Deferred Government Grants

3 Months Ended

Dec. 31, 2015

Deferred Government Grants [Text Block]

14. Deferred Government Grants

Deferred government grants as of September 30 and December 31, 2015 consist of the following:

		September 30,			December 31,
		2015			2015
Total government grants	$	7,195,624		$	6,997,449
Less: Current portion		(181,510	)		(177,631	)
Non-current portion	$	7,014,114		$	6,819,818

In September 2013, the Management Committee of Dalian Economic Zone Management Committee (the “Management Committee”) provided a subsidy of RMB150 million to finance the costs incurred in moving our facilities to Dalian, including the loss of sales while the new facilities were being constructed. During the three months ended December 31, 2014, the Company recognized $23,380,264 as income after offset of the related removal expenditures of $1,016,327. No such income or offset was recognized in fiscal 2016.

On October 17, 2014, the Company received a subsidy of RMB46.2 million ($7.1 million) pursuant to an agreement with the Management Committee dated July 2, 2013 for costs of land use rights and to be used to construct the new manufacturing site in Dalian. Part of the facilities had been completed and commenced to operate in July 2015 and the Company has initiated amortization on a straight-line basis over the estimated useful lives of the depreciable facilities constructed thereon. The Company expects that the remaining facilities will be completed and put into operation by June 2016. For the three months ended December 31, 2014 and 2015, the Company offset government grants of nil and $45,135 against depreciation expenses of the Dalian facilities, respectively.