Variable Interest Entities

6 Months Ended

Dec. 31, 2019

Variable Interest Entities [Abstract]

VARIABLE INTEREST ENTITIES

NOTE 16 – VARIABLE INTEREST ENTITIES

In accordance with accounting standards regarding consolidation of variable interest entities, VIEs are generally entities that lack sufficient equity to finance their activities without additional financial support from other parties or whose equity holders lack adequate decision making ability. All VIEs with which a company is involved must be evaluated to determine the primary beneficiary of the risks and rewards of the VIE. The primary beneficiary is required to consolidate the VIE for financial reporting purposes.

Green Nevada through one of its subsidiaries, Jinong, entered into a series of agreements (the "VIE Agreements") with Yuxing for it to qualify as a VIE, effective June 16, 2013.

The Company has concluded, based on the contractual arrangements, that Yuxing is a VIE and that the Company's wholly-owned subsidiary, Jinong, absorbs a majority of the risk of loss from the activities of Yuxing, thereby enabling the Company, through Jinong, to receive a majority of Yuxing expected residual returns.

On June 30, 2016 and January 1, 2017, the Company, through its wholly-owned subsidiary Jinong, entered into strategic acquisition agreements and also into a series of contractual agreements to qualify as VIEs with the shareholders of the sales VIE Companies.

Jinong, the sales VIE Companies, and the shareholders of the sales VIE Companies also entered into a series of contractual agreements for the sales VIE Companies to qualify as VIEs (the "VIE Agreements").

On November 30, 2017, the Company, through its wholly-owned subsidiary Jinong, exited the VIE agreements with the shareholders of Zhenbai.

As a result of these contractual arrangements, with Yuxing and the sales VIE Companies the Company is entitled to substantially all of the economic benefits of Yuxing and the VIE Companies. The following financial statement amounts and balances of the VIEs were included in the accompanying consolidated financial statements as of December 31, 2019 and June 30, 2019:

	December 31,		June 30,
	2019		2019
ASSETS
Current Assets
Cash and cash equivalents	$	1,976,908	$	818,312
Accounts receivable, net		32,439,136		29,933,837
Inventories		21,662,460		19,944,011
Other current assets		488,256		475,001
Related party receivable		148,919		(1,031	)
Advances to suppliers		1,113,526		3,606,384
Total Current Assets		57,829,205		54,776,514
Plant, Property and Equipment, Net		9,134,270		9,753,039
Other assets		215,547		218,549
Intangible Assets, Net		9,705,603		10,212,668
Goodwill		3,164,702		3,208,779
Total Assets	$	80,049,327	$	78,169,549
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable		13,563,387		17,250,276
Customer deposits		460,944		256,489
Accrued expenses and other payables		7,287,949		6,243,753
Amount due to related parties		42,596,012		42,680,723
Total Current Liabilities	$	63,908,292	$	66,431,241
Long-term Loan		0		0
Total Liabilities	$	63,908,292	$	66,431,241
Stockholders' equity		16,141,035		11,738,308
Total Liabilities and Stockholders' Equity		80,049,327	$	78,169,549

	Three Months Ended December 31,
	2019		2018
Revenue	$	12,776,975	$	12,911,414
Expenses		12,280,810		13,571,628
Net income	$	496,165	$	(660,214	)

	Six Months Ended December 31,
	2019		2018
Revenue	$	28,220,513	$	30,896,434
Expenses		23,701,306		28,943,442
Net income	$	4,519,207	$	1,952,992