UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
OF THE SECURITIES EXCHANGE ACT OF 1934
For
The Quarterly Period Ended
or
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _______________ to _______________
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☒ NO ☐
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Indicate by check mark whether the registrant has fled 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.
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☐
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 October 31, 2021 | |||
| Common Stock, $.0001 par value | ||||
TABLE OF CONTENTS
| 2 |
PART I FINANCIAL INFORMATION
ITEM 1. UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS:
PHOENIX PLUS CORP.
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
| F-1 |
PHOENIX PLUS CORP.
CONDENSED CONSOLIDATED BALANCE SHEETS
AS OF OCTOBER 31, 2021 AND JULY 31, 2021
(Currency expressed in United States Dollars (“US$”), except for number of shares)
| As of | As of | |||||||
| October 31, 2021 | July 31, 2021 | |||||||
| Unaudited | Audited | |||||||
| ASSETS | ||||||||
| CURRENT ASSETS | ||||||||
| Trade receivables | $ | $ | ||||||
| Prepayment and deposits | ||||||||
| Cash in bank | ||||||||
| Total Current Assets | $ | $ | ||||||
| NON-CURRENT ASSETS | ||||||||
| Lease asset- right of use | $ | $ | ||||||
| Equity method investment | - | |||||||
| TOTAL ASSETS | ||||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| NON-CURRENT LIABILITIES | ||||||||
| Lease liabilities, non-current | ||||||||
| CURRENT LIABILITIES | ||||||||
| Account payable | ||||||||
| Others payables and accrued liabilities | ||||||||
| Lease liabilities, current | ||||||||
| Total Current Liabilities | $ | $ | ||||||
| TOTAL LIABILITIES | $ | $ | ||||||
| STOCKHOLDERS’ EQUITY | ||||||||
| Preferred stock, $ par value; shares authorized; issued and outstanding | - | - | ||||||
| Common Shares, par value $; shares authorized, shares issued and outstanding as of October 31, 2021 and July 31, 2021 | $ | $ | ||||||
| Additional paid in capital | ||||||||
| Accumulated other comprehensive profit | - | - | ||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| TOTAL STOCKHOLDERS’ EQUITY | $ | $ | ||||||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | $ | ||||||
See accompanying notes to condensed consolidated financial statements.
| F-2 |
PHOENIX PLUS CORP.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSSES
FOR THE THREE MONTHS ENDED OCTOBER 31, 2021 and 2020
(Currency expressed in United States Dollars (“US$”), except for number of shares)
(Unaudited)
Three months ended October 31, 2021 (Unaudited) | Three months ended October 31, 2020 (Unaudited) | |||||||
| REVENUE | $ | $ | ||||||
| COST OF REVENUE | ( | ) | ( | ) | ||||
| GROSS PROFIT | ||||||||
| OTHER INCOME | ||||||||
| SELLING AND DISTRIBUTION EXPENSES | - | ( | ) | |||||
| EQUITY METHOD LOSS | ( | ) | - | |||||
| GENERAL AND ADMINISTRATIVE EXPENSES | ( | ) | ( | ) | ||||
| LOSS BEFORE INCOME TAX | ( | ) | $ | ( | ) | |||
| INCOME TAXES PROVISION | - | - | ||||||
| NET LOSS | ( | ) | ( | ) | ||||
| Net Loss attributable to Non-Controlling Interests | ||||||||
| Other comprehensive income/(loss): | ||||||||
| - Foreign exchange adjustment gain/(loss) | - | - | ||||||
| COMPREHENSIVE LOSS | $ | ( | ) | $ | ( | ) | ||
| Net loss per share- Basic and diluted | ( | ) | ( | ) | ||||
| Weighted average number of common shares outstanding - Basic and diluted | ||||||||
See accompanying notes to condensed consolidated financial statements.
| F-3 |
PHOENIX PLUS CORP.
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
FOR THE THREE MONTHS ENDED OCTOBER 31, 2021 and 2020
(Currency expressed in United States Dollars (“US$”), except for number of shares)
(Unaudited)
Three Months Ended October 31, 2021 (Unaudited) |
| COMMON SHARES | ADDITIONAL | ACCUMULATED OTHER | ||||||||||||||||||||||
| Number of Shares | Amount | PAID-IN CAPITAL | COMPREHENSIVE INCOME | ACCUMULATED DEFICIT | TOTAL EQUITY | |||||||||||||||||||
| Balance as of July 31, 2021 | $ | $ | $ | $ | ( | ) | $ | |||||||||||||||||
| Net loss for the period | - | - | ( | ) | ( | ) | ||||||||||||||||||
| Balance as of October 31,2021 | ( | ) | ||||||||||||||||||||||
Three Months Ended October 31, 2020 (Unaudited) |
| COMMON SHARES | ADDITIONAL | ACCUMULATED OTHER | ||||||||||||||||||||||
| Number of Shares | Amount | PAID-IN CAPITAL | COMPREHENSIVE INCOME | ACCUMULATED DEFICIT | TOTAL EQUITY | |||||||||||||||||||
| Balance as of July 31, 2020 | $ | $ | $ | $ | ( | ) | $ | |||||||||||||||||
| Net loss for the period | - | - | ( | ) | ( | ) | ||||||||||||||||||
| Balance as of October 31, 2020 | ( | ) | ||||||||||||||||||||||
See accompanying notes to condensed consolidated financial statements.
| F-4 |
PHOENIX PLUS CORP.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED OCTOBER 31, 2021 and 2020
(Currency expressed in United States Dollars (“US$”), except for number of shares)
(Unaudited)
| Three months ended October 31 | ||||||||
| 2021 | 2020 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Equity method investment loss | ||||||||
| Depreciation | ||||||||
| Operating lease expenses | ||||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivables | ( | ) | ||||||
| Other receivables and prepayment | ||||||||
| Accounts payable | ( | ) | ( | ) | ||||
| Other payables and accrued liabilities | ( | ) | ||||||
| Amount due to related parties | ||||||||
| Operating lease liabilities | ( | ) | ( | ) | ||||
| Net cash (used) and generate from operating activities | ( | ) | ||||||
| Effect of exchange rate changes on cash and cash equivalents | $ | |||||||
| Net (decrease)/increase in cash and cash equivalents | ( | ) | ||||||
| Cash and cash equivalents, beginning of year | ||||||||
| CASH AND CASH EQUIVALENTS, END OF YEAR | $ | |||||||
| SUPPLEMENTAL CASH FLOWS INFORMATION | ||||||||
| Income taxes paid | $ | $ | ||||||
| Interest paid | $ | $ | ||||||
See accompanying notes to condensed consolidated financial statements.
| F-5 |
PHOENIX PLUS CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED OCTOBER 31, 2021
(Currency expressed in United States Dollars (“US$”), except for number of shares)
(UNAUDITED)
1. DESCRIPTION OF BUSINESS AND ORGANIZATION
Phoenix Plus Corp. was incorporated on November 5, 2018 under the laws of the state of Nevada.
The Company, through its subsidiaries, engaged in providing technical consultancy on solar power system and consultancy on green energy solution, and also focused on the commercialization of a targeted portfolio of solar products (amorphous thin film solar panels and ancillary products) and technologies for a wide range of applications including electrical power production.
On
March 18, 2019, the Company acquired
On July 25, 2019, Phoenix Plus Corp., a Malaysia Company acquired Phoenix Plus International Limited (herein referred as the “Hong Kong Company”), a private limited company incorporated in Hong Kong.
Details of the Company’s subsidiaries:
| Company name | Place and date of incorporation | Particulars of issued capital | Principal activities | |||||
| 1. | ||||||||
| 2. | ||||||||
| F-6 |
PHOENIX PLUS CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED OCTOBER 31, 2021
(Currency expressed in United States Dollars (“US$”), except for number of shares)
(UNAUDITED)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of presentation
The consolidated financial statements for Phoenix Plus Corp. and its subsidiaries. For the period ended October 31, 2021 is prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) and include the accounts of Phoenix Plus Corp. and its wholly owned subsidiaries, Phoenix Plus Corp. and Phoenix Plus International Limited. Intercompany accounts and transactions have been eliminated on consolidation. The Company has adopted July 31 as its fiscal year end.
Basis of consolidation
The consolidated financial statements include the accounts of the Company and its subsidiaries. All inter-company accounts and transactions have been eliminated upon consolidation.
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 sheets, and the reported revenue and expenses during the periods reported. Actual results may differ from these estimates.
Revenue recognition
In accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts. ASC 606 creates a five-step model that requires entities to exercise judgment when considering the terms of contracts, which includes (1) identifying the contracts or agreements with a customer, (2) identifying our performance obligations in the contract or agreement, (3) determining the transaction price, (4) allocating the transaction price to the separate performance obligations, and (5) recognizing revenue as each performance obligation is satisfied. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the services it transfers to its clients.
Revenue is measured at the fair value of the consideration received or receivable, net of discounts and taxes applicable to the revenue. The Company derives its revenue from provision of technical consultancy on solar power system and consultancy on green energy solution.
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.
Investment under equity method
The Company apply the equity method to account for investments it possesses the ability to exercise significant influence, but not control, over the operating and financial policies of the investee. The ability to exercise significant influence is presumed when the investor possesses more than 20% of the voting interests of the investee.
In applying the equity method, the Company records the investment at cost and subsequently increase or decrease the carrying amount of the investment by proportionate share of the net earnings or losses and other comprehensive income of the investee. The Company records dividends or other equity distributions as reductions in the carrying value of the investment.
| F-7 |
PHOENIX PLUS CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED OCTOBER 31, 2021
(Currency expressed in United States Dollars (“US$”), except for number of shares)
(UNAUDITED)
Income taxes
Income taxes are determined in accordance with the provisions of ASC Topic 740, “Income Taxes” (“ASC Topic 740”). Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the periods in which those temporary differences are expected to be recovered or settled. Any 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.
ASC
740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements
uncertain tax positions taken or expected to be taken on a tax return. Under ASC 740, tax positions must initially be recognized in the
financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities.
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. As reflected in the accompanying financial statements, for the period
ended October 31, 2021, the Company incurred a net loss of $
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. 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 stock holders, in the case of equity financing.
| F-8 |
PHOENIX PLUS CORP
NOTES TO CONDENSED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED OCTOBER 31, 2021
(Currency expressed in United States Dollars (“US$”), except for number of shares)
(UNAUDITED)
The Company calculates net loss per share in accordance with ASC Topic 260, “Earnings per Share.” Basic loss per share is computed by dividing the net loss by the weighted-average number of common shares outstanding during the period. Diluted income per share is computed similar to basic loss per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common stock equivalents had been issued and if the additional common shares were dilutive.
Foreign currencies translation
Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the statements of operations.
The reporting currency of the Company is United States Dollars (“US$”). The Company’s subsidiary in Labuan and Hong Kong maintains its books and record in United States Dollars (“US$”) respectively, and Ringgits Malaysia (“MYR”) is functional currency as being the primary currency of the economic environment in which the entity operates.
In general, for consolidation purposes, assets and liabilities of its subsidiary whose functional currency is not the US$ are translated into US$, in accordance with ASC Topic 830-30, “Translation of Financial Statement”, using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements of foreign subsidiary are recorded as a separate component of accumulated other comprehensive income within the statement of stockholders’ equity.
Translation of amounts from MYR into US$1 and HK$ into US$1 has been made at the following exchange rates for the respective periods:
| As of and for the period ended October 31, 2021 | As of and for the period ended October 31, 2020 | |||||||
| Period-end RM : US$1 exchange rate | ||||||||
| Period-average RM : US$1 exchange rate | ||||||||
| Period-end HK$: US$1 exchange rate | ||||||||
| Period-average HK$ : US$1 exchange rate | ||||||||
Related parties
Parties, which can be a corporation or individual, are considered to be related if the Company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Companies are also considered to be related if they are subject to common control or common significant influence.
| F-9 |
PHOENIX PLUS CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED OCTOBER 31, 2021
(Currency expressed in United States Dollars (“US$”), except for number of shares)
(UNAUDITED)
Fair value of financial instruments:
The carrying value of the Company’s financial instruments: cash and cash equivalents, prepayment, deposits, accounts payable and accrued liabilities and amount due to a director approximate at their fair values because of the short-term nature of these financial instruments.
The Company also 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.
Leases
Prior to August 1, 2019, the Company accounted for leases under ASC 840, Accounting for Leases. Effective August 1, 2019, the Company adopted the guidance of ASC 842, Leases, which requires an entity to recognize a right-of-use asset and a lease liability for virtually all leases. The implementation of ASC 842 did not have a material impact on the Company’s consolidated financial statements and did not have a significant impact on our liquidity. The Company adopted ASC 842 using a modified retrospective approach. As a result, the comparative financial information has not been updated and the required disclosures prior to the date of adoption have not been updated and continue to be reported under the accounting standards in effect for those periods. (see Note 11).
Recent accounting pronouncements
ASB issues various Accounting Standards Updates relating to the treatment and recording of certain accounting transactions. On June 10, 2014, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2014-10, Development Stage Entities (Topic 915) Elimination of Certain Financial Reporting Requirements, including an Amendment to Variable Interest Entities Guidance in Topic 810, Consolidation, which eliminates the concept of a development stage entity (DSE) entirely from current accounting guidance. The Company has elected adoption of this standard, which eliminates the designation of DSEs and the requirement to disclose results of operations and cash flows since inception.
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.
| F-10 |
PHOENIX PLUS CORP
NOTES TO CONDENSED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED OCTOBER 31, 2021
(Currency expressed in United States Dollars (“US$”), except for number of shares)
(UNAUDITED)
3. COMMON STOCK
On
November 5, 2018, the Company issued shares of restricted common stock, with a par value of $ per share, to Mr. Fong Teck
Kheong for initial working capital of $
On
March 25, 2019, the Company issued shares of restricted common stock, with a par value of $ per share, to Mr. Fong
Teck Kheong for additional working capital of $
Between
March 28, 2019 to April 1, 2019, the Company issued shares of restricted common stock to 5 parties, with a par value of $
per share, for total additional working capital of $
On
April 1, 2019, the Company issued shares of restricted common stock to AGAPE ATP Corporation a company incorporated in Nevada
with a par value of $ per share, for additional working capital of $
On
April 1, 2019, the Company issued shares of restricted common stock, with a par value of $ per share, to H&D Holding
Sdn Bhd, a company incorporated in Malaysia, for additional working capital of $
Between
April 9, 2019 to April 16, 2019, the Company issued shares of restricted common stock to Junsei Ryu, Lee Chong Chow and Phoenix
Plus Holding Sdn Bhd with a par value of $ per share, for additional working capital of $
Between
April 25, 2019 to May 10, 2019, the Company sold shares to 19 foreign individuals, whom all reside in Malaysia. A total of
shares of restricted common stock were sold at a price of $ per share. The total proceeds to the Company amounted to a total of $
Between
May 11, 2019 to June 18, 2019, the Company sold shares to 23 foreign parties whom resides in Malaysia. A total of shares of
restricted common stock were sold at a price of $ per share. The total proceeds to the Company amounted to $
Between
May 20, 2019 to July 25,2019, the Company sold shares to 15 foreign parties , all of which do not reside in the United States. A total
of shares of restricted common stock were sold at a price of $ per share. The total proceeds to the Company amounted to
a total of $
On
July 9, 2021, the company has issued free trade common share of the company at a $ per share for a total consideration of $
As of October 31, 2021, the Company has an issued and outstanding common share of .
4. PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment as of October 31, 2021 are summarized below:
As of October 31, 2021 (unaudited) | As of July 31, 2021 (audited) | |||||||
| Leasehold improvement | $ | - | $ | |||||
| Accumulated depreciation | - | ( | ) | |||||
| Total | $ | $ | ||||||
These leasehold improvement include, but are not strictly limited to, preparing the interior of the office space for the Company’s use, improving functionality, and purchasing new office equipment. The leasehold improvement have completed on September 2019.
Depreciation
expense for the period ended October 31, 2021 and October 31, 2020 was $ and $
5. PREPAYMENT AND DEPOSITS
Prepayments and deposits consisted of the following at October 31, 2021 and July 31, 2021:
As of October 31, 2021 (unaudited) | As of July 31, 2021 (audited) | |||||||
| Subscription receivable | $ | $ | ||||||
| Deposits | ||||||||
| Prepayment | ||||||||
| Total prepayments and deposits | $ | $ | ||||||
6. TRADE PAYABLE
Trade payable consisted of the following at October 31, 2021 and July 31, 2021:
As of October 31, 2021 (unaudited) | As of July 31, 2021 (audited) | |||||||
| Trade payable | $ | $ | ||||||
| Total trade payable | $ | $ | ||||||
7. EQUITY METHOD INVESTMENT
The Company hold investment in business that is accounted for pursuant to the equity method due to the Company’s ability to exert significant influence over decisions relating to their operating and financial affairs. Revenue and expenses of this investment are not consolidated into the Company’s financial statements; rather, the proportionate share of the earnings/losses is reflected as equity method earnings/losses in statements of operations and comprehensive income/loss.
During
the three months period ended October 31, 2021 and 2020, the Company accounted USD
8. OTHER PAYABLES AND ACCRUED LIABILITIES
Other payables and accrued liabilities consisted of the following at October 31, 2021 and July 31, 2021:
As of October 31, 2021 | As of July 31, 2021 | |||||||
| Accrued audit fees | $ | $ | ||||||
| Accrued expenses | $ | $ | ||||||
| Total other payables and accrued liabilities | $ | $ | ||||||
| F-11 |
PHOENIX PLUS CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED OCTOBER 31, 2021
(Currency expressed in United States Dollars (“US$”), except for number of shares)
(UNAUDITED)
9. REVENUE
For the period ended October 31, 2021 and 2020 the Company has revenue arise from the following:
Three months period ended October 31, 2021 (Unaudited) | Three months period ended October 31, 2020 (Unaudited) | |||||||
| Consultancy service provided | $ | $ | ||||||
| Total revenue | $ | $ | ||||||
10. OTHER INCOME
For the period ended October 31, 2021 and 2020 the Company has other income arise from the following:
Three months period ended October 31, 2021 (Unaudited) | Three months period ended October 31, 2020 (Unaudited) | |||||||
| Gain from foreign exchange arise from bank remittance transaction: | $ | $ | ||||||
| Local | ||||||||
| Foreign, representing | ||||||||
| -Labuan | ||||||||
| -Hong Kong | ||||||||
| $ | $ | |||||||
11. INCOME TAXES
For the period ended October 31, 2021 the local (United States) and foreign components of income/(loss) before income taxes were comprised of the following:
Three months ended October 31, 2021 (Unaudited) | Three months ended October 31, 2020 (Unaudited) | |||||||
| Tax jurisdictions from: | ||||||||
| Local | $ | ( | ) | $ | ( | ) | ||
| Foreign, representing | ||||||||
| - Labuan | ||||||||
| - Hong Kong | $ | ( | ) | $ | ( | ) | ||
| Loss before income tax | $ | ( | ) | $ | ( | ) | ||
The provision for income taxes consisted of the following:
For the period ended October 31, 2021 | For the period ended October 31, 2020 | |||||||
| Current: | ||||||||
| - Local | ||||||||
| - Foreign | ||||||||
| Deferred: | ||||||||
| - Local | ||||||||
| - Foreign | ||||||||
| Income tax expense | $ | $ |
Income taxes are determined in accordance with the provisions of ASC Topic 740, “Income Taxes” (“ASC Topic 740”). Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the year in which those temporary differences are expected to be recovered or settled. Any effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the year that includes the enactment date.
The effective tax rate in the periods presented is the result of the mix of income earned in various tax jurisdictions that apply a broad range of income tax rates. The Company has subsidiaries that operate in various countries: United States, Labuan and Hong Kong that are subject to taxes in the jurisdictions in which they operate, as follows:
United States of America
The
Company is registered in the State of Nevada and is subject to the tax laws of the United States of America. As of October 31, 2021 the
operations in the United States of America incurred $
Labuan
Under
the current laws of the Labuan, Phoenix Plus Corp.is governed under the Labuan Business Activity Act, 1990. The tax charge for such company
is based on
Hong Kong
Phoenix
Plus International Limited is subject to Hong Kong Profits Tax, which is charged at the statutory income rate of
| F-12 |
PHOENIX PLUS CORP.
NOTES TO CONDENSED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED OCTOBER 31, 2021
(Currency expressed in United States Dollars (“US$”), except for number of shares)
(UNAUDITED)
12. LEASE RIGHT-OF-USE ASSET AND LEASE LIABILITIES
The Company officially adopted ASC 842 for the year on and after August 1, 2019 as permitted by ASU 2016-02. ASC 842 originally required all entities to use a “modified retrospective” transition approach that is intended to maximize comparability and be less complex than a full retrospective approach. On July 30, 2018, the FASB issued ASU 2018-11 to provide entities with relief from the costs of implementing certain aspects of the new leasing standard, ASU 2016-02 of which permits entities may elect not to recast the comparative years presented when transitioning to ASC 842. As permitted by ASU 2018-11, the Company elect not to recast comparative years, thusly.
As
of July 1, 2021, the Company recognized approximately US$
A single lease cost is recognized over the lease term on a generally straight-line basis. All cash payments of operating lease cost are classified within operating activities in the statement of cash flows.
The initial recognition of operating lease right and lease liability as follow:
| Gross lease payable | $ | |||
| Less: imputed interest | ( | ) | ||
| Initial recognition as of July 1, 2021 | $ |
As of October 31, 2021 operating lease right of use asset as follow:
| Initial recognition as of August 1, 2019 | $ | |||
| Additional portion from 1 July 31, 2020 to 30 June 2021 | ||||
| Add: new lease addition from 1 July 2021 to 30 June 2023 | ||||
| Accumulated amortization | ( | ) | ||
| Foreign exchange translation gain | ||||
| Balance as of October 31, 2021 | $ |
As of October 31, 2021, operating lease liability as follow:
| Initial recognition as of August 1, 2019 | $ | |||
| Add: additional portion (increase of leasing fee) | ||||
| Add: new lease addition from 1 July 2021 to 30 June 2023 | ||||
| Less: gross repayment | ( | ) | ||
| Add: imputed interest | ||||
| Foreign exchange translation loss | ||||
| Balance as of October 31, 2021 | $ | |||
| Less: lease liability current portion | ( | ) | ||
| Lease liability non-current portion | $ |
For
the period ended October 31, 2021, the amortization of the operating lease right of use asset are $
Maturities of operating lease obligation as follow:
| Year ending | ||||
| October 31, 2022 (12 months) | $ | |||
| July 30, 2023 (8 months) | ||||
| Total | $ | |||
Other information:
| Period ended October 31 | ||||||||
| 2021 | 2020 | |||||||
| (Unaudited) | (Unaudited) | |||||||
| Cash paid for amounts included in the measurement of lease liabilities: | ||||||||
| Operating cash flow from operating lease | $ | $ | ||||||
| Right-of-use assets obtained in exchange for operating lease liabilities | ||||||||
| Remaining lease term for operating lease (years) | ||||||||
| Weighted average discount rate for operating lease | % | % | ||||||
Lease
expenses were $
13. SIGNIFICANT EVENTS
During the fiscal year, the World Health Organization declared the Coronavirus (COVID-19) outbreak to be a pandemic, which has caused severe global social and economic disruptions and uncertainties, including markets where the Company operates. The consequences brought about by Covid-19 continue to evolve and whilst the Company actively monitoring and managing its operations to respond to these changes, the Company does not consider it practicable to provide any quantitative estimate on the potential impact it may have on the Company.
14. SUBSEQUENT EVENTS
The Company has evaluated subsequent events from the balance sheet date through October 31, 2021 the date the Company issued unaudited consolidated financial statements in accordance with ASC Topic 855, “Subsequent Events”, which establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued. During this period, there was no subsequent event that required recognition or disclosure.
| F-13 |
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 October 31, 2021, for the year ended July 31, 2021 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 10-K. The following discussion and analysis also should be read together with our consolidated financial statements and the notes to the consolidated 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 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
Phoenix Plus Corp., a Nevada Corporation, is a company that operates through its wholly owned subsidiary, Phoenix Plus Corp., a Company organized in Labuan, Malaysia. It should be noted that our wholly owned subsidiary, Phoenix Plus Corp., owns 100% of Phoenix Plus International Limited, the operating Hong Kong Company which is described below. All of the previous entities share the same exact business plan.
We have a physical office in Malaysia with address of 2-3 & 2-5 Bedford Business Park, Jalan 2/137B, Batu 5, Jalan Kelang Lama, 58200 Kuala Lumpur, Malaysia which completed renovation in September 2019. The office space is 12,000 square feet and to date the company has spent $114,263 towards ongoing renovations. These renovations include, but are not strictly limited to, preparing the interior of the office space for the Company’s use, improving functionality, and purchasing new office equipment. Our office space is rented by Phoenix Plus International Limited for a 12 month period from July 1, 2019 to June 30, 2023, for an initial down payment of MYR 13,500 and additional bi-monthly payments in the amount of MYR 6,500 over the course of the lease. The Company has an option to renew the tenancy for another 12 months period at a rental subject to mutual agreement with the landlord
Phoenix Plus Corp, through its Hong Kong subsidiary, is engaged in providing technical consultancy on solar power systems and consultancy on green energy solutions, with an additional focus on the commercialization of a targeted portfolio of solar products (amorphous thin film solar panels and ancillary products) and technologies for a wide range of applications including electrical power production. Our mission is to harness the power of the sun to meet the growing resource demands of sustainable 21st century development.
Our business is to market and sell solar power products, systems and services. Specifically, we intend to engage in the following:
| ● | Install solar panels in both commercial and residential settings; and |
| ● | Develop and maintain solar parks. |
| 3 |
Results of Operation
For the three months ended October 31, 2021 and 2020
Revenues
For the three months ended October 31, 2021 and 2020, the Company has generated revenue of $19,918 and $14,193 respectively. The revenue represented income from consultancy services provided to our customers on engineering, equipment procurement and transportation, and construction on solar plant.
Cost of Revenue and Gross Margin
For the three months ended October 31, 2021 and 2020, cost incurred arise in providing consultancy services are $16,328 and $9,067 respectively. The company generates a gross profit for the three months ended October 31, 2021 and 2020 of $3,590 and $5,126.
Selling and marketing expenses
For the three months ended October 31, 2021 and 2020, we had incurred selling and marketing expenses in the amount of $0 and $5,625. These expenses comprised of marketing events and conference to promote the company in Malaysia.
General and administrative expenses
For the three months ended October 31, 2021 and 2020, we had incurred general and administrative expenses in the amount of $69,412 and $56,400. These expenses are comprised of professional fees, listing consultancy fees, office and outlet operation expenses and depreciation.
Other Income
The Company recorded an amount of $35,153 and $21,558 as other income for the three months ended October 31, 2021 and 2020. This income is derived from the interest income and foreign exchange gain.
Net Loss
Our net loss for three months ended October 31, 2021 and 2020 were $30,669 and $35,341. The net loss mainly derived from the general and administrative, and selling and marketing expenses incurred.
| 4 |
Liquidity and Capital Resources
As of October 31, 2021 and 2020, we had cash and cash equivalents of $1,878,176 and $1,512,319. We expect increased levels of operations going forward will result in more significant cash flow and in turn working.
We depend substantially on financing activities to provide us with the liquidity and capital resources we need to meet our working capital requirements and to make capital investments in connection with ongoing operations. During the three months ended October 31, 2021, we have met these requirements primarily from the receipt of subscription for private placement shares.
Cash Used and Generated By Operating Activities
For the three months ended October 31, 2021 and 2020, net cash used and generate from operating activities was $32,696 and $104,271 respectively. The increase in cash used in operating activities was mainly for payment of general and administrative expenses, and selling and marketing expenses.
Cash Provided By Financing Activities
For the three months ended October 31, 2021 and 2020, net cash provided by financing activities was $0 and $0. The financing cash flow performance primarily reflects sale of common stock and collection of subscription receivables.
Cash Used In Investing Activities
For the three months ended October 31, 2021 and 2020, the net cash used in investing activities was $0 and $0. The cash used in investing activities was primarily due to subscription receivable that is related to the business investment.
Credit Facilities
We do not have any credit facilities or other access to bank credit.
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 October 31, 2021.
Recent Accounting Pronouncements
The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.
| 5 |
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 October 31, 2021. This evaluation was carried out under the supervision and with the participation of our Chief Executive Officer and our Chief Investment Officer. Based upon that evaluation, our Chief Executive Officer and Chief Investment Officer concluded that, as of October 31, 2021, 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 October 31, 2021, 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 ended October 31, 2021, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
| 6 |
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 1A. Risk Factors.
We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.
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
| 7 |
ITEM 6. Exhibits
| Exhibit No. | Description | |
| 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 * | |
| 101.INS | Inline XBRL Instance Document* | |
| 101.SCH | Inline XBRL Schema Document* | |
| 101.CAL | Inline XBRL Calculation Linkbase Document* | |
| 101.DEF | Inline XBRL Definition Linkbase Document* | |
| 101.LAB | Inline XBRL Label Linkbase Document* | |
| 101.PRE | Inline XBRL Presentation Linkbase Document* | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
* Filed herewith.
| 8 |
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.
| Phoenix Plus Corp. | ||
| (Name of Registrant) | ||
| Date: December 15, 2021 | ||
| By: | /s/ FONG TECK KHEONG | |
| Title: | Chief Executive Officer, President, Director, Secretary and Treasurer | |
| 9 |
EXHIBIT 31.1
CERTIFICATION
I, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Phoenix Plus Corp (the “Company”) for the quarter ended October 31, 2021;
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: December 15, 2021 | By: | /s/ FONG TECK KHEONG |
| FONG TECK KHEONG | ||
Chief Executive Officer, President, Director, Secretary, Treasurer |
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 PHOENIX PLUS CORP. (the “Company”) on Form 10-Q for the quarter ended October 31, 2021 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: December 15, 2021 | By: | /s/ FONG TECK KHEONG |
| FONG TECK KHEONG | ||
| Chief Executive Officer, | ||
| President, Director, Secretary, Treasurer |
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.
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares |
Oct. 31, 2021 |
Jul. 31, 2021 |
|---|---|---|
| Statement of Financial Position [Abstract] | ||
| Preferred stock, par value | $ 0.0001 | $ 0.0001 |
| Preferred stock, shares authorized | 200,000,000 | 200,000,000 |
| Preferred stock, shares issued | 0 | 0 |
| Preferred stock, shares outstanding | 0 | 0 |
| Common stock, par value | $ 0.0001 | $ 0.0001 |
| Common stock, shares authorized | 1,000,000,000 | 1,000,000,000 |
| Common stock, shares issued | 332,699,500 | 332,699,500 |
| Common stock, shares outstanding | 332,699,500 | 332,699,500 |
Condensed Consolidated Statements of Operations and Comprehensive Losses (Unaudited) - USD ($) |
3 Months Ended | |
|---|---|---|
Oct. 31, 2021 |
Oct. 31, 2020 |
|
| Income Statement [Abstract] | ||
| REVENUE | $ 19,918 | $ 14,193 |
| COST OF REVENUE | (16,328) | (9,067) |
| GROSS PROFIT | 3,590 | 5,126 |
| OTHER INCOME | 35,153 | 21,558 |
| SELLING AND DISTRIBUTION EXPENSES | (5,625) | |
| EQUITY METHOD LOSS | (58) | |
| GENERAL AND ADMINISTRATIVE EXPENSES | (69,354) | (56,400) |
| LOSS BEFORE INCOME TAX | (30,669) | (35,341) |
| INCOME TAXES PROVISION | ||
| NET LOSS | (30,669) | (35,341) |
| Net Loss attributable to Non-Controlling Interests | ||
| Other comprehensive income/(loss): | ||
| - Foreign exchange adjustment gain/(loss) | ||
| COMPREHENSIVE LOSS | $ (30,669) | $ (35,341) |
| Net loss per share- Basic and diluted | $ (0.00) | $ (0.00) |
| Weighted average number of common shares outstanding - Basic and diluted | 332,699,500 | 331,917,500 |
Condensed Consolidated Statements of Changes In Equity (Unaudited) - USD ($) |
Common Stock [Member] |
Additional Paid-in Capital [Member] |
AOCI Attributable to Parent [Member] |
Retained Earnings [Member] |
Total |
|---|---|---|---|---|---|
| Beginning balance, value at Jul. 31, 2020 | $ 33,192 | $ 2,463,308 | $ (812,445) | $ 1,684,055 | |
| Beginning balance, shares at Jul. 31, 2020 | 331,917,500 | ||||
| Net loss for the period | (35,341) | (35,341) | |||
| Ending balance, value at Oct. 31, 2020 | $ 33,192 | 2,463,308 | (847,786) | 1,648,714 | |
| Ending balance, shares at Oct. 31, 2020 | 331,917,500 | ||||
| Beginning balance, value at Jul. 31, 2021 | $ 33,270 | 3,245,230 | (1,150,796) | 2,127,704 | |
| Beginning balance, shares at Jul. 31, 2021 | 332,699,500 | ||||
| Net loss for the period | (30,669) | (30,669) | |||
| Ending balance, value at Oct. 31, 2021 | $ 33,270 | $ 3,245,230 | $ (1,181,465) | $ 2,097,035 | |
| Ending balance, shares at Oct. 31, 2021 | 332,699,500 |
DESCRIPTION OF BUSINESS AND ORGANIZATION |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Oct. 31, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||
| Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||
| DESCRIPTION OF BUSINESS AND ORGANIZATION | 1. DESCRIPTION OF BUSINESS AND ORGANIZATION
Phoenix Plus Corp. was incorporated on November 5, 2018 under the laws of the state of Nevada.
The Company, through its subsidiaries, engaged in providing technical consultancy on solar power system and consultancy on green energy solution, and also focused on the commercialization of a targeted portfolio of solar products (amorphous thin film solar panels and ancillary products) and technologies for a wide range of applications including electrical power production.
On March 18, 2019, the Company acquired 100% of the equity interests in Phoenix Plus Corp. (herein referred as the “Malaysia Company”), a private limited company incorporated in Labuan, Malaysia.
On July 25, 2019, Phoenix Plus Corp., a Malaysia Company acquired Phoenix Plus International Limited (herein referred as the “Hong Kong Company”), a private limited company incorporated in Hong Kong.
Details of the Company’s subsidiaries:
PHOENIX PLUS CORP. NOTES TO CONDENSED FINANCIAL STATEMENTS FOR THE THREE MONTHS ENDED OCTOBER 31, 2021 (Currency expressed in United States Dollars (“US$”), except for number of shares) (UNAUDITED)
|
|||||||||||||||||||||||||||||||||||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Oct. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of presentation
The consolidated financial statements for Phoenix Plus Corp. and its subsidiaries. For the period ended October 31, 2021 is prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) and include the accounts of Phoenix Plus Corp. and its wholly owned subsidiaries, Phoenix Plus Corp. and Phoenix Plus International Limited. Intercompany accounts and transactions have been eliminated on consolidation. The Company has adopted July 31 as its fiscal year end.
Basis of consolidation
The consolidated financial statements include the accounts of the Company and its subsidiaries. All inter-company accounts and transactions have been eliminated upon consolidation.
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 sheets, and the reported revenue and expenses during the periods reported. Actual results may differ from these estimates.
Revenue recognition
In accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts. ASC 606 creates a five-step model that requires entities to exercise judgment when considering the terms of contracts, which includes (1) identifying the contracts or agreements with a customer, (2) identifying our performance obligations in the contract or agreement, (3) determining the transaction price, (4) allocating the transaction price to the separate performance obligations, and (5) recognizing revenue as each performance obligation is satisfied. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the services it transfers to its clients.
Revenue is measured at the fair value of the consideration received or receivable, net of discounts and taxes applicable to the revenue. The Company derives its revenue from provision of technical consultancy on solar power system and consultancy on green energy solution.
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.
Investment under equity method
The Company apply the equity method to account for investments it possesses the ability to exercise significant influence, but not control, over the operating and financial policies of the investee. The ability to exercise significant influence is presumed when the investor possesses more than 20% of the voting interests of the investee.
In applying the equity method, the Company records the investment at cost and subsequently increase or decrease the carrying amount of the investment by proportionate share of the net earnings or losses and other comprehensive income of the investee. The Company records dividends or other equity distributions as reductions in the carrying value of the investment.
PHOENIX PLUS CORP. NOTES TO CONDENSED FINANCIAL STATEMENTS FOR THE THREE MONTHS ENDED OCTOBER 31, 2021 (Currency expressed in United States Dollars (“US$”), except for number of shares) (UNAUDITED)
Income taxes
Income taxes are determined in accordance with the provisions of ASC Topic 740, “Income Taxes” (“ASC Topic 740”). Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the periods in which those temporary differences are expected to be recovered or settled. Any 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.
ASC 740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements uncertain tax positions taken or expected to be taken on a tax return. Under ASC 740, tax positions must initially be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions must initially and subsequently be measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and relevant facts.
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. As reflected in the accompanying financial statements, for the period ended October 31, 2021, the Company incurred a net loss of $30,669 and has generated revenue of $19,918. The company has accumulated deficit of $1,181,465 which raise substantial doubt about the Company’s ability to continue as a going concern within one year of the date that the financial statements are issued. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
The Company’s ability to continue as a going concern is dependent upon improving its profitability and the continuing financial support from its shareholders. Management believes the existing shareholders or external financing will provide the additional cash to meet the Company’s obligations as they become due. No assurance can be given that any future financing, if needed, will be available or, if available, that it will be on terms that are satisfactory to the Company. Even if the Company is able to obtain additional financing, if needed, it may contain undue restrictions on its operations, in the case of debt financing, or cause substantial dilution for its stock holders, in the case of equity financing.
PHOENIX PLUS CORP NOTES TO CONDENSED FINANCIAL STATEMENTS FOR THE THREE MONTHS ENDED OCTOBER 31, 2021 (Currency expressed in United States Dollars (“US$”), except for number of shares) (UNAUDITED)
The Company calculates net loss per share in accordance with ASC Topic 260, “Earnings per Share.” Basic loss per share is computed by dividing the net loss by the weighted-average number of common shares outstanding during the period. Diluted income per share is computed similar to basic loss per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common stock equivalents had been issued and if the additional common shares were dilutive.
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 statements of operations.
The reporting currency of the Company is United States Dollars (“US$”). The Company’s subsidiary in Labuan and Hong Kong maintains its books and record in United States Dollars (“US$”) respectively, and Ringgits Malaysia (“MYR”) is functional currency as being the primary currency of the economic environment in which the entity operates.
In general, for consolidation purposes, assets and liabilities of its subsidiary whose functional currency is not the US$ are translated into US$, in accordance with ASC Topic 830-30, “Translation of Financial Statement”, using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements of foreign subsidiary are recorded as a separate component of accumulated other comprehensive income within the statement of stockholders’ equity.
Translation of amounts from MYR into US$1 and HK$ into US$1 has been made at the following exchange rates for the respective periods:
Related parties
Parties, which can be a corporation or individual, are considered to be related if the Company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Companies are also considered to be related if they are subject to common control or common significant influence.
PHOENIX PLUS CORP. NOTES TO CONDENSED FINANCIAL STATEMENTS FOR THE THREE MONTHS ENDED OCTOBER 31, 2021 (Currency expressed in United States Dollars (“US$”), except for number of shares) (UNAUDITED)
Fair value of financial instruments:
The carrying value of the Company’s financial instruments: cash and cash equivalents, prepayment, deposits, accounts payable and accrued liabilities and amount due to a director approximate at their fair values because of the short-term nature of these financial instruments.
The Company also 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.
Leases
Prior to August 1, 2019, the Company accounted for leases under ASC 840, Accounting for Leases. Effective August 1, 2019, the Company adopted the guidance of ASC 842, Leases, which requires an entity to recognize a right-of-use asset and a lease liability for virtually all leases. The implementation of ASC 842 did not have a material impact on the Company’s consolidated financial statements and did not have a significant impact on our liquidity. The Company adopted ASC 842 using a modified retrospective approach. As a result, the comparative financial information has not been updated and the required disclosures prior to the date of adoption have not been updated and continue to be reported under the accounting standards in effect for those periods. (see Note 11).
Recent accounting pronouncements
ASB issues various Accounting Standards Updates relating to the treatment and recording of certain accounting transactions. On June 10, 2014, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2014-10, Development Stage Entities (Topic 915) Elimination of Certain Financial Reporting Requirements, including an Amendment to Variable Interest Entities Guidance in Topic 810, Consolidation, which eliminates the concept of a development stage entity (DSE) entirely from current accounting guidance. The Company has elected adoption of this standard, which eliminates the designation of DSEs and the requirement to disclose results of operations and cash flows since inception.
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.
PHOENIX PLUS CORP NOTES TO CONDENSED FINANCIAL STATEMENTS FOR THE THREE MONTHS ENDED OCTOBER 31, 2021 (Currency expressed in United States Dollars (“US$”), except for number of shares) (UNAUDITED)
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COMMON STOCK |
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Oct. 31, 2021 | |
| Equity [Abstract] | |
| COMMON STOCK | 3. COMMON STOCK
On November 5, 2018, the Company issued shares of restricted common stock, with a par value of $ per share, to Mr. Fong Teck Kheong for initial working capital of $10.
On March 25, 2019, the Company issued shares of restricted common stock, with a par value of $ per share, to Mr. Fong Teck Kheong for additional working capital of $11,990.
Between March 28, 2019 to April 1, 2019, the Company issued shares of restricted common stock to 5 parties, with a par value of $ per share, for total additional working capital of $13,500.
On April 1, 2019, the Company issued shares of restricted common stock to AGAPE ATP Corporation a company incorporated in Nevada with a par value of $ per share, for additional working capital of $1,500.
On April 1, 2019, the Company issued shares of restricted common stock, with a par value of $ per share, to H&D Holding Sdn Bhd, a company incorporated in Malaysia, for additional working capital of $3,000.
Between April 9, 2019 to April 16, 2019, the Company issued shares of restricted common stock to Junsei Ryu, Lee Chong Chow and Phoenix Plus Holding Sdn Bhd with a par value of $ per share, for additional working capital of $753,000.
Between April 25, 2019 to May 10, 2019, the Company sold shares to 19 foreign individuals, whom all reside in Malaysia. A total of shares of restricted common stock were sold at a price of $ per share. The total proceeds to the Company amounted to a total of $200,000.
Between May 11, 2019 to June 18, 2019, the Company sold shares to 23 foreign parties whom resides in Malaysia. A total of shares of restricted common stock were sold at a price of $ per share. The total proceeds to the Company amounted to $413,500.
Between May 20, 2019 to July 25,2019, the Company sold shares to 15 foreign parties , all of which do not reside in the United States. A total of shares of restricted common stock were sold at a price of $ per share. The total proceeds to the Company amounted to a total of $1,100,000.
On July 9, 2021, the company has issued free trade common share of the company at a $ per share for a total consideration of $782,000.
As of October 31, 2021, the Company has an issued and outstanding common share of .
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PROPERTY, PLANT AND EQUIPMENT |
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| Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||
| PROPERTY, PLANT AND EQUIPMENT | 4. PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment as of October 31, 2021 are summarized below:
These leasehold improvement include, but are not strictly limited to, preparing the interior of the office space for the Company’s use, improving functionality, and purchasing new office equipment. The leasehold improvement have completed on September 2019.
Depreciation expense for the period ended October 31, 2021 and October 31, 2020 was $ and $16,323 respectively.
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PREPAYMENT AND DEPOSITS |
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| PREPAYMENT AND DEPOSITS | 5. PREPAYMENT AND DEPOSITS
Prepayments and deposits consisted of the following at October 31, 2021 and July 31, 2021:
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TRADE PAYABLE |
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| TRADE PAYABLE | 6. TRADE PAYABLE
Trade payable consisted of the following at October 31, 2021 and July 31, 2021:
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EQUITY METHOD INVESTMENT |
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| Investments, All Other Investments [Abstract] | |
| EQUITY METHOD INVESTMENT |
7. EQUITY METHOD INVESTMENT
The Company hold investment in business that is accounted for pursuant to the equity method due to the Company’s ability to exert significant influence over decisions relating to their operating and financial affairs. Revenue and expenses of this investment are not consolidated into the Company’s financial statements; rather, the proportionate share of the earnings/losses is reflected as equity method earnings/losses in statements of operations and comprehensive income/loss.
During the three months period ended October 31, 2021 and 2020, the Company accounted USD58 and $ of equity method loss respectively.
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OTHER PAYABLES AND ACCRUED LIABILITIES |
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| OTHER PAYABLES AND ACCRUED LIABILITIES | 8. OTHER PAYABLES AND ACCRUED LIABILITIES
Other payables and accrued liabilities consisted of the following at October 31, 2021 and July 31, 2021:
PHOENIX PLUS CORP. NOTES TO CONDENSED FINANCIAL STATEMENTS FOR THE THREE MONTHS ENDED OCTOBER 31, 2021 (Currency expressed in United States Dollars (“US$”), except for number of shares) (UNAUDITED)
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REVENUE |
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| REVENUE | 9. REVENUE
For the period ended October 31, 2021 and 2020 the Company has revenue arise from the following:
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OTHER INCOME |
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| OTHER INCOME | 10. OTHER INCOME
For the period ended October 31, 2021 and 2020 the Company has other income arise from the following:
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INCOME TAXES |
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| Income Tax Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| INCOME TAXES | 11. INCOME TAXES
For the period ended October 31, 2021 the local (United States) and foreign components of income/(loss) before income taxes were comprised of the following:
The provision for income taxes consisted of the following:
Income taxes are determined in accordance with the provisions of ASC Topic 740, “Income Taxes” (“ASC Topic 740”). Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the year in which those temporary differences are expected to be recovered or settled. Any effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the year that includes the enactment date.
The effective tax rate in the periods presented is the result of the mix of income earned in various tax jurisdictions that apply a broad range of income tax rates. The Company has subsidiaries that operate in various countries: United States, Labuan and Hong Kong that are subject to taxes in the jurisdictions in which they operate, as follows:
United States of America
The Company is registered in the State of Nevada and is subject to the tax laws of the United States of America. As of October 31, 2021 the operations in the United States of America incurred $37,078 of cumulative net operating losses which can be carried forward to offset future taxable income. The net operating loss carry forwards begin to expire in 2038, if unutilized. The Company has provided for a full valuation allowance of $7,786 against the deferred tax assets on the expected future tax benefits from the net operating loss carry forwards as the management believes it is more likely than not that these assets will not be realized in the future.
Labuan
Under the current laws of the Labuan, Phoenix Plus Corp.is governed under the Labuan Business Activity Act, 1990. The tax charge for such company is based on 3% of net audited profit.
Hong Kong
Phoenix Plus International Limited is subject to Hong Kong Profits Tax, which is charged at the statutory income rate of 16.5% on its assessable income.
PHOENIX PLUS CORP. NOTES TO CONDENSED FINANCIAL STATEMENTS FOR THE THREE MONTHS ENDED OCTOBER 31, 2021 (Currency expressed in United States Dollars (“US$”), except for number of shares) (UNAUDITED)
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LEASE RIGHT-OF-USE ASSET AND LEASE LIABILITIES |
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| LEASE RIGHT-OF-USE ASSET AND LEASE LIABILITIES | 12. LEASE RIGHT-OF-USE ASSET AND LEASE LIABILITIES
The Company officially adopted ASC 842 for the year on and after August 1, 2019 as permitted by ASU 2016-02. ASC 842 originally required all entities to use a “modified retrospective” transition approach that is intended to maximize comparability and be less complex than a full retrospective approach. On July 30, 2018, the FASB issued ASU 2018-11 to provide entities with relief from the costs of implementing certain aspects of the new leasing standard, ASU 2016-02 of which permits entities may elect not to recast the comparative years presented when transitioning to ASC 842. As permitted by ASU 2018-11, the Company elect not to recast comparative years, thusly.
As of July 1, 2021, the Company recognized approximately US$40,445, lease liability as well as right-of-use asset for all leases (with the exception of short-term leases) at the commencement date. Lease liabilities are measured at present value of the sum of remaining rental payments as of July 1, 2021, with borrowing rate of 5.60 % adopted from CIMB Bank Berhad’s fixed deposit rate as a reference for discount rate.
A single lease cost is recognized over the lease term on a generally straight-line basis. All cash payments of operating lease cost are classified within operating activities in the statement of cash flows.
The initial recognition of operating lease right and lease liability as follow:
As of October 31, 2021 operating lease right of use asset as follow:
As of October 31, 2021, operating lease liability as follow:
For the period ended October 31, 2021, the amortization of the operating lease right of use asset are $4,927.
Maturities of operating lease obligation as follow:
Other information:
Lease expenses were $5,433 for the period ended October 31, 2021 and $4,401 for the period ended October 31, 2020. The Company adopt ASC 842 on and after August 1, 2019.
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SIGNIFICANT EVENTS |
3 Months Ended |
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Oct. 31, 2021 | |
| Significant Events | |
| SIGNIFICANT EVENTS | 13. SIGNIFICANT EVENTS
During the fiscal year, the World Health Organization declared the Coronavirus (COVID-19) outbreak to be a pandemic, which has caused severe global social and economic disruptions and uncertainties, including markets where the Company operates. The consequences brought about by Covid-19 continue to evolve and whilst the Company actively monitoring and managing its operations to respond to these changes, the Company does not consider it practicable to provide any quantitative estimate on the potential impact it may have on the Company.
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SUBSEQUENT EVENTS |
3 Months Ended |
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Oct. 31, 2021 | |
| Subsequent Events [Abstract] | |
| SUBSEQUENT EVENTS | 14. SUBSEQUENT EVENTS
The Company has evaluated subsequent events from the balance sheet date through October 31, 2021 the date the Company issued unaudited consolidated financial statements in accordance with ASC Topic 855, “Subsequent Events”, which establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued. During this period, there was no subsequent event that required recognition or disclosure. |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) |
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| Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Basis of presentation | Basis of presentation
The consolidated financial statements for Phoenix Plus Corp. and its subsidiaries. For the period ended October 31, 2021 is prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) and include the accounts of Phoenix Plus Corp. and its wholly owned subsidiaries, Phoenix Plus Corp. and Phoenix Plus International Limited. Intercompany accounts and transactions have been eliminated on consolidation. The Company has adopted July 31 as its fiscal year end.
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| Basis of consolidation | Basis of consolidation
The consolidated financial statements include the accounts of the Company and its subsidiaries. All inter-company accounts and transactions have been eliminated upon consolidation.
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| 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 sheets, and the reported revenue and expenses during the periods reported. Actual results may differ from these estimates.
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| Revenue recognition | Revenue recognition
In accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts. ASC 606 creates a five-step model that requires entities to exercise judgment when considering the terms of contracts, which includes (1) identifying the contracts or agreements with a customer, (2) identifying our performance obligations in the contract or agreement, (3) determining the transaction price, (4) allocating the transaction price to the separate performance obligations, and (5) recognizing revenue as each performance obligation is satisfied. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the services it transfers to its clients.
Revenue is measured at the fair value of the consideration received or receivable, net of discounts and taxes applicable to the revenue. The Company derives its revenue from provision of technical consultancy on solar power system and consultancy on green energy solution.
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| 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.
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| Investment under equity method | Investment under equity method
The Company apply the equity method to account for investments it possesses the ability to exercise significant influence, but not control, over the operating and financial policies of the investee. The ability to exercise significant influence is presumed when the investor possesses more than 20% of the voting interests of the investee.
In applying the equity method, the Company records the investment at cost and subsequently increase or decrease the carrying amount of the investment by proportionate share of the net earnings or losses and other comprehensive income of the investee. The Company records dividends or other equity distributions as reductions in the carrying value of the investment.
PHOENIX PLUS CORP. NOTES TO CONDENSED FINANCIAL STATEMENTS FOR THE THREE MONTHS ENDED OCTOBER 31, 2021 (Currency expressed in United States Dollars (“US$”), except for number of shares) (UNAUDITED)
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| Income taxes | Income taxes
Income taxes are determined in accordance with the provisions of ASC Topic 740, “Income Taxes” (“ASC Topic 740”). Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the periods in which those temporary differences are expected to be recovered or settled. Any 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.
ASC 740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements uncertain tax positions taken or expected to be taken on a tax return. Under ASC 740, tax positions must initially be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions must initially and subsequently be measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and relevant facts.
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| 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. As reflected in the accompanying financial statements, for the period ended October 31, 2021, the Company incurred a net loss of $30,669 and has generated revenue of $19,918. The company has accumulated deficit of $1,181,465 which raise substantial doubt about the Company’s ability to continue as a going concern within one year of the date that the financial statements are issued. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
The Company’s ability to continue as a going concern is dependent upon improving its profitability and the continuing financial support from its shareholders. Management believes the existing shareholders or external financing will provide the additional cash to meet the Company’s obligations as they become due. No assurance can be given that any future financing, if needed, will be available or, if available, that it will be on terms that are satisfactory to the Company. Even if the Company is able to obtain additional financing, if needed, it may contain undue restrictions on its operations, in the case of debt financing, or cause substantial dilution for its stock holders, in the case of equity financing.
PHOENIX PLUS CORP NOTES TO CONDENSED FINANCIAL STATEMENTS FOR THE THREE MONTHS ENDED OCTOBER 31, 2021 (Currency expressed in United States Dollars (“US$”), except for number of shares) (UNAUDITED)
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| Net loss per share |
The Company calculates net loss per share in accordance with ASC Topic 260, “Earnings per Share.” Basic loss per share is computed by dividing the net loss by the weighted-average number of common shares outstanding during the period. Diluted income per share is computed similar to basic loss per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common stock equivalents had been issued and if the additional common shares were dilutive.
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| 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 statements of operations.
The reporting currency of the Company is United States Dollars (“US$”). The Company’s subsidiary in Labuan and Hong Kong maintains its books and record in United States Dollars (“US$”) respectively, and Ringgits Malaysia (“MYR”) is functional currency as being the primary currency of the economic environment in which the entity operates.
In general, for consolidation purposes, assets and liabilities of its subsidiary whose functional currency is not the US$ are translated into US$, in accordance with ASC Topic 830-30, “Translation of Financial Statement”, using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements of foreign subsidiary are recorded as a separate component of accumulated other comprehensive income within the statement of stockholders’ equity.
Translation of amounts from MYR into US$1 and HK$ into US$1 has been made at the following exchange rates for the respective periods:
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| Related parties | Related parties
Parties, which can be a corporation or individual, are considered to be related if the Company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Companies are also considered to be related if they are subject to common control or common significant influence.
PHOENIX PLUS CORP. NOTES TO CONDENSED FINANCIAL STATEMENTS FOR THE THREE MONTHS ENDED OCTOBER 31, 2021 (Currency expressed in United States Dollars (“US$”), except for number of shares) (UNAUDITED)
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| Fair value of financial instruments | Fair value of financial instruments:
The carrying value of the Company’s financial instruments: cash and cash equivalents, prepayment, deposits, accounts payable and accrued liabilities and amount due to a director approximate at their fair values because of the short-term nature of these financial instruments.
The Company also 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.
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| Leases | Leases
Prior to August 1, 2019, the Company accounted for leases under ASC 840, Accounting for Leases. Effective August 1, 2019, the Company adopted the guidance of ASC 842, Leases, which requires an entity to recognize a right-of-use asset and a lease liability for virtually all leases. The implementation of ASC 842 did not have a material impact on the Company’s consolidated financial statements and did not have a significant impact on our liquidity. The Company adopted ASC 842 using a modified retrospective approach. As a result, the comparative financial information has not been updated and the required disclosures prior to the date of adoption have not been updated and continue to be reported under the accounting standards in effect for those periods. (see Note 11).
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| Recent accounting pronouncements | Recent accounting pronouncements
ASB issues various Accounting Standards Updates relating to the treatment and recording of certain accounting transactions. On June 10, 2014, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2014-10, Development Stage Entities (Topic 915) Elimination of Certain Financial Reporting Requirements, including an Amendment to Variable Interest Entities Guidance in Topic 810, Consolidation, which eliminates the concept of a development stage entity (DSE) entirely from current accounting guidance. The Company has elected adoption of this standard, which eliminates the designation of DSEs and the requirement to disclose results of operations and cash flows since inception.
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.
PHOENIX PLUS CORP NOTES TO CONDENSED FINANCIAL STATEMENTS FOR THE THREE MONTHS ENDED OCTOBER 31, 2021 (Currency expressed in United States Dollars (“US$”), except for number of shares) (UNAUDITED)
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DESCRIPTION OF BUSINESS AND ORGANIZATION (Tables) |
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| SCHEDULE OF DETAILS OF COMPANY'S SUBSIDIARY | Details of the Company’s subsidiaries:
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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Oct. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| SCHEDULE OF FOREIGN CURRENCY TRANSLATION |
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PROPERTY, PLANT AND EQUIPMENT (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Oct. 31, 2021 | |||||||||||||||||||||||||||||||||||||
| Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||
| SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT | Property, plant and equipment as of October 31, 2021 are summarized below:
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PREPAYMENT AND DEPOSITS (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||
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Oct. 31, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||
| Prepayment And Deposits | ||||||||||||||||||||||||||||||||||||||||||||||
| SCHEDULE OF PREPAYMENT AND DEPOSITS | Prepayments and deposits consisted of the following at October 31, 2021 and July 31, 2021:
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TRADE PAYABLE (Tables) |
3 Months Ended | |||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Oct. 31, 2021 | ||||||||||||||||||||||||||||
| Trade Payable | ||||||||||||||||||||||||||||
| SCHEDULE OF TRADE PAYABLE | Trade payable consisted of the following at October 31, 2021 and July 31, 2021:
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OTHER PAYABLES AND ACCRUED LIABILITIES (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||
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Oct. 31, 2021 | |||||||||||||||||||||||||||||||||||||
| Payables and Accruals [Abstract] | |||||||||||||||||||||||||||||||||||||
| SCHEDULE OF OTHER PAYABLES AND ACCRUED LIABILITIES | Other payables and accrued liabilities consisted of the following at October 31, 2021 and July 31, 2021:
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REVENUE (Tables) |
3 Months Ended | |||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Oct. 31, 2021 | ||||||||||||||||||||||||||||
| Revenue from Contract with Customer [Abstract] | ||||||||||||||||||||||||||||
| SCHEDULE OF REVENUE | For the period ended October 31, 2021 and 2020 the Company has revenue arise from the following:
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OTHER INCOME (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Oct. 31, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other Income and Expenses [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| SCHEDULE OF OTHER INCOME | For the period ended October 31, 2021 and 2020 the Company has other income arise from the following:
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INCOME TAXES (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Oct. 31, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Income Tax Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| SCHEDULE OF LOCAL AND FOREIGN COMPONENTS OF INCOME (LOSS) BEFORE INCOME TAX | For the period ended October 31, 2021 the local (United States) and foreign components of income/(loss) before income taxes were comprised of the following:
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| SCHEDULE OF PROVISION FOR INCOME TAX | The provision for income taxes consisted of the following:
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LEASE RIGHT-OF-USE ASSET AND LEASE LIABILITIES (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Oct. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Lease Right-of-use Asset And Lease Liabilities | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| SCHEDULE OF INITIAL RECOGNITION OF OPERATING LEASE RIGHT AND LEASE LIABILITY | The initial recognition of operating lease right and lease liability as follow:
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| SCHEDULE OF OPERATING LEASE RIGHT OF USE ASSET | As of October 31, 2021 operating lease right of use asset as follow:
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| SCHEDULE OF OPERATING LEASE LIABILITY | As of October 31, 2021, operating lease liability as follow:
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| SCHEDULE OF MATURITIES OF OPERATING LEASE OBLIGATION | Maturities of operating lease obligation as follow:
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| SCHEDULE OF OTHER INFORMATION | Other information:
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SCHEDULE OF DETAILS OF COMPANY'S SUBSIDIARY (Details) |
3 Months Ended |
|---|---|
Oct. 31, 2021 | |
| Parent Company [Member] | |
| Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |
| Company name | Phoenix Plus Corp. |
| Place and date of incorporation | Labuan / January 4, 2019 |
| Particulars of issued capital | 100 share of ordinary share of US$1 each |
| Principal activities | Investment holding |
| Phoenix Plus International Limited [Member] | |
| Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | |
| Company name | Phoenix Plus International Limited |
| Place and date of incorporation | Hong Kong / March 19, 2019 |
| Particulars of issued capital | 1 ordinary share of HKD$1 |
| Principal activities | Providing technical consultancy on solar power system and consultancy on green energy solution |
DESCRIPTION OF BUSINESS AND ORGANIZATION (Details Narrative) |
Mar. 18, 2019 |
|---|---|
| Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
| Ownership percentage | 100.00% |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) |
3 Months Ended | ||
|---|---|---|---|
Oct. 31, 2021 |
Oct. 31, 2020 |
Jul. 31, 2021 |
|
| Accounting Policies [Abstract] | |||
| Income tax likelihood settlement, description | Such tax positions must initially and subsequently be measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and relevant facts | ||
| Net loss | $ 30,669 | $ 35,341 | |
| Revenue | 19,918 | $ 14,193 | |
| Accumulated deficit | $ 1,181,465 | $ 1,150,796 | |
SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT (Details) - USD ($) |
Oct. 31, 2021 |
Jul. 31, 2021 |
|---|---|---|
| Property, Plant and Equipment [Abstract] | ||
| Leasehold improvement | $ 114,263 | |
| Accumulated depreciation | (114,263) | |
| Total |
PROPERTY, PLANT AND EQUIPMENT (Details Narrative) - USD ($) |
3 Months Ended | |
|---|---|---|
Oct. 31, 2021 |
Oct. 31, 2020 |
|
| Property, Plant and Equipment [Abstract] | ||
| Depreciation | $ 16,323 | |
SCHEDULE OF PREPAYMENT AND DEPOSITS (Details) - USD ($) |
Oct. 31, 2021 |
Jul. 31, 2021 |
|---|---|---|
| Prepayment And Deposits | ||
| Subscription receivable | $ 232,040 | |
| Deposits | 3,277 | 3,277 |
| Prepayment | 3,598 | 9,031 |
| Total prepayments and deposits | $ 6,875 | $ 244,348 |
SCHEDULE OF TRADE PAYABLE (Details) - USD ($) |
Oct. 31, 2021 |
Jul. 31, 2021 |
|---|---|---|
| Trade Payable | ||
| Trade payable | $ 34,248 | $ 38,738 |
| Total trade payable | $ 34,248 | $ 38,738 |
EQUITY METHOD INVESTMENT (Details Narrative) - USD ($) |
3 Months Ended | |
|---|---|---|
Oct. 31, 2021 |
Oct. 31, 2020 |
|
| Investments, All Other Investments [Abstract] | ||
| Share of loss of associations | $ 58 | |
SCHEDULE OF OTHER PAYABLES AND ACCRUED LIABILITIES (Details) - USD ($) |
Oct. 31, 2021 |
Jul. 31, 2021 |
|---|---|---|
| Payables and Accruals [Abstract] | ||
| Accrued audit fees | $ 12,500 | $ 12,500 |
| Accrued expenses | 12,474 | 16,178 |
| Total other payables and accrued liabilities | $ 24,974 | $ 28,678 |
SCHEDULE OF REVENUE (Details) - USD ($) |
3 Months Ended | |
|---|---|---|
Oct. 31, 2021 |
Oct. 31, 2020 |
|
| Disaggregation of Revenue [Line Items] | ||
| Total Revenue | $ 19,918 | $ 14,193 |
| Consultancy Service Provided [Member] | ||
| Disaggregation of Revenue [Line Items] | ||
| Total Revenue | $ 19,918 | $ 14,193 |
SCHEDULE OF OTHER INCOME (Details) - USD ($) |
3 Months Ended | |
|---|---|---|
Oct. 31, 2021 |
Oct. 31, 2020 |
|
| Other income | $ 35,153 | $ 21,558 |
| UNITED STATES | ||
| Other income | ||
| Labuan [Member] | ||
| Other income | 34,188 | 20,691 |
| HONG KONG | ||
| Other income | $ 965 | $ 867 |
SCHEDULE OF LOCAL AND FOREIGN COMPONENTS OF INCOME (LOSS) BEFORE INCOME TAX (Details) - USD ($) |
3 Months Ended | |
|---|---|---|
Oct. 31, 2021 |
Oct. 31, 2020 |
|
| Operating Loss Carryforwards [Line Items] | ||
| Loss before income tax | $ (30,669) | $ (35,341) |
| Labuan [Member] | ||
| Operating Loss Carryforwards [Line Items] | ||
| Loss before income tax | 33,973 | 17,649 |
| HONG KONG | ||
| Operating Loss Carryforwards [Line Items] | ||
| Loss before income tax | (27,564) | (47,647) |
| State and Local Jurisdiction [Member] | ||
| Operating Loss Carryforwards [Line Items] | ||
| Loss before income tax | $ (37,078) | $ (5,343) |
SCHEDULE OF PROVISION FOR INCOME TAX (Details) - USD ($) |
3 Months Ended | |
|---|---|---|
Oct. 31, 2021 |
Oct. 31, 2020 |
|
| Income Tax Disclosure [Abstract] | ||
| Current, Local | ||
| Current, Foreign | ||
| Deferred, Local | ||
| Deferred, Foreign | ||
| Income tax expense | ||
INCOME TAXES (Details Narrative) |
3 Months Ended |
|---|---|
|
Oct. 31, 2021
USD ($)
| |
| Net operating loss carryforward | $ 37,078 |
| Expire date | 2038 |
| Valuation allowance of deferred tax assets | $ 7,786 |
| Labuan [Member] | |
| Income tax rate | 3.00% |
| HONG KONG | |
| Income tax rate | 16.50% |
SCHEDULE OF INITIAL RECOGNITION OF OPERATING LEASE RIGHT AND LEASE LIABILITY (Details) |
Jul. 02, 2021
USD ($)
|
|---|---|
| Lease Right-of-use Asset And Lease Liabilities | |
| Gross lease payable | $ 42,647 |
| Less: imputed interest | (2,202) |
| Initial recognition as of July 1, 2021 | $ 40,445 |
SCHEDULE OF OPERATING LEASE RIGHT OF USE ASSET (Details) - USD ($) |
3 Months Ended | ||
|---|---|---|---|
Oct. 31, 2021 |
Jul. 31, 2021 |
Jul. 02, 2021 |
|
| Lease Right-of-use Asset And Lease Liabilities | |||
| Operating lease liability, beginning balance | $ 26,772 | ||
| Additional portion from 1 July 31, 2020 to 30 June 2021 | 2,719 | ||
| Add: new lease addition from 1 July 2021 to 30 June 2023 | 40,445 | ||
| Accumulated amortization | (36,188) | ||
| Foreign exchange translation gain | 919 | ||
| Operating lease right of use asset, ending balance | $ 34,667 | $ 38,848 | $ 40,445 |
SCHEDULE OF OPERATING LEASE LIABILITY (Details) - USD ($) |
3 Months Ended | |||
|---|---|---|---|---|
Oct. 31, 2021 |
Jul. 31, 2021 |
Jul. 02, 2021 |
Jul. 31, 2020 |
|
| Operating lease liability, beginning balance | $ 26,772 | |||
| Less: lease liability current portion | $ (20,412) | (19,749) | $ (40,445) | |
| Lease liability non-current portion | 14,255 | $ 19,099 | ||
| Operating Lease [Member] | ||||
| Operating lease liability, beginning balance | 34,667 | $ 26,772 | ||
| Add: additional portion (increase of leasing fee) | 2,719 | |||
| Add: new lease addition from 1 July 2021 to 30 June 2023 | 40,445 | |||
| Less: gross repayment | (36,701) | |||
| Add: imputed interest | 506 | |||
| Foreign exchange translation gain | 926 | |||
| Operating lease liability, ending balance | 34,667 | |||
| Less: lease liability current portion | (20,412) | |||
| Lease liability non-current portion | $ 14,255 |
SCHEDULE OF MATURITIES OF OPERATING LEASE OBLIGATION (Details) |
Oct. 31, 2021
USD ($)
|
|---|---|
| Lease Right-of-use Asset And Lease Liabilities | |
| October 31, 2022 (12 months) | $ 20,412 |
| July 30, 2023 (8 months) | 14,255 |
| Total | $ 34,667 |
SCHEDULE OF OTHER INFORMATION (Details) - USD ($) |
3 Months Ended | |
|---|---|---|
Oct. 31, 2021 |
Oct. 31, 2020 |
|
| Lease Right-of-use Asset And Lease Liabilities | ||
| Operating cash flow from operating lease | $ 4,181 | $ 4,227 |
| Right-of-use assets obtained in exchange for operating lease liabilities | $ 34,667 | $ 10,562 |
| Remaining lease term for operating lease (years) | 1 year 8 months 12 days | 8 months 12 days |
| Weighted average discount rate for operating lease | 5.60% | 3.30% |
LEASE RIGHT-OF-USE ASSET AND LEASE LIABILITIES (Details Narrative) - USD ($) |
3 Months Ended | |||
|---|---|---|---|---|
Oct. 31, 2021 |
Oct. 31, 2020 |
Jul. 31, 2021 |
Jul. 02, 2021 |
|
| Lease Right-of-use Asset And Lease Liabilities | ||||
| Lease liabilities, current | $ 20,412 | $ 19,749 | $ 40,445 | |
| Lease asset-right of use | 34,667 | $ 38,848 | $ 40,445 | |
| Lease liability discount rate | 5.60% | |||
| Amortization of operating lease right of use asset | 4,927 | |||
| Lease expenses | $ 5,433 | $ 4,401 | ||