Condensed financial information of the parent company

12 Months Ended

Dec. 31, 2021

Financial Information Of Parent Company

Condensed financial information of the parent company

24. Condensed financial information of the parent company

The Company performed a test on the restricted net assets of consolidated subsidiary in accordance with Securities and Exchange Commission Regulation S-X Rule 4-08(e)(3), “General Notes to Financial Statements” and concluded that it was applicable for the Company to disclose the financial statements for the parent company.

The subsidiary did not pay any dividend to the Company for the years presented. For the purpose of presenting parent only financial information, the Company records its investment in its subsidiary under the equity method of accounting. Such investment is presented on the separate condensed balance sheets of the Company as “Investment in subsidiary” and the income of the subsidiary is presented as “share of income of subsidiary”. Certain information and footnote disclosures generally included in financial statements prepared in accordance with U.S. GAAP have been condensed and omitted.

The Company did not have significant capital and other commitments, long-term obligations, or guarantees as of December 31, 2021 and 2020.

PARENT COMPANY BALANCE SHEETS 

	December 31, 2021			December 31, 2020
ASSETS
Current assets:
Cash and cash equivalents	$	8,758		$	712,894
Other receivables, net		204,400			600,000
Total current assets		213,158			1,312,894
Non-current assets:
Property, plant and equipment, net		3,937,222			4,142,620
Investment in subsidiaries		21,873,789			59,731,280
Total non-current assets		25,811,011			63,873,900
Total assets	$	26,024,169		$	65,186,794
LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES
Other payables and accrued liabilities	$	8,364,775		$	2,495,595
Other payables - related party		9,188			3,308
Short-term loans		—			2,493,239
Convertible bonds payable		—			739,189
Total current liabilities		8,373,963			5,731,331
Non-current liabilities		—			505,755
Total liabilities		8,373,963			6,237,086
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY
Ordinary shares, $0.001 par value, 100,000,000 shares authorized, 53,823,831, 38,553,694 shares issued and outstanding as of December 31, 2021, 2020 and 2020 respectively		53,824			38,554
Additional paid-in capital		36,281,992			23,466,482
Statutory reserves		2,143,252			2,204,174
Retained earnings		(25,748,542	)		31,387,398
Accumulated other comprehensive losses		2,459,256			1,741,696
Total Blue Hat Interactive Entertainment Technology shareholders’ equity		15,189,782			58,838,304
Non-controlling interest		2,460,424			111,404
Total equity		17,650,206			58,949,708
Total liabilities and shareholders' equity	$	26,024,169		$	65,186,794

PARENT COMPANY STATEMENTS OF INCOME AND COMPREHENSIVE INCOME 

	Year ended December 31,			Year ended December 31,			Year ended December 31,
	2021			2020			2019
Operating expenses:
General and administrative expenses	$	(1,169,384	)	$	(1,307,167	)	$	(1,671,700	)
Other income (expenses):
(Interest expense)/interest income		(169,366	)		(175,386	)		21
Other finance expenses		(10,442	)		(18,442	)		(1,762	)
Equity income of subsidiaries and VIEs from continue operation		(60,199,373	)		9,548,859			10,747,395
Equity income of subsidiaries and VIEs from discontinued operation		1,493,945			233,153			—
NET INCOME		(60,054,620	)		8,281,017			9,073,954
FOREIGN CURRENCY
TRANSLATION ADJUSTMENT		717,560			3,220,363			(521,738	)
COMPREHENSIVE INCOME	$	(59,337,060	)	$	11,501,380		$	8,552,216
Less: Comprehensive income attributable  to non-controlling interest		(2,918,680	)		111,404			—
Comprehensive income attributable to
Blue Hat Interactive Entertainment Technology shareholders	$	56,418,380		$	11,389,976		$	8,552,216

	Year ended			Year ended			Year ended
	December 31,			December 31,			December 31,
	2021			2020			2019
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	(60,054,620	)	$	8,281,017		$	9,073,954
Net income from discontinued operation		1,493,945			233,153			—
Net income from continuing operation		(61,548,565	)		8,047,864			9,073,954
Adjustments to reconcile net income to cash used in operating activities:
Equity income of subsidiaries and VIEs		60,199,373			(9,548,859	)		(10,747,395	)
Changes in operating assets and liabilities:
Depreciation of property and equipment		205,398			179,740			—
Other receivables		395,600			—			(600,000	)
Other payables and accrued liabilities		5,869,181			925,409			1,570,183
Net cash used in operating activities		5,120,987			(395,846	)		(703,258	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment		—			(2,159,910	)		(2,162,449	)
Investment in subsidiary		(14,923,600	)		(7,660,000	)		—
Net cash used in investing activities		(14,923,600	)		(9,819,910	)		(2,162,449	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issue of new shares		—			2,110,845			—
Proceeds from secured convertible promissory note Bonds		—			739,189			—
Underwriter’s partial exercise of over-allotment option, net of issuance costs		12,830,780			—			524,944
Proceeds from initial public offering, net of issuance costs		—			—			7,417,077
Other payables   related party		5,880			3,039			269
Proceeds from short-term loans		—			2,998,994			—
Repayment of short-term loans		(2,998,994	)		—			—
Repayment of convertible payables		(739,189	)		—			—
Net cash used in investing activities		9,098,477			5,852,067			7,942,290
EFFECT OF EXCHANGE RATE ON CASH		—			—			—
NET CHANGES IN CASH AND CASH EQUIVALENTS		(704,136	)		(4,363,689	)		5,076,583
CASH AND CASH EQUIVALENTS, Beginning of year		712,894			5,076,583			—
CASH AND CASH EQUIVALENTS, end of year	$	8,758		$	712,894		$	5,076,583
SUPPLEMENTAL CASH FLOW
INFORMATION:
Cash and cash equivalents	$	8,758		$	712,894		$	76,583
Restricted cash		—			—			5,000,000
CASH AND CASH EQUIVALENTS, end of year	$	8,758		$	712,894		$	5,076,583