as our debt obligations (i.e., notes payables to shareholders which can be converted to common stocks). The annual interest rate of notes payable is 8%, and the interest expense would be accrued if the notes were not converted to common shares, and the notes holders request the Company for repayment of principles plus the interest. Seven non-affiliated loan holders asked the Company for repayment of notes plus interest on April 1, 2008. All remaining loan holders converted their loans to common shares on April 15, 2008.
 
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
 
Not required.
 
 
18

 
 
Item 8. Financial Statements
 
FLURIDA GROUP, INC.

 

Audited Financial Statements
 
As of December 31, 2012 and 2011
 
 
F-1

 

Table of Contents

Independent Auditor’s Report on the Consolidated Financial Statements
    F-3  
         
Balance Sheets
    F-4  
         
Statement of Operation
    F-5  
         
Shareholders Equity
    F-6  
         
Cash Flow Statement
    F-7  
         
Notes to Financial Statements
    F-8  
 
 
F-2

 
 
Independent Registered Public Accounting Firm’s Auditor’s Report on the Consolidated Financial Statements

Board of Directors and Shareholders of Flurida Group, Inc.

We have audited the accompanying consolidated balance sheets of Flurida Group, Inc. and Subsidiary Companies as of December 31, 2012 and 2011, and the related consolidated statements of operation, shareholders’ equity, and cash flows for year ended December 31, 2012 and 2011. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audit.
 
We conducted our audit in accordance with standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
 
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Flurida Group, Inc. and Subsidiary Companies as of December 31, 2012, and 2011, and the results of its operations and their cash flows for the year ended December 31, 2012 and 2011 in conformity with accounting principles generally accepted in the United States of America.
 
As discussed in Note E, the Company’s customer concentration may raise doubt about its ability to continue as a going concern. The financial statements do not include adjustments that might result from the outcome of this uncertainty and if the Company is unable to generate significant revenue or secure financing, then the Company may be required to cease or curtail its operations.
 
/s/ Enterprise CPAs, Ltd.
 
Enterprise CPAs, Ltd.
Chicago, IL

March 18, 2013
 
 
F-3

 
 
FLURIDA GROUP, INC.
CONSOLIDATED BALANCE SHEETS
             
   
December 31
   
December 31
 
   
2012
   
2011
 
ASSETS
Current assets:
           
Cash and cash equivalents
  $ 194,265     $ 741,230  
Accounts receivable, net
    1,558,282       766,318  
Inventory
    2,278,467       1,803,674  
Total Current Assets
  $ 4,031,014     $ 3,311,222  
                 
Property, plant and equipment, net
  $ 88,276     $ 77,737  
                 
Other assets:
               
Loan to supplier
  $ 101,185     $ 224,602  
Accrued interest receivable
    -       2,808  
Security deposit
    6,264       6,264  
Total Other Assets
  $ 107,449     $ 233,674  
                 
TOTAL ASSETS
  $ 4,226,739     $ 3,622,633  
LIABILITIES & EQUITY
                 
Current liabilities:
               
Account payable
  $ 2,168,172     $ 1,952,256  
Income taxes payable
    -       -  
Unearned revenue
    224,976       10,635  
Total current liabilities
  $ 2,393,148     $ 1,962,891  
                 
Stockholders' Equity:
               
Common stock, $0.001 par value;
               
200,000,000 shares authorized;
               
39,290,827 shares issued and outstanding.
  $ 39,291     $ 38,991  
                 
Paid-in capital
    1,251,313       1,221,613  
                 
Retained earnings
    543,164       388,073  
                 
Accumulated other comprehensive Income (loss)
    (177 )     11,065  
                 
Total stockholders' equity
  $ 1,833,591     $ 1,659,742  
                 
TOTAL LIABILITIES & EQUITY
  $ 4,226,739     $ 3,622,633  

 
F-4

 
 
FLURIDA GROUP, INC.
CONSOLIDATED STATEMENT OF OPERATION
       
   
Year Ended
   
Year Ended
 
   
December 31,
   
December 31,
 
   
2012
   
2011
 
             
Revenues:
  $ 16,007,275     $ 13,780,374  
Cost of Goods Sold
  $ 14,547,943     $ 12,400,149  
Gross Profit
  $ 1,459,332     $ 1,380,225  
Operating expenses:
               
Research and development
    17,311       15,191  
                 
Selling, general and administrative expenses
    1,167,403       1,010,680  
                 
Depreciation and amortization expenses
    20,957       14,965  
Total Operating Expenses
    1,205,671       1,040,836  
                 
Operating Income
  $ 253,661     $ 339,389  
                 
Investment income, net
  $ 13,543     $ 14,753  
Interest Expense, net
    2,222       -  
Income before taxes
  $ 264,982     $ 354,142  
Income tax expense
    109,891       153,641  
Net Income
  $ 155,091     $ 200,501  
                 
Net Income (Loss) per common share-Basics
  $ 0.00     $ 0.01  
Net Income (Loss) per common share-Diluted
  $ 0.00     $ 0.01  
                 
Other comprehensive Income(Loss), net of tax:
               
Foreign currency translation adjustments
    (11,242 )     5,542  
Total other comprehensive Income(Loss)
  $ (11,242 )   $ 5,542  
Comprehensive Income (Loss)
  $ 143,849     $ 206,043  

 
F-5

 
 
FLURIDA GROUP, INC.
CONSOLIDATED STATEMENT OF STOCKHOLDERS EQUITY
FOR THE PERIOD ENDED DECEMBER 31, 2012
                                     
               
Additional
         
Accumulated Other
   
Total
 
   
Common Stock
   
Paid-in
   
Retained
   
Comprehensive
   
Stockholders'
 
   
Shares
   
Amount
   
Capital
   
Earnings
   
Income (Loss)
   
Equity
 
                                         
Balance, December 31, 2006
                    $ (1,500 )         $ (1,500 )
                                         
Balance, December 31, 2007
    27,291,760     $ 27,292     $ 63,406     $ (20,619 )   $ (126 )   $ 69,953  
                                                 
Balance, December 31, 2008
    38,990,827     $ 38,991     $ 1,221,613     $ (214,698 )   $ 29,471     $ 1,075,377  
                                                 
Balance, December 31, 2009
    38,990,827     $ 38,991     $ 1,221,613     $ (23,633 )   $ 48,979     $ 1,285,950  
                                                 
Adjustment for Exchange
                                               
   rate changes
                                  $ (43,456 )   $ (43,456 )
                                                 
Net Income for the year
                                               
  ended December 31, 2010
                          $ 211,205             $ 211,205  
                                                 
Balance, December 31, 2010
    38,990,827     $ 38,991     $ 1,221,613     $ 187,572     $ 5,523     $ 1,453,699  
                                                 
Adjustment for Exchange
                                               
   rate changes
                                  $ 5,542     $ 5,542  
                                                 
Net Income for the year
                                               
  ended December 31, 2011
                          $ 200,501             $ 200,501  
                                                 
Balance, December 31, 2011
    38,990,827     $ 38,991     $ 1,221,613     $ 388,073     $ 11,065     $ 1,659,742  
                                                 
Issuance of common
                                               
  stocks to Williams @ 0.10
                                               
  per share on November 1, 2012
    300,000     $ 300     $ 19,800                     $ 30,000  
                                                 
Adjustment for Exchange
                                               
   rate changes
                                  $ (11,242 )   $ (11,242 )
                                                 
Net Income for the year
                                               
  ended December 31, 2012
                          $ 155,091             $ 155,091  
                                                 
Balance, December 31, 2012
    39,290,827     $ 39,291     $ 1,251,313     $ 543,164     $ (177 )   $ 1,833,591  

 
F-6

 
 
FLURIDA GROUP, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
             
   
Year Ended
   
Year Ended
 
   
December 31
   
December 31
 
   
2012
   
2011
 
Operating Activities:
           
Net Income
  $ 155,091     $ 200,501  
Adjustments to reconcile net income to net cash
               
provided by operating activities:
               
Non-cash portion of share based legal fee expense
    30,000       -  
Depreciation Expense
    20,957       14,965  
Inventory
    (474,793 )     (270,454 )
Decrease in accrued interest receivable
    2,808       19,497  
Increase in account receivable
    (791,964 )     1,516,322  
Increase in account payable
    215,916       (1,680,392 )
Decrease in income tax payable
    -       (79,307 )
Increase in Unearned Income
    214,341       8,271  
Net cash provided by operating activities
  $ (627,644 )   $ (270,597 )
                 
Investing Activities:
               
Purchase Property
    (31,496 )     (46,564 )
Net cash provided by investing activities
  $ (31,496 )   $ (46,564 )
                 
Financing Activities:
               
Proceeds from issuance of common stock
    -          
Loan return from supplier
    123,417       60,024  
Net cash provided by financing activities
  $ 123,417     $ 60,024  
                 
Effect of  Exchange Rate on Cash
  $ (11,242 )   $ 5,542  
Net increase (decrease) in cash and cash equivalents
  $ (546,965 )   $ (251,595 )
Cash and cash equivalents at beginning of the period
  $ 741,230     $ 992,825  
Cash and cash equivalents at end of period
  $ 194,265     $ 741,230  

 
F-7

 

FLURIDA GROUP, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE A – BUSINESS DESCRIPTION

Flurida Group, Inc. (the “Company”), incorporated under the laws of Nevada on December 19, 2006, with registered address at 502 East John Street, Carson City, NV 89706.  Flurida Group, Inc. operates its business in USA as Flurida Group USA, Inc., the Company’s wholly owned branch located in the State of Illinois and has principle office at 22 West Washington ST, Suite 1500, Chicago, IL 60602.
 
Flurida Group leased a warehouse at 24412 S Main Street, Carson, CA 90745.

Flurida Group Inc closed its subsidiary Flurida Group European S.R.L (“Flurida European”) in July 2011.

The company closed its Flurida Qingdao China office in July, 2009.

The Company’s main business includes sourcing, distribution and marketing of appliance parts in Asia, Europe, North and South America.
 
These parts are manufactured in China by Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd. (“Zhong Nan Fu Rui”) and Chuzhou Fuda Mechanical & Electronics Co., Ltd (“ChuZhou Fuda”). Zhong Nan Fu Rui was established in 2005 specializing in home appliance components and subassemblies manufacturing, and located in Qingdao City, Shandong Province, China. ChuZhou Fuda was an appliance components and sub-assemblies manufacturer established on March 18, 2008 and located in Chuzhou City, Anhui Province, China. On September 18, 2007, Flurida Group, Inc. signed a long-term distribution agreement with Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd. Zhong Nan Fu Rui is a Chinese manufacturing company owned 100% by Mr. Jianfeng Ding, the founder of the Company.

NOTE B – SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America requires management to make estimates and assumptions that affect certain amounts reported in the financial statements and disclosures. Accordingly, actual results could differ from those estimates.

Basis of accounting

The financial statements reflect the assets, revenues and expenditures of the Company on the accrued basis of accounting.
 
 
F-8

 

FLURIDA GROUP, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE B – SIGNIFICANT ACCOUNTING POLICIES (Continued)

Principles of Consolidation

The consolidated financial statements of the Company include the accounts of Flurida Group USA and Flurida Group European S.R.L. All significant intercompany balances and transactions have been eliminated in consolidation.

Cash and Cash Equivalents

The Company considers all highly-liquid investments with an original maturity of three months or less when purchased to be cash equivalents.

Concentration of credit risk

The Company maintains its cash in bank accounts which, at times, may exceed the federally insured limits.  The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on cash.

Foreign Currency Translation

The Company has determined the United States dollars to be its functional currency for Flurida Group USA and European Euro to be its functional currency in European business.  Assets and liabilities were translated to U.S. dollars at the period-end exchange rate.  Statement of operations amounts were translated to U.S. dollars using the first date of each month during the year.  Gains and losses resulting from translating foreign currency financial statements are accumulated in other comprehensive income (loss), a separate component of shareholders’ equity.

Security Deposit

The Company started having an office in California State from September 2010, which is located at 24412 S Main ST, STE 105, Carson CA 90745.  Flurida Group USA Inc made $ 6,264 security deposit for leasing the property.

 
F-9

 
 
FLURIDA GROUP, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Property, Plant, and Equipment Depreciation

Property, plant, and equipment are stated at cost.  Depreciation is being provided principally by straight line methods over the estimated useful lives of the assets. Expenditures for maintenance and repairs, which do not improve or extend the expected useful lives of the assets, are expensed to operations while major repairs are capitalized.

The equipments were recorded as fixed asset to depreciate over 7 years and the electronic data processing equipments and furniture were recorded as fixed asset to depreciate over 5 years with straight line method.

In the fiscal year 2012, the Company purchased $8,033 computers and data processing equipments, and purchased $23,464 Furniture and equipments.

As of December 31, 2012, the company has furniture, Computer and data processing equipments, and equipments at a cost of $125,588, and $37,312 of accumulated depreciation expense was recorded.

Account Receivable

As of December 31, 2012, and 2011, the company had a total of $1,558,282 and $766,318 account receivable respectively from it major customers. Detail showed as below.

   
12/31/2012
   
12/31/2011
 
                 
Chuzhou FuDa
  $ 140,892     $ -  
All other account receivable
  $ 569     $ 7,800  
Electrolux- Australia
  $ 222,579     $ 198,147  
Electrolux-Anderson-US
  $ 25,388     $ -  
Electrolux-Mexico
  $ 38,418     $ -  
Eelectrolux Major Appliance
  $ -     $ 72,828  
Electrolux - Sweden
  $ 5,442     $ -  
Electrolux Italy
  $ 235,712     $ 24,550  
Electrolux Hungary
  $ 342,987     $ 114,230  
General Electric Company
  $ -     $ 17,683  
Electrolux ST.Cloud
  $ 8,484     $ 81,596  
Stanco Metal Products Inc
  $ 22,723     $ -  
Master Precidion Global LLC(MPG)
  $ -     $ 75,455  
Sigma Refrigeration Ltd
  $ 150,420     $    
Qingdao Fubida
  $ 364,669     $ -  
ZhongNanFuRui
  $ -     $ 174,030  
TOTAL
  $ 1,558,282     $ 766,318  

 
F-10

 
 
FLURIDA GROUP, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE B – SIGNIFICANT ACCOUNTING POLICIES (Continued)

Accrued Interest Receivable

In December 31st, 2012, the Company received $14,038 interest receivable that accrued from Zhong Nan Fu Rui as of December 31, 2012; at the meantime, Zhong Nan Fu Rui returned $123,417 to the Company.  In January 1, 2013, the company entered a new loan agreement of $101,185 with its main supplier Zhong Nan Fu Rui Mechanical electronics Co., Ltd at interest rate of 5.00%, term January 1, 2013 to December 31, 2013.

Account Payable

As of December 31, 2012, and 2011, the company had a total of $2,168,172 and $1,952,256 account payable respectively. The Company incurred accounts payable including professional fees, purchases, payroll and payroll tax liability, and other service fee payables.

As of December 31, 2012, the company has account payable of $2,168,172, which included $172,624 for Zhong Nan Fu Rui, $1,766,949 for Chu Zhou Fu Da, and $157,235 for US suppliers, $26,298 for salary and payroll tax payable, and $45,066 for all other account payable.

Income Tax Payable

The Company will file corporate tax return Form 1120 to Internal Revenue Service and IL 1120 to the State of Illinois.  There is no income tax for the State of Nevada.  For the period of January 1 to December 31, 2012, the Company incurred income tax expense of $109,891, including federal tax of $83,279 and state tax of $26,612.  As of December 31, 2012, the income taxes payable of the Company was $0.
 
 
F-11

 

FLURIDA GROUP, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE B – SIGNIFICANT ACCOUNTING POLICIES (Continued)

Inventory

The inventory was valued at cost of purchase from suppliers.
 
On June, 2008, Flurida Group, Inc signed consigned inventory agreements with Electrolux Home Products De Mexico, S.A. DEC.V., and Electrolux Home Products at Anderson, South Carolina (Electrolux), under the term of the agreements, the supplier, Flurida Group, Inc, agreed to produce, to maintain the transit the customized products per Electrolux’s specification. Electrolux maintain a storage location within Electrolux’s Juarez site for consigned inventory. And Flurida Group, Inc is facilitated to use of Electrolux’s storage location at such site to the sale of products to Electrolux; Electrolux will provide labor resources for receipt, stock up, and pulls of consigned products. Flurida Group, Inc., retains title and ownership of products while in transit to Electrolux’s site and while stored in the consigned inventory location. Title and ownership will pass to Electrolux when they withdraw products from the consigned inventory location. Upon withdrawal, Electrolux will pay for it under the payment term stated in the purchasing order correspond with the withdraw products. Products residing in the consigned inventory for 90 days with no activity due to non communicated demand change will no longer qualify for consignment, and will be considered as withdrawn product after 90 days. Accordingly, title passage and invoicing shall occur on such product per the term.
 
As of December 31, 2012, there were 5,985 icemakers and 55,944 pieces motor in Electrolux Juarez warehouse as of consignment inventory. Also, there were 275,832 pieces motors in Electrolux Anderson warehouse as of consignment inventory.

The company also had 16,800 Icemakers and 30,240 motors been shipped out at FOB shipping point Qingdao, China to Electrolux Juarez warehouse. The company also had 341,280 pieces Motor and 13,440 icemakers been shipped out at FOB shipping point Qingdao, China to Electrolux Anderson warehouse. Those purchases haven’t considered as a sale or a consignment inventory at the period ended December 31, 2012. However, it’s the in transit inventories of Flurida Group, Inc.

Moreover, the Company had purchased $43,786 parts from their US supplier, and had not shipped back to their China suppliers yet.

As a result, as of December 31, 2012, the company had total inventory of $2,278,467, including of 36,225 pieces Icemakers and 703,296 pieces motors inventory at a value $2,234,681, and a value of $43,786 related parts.
 
 
F-12

 

FLURIDA GROUP, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE B – SIGNIFICANT ACCOUNTING POLICIES (Continued)

Revenues Recognition

Revenues include sales of appliance parts in Asia, Europe, and North America.
 
Revenues are recognized from product sales upon shipment, which is the point in time when risk of loss is transferred to the customer, net of estimated returns and allowances.
 
For the fiscal year ended December 31, 2012, the Company had total net revenue of $16,007,275.

For the period January 1 to December 31, 2012, the Company sold icemakers and motors to, Electrolux USA, located at Charlotte NC for sales of $10,991,669. The icemakers and motors were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd; all the icemakers and motors were shipped out at FOB shipping point Nanjing, China.

The company also sold motors, to Stanco Metal Products for $140,884; the motors were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd; all the motors were shipped out at FOB shipping point Nanjing, China.

For the fiscal year ended December 31, 2012, the Company sold icemakers, components, and tooling service to Electrolux –Australia for $964,720. The icemakers and components were manufactured and supplied by Chu Zhou Fu Da Mechanical and Electronics; all the icemakers and components were shipped out at FOB shipping point Nanjing, China.
 
The Company sold DAC Boxes, Deflector, push buttons, Magnets, Motors and other related parts to Electrolux –Italy for total $618,458. The DAC Boxes, Magnets, Motors and other related parts were manufactured and supplied by Zhong Nan Fu Rui and Chu Zhou Fuda; all the DAC Boxes magnets, and motors were shipped out at FOB shipping point Qingdao and Nanjing, China.
 
The Company also sold DAC Boxes, Magnets, Motors, and other related parts to Electrolux – Hungry for total $1,535,908. The DAC Boxes, magnets and Motors were manufactured and supplied by Zhong Nan Fu Rui and ChuZhou Fuda; all the DAC Boxes magnet, and motors were shipped out at FOB shipping point Qingdao and Nanjing, China.
 
 
F-13

 

FLURIDA GROUP, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE B – SIGNIFICANT ACCOUNTING POLICIES (Continued)

Revenues Recognition (Continued)

The Company also sold DAC Boxes and related parts to Electrolux –Sweden for $24,141. The DAC Box and parts were manufactured and supplied by Zhong Nan Fu Rui and Chu Zhou Fuda; all the DAC Boxes were shipped out at FOB shipping point Qingdao and Nanjing, China.

The company sold Motors, icemakers, and some related refrigerator appliance parts to North Carolina Electrolux Major Appliances, Inc for $241,818. The parts, icemakers, and motors were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.

The Company also sold Motors to Electrolux –ST. Cloud for $98,435. The motors were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.

The Company sold Motors and other parts to Electrolux – Do Brasil for $107,662. The motors were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.

The company sold thermostats and icemakers to an US company, Exact Replacement Parts for $63,593. The parts were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.

The company sold icemakers to an US company, Domestic LLC for $90,397. And the icemakers were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd; all the icemakers were shipped out at FOB shipping point Nanjing, China.

The company sold parts and icemakers to General Electric Company for $34,710. The parts were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.
 
 
F-14

 

FLURIDA GROUP, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE B – SIGNIFICANT ACCOUNTING POLICIES (Continued)

Revenues Recognition (Continued)

The company sold motors and components to Sigma Refrigeration Ltd for $183,120. The parts were manufactured and supplied by Zhong Nan Fu Rui, and were shipped out at FOB shipping point at Qingdao, China. The motors were manufactured and supplied by and ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.

The company sold stoves to The Paradigm Project for $197,689. The stoves were manufactured and supplied by Zhong Nan Fu Rui, and were shipped out at FOB shipping point at Qingdao, China.

For the period of January to December 31, 2012, the Company sold thermostats and other related key parts for icemakers and motors, to ChuZhouFuDa, Qingdao Fubida Electronic, and Zhong Nan Fu Rui. The parts were used for the icemakers and motors. Flurida Group purchased the parts from Wako Electronics, Inc., an US Company located at Louisville, KY 40299.  Flurida Group also sold Rocker Switch, the key parts for icemakers, to Zhong Nan Fu Rui and ChuZhouFuDa.  The parts, Rocker Switch, were used for the icemakers .The Company purchased the parts, Rocker Switch, from CW Industries, an US Company located at Southampton, PA; and also Flurida Group purchased some other related key parts from corporate America, and then sold to Zhong Nan Fu Rui, Qingdao Fubida Electronic, and ChuZhouFuDa. Flurida Group, Inc. adds averaged 5% - 10% margin based on the cost of purchase, then sold to them, so, $391,592, $443,841, and $13,716 were sold and invoiced to ChuZhouFuDa, Qingdao Fubida Electronic, and Zhong Nan Fu Rui respectively in the fiscal year ended December 31, 2012.

In the period of January 1, 2012 to December 31, 2012, the Company sold parts or provided services to America Corporation for a total of $28,912.

In summary, for the period of January 1 to December 31, 2012, the Company incurred the total gross sales of $16,171,265. And the Company had sales discount and return of $163,990, so, a total of $16,007,275 net sales were recorded. The cost of goods sold is discussed in details in Note C, Related Party Transactions.
 
 
F-15

 

FLURIDA GROUP, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE B – SIGNIFICANT ACCOUNTING POLICIES (Continued)

Operating Expense

Operating Expenses includes research and development expense, all selling, general and administrative expenses, and depreciation expenses for Flurida Group Inc.  For the fiscal year ended December 31, 2012 and 2011, the Company had total operating expenses of $1,205,671 and $1,040,836 respectively. Detail was showed on Exhibit A.

Payroll Expense

Started from January 2011, Flurida Group had salaries for officers Jianfeng Ding, Yaru Huang, and Ying Zhong for $350,000, $80,000, $80,000. The Social Security tax and Medicare tax were paid by both employer and employees in USA; employees also withheld portion of Federal and State tax calculate by each individual’s status. All of the tax was submitted to Internal Revenue Service and local government at a semiweekly basis.

The total payroll expenses for the year ended December 31, 2012 and 2011 were listed as follows:

   
Year Ended
   
Year Ended
 
   
December 31,
   
December 31,
 
   
2012
   
2011
 
Payroll Expense - ER
           
Federal Unemployment Tax
    546.00       584.89  
State Unemployment Tax
    1,045.08       3,184.66  
US Medicare Tax - ER
    9,812.09       8,496.89  
US Social Security Tax -ER
    27,081.33       20,953.17  
Payroll Expense - ER - Other
    350.87       232.46  
Total Payroll Expense - ER
    38,835.37       33,452.07  
Payroll Expenses - EE
               
Federal Tax Withholding
    123,083.84       106,358.47  
State Tax Withholding
    42,303.56       32,316.65  
US Medicare Tax -EE
    9,812.07       8,496.89  
US Net Salaries payment - EE
    481,160.36       424,108.86  
US Social Security Tax - EE
    18,345.43       14,697.27  
Total Payroll Expenses - EE
    674,705.26       585,978.14  
                 
Total Payroll Expenses
    713,540.63       619,430.21  

 
F-16

 

FLURIDA GROUP, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE B – SIGNIFICANT ACCOUNTING POLICIES (Continued)

Professional Fee

Professional fees are consist of accounting and auditing fee, legal fee, commission and consulting expenses, SEC filling fee, and other professional expenses. The total professional fees were $125,781 and $95,009 for the fiscal year ended December 31, 2012 and 2011 respectively.

Basics and Diluted Net Loss Per Common Share
 
Basic earnings per share is computed by dividing income available to common shareholders (the numerator) by the weighted-average number of common shares outstanding (the denominator) for the period. Diluted earnings per share assume that any dilutive convertible securities outstanding were converted, with related preferred stock dividend requirements and outstanding common shares adjusted accordingly. It also assumes that outstanding common shares were increased by shares issuable upon exercise of those stock options for which market price exceeds the exercise price, less shares which could have been purchased by us with the related proceeds. In periods of losses, diluted loss per share is computed on the same basis as basic loss per share as the inclusion of any other potential shares outstanding would be anti-dilutive.
 
The Company only issued one type of shares, i.e., common shares only. There are no other types securities were issued. Accordingly, the diluted and basics net loss per common share are the same.

Income Tax

Income taxes are provided for tax effects of transactions reported in the financial statements and consist of taxes currently due plus deferred taxes. Deferred taxes are recognized for differences between the bases of assets and liabilities for financial statement and income tax purposes. The differences in asset and liability bases relate primarily to organization and start-up costs (use of different methods and periods to calculate deduction). Deferred taxes are also recognized for operating losses and tax credits that are available to offset future income taxes. The deferred tax assets and/or liabilities represent the future tax return consequences of those differences, which will either be taxable or deductible when the assets and liabilities are recovered or settled. The components of the deferred tax asset and liability are classified as current and concurrent based on their characteristics. Valuation allowances are provided for deferred tax assets based on management’s projection of the sufficiency of future taxable income to realize the assets.
 
 
F-17

 
 
FLURIDA GROUP, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE B – SIGNIFICANT ACCOUNTING POLICIES (Continued)

Recent Accounting Pronouncements

Business Combinations —The new guidance on business combinations retains the underlying concepts of the previously issued standard in that the acquirer of a business is required to account for the business combination at fair value. As with previous guidance, the assets and liabilities of the acquired business are recorded at their fair values at the date of acquisition. The excess of the purchase price over the estimated fair values are recorded as goodwill. The new pronouncement results in some changes to the method of applying the acquisition method of accounting for business combinations in a number of significant aspects. Under the new guidance, all acquisition costs are expensed as incurred and in-process research and development costs are recorded at fair value as an indefinite-lived intangible asset. Prior to the adoption, in-process research and development costs were immediately expensed and acquisition costs were capitalized. Further, the new guidance generally requires restructuring charges associated with a business combination to be expensed subsequent to the acquisition date.

Fair Value Measurements and Disclosures — The pronouncements define fair value, establish guidelines for measuring fair value, and expand disclosures regarding fair value measurements.

Derivative Instruments and Hedging Activities — The pronouncement requires additional disclosures about the objectives of derivative instruments and hedging activities, the method of accounting for such instruments, and a tabular disclosure of the effects of such instruments and related hedged items on Financial Statements. The pronouncement does not change the accounting treatment for derivative instruments.

Variable Interest Entities and Transfers of Financial Assets and Extinguishments of Liabilities — The pronouncement on transfers of financial assets and extinguishments of liabilities removes the concept of a qualifying special-purpose entity and removes the exception from applying variable interest entity accounting to qualifying special-purpose entities. The new guidance on variable interest entities requires an entity to perform an ongoing analysis to determine whether the entity’s variable interest or interests give it a controlling financial interest in a variable interest entity. The pronouncements are effective for fiscal years beginning after November 15, 2009.
 
Management does not anticipate that the adoption of these standards will have a material impact on the financial statements.
 
 
F-18

 
 
 FLURIDA GROUP, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE B – SIGNIFICANT ACCOUNTING POLICIES (Continued)

Comprehensive Income

The company’s comprehensive income is comprised of net income, unrealized gains and losses on marketable securities classified foreign currency translation adjustments, and unrealized gains and losses on derivative financial instruments related to foreign currency hedging.

NOTE C – RELATED PARTY TRANSACTIONS

Common Shares Issued to Executive and Non-Executive Officers and Directors

As of December 31, 2012, total 29,277,760 shares were issued to officers and directors.  Please see the table below for details:

Name
 
Total Shares
   
Total Amount
   
Percentage
 
                   
Fenglan  Li
    165,000       15,750       0.42 %
Fuling Li
    115,000       10,750       0.29 %
Ying Zhong
    2,000,000       200,000       5.10 %
Jianfeng Ding & Yaru Huang     26,997,760       323,998       68.89 %
    Total
    29,277,760     $ 550,498       74.71 %
 
    ●    Based on total outstanding issued shares as of December 31, 2012: 39,290,827

Cost of Goods Sold

The Company’s purchase is primarily from supplier, Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd and Chuzhou Fuda Mechanical & Electronics Co., Ltd, owned 100% by the founder of the Company, Jianfeng Ding.  Due to Jianfeng Ding, and Yaru Huang, husband and wife, combined hold 68.89% issued common shares for Flurida Group, Inc., the two entities, Flurida Group, Inc., and Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd and Chuzhou Fuda Mechanical & Electronics Co., Ltd are under common control according to EITF 02-5.
 
 
F-19

 
 
FLURIDA GROUP, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE C – RELATED PARTY TRANSACTIONS (Continued)

Cost of Goods Sold (Continued)
 
The products the Company will sell are manufactured in China by Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd. (“Zhong Nan Fu Rui”).  It was established in 2005 specializing in home appliance components and subassemblies manufacturing, and located in Qingdao City, Shandong Province, China.  On September 18, 2007, amended June 25, 2008 and further amended on August 4, 2008, Flurida Group, Inc. signed a five year distribution agreement with Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd.  Zhong Nan Fu Rui is a Chinese manufacturing company owned 100% by Mr. Jianfeng Ding, our president.  Under the terms of the agreement Zhong Nan Fu Rui authorizes Flurida to be its exclusive sales agent for the ice making product lines, including icemaker and ice water dispensing systems all over the world. The ice making product lines shall include the products that Zhong Nan Fu Rui developed before the agreement signed and the products that will be developed solely by Zhong Nan Fu Rui during the term of the agreement. Zhong Nan Fu Rui is the exclusive supplier of the products we sell.  Although the distribution agreement requires that the purchase price we will pay for these products will be comparable to what the Flurida would have paid a non-related party in market price, Mr. Ding may face a conflict in calculating the price the products are sold to Flurida and the determining amount of products the Flurida purchase.  However, because Mr. Ding has a fiduciary duty to Flurida and the shareholders, he has indicated that he will assure strict adherence to this provision of the agreement and will not require Flurida to purchase a quantity of products in excess of that which Flurida can reasonably afford or reasonably expect to sell in within two to three months of our purchase of the products.

The management of Flurida Group, Inc. believes that the purchase price for the parts from Zhong Nan Fu Rui will be market price.  Flurida Group, Inc. and Zhong Nan Fu Rui are two totally separated entities, i.e., Flurida Group, Inc. is a USA corporation and will fully comply with USA regulations and USA general accepted accounting principles; Zhong Nan Fu Rui is a Chinese company and it will comply with Chinese legal systems.
 
 
F-20

 

FLURIDA GROUP, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE C – RELATED PARTY TRANSACTIONS (Continued)

Cost of Goods Sold (Continued)

Flurida Group, Inc. and Zhong Nan Fu Rui will operate independently.  Zhong Nan Fu Rui, as a Chinese local manufacturer, will record their manufacturing costs and inventories based on the Chinese accounting regulations rulings.  But, when Flurida Group, Inc. purchases the parts from Zhong Nan Fu Rui, Flurida Group will record the actual costs paid to Zhong Nan Fu Rui as the costs for inventory of Flurida Group, Inc.  There is no any relationship for Zhong Nan Fu Rui’s manufacturing historic costs with Flurida Group’s inventory value.  Specifically, Flurida’s inventory value is equal to the purchase price or actual cost of the parts purchased from Zhong Nan Fu Rui, and the purchase price of the parts will be fair market price.  Flurida Group, Inc. will adopt the first-in and first-out inventory system according to generally accepted accounting principles in USA.
 
The management of Zhong Nan Fu Rui disclosed to Flurida Group, Inc. that, Zhong Nan Fu Rui adopted the cost plus pricing policies with market adjustment, negotiable with customers. Zhong Nan Fu Rui adopted the cost plus system for all the products for all customers including the product, icemakers exclusively distributed by Flurida Group, Inc. Specifically, the selling price is determined by total actual manufacturing cost of direct manufacturing materials (parts), direct manufacturing labor, and allocated manufacturing overhead cost, plus 5-10% of total manufacturing cost. Zhong Nan Fu Ruis minimum gross profit margin is 5%.
 
Flurida Group also purchased the products from suppliers, Qingdao Fubida Electronics Co., Ltd, Shanghai Fulu International Trading Co., Ltd, and Chuzhou Fuda Mechanical and Electronics Co., Ltd on purchase orders basis.

Qingdao Fubida Electronics Co., Ltd, owned 100% indirectly by Jianfeng Ding and Yaru Huang, husband and wife. Qingdao Fubida Electronics Co., Ltd is a manufacturing company, and it was established in 2003 specializing in home appliance control components and subassemblies manufacturing, and located in Qingdao City, Shandong Province, China. The plant space is around 70,000 sq ft. 14 units injection molding machine up to 600 metric tons.

Shanghai Fulu International Trading Co., Ltd. a trading company established in 2007, located at Shanghai, China, 100% owned indirectly by Jianfeng Ding and Yaru Huang.
 
 
F-21

 

FLURIDA GROUP, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE C – RELATED PARTY TRANSACTIONS (Continued)

Cost of Goods Sold ( Continued)

Chuzhou Fuda Mechanical & Electronics Co., Ltd. owned 100% indirectly by Jianfeng Ding and Yaru Huang, husband and wife is an appliance components and sub-assemblies manufacturer established on March 18, 2008. Chuzhou Fuda is located in Chuzhou City, Anhui Province, China. The plant space is around 100,000sq. ft. with 18 molding machine up to 800 metric ton and 6 assemblies lines for appliance components and assemblies.

At the year ended December 31, 2011, the Company had ending inventory $1,803,675 that was purchased from Zhong Nan Fu Rui and ChuZhou FuDa.

From the period January 1 to December 31, 2012, Flurida Group, Inc. purchased Motors, parts and stoves from Zhong Nan Fu Rui at total cost of $1,515,914 for FOB shipping point at Qingdao, China.

Flurida Group, Inc. also purchased Motors, Deflectors, Icemakers, Magnets, Dac boxes, and other related parts from Qingdao Fubida Electronics Co., Ltd. at total cost of $113,103 for FOB shipping point at Qingdao, China.

The Company purchased Icemakers and motors from ChuZhou FuDa at total cost of $12,613,639 for FOB shipping point at Nanjing, China.

In addition, Flurida Group, Inc. purchased Magnets, Icemakers, Timers and related parts from Shanghai Fulu International Trading Co., Ltd., at total cost of $16,210 for FOB shipping point at Shanghai, China.

To manufacture the related refrigerator appliance parts, Zhong Nan Fu Rui, Chuzhou Fuda Mechanical & Electronics Co., Ltd, and Qingdao Fubida Electronics Co., needs key parts made in USA, which were purchased through Flurida Group, Inc. in USA.  The costs of purchasing the parts were $852,521 in fiscal year 2012.

For the fiscal year ended December 31, 2012, the Company had total purchase of $15,111,387.

At the fiscal year ended December 31, 2012, the Company had total ending inventory $2,278,467.
 
 
F-22

 

FLURIDA GROUP, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE C – RELATED PARTY TRANSACTIONS (Continued)

Cost of Goods Sold (Continued)

For the period of January 1 to December 31, 2012, the company had freight cost of $22,868 and other cost of $4,439; and had a total purchase return and discount of $115,959.

Therefore, in the fiscal year ended December 31, 2012, the Company incurred a total cost of good sold of $14,547,943.

Loan to Supplier

At January 1st, 2013, Flurida Group, Inc entered into a new loan agreement of $101,185 with the company’s primary supplier, Zhong Nan Fu Rui. The outstanding balance bears interest at 5.00%, pursuant to a written agreement, for the term from January 1st 2013 to December 31st 2013.

NOTE D – SHAREHOLDERS’ EQUITY

During the year ended December 31, 2008, Flurida Group, Inc has issued total 11,699,067 new shares on April 15, 2008, including 11,649,067 shares issued to loan holders who converted all the loans to common shares. At the year ended December 31, 2008, Flurida Group, Inc. incurred net loss of $(194,079).

Therefore, the total stockholders’ equity balance at December 31, 2008 was $1,075,377.

On April 15, 2008, 50,000 shares issued to Williams Law Group at $0.10, for the legal service value of $5,000.  On April 1, 2008, seven non-affiliated loan holders asked for repayment of their loans in the aggregate amount of $ 25,066 plus the total interest cost of $624.72, which was paid on the same date, April 1, 2008; meantime, seven additional lenders loaned an aggregate amount of $9,926.

On April 15, 2008, total loan amount of $1,164,906 was converted to common shares at price of $0.10 per share, for the total shares of 11,649,067 shares, which were issued to the loans holders.

There were no new shares issued during the period ending December 31, 2009, 2010, and 2011.
 
 
F-23

 

FLURIDA GROUP, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 
NOTE D – SHAREHOLDERS’ EQUITY (Continued)

On November 1, 2012, 300,000 shares were issued to Williams Law Group at $0.10, for the legal service value of $30,000.
 
Therefore, as of December 31, 2012 total shares issued and outstanding are 39,290,827.

NOTE E – GOING CONCERN

The Company’s customer concentration may raise doubt about its ability to continue as a going concern. The financial statements do not include adjustments that might result from the outcome of this uncertainty and if the Company is unable to generate significant revenue or secure financing, then the Company may be required to cease or curtail its operations.  In year 2012, the Company generated sales revenue of $16,007,275. The Company’s significant customers are Electrolux and its subsidiaries located in various countries.  Electrolux and its subsidiaries are operated independently in various countries, the management assess that it is unlikely if Electrolux and its subsidiary discontinue the purchase in near future due to the Company secured a purchase order in next three years with Electrolux and its subsidiaries. Because of the concentration of the customer and supplier base and Company’s heavily reliance on the Electrolux and its subsidiaries, Company may face the difficulty as going concern. However, the going concern may be mitigated due to the close relationship between the Company and it’s suppliers, Zhong Nan Fu Rui and Chuzhou Fuda Mechanical & Electronics Co., Ltd , which are 100% owned by the founder, Jianfeng Ding. Zhong Nan Fu Rui and Chuzhou Fuda Mechanical & Electronics Co., Ltd.’s current customers can be served by the Company for the same quality of products and services.  Besides, as of December 31, 2012, the cash and cash equivalent balance was $194,265, the management believes that the revenues will be generated and its cash flows will be maintained to cover its operational costs and the risk of going concern in long term is significantly low.

 
F-24

 

Exhibit A

   
Year Ended
   
Year Ended
 
   
December 31,
   
December 31,
 
   
2012
   
2011
 
                 
Administration Expense
    1,681       2,071  
Bad Debt Expense
    -       5,895  
Bank Service Charges
    58,182       4,449  
Business Registration
    904       1,513  
Certification Fee
    66,654       73,832  
Computer and Internet Expenses
    1,317       1,100  
Credit card Finance Charge
    218       60  
Depreciation and amortization expenses
    20,957       14,965  
Fuel charge
    3,049       883  
Gift and Promotion
    9,504       5,048  
Insurance Expense
    945       945  
Meals and Entertainment
    19,822       14,293  
Office Supplies
    8,262       12,920  
Parking fee
    864       376  
Payroll Expense - ER
    38,835       33,452  
Payroll Expenses - EE
    674,705       585,978  
Penalty & Fine Expenses
    -       218  
Postage & Shipping
    8,154       6,035  
Professional Fees
    125,781       95,009  
Rent Expense
    52,687       52,075  
Repairs and Maintenance
    3,118       6,104  
Research and development Expense
    17,311       15,191  
Service Cost
    340       4,406  
Telephone Expense
    9,891       9,284  
Travel Expense
               
Air Agent Fee
    2,008       789  
Airfare
    42,425       58,332  
Car Rental
    5,687       3,872  
Hotel Expense
    29,377       27,954  
Local Transportation
    590       1,511  
Travel Expense - Other
    -       1,134  
Total Travel Expense
    80,087       93,592  
Utilities
    2,401       1,142  
Total Expense
  $ 1,205,671     $ 1,040,836  
 
 
F-25

 
 
Item 9. Changes In and Disagreements With Accountants on Accounting and Financial Disclosures

None
 
Item 9A. Controls and Procedures
 
Evaluation of Disclosure Controls and Procedures

The Company’s Chief Executive Officer and Chief Financial Officer have evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of December 31, 2012. Based upon such evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that, as of December 31, 2012, the Company’s disclosure controls and procedures were not effective. This conclusion by the Company’s Chief Executive Officer and Chief Financial Officer does not relate to reporting periods after December 31, 2012.

Management’s Report on Internal Control Over Financial Reporting

Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting as of December 31, 2012 based on the framework stated by the Committee of Sponsoring Organizations of the Treadway Commission. Furthermore, due to our financial situation, we will be implementing further internal controls as we become operative so as to fully comply with the standards set by the Committee of Sponsoring Organizations of the Treadway Commission.

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act. Our internal control system was designed 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. Because of inherent limitations, a system of internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate due to change in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Based on its evaluation as of December 31, 2012, our management concluded that our internal controls over financial reporting were not effective as of December 31, 2012. A material weakness is a deficiency, or a combination of control deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis.
 
 
19

 
 
The material weakness relates to the following:
 
1.   Accounting and Finance Personnel Weaknesses – Our current accounting staff is relatively small and we do not have the required infrastructure of meeting the higher demands of being a U.S. public company. This material weakness also relates to a lack of personnel with expertise in preparing financial statements in accordance with U.S. GAAP, in addition to the small size of the staff.

2.   Lack of Internal Audit Function – We lack sufficient resources to perform the internal audit function.
 
In order to mitigate these material weaknesses to the fullest extent possible, all work of the CFO is reviewed by the CEO. All unexpected results are investigated. At any time, if it appears that any control can be implemented to continue to mitigate such weaknesses, it will be immediately implemented. The Company continues to study the implementation of additional internal controls over accounting and financial reporting. 

This annual report does not include an attestation report of the Company s registered public accounting firm regarding internal control over financial reporting. Management s report was not subject to attestation by our registered public accounting firm pursuant to temporary rules of the SEC that permit us to provide only management’s report in this Annual Report on Form 10-K.
 
Changes in Internal Control Over Financial Reporting

No change in the Company’s internal control over financial reporting occurred during the quarter ended December 31, 2012, that materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.
 
Item 9B. Other Information
 
None.
 
 
20

 
 
PART III
 
Item 10. Directors, Executive Officers, Promoters, Control Persons and Corporate Governance; Compliance with Section 16(a) of the Exchange Act
 
Directors and Officers
 
The board of directors elects our executive officers annually. A majority vote of the directors who are in office is required to fill vacancies. Each director shall be elected for the term of one year, and until his successor is elected and qualified, or until his earlier resignation or removal. Our directors and executive officers are as follows:

Name
 
Age
 
Position
Jianfeng Ding
 
56
 
Chairman of the Board, President, and CEO
Yaru Huang
 
45
 
Chief Financial Officer and Chief Accounting Officer
Ying Zhong
 
41
 
Chief Representative, Director

Ding, Jianfeng. Jianfeng Ding joined us in December 19, 2006 Chairman of Board of Directors, Chief Executive Officer. From September 1998 to December 2006, he was President of Flurida Industries (Hong Kong) Co., Ltd., a Hong Kong corporation doing business of distribution of appliance parts. In 1981, he graduated from Hang Zhou Electronic Technical University majoring in mechanical engineering. From 1985-1989, he studied at Xi’an Electronic Science University on Application of Computer Science. As a member of the board, Mr. Ding contributes his knowledge of the company and a deep understanding of all aspects of our business, products and markets, as well substantial experience developing corporate strategy, assessing emerging industry trends, and business operations.

Huang, Yaru. Yaru Huang joined us in December 19, 2006 as Chief Financial Officer and Chief Accounting Officer. From September 1998 to December 2006, she was vice-president of Flurida Industries (Hong Kong) Co., Ltd., a Hong Kong corporation doing business of distribution of appliance parts. In June 2002, she received a Master of Business Administration Degree at Keller Graduate School of Management, from DeVry University. In September 1990, she received a degree of Bachelor of Science from Lanzhou Enginerring Institute of Survey and Design, Railway Ministry in Lanzhou. As a member of the board, Ms. Huang contributes his financial expertise based on his significant industry and financial experience.
 
Ying Zhong joined us as director and Vice President in Oct/2007. From Jan/2004 to Sep/2007, she was Vice President, New Business Development of Flurida Industries (Hong Kong) Ltd., which manufactures and distributes household appliance components. From Feb/2003 to Dec/2003, she was Manager, Chicago Office of Flurida Industries (Hong Kong) Ltd., which manufactures and distributes household appliance components. From Sep/1995 to Aug/2001, she was Operational Assistant Manager of Young’s Engineering Shanghai Office, which provides Mechanical and Electrical Engineering service to construction industry. In Sep/2001, she received a Master Degree of Business Administration from University of Illinois at Chicago. In July/1993, she received a Bachelor Degree of Law from Hua Qiao University. As a member of the board, Ms. Zhong contributes significant industry-specific experience and expertise on our products and services
 
Family Relationships

Jianfeng Ding and Yaru Huang are husband and wife.
 
 
21

 

Legal Proceedings

No officer, director, or persons nominated for such positions, promoter or significant employee has been involved in the last ten years in any of the following:

 
o
Any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time,

 
o
Any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses),

 
o
Being subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities,

 
o
Being found by a court of competent jurisdiction (in a civil action), the Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated.

 
o
Having any government agency, administrative agency, or administrative court impose an administrative finding, order, decree, or sanction against them as a result of their involvement in any type of business, securities, or banking activity.

 
o
Being the subject of a pending administrative proceeding related to their involvement in any type of business, securities, or banking activity.

 
o
Having any administrative proceeding been threatened against you related to their involvement in any type of business, securities, or banking activity.

Code of Ethics

We do not currently have a Code of Ethics applicable to our principal executive, financial or accounting officer.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires the Company's directors and executive officers, and persons who beneficially own more than 10% of a registered class of the Company's equity securities, to file reports of beneficial ownership and changes in beneficial ownership of the Company's securities with the SEC on Forms 3 (Initial Statement of Beneficial Ownership), 4 (Statement of Changes of Beneficial Ownership of Securities) and 5 (Annual Statement of Beneficial Ownership of Securities). Directors, executive officers and beneficial owners of more than 10% of the Company's Common Stock are required by SEC regulations to furnish the Company with copies of all Section 16(a) forms that they file. Our directors and executive officers have filed such reports as required.
 
 
22

 
 
Item 11. Executive Compensation
 
Summary Compensation Table
 
The table below summarizes all compensation awarded to, earned by, or paid to our Principal Executive Officer, our two most highly compensated executive officers other than our PEO who occupied such position at the end of our latest fiscal year and up to two additional executive officers who would have been included in the table below except for the fact that they were not executive officers at the end of our latest fiscal year, by us, or by any third party where the purpose of a transaction was to furnish compensation, for all services rendered in all capacities to us or our subsidiary for the latest two fiscal years ended December 31, 2012, and December 31, 2011.
 
Name
   
Title
   
Year
   
Salary
   
Bonus
   
Stock
awards
   
Option
awards
   
Non equity
incentive plan
compensation
   
Non
qualified
deferred
compensation
and all
other
compensation
   
Total
compensation
 
                                                                       
Jianfeng Ding
   
Chairman CEO
   
2012
      350,000                                               350,000  
           
2011
      350,000                                               350,000  
                                                                       
Yaru Huang
   
CFO
   
2012
      80,000                                               80,000  
           
2011
      80,000                                               80,000  
                                                                       
Ying Zhong
   
Director
   
2012
      80,000                                               80,000  
           
2011
      80,000                                               80,000  

Compensation Agreements

We have the following oral compensation agreements:

Mr. Jianfeng Ding, Chairman, CEO, and President:

Main responsibilities of the position are as follows:

 
1.
Board Administration and Support — Supports operations and administration of Board by advising and informing Board members, interfacing between Board and staff, and supporting Board's evaluation of chief executive.

 
2.
Program, Product and Service Delivery — Oversees design, marketing, promotion, delivery and quality of programs, products and services

 
3.
Financial, Tax, Risk and Facilities Management — Recommends investment activities, issue quarterly and annual reports for Board approval and prudently manages organization's resources within those guidelines according to current laws and regulations

 
4.
Human Resource Management — Effectively manages the human resources of the organization according to authorized personnel policies and procedures that fully conform to current laws and regulations

 
5.
Community and Public Relations — Assures the organization and its mission, programs, products and services are consistently presented in strong, positive image to relevant shareholders.

 
6.
Raising capitals – Oversees capital raising planning and implementation, including identifying resource requirements, establishing strategies to approach investors, submitting proposals and administrating capital raise records and documentation.
 
 
23

 
 
Employment period is three years from December 2006 to December 2009. Annual salary will be $150,000 starting to pay at January, 2009. The salaries accrued from December 2006 and December 2008 will be waived by Jianfeng Ding. Accordingly, there is no salary payment for Jianfeng Ding in 2006, 2007, and 2008, respectively. The employment was renewed in January 2010 for another three years with annual salary of $200,000 in 2010 and $350,000 in 2011 and 2012.
 
Ms. Yaru Huang, CFO

Main responsibilities of the position are as follows:

1. Oversee the corporate finance in accordance with the General Accepted Accounting Principles of the United States, General Principles of Corporate Finance, and Financial Management System developed by the company.

2. Implement the directives of the CEO and the Board of Directors in the following financial areas: allocation of all the corporate capital and management of the company’s capital or other investments.

3. Develop corporate financial plan, control auditing analysis, raise capitals legally, make use of the corporate assets effectively, and make every efforts to increase the corporate economic benefits.

4. Supervise and manage the finances of the subsidiaries of the company. Employment period is three years from December 2006 to December 2009. Annual salary will be $60,000 starting to pay at January, 2009.

The salaries accrued from December 2006 to December 2008 will be waived by Yaru Huang. Accordingly, there is no salary payment for Yaru Huang in 2006, 2007, and 2008, respectively.

Employment period was three years from December 2006 to December 2009. Annual salary will be $60,000 starting to pay at January, 2009. The employment was renewed in January 2010 for another three years with annual salary of $70,000 in 2010 and $80,000 in 2011 and 2012.

Ying Zhong, Vice President, Business Development

Main responsibility of the position are as follows:
 
1.
Assist CEO to develop new products and new businesses in different markets
2.
Handle detail operation of the existing businesses with clients in US, Europe, Australia, South America, which include order process, customer service, etc.
3.
Manage and assist agents in Europe, Mexico and China to develop and maintain the businesses in these markets.

Employment period was three years from October 2007 to October 2009. Annual salary will be $60,000 starting to pay at April 2009. The salaries accrued from October 2007 to December 2008 will be waived by Ying Zhong. Accordingly, there is no salary payment for Ying Zhong in 2007, and 2008, respectively. The employment was renewed in January 2010 for another three years with annual salary of $70,000 in 2010 and $80,000 in 2011 and 2012.
 
Compensation Committee Interlocks and Insider Participation

We have no compensation committee (or other board committee performing equivalent functions). The board of directors will make decisions for the compensation of executive officers. Currently, there are three directors: Jianfeng Ding, Yaru Huang, Ying Zhong are also executive officers and shareholders with more than 5% of issued common stocks. During the last completed fiscal year, there are no other individuals participated in deliberations of the registrant’s board of directors concerning executive officer compensation.
 
 
24

 
 
Outstanding Equity Awards At Fiscal Year-End
 
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END December 31, 2012
 
Name 
 
Number of
Securities
Underlying
Unexercised
Options
(#)
Exercisable
   
Number of
Securities
Underlying
Unexercised
Options
(#)
Unexercisable
   
Equity
Incentive
Plan
Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options (#)
   
Option
Exercise
Price
($)
   
Option
Expiration
Date
   
Number of
Shares or
Units of
Stock That
Have Not
Vested
(#)
   
Market
Value of
Shares or
Units of
Stock That
Have Not
Vested
($)
   
Equity
Incentive
Plan
Awards:
Number
Of
Unearned
Shares,
Units or
Other
Rights That
Have Not
Vested 
(#)
   
Equity
Incentive
Plan
Awards:
Market or
Payout
Value of
Unearned
Shares,
Units or
Other
Rights
That Have
Not
Vested
($)
 
                                                                         
Jianfeng Ding
   
0
     
0
     
0
     
0
     
0
     
0
     
0
     
0
     
0
 
                                                                         
Yaru Huang
   
0
     
0
     
0
     
0
     
0
     
0
     
0
     
0
     
0
 
                                                                         
Ying Zhong
   
0
     
0
     
0
     
0
     
0
     
0
     
0
     
0
     
0
 
 
No option awards, unexercised options, unvested stock awards or equity incentive plan awards were granted to our named executive officers during fiscal year ended at December 31, 2012.
 
Director Compensation
 
The following table summarizes the compensation paid to Flurida Group’ directors for the fiscal year ended December 31, 2012:
 
Name
 
Fees
Earned
or
Paid in
Cash
   
Stock
Awards
($)
   
Option
Awards
($)
   
Non-Equity
Incentive Plan
Compensation
($)
   
All Other
Compensation
($)
   
Total
($)
 
                                                 
Jianfeng Ding
   
0
     
0
     
0
     
0
     
0
     
0
 
Yaru Huang
   
0
     
0
     
0
     
0
     
0
     
0
 
Ying Zhong
   
0
     
0
     
0
     
0
     
0
     
0
 
 
No director was paid in any form of compensation as of December 31, 2012.
 
 
25

 

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
 
The following tables set forth the ownership, as of the date of this prospectus, of our common stock by each person known by us to be the beneficial owner of more than 5% of our outstanding common stock, our directors, and our executive officers and directors as a group. To the best of our knowledge, the persons named have sole voting and investment power with respect to such shares, except as otherwise noted. There are not any pending or anticipated arrangements that may cause a change in control.

The information presented below regarding beneficial ownership of our voting securities has been presented in accordance with the rules of the Securities and Exchange Commission and is not necessarily indicative of ownership for any other purpose. Under these rules, a person is deemed to be a "beneficial owner" of a security if that person has or shares the power to vote or direct the voting of the security or the power to dispose or direct the disposition of the security. A person is deemed to own beneficially any security as to which such person has the right to acquire sole or shared voting or investment power within 60 days through the conversion or exercise of any convertible security, warrant, option or other right. More than one person may be deemed to be a beneficial owner of the same securities. The percentage of beneficial ownership by any person as of a particular date is calculated by dividing the number of shares beneficially owned by such person, which includes the number of shares as to which such person has the right to acquire voting or investment power within 60 days, by the sum of the number of shares outstanding as of such date plus the number of shares as to which such person has the right to acquire voting or investment power within 60 days. Consequently, the denominator used for calculating such percentage may be different for each beneficial owner. Except as otherwise indicated below and under applicable community property laws, we believe that the beneficial owners of our common stock listed below have sole voting and investment power with respect to the shares shown. The business address of the shareholders is 22 W. Washington St., Suite 1500
Chicago, IL 60602.
 
Name
 
Number of 
Shares of 
Common stock
   
Percentage
 
             
Jianfeng Ding [1]
   
13,498,880
     
34.36
%
Yaru Huang [1]
   
13,498,880
     
34.36
%
Ying Zhong
   
2,000,000
     
5.09
%
All executive officers and directors as a group [3 persons]
   
29,277,760
     
74.52
%
 
[1] Owned 13,498,880 shares in the name of Jianfeng Ding and 13,498,880 shares in the name of Yaru Huang, husband and wife.

This table is based upon information derived from our stock records. Unless otherwise indicated in the footnotes to this table and subject to community property laws where applicable, each of the shareholders named in this table has sole or shared voting and investment power with respect to the shares indicated as beneficially owned. Except as set forth above, applicable percentages are based upon 39,290,827 shares of common stock outstanding as of December 31, 2012.
 
Securities authorized for issuance under equity compensation plans

5,000,000 shares of Common Stock.
 
 
26

 
 
Item 13. Certain Relationships and Related Transactions, and Director Independence.

Common Shares Issued to Executive and Non-Executive Officers and Directors

As of December 31, 2012, total 29,277,760 shares were issued to officers and directors. Please see the table below for details:

Name
 
Total
Shares
   
Total
Amount
   
Percentage
 
Fenglan Li
    165,000       15,750       0.42 %
Fuling Li
    115,000       10,750       0.29 %
Ying Zhong
    2,000,000       200,000       5.09 %
Jianfeng Ding & Yaru Huang
                       
      26,997,760       323,998       68.72 %
Total
    29,277,760     $ 550,498       74.52 %
 
·  Based on total outstanding issued shares as of December 31, 2012: 39,290,827
 
Cost of Goods Sold
 
The Company’s purchase is primarily from supplier, Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd and Chuzhou Fuda Mechanical & Electronics Co., Ltd, owned 100% by the founder of the Company, Jianfeng Ding. Due to Jianfeng Ding, and Yaru Huang, husband and wife, combined hold 68.89% issued common shares for Flurida Group, Inc., the two entities, Flurida Group, Inc., and Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd and Chuzhou Fuda Mechanical & Electronics Co., Ltd are under common control according to EITF 02-5.
 
The products the Company will sell are manufactured in China by Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd. (“Zhong Nan Fu Rui”). It was established in 2005 specializing in home appliance components and subassemblies manufacturing, and located in Qingdao City, Shandong Province, China. On September 18, 2007, amended June 25, 2008 and further amended on August 4, 2008, Flurida Group, Inc. signed a five year distribution agreement with Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd. Zhong Nan Fu Rui is a Chinese manufacturing company owned 100% by Mr. Jianfeng Ding, our president. Under the terms of the agreement Zhong Nan Fu Rui authorizes Flurida to be its exclusive sales agent for the ice making product lines, including icemaker and ice water dispensing systems all over the world. The ice making product lines shall include the products that Zhong Nan Fu Rui developed before the agreement signed and the products that will be developed solely by Zhong Nan Fu Rui during the term of the agreement. Zhong Nan Fu Rui is the exclusive supplier of the products we sell. Although the distribution agreement requires that the purchase price we will pay for these products will be comparable to what the Flurida would have paid a non-related party in market price, Mr. Ding may face a conflict in calculating the price the products are sold to Flurida and the determining amount of products the Flurida purchase. However, because Mr. Ding has a fiduciary duty to Flurida and the shareholders, he has indicated that he will assure strict adherence to this provision of the agreement and will not require Flurida to purchase a quantity of products in excess of that which Flurida can reasonably afford or reasonably expect to sell in within two to three months of our purchase of the products.
 
The management of Flurida Group, Inc. believes that the purchase price for the parts from Zhong Nan Fu Rui will be market price. Flurida Group, Inc. and Zhong Nan Fu Rui are two totally separated entities, i.e., Flurida Group, Inc. is a USA corporation and will fully comply with USA regulations and USA general accepted accounting principles; Zhong Nan Fu Rui is a Chinese company and it will comply with Chinese legal systems.
 
Flurida Group, Inc. and Zhong Nan Fu Rui will operate independently. Zhong Nan Fu Rui, as a Chinese local manufacturer, will record their manufacturing costs and inventories based on the Chinese accounting regulations rulings. But, when Flurida Group, Inc. purchases the parts from Zhong Nan Fu Rui, Flurida Group will record the actual costs paid to Zhong Nan Fu Rui as the costs for inventory of Flurida Group, Inc. There is no any relationship for Zhong Nan Fu Rui’s manufacturing historic costs with Flurida Group’s inventory value. Specifically, Flurida’s inventory value is equal to the purchase price or actual cost of the parts purchased from Zhong Nan Fu Rui, and the purchase price of the parts will be fair market price. Flurida Group, Inc. will adopt the first-in and first-out inventory system according to generally accepted accounting principles in USA.
 
 
27

 

The management of Zhong Nan Fu Rui disclosed to Flurida Group, Inc. that, Zhong Nan Fu Rui adopted the cost plus pricing policies with market adjustment, negotiable with customers. Zhong Nan Fu Rui adopted the cost plus system for all the products for all customers including the product, icemakers exclusively distributed by Flurida Group, Inc. Specifically, the selling price is determined by total actual manufacturing cost of direct manufacturing materials (parts), direct manufacturing labor, and allocated manufacturing overhead cost, plus 5-10% of total manufacturing cost. Zhong Nan Fu Rui’s minimum gross profit margin is 5%.

Flurida Group also purchased the products from suppliers, Qingdao Fubida Electronics Co., Ltd, Shanghai Fulu International Trading Co., Ltd, and Chuzhou Fuda Mechanical and Electronics Co., Ltd on purchase orders basis.

Qingdao Fubida Electronics Co., Ltd, owned 100% indirectly by Jianfeng Ding and Yaru Huang, husband and wife. Qingdao Fubida Electronics Co., Ltd is a manufacturing company, and it was established in 2003 specializing in home appliance control components and subassemblies manufacturing, and located in Qingdao City, Shandong Province, China. The plant space is around 70,000 sq ft. 14units injection molding machine up to 600 metric tons.

Shanghai Fulu International Trading Co., Ltd. a trading company established in 2007, located at Shanghai, China, 100% owned indirectly by Jianfeng Ding and Yaru Huang.

Chuzhou Fuda Mechanical & Electronics Co., Ltd. owned 100% indirectly by Jianfeng Ding and Yaru Huang, husband and wife is an appliance components and sub-assemblies manufacturer established on March 18, 2008. Chuzhou Fuda is located in Chuzhou City, Anhui Province, China. The plant space is around 100,000sq. ft. with 18 molding machine up to 800 metric ton and 6 assemblies lines for appliance components and assemblies.

At the year ended December 31, 2011, the Company had ending inventory $1,803,675 that was purchased from Zhong Nan Fu Rui and ChuZhou FuDa.

From the period January 1 to December 31, 2012, Flurida Group, Inc. purchased Motors, parts and stoves from Zhong Nan Fu Rui at total cost of $1,515,914 for FOB shipping point at Qingdao, China.

Flurida Group, Inc. also purchased Motors, Deflectors, Icemakers, Magnets, Dac boxes, and other related parts from Qingdao Fubida Electronics Co., Ltd. at total cost of $113,103 for FOB shipping point at Qingdao, China.

The Company purchased Icemakers and motors from ChuZhou FuDa at total cost of $12,613,639 for FOB shipping point at Nanjing, China.

In addition, Flurida Group, Inc. purchased Magnets, Icemakers, Timers and related parts from Shanghai Fulu International Trading Co., Ltd., at total cost of $16,210 for FOB shipping point at Shanghai, China.

To manufacture the related refrigerator appliance parts, Zhong Nan Fu Rui, Chuzhou Fuda Mechanical & Electronics Co., Ltd, and Qingdao Fubida Electronics Co., needs key parts made in USA, which were purchased through Flurida Group, Inc. in USA. The costs of purchasing the parts were $852,521 in fiscal year 2012.
 
For the fiscal year ended December 31, 2012, the Company had total purchase of $15,111,387.

At the fiscal year ended December 31, 2012, the Company had total ending inventory $2,278,467.

For the period of January 1 to December 31, 2012, the company had freight cost of $22,868 and other cost of $4,439; and had a total purchase return and discount of $115,959.

Therefore, in the fiscal year ended December 31, 2012, the Company incurred a total cost of goods sold of $14,547,943.
 
 
28

 

Loan to Supplier

At January 1st, 2013, Flurida Group, Inc entered into a new loan agreement of $101,185 with the company’s primary supplier, Zhong Nan Fu Rui. The outstanding balance bears interest at 5.00%, pursuant to a written agreement, for the term from January 1st 2013 to December 31st 2013.

Director Independence

Our board of directors has determined that we do not have a board member that qualifies as “independent” as the term is used in Item 7(d)(3)(iv)(B) of Schedule 14A under the Securities Exchange Act of 1934, as amended, and as defined by Rule 4200(a)(15) of the NASDAQ Marketplace Rules.
 
Item 14. Principal Accountant Fees and Services
 
Enterprise CPA was our independent auditors for the fiscal years ended December 31, 2012 and 2009.
 
The following table shows the fees paid or accrued by us for the audit and other services provided by our auditor for fiscal 2012 and 2011.
 
   
2012
   
2011
 
             
Audit Fees
  $ 27500     $ 27,500  
Audit-Related Fees
               
Tax Fees
               
All Other Fees
               
Total
  $ 27,500     $ 27,500  
 
As defined by the SEC, (i) “audit fees” are fees for professional services rendered by our principal accountant for the audit of our annual financial statements and review of financial statements included in our Form 10-Q, or for services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for those fiscal years; (ii) “audit-related fees” are fees for assurance and related services by our principal accountant that are reasonably related to the performance of the audit or review of our financial statements and are not reported under “audit fees;” (iii) “tax fees” are fees for professional services rendered by our principal accountant for tax compliance, tax advice, and tax planning; and (iv) “all other fees” are fees for products and services provided by our principal accountant, other than the services reported under “audit fees,” “audit-related fees,” and “tax fees.”
 
Under applicable SEC rules, the Audit Committee is required to pre-approve the audit and non-audit services performed by the independent auditors in order to ensure that they do not impair the auditors’ independence. The SEC’s rules specify the types of non-audit services that an independent auditor may not provide to its audit client and establish the Audit Committee’s responsibility for administration of the engagement of the independent auditors. Until such time as we have an Audit Committee in place, the Board of Directors will pre-approve the audit and non-audit services performed by the independent auditors.
 
Consistent with the SEC’s rules, the Audit Committee Charter requires that the Audit Committee review and pre-approve all audit services and permitted non-audit services provided by the independent auditors to us or any of our subsidiaries. The Audit Committee may delegate pre-approval authority to a member of the Audit Committee and if it does, the decisions of that member must be presented to the full Audit Committee at its next scheduled meeting.
 
 
29

 
 
Item 15. Exhibits
 
 
Exhibit No.
 
Document Description
     
31.1
 
CERTIFICATION of CEO PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002.
     
31.2
 
CERTIFICATION of CFO PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002.
     
32.1 *
 
CERTIFICATION of CEO PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEYACT OF 2002
     
32.2 *
 
CERTIFICATION of CFO PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEYACT OF 2002
     
Exhibit 101
 
Interactive data files formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Operations, (iii) the Consolidated Statements of Cash Flows, and (iv) the Notes to the Consolidated Financial Statements.**
     
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**
____
* This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 of the Securities Exchange Act of 1934, whether made before or after the date hereof and irrespective of any general incorporation language in any filings.
 
** XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.
 
 
30

 
 
SIGNATURES
 
Pursuant to the requirements of Section 13 or 15(d) 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.

Flurida Group, Inc.,
a Nevada corporation
 
Title
 
Name
 
Date
 
Signature
             
Principal Executive Officer
 
Jianfeng Ding
 
March 29, 2013
 
/s/ Jianfeng Ding
 
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the registrant and in the capacities and on the dates indicated:
 
SIGNATURE
 
NAME
 
TITLE
 
DATE
             
/s/ Jianfeng Ding
 
Jianfeng Ding
 
Principal Executive Officer and Director
 
March 29, 2013
             
/s/ Yaru Hang
 
Yaru Hang
 
Principal Financial Officer and Principal Accounting Officer
 
March 29, 2013
             
/s/ Ying Zhong
 
Ying Zhong
 
Director
 
March 29, 2013
 
 
31

 
 
EXHIBIT INDEX
 
Exhibit No.
 
Document Description
     
31.1
 
CERTIFICATION of CEO PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002.
     
31.2
 
CERTIFICATION of CFO PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002.
     
32.1 *
 
CERTIFICATION of CEO PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEYACT OF 2002
     
32.2 *
 
CERTIFICATION of CFO PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEYACT OF 2002
     
Exhibit 101
 
Interactive data files formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Operations, (iii) the Consolidated Statements of Cash Flows, and (iv) the Notes to the Consolidated Financial Statements.**
     
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**
____
* This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 of the Securities Exchange Act of 1934, whether made before or after the date hereof and irrespective of any general incorporation language in any filings.
 
** XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.
 
 
32

EX-31.1 2 flug_ex311.htm CERTIFICATION flug_ex311.htm
EXHIBIT 31.1
 
CERTIFICATION
 
I, Jianfeng Ding, certify that:

1.
I have reviewed this report on Form 10-K of Flurida Group, Inc.;

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 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 officer 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 the registrant’s board of directors (or persons performing the equivalent function):

 
a)
all significant 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.
 
 
 
Flurida Group, Inc.
 
       
Dated: March 29, 2013
By:
/s/ Jianfeng Ding
 
   
Jianfeng Ding
 
   
Chief Executive Officer
 
EX-31.2 3 flug_ex312.htm CERTIFICATION flug_ex312.htm
EXHIBIT 31.2
 
CERTIFICATION
 
I, Yaru Hang, certify that:

1.
I have reviewed this report on Form 10-K of Flurida Group, Inc.;

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 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 officer 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 the registrant’s board of directors (or persons performing the equivalent function):

 
a)
all significant 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.
 
 
Dated: March 29, 2013
By:
/s/ Yaru Hang
 
   
Yaru Hang
 
   
Chief Financial Officer
 
EX-32.1 4 flug_ex321.htm CERTIFICATION flug_ex321.htm
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
 
Pursuant to 18 U.S.C. § 1350, as adopted pursuant to Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned hereby certifies that the Annual Report on Form 10-K for the year ended December 31, 2012 of Flurida Group, Inc. (the “Company”) fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 and that the information contained in such Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
 
 
Flurida Group, Inc.
 
       
Dated: March 29, 2013
By:
/s/ Jianfeng Ding
 
   
Jianfeng Ding
 
   
Chief Executive Officer
 
 
A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to Flurida Group, Inc. and will be retained by Flurida Group, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.
EX-32.2 5 flug_ex322.htm CERTIFICATION flug_ex322.htm
EXHIBIT 32.2
 
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
 
Pursuant to 18 U.S.C. § 1350, as adopted pursuant to Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned hereby certifies that the Annual Report on Form 10-K for the year ended December 31, 2012 of Flurida Group, Inc. (the “Company”) fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 and that the information contained in such Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
 
Dated: March 29, 2013
By:
/s/ Yaru Hang
 
   
Yaru Hang
 
   
Chief Financial Officer
 
 
A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to Flurida Group, Inc. and will be retained by Flurida Group, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.
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Note C. RELATED PARTY TRANSACTIONS
12 Months Ended
Dec. 31, 2012
Notes to Financial Statements  
Note C. RELATED PARTY TRANSACTIONS

Common Shares Issued to Executive and Non-Executive Officers and Directors

 

As of December 31, 2012, total 29,277,760 shares were issued to officers and directors.  Please see the table below for details:

 

Name   Total Shares     Total Amount     Percentage  
                   
Fenglan  Li     165,000       15,750       0.42 %
Fuling Li     115,000       10,750       0.29 %
Ying Zhong     2,000,000       200,000       5.10 %
Jianfeng Ding & Yaru Huang     26,997,760       323,998       68.89 %
    Total     29,277,760     $ 550,498       74.71 %

 

· Based on total outstanding issued shares as of December 31, 2012: 39,290,827

 

 

Cost of Goods Sold

 

The Company’s purchase is primarily from supplier, Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd and Chuzhou Fuda Mechanical & Electronics Co., Ltd, owned 100% by the founder of the Company, Jianfeng Ding.  Due to Jianfeng Ding, and Yaru Huang, husband and wife, combined hold 68.89% issued common shares for Flurida Group, Inc., the two entities, Flurida Group, Inc., and Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd and Chuzhou Fuda Mechanical & Electronics Co., Ltd are under common control according to EITF 02-5.

 

The products the Company will sell are manufactured in China by Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd. (“Zhong Nan Fu Rui”).  It was established in 2005 specializing in home appliance components and subassemblies manufacturing, and located in Qingdao City, Shandong Province, China.  On September 18, 2007, amended June 25, 2008 and further amended on August 4, 2008, Flurida Group, Inc. signed a five year distribution agreement with Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd.  Zhong Nan Fu Rui is a Chinese manufacturing company owned 100% by Mr. Jianfeng Ding, our president.  Under the terms of the agreement Zhong Nan Fu Rui authorizes Flurida to be its exclusive sales agent for the ice making product lines, including icemaker and ice water dispensing systems all over the world. The ice making product lines shall include the products that Zhong Nan Fu Rui developed before the agreement signed and the products that will be developed solely by Zhong Nan Fu Rui during the term of the agreement. Zhong Nan Fu Rui is the exclusive supplier of the products we sell.  Although the distribution agreement requires that the purchase price we will pay for these products will be comparable to what the Flurida would have paid a non-related party in market price, Mr. Ding may face a conflict in calculating the price the products are sold to Flurida and the determining amount of products the Flurida purchase.  However, because Mr. Ding has a fiduciary duty to Flurida and the shareholders, he has indicated that he will assure strict adherence to this provision of the agreement and will not require Flurida to purchase a quantity of products in excess of that which Flurida can reasonably afford or reasonably expect to sell in within two to three months of our purchase of the products.

 

The management of Flurida Group, Inc. believes that the purchase price for the parts from Zhong Nan Fu Rui will be market price.  Flurida Group, Inc. and Zhong Nan Fu Rui are two totally separated entities, i.e., Flurida Group, Inc. is a USA corporation and will fully comply with USA regulations and USA general accepted accounting principles; Zhong Nan Fu Rui is a Chinese company and it will comply with Chinese legal systems.

 

Flurida Group, Inc. and Zhong Nan Fu Rui will operate independently.  Zhong Nan Fu Rui, as a Chinese local manufacturer, will record their manufacturing costs and inventories based on the Chinese accounting regulations rulings.  But, when Flurida Group, Inc. purchases the parts from Zhong Nan Fu Rui, Flurida Group will record the actual costs paid to Zhong Nan Fu Rui as the costs for inventory of Flurida Group, Inc.  There is no any relationship for Zhong Nan Fu Rui’s manufacturing historic costs with Flurida Group’s inventory value.  Specifically, Flurida’s inventory value is equal to the purchase price or actual cost of the parts purchased from Zhong Nan Fu Rui, and the purchase price of the parts will be fair market price.  Flurida Group, Inc. will adopt the first-in and first-out inventory system according to generally accepted accounting principles in USA.

 

The management of Zhong Nan Fu Rui disclosed to Flurida Group, Inc. that, Zhong Nan Fu Rui adopted the cost plus pricing policies with market adjustment, negotiable with customers.  Zhong Nan Fu Rui adopted the cost plus system for all the products for all customers including the product, icemakers exclusively distributed by Flurida Group, Inc.  Specifically, the selling price is determined by total actual manufacturing cost of direct manufacturing materials (parts), direct manufacturing labor, and allocated manufacturing overhead cost, plus 5-10% of total manufacturing cost.  Zhong Nan Fu Rui’s minimum gross profit margin is 5%.

 

Flurida Group also purchased the products from suppliers, Qingdao Fubida Electronics Co., Ltd, Shanghai Fulu International Trading Co., Ltd, and Chuzhou Fuda Mechanical and Electronics Co., Ltd on purchase orders basis.

 

Qingdao Fubida Electronics Co., Ltd, owned 100% indirectly by Jianfeng Ding and Yaru Huang, husband and wife. Qingdao Fubida Electronics Co., Ltd is a manufacturing company, and it was established in 2003 specializing in home appliance control components and subassemblies manufacturing, and located in Qingdao City, Shandong Province, China. The plant space is around 70,000 sq ft. 14 units injection molding machine up to 600 metric tons.

 

Shanghai Fulu International Trading Co., Ltd. a trading company established in 2007, located at Shanghai, China, 100% owned indirectly by Jianfeng Ding and Yaru Huang.

 

Chuzhou Fuda Mechanical & Electronics Co., Ltd. owned 100% indirectly by Jianfeng Ding and Yaru Huang, husband and wife is an appliance components and sub-assemblies manufacturer established on March 18, 2008. Chuzhou Fuda is located in Chuzhou City, Anhui Province, China. The plant space is around 100,000sq. ft. with 18 molding machine up to 800 metric ton and 6 assemblies lines for appliance components and assemblies.

 

At the year ended December 31, 2011, the Company had ending inventory $1,803,675 that was purchased from Zhong Nan Fu Rui and ChuZhou FuDa.

 

From the period January 1 to December 31, 2012, Flurida Group, Inc. purchased Motors, parts and stoves from Zhong Nan Fu Rui at total cost of $1,515,914 for FOB shipping point at Qingdao, China.

 

Flurida Group, Inc. also purchased Motors, Deflectors, Icemakers, Magnets, Dac boxes, and other related parts from Qingdao Fubida Electronics Co., Ltd. at total cost of $113,103 for FOB shipping point at Qingdao, China.

 

The Company purchased Icemakers and motors from ChuZhou FuDa at total cost of $12,613,639 for FOB shipping point at Nanjing, China.

 

In addition, Flurida Group, Inc. purchased Magnets, Icemakers, Timers and related parts from Shanghai Fulu International Trading Co., Ltd., at total cost of $16,210 for FOB shipping point at Shanghai, China.

 

To manufacture the related refrigerator appliance parts, Zhong Nan Fu Rui, Chuzhou Fuda Mechanical & Electronics Co., Ltd, and Qingdao Fubida Electronics Co., needs key parts made in USA, which were purchased through Flurida Group, Inc. in USA. The costs of purchasing the parts were $852,521 in fiscal year 2012.

 

For the fiscal year ended December 31, 2012, the Company had total purchase of $15,111,387.

 

At the fiscal year ended December 31, 2012, the Company had total ending inventory $2,278,467.

 

For the period of January 1 to December 31, 2012, the company had freight cost of $22,868 and other cost of $4,439; and had a total purchase return and discount of $115,959.

 

Therefore, in the fiscal year ended December 31, 2012, the Company incurred a total cost of good sold of $14,547,943.

 

Loan to Supplier

 

At January 1st, 2013, Flurida Group, Inc entered into a new loan agreement of $ 101,185 with the company’s primary supplier, Zhong Nan Fu Rui. The outstanding balance bears interest at 5.00%, pursuant to a written agreement, for the term from January 1st 2013 to December 31st 2013.

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Note B. SIGNIFICANT ACCOUNTING POLICIES
12 Months Ended
Dec. 31, 2012
Notes to Financial Statements  
Note B. SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates

 

The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America requires management to make estimates and assumptions that affect certain amounts reported in the financial statements and disclosures. Accordingly, actual results could differ from those estimates.

 

Basis of accounting

 

The financial statements reflect the assets, revenues and expenditures of the Company on the accrued basis of accounting.

 

Principles of Consolidation

 

The consolidated financial statements of the Company include the accounts of Flurida Group USA and Flurida Group European S.R.L. All significant intercompany balances and transactions have been eliminated in consolidation.

 

Cash and Cash Equivalents

 

The Company considers all highly-liquid investments with an original maturity of three months or less when purchased to be cash equivalents.

 

Concentration of credit risk

 

The Company maintains its cash in bank accounts which, at times, may exceed the federally insured limits.  The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on cash.

 

Foreign Currency Translation

 

The Company has determined the United States dollars to be its functional currency for Flurida Group USA and European Euro to be its functional currency in European business.  Assets and liabilities were translated to U.S. dollars at the period-end exchange rate.  Statement of operations amounts were translated to U.S. dollars using the first date of each month during the year.  Gains and losses resulting from translating foreign currency financial statements are accumulated in other comprehensive income (loss), a separate component of shareholders’ equity.

 

Security Deposit

 

The Company started having an office in California State from September 2010, which is located at 24412 S Main ST, STE 105, Carson CA 90745.  Flurida Group USA Inc made $6,264 security deposit for leasing the property.

 

Property, Plant, and Equipment Depreciation

 

Property, plant, and equipment are stated at cost.  Depreciation is being provided principally by straight line methods over the estimated useful lives of the assets. Expenditures for maintenance and repairs, which do not improve or extend the expected useful lives of the assets, are expensed to operations while major repairs are capitalized.

 

The equipments were recorded as fixed asset to depreciate over 7 years and the electronic data processing equipments and furniture were recorded as fixed asset to depreciate over 5 years with straight line method.

 

In the fiscal year 2012, the Company purchased $8,033 computers and data processing equipments, and purchased $23,464 Furniture and equipments.

 

As of December 31, 2012, the company has furniture, Computer and data processing equipments, and equipments at a cost of $125,588, and $37,312 of accumulated depreciation expense was recorded.

 

Account Receivable

 

As of December 31, 2012, and 2011, the company had a total of $1,558,282 and $766,318 account receivable respectively from it major customers. Detail showed as below.

 

    12/31/2012      12/31/2011  
                 
Chuzhou FuDa   $ 140,892     $ -  
All other account receivable   $ 569     $ 7,800  
Electrolux- Australia   $ 222,579     $ 198,147  
Electrolux-Anderson-US   $ 25,388     $ -  
Electrolux-Mexico   $ 38,418     $ -  
Eelectrolux Major Appliance   $ -     $ 72,828  
Electrolux - Sweden   $ 5,442     $ -  
Electrolux Italy   $ 235,712     $ 24,550  
Electrolux Hungary   $ 342,987     $ 114,230  
General Electric Company   $ -     $ 17,683  
Electrolux ST.Cloud   $ 8,484     $ 81,596  
Stanco Metal Products Inc   $ 22,723     $ -  
Master Precidion Global LLC(MPG)   $ -     $ 75,455  
Sigma Refrigeration Ltd   $ 150,420     $    
Qingdao Fubida   $ 364,669     $ -  
ZhongNanFuRui   $ -     $ 174,030  
TOTAL   $ 1,558,282     $ 766,318  

 

Accrued Interest Receivable

 

In December 31st, 2012, the Company received $14,038 interest receivable that accrued from Zhong Nan Fu Rui as of December 31, 2012; at the meantime, Zhong Nan Fu Rui returned $123,417 to the Company.  In January 1, 2013, the company entered a new loan agreement of $101,185 with its main supplier Zhong Nan Fu Rui Mechanical electronics Co., Ltd at interest rate of 5.00%, term January 1, 2013 to December 31, 2013.

 

Account Payable

 

As of December 31, 2012, and 2011, the company had a total of $2,168,172 and $1,952,256 account payable respectively. The Company incurred accounts payable including professional fees, purchases, payroll and payroll tax liability, and other service fee payables.

 

As of December 31, 2012, the company has account payable of $2,168,172, which included $172,624 for Zhong Nan Fu Rui, $1,766,949 for Chu Zhou Fu Da, and $157,235 for US suppliers, $26,298 for salary and payroll tax payable, and $45,066 for all other account payable.

 

Income Tax Payable

 

The Company will file corporate tax return Form 1120 to Internal Revenue Service and IL 1120 to the State of Illinois. There is no income tax for the State of Nevada.  For the period of January 1 to December 31, 2012, the Company incurred income tax expense of $109,891, including federal tax of $83,279 and state tax of $26,612.  As of December 31, 2012, the income taxes payable of the Company was $0.

 

Inventory

 

The inventory was valued at cost of purchase from suppliers.

 

On June, 2008, Flurida Group, Inc signed consigned inventory agreements with Electrolux Home Products De Mexico, S.A. DEC.V., and Electrolux Home Products at Anderson, South Carolina (Electrolux),  Under the term of the agreement, the supplier, Flurida Group, Inc, agreed to produce, to maintain the transit the customized products per Electrolux’s specification. Electrolux maintain a storage location within Electrolux’s Juarez site for consigned inventory. And Flurida Group, Inc is facilitated to use of Electrolux’s storage location at such site to the sale of products to Electrolux; Electrolux will provide labor resources for receipt, stock up, and pulls of consigned products. Flurida Group, Inc., retains title and ownership of products while in transit to Electrolux’s site and while stored in the consigned inventory location. Title and ownership will pass to Electrolux when they withdraw products from the consigned inventory location. Upon withdrawal, Electrolux will pay for it under the payment term stated in the purchasing order correspond with the withdraw products. Products residing in the consigned inventory for 90 days with no activity due to non communicated demand change will no longer qualify for consignment, and will be considered as withdrawn product after 90 days. Accordingly, title passage and invoicing shall occur on such product per the term.

 

As of December 31, 2012, there were 5,985 icemakers and 55,944 pieces motor in Electrolux Juarez warehouse as of consignment inventory. Also, there were 275,832 pieces motors in Electrolux Anderson warehouse as of consignment inventory.

 

The company also had 16,800 Icemakers and 30,240 motors been shipped out at FOB shipping point Qingdao, China to Electrolux Juarez warehouse. The company also had 341,280 pieces Motor and 13,440 icemakers been shipped out at FOB shipping point Qingdao, China to Electrolux Anderson warehouse. Those purchases haven’t considered as a sale or a consignment inventory at the period ended December 31, 2012. However, it’s the in transit inventories of Flurida Group, Inc.

 

Moreover, the Company had purchased $43,786 parts from their US supplier, and had not shipped back to their China suppliers yet.

 

As a result, as of December 31, 2012, the company had total inventory of $2,278,467, including of 36,225 pieces Icemakers and 703,296 pieces motors inventory at a value $2,234,681, and a value of $43,786 related parts.

 

Revenues Recognition

 

Revenues include sales of appliance parts in Asia, Europe, and North America.

 

Revenues are recognized from product sales upon shipment, which is the point in time when risk of loss is transferred to the customer, net of estimated returns and allowances.

 

For the fiscal year ended December 31, 2012, the Company had total net revenue of $16,007,275.

 

For the period January 1 to December 31, 2012, the Company sold icemakers and motors to, Electrolux USA, located at Charlotte NC for sales of $10,991,669. The icemakers and motors were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd; all the icemakers and motors were shipped out at FOB shipping point Nanjing, China.

 

The company also sold motors, to Stanco Metal Products for $140,884; the motors were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd; all the motors were shipped out at FOB shipping point Nanjing, China.

 

For the fiscal year ended December 31, 2012, the Company sold icemakers, components, and tooling service to Electrolux –Australia for $964,720. The icemakers and components were manufactured and supplied by Chu Zhou Fu Da Mechanical and Electronics; all the icemakers and components were shipped out at FOB shipping point Nanjing, China.

 

The Company sold DAC Boxes, Deflector, push buttons, Magnets, Motors and other related parts to Electrolux – Italy for total $ 618,458. The DAC Boxes, Magnets, Motors and other related parts were manufactured and supplied by Zhong Nan Fu Rui and Chu Zhou Fuda; all the DAC Boxes magnets, and motors were shipped out at FOB shipping point Qingdao and Nanjing, China.

 

The Company also sold DAC Boxes, Magnets, Motors, and other related parts to Electrolux – Hungry for total $1,535,908. The DAC Boxes, magnets and Motors were manufactured and supplied by Zhong Nan Fu Rui and ChuZhou Fuda; all the DAC Boxes magnet, and motors were shipped out at FOB shipping point Qingdao and Nanjing, China.

 

The Company also sold DAC Boxes and related parts to Electrolux – Sweden for $ 24,141. The DAC Box and parts were manufactured and supplied by Zhong Nan Fu Rui and Chu Zhou Fuda; all the DAC Boxes were shipped out at FOB shipping point Qingdao and Nanjing, China.

 

The company sold Motors, icemakers, and some related refrigerator appliance parts to North Carolina Electrolux Major Appliances, Inc for $241,818. The parts, icemakers, and motors were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.

 

The Company also sold Motors to Electrolux –ST. Cloud for $98,435. The motors were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.

 

The Company sold Motors and other parts to Electrolux – Do Brasil for $107,662. The motors were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.

 

The company sold thermostats and icemakers to an US company, Exact Replacement Parts for $63,593. The parts were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.

 

The company sold icemakers to an US company, Domestic LLC for $90,397. And the icemakers were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd; all the icemakers were shipped out at FOB shipping point Nanjing, China.

 

The company sold parts and icemakers to General Electric Company for $34,710. The parts were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.

 

The company sold motors and components to Sigma Refrigeration Ltd for $183,120. The parts were manufactured and supplied by Zhong Nan Fu Rui, and were shipped out at FOB shipping point at Qingdao, China. The motors were manufactured and supplied by and ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.

 

The company sold stoves to The Paradigm Project for $197,689. The stoves were manufactured and supplied by Zhong Nan Fu Rui, and were shipped out at FOB shipping point at Qingdao, China.

 

For the period of January to December 31, 2012, the Company sold thermostats and other related key parts for icemakers and motors, to ChuZhouFuDa, Qingdao Fubida Electronic, and Zhong Nan Fu Rui. The parts were used for the icemakers and motors. Flurida Group purchased the parts from Wako Electronics, Inc., an US Company located at Louisville, KY 40299.  Flurida Group also sold Rocker Switch, the key parts for icemakers, to Zhong Nan Fu Rui and ChuZhouFuDa.  The parts, Rocker Switch, were used for the icemakers .The Company purchased the parts, Rocker Switch, from CW Industries, an US Company located at Southampton, PA; and also Flurida Group purchased some other related key parts from corporate America, and then sold to Zhong Nan Fu Rui, Qingdao Fubida Electronic, and ChuZhouFuDa. Flurida Group, Inc. adds averaged 5% - 10% margin based on the cost of purchase, then sold to them, so, $391,592, $443,841, and $13,716 were sold and invoiced to ChuZhouFuDa, Qingdao Fubida Electronic, and Zhong Nan Fu Rui respectively in the fiscal year ended December 31, 2012.

 

In the period of January 1, 2012 to December 31, 2012, the Company sold parts or provided services to America Corporation for a total of $28,912.

 

In summary, for the period of January 1 to December 31, 2012, the Company incurred the total gross sales of $16,171,265. And the Company had sales discount and return of $163,990, so, a total of $16,007,275 net sales were recorded. The cost of goods sold is discussed in details in Note C, Related Party Transactions.

 

Operating Expense

 

Operating Expenses includes research and development expense, all selling, general and administrative expenses, and depreciation expenses for Flurida Group Inc. For the fiscal year ended December 31, 2012 and 2011, the Company had total operating expenses of $ 1,205,671 and $1,040,836 respectively. Detail was showed on Exhibit A.

 

Payroll Expense

 

Started from January 2011, Flurida Group had salaries for officers Jianfeng Ding, Yaru Huang, and Ying Zhong for $350,000, $80,000, $80,000. The Social Security tax and Medicare tax were paid by both employer and employees in USA; employees also withheld portion of Federal and State tax calculate by each individual’s status. All of the tax was submitted to Internal Revenue Service and local government at a semiweekly basis.

 

The total payroll expenses for the year ended December 31, 2012 and 2011 were listed as follows:

 

    Year Ended     Year Ended  
    December 31,     December 31,  
    2012     2011  
Payroll Expense - ER            
Federal Unemployment Tax     546.00       584.89  
State Unemployment Tax     1,045.08       3,184.66  
US Medicare Tax - ER     9,812.09       8,496.89  
US Social Security Tax -ER     27,081.33       20,953.17  
Payroll Expense - ER - Other     350.87       232.46  
Total Payroll Expense - ER     38,835.37       33,452.07  
Payroll Expenses - EE                
Federal Tax Withholding     123,083.84       106,358.47  
State Tax Withholding     42,303.56       32,316.65  
US Medicare Tax -EE     9,812.07       8,496.89  
US Net Salaries payment - EE     481,160.36       424,108.86  
US Social Security Tax - EE     18,345.43       14,697.27  
Total Payroll Expenses - EE     674,705.26       585,978.14  
                 
Total Payroll Expenses     713,540.63       619,430.21  

 

Professional Fee

 

Professional fees are consist of accounting and auditing fee, legal fee, commission and consulting expenses, SEC filling fee, and other professional expenses. The total professional fees were $125,781 and $95,009 for the fiscal year ended December 31, 2012 and 2011 respectively.

 

Basics and Diluted Net Loss Per Common Share

 

Basic earnings per share is computed by dividing income available to common shareholders (the numerator) by the weighted-average number of common shares outstanding (the denominator) for the period. Diluted earnings per share assume that any dilutive convertible securities outstanding were converted, with related preferred stock dividend requirements and outstanding common shares adjusted accordingly. It also assumes that outstanding common shares were increased by shares issuable upon exercise of those stock options for which market price exceeds the exercise price, less shares which could have been purchased by us with the related proceeds. In periods of losses, diluted loss per share is computed on the same basis as basic loss per share as the inclusion of any other potential shares outstanding would be anti-dilutive.

 

The Company only issued one type of shares, i.e., common shares only.  There are no other types securities were issued.  Accordingly, the diluted and basics net loss per common share are the same.

 

Income Tax

 

Income taxes are provided for tax effects of transactions reported in the financial statements and consist of taxes currently due plus deferred taxes. Deferred taxes are recognized for differences between the bases of assets and liabilities for financial statement and income tax purposes. The differences in asset and liability bases relate primarily to organization and start-up costs (use of different methods and periods to calculate deduction). Deferred taxes are also recognized for operating losses and tax credits that are available to offset future income taxes. The deferred tax assets and/or liabilities represent the future tax return consequences of those differences, which will either be taxable or deductible when the assets and liabilities are recovered or settled. The components of the deferred tax asset and liability are classified as current and concurrent based on their characteristics. Valuation allowances are provided for deferred tax assets based on management’s projection of the sufficiency of future taxable income to realize the assets.

 

Recent Accounting Pronouncements

 

Business Combinations —The new guidance on business combinations retains the underlying concepts of the previously issued standard in that the acquirer of a business is required to account for the business combination at fair value. As with previous guidance, the assets and liabilities of the acquired business are recorded at their fair values at the date of acquisition. The excess of the purchase price over the estimated fair values are recorded as goodwill. The new pronouncement results in some changes to the method of applying the acquisition method of accounting for business combinations in a number of significant aspects. Under the new guidance, all acquisition costs are expensed as incurred and in-process research and development costs are recorded at fair value as an indefinite-lived intangible asset. Prior to the adoption, in-process research and development costs were immediately expensed and acquisition costs were capitalized. Further, the new guidance generally requires restructuring charges associated with a business combination to be expensed subsequent to the acquisition date.

 

Fair Value Measurements and Disclosures — The pronouncements define fair value, establish guidelines for measuring fair value, and expand disclosures regarding fair value measurements.

 

Derivative Instruments and Hedging Activities — The pronouncement requires additional disclosures about the objectives of derivative instruments and hedging activities, the method of accounting for such instruments, and a tabular disclosure of the effects of such instruments and related hedged items on Financial Statements. The pronouncement does not change the accounting treatment for derivative instruments.

 

Variable Interest Entities and Transfers of Financial Assets and Extinguishments of Liabilities — The pronouncement on transfers of financial assets and extinguishments of liabilities removes the concept of a qualifying special-purpose entity and removes the exception from applying variable interest entity accounting to qualifying special-purpose entities. The new guidance on variable interest entities requires an entity to perform an ongoing analysis to determine whether the entity’s variable interest or interests give it a controlling financial interest in a variable interest entity. The pronouncements are effective for fiscal years beginning after November 15, 2009.

 

Management does not anticipate that the adoption of these standards will have a material impact on the financial statements.

 

Comprehensive Income

 

The company’s comprehensive income is comprised of net income, unrealized gains and losses on marketable securities classified foreign currency translation adjustments, and unrealized gains and losses on derivative financial instruments related to foreign currency hedging.

 

XML 17 R2.htm IDEA: XBRL DOCUMENT v2.4.0.6
CONSOLIDATED BALANCE SHEETS (USD $)
Dec. 31, 2012
Dec. 31, 2011
Current assets:    
Cash and cash equivalents $ 194,265 $ 741,230
Accounts receivable, net 1,558,282 766,318
Inventory 2,278,467 1,803,674
Total Current Assets 4,031,014 3,311,222
Property, plant and equipment, net 88,276 77,737
Other assets:    
Loan to supplier 101,185 224,602
Accrued interest receivable    2,808
Security deposit 6,264 6,264
Total Other Assets 107,449 233,674
TOTAL ASSETS 4,226,739 3,622,633
Current liabilities:    
Account payable 2,168,172 1,952,256
Income taxes payable      
Unearned revenue 224,976 10,635
Total current liabilities 2,393,148 1,962,891
Stockholders' Equity:    
Common stock, $0.001 par value; 200,000,000 shares authorized;39,290,827 shares issued and outstanding. 39,291 38,991
Paid-in capital 1,251,313 1,221,613
Retained earnings 543,164 388,073
Accumulated other comprehensive Income (loss) (177) 11,065
Total stockholders' equity 1,833,591 1,659,742
TOTAL LIABILITIES and EQUITY $ 4,226,739 $ 3,622,633
XML 18 R6.htm IDEA: XBRL DOCUMENT v2.4.0.6
CONSOLIDATED STATEMENT OF CASH FLOWS (USD $)
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Operating Activities:    
Net Income $ 155,091 $ 200,501
Adjustments to reconcile net income to net cash provided by operating activities:    
Non-cash portion of share based legal fee expense 30,000   
Depreciation expense 20,957 14,965
Inventory (474,793) (270,454)
Decrease in accrued interest receivable 2,808 19,497
Increase in account receivable (791,964) 1,516,322
Increase in account payable 215,916 (1,680,392)
Increase in income tax payable    (79,307)
Increase in Unearned Income 214,341 8,271
Net cash provided by operating activities (627,644) (270,597)
Investing Activities:    
Purchase Property (31,496) (46,564)
Net cash provided by investing activities (31,496) (46,564)
Financing Activities:    
Proceeds from issuance of common stock     
Loan return from supplier 123,417 60,024
Net cash provided by financing activities 123,417 60,024
Effect of Exchange Rate on Cash (11,242) 5,542
Net increase (decrease) in cash and cash equivalents (546,965) (251,595)
Cash and cash equivalents at beginning of the period 741,230 992,825
Cash and cash equivalents at end of the period $ 194,265 $ 741,230
XML 19 R22.htm IDEA: XBRL DOCUMENT v2.4.0.6
GOING CONCERN (Details) (USD $)
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Operating expenses    
Administration Expense $ 1,681 $ 2,071
Bad debt expense    5,895
Bank Service Charges 58,182 4,449
Business Registration 904 1,513
Certification fee 66,654 73,832
Computer and Internet Expenses 1,317 1,100
Credit card finance charge 218 60
Depreciation and amortization expenses 20,957 14,965
Fuel charge 3,049 883
Gift and Promotion 9,504 5,048
Insurance Expense 945 945
Meals and Entertainment 19,822 14,293
Office Supplies 8,262 12,920
Parking Fee 864 376
Payroll Expense - ER 38,835 33,452
Payroll Expenses - EE 674,705 585,978
Penalty & Fine Expenses    218
Postage and Shipping 8,154 6,035
Professional Fees 125,781 95,009
Rent Expense 52,687 52,075
Repair and Maintenance 3,118 6,104
Research and Development Expense 17,311 15,191
Service Cost 340 4,406
Telephone Expense 9,891 9,284
Travel Expense    
Air agent fee 2,008 789
Airfare 42,425 58,332
Car Rental 5,687 3,872
Hotel Expense 29,377 27,954
Local Transportation 590 1,511
Travel Expense - Other    1,134
Total Travel Expense 80,087 93,592
Utilities 2,401 1,142
Total Operating Expense $ 1,205,671 $ 1,040,836
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XML 21 R7.htm IDEA: XBRL DOCUMENT v2.4.0.6
Note A. BUSINESS DESCRIPTION
12 Months Ended
Dec. 31, 2012
Notes to Financial Statements  
Note A. BUSINESS DESCRIPTION

Flurida Group, Inc. (the “Company”), incorporated under the laws of Nevada on December 19, 2006, with registered address at 502 East John Street, Carson City, NV 89706.  Flurida Group, Inc. operates its business in USA as Flurida Group USA, Inc., the Company’s wholly owned branch located in the State of Illinois and has principle office at 22 West Washington ST, Suite 1500, Chicago, IL 60602.

 

Flurida Group leased a warehouse at 24412 S Main Street, Carson, CA 90745.

 

Flurida Group Inc closed its subsidiary Flurida Group European S.R.L (“Flurida European”) in July 2011.

 

The company closed its Flurida Qingdao China office in July, 2009.

 

The Company’s main business includes sourcing, distribution and marketing of appliance parts in Asia, Europe, North and South America.

 

These parts are manufactured in China by Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd. (“Zhong Nan Fu Rui”) and Chuzhou Fuda Mechanical & Electronics Co., Ltd (“ChuZhou Fuda”). Zhong Nan Fu Rui was established in 2005 specializing in home appliance components and subassemblies manufacturing, and located in Qingdao City, Shandong Province, China. ChuZhou Fuda was an appliance components and sub-assemblies manufacturer established on March 18, 2008 and located in Chuzhou City, Anhui Province, China. On September 18, 2007, Flurida Group, Inc. signed a long-term distribution agreement with Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd. Zhong Nan Fu Rui is a Chinese manufacturing company owned 100% by Mr. Jianfeng Ding, the founder of the Company.

 

XML 22 R3.htm IDEA: XBRL DOCUMENT v2.4.0.6
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)
Dec. 31, 2012
Dec. 31, 2011
Stockholders' Equity:    
Common stock, par value per share $ 0.001 $ 0.001
Common stock, shares authorized 200,000,000 200,000,000
Common stock, shares issued 39,290,827 38,990,827
Common stock, shares outstanding 39,290,827 38,990,827
XML 23 R17.htm IDEA: XBRL DOCUMENT v2.4.0.6
SIGNIFICANT ACCOUNTING POLICIES (Details 1) (USD $)
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Payroll Expense - ER    
Federal Unemployment Tax $ 546 $ 584.89
State Unemployment Tax 1,045.08 3,184.66
US Medicare Tax - ER 9,812.09 8,496.89
US Social Security Tax -ER 27,081.33 20,953.17
Payroll Expense - ER - Other 350.87 232.46
Total Payroll Expense - ER 38,835.37 33,452.07
Payroll Expenses - EE    
Federal Tax Withholding 123,083.84 106,358.47
State Tax Withholding 42,303.56 32,316.65
US Medicare Tax -EE 9,812.07 8,496.89
US Net Salaries payment - EE 481,160.36 424,108.86
US Social Security Tax - EE 18,345.43 14,697.27
Total Payroll Expenses - EE 674,705.26 585,978.14
Total Payroll Expenses $ 713,540.63 $ 619,430.21
XML 24 R1.htm IDEA: XBRL DOCUMENT v2.4.0.6
Document and Entity Information (USD $)
12 Months Ended
Dec. 31, 2012
Jun. 30, 2012
Document And Entity Information    
Entity Registrant Name FLURIDA GROUP INC,  
Entity Central Index Key 0001430960  
Document Type 10-K  
Document Period End Date Dec. 31, 2012  
Amendment Flag false  
Current Fiscal Year End Date --12-31  
Is Entity a Well-known Seasoned Issuer? No  
Is Entity a Voluntary Filer? No  
Is Entity's Reporting Status Current? Yes  
Entity Filer Category Smaller Reporting Company  
Entity Public Float   $ 116,557
Entity Common Stock, Shares Outstanding 39,290,827  
Document Fiscal Period Focus FY  
Document Fiscal Year Focus 2012  
XML 25 R18.htm IDEA: XBRL DOCUMENT v2.4.0.6
SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) (USD $)
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Significant accounting policies details    
Accumulated depreciation expense $ 37,312  
Cost of furniture, Computer and data processing equipments, and equipments 125,588  
Purchase of furniture and equipments 23,464  
Purchase of Computer and data processing equipments 8,033  
Account Receivable 1,558,282 766,318
Accrued interest receivable    2,808
Account payable 2,168,172 1,952,256
Income tax payable    (79,307)
Income tax expense 109,891 153,641
Federal tax 83,279  
State tax 26,612  
Ice makers and piece motors invenotry value 2,278,467  
Icemakers Inventory, Number 36,225  
Icemakers Inventory 2,234,681  
Motors Inventory, Number 703,296  
Motors Inventory 43,786  
Revenue: 16,007,275 13,780,374
Gross sales 16,171,265  
Sales returns and discounts 163,990  
Net sales 16,007,275  
Operating expenses 1,205,671 1,040,836
Research and development expense 17,311 15,191
Depreciation expenses 20,957 14,965
Selling, general and administrative expense 1,167,403 1,010,680
Professional fees 125,781 95,009
Icemakers, Number 5,985  
Motor, Number 55,944  
Motors in Electrolux Anderson warehouse, Number 275,832  
Zhong Nan Fu Rui [Member]
   
Significant accounting policies details    
Accrued interest receivable 14,038  
Returned to the company 123,417  
Account payable 172,624  
Gross sales 13,716  
Chuzhou FuDa [Member]
   
Significant accounting policies details    
Account payable 1,766,949  
Electrolux USA [Member]
   
Significant accounting policies details    
Gross sales 10,991,669  
Electrolux Australia [Member]
   
Significant accounting policies details    
Gross sales 964,720  
America Corporation [Member]
   
Significant accounting policies details    
Gross sales 28,912  
US Suppliers [Member]
   
Significant accounting policies details    
Account payable 157,235  
Salary and payroll tax payable 26,298  
Other account payable 45,066  
Chuzhou FuDa [Member]
   
Significant accounting policies details    
Gross sales 391,592  
Qiongdao Fu Bi Da [Member]
   
Significant accounting policies details    
Gross sales $ 443,841  
XML 26 R4.htm IDEA: XBRL DOCUMENT v2.4.0.6
CONSOLIDATED STATEMENT OF OPERATION (USD $)
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Consolidated Statement Of Operation    
Revenues: $ 16,007,275 $ 13,780,374
Cost of Goods Sold 14,547,943 12,400,149
Gross Profit 1,459,332 1,380,225
Operating expenses:    
Research and development 17,311 15,191
Selling, general and administrative expenses 1,167,403 1,010,680
Depreciation and amortization expenses 20,957 14,965
Total Operating Expenses 1,205,671 1,040,836
Operating Income 253,661 339,389
Investment income, net 13,543 14,753
Interest expense, net 2,222   
Income before taxes 264,982 354,142
Income tax expense 109,891 153,641
Net Income 155,091 200,501
Net Income (Loss) per common share-Basics $ 0.00 $ 0.01
Net Income (Loss) per common share-Diluted $ 0.00 $ 0.01
Other comprehensive Income(Loss), net of tax:    
Foreign currency translation adjustments (11,242) 5,542
Total other comprehensive Income(Loss) (11,242) 5,542
Comprehensive Income(Loss) $ 143,849 $ 206,043
XML 27 R12.htm IDEA: XBRL DOCUMENT v2.4.0.6
SIGNIFICANT ACCOUNTING POLICIES (Policies)
12 Months Ended
Dec. 31, 2012
Notes to Financial Statements  
Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America requires management to make estimates and assumptions that affect certain amounts reported in the financial statements and disclosures. Accordingly, actual results could differ from those estimates.

Basis of accounting

The financial statements reflect the assets, revenues and expenditures of the Company on the accrued basis of accounting.

Principles of Consolidation

The consolidated financial statements of the Company include the accounts of Flurida Group USA and Flurida Group European S.R.L. All significant intercompany balances and transactions have been eliminated in consolidation.

Cash and Cash Equivalents

The Company considers all highly-liquid investments with an original maturity of three months or less when purchased to be cash equivalents.

Concentration of credit risk

The Company maintains its cash in bank accounts which, at times, may exceed the federally insured limits.  The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on cash.

Foreign Currency Translation

The Company has determined the United States dollars to be its functional currency for Flurida Group USA and European Euro to be its functional currency in European business.  Assets and liabilities were translated to U.S. dollars at the period-end exchange rate.  Statement of operations amounts were translated to U.S. dollars using the first date of each month during the year.  Gains and losses resulting from translating foreign currency financial statements are accumulated in other comprehensive income (loss), a separate component of shareholders’ equity.

Security Deposit

The Company started having an office in California State from September 2010, which is located at 24412 S Main ST, STE 105, Carson CA 90745.  Flurida Group USA Inc made $6,264 security deposit for leasing the property.

Property, Plant, and Equipment Depreciation

Property, plant, and equipment are stated at cost.  Depreciation is being provided principally by straight line methods over the estimated useful lives of the assets. Expenditures for maintenance and repairs, which do not improve or extend the expected useful lives of the assets, are expensed to operations while major repairs are capitalized.

 

The equipments were recorded as fixed asset to depreciate over 7 years and the electronic data processing equipments and furniture were recorded as fixed asset to depreciate over 5 years with straight line method.

 

In the fiscal year 2012, the Company purchased $8,033 computers and data processing equipments, and purchased $23,464 Furniture and equipments.

 

As of December 31, 2012, the company has furniture, Computer and data processing equipments, and equipments at a cost of $125,588, and $37,312 of accumulated depreciation expense was recorded.

Account Receivable

As of December 31, 2012, and 2011, the company had a total of $1,558,282 and $766,318 account receivable respectively from it major customers. Detail showed as below.

 

    12/31/2012      12/31/2011  
                 
Chuzhou FuDa   $ 140,892     $ -  
All other account receivable   $ 569     $ 7,800  
Electrolux- Australia   $ 222,579     $ 198,147  
Electrolux-Anderson-US   $ 25,388     $ -  
Electrolux-Mexico   $ 38,418     $ -  
Eelectrolux Major Appliance   $ -     $ 72,828  
Electrolux - Sweden   $ 5,442     $ -  
Electrolux Italy   $ 235,712     $ 24,550  
Electrolux Hungary   $ 342,987     $ 114,230  
General Electric Company   $ -     $ 17,683  
Electrolux ST.Cloud   $ 8,484     $ 81,596  
Stanco Metal Products Inc   $ 22,723     $ -  
Master Precidion Global LLC(MPG)   $ -     $ 75,455  
Sigma Refrigeration Ltd   $ 150,420     $    
Qingdao Fubida   $ 364,669     $ -  
ZhongNanFuRui   $ -     $ 174,030  
TOTAL   $ 1,558,282     $ 766,318  
Accrued Interest Receivable

In December 31st, 2012, the Company received $14,038 interest receivable that accrued from Zhong Nan Fu Rui as of December 31, 2012; at the meantime, Zhong Nan Fu Rui returned $123,417 to the Company.  In January 1, 2013, the company entered a new loan agreement of $101,185 with its main supplier Zhong Nan Fu Rui Mechanical electronics Co., Ltd at interest rate of 5.00%, term January 1, 2013 to December 31, 2013.

Account Payable

As of December 31, 2012, and 2011, the company had a total of $2,168,172 and $1,952,256 account payable respectively. The Company incurred accounts payable including professional fees, purchases, payroll and payroll tax liability, and other service fee payables.

 

As of December 31, 2012, the company has account payable of $2,168,172, which included $172,624 for Zhong Nan Fu Rui, $1,766,949 for Chu Zhou Fu Da, and $157,235 for US suppliers, $26,298 for salary and payroll tax payable, and $45,066 for all other account payable.

Income Tax Payable

The Company will file corporate tax return Form 1120 to Internal Revenue Service and IL 1120 to the State of Illinois. There is no income tax for the State of Nevada.  For the period of January 1 to December 31, 2012, the Company incurred income tax expense of $109,891, including federal tax of $83,279 and state tax of $26,612.  As of December 31, 2012, the income taxes payable of the Company was $0.

Inventory

The inventory was valued at cost of purchase from suppliers.

 

On June, 2008, Flurida Group, Inc signed consigned inventory agreements with Electrolux Home Products De Mexico, S.A. DEC.V., and Electrolux Home Products at Anderson, South Carolina (Electrolux),  Under the term of the agreement, the supplier, Flurida Group, Inc, agreed to produce, to maintain the transit the customized products per Electrolux’s specification. Electrolux maintain a storage location within Electrolux’s Juarez site for consigned inventory. And Flurida Group, Inc is facilitated to use of Electrolux’s storage location at such site to the sale of products to Electrolux; Electrolux will provide labor resources for receipt, stock up, and pulls of consigned products. Flurida Group, Inc., retains title and ownership of products while in transit to Electrolux’s site and while stored in the consigned inventory location. Title and ownership will pass to Electrolux when they withdraw products from the consigned inventory location. Upon withdrawal, Electrolux will pay for it under the payment term stated in the purchasing order correspond with the withdraw products. Products residing in the consigned inventory for 90 days with no activity due to non communicated demand change will no longer qualify for consignment, and will be considered as withdrawn product after 90 days. Accordingly, title passage and invoicing shall occur on such product per the term.

 

As of December 31, 2012, there were 5,985 icemakers and 55,944 pieces motor in Electrolux Juarez warehouse as of consignment inventory. Also, there were 275,832 pieces motors in Electrolux Anderson warehouse as of consignment inventory.

 

The company also had 16,800 Icemakers and 30,240 motors been shipped out at FOB shipping point Qingdao, China to Electrolux Juarez warehouse. The company also had 341,280 pieces Motor and 13,440 icemakers been shipped out at FOB shipping point Qingdao, China to Electrolux Anderson warehouse. Those purchases haven’t considered as a sale or a consignment inventory at the period ended December 31, 2012. However, it’s the in transit inventories of Flurida Group, Inc.

 

Moreover, the Company had purchased $43,786 parts from their US supplier, and had not shipped back to their China suppliers yet.

 

As a result, as of December 31, 2012, the company had total inventory of $2,278,467, including of 36,225 pieces Icemakers and 703,296 pieces motors inventory at a value $2,234,681, and a value of $43,786 related parts.

Revenues Recognition

Revenues include sales of appliance parts in Asia, Europe, and North America.

 

Revenues are recognized from product sales upon shipment, which is the point in time when risk of loss is transferred to the customer, net of estimated returns and allowances.

 

For the fiscal year ended December 31, 2012, the Company had total net revenue of $16,007,275.

 

For the period January 1 to December 31, 2012, the Company sold icemakers and motors to, Electrolux USA, located at Charlotte NC for sales of $10,991,669. The icemakers and motors were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd; all the icemakers and motors were shipped out at FOB shipping point Nanjing, China.

 

The company also sold motors, to Stanco Metal Products for $140,884; the motors were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd; all the motors were shipped out at FOB shipping point Nanjing, China.

 

For the fiscal year ended December 31, 2012, the Company sold icemakers, components, and tooling service to Electrolux –Australia for $964,720. The icemakers and components were manufactured and supplied by Chu Zhou Fu Da Mechanical and Electronics; all the icemakers and components were shipped out at FOB shipping point Nanjing, China.

 

The Company sold DAC Boxes, Deflector, push buttons, Magnets, Motors and other related parts to Electrolux – Italy for total $ 618,458. The DAC Boxes, Magnets, Motors and other related parts were manufactured and supplied by Zhong Nan Fu Rui and Chu Zhou Fuda; all the DAC Boxes magnets, and motors were shipped out at FOB shipping point Qingdao and Nanjing, China.

 

The Company also sold DAC Boxes, Magnets, Motors, and other related parts to Electrolux – Hungry for total $1,535,908. The DAC Boxes, magnets and Motors were manufactured and supplied by Zhong Nan Fu Rui and ChuZhou Fuda; all the DAC Boxes magnet, and motors were shipped out at FOB shipping point Qingdao and Nanjing, China.

 

The Company also sold DAC Boxes and related parts to Electrolux – Sweden for $ 24,141. The DAC Box and parts were manufactured and supplied by Zhong Nan Fu Rui and Chu Zhou Fuda; all the DAC Boxes were shipped out at FOB shipping point Qingdao and Nanjing, China.

 

The company sold Motors, icemakers, and some related refrigerator appliance parts to North Carolina Electrolux Major Appliances, Inc for $241,818. The parts, icemakers, and motors were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.

 

The Company also sold Motors to Electrolux –ST. Cloud for $98,435. The motors were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.

 

The Company sold Motors and other parts to Electrolux – Do Brasil for $107,662. The motors were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.

 

The company sold thermostats and icemakers to an US company, Exact Replacement Parts for $63,593. The parts were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.

 

The company sold icemakers to an US company, Domestic LLC for $90,397. And the icemakers were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd; all the icemakers were shipped out at FOB shipping point Nanjing, China.

 

The company sold parts and icemakers to General Electric Company for $34,710. The parts were manufactured and supplied by ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.

 

The company sold motors and components to Sigma Refrigeration Ltd for $183,120. The parts were manufactured and supplied by Zhong Nan Fu Rui, and were shipped out at FOB shipping point at Qingdao, China. The motors were manufactured and supplied by and ChuZhou FuDa Mechanical and Electronics Co., Ltd, and were shipped out at FOB shipping point Nanjing, China.

 

The company sold stoves to The Paradigm Project for $197,689. The stoves were manufactured and supplied by Zhong Nan Fu Rui, and were shipped out at FOB shipping point at Qingdao, China.

 

For the period of January to December 31, 2012, the Company sold thermostats and other related key parts for icemakers and motors, to ChuZhouFuDa, Qingdao Fubida Electronic, and Zhong Nan Fu Rui. The parts were used for the icemakers and motors. Flurida Group purchased the parts from Wako Electronics, Inc., an US Company located at Louisville, KY 40299.  Flurida Group also sold Rocker Switch, the key parts for icemakers, to Zhong Nan Fu Rui and ChuZhouFuDa.  The parts, Rocker Switch, were used for the icemakers .The Company purchased the parts, Rocker Switch, from CW Industries, an US Company located at Southampton, PA; and also Flurida Group purchased some other related key parts from corporate America, and then sold to Zhong Nan Fu Rui, Qingdao Fubida Electronic, and ChuZhouFuDa. Flurida Group, Inc. adds averaged 5% - 10% margin based on the cost of purchase, then sold to them, so, $391,592, $443,841, and $13,716 were sold and invoiced to ChuZhouFuDa, Qingdao Fubida Electronic, and Zhong Nan Fu Rui respectively in the fiscal year ended December 31, 2012.

 

In the period of January 1, 2012 to December 31, 2012, the Company sold parts or provided services to America Corporation for a total of $28,912.

 

In summary, for the period of January 1 to December 31, 2012, the Company incurred the total gross sales of $16,171,265. And the Company had sales discount and return of $163,990, so, a total of $16,007,275 net sales were recorded. The cost of goods sold is discussed in details in Note C, Related Party Transactions.

Operating Expense

Operating Expenses includes research and development expense, all selling, general and administrative expenses, and depreciation expenses for Flurida Group Inc. For the fiscal year ended December 31, 2012 and 2011, the Company had total operating expenses of $ 1,205,671 and $1,040,836 respectively. Detail was showed on Exhibit A.

Payroll Expense

Started from January 2011, Flurida Group had salaries for officers Jianfeng Ding, Yaru Huang, and Ying Zhong for $350,000, $80,000, $80,000. The Social Security tax and Medicare tax were paid by both employer and employees in USA; employees also withheld portion of Federal and State tax calculate by each individual’s status. All of the tax was submitted to Internal Revenue Service and local government at a semiweekly basis.

 

The total payroll expenses for the year ended December 31, 2012 and 2011 were listed as follows:

 

    Year Ended     Year Ended  
    December 31,     December 31,  
    2012     2011  
Payroll Expense - ER            
Federal Unemployment Tax     546.00       584.89  
State Unemployment Tax     1,045.08       3,184.66  
US Medicare Tax - ER     9,812.09       8,496.89  
US Social Security Tax -ER     27,081.33       20,953.17  
Payroll Expense - ER - Other     350.87       232.46  
Total Payroll Expense - ER     38,835.37       33,452.07  
Payroll Expenses - EE                
Federal Tax Withholding     123,083.84       106,358.47  
State Tax Withholding     42,303.56       32,316.65  
US Medicare Tax -EE     9,812.07       8,496.89  
US Net Salaries payment - EE     481,160.36       424,108.86  
US Social Security Tax - EE     18,345.43       14,697.27  
Total Payroll Expenses - EE     674,705.26       585,978.14  
                 
Total Payroll Expenses     713,540.63       619,430.21  
Professional Fee

Professional fees are consist of accounting and auditing fee, legal fee, commission and consulting expenses, SEC filling fee, and other professional expenses. The total professional fees were $125,781 and $95,009 for the fiscal year ended December 31, 2012 and 2011 respectively.

Basics and Diluted Net Loss Per Common Share

Basic earnings per share is computed by dividing income available to common shareholders (the numerator) by the weighted-average number of common shares outstanding (the denominator) for the period. Diluted earnings per share assume that any dilutive convertible securities outstanding were converted, with related preferred stock dividend requirements and outstanding common shares adjusted accordingly. It also assumes that outstanding common shares were increased by shares issuable upon exercise of those stock options for which market price exceeds the exercise price, less shares which could have been purchased by us with the related proceeds. In periods of losses, diluted loss per share is computed on the same basis as basic loss per share as the inclusion of any other potential shares outstanding would be anti-dilutive.

 

The Company only issued one type of shares, i.e., common shares only.  There are no other types securities were issued.  Accordingly, the diluted and basics net loss per common share are the same.

Income Tax

Income taxes are provided for tax effects of transactions reported in the financial statements and consist of taxes currently due plus deferred taxes. Deferred taxes are recognized for differences between the bases of assets and liabilities for financial statement and income tax purposes. The differences in asset and liability bases relate primarily to organization and start-up costs (use of different methods and periods to calculate deduction). Deferred taxes are also recognized for operating losses and tax credits that are available to offset future income taxes. The deferred tax assets and/or liabilities represent the future tax return consequences of those differences, which will either be taxable or deductible when the assets and liabilities are recovered or settled. The components of the deferred tax asset and liability are classified as current and concurrent based on their characteristics. Valuation allowances are provided for deferred tax assets based on management’s projection of the sufficiency of future taxable income to realize the assets.

Recent Accounting Pronouncements

Business Combinations —The new guidance on business combinations retains the underlying concepts of the previously issued standard in that the acquirer of a business is required to account for the business combination at fair value. As with previous guidance, the assets and liabilities of the acquired business are recorded at their fair values at the date of acquisition. The excess of the purchase price over the estimated fair values are recorded as goodwill. The new pronouncement results in some changes to the method of applying the acquisition method of accounting for business combinations in a number of significant aspects. Under the new guidance, all acquisition costs are expensed as incurred and in-process research and development costs are recorded at fair value as an indefinite-lived intangible asset. Prior to the adoption, in-process research and development costs were immediately expensed and acquisition costs were capitalized. Further, the new guidance generally requires restructuring charges associated with a business combination to be expensed subsequent to the acquisition date.

 

Fair Value Measurements and Disclosures — The pronouncements define fair value, establish guidelines for measuring fair value, and expand disclosures regarding fair value measurements.

 

Derivative Instruments and Hedging Activities — The pronouncement requires additional disclosures about the objectives of derivative instruments and hedging activities, the method of accounting for such instruments, and a tabular disclosure of the effects of such instruments and related hedged items on Financial Statements. The pronouncement does not change the accounting treatment for derivative instruments.

 

Variable Interest Entities and Transfers of Financial Assets and Extinguishments of Liabilities — The pronouncement on transfers of financial assets and extinguishments of liabilities removes the concept of a qualifying special-purpose entity and removes the exception from applying variable interest entity accounting to qualifying special-purpose entities. The new guidance on variable interest entities requires an entity to perform an ongoing analysis to determine whether the entity’s variable interest or interests give it a controlling financial interest in a variable interest entity. The pronouncements are effective for fiscal years beginning after November 15, 2009.

 

Management does not anticipate that the adoption of these standards will have a material impact on the financial statements.

Comprehensive Income

The company’s comprehensive income is comprised of net income, unrealized gains and losses on marketable securities classified foreign currency translation adjustments, and unrealized gains and losses on derivative financial instruments related to foreign currency hedging.

XML 28 R11.htm IDEA: XBRL DOCUMENT v2.4.0.6
Note E. GOING CONCERN
12 Months Ended
Dec. 31, 2012
Notes to Financial Statements  
Note E. GOING CONCERN

The Company’s customer concentration may raise doubt about its ability to continue as a going concern. The financial statements do not include adjustments that might result from the outcome of this uncertainty and if the Company is unable to generate significant revenue or secure financing, then the Company may be required to cease or curtail its operations.  In year 2012, the Company generated sales revenue of $16,007,275. The Company’s significant customers are Electrolux and its subsidiaries located in various countries.  Electrolux and its subsidiaries are operated independently in various countries, the management assess that it is unlikely if Electrolux and its subsidiary discontinue the purchase in near future due to the Company secured a purchase order in next three years with Electrolux and its subsidiaries. Because of the concentration of the customer and supplier base and Company’s heavily reliance on the Electrolux and its subsidiaries, Company may face the difficulty as going concern. However, the going concern may be mitigated due to the close relationship between the Company and it’s suppliers, Zhong Nan Fu Rui and Chuzhou Fuda Mechanical & Electronics Co., Ltd , which are 100% owned by the founder, Jianfeng Ding. Zhong Nan Fu Rui and Chuzhou Fuda Mechanical & Electronics Co., Ltd.’s current customers can be served by the Company for the same quality of products and services.  Besides, as of December 31, 2012, the cash and cash equivalent balance was $194,265, the management believes that the revenues will be generated and its cash flows will be maintained to cover its operational costs and the risk of going concern in long term is significantly low. 

 

Exhibit A

 

    Year Ended     Year Ended  
    December 31,     December 31,  
    2012     2011  
                 
Administration Expense     1,681       2,071  
Bad Debt Expense     -       5,895  
Bank Service Charges     58,182       4,449  
Business Registration     904       1,513  
Certification Fee     66,654       73,832  
Computer and Internet Expenses     1,317       1,100  
Credit card Finance Charge     218       60  
Depreciation and amortization expenses     20,957       14,965  
Fuel charge     3,049       883  
Gift and Promotion     9,504       5,048  
Insurance Expense     945       945  
Meals and Entertainment     19,822       14,293  
Office Supplies     8,262       12,920  
Parking fee     864       376  
Payroll Expense - ER     38,835       33,452  
Payroll Expenses - EE     674,705       585,978  
Penalty & Fine Expenses     -       218  
Postage & Shipping     8,154       6,035  
Professional Fees     125,781       95,009  
Rent Expense     52,687       52,075  
Repairs and Maintenance     3,118       6,104  
Research and development Expense     17,311       15,191  
Service Cost     340       4,406  
Telephone Expense     9,891       9,284  
Travel Expense                
air agent fee     2,008       789  
Airfare     42,425       58,332  
Car Rental     5,687       3,872  
Hotel Expense     29,377       27,954  
Local Transportation     590       1,511  
Travel Expense - Other     -       1,134  
Total Travel Expense     80,087       93,592  
Utilities     2,401       1,142  
Total Expense   $ 1,205,671     $ 1,040,836  
XML 29 R23.htm IDEA: XBRL DOCUMENT v2.4.0.6
GOING CONCERN (Details Narrative) (USD $)
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Going Concern Details Narrative    
Revenue $ 16,007,275 $ 13,780,374
Cash and cash equivalent $ 194,265 $ 741,230
XML 30 R19.htm IDEA: XBRL DOCUMENT v2.4.0.6
RELATED PARTY TRANSACTIONS (Details) (USD $)
Dec. 31, 2012
Related Parties details  
Shares 29,277,760
Amount $ 550,498
Percentage 74.71%
Fenglan Li [Member]
 
Related Parties details  
Shares 165,000
Amount 15,750
Percentage 0.42%
Fuling Li [Member]
 
Related Parties details  
Shares 115,000
Amount 10,750
Percentage 0.29%
Ying Zhong [Member]
 
Related Parties details  
Shares 2,000,000
Amount 200,000
Percentage 5.10%
Jianfeng Ding and Yaru Huang [Member]
 
Related Parties details  
Shares 26,997,760
Amount $ 323,998
Percentage 68.89%
XML 31 R15.htm IDEA: XBRL DOCUMENT v2.4.0.6
GOING CONCERN (Tables)
12 Months Ended
Dec. 31, 2012
Going Concern Tables  
GOING CONCERN

Exhibit A

 

    Year Ended     Year Ended  
    December 31,     December 31,  
    2012     2011  
                 
Administration Expense     1,681       2,071  
Bad Debt Expense     -       5,895  
Bank Service Charges     58,182       4,449  
Business Registration     904       1,513  
Certification Fee     66,654       73,832  
Computer and Internet Expenses     1,317       1,100  
Credit card Finance Charge     218       60  
Depreciation and amortization expenses     20,957       14,965  
Fuel charge     3,049       883  
Gift and Promotion     9,504       5,048  
Insurance Expense     945       945  
Meals and Entertainment     19,822       14,293  
Office Supplies     8,262       12,920  
Parking fee     864       376  
Payroll Expense - ER     38,835       33,452  
Payroll Expenses - EE     674,705       585,978  
Penalty & Fine Expenses     -       218  
Postage & Shipping     8,154       6,035  
Professional Fees     125,781       95,009  
Rent Expense     52,687       52,075  
Repairs and Maintenance     3,118       6,104  
Research and development Expense     17,311       15,191  
Service Cost     340       4,406  
Telephone Expense     9,891       9,284  
Travel Expense                
Air Agent Fee     2,008       789  
Airfare     42,425       58,332  
Car Rental     5,687       3,872  
Hotel Expense     29,377       27,954  
Local Transportation     590       1,511  
Travel Expense - Other     -       1,134  
Total Travel Expense     80,087       93,592  
Utilities     2,401       1,142  
Total Expense   $ 1,205,671     $ 1,040,836  

XML 32 R13.htm IDEA: XBRL DOCUMENT v2.4.0.6
SIGNIFICANT ACCOUNTING POLICIES (Tables)
12 Months Ended
Dec. 31, 2012
Notes to Financial Statements  
Account Receivable from major customers

As of December 31, 2012, and 2011, the company had a total of $1,558,282 and $766,318 account receivable respectively from it major customers. Detail showed as below.

 

    12/31/2012      12/31/2011  
                 
Chuzhou FuDa   $ 140,892     $ -  
All other account receivable   $ 569     $ 7,800  
Electrolux- Australia   $ 222,579     $ 198,147  
Electrolux-Anderson-US   $ 25,388     $ -  
Electrolux-Mexico   $ 38,418     $ -  
Eelectrolux Major Appliance   $ -     $ 72,828  
Electrolux - Sweden   $ 5,442     $ -  
Electrolux Italy   $ 235,712     $ 24,550  
Electrolux Hungary   $ 342,987     $ 114,230  
General Electric Company   $ -     $ 17,683  
Electrolux ST.Cloud   $ 8,484     $ 81,596  
Stanco Metal Products Inc   $ 22,723     $ -  
Master Precidion Global LLC(MPG)   $ -     $ 75,455  
Sigma Refrigeration Ltd   $ 150,420     $    
Qingdao Fubida   $ 364,669     $ -  
ZhongNanFuRui   $ -     $ 174,030  
TOTAL   $ 1,558,282     $ 766,318  

Payroll expenses

The total payroll expenses for the year ended December 31, 2012 and 2011 were listed as follows:

 

    Year Ended     Year Ended  
    December 31,     December 31,  
    2012     2011  
Payroll Expense - ER            
Federal Unemployment Tax     546.00       584.89  
State Unemployment Tax     1,045.08       3,184.66  
US Medicare Tax - ER     9,812.09       8,496.89  
US Social Security Tax -ER     27,081.33       20,953.17  
Payroll Expense - ER - Other     350.87       232.46  
Total Payroll Expense - ER     38,835.37       33,452.07  
Payroll Expenses - EE                
Federal Tax Withholding     123,083.84       106,358.47  
State Tax Withholding     42,303.56       32,316.65  
US Medicare Tax -EE     9,812.07       8,496.89  
US Net Salaries payment - EE     481,160.36       424,108.86  
US Social Security Tax - EE     18,345.43       14,697.27  
Total Payroll Expenses - EE     674,705.26       585,978.14  
                 
Total Payroll Expenses     713,540.63       619,430.21  

XML 33 R14.htm IDEA: XBRL DOCUMENT v2.4.0.6
RELATED PARTY TRANSACTIONS (Tables)
12 Months Ended
Dec. 31, 2012
Notes to Financial Statements  
Related Parties details

As of December 31, 2012, total 29,277,760 shares were issued to officers and directors.  Please see the table below for details:

 

Name   Total Shares     Total Amount     Percentage  
                   
Fenglan  Li     165,000       15,750       0.42 %
Fuling Li     115,000       10,750       0.29 %
Ying Zhong     2,000,000       200,000       5.10 %
Jianfeng Ding & Yaru Huang     26,997,760       323,998       68.89 %
    Total     29,277,760     $ 550,498       74.71 %

 

XML 34 R16.htm IDEA: XBRL DOCUMENT v2.4.0.6
SIGNIFICANT ACCOUNTING POLICIES (Details) (USD $)
Dec. 31, 2012
Dec. 31, 2011
Account receivable from major customers    
Account Receivable $ 1,558,282 $ 766,318
Chuzhou FuDa [Member]
   
Account receivable from major customers    
Account Receivable 140,892   
All Other Account Receivable [Member]
   
Account receivable from major customers    
Account Receivable 569 7,800
Electrolux Australia [Member]
   
Account receivable from major customers    
Account Receivable 222,579 198,147
Electrolux Anderson US [Member]
   
Account receivable from major customers    
Account Receivable 25,388   
Electrolux Mexico [Member]
   
Account receivable from major customers    
Account Receivable 38,418   
Electrolux Major Appliance [Member]
   
Account receivable from major customers    
Account Receivable    72,828
Electrolux Sweden [Member]
   
Account receivable from major customers    
Account Receivable 5,442   
Electrolux Italy [Member]
   
Account receivable from major customers    
Account Receivable 235,712 24,550
Electrolux Hungary [Member]
   
Account receivable from major customers    
Account Receivable 342,987 114,230
General Electric Company [Member]
   
Account receivable from major customers    
Account Receivable    17,683
Electrolux St Cloud [Member]
   
Account receivable from major customers    
Account Receivable 8,484 81,596
Stanco Metal Products Inc [Member]
   
Account receivable from major customers    
Account Receivable 22,723   
Master Precidion Global LLC(MPG) [Member]
   
Account receivable from major customers    
Account Receivable    75,455
Sigma Rrfrigeration Ltd [Member]
   
Account receivable from major customers    
Account Receivable 150,420  
Qingdao Fubida [Member]
   
Account receivable from major customers    
Account Receivable 364,669   
Zhong Nan Fu Rui [Member]
   
Account receivable from major customers    
Account Receivable    $ 174,030
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SHAREHOLDERS' EQUITY (Details Narrative)
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2009
Shareholders' equity details      
Shares issued 39,290,827 38,990,827 38,990,827
Shares outstanding 39,290,827 38,990,827 38,990,827
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CONSOLIDATED STATEMENT OF STOCKHOLDERS EQUITY (USD $)
Common Stock
Additional Paid-In Capital
Retained Earnings / Accumulated Deficit
Accumulated Other Comprehensive
Total
Beginning Balance, Amount at Dec. 31, 2009 $ 38,991 $ 1,221,613 $ (23,633) $ 48,979 $ 1,285,950
Beginning Balance, Shares at Dec. 31, 2009 38,990,827        
Adjustment for Exchange rate changes          (43,456) (43,456)
Net Income       211,205    211,205
Ending Balance, Amount at Dec. 31, 2010 38,991 1,221,613 187,572 5,523 1,453,699
Ending Balance, Shares at Dec. 31, 2010 38,990,827        
Adjustment for Exchange rate changes          5,542 5,542
Net Income       200,501    200,501
Ending Balance, Amount at Dec. 31, 2011 38,991 1,221,613 388,073 11,065 1,659,742
Ending Balance, Shares at Dec. 31, 2011 38,990,827        
Adjustment for Exchange rate changes          (11,242) (11,242)
Issuance of common stocks to Williams@ 0.10 per share on November 1, 2012, Amount 300 29,700       30,000
Issuance of common stocks to Williams@ 0.10 per share on November 1, 2012, Shares 300,000        
Net Income       155,091    155,091
Ending Balance, Amount at Dec. 31, 2012 $ 39,291 $ 1,251,313 $ 543,164 $ (177) $ 1,833,591
Ending Balance, Shares at Dec. 31, 2012 39,290,827        
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Note D. SHAREHOLDERS' EQUITY
12 Months Ended
Dec. 31, 2012
Notes to Financial Statements  
Note D. SHAREHOLDERS' EQUITY

During the year ended December 31, 2008, Flurida Group, Inc has issued total 11,699,067 new shares on April 15, 2008, including 11,649,067 shares issued to loan holders who converted all the loans to common shares. At the year ended December 31, 2008, Flurida Group, Inc. incurred net loss of $(194,079).

 

Therefore, the total stockholders’ equity balance at December 31, 2008 was $1,075,377.

 

On April 15, 2008, 50,000 shares issued to Williams Law Group at $ 0.10, for the legal service value of $5,000. On April 1, 2008, seven non-affiliated loan holders asked for repayment of their loans in the aggregate amount of $25,066 plus the total interest cost of $624.72, which was paid on the same date, April 1, 2008; meantime, seven additional lenders loaned an aggregate amount of $9,926.

 

On April 15, 2008, total loan amount of $1,164,906 was converted to common shares at price of $0.10 per share, for the total shares of 11,649,067 shares, which were issued to the loans holders.

 

There were no new shares issued during the period ending December 31, 2009, 2010, and 2011.

 

On November 1, 2012, 300,000 shares were issued to Williams Law Group at $ 0.10, for the legal service value of $30,000.

 

Therefore, as of December 31, 2012 total shares issued and outstanding are 39,290,827.

 

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RELATED PARTY TRANSACTIONS (Details Narrative) (USD $)
12 Months Ended
Dec. 31, 2012
Dec. 31, 2011
Dec. 31, 2009
Related Party transactions additional details      
Shares issued to officers and directors 29,277,760    
Inventory at period end $ 2,278,467 $ 1,803,675  
Cost of purchasing parts 852,521    
Purchase during period 15,111,387    
Total cost of good sold 14,547,943 12,400,149  
Freight cost 22,868    
Other cost 4,439    
Purchase return and discount 115,959    
Shares outstanding 39,290,827 38,990,827 38,990,827
Shares issued 39,290,827 38,990,827 38,990,827
Total outstanding issued shares 39,290,827    
Zhong Nan Fu Rui [Member]
     
Related Party transactions additional details      
Cost of purchasing parts $ 1,515,914