10-Q

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

For the quarterly period ended September 30, 2016

[  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

For the transition period from ____________ to ____________

Commission File Number: 000-51060

CHINA HEALTH INDUSTRIES HOLDINGS, INC.
(Exact name of registrant as specified in its charter)

Delaware	86-0827216
(State or other jurisdiction of	(IRS Employer
incorporation or organization)	Identification No.)

168 Binbei Street, Songbei District
Harbin City, Heilongjiang Province
People’s Republic of China 150028
(Address of principal executive offices) (Zip Code)

86-451-88100688
(Issuer's telephone number, including area code)

Not Applicable
(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes [X]     No [  ]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
Yes [X]     No [  ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer [  ]	Accelerated filer [  ]
Non-accelerated filer   [  ]	Smaller reporting company [X]
( Do not check if a smaller reporting company )

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes [  ]     No [X]

APPLICABLE ONLY TO CORPORATE ISSUERS:

As of November 4, 2016, there were 65,839,737 shares of common stock, $0.0001 par value, issued and outstanding.

TABLE OF CONTENTS

		Page
PART I	FINANCIAL INFORMATION	4
Item 1.	Financial Statements (Unaudited)	4
	Condensed Consolidated Balance Sheets As of September 30, 2016 and June 30, 2016 (Unaudited)	4
	Condensed Consolidated Statements of Operations and Comprehensive Income For the Three Months Ended September 30, 2016 and 2015 (Unaudited)	5
	Condensed Consolidated Statements of Cash Flows For the Three Months Ended September 30, 2016 and 2015 (Unaudited)	6
	Notes to Condensed Consolidated Financial Statements As of September 30, 2016 (Unaudited)	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	36
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	44
Item 4.	Controls and Procedures	44
PART II	OTHER INFORMATION	45
Item 6.	Exhibits	45
Signatures		46
Exhibits/Certifications		47

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

CHINA HEALTH INDUSTRIES HOLDINGS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

		September 30,		June 30,
		2016		2016
ASSETS
Current assets
Cash and cash equivalents	$	20,778,742	$	29,783,152
Short term investment		8,997,526		-
Interest receivable		224,938		-
Accounts receivable, net		962,055		1,145,131
Inventory		452,029		414,784
Other receivables, net		35,472		35,484
Advance to suppliers		153,816		154,430
Current assets held for discontinued operation		14,291		14,339
Total current assets		31,618,869		31,547,320
Property, plant and equipment, net		3,772,529		3,866,765
Intangible assets, net		4,065,541		4,191,059
Construction in progress		676,307		670,051
Other assets held for discontinued operation		3,589		3,602
Total assets	$	40,136,835	$	40,278,797
LIABILITIES AND EQUITY
Current liabilities
Short-term loans	$	1,499,588	$	1,504,687
Accounts payable and accrued expenses		465,996		487,172
Other payables		32,563		37,036
Advance from customers		190,025		164,122
Related party debts		2,790,852		2,713,406
Wages payable		198,528		173,004
Taxes payable		322,904		467,674
Current liabilities held for discontinued operation		480,384		482,013
Total current liabilities		5,980,840		6,029,114
Equity
Common stock, ($0.0001 par value, 300,000,000 shares authorized,     65,839,737 and 65,839,737 issued and outstanding as of September 30,     2016 and June 30, 2016, respectively)		6,554		6,554
Additional paid-in capital		521,987		521,987
Accumulated other comprehensive income		666,335		784,045
Statutory reserve		38,679		38,679
Retained earnings		32,922,267		32,898,244
Total stockholders' equity		34,155,822		34,249,509
Non-controlling interests		173		174
Total equity		34,155,995		34,249,683
Total liabilities and equity	$	40,136,835	$	40,278,797

The accompanying notes are an integral part of these condensed consolidated financial statements.

4

CHINA HEALTH INDUSTRIES HOLDINGS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(UNAUDITED)

		For the Three Months Ended
		September 30, 2016			September 30, 2015
REVENUE	$	1,180,168		$	1,956,068
COST OF GOODS SOLD		755,285			1,418,964
GROSS PROFIT		424,883			537,104
OPERATING EXPENSES
Selling, general and administrative expenses		430,264			348,879
Depreciation and amortization expenses		148,875			181,961
Total operating expenses		579,139			530,840
INCOME (LOSS) FROM OPERATIONS		(154,256	)		6,264
OTHER INCOME/(EXPENSES)
Interest income		19,909			18,107
Interest expense		(21,686	)		(31,624	)
Investment income		225,093			-
Other income, net		8,993			9,519
Total other income (expenses), net		232,309			(3,998	)
INCOME BEFORE INCOME TAXES		78,053			2,266
Provision for income taxes		54,030			32,406
NET INCOME (LOSS) FROM CONTINUING OPERATIONS		24,023			(30,140	)
NET LOSS FROM DISCONTINUED OPERATIONS		-			(196	)
NET INCOME (LOSS)		24,023			(30,336	)
Less: net loss attributable to non-controlling interests		-			(2	)
NET INCOME (LOSS) ATTRIBUTABLE TO CHINA HEALTH INDUSTRIES HOLDINGS		24,023			(30,334	)
NET INCOME (LOSS) FROM CONTINUING OPERATIONS		24,023			(30,140	)
NET LOSS FROM DISCONTINUED OPERATIONS		-			(196	)
OTHER COMPREHENSIVE LOSS
Foreign currency translation loss		(117,711	)		(899,478	)
COMPREHENSIVE LOSS		(93,688	)		(929,814	)
Less: comprehensive loss attributable to non-controlling interests		(1	)		(7	)
COMPREHENSIVE LOSS ATTRIBUTABLE TO CHINA HEALTH INDUSTRIES HOLDINGS	$	(93,687	)	$	(929,807	)
Net income (loss) attributable to China Health Industries Holdings' shareholders per share are:
Basic & diluted income (loss) per share	$	0.0004		$	(0.0005	)
Weighted average shares outstanding:
Basic & diluted weighted average shares outstanding		65,616,175			65,539,737

The accompanying notes are an integral part of these condensed consolidated financial statements.

5

CHINA HEALTH INDUSTRIES HOLDINGS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

		For the Three Months Ended
		September 30,			September 30,
		2016			2015
Cash Flows from Operating Activities
Net income (loss) available to China Health Industries Holdings	$	24,023		$	(30,334	)
Net loss from discontinued operations		-			(196	)
Net income (loss) from continuing operations		24,023			(30,138	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization expenses		192,577			233,185
Provision for doubtful accounts		(1,243	)		2,765
Non-controlling interests		-			(2	)
Short term investment income		(225,093	)		-
Changes in operating assets and liabilities
Accounts receivable		178,748			48,951
Other receivables		(111	)		(856	)
Inventory		(38,678	)		(41,387	)
Advance to suppliers and prepaid expenses		90			(22,577	)
Accounts payables and accrued expenses		(19,544	)		61,205
Advance from customers and other payables		22,130			10,974
Wages payable		26,128			(85,462	)
Taxes payable		(143,283	)		33,632
Net cash provided by operating activities from continuing operations		15,744			210,290
Net cash provided by operating activities from discontinued operations
Net cash provided by operating activities		15,744			210,290
Cash Flows from Investing Activities
Expenditure in short term investment		(9,003,737	)		-
Notes receivable		-			571
Purchases of property, plant and equipment		-			(454	)
Expenditure in construction in progress		(6,718	)		(28,299	)
Net cash used in investing activities from continuing operations		(9,010,455	)		(28,182	)
Net cash used in investing activities from discontinued operations		-			-
Net cash used in investing activities		(9,010,455	)		(28,182	)
Cash Flows from Financing Activities
Proceeds from related party debts		85,085			49,181
Net cash provided by financing activities from continuing operations		85,085			49,181
Net cash provided by financing activities from discontinued operations		-			-
Net cash provided by financing activities		85,085			49,181
Effect of exchange rate changes on cash and cash equivalents from continuing operations		(94,784	)		(518,767	)
Effect of exchange rate changes on cash and cash equivalents from discontinued operations		(29	)		(226	)
Net decrease in cash and cash equivalents from continuing operations		(9,004,410	)		(287,478	)
Net decrease in cash and cash equivalents from discontinued operations		(29	)		(226	)
Cash and cash equivalents, beginning balance from continuing operations		29,783,152			21,113,832
Cash and cash equivalents, beginning balance from discontinued operations		8,578			9,195
Cash and cash equivalents, ending balance from continuing operations	$	20,778,742		$	20,826,354
Cash and cash equivalents, ending balance from discontinued operations	$	8,549		$	8,969
Supplemental cash flow information
Cash paid for income taxes	$	201,142		$	336,058
Cash paid for interest expense	$	21,686		$	31,624
Non-cash activities:
Loan from related party for the construction of a facility	$	457,690		$	483,876

The accompanying notes are an integral part of these condensed consolidated financial statements.

6

CHINA HEALTH INDUSTRIES HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 1 - ORGANIZATION AND BUSINESS BACKGROUND

China Health Industries Holdings, Inc. (“China Health US”) was incorporated in the State of Arizona on July 11, 1996 and was the successor of the business known as Arizona Mist, Inc. which began in 1989. On May 9, 2005, it entered into a Stock Purchase Agreement and Share Exchange (effecting a reverse merger) with Edmonds 6, Inc. (“Edmonds 6”), a Delaware corporation, and changed its name to Universal Fog, Inc. Pursuant to this agreement, Universal Fog, Inc. (which has been in continuous operation since 1996) became a wholly-owned subsidiary of Edmonds 6.

China Health Industries Holdings Limited (“China Health HK”) was incorporated on July 20, 2007 in Hong Kong under the Companies Ordinance as a limited liability company. China Health HK was formed for the purpose of seeking and consummating a merger or acquisition with a business entity organized as a private corporation, partnership, or sole proprietorship as defined by Financial Accounting Standards Board (“FASB”) ACS Topic 915 (“Development Stage Entities”).

Harbin Humankind Biology Technology Co., Limited (“Humankind”) was incorporated in Harbin City, Heilongjiang Province, the People’s Republic of China (the “PRC”) on December 14, 2003, as a limited liability company under the Company Law of the PRC. Humankind is engaged in the manufacturing and sale of health products.

On August 20, 2007, the sole shareholder of China Health HK entered into a share purchase agreement (the “Share Purchase Agreement”) with the owners of Humankind. Pursuant to the Share Purchase Agreement, China Health HK purchased 100% of the ownership in Humankind for a cash consideration of $60,408 (the “Share Purchase”). Subsequent to the completion of the Share Purchase, Humankind became a wholly-owned subsidiary of China Health HK. The Share Purchase was accounted for as a “reverse merger” since the owner of Humankind owned a majority of the outstanding shares of China Health HK’s common stock immediately following the execution of the Share Purchase Agreement, it was deemed to be the acquirer in the reverse merger. Consequently, the assets and liabilities and the historical operations that have been reflected in the financial statements for periods prior to the Share Purchase are those of Humankind and have been recorded at the historical cost basis. After completion of the Share Purchase, China Health HK’s consolidated financial statements include the assets and liabilities of both China Health HK and Humankind, the historical operations of Humankind, and the operations of China Health HK and its subsidiaries from the closing date of the Share Purchase.

7

On October 14, 2008, Humankind set up a 99% owned subsidiary, Harbin Huimeijia Medicine Company (“Huimeijia”), with its primary business being manufacturing and distributing medicine. Mr. Xin Sun, the Company’s majority owner, owns 1% of Huimeijia. Huimeijia is consolidated in the consolidated financial statements of China Health HK.

On December 31, 2008, China Health HK entered into a reverse merger with Universal Fog, Inc., a U.S. publicly traded shell company (the “Transaction”). China Health HK is the acquirer in the Transaction, and the Transaction has been treated as a recapitalization of China Health US. After the Transaction and a 20:1 reverse stock split, Mr. Xin Sun owned 61,203,088 shares of common stock, representing 98.3% of the 62,234,737 total outstanding shares of common stock of China Health US. On April 7, 2009, Mr. Sun transferred 28,200,000 shares of common stock to 296 individuals, leaving him with 33,003,088 shares of common stock of China Health US, or approximately 53.03% of the total outstanding shares of common stock. Universal Fog, Inc. changed its name to China Health Industries Holdings, Inc. on February 19, 2009.

On November 22, 2013, Humankind completed the acquisition of Heilongjiang Huimeijia Pharmaceutical Co., Ltd. (“HLJ Huimeijia”) for a total purchase price of $16,339,869 (RMB100,000,000). HLJ Huimeijia was founded on October 30, 2003, and is engaged in the manufacturing and distribution of tincture, ointments, rubber paste (including hormones), topical solution, suppositories, liniment (including traditional Chinese medicine extractions), enemas and oral liquids. HLJ Huimeijia’s predecessor is Heilongjiang Xue Du Pharmaceutical Co., Ltd., which has established its brand name in the market through its supply of high quality medical products. HLJ Huimeijia is categorized as a “high and new technology” enterprise by the Science Technology Department in Heilongjiang Province. HLJ Huimeijia has 21 products which have been approved by, and have received approval numbers issued by, the China State Food and Drug Administration (the “CFDA”). In addition, HLJ Huimeijia is the holder of one patent for utility models, five patents for external design and three trademarks in China, including the Chinese brand name of “Xue Du” which has an established reputation among customers in northeastern China.

8

On December 24, 2014, Humankind entered into a Stock Transfer Agreement (the “Original Agreement”) with Xiuzheng Pharmaceutical Group Co., Ltd. a company incorporated under the laws of the People’s Republic of China and located in Jilin province (“Xiuzheng Pharmacy” or the “Buyer”), Mr. Xin Sun, the CEO of the Company, and Huimeijia, a 99% owned subsidiary of Humankind and 1% owned by Mr. Xin Sun, pursuant to which, Humankind and Mr. Xin Sun (the “Equity Holders”), shall sell their respective equity interests in Huimeijia, to Xiuzheng Pharmacy. On February 9, 2015, the four parties entered into a supplementary agreement (the “Supplementary Agreement”) to modify the terms of the Original Agreement, pursuant to which, the Equity Holders and Huimeijia (collectively the “Assets Transferors”) shall only sell the 19 drug approval numbers (the “Assets”) to Xiuzheng Pharmacy. The Equity Holders will retain the equity interests in Huimeijia, but will have the equity interests pledged to Xiuzheng Pharmacy until the Assets are transferred. On October 12, 2016, the four parties agreed to rescind the Supplementary Agreement and entered into a new supplementary agreement, pursuant to which, the four parties agreed to execute the transfer of the equity interests based on the Original Agreement, and according to which the Equity Holders shall sell their respective equity interests in Huimeijia to Xiuzheng Pharmacy for a total cash consideration of RMB 8,000,000 (approximately $1,306,186, the “Purchase Price”) to the Equity Holders. As of the date of this report, 40% of the Purchase Price was paid and the Company has completed the changes in business registration and Xiuzheng Pharmacy obtained the newly issued document evidencing its ownership on Huimeijia, which is the business license issued by the local State Administration of Industry and Commerce in Harbin (“Harbin SAIC”) to Huimeijia where the ownership of Huimeijia has now been recorded as held by Xiuzheng Pharmacy with Harbin SAIC, and the legal representative (a person that is authorized to take most of the corporate actions on behalf of a company under the corporate laws in China) of Huimeijia has now become a person designated by the Buyer. The transfer of all the drugs to the Buyer and the remainder of the Purchase Price are pending to be processed (See Note 3). As of September 30, 2016, the results of operations of Huimeijia business are reflected in the Company’s unaudited condensed consolidated financial statements as discontinued operations.

China Health US, China Health HK, Humankind, Huimeijia and HLJ Huimeijia are collectively referred herein to as the “Company.”

As of September 30, 2016, the Company’s corporate structure was as follows:

9

10

Note 2 - SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

This summary of significant accounting policies of the Company is presented to assist in understanding the Company’s financial statements. The financial statements and notes are representations of the Company’s management, which is responsible for their integrity and objectivity. These accounting policies conform to generally accepted accounting principles in the United States ("US GAAP") and have been consistently applied in the preparation of the unaudited condensed consolidated financial statements.

The accompanying unaudited condensed consolidated financial statements have been prepared by Company without audit pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). Certain information and disclosures normally included in financial statements prepared in accordance with US GAAP have been condensed or omitted as allowed by such rules and regulations, and management believes that the disclosures are adequate to make the information presented not misleading. These unaudited condensed consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended June 30, 2016. These unaudited condensed consolidated financial statements include all adjustments, which in the opinion of management are necessary to a fair presentation of financial position and results of operations. All such adjustments are of a normal and recurring nature. The results of operations for the three months ended September 30, 2016 may not be indicative of results that may be expected for the year ended June 30, 2017.

Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements include China Health US and its four subsidiary companies, including China Health HK, Humankind, Huimeijia, and HLJ Huimeijia. All significant intercompany balances and transactions have been eliminated in consolidation and combination.

On November 22, 2013, China Health US, through its wholly owned subsidiary Humankind, completed the acquisition of HLJ Huimeijia. HLJ Huimeijia and Humankind are under the common control of Mr. Xin Sun, the CEO of the Company before and after the date of transfer. Humankind’s accounting policy adopted the guidance in ASC 805-50-05-5 for the transfer of net assets between entities under common control to apply a method similar to the pooling-of-interests method. Under this method, the financial statements of Humankind shall report results of operations for the period in which the transfer occurs as though the transfer of net assets had occurred at the beginning of the period. Results of operations for that period will thus comprise both those of the previously separate entities combined from the beginning of the period to the date the transfer is completed and those of the combined operations from that date to the end of the period. Similarly, Humankind shall present the statements of financial position and other financial information as of the beginning of the period as though the assets and liabilities had been transferred at that date. Financial statements and financial information of Humankind presented for prior years also shall be retrospectively adjusted to furnish comparative information.

11

Reclassifications

Certain prior year balances were reclassified to conform to the current period's presentation with consideration of reflecting Huimeijia business as discontinued operations. None of these reclassifications had an impact on reported financial position or cash flows for any of the periods presented.

Segment Reporting

FASB ASC Topic 280, “Segment Reporting,” established standards for reporting information about operating segments on a basis consistent with the Company's internal organizational structure as well as information about geographical areas, business segments and major customers in financial statements for details on the Company's business segments. The Company has three reportable operating segments: Humankind, HLJ Huimeijia and others. The segments are grouped based on the types of products provided.

Fair Value of Financial Instruments

The provisions of accounting guidance, FASB ASC Topic 820 that applies to the Company requires all entities to disclose the fair value of financial instruments, both assets and liabilities recognized and not recognized on the balance sheets, for which it is practicable to estimate fair value, and defines fair value of a financial instrument as the amount at which the instrument could be exchanged in a current transaction between willing parties.

Fair Value Measurements

FASB ASC Topic 820, “Fair Value Measurements and Disclosures,” clarifies the definition of fair value for financial reporting, establishes a framework for measuring fair value and requires additional disclosures about the use of fair value measurements.

Various inputs are considered when determining the fair value of the Company’s debt. The inputs or methodologies used for valuing securities are not necessarily an indication of the risk associated with investing in these securities. These inputs are summarized in the three broad levels listed below.

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Level 1 –observable market inputs that are unadjusted quoted prices for identical assets or liabilities in active markets.

Level 2 –other significant observable inputs (including quoted prices for similar securities, interest rates, credit risk, etc.).

Level 3 –significant unobservable inputs (including the Company’s own assumptions in determining the fair value of investments).

The carrying value of financial assets and liabilities recorded at fair value is measured on a recurring or nonrecurring basis. Financial assets and liabilities measured on a non-recurring basis are those that are adjusted to fair value when a significant event occurs. The Company had no financial assets or liabilities carried and measured on a nonrecurring basis during the reporting periods. Financial assets and liabilities measured on a recurring basis are those that are adjusted to fair value each time a financial statement is prepared. The Company had no financial assets or liabilities carried and measured on a recurring basis during the reporting periods.

The availability of inputs observable in the market varies from instrument to instrument and depends on a variety of factors including the type of instrument, whether the instrument is actively traded, and other characteristics particular to the transaction. For many financial instruments, pricing inputs are readily observable in the market, the valuation methodology used is widely accepted by market participants, and the valuation does not require significant management discretion. For other financial instruments, pricing inputs are less observable in the market and may require management judgment.

Translation of Foreign Currencies

Humankind, Huimeijia and HLJ Huimeijia maintain their books and accounting records in PRC currency “Renminbi” (“RMB”), which has been determined as the functional currency. Transactions denominated in currencies other than RMB are translated into RMB at the exchange rates prevailing on the date of the transactions, as quoted by the Federal Reserve Board. Foreign currency exchange gains and losses resulting from these transactions are included in operations.

Humankind, Huimeijia and HLJ Huimeijia’s financial statements are translated into the reporting currency, the United States Dollar (“USD”). Assets and liabilities of the above entities are translated at the prevailing exchange rate at each reporting period end date. Contributed capital accounts are translated using the historical rate of exchange when capital is injected. Income and expense accounts are translated at the average rate of exchange during the reporting period. Translation adjustments resulting from the translation of these financial statements are reflected as accumulated other comprehensive income in shareholders’ equity and non-controlling interests.

13

Statement of Cash Flows

In accordance with Statement FASB ASC Topic 230, “Statement of Cash Flows,” cash flow from the Company's operations is calculated based upon the local currencies and translated to the reporting currency using an average foreign exchange rate for the reporting period. As a result, amounts related to assets and liabilities reported in the statement of cash flows will not necessarily agree with changes in the corresponding balances on the balance sheet.

Use of Estimates and Assumptions

The preparation of financial statements in conformity with US GAAP requires management to make estimates and judgments that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities on the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company bases its estimates and judgments on historical experience and on various other assumptions and information that are believed to be reasonable under the circumstances. Estimates and assumptions of future events and their effects cannot be perceived with certainty and, accordingly, these estimates may change as new events occur, as more experience is acquired, as additional information is obtained and as the Company’s operating environment changes. Significant estimates and assumptions by management include, among others; useful lives of long-lived assets and intangible assets, valuation of inventory, accounts receivable and notes receivable, impairment analysis of long-lived assets, construction in progress, intangible assets and deferred taxes. While the Company believes that the estimates and assumptions used in the preparation of the financial statements are appropriate, actual results could differ from those estimates. Estimates and assumptions are periodically reviewed and the effects of revisions are reflected in the financial statements in the period they are determined to be necessary.

Cash and Cash Equivalents

Cash and cash equivalents include cash on hand, deposits in banks with maturities of three months or less, and all highly liquid investments which are unrestricted as to withdrawal or use, and which have original maturities of three months or less at the time of purchase.

As of September 30, 2016 and June 30, 2016, the Company’s uninsured bank balance was mainly maintained at financial institutions located in the PRC and HK. The uninsured bank balances of continuing operations were $20,778,742 and $29,783,152 as of September 30, 2016 and June 30, 2016, respectively. The uninsured bank balances of discontinued operations were $8,549 and $8,578 as of September 30, 2016 and June 30, 2016, respectively. The Company has no insured bank balance as of September 30, 2016 and June 30, 2016, respectively.

14

Accounts Receivable

Accounts receivable are recorded at the invoiced amount and do not bear interest. The Company extends unsecured credit to its customers in the ordinary course of business but mitigates the associated risks by performing credit checks and actively pursuing past due accounts. An allowance for doubtful accounts is established and determined based on management’s assessment of known requirements, aging of receivables, payment and bad debt history, the customer’s current credit worthiness, changes in customer payment patterns and the economic environment. From November 1, 2013, the Company changed its credit policy by offering ninety (90) day payment terms for sales agents, whereas the payment terms for sales agents before November 1, 2013 were thirty (30) day. As of September 30, 2016 and June 30, 2016, the balances of accounts receivable from the continuing operations, were $962,055 and $1,145,131, respectively. As of September 30, 2016 and June 30, 2016, the balances of accounts receivable from discontinued operations, were both nil. The Company determines the allowance based on aging data, historical collection experience, customer specific facts and economic conditions. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company evaluated the nature of all accounts receivable then provided allowance for doubtful accounts. The Company has determined that an allowance of $50,710 and $52,129 from the continuing operations was appropriate as of September 30, 2016 and June 30, 2016, respectively. The Company has determined that an allowance of nil from discontinued operations was appropriate as of September 30, 2016 and June 30, 2016.

Advance to Suppliers

The Company periodically makes advances to certain vendors for purchases of raw materials, or service providers for services relating to construction plans for its plant, equipment and production lines for the GMP upgrading, and records these payments as advance to suppliers. As of September 30, 2016 and June 30, 2016, advance to suppliers, held for continuing operations, amounted to $153,816 and $154,430, respectively. As of September 30, 2016 and June 30, 2016, advance to suppliers, held for discontinued operations, amounted to $556 and $558, respectively.

Inventory

Inventory consists of raw materials, work in progress and finished goods of manufactured products.

Inventory is stated at lower of cost or market and consists of materials, labor and overhead. HLJ Huimeijia uses the weighted average method for inventory valuation. The other entities of the Company use the first-in, first-out (“FIFO”) method for inventory valuation. Overhead costs included in finished goods include direct labor cost and other costs directly applicable to the manufacturing process. The Company evaluates inventory for excess, slow moving, and obsolete inventory as well as inventory the value of which is in excess of its net realizable value. This evaluation includes analysis of sales levels by product and projections of future demand. If future demand or market conditions are less favorable than the Company’s projections, a write-down of inventory may be required, and would be reflected in cost of goods sold in the period the revision is made. There was no inventory allowance, held for continuing operations and discontinued operations, provided for the three months ended September 30, 2016 and 2015, respectively.

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Impairment of Long-Lived Assets

The Company’s long-lived assets and other assets are reviewed for impairment in accordance with the guidance of the FASB ASC Topic 360-10, “Property, Plant, and Equipment,” and FASB ASC Topic 205, “Presentation of Financial Statements.” The Company tests for impairment losses on long-lived assets used in operations whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. Recoverability of an asset to be held and used is measured by a comparison of the carrying amount of the asset to the future undiscounted cash flows expected to be generated by the asset. If such asset is considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the asset exceeds its fair value. Impairment evaluations involve management’s estimates on asset useful lives and future cash flows. Actual useful lives and cash flows could be different from those estimated by management which could have a material effect on the Company’s reporting results and financial position. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. As of September 30, 2016 and June 30, 2016, the Company had not experienced impairment losses on its long-lived assets for both the continuing and discontinued operations. However, there can be no assurances that demand for the Company’s products or services will continue, which could result in an impairment of long-lived assets in the future.

Property, Plant and Equipment

Property, plant and equipment are carried at the lower of cost or fair value. Maintenance, repairs and minor renewals are expensed as incurred, major renewals and improvements that extend the lives or increase the capacity of plant assets are capitalized.

When assets are retired or disposed of, the cost and accumulated depreciation are removed from the accounts, and any resulting gains or losses are included in the results of operations in the reporting period of disposition.

Depreciation is calculated on a straight-line basis over the estimated useful life of the assets. The depreciable lives applied are:

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Building, Warehouse and Improvements	20 to 30 years
Office Equipment	3 to 7 years
Vehicles	5 to15 years
Machinery and Equipment	7 to 15 years

Intangible Assets

The Company evaluates intangible assets in accordance with FASB ASC Topic 350, “Intangibles — Goodwill and Other.” Intangible assets deemed to have indefinite lives are not amortized, but are subject to annual impairment tests. If the assumptions and estimates used to allocate the purchase price are not correct, or if business conditions change, purchase price adjustments or future asset impairment charges could be required. The value of the Company’s intangible assets could be impacted by future adverse changes such as: (i) any future declines in the Company’s operating results, (ii) a decline in the valuation of technology, including the valuation of the Company’s common stock, (iii) a significant slowdown in the worldwide economy, or (iv) any failure to meet the performance projections included in the Company’s forecasts of future operating results. In accordance with FASB ASC Topic 350, the Company tests intangible assets for impairment on an annual basis or more frequently if the Company believes indicators of impairment exist. Impairment evaluations involve management estimates of asset useful lives and future cash flows. Significant management judgment is required in the forecasts of future operating results that are used in the evaluations. It is possible, however, that the plans and estimates used may be incorrect. If the Company’s actual results, or the plans and estimates used in future impairment analysis, are lower than the original estimates used to assess the recoverability of these assets, we could incur additional impairment charges in a future period. Based on such evaluations, there was no impairment recorded for intangible assets, held for both the continuing and discontinued operations, for the three months ended September 30, 2016 and 2015, respectively.

Construction in Progress

Construction in progress represents the costs incurred in connection with the construction of buildings or new additions to the Company’s plant facilities. Costs classified as construction in progress include all costs of obtaining the asset and bringing it to the location and condition necessary for its intended use. No depreciation is provided for construction in progress until such time as the assets are completed and are placed into service.

The Company reviews the carrying value of construction in progress for impairment whenever events and circumstances indicate that the carrying value of an asset may not be recoverable from the estimated future cash flows expected to result from its use and eventual disposition. In cases where undiscounted expected future cash flows are less than the carrying value of the assets, an impairment loss is recognized equal to an amount by which the carrying value exceeds the fair value of the assets. The factors considered by management in performing this assessment include current operating results, trends and prospects, the manner in which the property is used, and the effects of obsolescence, demand, competition and other economic factors. Based on this assessment, there was no impairment recorded for construction in progress, held for both the continuing and discontinued operations, for the three months ended September 30, 2016 and 2015, respectively.

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Revenue Recognition

The Company recognizes revenue when it is both earned and realized or realizable. The Company’s policy is to recognize revenue when title to the product, ownership and risk of loss have transferred to the customer, persuasive evidence of an arrangement exits and collection of the sales proceeds is reasonably assured, all of which generally occur upon shipment of goods to customers. The majority of the Company’s revenue relates to the sale of inventory to customers, and revenue is recognized when title and the risks and rewards of ownership pass to the customer. Given the nature of the Company’s business and the applicable rules guiding revenue recognition, the Company’s revenue recognition practices do not contain estimates that materially affect the results of operations. The Company records revenue at the discounted selling price and allows its customers to return products for exchange or credit subject to certain limitations. A provision for such returns is recorded based upon historical experience. There has been no provision recorded for returns based upon historical experience, held for both the continuing and discontinued operations, for the three months ended September 30, 2016 and 2015, respectively.

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Cost of Goods Sold

Cost of goods sold consists primarily of the costs of raw materials, freight charges, direct labor, depreciation of plants and machinery, warehousing and overhead costs associated with the manufacturing process and commission expenses.

Income Taxes

The Company adopts FASB ASC Topic 740, “Income Taxes,” which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized.

In July 2006, the FASB issued FIN 48(ASC 740-10), “Accounting for Uncertainty in Income Taxes — An Interpretation of FASB Statement No. 109 (ASC 740),” which requires income tax positions to meet a more-likely-than-not recognition threshold to be recognized in the financial statements. Under FIN 48(ASC 740-10), tax positions that previously failed to meet the more-likely-than-not threshold should be recognized in the first subsequent financial reporting period in which that threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not threshold should be derecognized in the first subsequent financial reporting period in which that threshold is no longer met.

As a result of the implementation of FIN 48 (ASC 740-10), the Company undertook a comprehensive review of its portfolio of tax positions in accordance with recognition standards established by FIN 48 (ASC 740-10). The Company recognized no material adjustments to liabilities or stockholders’ equity as a result of the implementation. The adoption of FIN 48 did not have a material impact on the Company’s financial statements.

The application of tax laws and regulations is subject to legal and factual interpretation, judgment and uncertainty. Tax laws and regulations themselves are subject to change as a result of changes in fiscal policy, changes in legislation, the evolution of regulations and court rulings. Therefore, the actual liability may be materially different from the Company’s estimates, which could result in the need to record additional tax liabilities or potentially reverse previously recorded tax liabilities or deferred tax asset valuation allowance.

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Enterprise Income Tax

Under the Provisional Regulations of PRC Concerning Income Tax on Enterprises promulgated by the PRC (the “EIT Law”), income tax is payable by enterprises at a rate of 25% of their taxable income.

Value Added Tax

The Provisional Regulations of PRC Concerning Value Added Tax promulgated by the State Council came into effect on January 1, 1994. Under these regulations and the Implementing Rules of the Provisional Regulations of the PRC Concerning Value Added Tax, value added tax (“VAT”) is imposed on goods sold in, or imported into, the PRC and on processing, repair and replacement services provided within the PRC.

VAT payable in the PRC is charged on an aggregated basis at a rate of 13% or 17% (depending on the type of goods involved) on the full price collected for the goods sold or, in the case of taxable services provided, at a rate of 17% on the charges for the taxable services provided, but excluding, in respect of both goods and services, any amount paid in respect of VAT included in the price or charges, and less any deductible VAT already paid by the taxpayer on purchases of goods and services in the same financial year. As of September 30, 2016 and June 30, 2016 VAT payables from the continuing operations were $197,378 and $183,813, respectively. As of September 30, 2016 and June 30, 2016, VAT payables were both nil for the discontinued operations.

Sales-Related Taxes

Pursuant to the tax law and regulations of the PRC, the Company is obligated to pay 7% and 5% of the annual VAT paid as taxes on maintaining and building cities and education additional fees, both of which belong to sales-related taxes. Sales-related taxes are recorded when sales revenue is recognized. Sales-related taxes from the continuing operations were $22,637 and $33,901 for the three months ended September 30, 2016 and 2015, respectively. Sales-related taxes from the discontinued operations were both nil for the three months ended September 30, 2016 and 2015.

Concentrations of Business and Credit Risks

All of the Company’s manufacturing is located in the PRC. There can be no assurance that the Company will be able to successfully continue to manufacture its products and failure to do so would have a material adverse effect on the Company’s financial position, results of operations and cash flows. Also, the success of the Company’s operations is subject to numerous contingencies, some of which are beyond management’s control. These contingencies include general economic conditions, prices of raw materials, competition, governmental and political conditions, and changes in regulations. Since the Company is dependent on trade in the PRC, the Company is subject to various additional political, economic and other uncertainties. Among other risks, the Company’s operations will be subject to the risks of restrictions on transfer of funds, domestic customs, changing taxation policies, foreign exchange restrictions, and political and governmental regulations.

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The Company operates in China, which may give rise to significant foreign currency risks from fluctuations and the degree of volatility of foreign exchange rates between U.S. dollars and the Chinese currency RMB. The results of operations denominated in foreign currency are translated at the average rate of exchange during the reporting periods.

Earnings Per Share

Basic earnings per common share is computed by dividing net earnings applicable to common shareholders by the weighted-average number of common shares outstanding during the period. When applicable, diluted earnings per common share is determined using the weighted-average number of common shares outstanding during the period, adjusted for the dilutive effect of common stock equivalents, consisting of shares that might be issued upon exercise of common stock options and warrants. For the three months ended September 30, 2016 and 2015, the Company had no potential dilutive common stock equivalents outstanding.

Potential common shares issued are calculated using the treasury stock method, which recognizes the use of proceeds that could be obtained upon the exercise of options and warrants in computing diluted earnings per share. It assumes that any proceeds would be used to purchase common stock at the average market price of the common stock during the period.

FASB ASC Topic 260, “Earnings Per Share,” requires a reconciliation of the numerator and denominator of the basic and diluted earnings per share (EPS) computations.

Recent Accounting Pronouncements

In August 2016, the FASB has issued Accounting Standards Update (“ASU”) No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments, to address diversity in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The amendments provide guidance on the following eight specific cash flow issues: (1) Debt Prepayment or Debt Extinguishment Costs; (2) Settlement of Zero-Coupon Debt Instruments or Other Debt Instruments with Coupon Interest Rates That Are Insignificant in Relation to the Effective Interest Rate of the Borrowing; (3) Contingent Consideration Payments Made after a Business Combination; (4)Proceeds from the Settlement of Insurance Claims; (5) Proceeds from the Settlement of Corporate-Owned Life Insurance Policies, including Bank-Owned; (6) Life Insurance Policies; (7) Distributions Received from Equity Method Investees; (8) Beneficial Interests in Securitization Transactions; and Separately Identifiable Cash Flows and Application of the Predominance Principle. The amendments are effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2019. Early adoption is permitted, including adoption in an interim period. The amendments should be applied using a retrospective transition method to each period presented. If it is impracticable to apply the amendments retrospectively for some of the issues, the amendments for those issues would be applied prospectively as of the earliest date practicable. The Company is currently evaluating the impact of this new standard on its consolidated financial statements and related disclosures.

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In October 2016, the FASB has issued ASU No. 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory. The amendments require an entity to recognize income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs and remove the exception to postpone recognition until the asset has been sold to an outside party. The amendments are effective for public business entities for annual reporting periods beginning after December 15, 2017, including interim reporting periods within those annual reporting periods. For all other entities, the amendments are effective for annual reporting periods beginning after December 15, 2018, and interim reporting periods within annual reporting periods beginning after December 15, 2019. Early adoption is permitted. The Company is currently evaluating the impact of this new standard on its consolidated financial statements and related disclosures.

In October 2016, the FASB has issued ASU No. 2016-17, Consolidation (Topic 810): Interest Held through Related Parties That Are under Common Control, to provide guidance on the evaluation of whether a reporting entity is the primary beneficiary of a VIE by amending how a reporting entity, that is a single decision maker of a VIE, treats indirect interests in that entity held through related parties that are under common control. The amendments are effective for public business entities for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2016, and interim periods within fiscal years beginning after December 15, 2017. Early adoption is permitted, including adoption in an interim period. The Company is currently evaluating the impact of this new standard on its consolidated financial statements and related disclosures.

NOTE 3 - ASSETS SALE

On December 24, 2014, Humankind entered into a stock transfer agreement (the “Original Agreement”) with Xiuzheng Pharmaceutical Group Co., Ltd. a company incorporated under the laws of the People’s Republic of China and located in Jilin province (“Xiuzheng Pharmacy”or the “Buyer”), Mr. Xin Sun, the CEO of the Company, and Huimeijia, pursuant to which, Humankind and Mr. Xin Sun (the “Equity Holders”), shall sell their respective equity interests in Huimeijia to Xiuzheng Pharmacy. The transfer of the 100% equity interests of Huimeijia to the Buyer was for a total cash consideration of RMB 8,000,000 (approximately $1,306,186) to the Equity Holders.

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On February 9, 2015, the four parties entered into a supplementary agreement (the “Supplementary Agreement”) to modify the terms of the Original Agreement, pursuant to which, the Equity Holders and Huimeijia (collectively the “Assets Transferors”) shall only sell the 19 drug approval numbers (including the tablet, capsule, powder, mixture, oral liquid, syrup and oral solution under the 19 approval numbers; licenses including the original copies of Business License, Organization Code Certificate, Tax Registration Certificate, Drug Production Permit and GMP Certificate, and other documents and original copies related to the production and operation of the 19 drugs) (the “Assets”) to Xiuzheng Pharmacy. The Equity Holders will retain the equity interests in Huimeijia, but will have the equity interests pledged to Xiuzheng Pharmacy until the Assets are transferred, at which time all the cash consideration shall be paid by the Buyer. The total cash consideration remains to be the same as under the Original Agreement, i.e., RMB 8,000,000 (approximately $1,306,186) to the Assets Transferors. In the event that the Assets are failed to be transferred to the Buyer due to the fault of the Assets Transferors, the paid consideration shall be returned to the Buyer with interests accrued. If the failure of the transfer of the Assets is a result of the government policy changes or force majeure, the paid cash consideration shall be returned to the Buyer but without any interests.

On October 12, 2016, the four parties agreed to rescind the Supplementary Agreement and entered into a new supplementary agreement (the “Agreement”), pursuant to which, the four parties agreed to execute the transfer of the equity interests based on the Original Agreement, and according to which the Equity Holders shall sell their respective equity interests in Huimeijia to Xiuzheng Pharmacy. The transfer of the 100% equity interests of Huimeijia to the Buyer was for a total cash consideration of RMB 8,000,000 (approximately $1,306,186) (the “Purchase Price”) to the Equity Holders. 40% of the Purchase Price is due within 10 business days after signing the Agreement; 40% of the Purchase Price is due within 10 business days after the completion of the changes in business registration and Xiuzheng Pharmacy obtains the newly issued documents evidencing its ownership on Huimeijia; 15% of the Purchase Price is due within 10 business days after the transfer of all the drugs is approved by Heilongjiang FDA; and 5% of the Purchase Price is due within 10 business days after all the drugs have been transferred to Xiuzheng Pharmacy or its designated entity and Humankind and Mr. Xin Sun instructs Xiuzheng Pharmacy to complete three-batches production of all forms of drugs. As of the date of this report, 40% of the Purchase Price was paid and the Company has completed the changes in business registration and Xiuzheng Pharmacy obtained the newly issued documents evidencing its ownership on Huimeijia, which are evidenced by the business license issued by the local State Administration of Industry and Commerce in Harbin (“Harbin SAIC”) to Huimeijia where the ownership of Huimeijia has now been recorded as held by Xiuzheng Pharmacy with Harbin SAIC and the legal representative (a person that is authorized to take most of the corporate actions on behalf of a company under the corporate laws in China) of Huimeijia has now become a person designated by the Buyer. The transfer of all the drugs to the Buyer and the remainder of the Purchase Price are pending to be processed.

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NOTE 4 - ACCOUNTS RECEIVABLE

The Company’s accounts receivable, held for continuing operations, were $962,055 and $1,145,131, respectively, net of allowance for doubtful accounts amounting to $50,710 and $52,129 as of September 30, 2016 and June 30, 2016, respectively. The Company’s accounts receivable, held for discontinued operations, were both nil, net of allowance for doubtful accounts amounting to nil as of September 30, 2016 and June 30, 2016, respectively.

NOTE 5 - INVENTORY

Inventory from the continuing operations consisted of following:

		September 30,		June 30,
		2016		2016
Raw Materials	$	132,272	$	122,569
Supplies and Packing Materials		135,742		130,472
Work-in-Progress		131,323		118,233
Finished Goods		57,878		48,713
Total		457,215		419,987
Less: Inventory, Held for Discontinued Operations		5,186		5,203
Inventory, Held for Continuing Operations	$	452,029	$	414,784

For the three months ended September 30, 2016 and 2015, the Company has not made provision for inventory from the continued and discontinued operations in regards to excessive, slow moving or obsolete items.

NOTE 6 - CONSTRUCTION IN PROGRESS

Construction in progress from the continuing operations consisted of the following:

		September 30,		June 30,
		2016		2016
Plant - HLJ Huimeijia	$	676,307	$	670,051
Plant and Production Lines - Huimeijia		1,800		1,806
Total		678,107		671,857
Less: Construction in Progress, Held for Discontinued Operations		1,800		1,806
Construction in Progress, Held for Continuing Operations	$	676,307	$	670,051

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On April 6, 2012, HLJ Huimeijia entered into an agreement with a contractor for the plant, the estimated total cost of construction was approximately $2.09 million (RMB 12,800,000), anticipated to be completed by December 2016. As of September 30, 2016, 35% of construction had been completed and $676,307 (RMB 4,509,953) had been recorded as a cost of construction in progress.

NOTE 7 - PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment from the continuing operations consisted of the following:

		September 30,			June 30,
		2016			2016
Building, Warehouses and Improvements	$	4,345,412		$	4,360,191
Machinery and Equipment		1,228,683			1,232,861
Office Equipment		69,095			69,330
Vehicles		203,764			204,457
Less: Accumulated Depreciation		(2,072,636	)		(1,998,278	)
Total		3,774,318			3,868,561
Less: Property and Equipment, net, Held for Discontinued Operations		1,789			1,796
Property and Equipment, net, held for continuing operations	$	3,772,529		$	3,866,765

Depreciation expense from the continuing operations was $81,187 and $85,735 for the three months ended September 30, 2016 and 2015, respectively. Depreciation expense from the discontinued operations was nil and $196 for the three months ended September 30, 2016 and 2015, respectively. Depreciation expense charged to operations from the continuing operations was $37,485 and $34,511 for the three months ended September 30, 2016 and 2015, respectively. Depreciation expense charged to cost of goods sold from the continuing operations was $43,702 and $51,224 for the three months ended September 30, 2016 and 2015, respectively. Depreciation expense charged to operations from the discontinued operations was nil and $196 for the three months ended September 30, 2016 and 2015, respectively. Depreciation expense charged to cost of goods sold from the discontinued operations was both nil for the three months ended September 30, 2016 and 2015, respectively.

As of September 30, 2016, the building of HLJ Huimeijia with the book value of $1,670,945 has been mortgaged for the working capital loan in the principal amount of $1,499,588 (RMB 10,000,000). As of June 30, 2016, the building of HLJ Huimeijia with the book value of $1,676,627 has been mortgaged for the working capital loan in the principal amount of $1,504,687 (RMB 10,000,000).

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NOTE 8 - INTANGIBLE ASSETS

The following is a summary of intangible assets from the continuing operations:

		September 30, 2016			June 30, 2016
Land Use Rights – Humankind	$	950,436		$	953,670
Health Supplement Product Patents – Humankind		4,498,763			4,514,061
Pharmaceutical Patents - HLJ Huimeijia		134,361			134,817
Land Use Rights - HLJ Huimeijia		650,084			652,295
Less: Accumulated Amortization		(2,168,103	)		(2,063,784	)
Total		4,065,541			4,191,059
Less: Intangible Assets, net, Held for Discontinued Operations		-			-
Intangible Assets, net, Held for Continuing Operations	$	4,065,541		$	4,191,059

All land in the PRC belongs to the State. Enterprises and individuals can pay the State a fee to obtain the right to use a piece of land for commercial purposes or residential purposes for an initial period of 50 years or 70 years, respectively. The land use right can be sold, purchased, and exchanged in the market. The successor owner of the land use right will have the right to use the land for the time remaining on the initial period.

Amortization expense from the continuing operations was $111,390 and $147,450 for the three months ended September 30, 2016 and 2015, respectively. Amortization expense from the discontinued operations was both nil for the three months ended September 30, 2016 and 2015.

As of September 30, 2016, land use rights of HLJ Huimeijia with the book value of $650,084 have been mortgaged for a working capital loan in the principal amount of $1,499,588 (RMB 10,000,000). As of June 30, 2016, land use rights of HLJ Huimeijia with the book value of $652,295 have been mortgaged for a working capital loan in the principal amount of $1,504,687 (RMB 10,000,000).

NOTE 9 - SHORT-TERM LOAN

On November 12, 2015, HLJ Huimeijia entered into a short-term loan agreement with a bank for a working capital loan in the principal amount of RMB 10,000,000, at an interest rate of 5.66% from November 12, 2015 to November 10, 2016. The loan was secured by the land use right and the building of HLJ Huimeijia, with a maturity date of November 10, 2016. As of September 30, 2016 and June 30, 2016, the Company’s short-term loan from the continuing operations was $1,499,588 and $1,504,687, respectively. As of September 30, 2016 and June 30, 2016, the Company’s short-term loan from the discontinued operations was both nil.

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Interest expenses from the continuing operations were $21,686 and $31,624 for the three months ended September 30, 2016 and 2015, respectively. Interest expenses from the discontinued operations were both nil for the three months ended September 30, 2016 and 2015, respectively.

NOTE 10 - RELATED PARTY DEBTS

Related party debts, which represent temporary short-term loans from Mr. Xin Sun and Mr. Kai Sun, consisted of the following:

		September 30, 2016		June 30, 2016
Mr. Xin Sun	$	2,755,786	$	2,678,220
Mr. Kai Sun		35,066		35,186
Total		2,790,852		2,713,406
Less: Related Party Debts, Held for Discontinued Operations		-		-
Related Party Debts, Held for Continuing Operations	$	2,790,852	$	2,713,406

These loans are unsecured and non-interest bearing and have no fixed terms of repayment; therefore, they are deemed payable on demand. Mr. Kai Sun is a PRC citizen and a family member of Mr. Xin Sun, the CEO of the Company.

NOTE 11 - INCOME TAXES

(a) Corporate income taxes

United States

China Health US was organized in the United States. China Health US had no taxable income for US income tax purposes for the three months ended September 30, 2016 and 2015, respectively. As of September 30, 2016, China Health US has a net operating loss carry forward for United States income taxes. Net operating loss carry forwards are available to reduce future years’ taxable income. Management believes that the realization of the benefits from these losses appears uncertain due to the Company’s operating history and the continued losses of the US entity. Accordingly, the Company has provided a 100% valuation allowance on the deferred tax asset to reduce the asset to zero. There were no changes in the valuation allowance for the three months ended September 30, 2016 and 2015. Management reviews this valuation allowance periodically and makes adjustments accordingly.

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Hong Kong

China Health HK was incorporated in Hong Kong and is subject to Hong Kong taxation on its activities conducted in Hong Kong and income arising in or derived from Hong Kong. No provision for income taxes have been made as China Health HK has no taxable income in Hong Kong.

People’s Republic of China

Under the EIT Law, the standard EIT rate is 25%. The PRC subsidiaries of the Company are subject to PRC income taxes on an entity basis on income arising in or derived from the tax jurisdiction in which they operate.

The provision for income taxes from the continuing operations consisted of the following for the three months ended September 30, 2016 and 2015:

		For the Three Months Ended
		September 30,
		2016		2015
Current provision:
USA	$	-	$	-
China		54,030		32,406
Total current provision		54,030		32,406
Deferred provision:
USA		-		-
China		-		-
Total deferred provision		-		-
Total provision for income taxes		54,030		32,406
Less: Provision for income taxes, held for discontinued operations		-		-
Provision for income taxes, held for continuing operations	$	54,030	$	32,406

Significant components of deferred tax assets from the continuing operations were as follows:

		September 30,			June 30,
		2016			2016
Deferred tax assets
Net operating loss carry forward	$	112,236		$	118,259
Allowance for doubtful accounts		-			-
Valuation allowance		(112,236	)		(118,259	)
Deferred tax assets, net		-			-
Less: Deferred tax assets, net, held for discontinued operations		-			-
Deferred tax assets, net, held for continuing operations	$	-		$	-

As of September 30, 2016 and June 30, 2016, the Company accrued a 100% valuation allowance on its deferred tax assets based on the assessment on the probability of future reversion.

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(b) Uncertain tax positions

There were no unrecognized tax benefits as of September 30, 2016 and June 30, 2016, respectively. Management does not anticipate any potential future adjustments in the next twelve months which would result in a material change to its tax positions. For the three months ended September 30, 2016 and 2015, the Company did not incur any interest and penalties arising from its tax payments.

NOTE 12 - COMMITMENTS AND CONTINGENCIES

The Company’s assets are located in the PRC and revenues are derived from operations in the PRC.

In terms of industry regulations and policies, the economy of the PRC has been transitioning from a planned economy to market oriented economy. Although in recent years the Chinese government has implemented measures emphasizing the utilization of market forces for economic reforms, the reduction of state ownership of productive assets and the establishment of sound corporate governance in business enterprises, a substantial portion of productive assets in the PRC is still owned by the Chinese government. For example, all land is state owned and leased to business entities or individuals through the government’s granting of Land Use Rights. The granting process is typically based on government policies at the time of granting and can be lengthy and complex. This process may adversely affect the Company’s future manufacturing expansions. The Chinese government also exercises significant control over the PRC’s economic growth through the allocation of resources and providing preferential treatment to particular industries or companies. Uncertainties may arise with changing of governmental policies and measures.

The Company faces a number of risks and challenges not typically associated with companies in North America or Western Europe, since its assets exist solely in the PRC, and its revenues are derived from its operations therein. The PRC is a developing country with an early stage market economic system, overshadowed by the state. Its political and economic systems are very different from the more developed countries and are in a state of change. The PRC also faces many social, economic and political challenges that may produce major shocks, instabilities and even crises, in both its domestic arena and in its relationships with other countries, including the United States. Such shocks, instabilities and crises may in turn significantly and negatively affect the Company’s performance.

Since the Company terminated its rental agreement on January 9, 2013, it had no rental commitment as of September 30, 2016.

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NOTE 13 - MAJOR SUPPLIERS AND CUSTOMERS

For the three months ended September 30, 2016, the Company had two suppliers that in the aggregate accounted for 88% of the Company’s purchases for the continuing operations, with each supplier accounting for 78% and 10%, respectively.

For the three months ended September 30, 2015, the Company had one supplier that in the aggregate accounted for 75% of the Company’s purchases for the continuing operations.

For the three months ended September 30, 2016, the Company had six customers that in the aggregate accounted for 81% of the Company’s total sales for the continuing operations, with each customer accounting for 16%, 15%, 13%, 13%, 12% and 12%, respectively.

For the three months ended September 30, 2015, the Company had four customers that in the aggregate accounted for 42% of the Company’s total sales for the continuing operations, with each customer accounting for 11%, 11%, 10% and 10%, respectively.

NOTE 14 - SEGMENT REPORTING

The Company was organized into three main business segments based on the types of products being provided to customers: HLJ Huimeijia, Humankind and others. Each of the three operating segments referenced above has separate and distinct general ledgers. The chief operating decision maker (“CODM”) receives financial information, including revenue, gross margin, operating income, and net income produced from the various general ledger systems to make decisions about allocating resources and assessing performance; however, the principal measure of segment profitability or loss used by the CODM is net loss by segment. The discontinued Huimeijia business was included in others segment.

The following tables present summary information by segment for the three months ended September 30, 2016 and 2015, respectively:

		For the Three Months Ended September 30, 2016										For the Three Months Ended September 30, 2015
										Consolidated										Consolidated
										from										from
		HLJ								continuing		HLJ								continuing
		Huimeijia			Humankind		Others			operations		Huimeijia			Humankind		Others			operations
Revenues	$	100		$	1,180,068	$	-		$	1,180,168	$	293,756		$	1,662,312	$	-		$	1,956,068
Cost of revenues		58			755,227		-			755,285		250,346			1,168,618		-			1,418,964
Gross profit		42			424,841		-			424,883		43,410			493,694		-			537,104
Interest expense		21,686			-		-			21,686		31,624			-		-			31,624
Depreciation and amortization		14,230			134,645		-			148,875		18,792			163,169		-			181,961
Income tax		-			54,030		-			54,030		-			32,406		-			32,406
Net income (loss)		(137,873	)		162,091		(195	)		24,023		(127,282	)		97,216		(74	)		(30,140	)
Total capital expenditures		-			-		-			-		-			454		-			454
Total assets	$	2,922,517		$	37,194,994	$	1,444		$	40,118,955	$	3,282,095		$	37,246,334	$	2,024		$	40,530,453

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		For the Three Months Ended				For the Three Months Ended
		September 30, 2016				September 30, 2015
				Consolidated from					Consolidated from
				discontinued					discontinued
		Huimeijia		operations		Huimeijia			operations
Revenues	$	-	$	-	$	-		$	-
Cost of revenues		-		-		-			-
Gross profit		-		-		-			-
Interest expense		-		-		-			-
Depreciation and amortization		-		-		196			196
Income tax		-		-		-			-
Net loss		-		-		(196	)		(196	)
Total capital expenditures		-		-		-			-
Total assets	$	17,880	$	17,880	$	19,341		$	19,341

NOTE 15 - DISCONTINUED OPERATIONS

In accordance with ASU No. 2014-08, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity, a disposal of a component of an entity or a group of components of an entity is required to be reported as discontinued operations if the disposal represents a strategic shift that has (or will have) a major effect on an entity’s operations and financial results when the components of an entity meets the criteria in paragraph 205-20-45-1E to be classified as held for sale. When all of the criteria to be classified as held for sale are met, including management, having the authority to approve the action, commits to a plan to sell the entity, the major current assets, other assets, current liabilities, and noncurrent liabilities shall be reported as components of total assets and liabilities separate from those balances of the continuing operations. At the same time, the results of all discontinued operations, less applicable income taxes (benefit), shall be reported as a component of net income (loss) separate from the net income (loss) of continued operations in accordance with ASC 205-20-45.

Reconciliation of the carrying amounts of major classes of assets and liabilities of discontinued operations classified as discontinued operations in the unaudited condensed consolidated balance sheets.

		September 30, 2016			June 30, 2016
ASSETS
Current Assets
Cash and cash equivalents	$	8,549		$	8,578
Inventory		5,186			5,203
Advance to suppliers		556			558
Total Current Assets		14,291			14,339
Property, plant and equipment, net		1,789			1,796
Construction in progress		1,800			1,806
Total Assets	$	17,880		$	17,941
LIABILITIES AND EQUITY
Current Liabilities:	$			$
Accounts payable and accrued expenses		556			558
Other payables		20			16
Advance from customers		479,868			481,500
Taxes payable		(60	)		(61	)
Total Current Liabilities		480,384			482,013
Total Liabilities	$	480,384		$	482,013

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Reconciliation of the carrying amounts of major classes of net income (loss) from operations to be disposed classified as discontinued operations in the unaudited condensed consolidated statements of operations and comprehensive income (loss).

		For the Three Months Ended
		September 30,
		2016		2015
Operating Expenses
Depreciation and amortization expenses	$	-	$	(196	)
Total Operating Expenses		-		(196	)
Loss from Operations		-		(196	)
Loss before Income Taxes		-		(196	)
Net Loss from Discontinued Operations	$	-	$	(196	)

NOTE 16 - SUBSEQUENT EVENTS

On October 12, 2016, Humankind, Xiuzheng Pharmacy, Mr. Xin Sun and Huimeijia agreed to rescind the Supplementary Agreement which was entered into on February 9, 2015. Meanwhile, the four parties entered into a new supplementary agreement, pursuant to which, Humankind and Mr. Xin Sun shall sell their respective equity interests in Huimeijia to Xiuzheng Pharmacy. Please refer to “NOTE 3 – ASSETS SALE”.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

FORWARD LOOKING STATEMENTS

We make certain forward-looking statements in this report. Statements concerning our future operations, prospects, strategies, financial condition, future economic performance (including growth and earnings), demand for our services, and other statements of our plans, beliefs, or expectations, including the statements contained under this caption as well as captions elsewhere in this document, are forward-looking statements. In some cases, these statements are identifiable through the use of words such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “plan,” “project,” “target,” “can,” “could,” “may,” “should,” “will,” “would,” and similar expressions. The forward-looking statements we make are not guarantees of future performance and are subject to various assumptions, risks, and other factors that could cause actual results to differ materially from those suggested by these forward-looking statements. These risks and uncertainties, together with the other risks described from time to time in reports and documents that we file with the SEC should be considered in evaluating forward-looking statements. Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by the forward-looking statements. Indeed, it is likely that some of our assumptions will prove to be incorrect. Our actual results and financial position will vary from those projected or implied in the forward-looking statements and the variances may be material. You are cautioned not to place undue reliance on such forward-looking statements, which reflect our view only as of the date of this report.

Important factors that could cause actual results to differ from those in the forward-looking statements include, without limitation, the following:

• the effect of political, economic, and market conditions and geopolitical events;

• legislative and regulatory changes that affect our business;

• the availability of funds and working capital; and

• the actions and initiatives of current and potential competitors.

Except as required by applicable laws, regulations or rules, we do not undertake any responsibility to publicly release any revisions to these forward-looking statements to take into account events or circumstances that occur after the date of this report. Additionally, we do not undertake any responsibility to update you on the occurrence of any unanticipated events which may cause actual results to differ from those expressed or implied by any forward-looking statements.

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The following discussion and analysis should be read in conjunction with our unaudited condensed consolidated financial statements and the related notes thereto as filed with the SEC and other financial information contained elsewhere in this report.

Except as otherwise indicated by the context, references in this report to “we,” “us,” “our,” “the Registrant,” “our Company,” or “the Company” are to China Health Industries Holdings, Inc., a Delaware corporation, China Health Industries Holdings Limited, a corporation incorporated under the laws of Hong Kong, its wholly owned subsidiary in China, Harbin Humankind Biology Technology Co. Limited (“Humankind”) and indirect 99% owned subsidiary, Harbin Huimeijia Medicine Company (“Huimeijia”) and indirect wholly owned subsidiary, Heilongjiang Huimeijia Pharmaceutical Co., Ltd. (“HLJ Huimeijia”). Unless the context otherwise requires, all references to (i) “PRC” and “China” are to the People’s Republic of China; (ii) “U.S. dollar,” “$” and “US$” are to United States dollars; (iii) “RMB” are to Renminbi Yuan of China; (iv) “Securities Act” are to the Securities Act of 1933, as amended; and (v) “Exchange Act” are to the Securities Exchange Act of 1934, as amended.

Business Overview

Our principal business operations are conducted through our wholly-owned subsidiaries, Humankind and HLJ Huimeijia.

The Company owns a GMP-certified plant and facilities and has the capacity to produce 21 CFDA-approved medicines and 14 CFDA-approved health supplement products in soft capsule, hard capsule, tablet, granule and oral liquid forms. These products address the needs of some key sectors in China, including the feminine, geriatric and children’s markets.

HLJ Huimeijia's current certificate of GMP expired by the end of December 2015. HLJ Huimeijia has applied a new certificate of GMP, which is expected to be obtained in April 2017. However, there is no assurance that we will obtain the new GMP certificate by such time. According to the law of PRC, HLJ Huimeijia must cease all production activities before getting the new GMP certificate. The equipment and production line is being reconstructed from the third quarter of the fiscal year 2016 to the third quarter of the fiscal year 2017 for the purpose of applying for the new GMP certificate. Although HLJ Huimeijia could sell inventory produced before obtaining the new GMP certificate, management anticipates there will be no or very little revenue generated by HLJ Huimeijia after the expiration of the old GMP certificate.

On December 24, 2014, Humankind, Xiuzheng Pharmacy (the “Buyer”), Mr. Xin Sun and Huimeijia entered into a Stock Transfer Agreement (the “Original Agreement”), pursuant to which, Humankind and Mr. Xin Sun (the “Equity Holders”) shall sell their respective equity interests in Huimeijia to Xiuzheng Pharmacy. On February 9, 2015, the four parties entered into a Supplementary Agreement (the “Supplementary Agreement”) to modify the terms of the Original Agreement, pursuant to which, the Equity Holders and Huimeijia shall only sell the 19 drug approval numbers (the “Assets”) to Xiuzheng Pharmacy. The Equity Holders will retain the equity interests in Huimeijia, but will have the equity interests pledged to Xiuzheng Pharmacy until the Assets are transferred. On October 12, 2016, the four parties agreed to rescind the Supplementary Agreement and entered into a new supplementary agreement, pursuant to which, the four parties agreed to execute the transfer of the equity interests based on the Original Agreement, and according to which the Equity Holders shall sell their respective equity interests in Huimeijia to Xiuzheng Pharmacy for a total cash consideration of RMB 8,000,000 (approximately $1,306,186) (the “Purchase Price”) to the Equity Holders. As of the date of this report, 40% of the Purchase Price was paid and the Company has completed the changes in business registration and Xiuzheng Pharmacy obtained the newly issued document evidencing its ownership on Huimeijia, which is the business license issued by the local State Administration of Industry and Commerce in Harbin (“Harbin SAIC”) to Huimeijia where the ownership of Huimeijia has now been recorded as held by Xiuzheng Pharmacy with Harbin SAIC and the legal representative (a person that is authorized to take most of the corporate actions on behalf of a company under the corporate laws in China) of Huimeijia has now become a person designated by the Buyer. The transfer of all the drugs to the Buyer and the remainder of the Purchase Price are pending to be processed. As of September 30, 2016, the results of operations of Huimeijia business are reflected in the Company’s unaudited condensed consolidated financial statements as discontinued operations.

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Our business is conducted through our sales agents and sales personnel. We sell our products directly to end customers by our own sales personnel as well as our sales agents, operating primarily in Jiangsu, Zhejiang, Shanghai, Beijing, Anhui and Gansu, where most of our revenues are generated. Our sales through agents in Beijing, Zhejiang, Jiangsu, Shanghai, Anhui and Gansu provinces accounted for 16%, 15%, 13%, 13%, 12% and 12% of our total sales from the continuing operations, respectively, for the three months ended September 30, 2016. Although we do not currently sell our products online, we expect to do so in the future.

Results of Operations

The following table summarizes the top lines of the results of our operations from the continuing operations for the three months ended September 30, 2016 and 2015, respectively:

		September 30,		September 30,
		2016		2015		Variance		%
Revenues	$	1,180,168	$	1,956,068	$	(775,900	)	(39.67%	)
Humankind		1,180,068		1,662,312		(482,244	)	(29.01%	)
HLJ Huimeijia		100		293,756		(293,656	)	(99.97%	)
Cost of Goods Sold	$	755,285	$	1,418,964	$	(663,679	)	(46.77%	)
Humankind		755,227		1,168,618		(413,391	)	(35.37%	)
HLJ Huimeijia		58		250,346		(250,288	)	(99.98%	)
Gross Profit	$	424,883	$	537,104	$	(112,221	)	(20.89%	)
Humankind		424,841		493,694		(68,853	)	(13.95%	)
HLJ Huimeijia		42		43,410		(43,368	)	(99.90%	)

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Revenue

Total revenues from the continuing operations decreased by $775,900 or 39.67% for the three months ended September 30, 2016 as compared to the same period in 2015. The decrease in revenues was primarily due to a decrease of $482,244 or 29.01% in Humankind’s revenues and a decrease of $293,656 or 99.97% in HLJ Huimeijia’s revenues for the three months ended September 30, 2016 as compared to the same period in 2015. The decrease of the sales revenue in Humankind was primarily due to the decrease in sales volume of Waterlilies Soft Capsule, which was caused by our shift of marketing focus from such product to Propolis and Black Ant Capsule. The decrease of the sales revenue in HLJ Huimeijia was primary due to the expiration of its GMP certificate on December 31, 2015. During the last three months prior to such an expiration date, HLJ Huimeijia reduced its production and marketing operation as more attention was paid to the preparation of manufacturing and technical improvement in order to meet the requirements for obtaining a new GMP certificate. Since the third quarter of fiscal year 2016, HLJ Huimeijia has ceased all production activities, reconstructed its equipment and production line for the purpose of applying for the new GMP certificate while selling inventory produced before the expiration of the GMP certificate.

Our total cost of sales from the continuing operations decreased by $663,679 or 46.77% for the three months ended September 30, 2016 as compared to the same period in 2015. The decrease in cost of sales was primarily due to a decrease of $413,391 or 35.37% in Humankind’s cost of sales and a decrease of $250,288 or 99.98% in HLJ Huimeijia’s cost of sales for the three months ended September 30, 2016 as compared to the same period in 2015, which were primarily due to the decrease in sales volume of Humankind and HLJ Huimeijia.

Our gross margin from the continuing operations decreased by $112,221 from $537,104 for the three months ended September 30, 2015 to $424,883 for the three months ended September 30, 2016. This decrease was mainly due to the decrease in sales volume of Humankind and HLJ Huimeijia as discussed above.

Sales by Product Line

The following table summarizes a breakdown of our sales by major product line from the continuing operations for the three months ended September 30, 2016 and 2015, respectively:

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	September 30, 2016				September 30, 2015
	Quantity			% of	Quantity			% of
	(Unit)		Sales US$	Sales	(Unit)		Sales US$	Sales
Humankind
Waterlilies Soft Capsule (Sailuozhi)	4,389	$	269,847	22.87%	16,188	$	1,050,585	53.71%
Propolis and Black Ant Capsule	32,925		910,215	77.13%	20,828		611,727	31.27%
HLJ Huimeijia
Muskiness Bone Strengthener Paste	59		24	-	492,048		129,182	6.60%
Muskiness Pain Relieving Paste	21		9	-	197,265		46,522	2.38%
Injury and Rheumatism relieving Paste	68		28	-	93,163		25,434	1.30%
Refining GouPi Cream	15		6	-	144,665		48,645	2.49%
Enema Glycerini	-		-	-	408,278		41,428	2.12%
Umguentum Acidi Borici Camphoratum	10		3	-	2,160		732	0.04%
Indometacin and Furazolidone Suppositories	-		7	-	1,100		450	0.02%
Ge Hong Beriberi Water	92		29	-	4,625		1,363	0.07%
Total		$	1,180,168	100.00%		$	1,956,068	100.00%

Operating Expenses

The following table summarizes our operating expenses from the continuing operations for the three months ended September 30, 2016 and 2015, respectively:

		September 30, 2016		September 30, 2015		Variance		%
Operating Expenses
Selling, general and administrative	$	430,264	$	348,879	$	81,385		23.33%
Depreciation and amortization		148,875		181,961		(33,086	)	(18.18%	)
Total Operating Expenses	$	579,139	$	530,840	$	48,299		9.10%

Total operating expenses from the continuing operations for the three months ended September 30, 2016 increased by $48,299 or 9.10%, as compared to the corresponding period in 2015. The increase in operating expenses was primarily attributable to an increase of $81,385 or 23.33% in selling, general and administrative expenses, partly offset by a decrease of $33,086 or 18.18% in depreciation and amortization expenses. The increase in selling, general and administrative expenses was mainly due to the increased professional fees and increased salaries for management for the three months ended September 30, 2016 as compared to the same period in 2015. The decreased in depreciation and amortization expenses was primarily due to the disposal of property, plant and equipment of HLJ Huimeijia incurred during the second quarter of fiscal year 2016.

Total operating expenses from the discontinued operations decreased from $196 for the three months ended September 30, 2015 to nil for the corresponding period in 2016.

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Interest Income and Interest Expense

Interest income from the continuing operations was $19,909 for the three months ended September 30, 2016, as compared to $18,107 for the three months ended September 30, 2015. This increase of $1,802, or 9.95%, was mainly due to the increased average balance of bank deposits compared with the same period of 2015.

Interest expense from the continuing operations was $21,686 for the three months ended September 30, 2016, a decrease of $9,938 or 31.43%, as compared to $31,624 for the three months ended September 30, 2015. The decrease of interest expense was mainly due to the decrease of short-term loan interest rate.

Investment Income

During the three months ended September 30, 2016, investment income from the continuing operations was $225,093, as compared to nil for the same period in 2015. On July 5, 2016, our Company entered into a one-year financial management agreement with the principal in the amount of $8,997,526 (RMB 60,000,000) at the expected annual rate of return of 10%.

Income Taxes

Income taxes from the continuing operations increased by $21,624, or 66.73%, from $32,406 for the three months ended September 30, 2015 to $54,030 for the three months ended September 30, 2016. This increase was due to the increase in income before income taxes of one of the Company’s subsidiaries, Humankind, with an increase from $129,622 for the three months ended September 30, 2015 to $216,121 for the same period of 2016.

Net Income (Loss) from Continuing Operations and Income (Loss) Per Share

Net income from the continuing operations was $24,023 for the three months ended September 30, 2016, as compared to net loss of $30,140 for the three months ended September 30, 2015. This increase of $54,163, or 179.70% in net income was primarily attributable to an increase in investment income in the amount of $225,093 and a decrease in depreciation and amortization expense in the amount of $33,086, partially offset by a decrease in gross profit of $112,221 and an increase in selling, general and administrative expenses of $81,385 for the three months ended September 30, 2016 as compared to the same period of 2015.

Income per share was $0.0004 for the three months ended September 30, 2016 and loss per share was $0.0005 for the three months ended September 30, 2015, respectively. This increase was primarily a result of the above increase in net income.

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Net Loss from Discontinued Operations

Net loss from the discontinued operations was nil for the three months ended September 30, 2016, as compared to $196 for the three months ended September 30, 2015.

Net Income (Loss)

As a result of the foregoing, we had net income of $24,023 for the three months ended September 30, 2016, compared to net loss of $30,336 for the same period in 2015. After deduction of non-controlling interest in loss, net income attributable to the China Health Industries Holdings was $24,023 for the three months September 30, 2016, and net loss attributable to the China Health Industries Holdings was $30,334 for the same period in 2015.

Liquidity and Capital Resources

We believe our current working capital position, together with our expected future cash flows from operations, loans from our major shareholder, will be adequate to fund our operations in the ordinary course of business, anticipated capital expenditures, debt payment requirements and other contractual obligations for at least the next twelve months. However, this belief is based upon many assumptions and is subject to numerous risks, and there can be no assurance that we will not require additional funding in the future.

The following table summarizes our cash and cash equivalents position, our working capital, and our cash flow activities from the continuing operations as of September 30, 2016 and June 30, 2016 and for the three months ended September 30, 2016 and 2015:

		September 30, 2016			June 30, 2016
Cash and cash equivalents	$	20,778,742		$	29,783,152
Working capital	$	25,638,029		$	25,518,206
Inventories	$	452,029		$	414,784
		2016			2015
For the three months ended September 30:
Cash provided by (used in):
Operating activities	$	15,744		$	210,290
Investing activities	$	(9,010,455	)	$	(28,182	)
Financing activities	$	85,085		$	49,181

For the three months ended September 30, 2016, our net decrease in cash and cash equivalents from the continuing operations totaled $9,004,410, which comprised of net cash used in investing activities in the amount of $9,010,455 and the negative effect of prevailing exchange rates on our cash position of $94,784, offset by net cash provided by operating activities in the amount of $15,744 and net cash provided by financing activities in the amount of $85,085.

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For the three months ended September 30, 2015, our net decrease in cash and cash equivalents from the continuing operations totaled $287,478, which comprised of net cash used in investing activities in the amount of $28,182 and the negative effect of prevailing exchange rates on our cash position of $518,767, offset by net cash provided by operating activities in the amount of $210,290 and net cash provided by financing activities in the amount of $49,181.

Our working capital from continuing operations at September 30, 2016 was $25,638,029, compared to working capital of $25,518,206 at June 30, 2016. This increase of $119,823 or 0.47% was primarily attributable to the increase in interest receivable in the amount of $224,938 and the decrease in taxes payable in the amount of $144,770, offset by the decrease in accounts receivable in the amount of $183,076 and the increase in related party debts in the amount of $77,446.

Net cash provided by operating activities from the continuing operations was $15,744 for the three months ended September 30, 2016, primarily attributable to a decrease in accounts receivable of $178,748, partially offset by an increase in taxes payable of $143,283. Net cash used in investing activities from the continuing operations was $9,010,455 for the three months ended September 30, 2016, primarily due to the expenditure in short-term investment of $9,003,737. Net cash provided by financing activities from continuing operations was $85,085 for the three months ended September 30, 2016, attributable to proceeds from related party debts in the amount of $85,085. The negative effect of exchange rate changes on cash and cash equivalents in the amount of $94,784 for the three months ended September 30, 2016 was mainly a result of the effect of the devaluation of the RMB to the USD on the significant amount of cash and cash equivalents held by the Company in RMB. The exchange rates from USD to RMB were 6.6685 to 1 and 6.6459 to 1 as of September 30, 2016 and June 30, 2016, respectively, and the average exchange rate from USD to RMB was 6.6639 for the three months ended September 30, 2016.

Net cash provided by operating activities from continuing operations was $210,290 for the three months ended September 30, 2015, primarily attributable to net loss attribute to the Company from continuing operations in the amount of $30,138, depreciation and amortization expenses of $233,185 as reconciled, as well as an increase in accounts payables and accrued expenses of $61,205, offset by a decrease in wages payable with an amount of $85,462. Net cash provided by financing activities from continuing operations was $49,181 for the three months ended September 30, 2015, attributable to collections of related party debts in the amount of $49,181. The negative effect of exchange rate changes on cash and cash equivalents in the amount of $518,767 for the three months ended September 30, 2015 was mainly a result of the effect of the devaluation of the RMB to the USD on the significant amount of cash and cash equivalents held by the Company in RMB. The exchange rates from USD to RMB were 6.3556 to 1 and 6.2000 to 1 as of September 30, 2015 and June 30, 2015, respectively, and the average exchange rate from USD to RMB was 6.3033 for the three months ended September 30, 2015.

43

Other than as described in this report, we have no present agreements or commitments with respect to any material acquisitions of businesses, products, product rights or technologies or any other material capital expenditures. However, we will continue to evaluate acquisitions of, and/or investments in, products, technologies, capital equipment or improvements or companies that complement our business and may make such acquisitions and/or investments in the future. Accordingly, we may need to obtain additional sources of capital in the future to finance any such acquisitions and/or investments. We may not be able to obtain such financing on commercially reasonable terms, if at all. Even if we are able to obtain additional financing, it may contain undue restrictions on our operations, in the case of debt financing, or cause substantial dilution for our stockholders, in the case of equity financing.

Related Party Debts

We had related party debts from the continuing operations in the amount of $2,790,852 as of September 30, 2016, as compared to $2,713,406 as of June 30, 2016, an increase of $77,446 or 2.85% . The amount of related party debts mainly consists of a loan from Mr. Xin Sun, the CEO of the Company. The loan is unsecured and non-interest bearing and has no fixed terms of repayment. There was no written agreement for the loan. See Note 10.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements that are currently material or reasonably likely to be material to our financial position or results of operations.

Critical Accounting Policies and Estimates

We prepare the unaudited condensed consolidated financial statements in accordance with US GAAP. These accounting principles require us to make judgments, estimates and assumptions on the reported amounts of assets and liabilities at the end of each fiscal period, and the reported amounts of revenues and expenses during each fiscal period. We continually evaluate these judgments and estimates based on our own historical experience, knowledge and assessment of current business and other conditions, our expectations regarding the future based on available information and assumptions that we believe to be reasonable.

There have been no material changes during the three months ended September 30, 2016 in the Company’s significant accounting policies to those previously disclosed in the annual report on Form 10-K for the fiscal year ended June 30, 2016.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Not applicable.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We maintain a set of disclosure controls and procedures designed to ensure that information required to be disclosed by us in our reports filed under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized and reported within the time periods specified by the SEC’s rules and forms. Disclosure controls are also designed with the objective of ensuring that this information is accumulated and communicated to our management, including our chief executive and chief financial officer, as appropriate, to allow timely decisions regarding required disclosure.

At the conclusion of the period ended September 30, 2016, we carried out an evaluation, under the supervision and with the participation of our management, including our principal executive and principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act.) Based upon that evaluation, our principal executive and principal financial officer concluded that, due to the material weakness in our internal control over financial reporting as discussed in our annual report on Form 10-K for the fiscal year ended June 30, 2016, as of the end of the period covered by this Quarterly Report on Form 10-Q, our disclosure controls and procedures were not effective to satisfy the objectives for which they are intended.

Despite the material weakness reported above, our management believes that our unaudited condensed consolidated financial statements included in this report fairly present in all material respects our financial condition, results of operations and cash flows for the periods presented due to the fact that we have retained a consultant who has U.S. GAAP experience to assist us in the preparation of our unaudited condensed consolidated financial statements.

Changes in Internal Control over Financial Reporting

No changes in our internal control over financial reporting have come to management’s attention during the quarter ended September 30, 2016 that have materially affected, or are likely to materially affect, our internal control over financial reporting.

Limitations on Controls

Management does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent or detect all error and fraud. Any control system, no matter how well designed and operated, is based upon certain assumptions and can provide only reasonable, not absolute, assurance that its objectives will be met. Further, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been detected.

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PART II - OTHER INFORMATION

Item 6. Exhibits.

The exhibits required by this item are set forth in the Exhibit Index attached hereto.

45

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

CHINA HEALTH INDUSTRIES HOLDINGS, INC.
/s/ Xin Sun
By:	Xin Sun
Title:	Chief Executive Officer and Chief Financial Officer
	(Principal Executive Officer, Principal Financial Officer
	and Principal Accounting Officer)
Date:	November 14, 2016

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EXHIBIT INDEX

Exhibit No.	Description
10.1	English translation of the second supplementary agreement, dated October 12, 2016 to stock transfer agreement dated December 24, 2014, by and among Harbin Humankind Biology Technology Co., Limited., Xin Sun, Harbin Huimeijia Medicine Company, and Xiuzheng Pharmaceutical Group Co., Ltd.
31.1	Certification of the Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of the Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of the Principal Executive Officer and the Principal Financial Officer pursuant to U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document

47

EX-10.1

Supplementary Agreement

Party A: Xiuzheng Pharmaceutical Group Co., Ltd

Party B: Harbin Humankind Biology Technology Co., Limited

Party C: Xin Sun

Party D: Harbin Huimeijia Medicine Company

On December 24, 2014, Party A, Party B, Party C, and Party D (the “Four Parties”) entered into a stock transfer agreement (the “Stock Transfer Agreement”) and on February 9, 2015, the Four Parties entered into a supplementary agreement (the “2015 Supplementary Agreement”). In order to accelerate the transfer of core assets, the Four Parties entered into the following terms after friendly negotiation.

I. The Four Parties agreed to rescind the 2015 Supplementary Agreement signed on February 9, 2015.

II. The Four Parties agreed to execute the transfer based on the Stock Transfer Agreement signed on December 24, 2014.

III. This Agreement is executed in four copies. Each party holds one copy. This Agreement is taken into effect after the undersigned sign or seal on the Agreement.

1

Party A: Xiuzheng Pharmaceutical Group Co., Ltd (seal)
/s/ Jianzhong Wang (corporate seal affixed)
Date: October 12, 2016

Party B: Harbin Humankind Biology Technology Co., Limited (seal)
(corporate seal affixed)
Date: October 12, 2016

Party C: Xin Sun

/s/ Xin Sun
Date: October 12, 2016

Party D: Harbin Huimeijia Medicine Company (seal)
(corporate seal affixed)
Date: October 12, 2016

2

EX-31.1

Exhibit 31.1

CERTIFICATION PURSUANT TO
SECTION 302(a) OF THE SARBANES-OXLEY ACT OF 2002

I, Xin Sun, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q (this “Report”) of China Health Industries Holdings, Inc.;

2. Based on my knowledge, this 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(s) 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 over financial reporting 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 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(s) 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 registrant's board of directors (or persons performing the equivalent function):

(a) all significant deficiencies and material weaknesses in the design or operation of internal controls 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: November 14, 2016

/s/ Xin Sun

Xin Sun

Chief Executive Officer

(principal executive officer)

EX-31.2

Exhibit 31.2

CERTIFICATION PURSUANT TO
SECTION 302(a) OF THE SARBANES-OXLEY ACT OF 2002

I, Xin Sun, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q (this “Report”) of China Health Industries Holdings, Inc.;

2. Based on my knowledge, this 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(s) 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 over financial reporting 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 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(s) 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 registrant's board of directors (or persons performing the equivalent function):

(a) all significant deficiencies and material weaknesses in the design or operation of internal controls 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: November 14, 2016

/s/ Xin Sun

Xin Sun

Chief Financial Officer

(principal financial officer and principal accounting officer)

EX-32.1

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

The undersigned hereby certifies, in his capacity as Chief Executive Officer and Chief Financial Officer of China Health Industries Holdings, Inc. a Delaware corporation (the “Company”), for the purposes of 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of his knowledge:

1. The Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2016 as filed with the Securities and Exchange Commission (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 results of operations of the Company.

Date: November 14, 2016

/s/ Xin Sun

Xin Sun

Chief Executive Officer and Chief Financial Officer

(principal executive officer, principal financial officer and

principal accounting officer)

This certification accompanies each Report pursuant to §906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by the Sarbanes-Oxley Act of 2002, be deemed filed by the Company for purposes of §18 of the Securities Exchange Act of 1934, as amended.

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Document and Entity Information - shares	3 Months Ended
	Sep. 30, 2016	Nov. 04, 2016
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2016
Trading Symbol	chhe
Entity Registrant Name	China Health Industries Holdings, Inc.
Entity Central Index Key	0001309057
Current Fiscal Year End Date	--06-30
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		65,839,737
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well Known Seasoned Issuer	No
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	Q1

XML

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)	Sep. 30, 2016	Jun. 30, 2016
Current assets
Cash and cash equivalents	$ 20,778,742	$ 29,783,152
Short term investment	8,997,526	0
Interest receivable	224,938	0
Accounts receivable, net	962,055	1,145,131
Inventory	452,029	414,784
Other receivables, net	35,472	35,484
Advance to suppliers	153,816	154,430
Current assets held for discontinued operation	14,291	14,339
Total current assets	31,618,869	31,547,320
Property, plant and equipment, net	3,772,529	3,866,765
Intangible assets, net	4,065,541	4,191,059
Construction in progress	676,307	670,051
Other assets held for discontinued operation	3,589	3,602
Total assets	40,136,835	40,278,797
Current liabilities
Short-term loans	1,499,588	1,504,687
Accounts payable and accrued expenses	465,996	487,172
Other payables	32,563	37,036
Advance from customers	190,025	164,122
Related party debts	2,790,852	2,713,406
Wages payable	198,528	173,004
Taxes payable	322,904	467,674
Current liabilities held for discontinued operation	480,384	482,013
Total current liabilities	5,980,840	6,029,114
Equity
Common stock, ($0.0001 par value, 300,000,000 shares authorized, 65,839,737 and 65,839,737 issued and outstanding as of September 30, 2016 and June 30, 2016, respectively)	6,554	6,554
Additional paid-in capital	521,987	521,987
Accumulated other comprehensive income	666,335	784,045
Statutory reserve	38,679	38,679
Retained earnings	32,922,267	32,898,244
Total stockholders' equity	34,155,822	34,249,509
Non-controlling interests	173	174
Total equity	34,155,995	34,249,683
Total liabilities and equity	$ 40,136,835	$ 40,278,797

XML

CONDENSED CONSOLIDATED BALANCE SHEETS [Parenthetical] - $ / shares	Sep. 30, 2016	Jun. 30, 2016
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized	300,000,000	300,000,000
Common stock, shares issued	65,839,737	65,839,737
Common stock, shares outstanding	65,839,737	65,839,737

XML

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) - USD ($)	3 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
REVENUE	$ 1,180,168	$ 1,956,068
COST OF GOODS SOLD	755,285	1,418,964
GROSS PROFIT	424,883	537,104
OPERATING EXPENSES
Selling, general and administrative expenses	430,264	348,879
Depreciation and amortization expenses	148,875	181,961
Total operating expenses	579,139	530,840
INCOME (LOSS) FROM OPERATIONS	(154,256)	6,264
OTHER INCOME/(EXPENSES)
Interest income	19,909	18,107
Interest expense	(21,686)	(31,624)
Investment income	225,093	0
Other income, net	8,993	9,519
Total other income (expenses), net	232,309	(3,998)
INCOME BEFORE INCOME TAXES	78,053	2,266
Provision for income taxes	54,030	32,406
NET INCOME (LOSS) FROM CONTINUING OPERATIONS	24,023	(30,140)
Net loss from discontinued operations	0	(196)
NET INCOME (LOSS)	24,023	(30,336)
Less: net loss attributable to non-controlling interests	0	(2)
NET INCOME (LOSS) ATTRIBUTABLE TO CHINA HEALTH INDUSTRIES HOLDINGS	24,023	(30,334)
NET INCOME (LOSS) FROM CONTINUING OPERATIONS	24,023	(30,140)
NET LOSS FROM DISCONTINUED OPERATIONS	0	(196)
OTHER COMPREHENSIVE LOSS
Foreign currency translation loss	(117,711)	(899,478)
COMPREHENSIVE LOSS	(93,688)	(929,814)
Less: comprehensive loss attributable to non-controlling interests	(1)	(7)
COMPREHENSIVE LOSS ATTRIBUTABLE TO CHINA HEALTH INDUSTRIES HOLDINGS	$ (93,687)	$ (929,807)
Net income (loss) attributable to China Health Industries Holdings' shareholders per share are:
Basic & diluted income (loss) per share	$ 0.0004	$ (0.0005)
Weighted average shares outstanding:
Basic & diluted weighted average shares outstanding	65,616,175	65,539,737

XML

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	3 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
Cash Flows from Operating Activities
Net income (loss) available to China Health Industries Holdings	$ 24,023	$ (30,334)
Net loss from discontinued operations	0	(196)
Net income (loss) from continuing operations	24,023	(30,138)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization expenses	192,577	233,185
Provision for doubtful accounts	(1,243)	2,765
Non-controlling interests	0	(2)
Short term investment income	(225,093)	0
Changes in operating assets and liabilities
Accounts receivable	178,748	48,951
Other receivables	(111)	(856)
Inventory	(38,678)	(41,387)
Advance to suppliers and prepaid expenses	90	(22,577)
Accounts payables and accrued expenses	(19,544)	61,205
Advance from customers and other payables	22,130	10,974
Wages payable	26,128	(85,462)
Taxes payable	(143,283)	33,632
Net cash provided by operating activities from continuing operations	15,744	210,290
Net cash provided by operating activities from discontinued operations	0	0
Net cash provided by operating activities	15,744	210,290
Cash Flows from Investing Activities
Expenditure in short term investment	(9,003,737)	0
Notes receivable	0	571
Purchases of property, plant and equipment	0	(454)
Expenditure in construction in progress	(6,718)	(28,299)
Net cash used in investing activities from continuing operations	(9,010,455)	(28,182)
Net cash used in investing activities from discontinued operations	0	0
Net cash used in investing activities	(9,010,455)	(28,182)
Cash Flows from Financing Activities
Proceeds from related party debts	85,085	49,181
Net cash provided by financing activities from continuing operations	85,085	49,181
Net cash provided by financing activities from discontinued operations	0	0
Net cash provided by financing activities	85,085	49,181
Effect of exchange rate changes on cash and cash equivalents from continuing operations	(94,784)	(518,767)
Effect of exchange rate changes on cash and cash equivalents from discontinued operations	(29)	(226)
Net decrease in cash and cash equivalents from continuing operations	(9,004,410)	(287,478)
Net decrease in cash and cash equivalents from discontinued operations	(29)	(226)
Cash and cash equivalents, beginning balance from continuing operations	29,783,152	21,113,832
Cash and cash equivalents, beginning balance from discontinued operations	8,578	9,195
Cash and cash equivalents, ending balance from continuing operations	20,778,742	20,826,354
Cash and cash equivalents, ending balance from discontinued operations	8,549	8,969
Supplemental cash flow information
Cash paid for income taxes	201,142	336,058
Cash paid for interest expense	21,686	31,624
Non-cash activities:
Loan from related party for the construction of a facility	$ 457,690	$ 483,876

XML

ORGANIZATION AND BUSINESS BACKGROUND

3 Months Ended

Sep. 30, 2016

ORGANIZATION AND BUSINESS BACKGROUND [Text Block]

Note 1 - ORGANIZATION AND BUSINESS BACKGROUND

China Health Industries Holdings, Inc. (“China Health US”) was incorporated in the State of Arizona on July 11, 1996 and was the successor of the business known as Arizona Mist, Inc. which began in 1989. On May 9, 2005, it entered into a Stock Purchase Agreement and Share Exchange (effecting a reverse merger) with Edmonds 6, Inc. (“Edmonds 6”), a Delaware corporation, and changed its name to Universal Fog, Inc. Pursuant to this agreement, Universal Fog, Inc. (which has been in continuous operation since 1996) became a wholly-owned subsidiary of Edmonds 6.

China Health Industries Holdings Limited (“China Health HK”) was incorporated on July 20, 2007 in Hong Kong under the Companies Ordinance as a limited liability company. China Health HK was formed for the purpose of seeking and consummating a merger or acquisition with a business entity organized as a private corporation, partnership, or sole proprietorship as defined by Financial Accounting Standards Board (“FASB”) ACS Topic 915 (“Development Stage Entities”).

Harbin Humankind Biology Technology Co., Limited (“Humankind”) was incorporated in Harbin City, Heilongjiang Province, the People’s Republic of China (the “PRC”) on December 14, 2003, as a limited liability company under the Company Law of the PRC. Humankind is engaged in the manufacturing and sale of health products.

On August 20, 2007, the sole shareholder of China Health HK entered into a share purchase agreement (the “Share Purchase Agreement”) with the owners of Humankind. Pursuant to the Share Purchase Agreement, China Health HK purchased 100% of the ownership in Humankind for a cash consideration of $60,408 (the “Share Purchase”). Subsequent to the completion of the Share Purchase, Humankind became a wholly-owned subsidiary of China Health HK. The Share Purchase was accounted for as a “reverse merger” since the owner of Humankind owned a majority of the outstanding shares of China Health HK’s common stock immediately following the execution of the Share Purchase Agreement, it was deemed to be the acquirer in the reverse merger. Consequently, the assets and liabilities and the historical operations that have been reflected in the financial statements for periods prior to the Share Purchase are those of Humankind and have been recorded at the historical cost basis. After completion of the Share Purchase, China Health HK’s consolidated financial statements include the assets and liabilities of both China Health HK and Humankind, the historical operations of Humankind, and the operations of China Health HK and its subsidiaries from the closing date of the Share Purchase.

On October 14, 2008, Humankind set up a 99% owned subsidiary, Harbin Huimeijia Medicine Company (“Huimeijia”), with its primary business being manufacturing and distributing medicine. Mr. Xin Sun, the Company’s majority owner, owns 1% of Huimeijia. Huimeijia is consolidated in the consolidated financial statements of China Health HK.

On December 31, 2008, China Health HK entered into a reverse merger with Universal Fog, Inc., a U.S. publicly traded shell company (the “Transaction”). China Health HK is the acquirer in the Transaction, and the Transaction has been treated as a recapitalization of China Health US. After the Transaction and a 20:1 reverse stock split, Mr. Xin Sun owned 61,203,088 shares of common stock, representing 98.3% of the 62,234,737 total outstanding shares of common stock of China Health US. On April 7, 2009, Mr. Sun transferred 28,200,000 shares of common stock to 296 individuals, leaving him with 33,003,088 shares of common stock of China Health US, or approximately 53.03% of the total outstanding shares of common stock. Universal Fog, Inc. changed its name to China Health Industries Holdings, Inc. on February 19, 2009.

On November 22, 2013, Humankind completed the acquisition of Heilongjiang Huimeijia Pharmaceutical Co., Ltd. (“HLJ Huimeijia”) for a total purchase price of $16,339,869 (RMB100,000,000). HLJ Huimeijia was founded on October 30, 2003, and is engaged in the manufacturing and distribution of tincture, ointments, rubber paste (including hormones), topical solution, suppositories, liniment (including traditional Chinese medicine extractions), enemas and oral liquids. HLJ Huimeijia’s predecessor is Heilongjiang Xue Du Pharmaceutical Co., Ltd., which has established its brand name in the market through its supply of high quality medical products. HLJ Huimeijia is categorized as a “high and new technology” enterprise by the Science Technology Department in Heilongjiang Province. HLJ Huimeijia has 21 products which have been approved by, and have received approval numbers issued by, the China State Food and Drug Administration (the “CFDA”). In addition, HLJ Huimeijia is the holder of one patent for utility models, five patents for external design and three trademarks in China, including the Chinese brand name of “Xue Du” which has an established reputation among customers in northeastern China.

On December 24, 2014, Humankind entered into a Stock Transfer Agreement (the “Original Agreement”) with Xiuzheng Pharmaceutical Group Co., Ltd. a company incorporated under the laws of the People’s Republic of China and located in Jilin province (“Xiuzheng Pharmacy” or the “Buyer”), Mr. Xin Sun, the CEO of the Company, and Huimeijia, a 99% owned subsidiary of Humankind and 1% owned by Mr. Xin Sun, pursuant to which, Humankind and Mr. Xin Sun (the “Equity Holders”), shall sell their respective equity interests in Huimeijia, to Xiuzheng Pharmacy. On February 9, 2015, the four parties entered into a supplementary agreement (the “Supplementary Agreement”) to modify the terms of the Original Agreement, pursuant to which, the Equity Holders and Huimeijia (collectively the “Assets Transferors”) shall only sell the 19 drug approval numbers (the “Assets”) to Xiuzheng Pharmacy. The Equity Holders will retain the equity interests in Huimeijia, but will have the equity interests pledged to Xiuzheng Pharmacy until the Assets are transferred. On October 12, 2016, the four parties agreed to rescind the Supplementary Agreement and entered into a new supplementary agreement, pursuant to which, the four parties agreed to execute the transfer of the equity interests based on the Original Agreement, and according to which the Equity Holders shall sell their respective equity interests in Huimeijia to Xiuzheng Pharmacy for a total cash consideration of RMB8,000,000 (approximately $1,306,186, the “Purchase Price”) to the Equity Holders. As of the date of this report, 40% of the Purchase Price was paid and the Company has completed the changes in business registration and Xiuzheng Pharmacy obtained the newly issued document evidencing its ownership on Huimeijia, which is the business license issued by the local State Administration of Industry and Commerce in Harbin (“Harbin SAIC”) to Huimeijia where the ownership of Huimeijia has now been recorded as held by Xiuzheng Pharmacy with Harbin SAIC, and the legal representative (a person that is authorized to take most of the corporate actions on behalf of a company under the corporate laws in China) of Huimeijia has now become a person designated by the Buyer. The transfer of all the drugs to the Buyer and the remainder of the Purchase Price are pending to be processed (See Note 3). As of September 30, 2016, the results of operations of Huimeijia business are reflected in the Company’s unaudited condensed consolidated financial statements as discontinued operations.

China Health US, China Health HK, Humankind, Huimeijia and HLJ Huimeijia are collectively referred herein to as the “Company.”

As of September 30, 2016, the Company’s corporate structure was as follows:

[The Image has been Removed for XBRL purposes.  Please see HTML for Corporate Structure]

XML

SIGNIFICANT ACCOUNTING POLICIES

3 Months Ended

Sep. 30, 2016

SIGNIFICANT ACCOUNTING POLICIES [Text Block]

Note 2 - SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

This summary of significant accounting policies of the Company is presented to assist in understanding the Company’s financial statements. The financial statements and notes are representations of the Company’s management, which is responsible for their integrity and objectivity. These accounting policies conform to generally accepted accounting principles in the United States ("US GAAP") and have been consistently applied in the preparation of the unaudited condensed consolidated financial statements.

The accompanying unaudited condensed consolidated financial statements have been prepared by Company without audit pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). Certain information and disclosures normally included in financial statements prepared in accordance with US GAAP have been condensed or omitted as allowed by such rules and regulations, and management believes that the disclosures are adequate to make the information presented not misleading. These unaudited condensed consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended June 30, 2016. These unaudited condensed consolidated financial statements include all adjustments, which in the opinion of management are necessary to a fair presentation of financial position and results of operations. All such adjustments are of a normal and recurring nature. The results of operations for the three months ended September 30, 2016 may not be indicative of results that may be expected for the year ended June 30, 2017.

Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements include China Health US and its four subsidiary companies, including China Health HK, Humankind, Huimeijia, and HLJ Huimeijia. All significant intercompany balances and transactions have been eliminated in consolidation and combination.

On November 22, 2013, China Health US, through its wholly owned subsidiary Humankind, completed the acquisition of HLJ Huimeijia. HLJ Huimeijia and Humankind are under the common control of Mr. Xin Sun, the CEO of the Company before and after the date of transfer. Humankind’s accounting policy adopted the guidance in ASC 805-50-05-5 for the transfer of net assets between entities under common control to apply a method similar to the pooling-of-interests method. Under this method, the financial statements of Humankind shall report results of operations for the period in which the transfer occurs as though the transfer of net assets had occurred at the beginning of the period. Results of operations for that period will thus comprise both those of the previously separate entities combined from the beginning of the period to the date the transfer is completed and those of the combined operations from that date to the end of the period. Similarly, Humankind shall present the statements of financial position and other financial information as of the beginning of the period as though the assets and liabilities had been transferred at that date. Financial statements and financial information of Humankind presented for prior years also shall be retrospectively adjusted to furnish comparative information.

Reclassifications

Certain prior year balances were reclassified to conform to the current period's presentation with consideration of reflecting Huimeijia business as discontinued operations. None of these reclassifications had an impact on reported financial position or cash flows for any of the periods presented.

Segment Reporting

FASB ASC Topic 280, “Segment Reporting,” established standards for reporting information about operating segments on a basis consistent with the Company's internal organizational structure as well as information about geographical areas, business segments and major customers in financial statements for details on the Company's business segments. The Company has three reportable operating segments: Humankind, HLJ Huimeijia and others. The segments are grouped based on the types of products provided.

Fair Value of Financial Instruments

The provisions of accounting guidance, FASB ASC Topic 820 that applies to the Company requires all entities to disclose the fair value of financial instruments, both assets and liabilities recognized and not recognized on the balance sheets, for which it is practicable to estimate fair value, and defines fair value of a financial instrument as the amount at which the instrument could be exchanged in a current transaction between willing parties.

Fair Value Measurements

FASB ASC Topic 820, “Fair Value Measurements and Disclosures,” clarifies the definition of fair value for financial reporting, establishes a framework for measuring fair value and requires additional disclosures about the use of fair value measurements.

Various inputs are considered when determining the fair value of the Company’s debt. The inputs or methodologies used for valuing securities are not necessarily an indication of the risk associated with investing in these securities. These inputs are summarized in the three broad levels listed below.

Level 1 –observable market inputs that are unadjusted quoted prices for identical assets or liabilities in active markets.

Level 2 –other significant observable inputs (including quoted prices for similar securities, interest rates, credit risk, etc.).

Level 3 –significant unobservable inputs (including the Company’s own assumptions in determining the fair value of investments).

The carrying value of financial assets and liabilities recorded at fair value is measured on a recurring or nonrecurring basis. Financial assets and liabilities measured on a non-recurring basis are those that are adjusted to fair value when a significant event occurs. The Company had no financial assets or liabilities carried and measured on a nonrecurring basis during the reporting periods. Financial assets and liabilities measured on a recurring basis are those that are adjusted to fair value each time a financial statement is prepared. The Company had no financial assets or liabilities carried and measured on a recurring basis during the reporting periods.

The availability of inputs observable in the market varies from instrument to instrument and depends on a variety of factors including the type of instrument, whether the instrument is actively traded, and other characteristics particular to the transaction. For many financial instruments, pricing inputs are readily observable in the market, the valuation methodology used is widely accepted by market participants, and the valuation does not require significant management discretion. For other financial instruments, pricing inputs are less observable in the market and may require management judgment.

Translation of Foreign Currencies

Humankind, Huimeijia and HLJ Huimeijia maintain their books and accounting records in PRC currency “Renminbi” (“RMB”), which has been determined as the functional currency. Transactions denominated in currencies other than RMB are translated into RMB at the exchange rates prevailing on the date of the transactions, as quoted by the Federal Reserve Board. Foreign currency exchange gains and losses resulting from these transactions are included in operations.

Humankind, Huimeijia and HLJ Huimeijia’s financial statements are translated into the reporting currency, the United States Dollar (“USD”). Assets and liabilities of the above entities are translated at the prevailing exchange rate at each reporting period end date. Contributed capital accounts are translated using the historical rate of exchange when capital is injected. Income and expense accounts are translated at the average rate of exchange during the reporting period. Translation adjustments resulting from the translation of these financial statements are reflected as accumulated other comprehensive income in shareholders’ equity and non-controlling interests.

Statement of Cash Flows

In accordance with Statement FASB ASC Topic 230, “Statement of Cash Flows,” cash flow from the Company's operations is calculated based upon the local currencies and translated to the reporting currency using an average foreign exchange rate for the reporting period. As a result, amounts related to assets and liabilities reported in the statement of cash flows will not necessarily agree with changes in the corresponding balances on the balance sheet.

Use of Estimates and Assumptions

The preparation of financial statements in conformity with US GAAP requires management to make estimates and judgments that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities on the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company bases its estimates and judgments on historical experience and on various other assumptions and information that are believed to be reasonable under the circumstances. Estimates and assumptions of future events and their effects cannot be perceived with certainty and, accordingly, these estimates may change as new events occur, as more experience is acquired, as additional information is obtained and as the Company’s operating environment changes. Significant estimates and assumptions by management include, among others; useful lives of long-lived assets and intangible assets, valuation of inventory, accounts receivable and notes receivable, impairment analysis of long-lived assets, construction in progress, intangible assets and deferred taxes. While the Company believes that the estimates and assumptions used in the preparation of the financial statements are appropriate, actual results could differ from those estimates. Estimates and assumptions are periodically reviewed and the effects of revisions are reflected in the financial statements in the period they are determined to be necessary.

Cash and Cash Equivalents

Cash and cash equivalents include cash on hand, deposits in banks with maturities of three months or less, and all highly liquid investments which are unrestricted as to withdrawal or use, and which have original maturities of three months or less at the time of purchase.

As of September 30, 2016 and June 30, 2016, the Company’s uninsured bank balance was mainly maintained at financial institutions located in the PRC and HK. The uninsured bank balances of continuing operations were $20,778,742 and $29,783,152 as of September 30, 2016 and June 30, 2016, respectively. The uninsured bank balances of discontinued operations were $8,549 and $8,578 as of September 30, 2016 and June 30, 2016, respectively. The Company has no insured bank balance as of September 30, 2016 and June 30, 2016, respectively.

Accounts Receivable

Accounts receivable are recorded at the invoiced amount and do not bear interest. The Company extends unsecured credit to its customers in the ordinary course of business but mitigates the associated risks by performing credit checks and actively pursuing past due accounts. An allowance for doubtful accounts is established and determined based on management’s assessment of known requirements, aging of receivables, payment and bad debt history, the customer’s current credit worthiness, changes in customer payment patterns and the economic environment. From November 1, 2013, the Company changed its credit policy by offering ninety (90) day payment terms for sales agents, whereas the payment terms for sales agents before November 1, 2013 were thirty (30) day. As of September 30, 2016 and June 30, 2016, the balances of accounts receivable from the continuing operations, were $962,055 and $1,145,131, respectively. As of September 30, 2016 and June 30, 2016, the balances of accounts receivable from discontinued operations, were both nil. The Company determines the allowance based on aging data, historical collection experience, customer specific facts and economic conditions. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company evaluated the nature of all accounts receivable then provided allowance for doubtful accounts. The Company has determined that an allowance of $50,710 and $52,129 from the continuing operations was appropriate as of September 30, 2016 and June 30, 2016, respectively. The Company has determined that an allowance of nil from discontinued operations was appropriate as of September 30, 2016 and June 30, 2016.

Advance to Suppliers

The Company periodically makes advances to certain vendors for purchases of raw materials, or service providers for services relating to construction plans for its plant, equipment and production lines for the GMP upgrading, and records these payments as advance to suppliers. As of September 30, 2016 and June 30, 2016, advance to suppliers, held for continuing operations, amounted to $153,816 and $154,430, respectively. As of September 30, 2016 and June 30, 2016, advance to suppliers, held for discontinued operations, amounted to $556 and $558, respectively.

Inventory

Inventory consists of raw materials, work in progress and finished goods of manufactured products.

Inventory is stated at lower of cost or market and consists of materials, labor and overhead. HLJ Huimeijia uses the weighted average method for inventory valuation. The other entities of the Company use the first-in, first-out (“FIFO”) method for inventory valuation. Overhead costs included in finished goods include direct labor cost and other costs directly applicable to the manufacturing process. The Company evaluates inventory for excess, slow moving, and obsolete inventory as well as inventory the value of which is in excess of its net realizable value. This evaluation includes analysis of sales levels by product and projections of future demand. If future demand or market conditions are less favorable than the Company’s projections, a write-down of inventory may be required, and would be reflected in cost of goods sold in the period the revision is made. There was no inventory allowance, held for continuing operations and discontinued operations, provided for the three months ended September 30, 2016 and 2015, respectively.

Impairment of Long-Lived Assets

The Company’s long-lived assets and other assets are reviewed for impairment in accordance with the guidance of the FASB ASC Topic 360-10, “Property, Plant, and Equipment,” and FASB ASC Topic 205, “Presentation of Financial Statements.” The Company tests for impairment losses on long-lived assets used in operations whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. Recoverability of an asset to be held and used is measured by a comparison of the carrying amount of the asset to the future undiscounted cash flows expected to be generated by the asset. If such asset is considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the asset exceeds its fair value. Impairment evaluations involve management’s estimates on asset useful lives and future cash flows. Actual useful lives and cash flows could be different from those estimated by management which could have a material effect on the Company’s reporting results and financial position. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. As of September 30, 2016 and June 30, 2016, the Company had not experienced impairment losses on its long-lived assets for both the continuing and discontinued operations. However, there can be no assurances that demand for the Company’s products or services will continue, which could result in an impairment of long-lived assets in the future.

Property, Plant and Equipment

Property, plant and equipment are carried at the lower of cost or fair value. Maintenance, repairs and minor renewals are expensed as incurred, major renewals and improvements that extend the lives or increase the capacity of plant assets are capitalized.

When assets are retired or disposed of, the cost and accumulated depreciation are removed from the accounts, and any resulting gains or losses are included in the results of operations in the reporting period of disposition.

Depreciation is calculated on a straight-line basis over the estimated useful life of the assets. The depreciable lives applied are:

Building, Warehouse and Improvements	20 to 30 years
Office Equipment	3 to 7 years
Vehicles	5 to 15 years
Machinery and Equipment	7 to 15 years

Intangible Assets

The Company evaluates intangible assets in accordance with FASB ASC Topic 350, “Intangibles — Goodwill and Other.” Intangible assets deemed to have indefinite lives are not amortized, but are subject to annual impairment tests. If the assumptions and estimates used to allocate the purchase price are not correct, or if business conditions change, purchase price adjustments or future asset impairment charges could be required. The value of the Company’s intangible assets could be impacted by future adverse changes such as: (i) any future declines in the Company’s operating results, (ii) a decline in the valuation of technology, including the valuation of the Company’s common stock, (iii) a significant slowdown in the worldwide economy, or (iv) any failure to meet the performance projections included in the Company’s forecasts of future operating results. In accordance with FASB ASC Topic 350, the Company tests intangible assets for impairment on an annual basis or more frequently if the Company believes indicators of impairment exist. Impairment evaluations involve management estimates of asset useful lives and future cash flows. Significant management judgment is required in the forecasts of future operating results that are used in the evaluations. It is possible, however, that the plans and estimates used may be incorrect. If the Company’s actual results, or the plans and estimates used in future impairment analysis, are lower than the original estimates used to assess the recoverability of these assets, we could incur additional impairment charges in a future period. Based on such evaluations, there was no impairment recorded for intangible assets, held for both the continuing and discontinued operations, for the three months ended September 30, 2016 and 2015, respectively.

Construction in Progress

Construction in progress represents the costs incurred in connection with the construction of buildings or new additions to the Company’s plant facilities. Costs classified as construction in progress include all costs of obtaining the asset and bringing it to the location and condition necessary for its intended use. No depreciation is provided for construction in progress until such time as the assets are completed and are placed into service.

The Company reviews the carrying value of construction in progress for impairment whenever events and circumstances indicate that the carrying value of an asset may not be recoverable from the estimated future cash flows expected to result from its use and eventual disposition. In cases where undiscounted expected future cash flows are less than the carrying value of the assets, an impairment loss is recognized equal to an amount by which the carrying value exceeds the fair value of the assets. The factors considered by management in performing this assessment include current operating results, trends and prospects, the manner in which the property is used, and the effects of obsolescence, demand, competition and other economic factors. Based on this assessment, there was no impairment recorded for construction in progress, held for both the continuing and discontinued operations, for the three months ended September 30, 2016 and 2015, respectively.

Revenue Recognition

The Company recognizes revenue when it is both earned and realized or realizable. The Company’s policy is to recognize revenue when title to the product, ownership and risk of loss have transferred to the customer, persuasive evidence of an arrangement exits and collection of the sales proceeds is reasonably assured, all of which generally occur upon shipment of goods to customers. The majority of the Company’s revenue relates to the sale of inventory to customers, and revenue is recognized when title and the risks and rewards of ownership pass to the customer. Given the nature of the Company’s business and the applicable rules guiding revenue recognition, the Company’s revenue recognition practices do not contain estimates that materially affect the results of operations. The Company records revenue at the discounted selling price and allows its customers to return products for exchange or credit subject to certain limitations. A provision for such returns is recorded based upon historical experience. There has been no provision recorded for returns based upon historical experience, held for both the continuing and discontinued operations, for the three months ended September 30, 2016 and 2015, respectively.

Cost of Goods Sold

Cost of goods sold consists primarily of the costs of raw materials, freight charges, direct labor, depreciation of plants and machinery, warehousing and overhead costs associated with the manufacturing process and commission expenses.

Income Taxes

The Company adopts FASB ASC Topic 740, “Income Taxes,” which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized.

In July 2006, the FASB issued FIN 48(ASC 740-10), “Accounting for Uncertainty in Income Taxes — An Interpretation of FASB Statement No. 109 (ASC 740),” which requires income tax positions to meet a more-likely-than-not recognition threshold to be recognized in the financial statements. Under FIN 48(ASC 740-10), tax positions that previously failed to meet the more-likely-than-not threshold should be recognized in the first subsequent financial reporting period in which that threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not threshold should be derecognized in the first subsequent financial reporting period in which that threshold is no longer met.

As a result of the implementation of FIN 48 (ASC 740-10), the Company undertook a comprehensive review of its portfolio of tax positions in accordance with recognition standards established by FIN 48 (ASC 740-10). The Company recognized no material adjustments to liabilities or stockholders’ equity as a result of the implementation. The adoption of FIN 48 did not have a material impact on the Company’s financial statements.

The application of tax laws and regulations is subject to legal and factual interpretation, judgment and uncertainty. Tax laws and regulations themselves are subject to change as a result of changes in fiscal policy, changes in legislation, the evolution of regulations and court rulings. Therefore, the actual liability may be materially different from the Company’s estimates, which could result in the need to record additional tax liabilities or potentially reverse previously recorded tax liabilities or deferred tax asset valuation allowance.

Enterprise Income Tax

Under the Provisional Regulations of PRC Concerning Income Tax on Enterprises promulgated by the PRC (the “EIT Law”), income tax is payable by enterprises at a rate of 25% of their taxable income.

Value Added Tax

The Provisional Regulations of PRC Concerning Value Added Tax promulgated by the State Council came into effect on January 1, 1994. Under these regulations and the Implementing Rules of the Provisional Regulations of the PRC Concerning Value Added Tax, value added tax (“VAT”) is imposed on goods sold in, or imported into, the PRC and on processing, repair and replacement services provided within the PRC.

VAT payable in the PRC is charged on an aggregated basis at a rate of 13% or 17% (depending on the type of goods involved) on the full price collected for the goods sold or, in the case of taxable services provided, at a rate of 17% on the charges for the taxable services provided, but excluding, in respect of both goods and services, any amount paid in respect of VAT included in the price or charges, and less any deductible VAT already paid by the taxpayer on purchases of goods and services in the same financial year. As of September 30, 2016 and June 30, 2016 VAT payables from the continuing operations were $197,378 and $183,813, respectively. As of September 30, 2016 and June 30, 2016, VAT payables were both nil for the discontinued operations.

Sales-Related Taxes

Pursuant to the tax law and regulations of the PRC, the Company is obligated to pay 7% and 5% of the annual VAT paid as taxes on maintaining and building cities and education additional fees, both of which belong to sales-related taxes. Sales-related taxes are recorded when sales revenue is recognized. Sales-related taxes from the continuing operations were $22,637 and $33,901 for the three months ended September 30, 2016 and 2015, respectively. Sales-related taxes from the discontinued operations were both nil for the three months ended September 30, 2016 and 2015.

Concentrations of Business and Credit Risks

All of the Company’s manufacturing is located in the PRC. There can be no assurance that the Company will be able to successfully continue to manufacture its products and failure to do so would have a material adverse effect on the Company’s financial position, results of operations and cash flows. Also, the success of the Company’s operations is subject to numerous contingencies, some of which are beyond management’s control. These contingencies include general economic conditions, prices of raw materials, competition, governmental and political conditions, and changes in regulations. Since the Company is dependent on trade in the PRC, the Company is subject to various additional political, economic and other uncertainties. Among other risks, the Company’s operations will be subject to the risks of restrictions on transfer of funds, domestic customs, changing taxation policies, foreign exchange restrictions, and political and governmental regulations.

The Company operates in China, which may give rise to significant foreign currency risks from fluctuations and the degree of volatility of foreign exchange rates between U.S. dollars and the Chinese currency RMB. The results of operations denominated in foreign currency are translated at the average rate of exchange during the reporting periods.

Earnings Per Share

Basic earnings per common share is computed by dividing net earnings applicable to common shareholders by the weighted-average number of common shares outstanding during the period. When applicable, diluted earnings per common share is determined using the weighted-average number of common shares outstanding during the period, adjusted for the dilutive effect of common stock equivalents, consisting of shares that might be issued upon exercise of common stock options and warrants. For the three months ended September 30, 2016 and 2015, the Company had no potential dilutive common stock equivalents outstanding.

Potential common shares issued are calculated using the treasury stock method, which recognizes the use of proceeds that could be obtained upon the exercise of options and warrants in computing diluted earnings per share. It assumes that any proceeds would be used to purchase common stock at the average market price of the common stock during the period.

FASB ASC Topic 260, “Earnings Per Share,” requires a reconciliation of the numerator and denominator of the basic and diluted earnings per share (EPS) computations.

Recent Accounting Pronouncements

In August 2016, the FASB has issued Accounting Standards Update (“ASU”) No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments, to address diversity in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The amendments provide guidance on the following eight specific cash flow issues: (1) Debt Prepayment or Debt Extinguishment Costs; (2) Settlement of Zero-Coupon Debt Instruments or Other Debt Instruments with Coupon Interest Rates That Are Insignificant in Relation to the Effective Interest Rate of the Borrowing; (3) Contingent Consideration Payments Made after a Business Combination; (4)Proceeds from the Settlement of Insurance Claims; (5) Proceeds from the Settlement of Corporate-Owned Life Insurance Policies, including Bank-Owned; (6) Life Insurance Policies; (7) Distributions Received from Equity Method Investees; (8) Beneficial Interests in Securitization Transactions; and Separately Identifiable Cash Flows and Application of the Predominance Principle. The amendments are effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2019. Early adoption is permitted, including adoption in an interim period. The amendments should be applied using a retrospective transition method to each period presented. If it is impracticable to apply the amendments retrospectively for some of the issues, the amendments for those issues would be applied prospectively as of the earliest date practicable. The Company is currently evaluating the impact of this new standard on its consolidated financial statements and related disclosures.

In October 2016, the FASB has issued ASU No. 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory. The amendments require an entity to recognize income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs and remove the exception to postpone recognition until the asset has been sold to an outside party. The amendments are effective for public business entities for annual reporting periods beginning after December 15, 2017, including interim reporting periods within those annual reporting periods. For all other entities, the amendments are effective for annual reporting periods beginning after December 15, 2018, and interim reporting periods within annual reporting periods beginning after December 15, 2019. Early adoption is permitted. The Company is currently evaluating the impact of this new standard on its consolidated financial statements and related disclosures.

In October 2016, the FASB has issued ASU No. 2016-17, Consolidation (Topic 810): Interest Held through Related Parties That Are under Common Control, to provide guidance on the evaluation of whether a reporting entity is the primary beneficiary of a VIE by amending how a reporting entity, that is a single decision maker of a VIE, treats indirect interests in that entity held through related parties that are under common control. The amendments are effective for public business entities for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2016, and interim periods within fiscal years beginning after December 15, 2017. Early adoption is permitted, including adoption in an interim period. The Company is currently evaluating the impact of this new standard on its consolidated financial statements and related disclosures.

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ASSETS SALE

3 Months Ended

Sep. 30, 2016

ASSETS SALE [Text Block]

NOTE 3 - ASSETS SALE

On December 24, 2014, Humankind entered into a stock transfer agreement (the “Original Agreement”) with Xiuzheng Pharmaceutical Group Co., Ltd. a company incorporated under the laws of the People’s Republic of China and located in Jilin province (“Xiuzheng Pharmacy”or the “Buyer”), Mr. Xin Sun, the CEO of the Company, and Huimeijia, pursuant to which, Humankind and Mr. Xin Sun (the “Equity Holders”), shall sell their respective equity interests in Huimeijia to Xiuzheng Pharmacy. The transfer of the 100% equity interests of Huimeijia to the Buyer was for a total cash consideration of RMB8,000,000 (approximately $1,306,186) to the Equity Holders.

On February 9, 2015, the four parties entered into a supplementary agreement (the “Supplementary Agreement”) to modify the terms of the Original Agreement, pursuant to which, the Equity Holders and Huimeijia (collectively the “Assets Transferors”) shall only sell the 19 drug approval numbers (including the tablet, capsule, powder, mixture, oral liquid, syrup and oral solution under the 19 approval numbers; licenses including the original copies of Business License, Organization Code Certificate, Tax Registration Certificate, Drug Production Permit and GMP Certificate, and other documents and original copies related to the production and operation of the 19 drugs) (the “Assets”) to Xiuzheng Pharmacy. The Equity Holders will retain the equity interests in Huimeijia, but will have the equity interests pledged to Xiuzheng Pharmacy until the Assets are transferred, at which time all the cash consideration shall be paid by the Buyer. The total cash consideration remains to be the same as under the Original Agreement, i.e., RMB8,000,000 (approximately $1,306,186) to the Assets Transferors. In the event that the Assets are failed to be transferred to the Buyer due to the fault of the Assets Transferors, the paid consideration shall be returned to the Buyer with interests accrued. If the failure of the transfer of the Assets is a result of the government policy changes or force majeure, the paid cash consideration shall be returned to the Buyer but without any interests.

On October 12, 2016, the four parties agreed to rescind the Supplementary Agreement and entered into a new supplementary agreement (the “Agreement”), pursuant to which, the four parties agreed to execute the transfer of the equity interests based on the Original Agreement, and according to which the Equity Holders shall sell their respective equity interests in Huimeijia to Xiuzheng Pharmacy. The transfer of the 100% equity interests of Huimeijia to the Buyer was for a total cash consideration of RMB8,000,000 (approximately $1,306,186) (the “Purchase Price”) to the Equity Holders. 40% of the Purchase Price is due within 10 business days after signing the Agreement; 40% of the Purchase Price is due within 10 business days after the completion of the changes in business registration and Xiuzheng Pharmacy obtains the newly issued documents evidencing its ownership on Huimeijia; 15% of the Purchase Price is due within 10 business days after the transfer of all the drugs is approved by Heilongjiang FDA; and 5% of the Purchase Price is due within 10 business days after all the drugs have been transferred to Xiuzheng Pharmacy or its designated entity and Humankind and Mr. Xin Sun instructs Xiuzheng Pharmacy to complete three-batches production of all forms of drugs. As of the date of this report, 40% of the Purchase Price was paid and the Company has completed the changes in business registration and Xiuzheng Pharmacy obtained the newly issued documents evidencing its ownership on Huimeijia, which are evidenced by the business license issued by the local State Administration of Industry and Commerce in Harbin (“Harbin SAIC”) to Huimeijia where the ownership of Huimeijia has now been recorded as held by Xiuzheng Pharmacy with Harbin SAIC and the legal representative (a person that is authorized to take most of the corporate actions on behalf of a company under the corporate laws in China) of Huimeijia has now become a person designated by the Buyer. The transfer of all the drugs to the Buyer and the remainder of the Purchase Price are pending to be processed.

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ACCOUNTS RECEIVABLE

3 Months Ended

Sep. 30, 2016

ACCOUNTS RECEIVABLE [Text Block]

NOTE 4 - ACCOUNTS RECEIVABLE

The Company’s accounts receivable, held for continuing operations, were $962,055 and $1,145,131, respectively, net of allowance for doubtful accounts amounting to $50,710 and $52,129 as of September 30, 2016 and June 30, 2016, respectively. The Company’s accounts receivable, held for discontinued operations, were both nil, net of allowance for doubtful accounts amounting to nil as of September 30, 2016 and June 30, 2016, respectively.

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INVENTORY

3 Months Ended

Sep. 30, 2016

INVENTORY [Text Block]

NOTE 5 - INVENTORY

Inventory from the continuing operations consisted of following:

		September 30,		June 30,
		2016		2016
Raw Materials	$	132,272	$	122,569
Supplies and Packing Materials		135,742		130,472
Work-in-Progress		131,323		118,233
Finished Goods		57,878		48,713
Total		457,215		419,987
Less: Inventory, Held for Discontinued Operations		5,186		5,203
Inventory, Held for Continuing Operations	$	452,029	$	414,784

For the three months ended September 30, 2016 and 2015, the Company has not made provision for inventory from the continued and discontinued operations in regards to excessive, slow moving or obsolete items.

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CONSTRUCTION IN PROGRESS

3 Months Ended

Sep. 30, 2016

CONSTRUCTION IN PROGRESS [Text Block]

NOTE 6 - CONSTRUCTION IN PROGRESS

Construction in progress from the continuing operations consisted of the following:

		September 30,		June 30,
		2016		2016
Plant - HLJ Huimeijia	$	676,307	$	670,051
Plant and Production Lines - Huimeijia		1,800		1,806
Total		678,107		671,857
Less: Construction in Progress, Held for Discontinued Operations		1,800		1,806
Construction in Progress, Held for Continuing Operations	$	676,307	$	670,051

On April 6, 2012, HLJ Huimeijia entered into an agreement with a contractor for the plant, the estimated total cost of construction was approximately $2.09 million (RMB12,800,000), anticipated to be completed by December 2016. As of September 30, 2016, 35% of construction had been completed and $676,307 (RMB4,509,953) had been recorded as a cost of construction in progress.

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PROPERTY, PLANT AND EQUIPMENT

3 Months Ended

Sep. 30, 2016

PROPERTY, PLANT AND EQUIPMENT [Text Block]

NOTE 7 - PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment from the continuing operations consisted of the following:

		September 30,			June 30,
		2016			2016
Building, Warehouses and Improvements	$	4,345,412		$	4,360,191
Machinery and Equipment		1,228,683			1,232,861
Office Equipment		69,095			69,330
Vehicles		203,764			204,457
Less: Accumulated Depreciation		(2,072,636	)		(1,998,278	)
Total		3,774,318			3,868,561
Less: Property and Equipment, net, Held for Discontinued Operations		1,789			1,796
Property and Equipment, net, held for continuing operations	$	3,772,529		$	3,866,765

Depreciation expense from the continuing operations was $81,187 and $85,735 for the three months ended September 30, 2016 and 2015, respectively. Depreciation expense from the discontinued operations was nil and $196 for the three months ended September 30, 2016 and 2015, respectively. Depreciation expense charged to operations from the continuing operations was $37,485 and $34,511 for the three months ended September 30, 2016 and 2015, respectively. Depreciation expense charged to cost of goods sold from the continuing operations was $43,702 and $51,224 for the three months ended September 30, 2016 and 2015, respectively. Depreciation expense charged to operations from the discontinued operations was nil and $196 for the three months ended September 30, 2016 and 2015, respectively. Depreciation expense charged to cost of goods sold from the discontinued operations was both nil for the three months ended September 30, 2016 and 2015, respectively.

As of September 30, 2016, the building of HLJ Huimeijia with the book value of $1,670,945 has been mortgaged for the working capital loan in the principal amount of $1,499,588 (RMB10,000,000). As of June 30, 2016, the building of HLJ Huimeijia with the book value of $1,676,627 has been mortgaged for the working capital loan in the principal amount of $1,504,687 (RMB10,000,000).

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INTANGIBLE ASSETS

3 Months Ended

Sep. 30, 2016

INTANGIBLE ASSETS [Text Block]

NOTE 8 - INTANGIBLE ASSETS

The following is a summary of intangible assets from the continuing operations:

		September 30, 2016			June 30, 2016
Land Use Rights – Humankind	$	950,436		$	953,670
Health Supplement Product Patents – Humankind		4,498,763			4,514,061
Pharmaceutical Patents - HLJ Huimeijia		134,361			134,817
Land Use Rights - HLJ Huimeijia		650,084			652,295
Less: Accumulated Amortization		(2,168,103	)		(2,063,784	)
Total		4,065,541			4,191,059
Less: Intangible Assets, net, Held for Discontinued Operations		-			-
Intangible Assets, net, Held for Continuing Operations	$	4,065,541		$	4,191,059

All land in the PRC belongs to the State. Enterprises and individuals can pay the State a fee to obtain the right to use a piece of land for commercial purposes or residential purposes for an initial period of 50 years or 70 years, respectively. The land use right can be sold, purchased, and exchanged in the market. The successor owner of the land use right will have the right to use the land for the time remaining on the initial period.

Amortization expense from the continuing operations was $111,390 and $147,450 for the three months ended September 30, 2016 and 2015, respectively. Amortization expense from the discontinued operations was both nil for the three months ended September 30, 2016 and 2015.

As of September 30, 2016, land use rights of HLJ Huimeijia with the book value of $650,084 have been mortgaged for a working capital loan in the principal amount of $1,499,588 (RMB10,000,000). As of June 30, 2016, land use rights of HLJ Huimeijia with the book value of $652,295 have been mortgaged for a working capital loan in the principal amount of $1,504,687 (RMB10,000,000).

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SHORT-TERM LOAN

3 Months Ended

Sep. 30, 2016

SHORT-TERM LOAN [Text Block]

NOTE 9 - SHORT-TERM LOAN

On November 12, 2015, HLJ Huimeijia entered into a short-term loan agreement with a bank for a working capital loan in the principal amount of RMB10,000,000, at an interest rate of 5.66% from November 12, 2015 to November 10, 2016. The loan was secured by the land use right and the building of HLJ Huimeijia, with a maturity date of November 10, 2016. As of September 30, 2016 and June 30, 2016, the Company’s short-term loan from the continuing operations was $1,499,588 and $1,504,687, respectively. As of September 30, 2016 and June 30, 2016, the Company’s short-term loan from the discontinued operations was both nil.

Interest expenses from the continuing operations were $21,686 and $31,624 for the three months ended September 30, 2016 and 2015, respectively. Interest expenses from the discontinued operations were both nil for the three months ended September 30, 2016 and 2015, respectively.

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RELATED PARTY DEBTS

3 Months Ended

Sep. 30, 2016

RELATED PARTY DEBTS [Text Block]

NOTE 10 - RELATED PARTY DEBTS

Related party debts, which represent temporary short-term loans from Mr. Xin Sun and Mr. Kai Sun, consisted of the following:

		S eptember 30, 201 6		June 30, 2016
Mr. Xin Sun	$	2,755,786	$	2,678,220
Mr. Kai Sun		35,066		35,186
Total		2,790,852		2,713,406
Less: Related Party Debts, Held for Discontinued Operations		-		-
Related Party Debts, Held for Continuing Operations	$	2,790,852	$	2,713,406

These loans are unsecured and non-interest bearing and have no fixed terms of repayment; therefore, they are deemed payable on demand. Mr. Kai Sun is a PRC citizen and a family member of Mr. Xin Sun, the CEO of the Company.

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INCOME TAXES

3 Months Ended

Sep. 30, 2016

INCOME TAXES [Text Block]

NOTE 11 - INCOME TAXES

(a) Corporate income taxes

United States

China Health US was organized in the United States. China Health US had no taxable income for US income tax purposes for the three months ended September 30, 2016 and 2015, respectively. As of September 30, 2016, China Health US has a net operating loss carry forward for United States income taxes. Net operating loss carry forwards are available to reduce future years’ taxable income. Management believes that the realization of the benefits from these losses appears uncertain due to the Company’s operating history and the continued losses of the US entity. Accordingly, the Company has provided a 100% valuation allowance on the deferred tax asset to reduce the asset to zero. There were no changes in the valuation allowance for the three months ended September 30, 2016 and 2015. Management reviews this valuation allowance periodically and makes adjustments accordingly.

Hong Kong

China Health HK was incorporated in Hong Kong and is subject to Hong Kong taxation on its activities conducted in Hong Kong and income arising in or derived from Hong Kong. No provision for income taxes have been made as China Health HK has no taxable income in Hong Kong.

People’s Republic of China

Under the EIT Law, the standard EIT rate is 25%. The PRC subsidiaries of the Company are subject to PRC income taxes on an entity basis on income arising in or derived from the tax jurisdiction in which they operate.

The provision for income taxes from the continuing operations consisted of the following for the three months ended September 30, 2016 and 2015:

		For the Three Months Ended
		September 30,
		2016		2015
Current provision:
USA	$	-	$	-
China		54,030		32,406
Total current provision		54,030		32,406
Deferred provision:
USA		-		-
China		-		-
Total deferred provision		-		-
Total provision for income taxes		54,030		32,406
Less: Provision for income taxes, held for discontinued operations		-		-
Provision for income taxes, held for continuing operations	$	54,030	$	32,406

Significant components of deferred tax assets from the continuing operations were as follows:

		September 30,			June 30,
		2016			2016
Deferred tax assets
Net operating loss carry forward	$	112,236		$	118,259
Allowance for doubtful accounts		-			-
Valuation allowance		(112,236	)		(118,259	)
Deferred tax assets, net		-			-
Less: Deferred tax assets, net, held for discontinued operations		-			-
Deferred tax assets, net, held for continuing operations	$	-		$	-

As of September 30, 2016 and June 30, 2016, the Company accrued a 100% valuation allowance on its deferred tax assets based on the assessment on the probability of future reversion.

(b) Uncertain tax positions

There were no unrecognized tax benefits as of September 30, 2016 and June 30, 2016, respectively. Management does not anticipate any potential future adjustments in the next twelve months which would result in a material change to its tax positions. For the three months ended September 30, 2016 and 2015, the Company did not incur any interest and penalties arising from its tax payments.

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COMMITMENTS AND CONTINGENCIES

3 Months Ended

Sep. 30, 2016

COMMITMENTS AND CONTINGENCIES [Text Block]

NOTE 12 - COMMITMENTS AND CONTINGENCIES

The Company’s assets are located in the PRC and revenues are derived from operations in the PRC.

In terms of industry regulations and policies, the economy of the PRC has been transitioning from a planned economy to market oriented economy. Although in recent years the Chinese government has implemented measures emphasizing the utilization of market forces for economic reforms, the reduction of state ownership of productive assets and the establishment of sound corporate governance in business enterprises, a substantial portion of productive assets in the PRC is still owned by the Chinese government. For example, all land is state owned and leased to business entities or individuals through the government’s granting of Land Use Rights. The granting process is typically based on government policies at the time of granting and can be lengthy and complex. This process may adversely affect the Company’s future manufacturing expansions. The Chinese government also exercises significant control over the PRC’s economic growth through the allocation of resources and providing preferential treatment to particular industries or companies. Uncertainties may arise with changing of governmental policies and measures.

The Company faces a number of risks and challenges not typically associated with companies in North America or Western Europe, since its assets exist solely in the PRC, and its revenues are derived from its operations therein. The PRC is a developing country with an early stage market economic system, overshadowed by the state. Its political and economic systems are very different from the more developed countries and are in a state of change. The PRC also faces many social, economic and political challenges that may produce major shocks, instabilities and even crises, in both its domestic arena and in its relationships with other countries, including the United States. Such shocks, instabilities and crises may in turn significantly and negatively affect the Company’s performance.

Since the Company terminated its rental agreement on January 9, 2013, it had no rental commitment as of September 30, 2016.

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MAJOR SUPPLIERS AND CUSTOMERS

3 Months Ended

Sep. 30, 2016

MAJOR SUPPLIERS AND CUSTOMERS [Text Block]

NOTE 13 - MAJOR SUPPLIERS AND CUSTOMERS

For the three months ended September 30, 2016, the Company had two suppliers that in the aggregate accounted for 88% of the Company’s purchases for the continuing operations, with each supplier accounting for 78% and 10%, respectively.

For the three months ended September 30, 2015, the Company had one supplier that in the aggregate accounted for 75% of the Company’s purchases for the continuing operations.

For the three months ended September 30, 2016, the Company had six customers that in the aggregate accounted for 81% of the Company’s total sales for the continuing operations, with each customer accounting for 16%, 15%, 13%, 13%, 12% and 12%, respectively.

For the three months ended September 30, 2015, the Company had four customers that in the aggregate accounted for 42% of the Company’s total sales for the continuing operations, with each customer accounting for 11%, 11%, 10% and 10%, respectively.

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SEGMENT REPORTING

3 Months Ended

Sep. 30, 2016

SEGMENT REPORTING [Text Block]

NOTE 14 - SEGMENT REPORTING

The Company was organized into three main business segments based on the types of products being provided to customers: HLJ Huimeijia, Humankind and others. Each of the three operating segments referenced above has separate and distinct general ledgers. The chief operating decision maker (“CODM”) receives financial information, including revenue, gross margin, operating income, and net income produced from the various general ledger systems to make decisions about allocating resources and assessing performance; however, the principal measure of segment profitability or loss used by the CODM is net loss by segment. The discontinued Huimeijia business was included in others segment.

The following tables present summary information by segment for the three months ended September 30, 2016 and 2015, respectively:

		For the Three Months Ended September 30, 2016										For the Three Months Ended September 30, 2015
										Consolidated										Consolidated
										from										from
		HLJ								continuing		HLJ								continuing
		Huimeijia			Humankind		Others			operations		Huimeijia			Humankind		Others			operations
Revenues	$	100		$	1,180,068	$	-		$	1,180,168	$	293,756		$	1,662,312	$	-		$	1,956,068
Cost of revenues		58			755,227		-			755,285		250,346			1,168,618		-			1,418,964
Gross profit		42			424,841		-			424,883		43,410			493,694		-			537,104
Interest expense		21,686			-		-			21,686		31,624			-		-			31,624
Depreciation and amortization		14,230			134,645		-			148,875		18,792			163,169		-			181,961
Income tax		-			54,030		-			54,030		-			32,406		-			32,406
Net income (loss)		(137,873	)		162,091		(195	)		24,023		(127,282	)		97,216		(74	)		(30,140	)
Total capital expenditures		-			-		-			-		-			454		-			454
Total assets	$	2,922,517		$	37,194,994	$	1,444		$	40,118,955	$	3,282,095		$	37,246,334	$	2,024		$	40,530,453

		For the Three Months Ended				For the Three Months Ended
		September 30, 2016				September 30, 2015
				Consolidated from					Consolidated from
				discontinued					discontinued
		Huimeijia		operations		Huimeijia			operations
Revenues	$	-	$	-	$	-		$	-
Cost of revenues		-		-		-			-
Gross profit		-		-		-			-
Interest expense		-		-		-			-
Depreciation and amortization		-		-		196			196
Income tax		-		-		-			-
Net loss		-		-		(196	)		(196	)
Total capital expenditures		-		-		-			-
Total assets	$	17,880	$	17,880	$	19,341		$	19,341

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DISCONTINUED OPERATIONS

3 Months Ended

Sep. 30, 2016

DISCONTINUED OPERATIONS [Text Block]

NOTE 15 - DISCONTINUED OPERATIONS

In accordance with ASU No. 2014-08, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity, a disposal of a component of an entity or a group of components of an entity is required to be reported as discontinued operations if the disposal represents a strategic shift that has (or will have) a major effect on an entity’s operations and financial results when the components of an entity meets the criteria in paragraph 205-20-45-1E to be classified as held for sale. When all of the criteria to be classified as held for sale are met, including management, having the authority to approve the action, commits to a plan to sell the entity, the major current assets, other assets, current liabilities, and noncurrent liabilities shall be reported as components of total assets and liabilities separate from those balances of the continuing operations. At the same time, the results of all discontinued operations, less applicable income taxes (benefit), shall be reported as a component of net income (loss) separate from the net income (loss) of continued operations in accordance with ASC 205-20-45.

Reconciliation of the carrying amounts of major classes of assets and liabilities of discontinued operations classified as discontinued operations in the unaudited condensed consolidated balance sheets.

		September 30, 2016			June 30, 2016
ASSETS
Current Assets
Cash and cash equivalents	$	8,549		$	8,578
Inventory		5,186			5,203
Advance to suppliers		556			558
Total Current Assets		14,291			14,339
Property, plant and equipment, net		1,789			1,796
Construction in progress		1,800			1,806
Total Assets	$	17,880		$	17,941
LIABILITIES AND EQUITY
Current Liabilities:	$			$
Accounts payable and accrued expenses		556			558
Other payables		20			16
Advance from customers		479,868			481,500
Taxes payable		(60	)		(61	)
Total Current Liabilities		480,384			482,013
Total Liabilities	$	480,384		$	482,013

Reconciliation of the carrying amounts of major classes of net income (loss) from operations to be disposed classified as discontinued operations in the unaudited condensed consolidated statements of operations and comprehensive income (loss).

		For the Three Months Ended
		September 30,
		2016		2015
Operating Expenses
Depreciation and amortization expenses	$	-	$	(196	)
Total Operating Expenses		-		(196	)
Loss from Operations		-		(196	)
Loss before Income Taxes		-		(196	)
Net Loss from Discontinued Operations	$	-	$	(196	)

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SUBSEQUENT EVENTS

3 Months Ended

Sep. 30, 2016

SUBSEQUENT EVENTS [Text Block]

NOTE 16 - SUBSEQUENT EVENTS

On October 12, 2016, Humankind, Xiuzheng Pharmacy, Mr. Xin Sun and Huimeijia agreed to rescind the Supplementary Agreement which was entered into on February 9, 2015. Meanwhile, the four parties entered into a new supplementary agreement, pursuant to which, Humankind and Mr. Xin Sun shall sell their respective equity interests in Huimeijia to Xiuzheng Pharmacy. Please refer to “NOTE 3 – ASSETS SALE”.

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Summary of Significant Accounting Policies (Policies)

3 Months Ended

Sep. 30, 2016

Basis of Presentation [Policy Text Block]

Basis of Presentation

This summary of significant accounting policies of the Company is presented to assist in understanding the Company’s financial statements. The financial statements and notes are representations of the Company’s management, which is responsible for their integrity and objectivity. These accounting policies conform to generally accepted accounting principles in the United States ("US GAAP") and have been consistently applied in the preparation of the unaudited condensed consolidated financial statements.

The accompanying unaudited condensed consolidated financial statements have been prepared by Company without audit pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). Certain information and disclosures normally included in financial statements prepared in accordance with US GAAP have been condensed or omitted as allowed by such rules and regulations, and management believes that the disclosures are adequate to make the information presented not misleading. These unaudited condensed consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended June 30, 2016. These unaudited condensed consolidated financial statements include all adjustments, which in the opinion of management are necessary to a fair presentation of financial position and results of operations. All such adjustments are of a normal and recurring nature. The results of operations for the three months ended September 30, 2016 may not be indicative of results that may be expected for the year ended June 30, 2017.

Principles of Consolidation [Policy Text Block]

Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements include China Health US and its four subsidiary companies, including China Health HK, Humankind, Huimeijia, and HLJ Huimeijia. All significant intercompany balances and transactions have been eliminated in consolidation and combination.

On November 22, 2013, China Health US, through its wholly owned subsidiary Humankind, completed the acquisition of HLJ Huimeijia. HLJ Huimeijia and Humankind are under the common control of Mr. Xin Sun, the CEO of the Company before and after the date of transfer. Humankind’s accounting policy adopted the guidance in ASC 805-50-05-5 for the transfer of net assets between entities under common control to apply a method similar to the pooling-of-interests method. Under this method, the financial statements of Humankind shall report results of operations for the period in which the transfer occurs as though the transfer of net assets had occurred at the beginning of the period. Results of operations for that period will thus comprise both those of the previously separate entities combined from the beginning of the period to the date the transfer is completed and those of the combined operations from that date to the end of the period. Similarly, Humankind shall present the statements of financial position and other financial information as of the beginning of the period as though the assets and liabilities had been transferred at that date. Financial statements and financial information of Humankind presented for prior years also shall be retrospectively adjusted to furnish comparative information.

Reclassifications [Policy Text Block]

Reclassifications

Certain prior year balances were reclassified to conform to the current period's presentation with consideration of reflecting Huimeijia business as discontinued operations. None of these reclassifications had an impact on reported financial position or cash flows for any of the periods presented.

Segment Reporting [Policy Text Block]

Segment Reporting

FASB ASC Topic 280, “Segment Reporting,” established standards for reporting information about operating segments on a basis consistent with the Company's internal organizational structure as well as information about geographical areas, business segments and major customers in financial statements for details on the Company's business segments. The Company has three reportable operating segments: Humankind, HLJ Huimeijia and others. The segments are grouped based on the types of products provided.

Fair Value of Financial Instruments [Policy Text Block]

Fair Value of Financial Instruments

The provisions of accounting guidance, FASB ASC Topic 820 that applies to the Company requires all entities to disclose the fair value of financial instruments, both assets and liabilities recognized and not recognized on the balance sheets, for which it is practicable to estimate fair value, and defines fair value of a financial instrument as the amount at which the instrument could be exchanged in a current transaction between willing parties.

Fair Value Measurements [Policy Text Block]

Fair Value Measurements

FASB ASC Topic 820, “Fair Value Measurements and Disclosures,” clarifies the definition of fair value for financial reporting, establishes a framework for measuring fair value and requires additional disclosures about the use of fair value measurements.

Various inputs are considered when determining the fair value of the Company’s debt. The inputs or methodologies used for valuing securities are not necessarily an indication of the risk associated with investing in these securities. These inputs are summarized in the three broad levels listed below.

Level 1 –observable market inputs that are unadjusted quoted prices for identical assets or liabilities in active markets.

Level 2 –other significant observable inputs (including quoted prices for similar securities, interest rates, credit risk, etc.).

Level 3 –significant unobservable inputs (including the Company’s own assumptions in determining the fair value of investments).

The carrying value of financial assets and liabilities recorded at fair value is measured on a recurring or nonrecurring basis. Financial assets and liabilities measured on a non-recurring basis are those that are adjusted to fair value when a significant event occurs. The Company had no financial assets or liabilities carried and measured on a nonrecurring basis during the reporting periods. Financial assets and liabilities measured on a recurring basis are those that are adjusted to fair value each time a financial statement is prepared. The Company had no financial assets or liabilities carried and measured on a recurring basis during the reporting periods.

The availability of inputs observable in the market varies from instrument to instrument and depends on a variety of factors including the type of instrument, whether the instrument is actively traded, and other characteristics particular to the transaction. For many financial instruments, pricing inputs are readily observable in the market, the valuation methodology used is widely accepted by market participants, and the valuation does not require significant management discretion. For other financial instruments, pricing inputs are less observable in the market and may require management judgment.

Translation of Foreign Currencies [Policy Text Block]

Translation of Foreign Currencies

Humankind, Huimeijia and HLJ Huimeijia maintain their books and accounting records in PRC currency “Renminbi” (“RMB”), which has been determined as the functional currency. Transactions denominated in currencies other than RMB are translated into RMB at the exchange rates prevailing on the date of the transactions, as quoted by the Federal Reserve Board. Foreign currency exchange gains and losses resulting from these transactions are included in operations.

Humankind, Huimeijia and HLJ Huimeijia’s financial statements are translated into the reporting currency, the United States Dollar (“USD”). Assets and liabilities of the above entities are translated at the prevailing exchange rate at each reporting period end date. Contributed capital accounts are translated using the historical rate of exchange when capital is injected. Income and expense accounts are translated at the average rate of exchange during the reporting period. Translation adjustments resulting from the translation of these financial statements are reflected as accumulated other comprehensive income in shareholders’ equity and non-controlling interests.

Statement of Cash Flows [Policy Text Block]

Statement of Cash Flows

In accordance with Statement FASB ASC Topic 230, “Statement of Cash Flows,” cash flow from the Company's operations is calculated based upon the local currencies and translated to the reporting currency using an average foreign exchange rate for the reporting period. As a result, amounts related to assets and liabilities reported in the statement of cash flows will not necessarily agree with changes in the corresponding balances on the balance sheet.

Use of Estimates and Assumptions [Policy Text Block]

Use of Estimates and Assumptions

The preparation of financial statements in conformity with US GAAP requires management to make estimates and judgments that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities on the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company bases its estimates and judgments on historical experience and on various other assumptions and information that are believed to be reasonable under the circumstances. Estimates and assumptions of future events and their effects cannot be perceived with certainty and, accordingly, these estimates may change as new events occur, as more experience is acquired, as additional information is obtained and as the Company’s operating environment changes. Significant estimates and assumptions by management include, among others; useful lives of long-lived assets and intangible assets, valuation of inventory, accounts receivable and notes receivable, impairment analysis of long-lived assets, construction in progress, intangible assets and deferred taxes. While the Company believes that the estimates and assumptions used in the preparation of the financial statements are appropriate, actual results could differ from those estimates. Estimates and assumptions are periodically reviewed and the effects of revisions are reflected in the financial statements in the period they are determined to be necessary.

Cash and Cash Equivalents [Policy Text Block]

Cash and Cash Equivalents

Cash and cash equivalents include cash on hand, deposits in banks with maturities of three months or less, and all highly liquid investments which are unrestricted as to withdrawal or use, and which have original maturities of three months or less at the time of purchase.

As of September 30, 2016 and June 30, 2016, the Company’s uninsured bank balance was mainly maintained at financial institutions located in the PRC and HK. The uninsured bank balances of continuing operations were $20,778,742 and $29,783,152 as of September 30, 2016 and June 30, 2016, respectively. The uninsured bank balances of discontinued operations were $8,549 and $8,578 as of September 30, 2016 and June 30, 2016, respectively. The Company has no insured bank balance as of September 30, 2016 and June 30, 2016, respectively.

Accounts Receivable [Policy Text Block]

Accounts Receivable

Accounts receivable are recorded at the invoiced amount and do not bear interest. The Company extends unsecured credit to its customers in the ordinary course of business but mitigates the associated risks by performing credit checks and actively pursuing past due accounts. An allowance for doubtful accounts is established and determined based on management’s assessment of known requirements, aging of receivables, payment and bad debt history, the customer’s current credit worthiness, changes in customer payment patterns and the economic environment. From November 1, 2013, the Company changed its credit policy by offering ninety (90) day payment terms for sales agents, whereas the payment terms for sales agents before November 1, 2013 were thirty (30) day. As of September 30, 2016 and June 30, 2016, the balances of accounts receivable from the continuing operations, were $962,055 and $1,145,131, respectively. As of September 30, 2016 and June 30, 2016, the balances of accounts receivable from discontinued operations, were both nil. The Company determines the allowance based on aging data, historical collection experience, customer specific facts and economic conditions. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company evaluated the nature of all accounts receivable then provided allowance for doubtful accounts. The Company has determined that an allowance of $50,710 and $52,129 from the continuing operations was appropriate as of September 30, 2016 and June 30, 2016, respectively. The Company has determined that an allowance of nil from discontinued operations was appropriate as of September 30, 2016 and June 30, 2016.

Advance to Suppliers [Policy Text Block]

Advance to Suppliers

The Company periodically makes advances to certain vendors for purchases of raw materials, or service providers for services relating to construction plans for its plant, equipment and production lines for the GMP upgrading, and records these payments as advance to suppliers. As of September 30, 2016 and June 30, 2016, advance to suppliers, held for continuing operations, amounted to $153,816 and $154,430, respectively. As of September 30, 2016 and June 30, 2016, advance to suppliers, held for discontinued operations, amounted to $556 and $558, respectively.

Inventory [Policy Text Block]

Inventory

Inventory consists of raw materials, work in progress and finished goods of manufactured products.

Inventory is stated at lower of cost or market and consists of materials, labor and overhead. HLJ Huimeijia uses the weighted average method for inventory valuation. The other entities of the Company use the first-in, first-out (“FIFO”) method for inventory valuation. Overhead costs included in finished goods include direct labor cost and other costs directly applicable to the manufacturing process. The Company evaluates inventory for excess, slow moving, and obsolete inventory as well as inventory the value of which is in excess of its net realizable value. This evaluation includes analysis of sales levels by product and projections of future demand. If future demand or market conditions are less favorable than the Company’s projections, a write-down of inventory may be required, and would be reflected in cost of goods sold in the period the revision is made. There was no inventory allowance, held for continuing operations and discontinued operations, provided for the three months ended September 30, 2016 and 2015, respectively.

Impairment of Long-Lived Assets [Policy Text Block]

Impairment of Long-Lived Assets

The Company’s long-lived assets and other assets are reviewed for impairment in accordance with the guidance of the FASB ASC Topic 360-10, “Property, Plant, and Equipment,” and FASB ASC Topic 205, “Presentation of Financial Statements.” The Company tests for impairment losses on long-lived assets used in operations whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. Recoverability of an asset to be held and used is measured by a comparison of the carrying amount of the asset to the future undiscounted cash flows expected to be generated by the asset. If such asset is considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the asset exceeds its fair value. Impairment evaluations involve management’s estimates on asset useful lives and future cash flows. Actual useful lives and cash flows could be different from those estimated by management which could have a material effect on the Company’s reporting results and financial position. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. As of September 30, 2016 and June 30, 2016, the Company had not experienced impairment losses on its long-lived assets for both the continuing and discontinued operations. However, there can be no assurances that demand for the Company’s products or services will continue, which could result in an impairment of long-lived assets in the future.

Property, Plant and Equipment [Policy Text Block]

Property, Plant and Equipment

Property, plant and equipment are carried at the lower of cost or fair value. Maintenance, repairs and minor renewals are expensed as incurred, major renewals and improvements that extend the lives or increase the capacity of plant assets are capitalized.

When assets are retired or disposed of, the cost and accumulated depreciation are removed from the accounts, and any resulting gains or losses are included in the results of operations in the reporting period of disposition.

Depreciation is calculated on a straight-line basis over the estimated useful life of the assets. The depreciable lives applied are:

Building, Warehouse and Improvements	20 to 30 years
Office Equipment	3 to 7 years
Vehicles	5 to 15 years
Machinery and Equipment	7 to 15 years

Intangible Assets [Policy Text Block]

Intangible Assets

The Company evaluates intangible assets in accordance with FASB ASC Topic 350, “Intangibles — Goodwill and Other.” Intangible assets deemed to have indefinite lives are not amortized, but are subject to annual impairment tests. If the assumptions and estimates used to allocate the purchase price are not correct, or if business conditions change, purchase price adjustments or future asset impairment charges could be required. The value of the Company’s intangible assets could be impacted by future adverse changes such as: (i) any future declines in the Company’s operating results, (ii) a decline in the valuation of technology, including the valuation of the Company’s common stock, (iii) a significant slowdown in the worldwide economy, or (iv) any failure to meet the performance projections included in the Company’s forecasts of future operating results. In accordance with FASB ASC Topic 350, the Company tests intangible assets for impairment on an annual basis or more frequently if the Company believes indicators of impairment exist. Impairment evaluations involve management estimates of asset useful lives and future cash flows. Significant management judgment is required in the forecasts of future operating results that are used in the evaluations. It is possible, however, that the plans and estimates used may be incorrect. If the Company’s actual results, or the plans and estimates used in future impairment analysis, are lower than the original estimates used to assess the recoverability of these assets, we could incur additional impairment charges in a future period. Based on such evaluations, there was no impairment recorded for intangible assets, held for both the continuing and discontinued operations, for the three months ended September 30, 2016 and 2015, respectively.

Construction in Progress [Policy Text Block]

Construction in Progress

Construction in progress represents the costs incurred in connection with the construction of buildings or new additions to the Company’s plant facilities. Costs classified as construction in progress include all costs of obtaining the asset and bringing it to the location and condition necessary for its intended use. No depreciation is provided for construction in progress until such time as the assets are completed and are placed into service.

The Company reviews the carrying value of construction in progress for impairment whenever events and circumstances indicate that the carrying value of an asset may not be recoverable from the estimated future cash flows expected to result from its use and eventual disposition. In cases where undiscounted expected future cash flows are less than the carrying value of the assets, an impairment loss is recognized equal to an amount by which the carrying value exceeds the fair value of the assets. The factors considered by management in performing this assessment include current operating results, trends and prospects, the manner in which the property is used, and the effects of obsolescence, demand, competition and other economic factors. Based on this assessment, there was no impairment recorded for construction in progress, held for both the continuing and discontinued operations, for the three months ended September 30, 2016 and 2015, respectively.

Revenue Recognition [Policy Text Block]

Revenue Recognition

The Company recognizes revenue when it is both earned and realized or realizable. The Company’s policy is to recognize revenue when title to the product, ownership and risk of loss have transferred to the customer, persuasive evidence of an arrangement exits and collection of the sales proceeds is reasonably assured, all of which generally occur upon shipment of goods to customers. The majority of the Company’s revenue relates to the sale of inventory to customers, and revenue is recognized when title and the risks and rewards of ownership pass to the customer. Given the nature of the Company’s business and the applicable rules guiding revenue recognition, the Company’s revenue recognition practices do not contain estimates that materially affect the results of operations. The Company records revenue at the discounted selling price and allows its customers to return products for exchange or credit subject to certain limitations. A provision for such returns is recorded based upon historical experience. There has been no provision recorded for returns based upon historical experience, held for both the continuing and discontinued operations, for the three months ended September 30, 2016 and 2015, respectively.

Cost of Goods Sold [Policy Text Block]

Cost of Goods Sold

Cost of goods sold consists primarily of the costs of raw materials, freight charges, direct labor, depreciation of plants and machinery, warehousing and overhead costs associated with the manufacturing process and commission expenses.

Income Taxes [Policy Text Block]

Income Taxes

The Company adopts FASB ASC Topic 740, “Income Taxes,” which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized.

In July 2006, the FASB issued FIN 48(ASC 740-10), “Accounting for Uncertainty in Income Taxes — An Interpretation of FASB Statement No. 109 (ASC 740),” which requires income tax positions to meet a more-likely-than-not recognition threshold to be recognized in the financial statements. Under FIN 48(ASC 740-10), tax positions that previously failed to meet the more-likely-than-not threshold should be recognized in the first subsequent financial reporting period in which that threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not threshold should be derecognized in the first subsequent financial reporting period in which that threshold is no longer met.

As a result of the implementation of FIN 48 (ASC 740-10), the Company undertook a comprehensive review of its portfolio of tax positions in accordance with recognition standards established by FIN 48 (ASC 740-10). The Company recognized no material adjustments to liabilities or stockholders’ equity as a result of the implementation. The adoption of FIN 48 did not have a material impact on the Company’s financial statements.

The application of tax laws and regulations is subject to legal and factual interpretation, judgment and uncertainty. Tax laws and regulations themselves are subject to change as a result of changes in fiscal policy, changes in legislation, the evolution of regulations and court rulings. Therefore, the actual liability may be materially different from the Company’s estimates, which could result in the need to record additional tax liabilities or potentially reverse previously recorded tax liabilities or deferred tax asset valuation allowance.

Enterprise Income Tax [Policy Text Block]

Enterprise Income Tax

Under the Provisional Regulations of PRC Concerning Income Tax on Enterprises promulgated by the PRC (the “EIT Law”), income tax is payable by enterprises at a rate of 25% of their taxable income.

Value Added Tax [Policy Text Block]

Value Added Tax

The Provisional Regulations of PRC Concerning Value Added Tax promulgated by the State Council came into effect on January 1, 1994. Under these regulations and the Implementing Rules of the Provisional Regulations of the PRC Concerning Value Added Tax, value added tax (“VAT”) is imposed on goods sold in, or imported into, the PRC and on processing, repair and replacement services provided within the PRC.

VAT payable in the PRC is charged on an aggregated basis at a rate of 13% or 17% (depending on the type of goods involved) on the full price collected for the goods sold or, in the case of taxable services provided, at a rate of 17% on the charges for the taxable services provided, but excluding, in respect of both goods and services, any amount paid in respect of VAT included in the price or charges, and less any deductible VAT already paid by the taxpayer on purchases of goods and services in the same financial year. As of September 30, 2016 and June 30, 2016 VAT payables from the continuing operations were $197,378 and $183,813, respectively. As of September 30, 2016 and June 30, 2016, VAT payables were both nil for the discontinued operations.

Sales-Related Taxes [Policy Text Block]

Sales-Related Taxes

Pursuant to the tax law and regulations of the PRC, the Company is obligated to pay 7% and 5% of the annual VAT paid as taxes on maintaining and building cities and education additional fees, both of which belong to sales-related taxes. Sales-related taxes are recorded when sales revenue is recognized. Sales-related taxes from the continuing operations were $22,637 and $33,901 for the three months ended September 30, 2016 and 2015, respectively. Sales-related taxes from the discontinued operations were both nil for the three months ended September 30, 2016 and 2015.

Concentrations of Business and Credit Risks [Policy Text Block]

Concentrations of Business and Credit Risks

All of the Company’s manufacturing is located in the PRC. There can be no assurance that the Company will be able to successfully continue to manufacture its products and failure to do so would have a material adverse effect on the Company’s financial position, results of operations and cash flows. Also, the success of the Company’s operations is subject to numerous contingencies, some of which are beyond management’s control. These contingencies include general economic conditions, prices of raw materials, competition, governmental and political conditions, and changes in regulations. Since the Company is dependent on trade in the PRC, the Company is subject to various additional political, economic and other uncertainties. Among other risks, the Company’s operations will be subject to the risks of restrictions on transfer of funds, domestic customs, changing taxation policies, foreign exchange restrictions, and political and governmental regulations.

The Company operates in China, which may give rise to significant foreign currency risks from fluctuations and the degree of volatility of foreign exchange rates between U.S. dollars and the Chinese currency RMB. The results of operations denominated in foreign currency are translated at the average rate of exchange during the reporting periods.

Earnings Per Share [Policy Text Block]

Earnings Per Share

Basic earnings per common share is computed by dividing net earnings applicable to common shareholders by the weighted-average number of common shares outstanding during the period. When applicable, diluted earnings per common share is determined using the weighted-average number of common shares outstanding during the period, adjusted for the dilutive effect of common stock equivalents, consisting of shares that might be issued upon exercise of common stock options and warrants. For the three months ended September 30, 2016 and 2015, the Company had no potential dilutive common stock equivalents outstanding.

Potential common shares issued are calculated using the treasury stock method, which recognizes the use of proceeds that could be obtained upon the exercise of options and warrants in computing diluted earnings per share. It assumes that any proceeds would be used to purchase common stock at the average market price of the common stock during the period.

FASB ASC Topic 260, “Earnings Per Share,” requires a reconciliation of the numerator and denominator of the basic and diluted earnings per share (EPS) computations.

Recent Accounting Pronouncements [Policy Text Block]

Recent Accounting Pronouncements

In August 2016, the FASB has issued Accounting Standards Update (“ASU”) No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments, to address diversity in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The amendments provide guidance on the following eight specific cash flow issues: (1) Debt Prepayment or Debt Extinguishment Costs; (2) Settlement of Zero-Coupon Debt Instruments or Other Debt Instruments with Coupon Interest Rates That Are Insignificant in Relation to the Effective Interest Rate of the Borrowing; (3) Contingent Consideration Payments Made after a Business Combination; (4)Proceeds from the Settlement of Insurance Claims; (5) Proceeds from the Settlement of Corporate-Owned Life Insurance Policies, including Bank-Owned; (6) Life Insurance Policies; (7) Distributions Received from Equity Method Investees; (8) Beneficial Interests in Securitization Transactions; and Separately Identifiable Cash Flows and Application of the Predominance Principle. The amendments are effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2019. Early adoption is permitted, including adoption in an interim period. The amendments should be applied using a retrospective transition method to each period presented. If it is impracticable to apply the amendments retrospectively for some of the issues, the amendments for those issues would be applied prospectively as of the earliest date practicable. The Company is currently evaluating the impact of this new standard on its consolidated financial statements and related disclosures.

In October 2016, the FASB has issued ASU No. 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory. The amendments require an entity to recognize income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs and remove the exception to postpone recognition until the asset has been sold to an outside party. The amendments are effective for public business entities for annual reporting periods beginning after December 15, 2017, including interim reporting periods within those annual reporting periods. For all other entities, the amendments are effective for annual reporting periods beginning after December 15, 2018, and interim reporting periods within annual reporting periods beginning after December 15, 2019. Early adoption is permitted. The Company is currently evaluating the impact of this new standard on its consolidated financial statements and related disclosures.

In October 2016, the FASB has issued ASU No. 2016-17, Consolidation (Topic 810): Interest Held through Related Parties That Are under Common Control, to provide guidance on the evaluation of whether a reporting entity is the primary beneficiary of a VIE by amending how a reporting entity, that is a single decision maker of a VIE, treats indirect interests in that entity held through related parties that are under common control. The amendments are effective for public business entities for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2016, and interim periods within fiscal years beginning after December 15, 2017. Early adoption is permitted, including adoption in an interim period. The Company is currently evaluating the impact of this new standard on its consolidated financial statements and related disclosures.

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SIGNIFICANT ACCOUNTING POLICIES (Tables)

3 Months Ended

Sep. 30, 2016

Schedule of Useful Life of Property Plant and Equipment [Table Text Block]

Building, Warehouse and Improvements	20 to 30 years
Office Equipment	3 to 7 years
Vehicles	5 to 15 years
Machinery and Equipment	7 to 15 years

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INVENTORY (Tables)

3 Months Ended

Sep. 30, 2016

Schedule of Inventory, Current [Table Text Block]

		September 30,		June 30,
		2016		2016
Raw Materials	$	132,272	$	122,569
Supplies and Packing Materials		135,742		130,472
Work-in-Progress		131,323		118,233
Finished Goods		57,878		48,713
Total		457,215		419,987
Less: Inventory, Held for Discontinued Operations		5,186		5,203
Inventory, Held for Continuing Operations	$	452,029	$	414,784

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CONSTRUCTION IN PROGRESS (Tables)

3 Months Ended

Sep. 30, 2016

Construction In Progress [Table Text Block]

		September 30,		June 30,
		2016		2016
Plant - HLJ Huimeijia	$	676,307	$	670,051
Plant and Production Lines - Huimeijia		1,800		1,806
Total		678,107		671,857
Less: Construction in Progress, Held for Discontinued Operations		1,800		1,806
Construction in Progress, Held for Continuing Operations	$	676,307	$	670,051

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PROPERTY, PLANT AND EQUIPMENT (Tables)

3 Months Ended

Sep. 30, 2016

Property, Plant and Equipment [Table Text Block]

		September 30,			June 30,
		2016			2016
Building, Warehouses and Improvements	$	4,345,412		$	4,360,191
Machinery and Equipment		1,228,683			1,232,861
Office Equipment		69,095			69,330
Vehicles		203,764			204,457
Less: Accumulated Depreciation		(2,072,636	)		(1,998,278	)
Total		3,774,318			3,868,561
Less: Property and Equipment, net, Held for Discontinued Operations		1,789			1,796
Property and Equipment, net, held for continuing operations	$	3,772,529		$	3,866,765

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INTANGIBLE ASSETS (Tables)

3 Months Ended

Sep. 30, 2016

Schedule of Finite-Lived Intangible Assets [Table Text Block]

		September 30, 2016			June 30, 2016
Land Use Rights – Humankind	$	950,436		$	953,670
Health Supplement Product Patents – Humankind		4,498,763			4,514,061
Pharmaceutical Patents - HLJ Huimeijia		134,361			134,817
Land Use Rights - HLJ Huimeijia		650,084			652,295
Less: Accumulated Amortization		(2,168,103	)		(2,063,784	)
Total		4,065,541			4,191,059
Less: Intangible Assets, net, Held for Discontinued Operations		-			-
Intangible Assets, net, Held for Continuing Operations	$	4,065,541		$	4,191,059

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RELATED PARTY DEBTS (Tables)

3 Months Ended

Sep. 30, 2016

Schedule of Related Party Transactions [Table Text Block]

		S eptember 30, 201 6		June 30, 2016
Mr. Xin Sun	$	2,755,786	$	2,678,220
Mr. Kai Sun		35,066		35,186
Total		2,790,852		2,713,406
Less: Related Party Debts, Held for Discontinued Operations		-		-
Related Party Debts, Held for Continuing Operations	$	2,790,852	$	2,713,406

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INCOME TAXES (Tables)

3 Months Ended

Sep. 30, 2016

Schedule of Provision for Income Taxes [Table Text Block]

		For the Three Months Ended
		September 30,
		2016		2015
Current provision:
USA	$	-	$	-
China		54,030		32,406
Total current provision		54,030		32,406
Deferred provision:
USA		-		-
China		-		-
Total deferred provision		-		-
Total provision for income taxes		54,030		32,406
Less: Provision for income taxes, held for discontinued operations		-		-
Provision for income taxes, held for continuing operations	$	54,030	$	32,406

Schedule of Deferred Tax Assets and Liabilities [Table Text Block]

		September 30,			June 30,
		2016			2016
Deferred tax assets
Net operating loss carry forward	$	112,236		$	118,259
Allowance for doubtful accounts		-			-
Valuation allowance		(112,236	)		(118,259	)
Deferred tax assets, net		-			-
Less: Deferred tax assets, net, held for discontinued operations		-			-
Deferred tax assets, net, held for continuing operations	$	-		$	-

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SEGMENT REPORTING (Tables)

3 Months Ended

Sep. 30, 2016

Schedule of Segment Reporting Information, by Segment from Continuing Operations [Table Text Block]

		For the Three Months Ended September 30, 2016										For the Three Months Ended September 30, 2015
										Consolidated										Consolidated
										from										from
		HLJ								continuing		HLJ								continuing
		Huimeijia			Humankind		Others			operations		Huimeijia			Humankind		Others			operations
Revenues	$	100		$	1,180,068	$	-		$	1,180,168	$	293,756		$	1,662,312	$	-		$	1,956,068
Cost of revenues		58			755,227		-			755,285		250,346			1,168,618		-			1,418,964
Gross profit		42			424,841		-			424,883		43,410			493,694		-			537,104
Interest expense		21,686			-		-			21,686		31,624			-		-			31,624
Depreciation and amortization		14,230			134,645		-			148,875		18,792			163,169		-			181,961
Income tax		-			54,030		-			54,030		-			32,406		-			32,406
Net income (loss)		(137,873	)		162,091		(195	)		24,023		(127,282	)		97,216		(74	)		(30,140	)
Total capital expenditures		-			-		-			-		-			454		-			454
Total assets	$	2,922,517		$	37,194,994	$	1,444		$	40,118,955	$	3,282,095		$	37,246,334	$	2,024		$	40,530,453

Schedule of Segment Reporting Information, by Segment from Discontinued Operations [Table Text Block]

		For the Three Months Ended				For the Three Months Ended
		September 30, 2016				September 30, 2015
				Consolidated from					Consolidated from
				discontinued					discontinued
		Huimeijia		operations		Huimeijia			operations
Revenues	$	-	$	-	$	-		$	-
Cost of revenues		-		-		-			-
Gross profit		-		-		-			-
Interest expense		-		-		-			-
Depreciation and amortization		-		-		196			196
Income tax		-		-		-			-
Net loss		-		-		(196	)		(196	)
Total capital expenditures		-		-		-			-
Total assets	$	17,880	$	17,880	$	19,341		$	19,341

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DISCONTINUED OPERATIONS (Tables)

3 Months Ended

Sep. 30, 2016

Schedule of Condensed Balance Sheet [Table Text Block]

		September 30, 2016			June 30, 2016
ASSETS
Current Assets
Cash and cash equivalents	$	8,549		$	8,578
Inventory		5,186			5,203
Advance to suppliers		556			558
Total Current Assets		14,291			14,339
Property, plant and equipment, net		1,789			1,796
Construction in progress		1,800			1,806
Total Assets	$	17,880		$	17,941
LIABILITIES AND EQUITY
Current Liabilities:	$			$
Accounts payable and accrued expenses		556			558
Other payables		20			16
Advance from customers		479,868			481,500
Taxes payable		(60	)		(61	)
Total Current Liabilities		480,384			482,013
Total Liabilities	$	480,384		$	482,013

Schedule of Condensed Income Statement [Table Text Block]

		For the Three Months Ended
		September 30,
		2016		2015
Operating Expenses
Depreciation and amortization expenses	$	-	$	(196	)
Total Operating Expenses		-		(196	)
Loss from Operations		-		(196	)
Loss before Income Taxes		-		(196	)
Net Loss from Discontinued Operations	$	-	$	(196	)

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ORGANIZATION AND BUSINESS BACKGROUND (Narrative) (Details) - 3 months ended Sep. 30, 2016	USD ($) shares	CNY (¥) shares
Organization And Business Background 1	100.00%	100.00%
Organization And Business Background 2 | $	$ 60,408
Organization And Business Background 3	99.00%	99.00%
Organization And Business Background 4	1.00%	1.00%
Organization And Business Background 5 | shares	61,203,088	61,203,088
Organization And Business Background 6	98.30%	98.30%
Organization And Business Background 7	62,234,737	62,234,737
Organization And Business Background 8 | shares	28,200,000	28,200,000
Organization And Business Background 9	296	296
Organization And Business Background 10 | shares	33,003,088	33,003,088
Organization And Business Background 11	53.03%	53.03%
Organization And Business Background 12 | $	$ 16,339,869
Organization And Business Background 13 | ¥		¥ 100,000,000
Organization And Business Background 14	21	21
Organization And Business Background 15	99.00%	99.00%
Organization And Business Background 16	1.00%	1.00%
Organization And Business Background 17	19	19
Organization And Business Background 18 | ¥		¥ 8,000,000
Organization And Business Background 19 | $	$ 1,306,186
Organization And Business Background 20	40.00%	40.00%

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SIGNIFICANT ACCOUNTING POLICIES (Narrative) (Details)	3 Months Ended
	Sep. 30, 2016 USD ($)
Significant Accounting Policies 1	$ 20,778,742
Significant Accounting Policies 2	29,783,152
Significant Accounting Policies 3	8,549
Significant Accounting Policies 4	8,578
Significant Accounting Policies 5	962,055
Significant Accounting Policies 6	$ 1,145,131
Significant Accounting Policies 7	0
Significant Accounting Policies 8	$ 50,710
Significant Accounting Policies 9	$ 52,129
Significant Accounting Policies 10	0
Significant Accounting Policies 11	$ 153,816
Significant Accounting Policies 12	154,430
Significant Accounting Policies 13	556
Significant Accounting Policies 14	$ 558
Significant Accounting Policies 15	48
Significant Accounting Policies 16	25.00%
Significant Accounting Policies 17	13.00%
Significant Accounting Policies 18	17.00%
Significant Accounting Policies 19	17.00%
Significant Accounting Policies 20	$ 197,378
Significant Accounting Policies 21	$ 183,813
Significant Accounting Policies 22	0
Significant Accounting Policies 23	7.00%
Significant Accounting Policies 24	5.00%
Significant Accounting Policies 25	$ 22,637
Significant Accounting Policies 26	$ 33,901
Significant Accounting Policies 27	0

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ASSETS SALE (Narrative) (Details) - 3 months ended Sep. 30, 2016	USD ($) d	CNY (¥) d
Assets Sale 1	100.00%	100.00%
Assets Sale 2 | ¥		¥ 8,000,000
Assets Sale 3 | $	$ 1,306,186
Assets Sale 4	19	19
Assets Sale 5	19	19
Assets Sale 6	19	19
Assets Sale 7 | ¥		¥ 8,000,000
Assets Sale 8 | $	$ 1,306,186
Assets Sale 9	100.00%	100.00%
Assets Sale 10 | ¥		¥ 8,000,000
Assets Sale 11 | $	$ 1,306,186
Assets Sale 12	40.00%	40.00%
Assets Sale 13	10	10
Assets Sale 14	40.00%	40.00%
Assets Sale 15	10	10
Assets Sale 16	15.00%	15.00%
Assets Sale 17	10	10
Assets Sale 18	5.00%	5.00%
Assets Sale 19	10	10
Assets Sale 20	40.00%	40.00%

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ACCOUNTS RECEIVABLE (Narrative) (Details)	3 Months Ended
	Sep. 30, 2016 USD ($)
Accounts Receivable 1	$ 962,055
Accounts Receivable 2	1,145,131
Accounts Receivable 3	50,710
Accounts Receivable 4	$ 52,129
Accounts Receivable 5	0
Accounts Receivable 6	0

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CONSTRUCTION IN PROGRESS (Narrative) (Details)	3 Months Ended
	Sep. 30, 2016 USD ($)	Sep. 30, 2016 CNY (¥)
Construction In Progress 1 | $	$ 2,090,000
Construction In Progress 2 | ¥		¥ 12,800,000
Construction In Progress 3	35.00%	35.00%
Construction In Progress 4 | $	$ 676,307
Construction In Progress 5 | ¥		¥ 4,509,953

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PROPERTY, PLANT AND EQUIPMENT (Narrative) (Details)	3 Months Ended
	Sep. 30, 2016 USD ($)	Sep. 30, 2016 CNY (¥)
Property, Plant And Equipment 1	$ 81,187
Property, Plant And Equipment 2	$ 85,735
Property, Plant And Equipment 3	0	0
Property, Plant And Equipment 4	$ 196
Property, Plant And Equipment 5	37,485
Property, Plant And Equipment 6	34,511
Property, Plant And Equipment 7	43,702
Property, Plant And Equipment 8	$ 51,224
Property, Plant And Equipment 9	0	0
Property, Plant And Equipment 10	$ 196
Property, Plant And Equipment 11	0	0
Property, Plant And Equipment 12	$ 1,670,945
Property, Plant And Equipment 13	1,499,588
Property, Plant And Equipment 14 | ¥		¥ 10,000,000
Property, Plant And Equipment 15	1,676,627
Property, Plant And Equipment 16	$ 1,504,687
Property, Plant And Equipment 17 | ¥		¥ 10,000,000

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INTANGIBLE ASSETS (Narrative) (Details) - 3 months ended Sep. 30, 2016	USD ($) yr	CNY (¥) yr
Intangible Assets 1 | yr	50	50
Intangible Assets 2 | yr	70	70
Intangible Assets 3	$ 111,390
Intangible Assets 4	$ 147,450
Intangible Assets 5	0	0
Intangible Assets 6	$ 650,084
Intangible Assets 7	1,499,588
Intangible Assets 8 | ¥		¥ 10,000,000
Intangible Assets 9	652,295
Intangible Assets 10	$ 1,504,687
Intangible Assets 11 | ¥		¥ 10,000,000

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SHORT-TERM LOAN (Narrative) (Details)	3 Months Ended
	Sep. 30, 2016 USD ($)	Sep. 30, 2016 CNY (¥)
Short-term Loan 1 | ¥		¥ 10,000,000
Short-term Loan 2	5.66%	5.66%
Short-term Loan 3	$ 1,499,588
Short-term Loan 4	$ 1,504,687
Short-term Loan 5	0	0
Short-term Loan 6	$ 21,686
Short-term Loan 7	$ 31,624
Short-term Loan 8	0	0

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INCOME TAXES (Narrative) (Details)	3 Months Ended
	Sep. 30, 2016
Income Taxes 1	100.00%
Income Taxes 2	25.00%
Income Taxes 3	100.00%

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MAJOR SUPPLIERS AND CUSTOMERS (Narrative) (Details)	3 Months Ended
	Sep. 30, 2016
Major Suppliers And Customers 1	88.00%
Major Suppliers And Customers 2	78.00%
Major Suppliers And Customers 3	10.00%
Major Suppliers And Customers 4	75.00%
Major Suppliers And Customers 5	81.00%
Major Suppliers And Customers 6	16.00%
Major Suppliers And Customers 7	15.00%
Major Suppliers And Customers 8	13.00%
Major Suppliers And Customers 9	13.00%
Major Suppliers And Customers 10	12.00%
Major Suppliers And Customers 11	12.00%
Major Suppliers And Customers 12	42.00%
Major Suppliers And Customers 13	11.00%
Major Suppliers And Customers 14	11.00%
Major Suppliers And Customers 15	10.00%
Major Suppliers And Customers 16	10.00%

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Schedule of Useful Life of Property Plant and Equipment (Details)	3 Months Ended
	Sep. 30, 2016 USD ($) yr
Significant Accounting Policies Schedule Of Useful Life Of Property Plant And Equipment 1 | $	$ 20
Significant Accounting Policies Schedule Of Useful Life Of Property Plant And Equipment 2 | yr	30
Significant Accounting Policies Schedule Of Useful Life Of Property Plant And Equipment 3 | $	$ 3
Significant Accounting Policies Schedule Of Useful Life Of Property Plant And Equipment 4 | yr	7
Significant Accounting Policies Schedule Of Useful Life Of Property Plant And Equipment 5 | $	$ 5
Significant Accounting Policies Schedule Of Useful Life Of Property Plant And Equipment 6 | yr	15
Significant Accounting Policies Schedule Of Useful Life Of Property Plant And Equipment 7 | $	$ 7
Significant Accounting Policies Schedule Of Useful Life Of Property Plant And Equipment 8 | yr	15

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Schedule of Inventory, Current (Details)	3 Months Ended
	Sep. 30, 2016 USD ($)
Inventory Schedule Of Inventory, Current 1	$ 132,272
Inventory Schedule Of Inventory, Current 2	122,569
Inventory Schedule Of Inventory, Current 3	135,742
Inventory Schedule Of Inventory, Current 4	130,472
Inventory Schedule Of Inventory, Current 5	131,323
Inventory Schedule Of Inventory, Current 6	118,233
Inventory Schedule Of Inventory, Current 7	57,878
Inventory Schedule Of Inventory, Current 8	48,713
Inventory Schedule Of Inventory, Current 9	457,215
Inventory Schedule Of Inventory, Current 10	419,987
Inventory Schedule Of Inventory, Current 11	5,186
Inventory Schedule Of Inventory, Current 12	5,203
Inventory Schedule Of Inventory, Current 13	452,029
Inventory Schedule Of Inventory, Current 14	$ 414,784

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Construction In Progress (Details)	3 Months Ended
	Sep. 30, 2016 USD ($)
Construction In Progress Construction In Progress 1	$ 676,307
Construction In Progress Construction In Progress 2	670,051
Construction In Progress Construction In Progress 3	1,800
Construction In Progress Construction In Progress 4	1,806
Construction In Progress Construction In Progress 5	678,107
Construction In Progress Construction In Progress 6	671,857
Construction In Progress Construction In Progress 7	1,800
Construction In Progress Construction In Progress 8	1,806
Construction In Progress Construction In Progress 9	676,307
Construction In Progress Construction In Progress 10	$ 670,051

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Property, Plant and Equipment (Details)	3 Months Ended
	Sep. 30, 2016 USD ($)
Property, Plant And Equipment Property, Plant And Equipment 1	$ 4,345,412
Property, Plant And Equipment Property, Plant And Equipment 2	4,360,191
Property, Plant And Equipment Property, Plant And Equipment 3	1,228,683
Property, Plant And Equipment Property, Plant And Equipment 4	1,232,861
Property, Plant And Equipment Property, Plant And Equipment 5	69,095
Property, Plant And Equipment Property, Plant And Equipment 6	69,330
Property, Plant And Equipment Property, Plant And Equipment 7	203,764
Property, Plant And Equipment Property, Plant And Equipment 8	204,457
Property, Plant And Equipment Property, Plant And Equipment 9	(2,072,636)
Property, Plant And Equipment Property, Plant And Equipment 10	(1,998,278)
Property, Plant And Equipment Property, Plant And Equipment 11	3,774,318
Property, Plant And Equipment Property, Plant And Equipment 12	3,868,561
Property, Plant And Equipment Property, Plant And Equipment 13	1,789
Property, Plant And Equipment Property, Plant And Equipment 14	1,796
Property, Plant And Equipment Property, Plant And Equipment 15	3,772,529
Property, Plant And Equipment Property, Plant And Equipment 16	$ 3,866,765

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Schedule of Finite-Lived Intangible Assets (Details)	3 Months Ended
	Sep. 30, 2016 USD ($)
Intangible Assets Schedule Of Finite-lived Intangible Assets 1	$ 950,436
Intangible Assets Schedule Of Finite-lived Intangible Assets 2	953,670
Intangible Assets Schedule Of Finite-lived Intangible Assets 3	4,498,763
Intangible Assets Schedule Of Finite-lived Intangible Assets 4	4,514,061
Intangible Assets Schedule Of Finite-lived Intangible Assets 5	134,361
Intangible Assets Schedule Of Finite-lived Intangible Assets 6	134,817
Intangible Assets Schedule Of Finite-lived Intangible Assets 7	650,084
Intangible Assets Schedule Of Finite-lived Intangible Assets 8	652,295
Intangible Assets Schedule Of Finite-lived Intangible Assets 9	(2,168,103)
Intangible Assets Schedule Of Finite-lived Intangible Assets 10	(2,063,784)
Intangible Assets Schedule Of Finite-lived Intangible Assets 11	4,065,541
Intangible Assets Schedule Of Finite-lived Intangible Assets 12	4,191,059
Intangible Assets Schedule Of Finite-lived Intangible Assets 13	0
Intangible Assets Schedule Of Finite-lived Intangible Assets 14	0
Intangible Assets Schedule Of Finite-lived Intangible Assets 15	4,065,541
Intangible Assets Schedule Of Finite-lived Intangible Assets 16	$ 4,191,059

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Schedule of Related Party Transactions (Details)	3 Months Ended
	Sep. 30, 2016 USD ($)
Related Party Debts Schedule Of Related Party Transactions 1	$ 2,755,786
Related Party Debts Schedule Of Related Party Transactions 2	2,678,220
Related Party Debts Schedule Of Related Party Transactions 3	35,066
Related Party Debts Schedule Of Related Party Transactions 4	35,186
Related Party Debts Schedule Of Related Party Transactions 5	2,790,852
Related Party Debts Schedule Of Related Party Transactions 6	2,713,406
Related Party Debts Schedule Of Related Party Transactions 7	0
Related Party Debts Schedule Of Related Party Transactions 8	0
Related Party Debts Schedule Of Related Party Transactions 9	2,790,852
Related Party Debts Schedule Of Related Party Transactions 10	$ 2,713,406

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Schedule of Provision for Income Taxes (Details)	3 Months Ended
	Sep. 30, 2016 USD ($)
Income Taxes Schedule Of Provision For Income Taxes 1	$ 0
Income Taxes Schedule Of Provision For Income Taxes 2	0
Income Taxes Schedule Of Provision For Income Taxes 3	54,030
Income Taxes Schedule Of Provision For Income Taxes 4	32,406
Income Taxes Schedule Of Provision For Income Taxes 5	54,030
Income Taxes Schedule Of Provision For Income Taxes 6	32,406
Income Taxes Schedule Of Provision For Income Taxes 7	0
Income Taxes Schedule Of Provision For Income Taxes 8	0
Income Taxes Schedule Of Provision For Income Taxes 9	0
Income Taxes Schedule Of Provision For Income Taxes 10	0
Income Taxes Schedule Of Provision For Income Taxes 11	0
Income Taxes Schedule Of Provision For Income Taxes 12	0
Income Taxes Schedule Of Provision For Income Taxes 13	54,030
Income Taxes Schedule Of Provision For Income Taxes 14	32,406
Income Taxes Schedule Of Provision For Income Taxes 15	0
Income Taxes Schedule Of Provision For Income Taxes 16	0
Income Taxes Schedule Of Provision For Income Taxes 17	54,030
Income Taxes Schedule Of Provision For Income Taxes 18	$ 32,406

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Schedule of Deferred Tax Assets and Liabilities (Details)	3 Months Ended
	Sep. 30, 2016 USD ($)
Income Taxes Schedule Of Deferred Tax Assets And Liabilities 1	$ 112,236
Income Taxes Schedule Of Deferred Tax Assets And Liabilities 2	118,259
Income Taxes Schedule Of Deferred Tax Assets And Liabilities 3	0
Income Taxes Schedule Of Deferred Tax Assets And Liabilities 4	0
Income Taxes Schedule Of Deferred Tax Assets And Liabilities 5	(112,236)
Income Taxes Schedule Of Deferred Tax Assets And Liabilities 6	(118,259)
Income Taxes Schedule Of Deferred Tax Assets And Liabilities 7	0
Income Taxes Schedule Of Deferred Tax Assets And Liabilities 8	0
Income Taxes Schedule Of Deferred Tax Assets And Liabilities 9	0
Income Taxes Schedule Of Deferred Tax Assets And Liabilities 10	0
Income Taxes Schedule Of Deferred Tax Assets And Liabilities 11	0
Income Taxes Schedule Of Deferred Tax Assets And Liabilities 12	$ 0

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Schedule of Segment Reporting Information, by Segment from Continuing Operations (Details)	3 Months Ended
	Sep. 30, 2016 USD ($)
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 1	$ 100
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 2	1,180,068
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 3	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 4	1,180,168
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 5	293,756
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 6	1,662,312
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 7	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 8	1,956,068
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 9	58
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 10	755,227
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 11	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 12	755,285
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 13	250,346
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 14	1,168,618
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 15	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 16	1,418,964
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 17	42
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 18	424,841
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 19	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 20	424,883
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 21	43,410
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 22	493,694
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 23	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 24	537,104
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 25	21,686
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 26	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 27	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 28	21,686
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 29	31,624
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 30	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 31	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 32	31,624
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 33	14,230
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 34	134,645
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 35	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 36	148,875
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 37	18,792
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 38	163,169
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 39	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 40	181,961
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 41	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 42	54,030
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 43	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 44	54,030
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 45	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 46	32,406
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 47	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 48	32,406
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 49	(137,873)
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 50	162,091
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 51	(195)
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 52	24,023
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 53	(127,282)
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 54	97,216
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 55	(74)
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 56	(30,140)
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 57	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 58	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 59	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 60	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 61	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 62	454
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 63	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 64	454
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 65	2,922,517
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 66	37,194,994
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 67	1,444
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 68	40,118,955
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 69	3,282,095
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 70	37,246,334
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 71	2,024
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Continuing Operations 72	$ 40,530,453

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Schedule of Segment Reporting Information, by Segment from Discontinued Operations (Details)	3 Months Ended
	Sep. 30, 2016 USD ($)
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 1	$ 0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 2	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 3	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 4	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 5	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 6	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 7	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 8	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 9	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 10	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 11	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 12	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 13	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 14	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 15	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 16	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 17	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 18	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 19	196
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 20	196
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 21	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 22	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 23	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 24	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 25	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 26	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 27	(196)
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 28	(196)
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 29	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 30	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 31	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 32	0
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 33	17,880
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 34	17,880
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 35	19,341
Segment Reporting Schedule Of Segment Reporting Information, By Segment From Discontinued Operations 36	$ 19,341

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Schedule of Condensed Balance Sheet (Details)	3 Months Ended
	Sep. 30, 2016 USD ($)
Discontinued Operations Schedule Of Condensed Balance Sheet 1	$ 8,549
Discontinued Operations Schedule Of Condensed Balance Sheet 2	8,578
Discontinued Operations Schedule Of Condensed Balance Sheet 3	5,186
Discontinued Operations Schedule Of Condensed Balance Sheet 4	5,203
Discontinued Operations Schedule Of Condensed Balance Sheet 5	556
Discontinued Operations Schedule Of Condensed Balance Sheet 6	558
Discontinued Operations Schedule Of Condensed Balance Sheet 7	14,291
Discontinued Operations Schedule Of Condensed Balance Sheet 8	14,339
Discontinued Operations Schedule Of Condensed Balance Sheet 9	1,789
Discontinued Operations Schedule Of Condensed Balance Sheet 10	1,796
Discontinued Operations Schedule Of Condensed Balance Sheet 11	1,800
Discontinued Operations Schedule Of Condensed Balance Sheet 12	1,806
Discontinued Operations Schedule Of Condensed Balance Sheet 13	17,880
Discontinued Operations Schedule Of Condensed Balance Sheet 14	17,941
Discontinued Operations Schedule Of Condensed Balance Sheet 15	556
Discontinued Operations Schedule Of Condensed Balance Sheet 16	558
Discontinued Operations Schedule Of Condensed Balance Sheet 17	20
Discontinued Operations Schedule Of Condensed Balance Sheet 18	16
Discontinued Operations Schedule Of Condensed Balance Sheet 19	479,868
Discontinued Operations Schedule Of Condensed Balance Sheet 20	481,500
Discontinued Operations Schedule Of Condensed Balance Sheet 21	(60)
Discontinued Operations Schedule Of Condensed Balance Sheet 22	(61)
Discontinued Operations Schedule Of Condensed Balance Sheet 23	480,384
Discontinued Operations Schedule Of Condensed Balance Sheet 24	482,013
Discontinued Operations Schedule Of Condensed Balance Sheet 25	480,384
Discontinued Operations Schedule Of Condensed Balance Sheet 26	$ 482,013

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Schedule of Condensed Income Statement (Details)	3 Months Ended
	Sep. 30, 2016 USD ($)
Discontinued Operations Schedule Of Condensed Income Statement 1	$ 0
Discontinued Operations Schedule Of Condensed Income Statement 2	(196)
Discontinued Operations Schedule Of Condensed Income Statement 3	0
Discontinued Operations Schedule Of Condensed Income Statement 4	(196)
Discontinued Operations Schedule Of Condensed Income Statement 5	0
Discontinued Operations Schedule Of Condensed Income Statement 6	(196)
Discontinued Operations Schedule Of Condensed Income Statement 7	0
Discontinued Operations Schedule Of Condensed Income Statement 8	(196)
Discontinued Operations Schedule Of Condensed Income Statement 9	0
Discontinued Operations Schedule Of Condensed Income Statement 10	$ (196)