0001493152-19-011321.txt : 20190730 0001493152-19-011321.hdr.sgml : 20190730 20190730110226 ACCESSION NUMBER: 0001493152-19-011321 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 42 CONFORMED PERIOD OF REPORT: 20190630 FILED AS OF DATE: 20190730 DATE AS OF CHANGE: 20190730 FILER: COMPANY DATA: COMPANY CONFORMED NAME: United Royale Holdings Corp. CENTRAL INDEX KEY: 0001652842 STANDARD INDUSTRIAL CLASSIFICATION: AGRICULTURE PRODUCTION - CROPS [0100] IRS NUMBER: 981253258 STATE OF INCORPORATION: NV FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 333-208978 FILM NUMBER: 19983738 BUSINESS ADDRESS: STREET 1: UNIT ROOM 8F, WORLD TRUST TOWER BUILDING STREET 2: 50 STANLEY STREET CITY: CENTRAL STATE: K3 ZIP: 000000 BUSINESS PHONE: 852-36102665 MAIL ADDRESS: STREET 1: UNIT ROOM 8F, WORLD TRUST TOWER BUILDING STREET 2: 50 STANLEY STREET CITY: CENTRAL STATE: K3 ZIP: 000000 FORMER COMPANY: FORMER CONFORMED NAME: Bosy Holdings Corp. DATE OF NAME CHANGE: 20150910 10-Q 1 form10-q.htm

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For The Quarterly Period Ended June 30, 2019

 

or

 

[  ] 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 333-208978

 

United Royale Holdings Corp.

(Exact name of registrant issuer as specified in its charter)

 

Nevada   98-1253258
(State or other jurisdiction of
incorporation or organization)
 

(I.R.S. Employer

Identification No.)

 

Unit Room 8F, World Trust Tower Building,

50 Stanley Street, Central, Hong Kong

(Address of principal executive offices, including zip code)

 

Registrant’s phone number, including area code (852) 3610-2665

 

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 [  ]

 

Indicate by check mark whether the registrant has submitted electronically, every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (section 232.405 of this chapter) during the preceding twelve months (or shorter period that the registrant was required to submit such files).

 

YES [  ] NO [X]

 

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 [  ] Accelerated Filer [  ] Non-accelerated Filer [  ] Smaller reporting company [X]
      Emerging growth company [X]

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act [  ]

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [  ] No [X]

 

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

 

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.

 

Yes [  ] No [  ]

 

APPLICABLE ONLY TO CORPORATE ISSUERS:

 

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

 

Class   Outstanding at July 30, 2019
Common Stock, $.0001 par value   141,965,520

 

 

 

   
 

 

TABLE OF CONTENTS

 

    Page
PART I FINANCIAL INFORMATION  
     
ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS:  
     
  Condensed Consolidated Balance Sheets as of June 30, 2019 (unaudited) and December 31, 2018 F-1
     
  Condensed Consolidated Statements of Operations and Comprehensive Loss for the Three Months and Six Months Ended June 30, 2019 and 2018 (unaudited) F-2
     
  Condensed Consolidated Statements of Changes in Stockholders’ Equity for the Six Months Ended June 30, 2019 and 2018 (unaudited) F-3
     
  Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2019 and 2018 (unaudited) F-4
     
  Notes to the Condensed Consolidated Financial Statements (unaudited) F-5 – F-10
     
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 3-4
     
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 5
     
ITEM 4. CONTROLS AND PROCEDURES 5
     
PART II OTHER INFORMATION  
     
ITEM 1 LEGAL PROCEEDINGS 6
     
ITEM 2 UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS 6
     
ITEM 3 DEFAULTS UPON SENIOR SECURITIES 6
     
ITEM 4 MINE SAFETY DISCLOSURES 6
     
ITEM 5 OTHER INFORMATION 6
     
ITEM 6 EXHIBITS 6
     
SIGNATURES 7

 

 -2- 
 

 

PART I — FINANCIAL INFORMATION

 

ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

UNITED ROYALE HOLDINGS CORP.

CONDENSED CONSOLIDATED BALANCE SHEETS

AS OF JUNE 30, 2019 AND DECEMBER 31, 2018

(Currency expressed in United States Dollars (“US$”), except for number of share)

 

  

As of

June 30, 2019

  

As of

December 31, 2018

 
    (Unaudited)      
ASSETS          
CURRENT ASSETS          
Cash and cash equivalents (Nil at June 30, 2019; including $6,394 of restricted cash at December 31, 2018)  $129,021   $261,930 
Prepaid expenses   14,988    13,931 
TOTAL CURRENT ASSETS  $144,009   $275,861 
           
NON-CURRENT ASSETS          
Plant and equipment, net   2,729    3,468 
Biological assets   35,510    28,697 
TOTAL ASSETS  $182,248   $308,026 
           
LIABILITIES AND STOCKHOLDERS’ EQUITY          
CURRENT LIABILITIES          
Accrued liabilities  $6,718   $27,790 
Due to director   78,424    66,355 
TOTAL CURRENT LIABILITIES  $85,142   $94,145 
TOTAL LIABILITIES  $85,142   $94,145 
           
STOCKHOLDERS’ EQUITY          
Preferred stock – Par value $0.0001; Authorized: 200,000,000 None issued and outstanding   -    - 
Common stock – Par value $ 0.0001; Authorized: 600,000,000 Issued and outstanding: 141,965,520 shares as of June 30, 2019 and December 31, 2018   14,197    14,197 
Additional paid-in capital   650,712    650,712 
Accumulated other comprehensive loss   (489)   (460)
Accumulated deficit   (567,314)   (450,568)
TOTAL STOCKHOLDERS’ EQUITY   97,106    213,881 
           
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY  $182,248   $308,026 

 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

 F-1 
 

 

UNITED ROYALE HOLDINGS CORP.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

AND COMPREHENSIVE LOSS

FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2019 AND 2018

(Currency expressed in United States Dollars (“US$”), except for number of shares)

 

(Unaudited)

 

   Three Months Ended
June 30,
   Six Months Ended
June 30,
 
   2019   2018 (1)   2019   2018 (1) 
REVENUE  $-    -   $-    - 
                     
COST OF REVENUE  $-    -   $-    - 
                     
GROSS PROFIT  $-    -   $-    - 
                     
OPERATING EXPENSES:                    
General and administrative  $(66,906)   (30,745)  $(117,093)   (75,289)
                     
LOSS FROM OPERATIONS  $(66,906)   (30,745)  $(117,093)   (75,289)
                     
OTHER EXPENSE                    
Other income (expense), net   347    96    347    60 
                     
LOSS BEFORE INCOME TAX   (66,559)   (30,649)   (116,746)   (75,229)
                     
INCOME TAX EXPENSE   -    -    -    - 
                     
NET LOSS  $(66,559)   (30,649)  $(116,746)   (75,229)
                     
Other comprehensive loss:                    
- Foreign currency translation income (loss)   90    663    (29)   (33)
COMPREHENSIVE LOSS   (66,469)   (29,986)   (116,775)   (75,262)
                     
NET LOSS PER SHARE, BASIC AND DILUTED  $(0.00)   (0.00)  $(0.00)   (0.00)
                     
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING, BASIC AND DILUTED   141,965,520    141,965,520    141,965,520    141,965,520 

 

(1) The prior year comparative information has been retrospectively stated due to the common control acquisition on September 30, 2018.

 

See accompanying notes to the unaudited condensed consolidated financial statements.

 

 F-2 
 

 

UNITED ROYALE HOLDINGS CORP.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

FOR SIX MONTHS ENDED JUNE 30, 2019 AND 2018

(Currency expressed in United States Dollars (“US$”), except for number of shares)

 

Six months ended June 30, 2019 (Unaudited)

 

   COMMON STOCK   ADDITIONAL   ACCUMULATED
OTHER
       TOTAL 
   Number of
Shares
   Amount   PAID-IN
CAPITAL
   COMPREHENSIVE
LOSS
   ACCUMULATED DEFICIT   STOCKHOLDERS’ EQUITY 
Balance as of December 31, 2018 (audited)   141,965,520   $14,197   $650,712   $(460)  $(450,568)  $213,881 
Net loss   -    -    -    -    (50,187)   (50,187)
Foreign currency translation   -    -    -    (119)   -    (119)
Balance as of March 31, 2019 (Unaudited)   141,965,520   $14,197   $650,712   $(579)  $(500,755)  $163,575 
Net loss   -    -    -    -    (66,559)   (66,559)
Foreign currency translation   -    -    -    90    -    90 
Balance as of June 30, 2019 (Unaudited)   141,965,520   $14,197   $650,712   $(489)  $(567,314)  $97,106 

 

Six months ended June 30, 2018 (Unaudited)

 

   COMMON STOCK   ADDITIONAL   ACCUMULATED
OTHER
       TOTAL 
   Number of
Shares
   Amount   PAID-IN
CAPITAL
   COMPREHENSIVE
LOSS
   ACCUMULATED
DEFICIT
   STOCKHOLDERS’ EQUITY 
Balance as of December 31, 2017 (audited)   141,965,520   $14,197   $643,448   $(739)  $(252,091)  $404,815 
Net loss   -    -    -    -    (44,580)   (44,580)
Foreign currency translation   -    -    -    (696)   -    (696)
Balance as of March 31, 2018 (unaudited) (1)   141,965,520   $14,197   $643,448   $(1,435)  $(296,671)   359,539 
Net loss   -    -    -    -    (30,649)   (30,649)
Foreign currency translation   -    -    -    663    -    663 
Balance as of June 30, 2018 (unaudited) (1)   141,965,520   $14,197   $643,448   $(772)  $(327,320)  $329,553 

 

(1) The prior year comparative information has been retrospectively stated due to the common control acquisition on September 30, 2018.

 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

 F-3 
 

 

UNITED ROYALE HOLDINGS CORP.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE SIX MONTHS ENDED JUNE 30, 2019 AND 2018

(Currency expressed in United States Dollars (“US$”), except for number of shares)

 

  

For the six

months ended

June 30, 2019

  

For the six

months ended

June 30, 2018 (1)

 
    (Unaudited)    (Unaudited) 
CASH FLOWS FROM OPERATING ACTIVITIES:          
Net loss  $(116,746)  $(75,229)
Adjustments to reconcile net loss to net cash used in operating activities          
Depreciation expenses   738    742 
Changes in operating assets and liabilities:          
Decrease in accrued liabilities   (21,067)   (9,000)
Increase in prepaid expenses   (1,057)   (4,850)
Net cash flows used in operating activities   (138,132)   (88,337)
           
CASH FLOWS USED IN INVESTING ACTIVITIES:          
Additional of accumulation cost of biological assets   (6,866)   (7,173)
Net cash flows used in investing activities   (6,866)   (7,173)
           
CASH FLOWS FROM FINANCING ACTIVITIES          
Advance from directors   12,148    27,157 
Net cash provided by financing activities   12,148    27,157 
           
Effect of exchange rate changes in cash and cash equivalents   (60)   (490)
           
Net changes in cash and cash equivalents   (132,910)   (68,843)
Cash and cash equivalents, beginning of period   261,930    448,684 
           
CASH AND CASH EQUIVALENTS, END OF YEAR/PERIOD  $129,020   $379,841 
           
SUPPLEMENTAL CASH FLOWS INFORMATION          
Income taxes paid  $-   $- 
Interest paid  $-   $- 

 

(1) The prior year comparative information has been retrospectively stated due to the common control acquisition on September 30, 2018.

 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

 F-4 
 

 

UNITED ROYALE HOLDINGS CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED JUNE 30, 2019 (UNAUDITED)AND DECEMBER 31, 2018

(Currency expressed in United States Dollars (“US$”), except for number of shares)

 

1. BASIS OF PRESENTATION

 

The accompanying unaudited condensed consolidated financial statements have been prepared by management in accordance with both accounting principles generally accepted in the United States (“GAAP”), and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Certain information and note disclosures normally included in audited financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to those rules and regulations, although the Company believes that the disclosures made are adequate to make the information not misleading.

 

In the opinion of management, the balance sheet as of June 30, 2019 which has been derived from unaudited financial statements and these unaudited condensed consolidated financial statements reflect all normal and recurring adjustments considered necessary to state fairly the results for the periods presented. The results for the period ended June 30, 2019 are not necessarily indicative of the results to be expected for the entire fiscal year ending December 31, 2019 or for any future period.

 

These unaudited condensed consolidated financial statements and notes thereto should be read in conjunction with the Management’s Discussion and the audited financial statements and notes thereto included in the Form 10-K for the year ended December 31, 2018.

 

2. DESCRIPTION OF BUSINESS AND ORGANIZATION

 

United Royale Holdings Corp., formerly known as Bosy Holdings Corp. (“the Company”, “we”, “us” or “our”) was incorporated in the State of Nevada on June 23, 2015. We intend to offer planting and cultivation services to land owners in regards to the planting and cultivation of Aquilaria Subintegra & Aquilaria Sinensis trees. We also intend to provide services relating to the extraction of Agarwood from such trees through a process known as “inoculation.”

 

On September 30, 2018, the Company and Mr. CHEN Zheru, representing the sole shareholder of IV Enterprises Development Limited, a Seychelles corporation (“IVED”), entered into a Sale and Purchase Agreement, pursuant to which the Company acquired 100% (one hundred percent) of the shareholding of IVED. IVED provides tree nurseries, including planting, cultivation and inoculation services through its wholly-owned subsidiary, Oudh Tech Sdn Bhd, in Malaysia. The acquisition is completed on September 30, 2018.

 

Mr. CHEN Zheru is the common director and major shareholder of the Company and IVED. As a result of this common ownership and in accordance with the FASB Accounting Standards Codification Section 805 “Business Combination”, the transaction is being treated as a combination between entities under common control. The recognized assets and liabilities were transferred at their carrying amounts at the date of the transaction. The equity accounts of the combining entities are combined. Further, the companies will be combined retrospectively for prior year comparative information as if the transaction had occurred on January 1, 2017.

 

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Basis of presentation

 

The accompanying financial statements are prepared in accordance with generally accepted accounting principles in the United States of America (“US GAAP”).

 

The accompanying financial statements include the accounts of the Company and its wholly-owned subsidiaries. Intercompany transactions and balances were eliminated in consolidation.

 

 F-5 
 

 

Below is the organization chart of the Group.

 

https:||www.sec.gov|Archives|edgar|data|1652842|000149315218016437|image_001.jpg

 

Use of estimates

 

Management uses estimates and assumptions in preparing these financial statements in accordance with US GAAP. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities in the balance sheet, and the reported revenue and expenses during the periods reported. Actual results may differ from these estimates.

 

Going Concern

 

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. During the six months ended June 30, 2019, the Company incurred a net loss of $116,746 and used cash in operations of $138,132. These factors raise substantial doubt about the Company’s ability to continue as a going concern within one year of the date that the financial statements are issued. In addition, the Company’s independent registered public accounting firm, in its report on the Company’s December 31, 2018 financial statements, has expressed substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

 

The Company’s ability to continue as a going concern is dependent upon improving its profitability and the continuing financial support from its shareholders. Management believes the existing shareholders or external financing will provide the additional cash to meet the Company’s obligations as they become due. Despite the amount of funds that we have raised, no assurance can be given that any future financing, if needed, will be available or, if available, that it will be on terms that are satisfactory to the Company. Even if the Company is able to obtain additional financing, if needed, it may contain undue restrictions on its operations, in the case of debt financing, or cause substantial dilution for its stockholders, in the case of equity financing.

 

Cash and cash equivalents

 

Cash and cash equivalents are carried at cost and represent cash on hand, demand deposits placed with banks or other financial institutions and all highly liquid investments with an original maturity of three months or less as of the purchase date of such investments. Restricted cash represents cash restricted by Hang Seng Bank as the bank account was forced to close on October 5, 2018, and this amount of cash was held by Hang Seng Bank. The reason for forced closure was a long period dormant without account activity. On February 25, 2019, our management went to Hang Seng Bank in person to withdraw the money and deposited in HSBC Hong Kong respectively.

 

Our deposit is currently deposit in HSBC Hong Kong, and there is a Deposit Protection Scheme protects our eligible deposits held with bank in Hong Kong which is members of the Scheme. The scheme will pay us a compensation up to a limit of HKD500,000, which is equivalent to $64,102, if HSBC Hong Kong fails.

 

 F-6 
 

 

Plant and equipment

 

Plant and equipment are stated at cost less accumulated depreciation and impairment. Depreciation of plant, equipment and software are calculated on the straight-line method over their estimated useful lives or lease terms generally as follows:

 

Classification   Useful Life
Computer and Software   3 years
Equipment   10 years

 

The Company purchased 2 computers at the end of June 2017, and the computers has been subject to depreciation since the utilization in July 2017. Expenditures for maintenance and repairs will be expensed as incurred.

 

Biological Assets

 

Biological Assets of the Company comprise of agarwood sapling and plantation cost of agarwood.

 

Pursuant to ASC 905-360-25-2, biological Assets are planted and brought to production by the Company or on a contract basis. Saplings are usually purchased as nursery stock and transplanted into the farmland in the desired pattern. Cost of biological assets consists of accumulated planation development costs incurred from commencement of planting of seedlings up to maturity of the crop cultivated. Capitalization of planation development and other operating costs ceases upon commencement of commercial harvesting, which range from 7 to 9 years. Net proceeds from sales of products before commercial production begins shall be applied to the capitalized cost of the plants, trees, or vines.

 

Biological Assets is measured using average cost, and is measured at the lower of cost and net realizable value. When evidence exists that the net realizable value of biological Assets is lower than its cost, the difference shall be recognized as a loss in earnings in the period in which it occurs. Impairment loss may be required, for example, due to damage, physical deterioration, obsolescence, changes in price levels, or other causes.

 

Pursuant to ASC 905-360-35-4, when production in commercial quantities begins, the accumulated costs shall be depreciated over the estimated useful life of the particular farmland.

 

Foreign currencies translation

 

Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the statement of operations.

 

The reporting currency of the Company is the United States Dollars (“US$”) and the accompanying financial statements have been expressed in US$. Hong Kong Dollars (“HK$”), which is the respective functional currencies for the Company as the deposit is currently kept in HSBC Hong Kong. In addition, the Company’s subsidiaries maintain their books and records in their respective local currency, which consists of the Hong Kong Dollars (“HK$”) and Malaysian Ringgit (“MYR”), which is also the respective functional currency of the subsidiaries.

 

Translation of amounts from the local currencies of the Company into US$ has been made at the following exchange rates for the respective periods:

 

   As of and for the six months ended
June 30,
 
   2019
(Unaudited)
   2018
(Unaudited)
 
Period-end MYR : US$1 exchange rate   4.13    4.04 
Period-average MYR : US$1 exchange rate   4.11    3.94 
Period-end / average HK$ : US$1 exchange rate   7.75    7.75 

 

 F-7 
 

 

Revenue recognition

 

In accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 606, “Revenue From Contracts With Customers”, the Company recognizes revenue from sales of goods and services when the following five following steps are carried out: (1) Identify the contract; (2) Identify the performance obligations; (3) Determine the transaction price; (4) Allocate the transaction price; (5) Recognize revenue. For the six months ended June 30, 2019, the Company had no revenue recorded, as a result, there was no effect on revenue by adopting ASC 606 starting from January 1, 2018.

 

Income taxes

 

The Company accounts for income taxes using the asset and liability method. The asset and liability method requires recognition of deferred tax assets and liabilities for expected future tax consequences of temporary differences that currently exist between tax bases and financial reporting bases of the Company’s assets and liabilities. Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which these temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is provided on deferred taxes if it is determined that it is more likely than not that the asset will not be realized. The Company recognizes penalties and interest accrued related to income tax liabilities in the provision for income taxes in its Consolidated Statements of Income.

 

Significant management judgment is required to determine the amount of benefit to be recognized in relation to an uncertain tax position. The Company uses a two-step process to evaluate tax positions. The first step requires an entity to determine whether it is more likely than not (greater than 50% chance) that the tax position will be sustained. The second step requires an entity to recognize in the financial statements the benefit of a tax position that meets the more-likely-than-not recognition criterion. The amounts ultimately paid upon resolution of issues raised by taxing authorities may differ materially from the amounts accrued and may materially impact the financial statements of the Company in future periods.

 

 F-8 
 

 

Fair value of financial instruments

 

The carrying value of the Company’s financial instruments: cash and cash equivalents, prepayments, amount due to a director and accrued liabilities approximate at their fair values because of the short-term nature of these financial instruments.

 

The Company follows the guidance of the ASC Topic 820-10, “Fair Value Measurements and Disclosures” (“ASC 820-10”), with respect to financial assets and liabilities that are measured at fair value. ASC 820-10 establishes a three-tier fair value hierarchy that prioritizes the inputs used in measuring fair value as follows:

 

● Level 1 : Observable inputs such as quoted prices in active markets;

 

● Level 2 : Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and

 

● Level 3 : Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions

 

Recent accounting pronouncements

 

In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606) (ASU 2014-09), which amends the existing accounting standards for revenue recognition. In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date, which delays the effective date of ASU 2014-09 by one year. The FASB also agreed to allow entities to choose to adopt the standard as of the original effective date. In March 2016, the FASB issued Accounting Standards Update No. 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net) (ASU 2016-08) which clarifies the implementation guidance on principal versus agent considerations. The guidance includes indicators to assist an entity in determining whether it controls a specified good or service before it is transferred to the customers. The new standard further requires new disclosures about contracts with customers, including the significant judgments the company has made when applying the guidance. We adopted the new standard effective January 1, 2018, using the modified retrospective transition method. We finalized our analysis and the adoption of this guidance will not have a material impact on our consolidated financial statements and our internal controls over financial reporting.

 

In November 2016, the FASB issued Accounting Standards Update No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash (ASU 2016-18), which requires companies to include amounts generally described as restricted cash and restricted cash equivalents in cash and cash equivalents when reconciling beginning-of-period and end-of-period total amounts shown on the statement of cash flows. We adopted the new standard effective January 1, 2018, and do not expect the standard to have a material impact on our financial statements.

 

 F-9 
 

 

In January 2017, the FASB issued Accounting Standards Update No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business (ASU 2017-01), which revises the definition of a business and provides new guidance in evaluating when a set of transferred assets and activities is a business. We adopted the new standard effective January 1, 2018 on a prospective basis. The new standard did not have a material impact on our consolidated financial statements.

 

In February 2016, the FASB issued Accounting Standards Update No. 2016-02, Leases (Topic 842) (ASU 2016-02), as amended, which generally requires lessees to recognize operating and financing lease liabilities and corresponding right-of-use assets on the balance sheet and to provide enhanced disclosures surrounding the amount, timing and uncertainty of cash flows arising from leasing arrangements. We will adopt the new standard effective January 1, 2019 on a modified retrospective basis and will not restate comparative periods. We will elect the package of practical expedients permitted under the transition guidance, which allows us to carryforward our historical lease classification, our assessment on whether a contract is or contains a lease, and our initial direct costs for any leases that exist prior to adoption of the new standard. We will also elect to combine lease and non-lease components and to keep leases with an initial term of 12 months or less off the balance sheet and recognize the associated lease payments in the consolidated statements of income on a straight-line basis over the lease term. We do not expect the new standard to have a material impact on our remaining consolidated financial statements.

 

The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and do not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations.

 

4. PREPAID EXPENSES

 

The prepaid expenses as of June 30, 2019 included OTCQB annual fee of $6,000, deposit of $1,852 in transfer agent, deposit of $6,410 in the consulting service provider and $726 in our farmland provider, while the prepaid expenses as of December 31, 2018 included OTCQB annual fee of $12,000, deposit of $1,205 in the transfer agent and deposit of $726 in our farmland provider.

 

5. PLANT AND EQUIPMENT, NET

 

   As of
June 30, 2019
   As of
December 31, 2018
 
   (Unaudited)     
Computer and Software  $3,878   $3,878 
Equipment   1,815    1,816 
    5,693    5,694 
Less: Accumulated Depreciation   (2,964)   (2,226)
Plant and equipment, net  $2,729   $3,468 

 

The Company acquired computers and a software at $3,731 and $147 respectively in 2017, and the accumulated depreciations as of June 30, 2019 and December 31, 2018 were $2,585 and $1,939 respectively.

 

The Company acquired Engine Pump at MYR7,500 (approximately $1,852) in 2017. The accumulated depreciations as of June 30, 2019 and December 31, 2018 were $401 and $287 respectively.

 

The depreciation expense for June 30, 2019 and 2018 were $738 and $742 respectively.

 

6. BIOLOGICAL ASSETS

 

Biological Assets of the Company comprise of agarwood sapling and plantation cost of agarwood.

 

The Company acquired the agarwood sapling at MYR98,800 (approximately $24,395) in 2017. The accumulated planation development costs incurred from commencement of planting of seedlings up to June 30, 2019 and December 31, 2018 were $35,510 and $28,697 respectively.

 

7. AMOUNT DUE TO DIRECTOR

 

As of June 30, 2019, and December 31, 2018, our directors has loaned to the Company $78,424 and $66,355 as working capital, respectively. This loan is unsecured, non-interest bearing and due on demand.

 

8. STOCKHOLDERS’ EQUITY

 

As of June 30, 2019, and December 31, 2018, there were 141,965,520 and 141,965,520 shares of common stock issued and outstanding respectively.

 

There were no stock options, warrants or other potentially dilutive securities outstanding as of June 30, 2019.

 

 F-10 
 

 

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

The information contained in this quarter report on Form 10-Q is intended to update the information contained in our Form 10-K dated April 9, 2019, for the year ended December 31, 2018 and presumes that readers have access to, and will have read, the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and other information contained in such Form S-1. The following discussion and analysis also should be read together with our financial statements and the notes to the financial statements included elsewhere in this Form 10-Q.

 

The following discussion contains certain statements that may be deemed “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements appear in a number of places in this Report, including, without limitation, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” These statements are not guarantees of future performance and involve risks, uncertainties and requirements that are difficult to predict or are beyond our control. Forward-looking statements speak only as of the date of this quarterly report. You should not put undue reliance on any forward-looking statements. We strongly encourage investors to carefully read the factors described in our Form 10-K dated April 9, 2019, in the section entitled “Risk Factors” for a description of certain risks that could, among other things, cause actual results to differ from these forward-looking statements. We assume no responsibility to update the forward-looking statements contained in this transition report on Form 10-Q. The following should also be read in conjunction with the unaudited Condensed Consolidated Financial Statements and notes thereto that appear elsewhere in this report.

 

Company Overview

 

United Royale Holdings Corp. (the “Company”) was incorporated under the laws of the State of Nevada on June 23, 2015. United Royale Holdings Corp., is a developmental stage company that intends to offer planting and cultivation services to land owners in regards to the planting and cultivation of Aquilaria Subintegra & Aquilaria Sinensis trees. The company also intend to provide services relating to the extraction of Agarwood (Agarwood is extracted from those tree, about 10-15% wood of the tree can become Agarwood) from such trees, through the process of “fungal inoculation.”

 

We offer planting and cultivation services to land owners in regards to the planting and cultivation of Aquilaria Subintegra & Aquilaria Sinensis trees. We also intend to provide services relating to the extraction of Agarwood from such trees through a process known as “inoculation.”

 

On February 1, 2018, the majority of the directors and shareholders of the Company adopted the resolution to request a name change of the Company from “Bosy Holdings Corp.” to “United Royale Holdings Corp.”. The name change became effective with the State of Nevada on February 5, 2018. FINRA announced on February 14, 2018 that the new name of “United Royale Holdings Corp.” was be effective on February 15, 2018, and the new ticker symbol of “URYL” was effective on February 15, 2018.

 

On March 30, 2018, Mr. Teoh Kooi Sooi resigned from the President of the Company. And Mr. Teoh retained his position of Chief Executive Officer, treasurer, and director in the board. The resignation was not the result of any disagreement with the Company on any matter relating to the Company’s operations, policies or practices. Mr. Teoh Kooi Sooi has been the President of the Company since September 18, 2015.

 

On March 30, 2018, Mr. Chen Zheru resigned from the Secretary of the Company. And Mr. Chen will retain his position of director in the board. The resignation was not the result of any disagreement with the Company on any matter relating to the Company’s operations, policies or practices. Mr. Chen Zheru has been the Secretary of the Company since September 18, 2015.

 

On March 30, 2018, Ms. Jaya C Rajamanickam was appointed as the Company’s new President. Ms. Feliana Binti Johny was appointed as the Company’s new Secretary. The biographies for new officers of the Company was filed in the Form 8-K filed with SEC on March 30, 2018.

 

On September 30, 2018, the Company and Mr. CHEN Zheru, representing the sole shareholder of IV Enterprises Development Limited, a Seychelles corporation (“IVED”), entered into a Sale and Purchase Agreement, pursuant to which the Company acquired 100% (one hundred percent) of the shareholding of IVED. IVED provides tree nurseries, including planting, cultivation and inoculation services through its wholly-owned subsidiary, Oudh Tech Sdn Bhd, in Malaysia. The acquisition is completed on September 30, 2018.

 

On October 22, 2018, Mr. David Edwin Evans was appointed as the Company’s Chief Operating Officer. Mr. Liao Lin was appointed as the Company’s Chief Sales Officer. The biographies for new officers of the Company was filed in the Form 8-K filed with SEC on October 22, 2018.

 

On November 30, 2018, Mr. Chen Zheru resigned from the board of directors with the Company. The resignation was not the result of any disagreement with the Company on any matter relating to the Company’s operations, policies or practices. Mr. Chen Zheru has been the director of the Company since September 18, 2015. On the same day, Mr. Li Gongming was appointed as the Company’s new member of board of directors.

 

On December 5, 2018, as a result of a private transaction, 100% shareholding of Bosy Holdings Limited has been transferred from Mr. Chen Zheru to Mr. Li Gongming. The consideration paid for the transaction was $50,000. The source of the cash consideration for the transaction was personal funds of the Purchaser. Bosy Holdings Limited, a limited liability company incorporated in Seychelles, holds 78,415,100 shares of United Royale Holdings Corp. The Transaction resulted in the Purchaser acquiring a total of 55.235% of the issued and outstanding share capital of the Company on a fully-diluted basis, which caused a change in control of the Company. And Mr. Li owns 6,000,000 shares of the Company as of December 7, 2018, which constitutes a total shareholding of 59.461% of the Company.

 

On April 1, 2019, the Company entered into a six-year tenancy agreement with Halaman Girang Sdn Bhd, the landlord of the farmland, for renting Lot 4316, Batu 20, Jalan Segamat, 84900, Tangkak, Johor, Malaysia. The monthly rental payment is MYR1,500, equivalent to around $363. The tenancy period is valid from April 1, 2019 to March 31, 2025.

 

On April 1, 2019, the Company entered into an agarwood management agreement with Ms. Simone Yap Xin Wei for providing agarwood plantation management and farming operations in the farmland. The agreement is valid from April 1, 2019 to March 31, 2020, with monthly service fee of MYR2,640, equivalent to $639.

 

On June 12, 2019, Mr. Soh Khay Wee was appointed as the Company’s Director. The biographies for new officers of the Company was filed in the Form 8-K filed with SEC on June 12, 2019. 

 

-3-

 

 

Results of Operation

 

For the three and six months period ended June 30, 2019 and 2018

 

Revenues

 

We have not generated any revenue for the three and six months ended June 30, 2019 and 2018.

 

General and administrative expenses

 

We incurred a total of $66,906 and $117,093 general and administrative expenses during the three and six months ended June 30, 2019, while we incurred a total of $30,745 and $75,289 general and administrative expenses during the three and six months ended June 30, 2018 respectively. The general and administrative expenses are mainly comprised of salary, Form 10-Q review fee, consulting fee, legal fee, transfer agent fee and Edgar Filing fee. The increase of general and administrative expenses is due to increase in salary expense and consulting fee.

 

Net loss

 

For the three and six months ended June 30, 2019 and 2018, we had generated no revenues. We incurred a total net loss of $66,559 and $116,746 for the three and six months ended June 30, 2019 respectively, while we incurred a total net loss of $30,649 and $75,229 for the three and six months ended June 30, 2018 respectively.

 

Liquidity and Capital Resources

 

Cash Used In Operating Activities

 

For the six months ended June 30, 2019 and 2018, the cash flows used in investing activities was $6,866 and $7,173 respectively, consists of additional of accumulation of biological assets.

 

Cash Used In Investing and Financing Activities

 

For the six months ended June 30, 2019 and 2018, the cash flows provided by financial activities was $12,148 and $27,157 respectively, consists of advance from directors.

 

Off-balance Sheet Arrangements

 

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to our stockholders as of June 30, 2019.

 

-4-

 

 

Item 3 Quantitative and Qualitative Disclosures About Market Risk.

 

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide information required by this Item.

 

Item 4 Controls and Procedures.

 

Evaluation of Disclosure Controls and Procedures:

 

We carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of June 30, 2019. This evaluation was carried out under the supervision and with the participation of our Chief Executive Officer and our Chief Operations Officer. Based upon that evaluation, our Chief Executive Officer and Chief Operations Officer concluded that, as of June 30, 2019, our disclosure controls and procedures were not effective due to the presence of material weaknesses in internal control over financial reporting.

 

A material weakness is a deficiency, or a combination of 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. Management has identified the following material weaknesses which have caused management to conclude that, as of June 30, 2019, our disclosure controls and procedures were not effective: (i) inadequate segregation of duties and effective risk assessment; and (ii) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of both US GAAP and SEC guidelines.

 

Changes in Internal Control over Financial Reporting:

 

There were no changes in our internal control over financial reporting during the quarter ending June 30, 2019, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

-5-

 

 

PART II — OTHER INFORMATION

 

Item 1. Legal Proceedings

 

We know of no materials, active or pending legal proceedings against us, nor are we involved as a plaintiff in any material proceedings or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any beneficial shareholder are an adverse party or has a material interest adverse to us.

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

 

None.

 

Item 3. Defaults Upon Senior Securities

 

None.

 

Item 4. Mine Safety Disclosures

 

Not applicable.

 

Item 5. Other Information.

 

None.

 

ITEM 6. Exhibits

 

31.1 Rule 13(a)-14(a)/15(d)-14(a) Certification of principal executive officer
     
32.1 Section 1350 Certification of principal executive officer

 

-6-

 

 

SIGNATURES

 

Pursuant to the requirements 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.

 

  UNITED ROYALE HOLDINGS CORP.
  (Name of Registrant)
     
Date: July 30, 2019    
     
  By: /s/ Teoh Kooi Sooi
  Title:

Chief Executive Officer, Treasurer, Director

(Principal Executive Officer, Principal Financial Officer, Principal Accounting Officer)

 

-7-

 

 

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EXHIBIT 31.1 

 

CERTIFICATION

 

I, Teoh Kooi Sooi, certify that:

 

1. I have reviewed this quarterly report on Form 10-Q of UNITED ROYALE HOLDINGS CORP. (the “Company”) for the quarter ended June 30, 2019;

 

2. Based on my knowledge, this quarterly 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 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 functions):

 

  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.

 

Date: July 30, 2019 By: /s/ TEOH KOOI SOOI
    TEOH KOOI SOOI
    Chief Executive Officer, Treasurer, Director
     
    (Principal Executive Officer, Principal Financial Officer, Principal Accounting Officer)

 

 
 

 

EX-32.1 4 ex32-1.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

 

In connection with the Quarterly Report of UNITED ROYALE HOLDINGS CORP. (the “Company”) on Form 10-Q for the period ending June 30, 2019 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), The undersigned hereby certifies, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge and belief:

 

  (1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
     
  (2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

 

Date: July 30, 2019 By: /s/ Teoh Kooi Sooi
    Teoh Kooi Sooi
    Chief Executive Officer, Treasurer, Director
     
    (Principal Executive Officer, Principal Financial Officer, Principal Accounting 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 has been provided to the Company and will be retained by the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

 

 
 

 

 

 

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Par value $0.0001; Authorized: 200,000,000 None issued and outstanding Common stock - Par value $ 0.0001; Authorized: 600,000,000 Issued and outstanding: 141,965,520 shares as of June 30, 2019 and December 31, 2018 Additional paid-in capital Accumulated other comprehensive loss Accumulated deficit TOTAL STOCKHOLDERS' EQUITY TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY Restricted cash Preferred stock, par value Preferred stock, shares authorized Preferred stock, shares issued Preferred stock, shares outstanding Common stock, par value Common stock, shares authorized Common stock, shares issued Common stock, shares outstanding Income Statement [Abstract] REVENUE COST OF REVENUE GROSS PROFIT OPERATING EXPENSES: General and administrative LOSS FROM OPERATIONS OTHER EXPENSE Other income (expense), net LOSS BEFORE INCOME TAX INCOME TAX EXPENSE NET LOSS Other comprehensive loss: - Foreign currency translation income (loss) COMPREHENSIVE LOSS NET LOSS PER SHARE, BASIC AND DILUTED WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING, BASIC AND DILUTED Statement [Table] Statement [Line Items] Beginning balance Beginning balance, shares Net loss Foreign currency translation Ending balance Ending balance, shares Statement of Cash Flows [Abstract] CASH FLOWS FROM OPERATING ACTIVITIES: Adjustments to reconcile net loss to net cash used in operating activities Depreciation expenses Changes in operating assets and liabilities: Decrease in accrued liabilities Increase in prepaid expenses Net cash flows used in operating activities CASH FLOWS USED IN INVESTING ACTIVITIES: Additional of accumulation cost of biological assets Net cash flows used in investing activities CASH FLOWS FROM FINANCING ACTIVITIES Advance from directors Net cash provided by financing activities Effect of exchange rate changes in cash and cash equivalents Net changes in cash and cash equivalents Cash and cash equivalents, beginning of period CASH AND CASH EQUIVALENTS, END OF YEAR/PERIOD SUPPLEMENTAL CASH FLOWS INFORMATION Income taxes paid Interest paid Organization, Consolidation and Presentation of Financial Statements [Abstract] Basis of Presentation Description of Business and Organization Accounting Policies [Abstract] Summary of Significant Accounting Policies Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] Prepaid Expenses Property, Plant and Equipment [Abstract] Plant and Equipment, Net Biological Assets Related Party Transactions [Abstract] Amount Due to Director Equity [Abstract] Stockholders' Equity Basis of Presentation Use of Estimates Going Concern Cash and Cash Equivalents Plant and Equipment Biological Assets Foreign Currencies Translation Revenue Recognition Income Taxes Fair Value of Financial Instruments Recent Accounting Pronouncements Schedule of Estimated Useful Lives of Plant and Equipment Schedule of Foreign Currency Translation Schedule of Plant and Equipment, Net Acquisition percentage Statistical Measurement [Axis] Net cash flows used in operating activities Compensation balance, description Compensation balance, amount Commercial harvesting term of biological assets Tax benefit likelihood percentage, description Plant and equipment useful life Foreign Currency Exchange Rate, Translation Prepaid expenses Deposit Payments to acquire plant and equipment Accumulated depreciation Depreciation expense Property and equipment, gross Less: Accumulated Depreciation Plant and equipment, net Payment to acquire biological assets Accumulated planation development costs Due to Director Dilutive securities outstanding Accountant [Member] Agarwood Sapling [Member] Biological Assets. Biological Assets [Policy Text Block] Biological Assets [Text Block] Bosy Holdings (HK) Limited [Member] Commercial harveting term of biological assets. Computer [Member] Computer and Software [Member] Customer A [Member] Customer [Member] Engine Pump [Member] Equipment and Software [Member] HSBC Hong Kong [Member] Mr. Chen [Member] Mr. Chen Zheru [Member] Mr. Li [Member] Mr. Teoh Kooi Sooi [Member] Mr. Teoh [Member] Mr. Teoh Sooi Kooi [Member] Ms. Chen Huile [Member] Ms. Chen Yanhong [Member] Other (Primarily Nontaxable Jurisdictions) [Member] Other Potentially Dilutive Securities [Member] Oudh Tech Sdn Bhd [Member] Period Average MYR [Member] Period End Average HK [Member] Period End MYR [Member] Prepaid Expenses [Text Block] Prepaid Services Fee [Member] Purchase of biological assets. Retainers Fee [Member] Schedule of Estimated Useful Lives of Plant and Equipment [Table Text Block] Software [Member] Stock Options [Member] Subscription Agreements [Member] Subscription Agreements [Member] 39 Investors [Member] United States of America [Member] Vendor A [Member] Vendors [Member] Warrants [Member] HKD Currency [Member] MYR Currency [Member] Consulting Service Provider [Member] Farmland Provider [Member] Payment to acquire biological assets. OTCQB Annual Fee [Member] Going Concern [Policy Text Block] Assets, Current Assets Liabilities, Current Liabilities Stockholders' Equity Attributable to Parent Liabilities and Equity Cost of Revenue Gross Profit General and Administrative Expense Operating Income (Loss) Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest Comprehensive Income (Loss), Net of Tax, Attributable to Parent Shares, Outstanding Increase (Decrease) in Prepaid Expense PurchaseOfBiologicalAssets Net Cash Provided by (Used in) Investing Activities Net Cash Provided by (Used in) Financing Activities Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Period Increase (Decrease), Including Exchange Rate Effect Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Including Disposal Group and Discontinued Operations Basis of Accounting, Policy [Policy Text Block] BiologicalAssetsPolicyTextBlock Prepaid Expense EX-101.PRE 10 uryl-20190630_pre.xml XBRL PRESENTATION FILE XML 11 R1.htm IDEA: XBRL DOCUMENT v3.19.2
Document and Entity Information - shares
6 Months Ended
Jun. 30, 2019
Jul. 30, 2019
Document And Entity Information    
Entity Registrant Name United Royale Holdings Corp.  
Entity Central Index Key 0001652842  
Document Type 10-Q  
Document Period End Date Jun. 30, 2019  
Amendment Flag false  
Current Fiscal Year End Date --12-31  
Entity Current Reporting Status Yes  
Entity Interactive Data Current No  
Entity Filer Category Non-accelerated Filer  
Entity Small Business Flag true  
Entity Emerging Growth Company true  
Entity Ex Transition Period false  
Entity Shell Company false  
Entity Common Stock, Shares Outstanding   141,965,520
Document Fiscal Period Focus Q2  
Document Fiscal Year Focus 2019  
XML 12 R2.htm IDEA: XBRL DOCUMENT v3.19.2
Condensed Consolidated Balance Sheets - USD ($)
Jun. 30, 2019
Dec. 31, 2018
CURRENT ASSETS    
Cash and cash equivalents (Nil at June 30, 2019; including $6,394 of restricted cash at December 31, 2018) $ 129,021 $ 261,930
Prepaid expenses 14,988 13,931
TOTAL CURRENT ASSETS 144,009 275,861
NON-CURRENT ASSETS    
Plant and equipment, net 2,729 3,468
Biological assets 35,510 28,697
TOTAL ASSETS 182,248 308,026
CURRENT LIABILITIES    
Accrued liabilities 6,718 27,790
Due to director 78,424 66,355
TOTAL CURRENT LIABILITIES 85,142 94,145
TOTAL LIABILITIES 85,142 94,145
STOCKHOLDERS' EQUITY    
Preferred stock - Par value $0.0001; Authorized: 200,000,000 None issued and outstanding
Common stock - Par value $ 0.0001; Authorized: 600,000,000 Issued and outstanding: 141,965,520 shares as of June 30, 2019 and December 31, 2018 14,197 14,197
Additional paid-in capital 650,712 650,712
Accumulated other comprehensive loss (489) (460)
Accumulated deficit (567,314) (450,568)
TOTAL STOCKHOLDERS' EQUITY 97,106 213,881
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 182,248 $ 308,026
XML 13 R3.htm IDEA: XBRL DOCUMENT v3.19.2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($)
Jun. 30, 2019
Dec. 31, 2018
Statement of Financial Position [Abstract]    
Restricted cash $ 6,394
Preferred stock, par value $ 0.0001 $ 0.0001
Preferred stock, shares authorized 200,000,000 200,000,000
Preferred stock, shares issued
Preferred stock, shares outstanding
Common stock, par value $ 0.0001 $ 0.0001
Common stock, shares authorized 600,000,000 600,000,000
Common stock, shares issued 141,965,520 141,965,520
Common stock, shares outstanding 141,965,520 141,965,520
XML 14 R4.htm IDEA: XBRL DOCUMENT v3.19.2
Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($)
3 Months Ended 6 Months Ended
Jun. 30, 2019
Jun. 30, 2018
[1]
Jun. 30, 2019
Jun. 30, 2018
[1]
Income Statement [Abstract]        
REVENUE
COST OF REVENUE
GROSS PROFIT
OPERATING EXPENSES:        
General and administrative (66,906) (30,745) (117,093) (75,289)
LOSS FROM OPERATIONS (66,906) (30,745) (117,093) (75,289)
OTHER EXPENSE        
Other income (expense), net 347 96 347 60
LOSS BEFORE INCOME TAX (66,559) (30,649) (116,746) (75,229)
INCOME TAX EXPENSE
NET LOSS (66,559) (30,649) (116,746) (75,229)
Other comprehensive loss:        
- Foreign currency translation income (loss) 90 663 (29) (33)
COMPREHENSIVE LOSS $ (66,469) $ (29,986) $ (116,775) $ (75,262)
NET LOSS PER SHARE, BASIC AND DILUTED $ (0.00) $ (0.00) $ (0.00) $ (0.00)
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING, BASIC AND DILUTED 141,965,520 141,965,520 141,965,520 141,965,520
[1] The prior year comparative information has been retrospectively stated due to the common control acquisition on September 30, 2018.
XML 15 R5.htm IDEA: XBRL DOCUMENT v3.19.2
Condensed Consolidated Statements of Changes in Stockholders' Equity - USD ($)
Common Stock [Member]
Additional Paid-In Capital [Member]
Accumulated Other Comprehensive Loss [Member]
Accumulated Deficit [Member]
Total
Beginning balance at Dec. 31, 2017 $ 14,197 $ 643,448 $ (739) $ (252,091) $ 404,815
Beginning balance, shares at Dec. 31, 2017 141,965,520        
Net loss (44,580) (44,580)
Foreign currency translation (696) (696)
Ending balance at Mar. 31, 2018 [1] $ 14,197 643,448 (1,435) (296,671) 359,539
Ending balance, shares at Mar. 31, 2018 [1] 141,965,520        
Beginning balance at Dec. 31, 2017 $ 14,197 643,448 (739) (252,091) 404,815
Beginning balance, shares at Dec. 31, 2017 141,965,520        
Net loss [1]         (75,229)
Ending balance at Jun. 30, 2018 [1] $ 14,197 643,448 (772) (327,320) 329,553
Ending balance, shares at Jun. 30, 2018 [1] 141,965,520        
Beginning balance at Mar. 31, 2018 [1] $ 14,197 643,448 (1,435) (296,671) 359,539
Beginning balance, shares at Mar. 31, 2018 [1] 141,965,520        
Net loss (30,649) (30,649) [1]
Foreign currency translation 663 663
Ending balance at Jun. 30, 2018 [1] $ 14,197 643,448 (772) (327,320) 329,553
Ending balance, shares at Jun. 30, 2018 [1] 141,965,520        
Beginning balance at Dec. 31, 2018 $ 14,197 650,712 (460) (450,568) 213,881
Beginning balance, shares at Dec. 31, 2018 141,965,520        
Net loss (50,187) (50,187)
Foreign currency translation (119) (119)
Ending balance at Mar. 31, 2019 $ 14,197 650,712 (579) (500,755) 163,575
Ending balance, shares at Mar. 31, 2019 141,965,520        
Beginning balance at Dec. 31, 2018 $ 14,197 650,712 (460) (450,568) 213,881
Beginning balance, shares at Dec. 31, 2018 141,965,520        
Net loss         (116,746)
Ending balance at Jun. 30, 2019 $ 14,197 650,712 (489) (567,314) 97,106
Ending balance, shares at Jun. 30, 2019 141,965,520        
Beginning balance at Mar. 31, 2019 $ 14,197 650,712 (579) (500,755) 163,575
Beginning balance, shares at Mar. 31, 2019 141,965,520        
Net loss (66,559) (66,559)
Foreign currency translation 90 90
Ending balance at Jun. 30, 2019 $ 14,197 $ 650,712 $ (489) $ (567,314) $ 97,106
Ending balance, shares at Jun. 30, 2019 141,965,520        
[1] The prior year comparative information has been retrospectively stated due to the common control acquisition on September 30, 2018.
XML 16 R6.htm IDEA: XBRL DOCUMENT v3.19.2
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)
6 Months Ended
Jun. 30, 2019
Jun. 30, 2018
[1]
CASH FLOWS FROM OPERATING ACTIVITIES:    
Net loss $ (116,746) $ (75,229)
Adjustments to reconcile net loss to net cash used in operating activities    
Depreciation expenses 738 742
Changes in operating assets and liabilities:    
Decrease in accrued liabilities (21,067) (9,000)
Increase in prepaid expenses (1,057) (4,850)
Net cash flows used in operating activities (138,132) (88,337)
CASH FLOWS USED IN INVESTING ACTIVITIES:    
Additional of accumulation cost of biological assets (6,866) (7,173)
Net cash flows used in investing activities (6,866) (7,173)
CASH FLOWS FROM FINANCING ACTIVITIES    
Advance from directors 12,148 27,157
Net cash provided by financing activities 12,148 27,157
Effect of exchange rate changes in cash and cash equivalents (60) (490)
Net changes in cash and cash equivalents (132,910) (68,843)
Cash and cash equivalents, beginning of period 261,930 448,684
CASH AND CASH EQUIVALENTS, END OF YEAR/PERIOD 129,020 379,841
SUPPLEMENTAL CASH FLOWS INFORMATION    
Income taxes paid
Interest paid
[1] The prior year comparative information has been retrospectively stated due to the common control acquisition on September 30, 2018.
XML 17 R7.htm IDEA: XBRL DOCUMENT v3.19.2
Basis of Presentation
6 Months Ended
Jun. 30, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Basis of Presentation
1. BASIS OF PRESENTATION

 

The accompanying unaudited condensed consolidated financial statements have been prepared by management in accordance with both accounting principles generally accepted in the United States (“GAAP”), and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Certain information and note disclosures normally included in audited financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to those rules and regulations, although the Company believes that the disclosures made are adequate to make the information not misleading.

 

In the opinion of management, the balance sheet as of June 30, 2019 which has been derived from unaudited financial statements and these unaudited condensed consolidated financial statements reflect all normal and recurring adjustments considered necessary to state fairly the results for the periods presented. The results for the period ended June 30, 2019 are not necessarily indicative of the results to be expected for the entire fiscal year ending December 31, 2019 or for any future period.

 

These unaudited condensed consolidated financial statements and notes thereto should be read in conjunction with the Management’s Discussion and the audited financial statements and notes thereto included in the Form 10-K for the year ended December 31, 2018.

XML 18 R8.htm IDEA: XBRL DOCUMENT v3.19.2
Description of Business and Organization
6 Months Ended
Jun. 30, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Description of Business and Organization
2. DESCRIPTION OF BUSINESS AND ORGANIZATION

 

United Royale Holdings Corp., formerly known as Bosy Holdings Corp. (“the Company”, “we”, “us” or “our”) was incorporated in the State of Nevada on June 23, 2015. We intend to offer planting and cultivation services to land owners in regards to the planting and cultivation of Aquilaria Subintegra & Aquilaria Sinensis trees. We also intend to provide services relating to the extraction of Agarwood from such trees through a process known as “inoculation.”

 

On September 30, 2018, the Company and Mr. CHEN Zheru, representing the sole shareholder of IV Enterprises Development Limited, a Seychelles corporation (“IVED”), entered into a Sale and Purchase Agreement, pursuant to which the Company acquired 100% (one hundred percent) of the shareholding of IVED. IVED provides tree nurseries, including planting, cultivation and inoculation services through its wholly-owned subsidiary, Oudh Tech Sdn Bhd, in Malaysia. The acquisition is completed on September 30, 2018.

 

Mr. CHEN Zheru is the common director and major shareholder of the Company and IVED. As a result of this common ownership and in accordance with the FASB Accounting Standards Codification Section 805 “Business Combination”, the transaction is being treated as a combination between entities under common control. The recognized assets and liabilities were transferred at their carrying amounts at the date of the transaction. The equity accounts of the combining entities are combined. Further, the companies will be combined retrospectively for prior year comparative information as if the transaction had occurred on January 1, 2017.

XML 19 R9.htm IDEA: XBRL DOCUMENT v3.19.2
Summary of Significant Accounting Policies
6 Months Ended
Jun. 30, 2019
Accounting Policies [Abstract]  
Summary of Significant Accounting Policies
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Basis of presentation

 

The accompanying financial statements are prepared in accordance with generally accepted accounting principles in the United States of America (“US GAAP”).

 

The accompanying financial statements include the accounts of the Company and its wholly-owned subsidiaries. Intercompany transactions and balances were eliminated in consolidation.

 

Below is the organization chart of the Group.

 

https:||www.sec.gov|Archives|edgar|data|1652842|000149315218016437|image_001.jpg

 

Use of estimates

 

Management uses estimates and assumptions in preparing these financial statements in accordance with US GAAP. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities in the balance sheet, and the reported revenue and expenses during the periods reported. Actual results may differ from these estimates.

 

Going Concern

 

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. During the six months ended June 30, 2019, the Company incurred a net loss of $116,746 and used cash in operations of $138,132. These factors raise substantial doubt about the Company’s ability to continue as a going concern within one year of the date that the financial statements are issued. In addition, the Company’s independent registered public accounting firm, in its report on the Company’s December 31, 2018 financial statements, has expressed substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

 

The Company’s ability to continue as a going concern is dependent upon improving its profitability and the continuing financial support from its shareholders. Management believes the existing shareholders or external financing will provide the additional cash to meet the Company’s obligations as they become due. Despite the amount of funds that we have raised, no assurance can be given that any future financing, if needed, will be available or, if available, that it will be on terms that are satisfactory to the Company. Even if the Company is able to obtain additional financing, if needed, it may contain undue restrictions on its operations, in the case of debt financing, or cause substantial dilution for its stockholders, in the case of equity financing.

 

Cash and cash equivalents

 

Cash and cash equivalents are carried at cost and represent cash on hand, demand deposits placed with banks or other financial institutions and all highly liquid investments with an original maturity of three months or less as of the purchase date of such investments. Restricted cash represents cash restricted by Hang Seng Bank as the bank account was forced to close on October 5, 2018, and this amount of cash was held by Hang Seng Bank. The reason for forced closure was a long period dormant without account activity. On February 25, 2019, our management went to Hang Seng Bank in person to withdraw the money and deposited in HSBC Hong Kong respectively.

 

Our deposit is currently deposit in HSBC Hong Kong, and there is a Deposit Protection Scheme protects our eligible deposits held with bank in Hong Kong which is members of the Scheme. The scheme will pay us a compensation up to a limit of HKD500,000, which is equivalent to $64,102, if HSBC Hong Kong fails.

 

Plant and equipment

 

Plant and equipment are stated at cost less accumulated depreciation and impairment. Depreciation of plant, equipment and software are calculated on the straight-line method over their estimated useful lives or lease terms generally as follows:

 

Classification   Useful Life
Computer and Software   3 years
Equipment   10 years

 

The Company purchased 2 computers at the end of June 2017, and the computers has been subject to depreciation since the utilization in July 2017. Expenditures for maintenance and repairs will be expensed as incurred.

 

Biological Assets

 

Biological Assets of the Company comprise of agarwood sapling and plantation cost of agarwood.

 

Pursuant to ASC 905-360-25-2, biological Assets are planted and brought to production by the Company or on a contract basis. Saplings are usually purchased as nursery stock and transplanted into the farmland in the desired pattern. Cost of biological assets consists of accumulated planation development costs incurred from commencement of planting of seedlings up to maturity of the crop cultivated. Capitalization of planation development and other operating costs ceases upon commencement of commercial harvesting, which range from 7 to 9 years. Net proceeds from sales of products before commercial production begins shall be applied to the capitalized cost of the plants, trees, or vines.

 

Biological Assets is measured using average cost, and is measured at the lower of cost and net realizable value. When evidence exists that the net realizable value of biological Assets is lower than its cost, the difference shall be recognized as a loss in earnings in the period in which it occurs. Impairment loss may be required, for example, due to damage, physical deterioration, obsolescence, changes in price levels, or other causes.

 

Pursuant to ASC 905-360-35-4, when production in commercial quantities begins, the accumulated costs shall be depreciated over the estimated useful life of the particular farmland.

 

Foreign currencies translation

 

Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the statement of operations.

 

The reporting currency of the Company is the United States Dollars (“US$”) and the accompanying financial statements have been expressed in US$. Hong Kong Dollars (“HK$”), which is the respective functional currencies for the Company as the deposit is currently kept in HSBC Hong Kong. In addition, the Company’s subsidiaries maintain their books and records in their respective local currency, which consists of the Hong Kong Dollars (“HK$”) and Malaysian Ringgit (“MYR”), which is also the respective functional currency of the subsidiaries.

 

Translation of amounts from the local currencies of the Company into US$ has been made at the following exchange rates for the respective periods:

 

   As of and for the six months ended
June 30,
 
   2019
(Unaudited)
   2018
(Unaudited)
 
Period-end MYR : US$1 exchange rate   4.13    4.04 
Period-average MYR : US$1 exchange rate   4.11    3.94 
Period-end / average HK$ : US$1 exchange rate   7.75    7.75 

 

Revenue recognition

 

In accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 606, “Revenue From Contracts With Customers”, the Company recognizes revenue from sales of goods and services when the following five following steps are carried out: (1) Identify the contract; (2) Identify the performance obligations; (3) Determine the transaction price; (4) Allocate the transaction price; (5) Recognize revenue. For the six months ended June 30, 2019, the Company had no revenue recorded, as a result, there was no effect on revenue by adopting ASC 606 starting from January 1, 2018.

 

Income taxes

 

The Company accounts for income taxes using the asset and liability method. The asset and liability method requires recognition of deferred tax assets and liabilities for expected future tax consequences of temporary differences that currently exist between tax bases and financial reporting bases of the Company’s assets and liabilities. Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which these temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is provided on deferred taxes if it is determined that it is more likely than not that the asset will not be realized. The Company recognizes penalties and interest accrued related to income tax liabilities in the provision for income taxes in its Consolidated Statements of Income.

 

Significant management judgment is required to determine the amount of benefit to be recognized in relation to an uncertain tax position. The Company uses a two-step process to evaluate tax positions. The first step requires an entity to determine whether it is more likely than not (greater than 50% chance) that the tax position will be sustained. The second step requires an entity to recognize in the financial statements the benefit of a tax position that meets the more-likely-than-not recognition criterion. The amounts ultimately paid upon resolution of issues raised by taxing authorities may differ materially from the amounts accrued and may materially impact the financial statements of the Company in future periods.

 

Fair value of financial instruments

 

The carrying value of the Company’s financial instruments: cash and cash equivalents, prepayments, amount due to a director and accrued liabilities approximate at their fair values because of the short-term nature of these financial instruments.

 

The Company follows the guidance of the ASC Topic 820-10, “Fair Value Measurements and Disclosures” (“ASC 820-10”), with respect to financial assets and liabilities that are measured at fair value. ASC 820-10 establishes a three-tier fair value hierarchy that prioritizes the inputs used in measuring fair value as follows:

 

● Level 1 : Observable inputs such as quoted prices in active markets;

 

● Level 2 : Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and

 

● Level 3 : Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions

 

Recent accounting pronouncements

 

In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606) (ASU 2014-09), which amends the existing accounting standards for revenue recognition. In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date, which delays the effective date of ASU 2014-09 by one year. The FASB also agreed to allow entities to choose to adopt the standard as of the original effective date. In March 2016, the FASB issued Accounting Standards Update No. 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net) (ASU 2016-08) which clarifies the implementation guidance on principal versus agent considerations. The guidance includes indicators to assist an entity in determining whether it controls a specified good or service before it is transferred to the customers. The new standard further requires new disclosures about contracts with customers, including the significant judgments the company has made when applying the guidance. We adopted the new standard effective January 1, 2018, using the modified retrospective transition method. We finalized our analysis and the adoption of this guidance will not have a material impact on our consolidated financial statements and our internal controls over financial reporting.

 

In November 2016, the FASB issued Accounting Standards Update No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash (ASU 2016-18), which requires companies to include amounts generally described as restricted cash and restricted cash equivalents in cash and cash equivalents when reconciling beginning-of-period and end-of-period total amounts shown on the statement of cash flows. We adopted the new standard effective January 1, 2018, and do not expect the standard to have a material impact on our financial statements.

 

In January 2017, the FASB issued Accounting Standards Update No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business (ASU 2017-01), which revises the definition of a business and provides new guidance in evaluating when a set of transferred assets and activities is a business. We adopted the new standard effective January 1, 2018 on a prospective basis. The new standard did not have a material impact on our consolidated financial statements.

 

In February 2016, the FASB issued Accounting Standards Update No. 2016-02, Leases (Topic 842) (ASU 2016-02), as amended, which generally requires lessees to recognize operating and financing lease liabilities and corresponding right-of-use assets on the balance sheet and to provide enhanced disclosures surrounding the amount, timing and uncertainty of cash flows arising from leasing arrangements. We will adopt the new standard effective January 1, 2019 on a modified retrospective basis and will not restate comparative periods. We will elect the package of practical expedients permitted under the transition guidance, which allows us to carryforward our historical lease classification, our assessment on whether a contract is or contains a lease, and our initial direct costs for any leases that exist prior to adoption of the new standard. We will also elect to combine lease and non-lease components and to keep leases with an initial term of 12 months or less off the balance sheet and recognize the associated lease payments in the consolidated statements of income on a straight-line basis over the lease term. We do not expect the new standard to have a material impact on our remaining consolidated financial statements.

 

The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and do not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations.

XML 20 R10.htm IDEA: XBRL DOCUMENT v3.19.2
Prepaid Expenses
6 Months Ended
Jun. 30, 2019
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]  
Prepaid Expenses
4. PREPAID EXPENSES

 

The prepaid expenses as of June 30, 2019 included OTCQB annual fee of $6,000, deposit of $1,852 in transfer agent, deposit of $6,410 in the consulting service provider and $726 in our farmland provider, while the prepaid expenses as of December 31, 2018 included OTCQB annual fee of $12,000, deposit of $1,205 in the transfer agent and deposit of $726 in our farmland provider.

XML 21 R11.htm IDEA: XBRL DOCUMENT v3.19.2
Plant and Equipment, Net
6 Months Ended
Jun. 30, 2019
Property, Plant and Equipment [Abstract]  
Plant and Equipment, Net
5. PLANT AND EQUIPMENT, NET

 

   As of
June 30, 2019
   As of
December 31, 2018
 
   (Unaudited)     
Computer and Software  $3,878   $3,878 
Equipment   1,815    1,816 
    5,693    5,694 
Less: Accumulated Depreciation   (2,964)   (2,226)
Plant and equipment, net  $2,729   $3,468 

 

The Company acquired computers and a software at $3,731 and $147 respectively in 2017, and the accumulated depreciations as of June 30, 2019 and December 31, 2018 were $2,585 and $1,939 respectively.

 

The Company acquired Engine Pump at MYR7,500 (approximately $1,852) in 2017. The accumulated depreciations as of June 30, 2019 and December 31, 2018 were $401 and $287 respectively.

 

The depreciation expense for June 30, 2019 and 2018 were $738 and $742 respectively.

XML 22 R12.htm IDEA: XBRL DOCUMENT v3.19.2
Biological Assets
6 Months Ended
Jun. 30, 2019
Property, Plant and Equipment [Abstract]  
Biological Assets
6. BIOLOGICAL ASSETS

 

Biological Assets of the Company comprise of agarwood sapling and plantation cost of agarwood.

 

The Company acquired the agarwood sapling at MYR98,800 (approximately $24,395) in 2017. The accumulated planation development costs incurred from commencement of planting of seedlings up to June 30, 2019 and December 31, 2018 were $35,510 and $28,697 respectively.

XML 23 R13.htm IDEA: XBRL DOCUMENT v3.19.2
Amount Due to Director
6 Months Ended
Jun. 30, 2019
Related Party Transactions [Abstract]  
Amount Due to Director
7. AMOUNT DUE TO DIRECTOR

 

As of June 30, 2019, and December 31, 2018, our directors has loaned to the Company $78,424 and $66,355 as working capital, respectively. This loan is unsecured, non-interest bearing and due on demand.

XML 24 R14.htm IDEA: XBRL DOCUMENT v3.19.2
Stockholders' Equity
6 Months Ended
Jun. 30, 2019
Equity [Abstract]  
Stockholders' Equity
8. STOCKHOLDERS’ EQUITY

 

As of June 30, 2019, and December 31, 2018, there were 141,965,520 and 141,965,520 shares of common stock issued and outstanding respectively.

 

There were no stock options, warrants or other potentially dilutive securities outstanding as of June 30, 2019.

XML 25 R15.htm IDEA: XBRL DOCUMENT v3.19.2
Summary of Significant Accounting Policies (Policies)
6 Months Ended
Jun. 30, 2019
Accounting Policies [Abstract]  
Basis of Presentation

Basis of presentation

 

The accompanying financial statements are prepared in accordance with generally accepted accounting principles in the United States of America (“US GAAP”).

 

The accompanying financial statements include the accounts of the Company and its wholly-owned subsidiaries. Intercompany transactions and balances were eliminated in consolidation.

 

Below is the organization chart of the Group.

 

https:||www.sec.gov|Archives|edgar|data|1652842|000149315218016437|image_001.jpg

Use of Estimates

Use of estimates

 

Management uses estimates and assumptions in preparing these financial statements in accordance with US GAAP. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities in the balance sheet, and the reported revenue and expenses during the periods reported. Actual results may differ from these estimates.

Going Concern

Going Concern

 

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. During the six months ended June 30, 2019, the Company incurred a net loss of $116,746 and used cash in operations of $138,132. These factors raise substantial doubt about the Company’s ability to continue as a going concern within one year of the date that the financial statements are issued. In addition, the Company’s independent registered public accounting firm, in its report on the Company’s December 31, 2018 financial statements, has expressed substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

 

The Company’s ability to continue as a going concern is dependent upon improving its profitability and the continuing financial support from its shareholders. Management believes the existing shareholders or external financing will provide the additional cash to meet the Company’s obligations as they become due. Despite the amount of funds that we have raised, no assurance can be given that any future financing, if needed, will be available or, if available, that it will be on terms that are satisfactory to the Company. Even if the Company is able to obtain additional financing, if needed, it may contain undue restrictions on its operations, in the case of debt financing, or cause substantial dilution for its stockholders, in the case of equity financing.

Cash and Cash Equivalents

Cash and cash equivalents

 

Cash and cash equivalents are carried at cost and represent cash on hand, demand deposits placed with banks or other financial institutions and all highly liquid investments with an original maturity of three months or less as of the purchase date of such investments. Restricted cash represents cash restricted by Hang Seng Bank as the bank account was forced to close on October 5, 2018, and this amount of cash was held by Hang Seng Bank. The reason for forced closure was a long period dormant without account activity. On February 25, 2019, our management went to Hang Seng Bank in person to withdraw the money and deposited in HSBC Hong Kong respectively.

 

Our deposit is currently deposit in HSBC Hong Kong, and there is a Deposit Protection Scheme protects our eligible deposits held with bank in Hong Kong which is members of the Scheme. The scheme will pay us a compensation up to a limit of HKD500,000, which is equivalent to $64,102, if HSBC Hong Kong fails.

Plant and Equipment

Plant and equipment

 

Plant and equipment are stated at cost less accumulated depreciation and impairment. Depreciation of plant, equipment and software are calculated on the straight-line method over their estimated useful lives or lease terms generally as follows:

 

Classification   Useful Life
Computer and Software   3 years
Equipment   10 years

 

The Company purchased 2 computers at the end of June 2017, and the computers has been subject to depreciation since the utilization in July 2017. Expenditures for maintenance and repairs will be expensed as incurred.

Biological Assets

Biological Assets

 

Biological Assets of the Company comprise of agarwood sapling and plantation cost of agarwood.

 

Pursuant to ASC 905-360-25-2, biological Assets are planted and brought to production by the Company or on a contract basis. Saplings are usually purchased as nursery stock and transplanted into the farmland in the desired pattern. Cost of biological assets consists of accumulated planation development costs incurred from commencement of planting of seedlings up to maturity of the crop cultivated. Capitalization of planation development and other operating costs ceases upon commencement of commercial harvesting, which range from 7 to 9 years. Net proceeds from sales of products before commercial production begins shall be applied to the capitalized cost of the plants, trees, or vines.

 

Biological Assets is measured using average cost, and is measured at the lower of cost and net realizable value. When evidence exists that the net realizable value of biological Assets is lower than its cost, the difference shall be recognized as a loss in earnings in the period in which it occurs. Impairment loss may be required, for example, due to damage, physical deterioration, obsolescence, changes in price levels, or other causes.

 

Pursuant to ASC 905-360-35-4, when production in commercial quantities begins, the accumulated costs shall be depreciated over the estimated useful life of the particular farmland.

Foreign Currencies Translation

Foreign currencies translation

 

Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the statement of operations.

 

The reporting currency of the Company is the United States Dollars (“US$”) and the accompanying financial statements have been expressed in US$. Hong Kong Dollars (“HK$”), which is the respective functional currencies for the Company as the deposit is currently kept in HSBC Hong Kong. In addition, the Company’s subsidiaries maintain their books and records in their respective local currency, which consists of the Hong Kong Dollars (“HK$”) and Malaysian Ringgit (“MYR”), which is also the respective functional currency of the subsidiaries.

 

Translation of amounts from the local currencies of the Company into US$ has been made at the following exchange rates for the respective periods:

 

   As of and for the six months ended
June 30,
 
   2019
(Unaudited)
   2018
(Unaudited)
 
Period-end MYR : US$1 exchange rate   4.13    4.04 
Period-average MYR : US$1 exchange rate   4.11    3.94 
Period-end / average HK$ : US$1 exchange rate   7.75    7.75 
Revenue Recognition

Revenue recognition

 

In accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 606, “Revenue From Contracts With Customers”, the Company recognizes revenue from sales of goods and services when the following five following steps are carried out: (1) Identify the contract; (2) Identify the performance obligations; (3) Determine the transaction price; (4) Allocate the transaction price; (5) Recognize revenue. For the six months ended June 30, 2019, the Company had no revenue recorded, as a result, there was no effect on revenue by adopting ASC 606 starting from January 1, 2018.

Income Taxes

Income taxes

 

The Company accounts for income taxes using the asset and liability method. The asset and liability method requires recognition of deferred tax assets and liabilities for expected future tax consequences of temporary differences that currently exist between tax bases and financial reporting bases of the Company’s assets and liabilities. Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which these temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is provided on deferred taxes if it is determined that it is more likely than not that the asset will not be realized. The Company recognizes penalties and interest accrued related to income tax liabilities in the provision for income taxes in its Consolidated Statements of Income.

 

Significant management judgment is required to determine the amount of benefit to be recognized in relation to an uncertain tax position. The Company uses a two-step process to evaluate tax positions. The first step requires an entity to determine whether it is more likely than not (greater than 50% chance) that the tax position will be sustained. The second step requires an entity to recognize in the financial statements the benefit of a tax position that meets the more-likely-than-not recognition criterion. The amounts ultimately paid upon resolution of issues raised by taxing authorities may differ materially from the amounts accrued and may materially impact the financial statements of the Company in future periods.

Fair Value of Financial Instruments

Fair value of financial instruments

 

The carrying value of the Company’s financial instruments: cash and cash equivalents, prepayments, amount due to a director and accrued liabilities approximate at their fair values because of the short-term nature of these financial instruments.

 

The Company follows the guidance of the ASC Topic 820-10, “Fair Value Measurements and Disclosures” (“ASC 820-10”), with respect to financial assets and liabilities that are measured at fair value. ASC 820-10 establishes a three-tier fair value hierarchy that prioritizes the inputs used in measuring fair value as follows:

 

● Level 1 : Observable inputs such as quoted prices in active markets;

 

● Level 2 : Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and

 

● Level 3 : Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions

Recent Accounting Pronouncements

Recent accounting pronouncements

 

In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606) (ASU 2014-09), which amends the existing accounting standards for revenue recognition. In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date, which delays the effective date of ASU 2014-09 by one year. The FASB also agreed to allow entities to choose to adopt the standard as of the original effective date. In March 2016, the FASB issued Accounting Standards Update No. 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net) (ASU 2016-08) which clarifies the implementation guidance on principal versus agent considerations. The guidance includes indicators to assist an entity in determining whether it controls a specified good or service before it is transferred to the customers. The new standard further requires new disclosures about contracts with customers, including the significant judgments the company has made when applying the guidance. We adopted the new standard effective January 1, 2018, using the modified retrospective transition method. We finalized our analysis and the adoption of this guidance will not have a material impact on our consolidated financial statements and our internal controls over financial reporting.

 

In November 2016, the FASB issued Accounting Standards Update No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash (ASU 2016-18), which requires companies to include amounts generally described as restricted cash and restricted cash equivalents in cash and cash equivalents when reconciling beginning-of-period and end-of-period total amounts shown on the statement of cash flows. We adopted the new standard effective January 1, 2018, and do not expect the standard to have a material impact on our financial statements.

 

In January 2017, the FASB issued Accounting Standards Update No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business (ASU 2017-01), which revises the definition of a business and provides new guidance in evaluating when a set of transferred assets and activities is a business. We adopted the new standard effective January 1, 2018 on a prospective basis. The new standard did not have a material impact on our consolidated financial statements.

 

In February 2016, the FASB issued Accounting Standards Update No. 2016-02, Leases (Topic 842) (ASU 2016-02), as amended, which generally requires lessees to recognize operating and financing lease liabilities and corresponding right-of-use assets on the balance sheet and to provide enhanced disclosures surrounding the amount, timing and uncertainty of cash flows arising from leasing arrangements. We will adopt the new standard effective January 1, 2019 on a modified retrospective basis and will not restate comparative periods. We will elect the package of practical expedients permitted under the transition guidance, which allows us to carryforward our historical lease classification, our assessment on whether a contract is or contains a lease, and our initial direct costs for any leases that exist prior to adoption of the new standard. We will also elect to combine lease and non-lease components and to keep leases with an initial term of 12 months or less off the balance sheet and recognize the associated lease payments in the consolidated statements of income on a straight-line basis over the lease term. We do not expect the new standard to have a material impact on our remaining consolidated financial statements.

 

The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and do not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations

XML 26 R16.htm IDEA: XBRL DOCUMENT v3.19.2
Summary of Significant Accounting Policies (Tables)
6 Months Ended
Jun. 30, 2019
Accounting Policies [Abstract]  
Schedule of Estimated Useful Lives of Plant and Equipment

Depreciation of plant, equipment and software are calculated on the straight-line method over their estimated useful lives or lease terms generally as follows:

 

Classification   Useful Life
Computer and Software   3 years
Equipment   10 year
Schedule of Foreign Currency Translation

Translation of amounts from the local currencies of the Company into US$ has been made at the following exchange rates for the respective periods:

 

   As of and for the six months ended
June 30,
 
   2019
(Unaudited)
   2018
(Unaudited)
 
Period-end MYR : US$1 exchange rate   4.13    4.04 
Period-average MYR : US$1 exchange rate   4.11    3.94 
Period-end / average HK$ : US$1 exchange rate   7.75   7.75 
XML 27 R17.htm IDEA: XBRL DOCUMENT v3.19.2
Plant and Equipment, Net (Tables)
6 Months Ended
Jun. 30, 2019
Property, Plant and Equipment [Abstract]  
Schedule of Plant and Equipment, Net

    As of
June 30, 2019
    As of
December 31, 2018
 
    (Unaudited)        
Computer and Software   $ 3,878     $ 3,878  
Equipment     1,815       1,816  
      5,693       5,694  
Less: Accumulated Depreciation     (2,964 )     (2,226 )
Plant and equipment, net   $ 2,729     $ 3,468  

XML 28 R18.htm IDEA: XBRL DOCUMENT v3.19.2
Description of Business and Organization (Details Narrative)
Sep. 30, 2018
Mr. Chen Zheru [Member]  
Acquisition percentage 100.00%
XML 29 R19.htm IDEA: XBRL DOCUMENT v3.19.2
Summary of Significant Accounting Policies (Details Narrative)
3 Months Ended 6 Months Ended
Jun. 30, 2019
USD ($)
Mar. 31, 2019
USD ($)
Jun. 30, 2018
USD ($)
[1]
Mar. 31, 2018
USD ($)
Jun. 30, 2019
USD ($)
Jun. 30, 2018
USD ($)
[1]
Jun. 30, 2019
HKD ($)
Net loss $ (66,559) $ (50,187) $ (30,649) $ (44,580) $ (116,746) $ (75,229)  
Net cash flows used in operating activities         $ (138,132) $ (88,337)  
Tax benefit likelihood percentage, description         The first step requires an entity to determine whether it is more likely than not (greater than 50% chance) that the tax position will be sustained.    
HSBC Hong Kong [Member]              
Compensation balance, description         Our deposit is currently deposit in HSBC Hong Kong, and there is a Deposit Protection Scheme protects our eligible deposits held with bank in Hong Kong which is members of the Scheme. The scheme will pay us a compensation up to a limit of HKD500,000, which is equivalent to $64,102, if HSBC Hong Kong fails.    
Compensation balance, amount $ 64,102       $ 64,102    
Maximum [Member]              
Commercial harvesting term of biological assets         9 years    
Maximum [Member] | HKD Currency [Member]              
Compensation balance, amount             $ 500,000
Minimum [Member]              
Commercial harvesting term of biological assets         7 years    
[1] The prior year comparative information has been retrospectively stated due to the common control acquisition on September 30, 2018.
XML 30 R20.htm IDEA: XBRL DOCUMENT v3.19.2
Summary of Significant Accounting Policies - Schedule of Estimated Useful Lives of Plant and Equipment (Details)
6 Months Ended
Jun. 30, 2019
Computer and Software [Member]  
Plant and equipment useful life 3 years
Equipment [Member]  
Plant and equipment useful life 10 years
XML 31 R21.htm IDEA: XBRL DOCUMENT v3.19.2
Summary of Significant Accounting Policies - Schedule of Foreign Currency Translation (Details)
Jun. 30, 2019
Jun. 30, 2018
Period-End MYR [Member]    
Foreign Currency Exchange Rate, Translation 4.13 4.04
Period-Average MYR [Member]    
Foreign Currency Exchange Rate, Translation 4.11 3.94
Period-end / Average HK [Member]    
Foreign Currency Exchange Rate, Translation 7.75 7.75
XML 32 R22.htm IDEA: XBRL DOCUMENT v3.19.2
Prepaid Expenses (Details Narrative) - USD ($)
Jun. 30, 2019
Dec. 31, 2018
Transfer Agent [Member]    
Deposit $ 1,852 $ 1,205
Consulting Service Provider [Member]    
Deposit 6,410  
Farmland Provider [Member]    
Deposit 726 726
OTCQB Annual Fee [Member]    
Prepaid expenses $ 6,000 $ 12,000
XML 33 R23.htm IDEA: XBRL DOCUMENT v3.19.2
Plant and Equipment, Net (Details Narrative)
6 Months Ended 12 Months Ended
Jun. 30, 2019
USD ($)
Jun. 30, 2018
USD ($)
[1]
Dec. 31, 2017
USD ($)
Dec. 31, 2017
MYR (RM)
Dec. 31, 2018
USD ($)
Accumulated depreciation $ 2,964       $ 2,226
Depreciation expense 738 $ 742      
Computer Equipment [Member]          
Payments to acquire plant and equipment     $ 3,731    
Software [Member]          
Payments to acquire plant and equipment     147    
Property, Plant and Equipment [Member]          
Accumulated depreciation 2,585       1,939
Engine Pump [Member]          
Payments to acquire plant and equipment     $ 1,852    
Accumulated depreciation $ 401       $ 287
Engine Pump [Member] | MYR [Member]          
Payments to acquire plant and equipment | RM       RM 7,500  
[1] The prior year comparative information has been retrospectively stated due to the common control acquisition on September 30, 2018.
XML 34 R24.htm IDEA: XBRL DOCUMENT v3.19.2
Plant and Equipment, Net - Schedule of Plant and Equipment, Net (Details) - USD ($)
Jun. 30, 2019
Dec. 31, 2018
Property and equipment, gross $ 5,693 $ 5,694
Less: Accumulated Depreciation (2,964) (2,226)
Plant and equipment, net 2,729 3,468
Computer and Software [Member]    
Property and equipment, gross 3,878 3,878
Equipment [Member]    
Property and equipment, gross $ 1,815 $ 1,816
XML 35 R25.htm IDEA: XBRL DOCUMENT v3.19.2
Biological Assets (Details Narrative)
6 Months Ended 12 Months Ended
Jun. 30, 2019
USD ($)
Dec. 31, 2018
USD ($)
Dec. 31, 2017
USD ($)
Dec. 31, 2017
MYR (RM)
Accumulated planation development costs $ 35,510 $ 28,697    
Agarwood Sapling [Member]        
Payment to acquire biological assets     $ 24,395  
Agarwood Sapling [Member] | MYR [Member]        
Payment to acquire biological assets | RM       RM 98,800
XML 36 R26.htm IDEA: XBRL DOCUMENT v3.19.2
Amount Due to Director (Details Narrative) - USD ($)
Jun. 30, 2019
Dec. 31, 2018
Related Party Transactions [Abstract]    
Due to Director $ 78,424 $ 66,355
XML 37 R27.htm IDEA: XBRL DOCUMENT v3.19.2
Stockholders' Equity (Details Narrative) - shares
6 Months Ended
Jun. 30, 2019
Dec. 31, 2018
Common stock, shares issued 141,965,520 141,965,520
Common stock, shares outstanding 141,965,520 141,965,520
Stock Options [Member]    
Dilutive securities outstanding  
Warrants [Member]    
Dilutive securities outstanding  
Other Potentially Dilutive Securities [Member]    
Dilutive securities outstanding  
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