NOTE 8 - RELATED PARTY TRANSACTIONS

9 Months Ended

Jan. 31, 2022

Notes

NOTE 8 - RELATED PARTY TRANSACTIONS

NOTE 8 - RELATED PARTY TRANSACTIONS

Related parties of the Company consist of the following:
	-	Mr. Jianjun Yan, Chief Executive Officer and Director of the Company;
	-	Shandong Shengwang Pharmaceutical Co., Ltd. ("Pharmaceutical Corporation"), a Chinese limited liability company which Mr. Jianjun Yan is a legal representative and general manager of Pharmaceutical Corporation;
	-	Mr. Laiwang Zhang, former Chairman of the Board, resigned on September 7, 2021;
	-	Qufu Shengwang Import and Export Co., Ltd. ("Qufu Shengwang Import and Export"), a Chinese limited liability company, controlled by Mr. Laiwang Zhang. Due to recent changes in management personnel, Qufu Shengwang Import and Export is no longer considered a related party, and transactions with Qufu Shengwang Import and Export have been reclassified to third party transactions in fiscal 2022; and
	-	Mr. Weidong Chai, a management member of Qufu Shengren Pharmaceutical Co., Ltd.

Accounts receivable - related party and revenue - related party

As of January 31, 2022 and April 30, 2021, $nil and $5,999,791 in accounts receivable - related party, respectively, were related to sales of products to Qufu Shengwang Import and Export. For the three and nine months ended January 31, 2022 we did not have revenue and cost of revenue from related party, but we recorded revenue - related party and cost of revenue – related party of $2,756,224 and $3,431,319, and $5,010,742 and $5,587,081, the three and nine months ended January 31, 2021, respectively, from Qufu Shengwang Import and Export.

Due to related parties

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The Company mainly finances its operations through proceeds borrowed from related parties. As of January 31, 2022 and April 30, 2021, due to related parties consisted the following:

	January 31, 2022	April 30, 2021
Pharmaceutical Corporation	$4,601,176	$3,484,266
Qufu Shengwang Import and Export	-	6,140,404
Jianjun Yan	3,831,674	-
Weidong Chai	239,629	218,966
Total	$8,672,479	$9,843,636

From time to time, we receive advances from related parties and advance funds to related parties for working capital purposes. In the nine months ended January 31, 2022, the Company borrowed multiple one-year loans in aggregated amount of RMB9,820,000 (approximately $1,529,000) from Jianjun Yan, bearing an annual interest rate of 12%. The Company also borrowed two loans in amount of RMB10,717,600 (approximately $1,685,000) and RMB5,217,000 (approximately $812,000), respectively, bearing an annual interest rate of 10% and 4% from Jianjun Yan in the past years. On October 7, 2021 and April 1, 2021, these loans were extended for another one year, respectively, under the same terms and conditions and reclassified unpaid interest payable to the principal of these loans. The company repaid Jianjun Yan in a total amount of RMB2,750,000 (approximately $428,000) for part of his loans in the third quarter of fiscal 2022.

On September 23, 2019, the Company borrowed a one-year loan of RMB1,221,000 (approximately $192,000) from Weidong Cai, bearing an annual interest rate of 10%. On September 23, 2021 and 2020, the parties extended the loan for another year, under the same terms and conditions, reclassified unpaid interest payable to the principal of this loan, resulting in an increase of principal from RMB1,221,000 (approximately $192,000) to RMB1,477,410 (approximately $232,000).

For the three and nine months ended January 31, 2022 and 2021, interest expense – related parties related to short-term loans amounted to $101,176 and $5,391, and $255,767 and $27,065, respectively.