10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended December 31, 2014

o TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from ______________ to ______________

China Ginseng Holdings, Inc.

(Exact name of registrant as specified in its charter)

Nevada	20-3348253
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)

1562 Jie Fang Great Road 16 FL  Zhongji Building,  Suite 1062-1063 Nanguan District, Changchun City, China
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone (01186) 43188952022

SEC File Number:  000-54072

N/A

(Former name, former address and former three months, if changed since last report)

Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interative 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 o No o

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	o	Accelerated filer	o
Non-accelerated file	o	Smaller Reporting Company	x

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

As of February 9, 2015, there were 44,397,297 shares issued and outstanding of the registrant’s common stock.

TABLE OF CONTENTS

PART I — FINANCIAL INFORMATION
Item 1.     Financial Statements	F-1
Item 2.     Management’s Discussion and Analysis or Plan of Operation.	3
Item 3.     Quantitative and Qualitative Disclosure about Market Risk	10
Item 4.     Controls and Procedures.	10
PART II — OTHER INFORMATION
Item 6.     Exhibits.	10

PART I — FINANCIAL INFORMATION

Contents
Consolidated Balance Sheets as of December 31, 2014 (Unaudited) and June 30, 2014	F-2
Consolidated Statements of Operations and Comprehensive Loss for the Three and Six Months Ended December 31, 2014 and 2013 (Unaudited)	F-3
Consolidated Statements of Cash Flows for the Six Months Ended December 31, 2014 and 2013 (Unaudited)	F-4
Notes to Consolidated Financial Statements, December 31, 2014 (Unaudited)	F-6

F-1

China Ginseng Holdings, Inc. and Subsidiaries

CONSOLIDATED BALANCE SHEETS

	December 31, 2014			June 30, 2014
	(Unaudited)
ASSETS
CURRENT ASSETS
Cash	$	132,215		$	24,782
Accounts receivable, net		1,023,341			1,077,506
Inventory		355,338			233,412
Due from related parties		28,726			11,900
Prepaid expenses		74,152			73,745
Total Current Assets		1,613,772			1,421,345
PROPERTY AND EQUIPMENT, net of accumulated depreciation of
$492,310 and $447,749 at December 31 and June 30, 2014, respectively		1,427,972			1,458,558
OTHER ASSETS
Ginseng crops, non-current portion		26,426			6,721
Deposit on equipment		5,962,214			5,929,461
Intangible assets-patents, net of accumulated amortization of $19,988
and $15,286 at December 31, and June 30, 2014, respectively		1,699			2,975
Deferred income tax asset		1,238			1,231
Total Assets	$	9,033,321		$	8,820,291
LIABILITIES AND STOCKHOLDERS’ DEFICIT
CURRENT LIABILITIES
Loan payable- equipment purchase	$	5,960,787		$	5,928,042
Loan payable- building purchase		1,307,403			1,300,221
Loans payable- other		2,327,784			1,984,219
Notes payable- related parties		1,527,469			1,389,124
Accounts payable		2,226,504			1,768,153
Accrued expenses		678,590			334,372
Taxes payable		72,225			72,505
Payments received in advance		263,117			261,671
Total Current Liabilities		14,363,879			13,038,307
OTHER LIABILITIES
Liabilities of discontinued operations		513,306			510,487
Payable to farmers		878,791			873,964
Total Liabilities		15,755,976			14,422,758
STOCKHOLDERS’ DEFICIT
Common Stock, $0.001 par value; 50,000,000 shares authorized; 44,397,297 shares issued and outstanding at December 31 and June 30, 2014, respectively		44,398			44,398
Additional paid-in capital		7,654,785			7,606,599
Accumulated deficit		(15,486,882	)		(14,169,335	)
Accumulated other comprehensive income		1,065,044			915,871
Total Stockholders’ Deficit		(6,722,655	)		(5,602,467	)
Total Liabilities and Stockholders’ Deficit	$	9,033,321		$	8,820,291

See accompanying notes to consolidated financial statements.

F-2

CHINA GINSENG HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (UNAUDITED)

	For the Three Months Ended						For the Six Months Ended
	December 31,						December 31,
	2014			2013			2014			2013
REVENUES	$	146,972		$	2,484,432		$	152,214		$	2,546,825
COSTS AND EXPENSES
Cost of goods sold		112,917			2,070,925			115,818			2,077,579
Selling, general and administrative expenses		499,522			581,182			817,027			841,517
Bad debt expense (recovered)		(42,250	)		(16,138	)		(42,250	)		(55,348	)
Depreciation and amortization		15,625			30,690			45,934			61,166
Total Costs and Expenses		585,814			2,666,659			936,529			2,924,914
OTHER EXPENSE
Interest expense		307,512			332,213			533,232			392,233
Net Other Expense		307,512			332,213			533,232			392,233
LOSS BEFORE INCOME TAXES		(746,354	)		(514,440	)		(1,317,547	)		(770,322	)
PROVISION FOR INCOME TAXES		-			-			-			-
NET LOSS		(746,354	)		(514,440	)		(1,317,547	)		(770,322	)
OTHER COMPREHENSIVE INCOME (LOSS)
Translation Adjustment		(82,495	)		(58,402	)		(149,173	)		(36,175	)
COMPREHENSIVE LOSS	$	(828,849	)	$	(572,842	)	$	(1,168,374	)	$	(806,497	)
NET LOSS PER COMMON SHARE (Basic and diluted)	$	(0.02	)	$	(0.01	)	$	(0.03	)	$	(0.02	)
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING –
Basic and diluted		44,397,297			44,397,297			44,397,297			44,397,297

See accompanying notes to consolidated financial statements.

F-3

CHINA GINSENG HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

	For the Six Months Ended
	December 31,
	2014			2013
Cash Flows from Operating Activities:
Net loss	$	(1,317,547	)	$	(770,322	)
Adjustments to reconcile net loss to net cash from operating activities:
Depreciation and amortization		45,934			61,166
Imputed interest		48,186			42,801
Changes in assets and liabilities:
(Increase) decrease in accounts receivable		54,165			(796,201	)
(Increase) decrease in inventory		(141,631	)		695,290
(Increase) decrease in prepaid expense		(407	)		(44,690	)
(Increase) decrease in due from related parties		(16,826	)		6,364
Increase (decrease) in accounts payable		458,351			927,731
Increase (decrease) in taxes payable		(280	)		10,122
Increase (decrease) in receivables in advance		1,446			(1,156	)
Increase (decrease) in accrued expenses		344,218			242,785
Net cash provided by (used in) operating activities		(524,391	)		373,890
Cash Flows from Investing Activities:
Purchase of property and equipment		(3,479	)		-
Deposit on property and equipment		-			(6,164,805	)
Net cash provided by (used in) investing activities		(3,479	)		(6,164,805	)
Cash Flows from Financing Activities:
Proceeds from loans		343,565			6,065,932
Proceeds from loans payable to related parties		138,345			-
Repayment of loans payable to related parties		-			(58,278	)
Net cash provided by (used in) financing activities		481,910			6,007,654
Effect of exchange rate on cash		153,393			(93,224	)
Increase (decrease) in cash		107,433			123,515
Cash at beginning of period		24,782			19,454
Cash at end of period	$	132,215		$	142,969

See accompanying notes to consolidated financial statements.

F-4

CHINA GINSENG HOLDINGS, INC. AND SUBSIDIARIES (CONTINUED)

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

	For the Six Months Ended
	December 31,
	2014		2013
Supplemental Disclosure of Cash Flow
Information:
Cash paid for:
Interest	$	-	$	-
Income taxes		-		-

See accompanying notes to consolidated financial statements.

F-5

CHINA GINSENG HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2014 (UNAUDITED)

NOTE A – PRESENTATION, NATURE OF BUSINESS, AND GOING CONCERN

Basis of Presentation

The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial statements.  Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. These consolidated financial statements should be read in conjunction with the Company’s annual report on Form 10-K for the year ended June 30, 2014.  In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary in order to make the consolidated financial statements not misleading have been included.  Results for the three months and six months ended December 31, 2014, are not necessarily indicative of the results that may be expected for the year ending June 30, 2015.

Nature of Business

China Ginseng Holdings, Inc. and Subsidiaries (the “Company”), was incorporated under the laws of Nevada on June 24, 2004.

On November 24, 2004, the Company acquired 55% of Yanbian Huaxing Ginseng Industry Co. Limited (“Yanbian Huaxing”), which is located in China and, is in the business of farming, processing, distribution, and marketing of Asian Ginseng products.  In 2010, the Company ceased marketing ginseng and is presently utilizing the harvest to produce a ginseng beverage.  However, it continues to buy ginseng for the resale market.  In August 2005, the Company acquired the remaining 45% of Yanbian Huaxing.

Yanbian Huaxing controls, through 20 year leases granted by the Chinese Government, approximately 1,500 hectares (3,705 acres) of land used to grow ginseng.  The Company had no operations prior to November 24, 2004. These leases expire through 2024. During the year ended June 30, 2014, the Forestry Bureau governing one of the farms approximating 700 hectare (1,730 acres) of land leased by Yanbian Huaxing notified the Company that this lease in no longer recognized. As a result, the Company is prevented from developing and planting ginseng in undeveloped areas of the farm.

On August 24, 2005, the Company acquired Jilin Ganzhi Ginseng Produce Co. Limited, whose principal business is the manufacture of ginseng drinks.

On October 19, 2005, the Company incorporated a new company, Jilin Huamei Beverage Co. Limited (“Jilin Huamei”).

On March 31, 2008, the Company acquired Tonghua Linyuan Grape Planting Co. Limited (“Tonghua Linyuan”) whose principal activity is the growing, cultivation and harvesting of a grape vineyard. The Company plans to produce wine and grape juice but to date has not commenced production. In June 2012, the Company decided to abandon the growing and harvesting of grapes due to the poor quality of recent harvests, which were not suitable for the production of wine or grape juice.  Instead, the Company began purchasing grapes in the open market to produce wine and grape juice and did not to renew the Leases with the Chinese Government when the leases expired on December 31, 2013, since it no longer needed them for its business. On June 30, 2013, the Company sold the assets and liabilities of Tonghua Linyuan to a third party.

On March 2, 2012, the Company approved the incorporation of a new subsidiary, Hong Kong Huaxia International Industrial Co., Limited (“Hong Kong Huaxia”) in Hong Kong in order to sell health and specialized local products. Hong Kong Huaxia was incorporated in Hong Kong on March 18, 2012, and began operations in April 2012. Hong Kong Huaxia has registered 880,000,000 shares of 1 HKD par value stock in Hong Kong. None of the $113,443,000 (880,000,000 HKD) registered capital of Hong Kong Huaxia has been funded.

F-6

CHINA GINSENG HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2014 (UNAUDITED)

NOTE A – PRESENTATION, NATURE OF BUSINESS, AND GOING CONCERN (CONTINUED)

Nature of Business (Continued)

On September 27, 2013, the Company established a new wholly owned subsidiary of Hong Kong Huaxia, Jilin Huaxia Ginseng Co., Ltd  (“Jilin Huaxia”) in order to open online store through Taobao Marketplace, the biggest online Business to Consumer and Consumer to Consumer platform in Asia, a subsidiary company of Alibaba Group, and to acquire machinery and equipment in China.  Hong Kong Huaxia registered capital of $6,000,000 in Jilin Huaxia.

Substantially all of the Company’s operations are in the People’s Republic of China and Hong Kong.

Consolidated Financial Statements

The consolidated financial statements include the accounts and activities of China Ginseng Holdings, Inc. and its wholly-owned subsidiaries, Yanbian Huaxing Ginseng Co. Limited, Jilin Huamei Beverage Co. Limited, Jilin Ganzhi Ginseng Products Co. Limited, Tonghua Linyuan Grape Planting Co. Limited and Hong Kong Huaxia International Industrial, Co. Limited (which included Jilin Huaxia Ginseng Co., Ltd). All intercompany transactions have been eliminated in consolidation.

Going Concern

As indicated in the accompanying financial statements, the Company had net losses of $1,317,547 and $770,322 for the six months ended December 31, 2014 and 2013, respectively, and an accumulated deficit of $15,486,882 as of December 31, 2014 and there are existing uncertain conditions the Company foresees relating to its ability to obtain working capital and operate successfully. Management’s plans include the raising of capital through the debt and equity markets to fund future operations and the generating of revenue through its businesses. Failure to raise adequate capital and generate adequate sales revenues could result in the Company having to curtail or cease operations.

Additionally, even if the Company does raise sufficient capital to support its operating expenses and generate adequate revenues, there can be no assurances that the revenues will be sufficient to enable it to develop business to a level where it will generate profits and cash flows from operations.  These matters raise substantial doubt about the Company’s ability to continue as a going concern.  However, the accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business.  These consolidated financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should the Company be unable to continue as a going concern.

F-7

CHINA GINSENG HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2014 (UNAUDITED)

NOTE B - PROPERTY AND EQUIPMENT

Property and equipment is comprised of the following at:

	December 31,			June 30,
	2014			2014
Buildings and improvements	$	1,470,828		$	1,462,749
Machinery and equipment		393,794			388,159
Motor vehicles		30,474			30,307
Office equipment		25,186			25,092
		1,920,282			1,906,307
Less accumulated depreciation		(492,310	)		(447,749	)
	$	1,427,972		$	1,458,558

Substantially all of the property and equipment is located in China.

Total Depreciation was $41,939 and $56,748 for the six months ended December 31, 2014 and 2013, respectively. Depreciation is recorded in the financial statements as follows:

	Six Months Ended
	December 31,
	2014		2013
Depreciation Expense	$	41,338	$	56,353
Capitalized Inventories and Ginseng Crops		601		395
	$	41,939	$	56,748

Depreciation expense is included within Deprecation and amortization on the consolidated Statements of Operations and Comprehensive Loss.  Capitalized Ginseng Crops is included in the consolidated Balance Sheet in this report.

NOTE C –DEPOSIT FOR EQUIPMENT PURCHASE

In November of 2013, the Company made a deposit of $5,962,214 (RMB 36,474,054) with a supplier for the purchase of equipment for the Companies ginseng farms. Prior to delivery of the equipment, the Company determined that this equipment was not best suited for its’ farms and cancelled the purchase. The deposit remains on hand with the supplier. The Company and supplier are negotiating for the delivery of different equipment.

F-8

CHINA GINSENG HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2014 (UNAUDITED)

NOTE D –INVENTORY

Inventory is comprised of the following at:

	December 31,		June 30,
	2014		2014
Raw materials	$	213,512	$	226,130
Finished goods		137,431		2,911
Operating supplies		4,395		4,371
	$	355,338	$	233,412

At December 31, 2014 and June 30, 2014, there were no shipments of Ginseng at customer locations awaiting inspection and approval that may be subject to invoicing.

NOTE E – INVESTMENT

In December 2010, the Company invested $24,868 (RMB 153,000) in Changchun Zhongshen Beverage Co. Ltd. (“Zhongshen”). This investment represented a 17% interest in Zhonghsen. Zhongshen is a retailer of ginseng juice and wine. The Company accounts for this investment utilizing the cost method. During the year ended June 30, 2014, the Company determined this investment was impaired as Zhonghsen ceased operations. As such, the Company recorded an impairment loss of $24,905 for the year ended June 30, 2014.

NOTE F – GINSENG CROPS

The Company’s business, prior to June 30, 2009, was primarily to harvest and sell fresh and dried ginseng. The growth period takes approximately 5 to 6 years before harvest can commence and up to 8 years for improved harvest and seedling yields. The Company is changing its business model to utilize the harvested ginseng to manufacture ginseng juice and other ginseng beverages. It commenced the juice operation in August 2011. The Company plants selected areas each year and tracks the costs expended each year by planting area. The Chinese government owns all of the land in China.

Currently, the Company has obtained leases from the Chinese government for approximately 1,500 hectare of land (approximately 3,705 acres) to grow ginseng, which were awarded in April and May 2005.  These leases are for 20 years and the management of the Company believes that the leases will be renewed as they expire in different areas.  However, there are no assurances that the Chinese government will continue to renew these leases in the future. The planting of new ginseng is dependent upon the Company’s cash flow and its ability to raise working capital. During the year ended June 30, 2014, the Forestry Bureau governing one of the farms approximating 700 hectare (1,730 acres) of land leased by Yanbian Huaxing notified the Company that this lease in no longer recognized. As a result, the Company is prevented from developing and planting ginseng in undeveloped areas of the farm.

The Company had planted approximately 287,984 square meters of land. The Company plans to plant, over the next 5 years, 100,000 square meters, representing approximately 20,000 square meters per year. The Company plans on harvesting the existing 2,664 square meters of ginseng in 2017.

F-9

CHINA GINSENG HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2014 (UNAUDITED)

NOTE F – GINSENG CROPS (CONTINUED)

An analysis of ginseng crop costs for each of the applicable periods is as follows:

	December 31, 2014		June 30, 2014
Beginning Crop Costs	$	6,721	$	681,967
Currency Conversion Adjustment to Beginning Balance		-		-
Capitalized Costs During Year:
Wages		-		21,162
Fertilizer		-		-
Ginseng shelf		-		-
Field clearing and cultivation		-		-
Farmer lease fee net of management fee		-		-
Labor		17,469		-
Irrigation		-
Depreciation		601		996
Other		1,635		3,399
Total Capitalized Costs		19,705		25,557
Less:
Cost of crops harvested		-		(700,803	)
Impairment adjustment		-		-
		-		(700,803	)
Ending Crop Costs		26,426		6,721
Less: Current portion		-		-
Non-Current Portion of Crop Costs	$	26,426	$	6,721

The cost of harvest is calculated by reference to the planting area and the detailed costs maintained for each planting area.  Based upon the square meters planted by area, a square meter cost is calculated and applied to the square meters harvested, rendering a cost of harvest.

For each financial reporting period, the Ginseng crop harvested is valued at net realizable value.  If the net realizable value is lower than carrying value, a write down is made for the difference.

NOTE G – AGREEMENTS WITH FARMERS

The Company has executed agreements with a number of local farmers to grow, cultivate and harvest ginseng utilizing the land leased from the government. The farming contracts commenced in January 2008. In connection with these agreements, the Company (1) leases sections of the ginseng farm land to the farmers at approximately $1.50 (RMB 10) per square meter per year, (2) provides the seeds and fertilizer to the farmers and clears the land of large debris, (3) pays the farmers a management fee of approximately $0.50 (RMB 4.00) per square meter per year, and (4) the farmers are required to produce 2kg of ginseng for each square meter that they manage. The Company pays the farmers the market price for their ginseng. If the harvest is below 2kg per square meter, the difference will be deducted from the total payment for ginseng purchased. If the harvest produces more that 2kg per square meter, the Company pays approximately $3.00 for every extra kilo. The Company records these agreements on a net basis by individual farmers. The Company has recorded a receivable from the farmers for the rental income of the leased ginseng farm land of $0 and $0 at December 31, 2014 and June 30, 2014, respectively. The Company has also recorded a long-term Payable to Farmers for the management fee due to the farmers.  The liability at December 31, 2014 and June 30, 2014 was $878,791 and $873,964, respectively. The receivable and payable balances for the respective areas will be settled at harvest time when the Company purchases the harvest at the current market value for ginseng.

F-10

CHINA GINSENG HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2014 (UNAUDITED)

NOTE H – INTANGIBLE ASSETS

Intangible assets consist of the patent rights for Ginseng drinks. The cost and related amortization is as follows:

	December 31,			June 30,
	2014			2014
Cost	$	21,687		$	18,261
Less accumulated amortization		(19,988	)		(15,286	)
	$	1,699		$	2,975

Amortization expense was $4,596 and $4,813 for the six months ended December 31, 2014 and 2013, respectively.

NOTE I – LOAN PAYABLE TO FINANCIAL INSTITUTION

In 2002, the Company’s subsidiary, Tonghua Linyuan, borrowed 2,000,000 RMB from Ji’an Qingshi Credit Corporation at an interest rate of 6.325% per annum with a maturity date of April 4, 2003. The loan is currently in default. In March 2008, the lender verbally agreed that no principal or interest need be paid until the company is generating profits. Interest has been paid on the loan through June 30, 2009 and has been accrued in subsequent periods. The loan is secured by the Company’s inventory and equipment. The loan balance at December 31, 2014 and June 30, 2014 was $326,851 and $325,055, respectively. The loan balance is included in Liabilities of Discontinued Operations on the accompanying consolidated Balance Sheet.

NOTE J – LOAN PAYABLE – BUILDING PURCHASE

On March 2, 2011, the Company entered into an agreement with Meihekou Hang Yilk Tax Warehousing Logistics, an auctioneer, to purchase office and warehouse facilities. The purchase price was $1,470,829 (RMB 9,000,000). On June 24, 2011, the Company made payment of $81,713 (RMB 500,000) leaving a balance of $1,307,403 (RMB 8,500,000). On September 10, 2011, the Company paid 8,000,000 RMB through the proceeds of a loan with Merkekou City Rural Credit Union. The loan was due on August 12, 2012. The interest rate is a floating rate adjusted upwards by 90%. At June 30, 2012, the Central Bank Rate was 6.31%. Applying the adjustment factor yields a rate of 11.989%. The loan is secured by the building. The remaining 500,000 RMB was paid as follows: (a) 100,000 RMB in December 2010 and (b) 400,000 RMB in June 2011. On August 30, 2012, the loan was renegotiated extending the maturity date to August 29, 2014 and requires principal payments of 1,000,000 RMB (USD 163,425) in September 2012; 1,000,000 RMB (USD 163,425) on August 29, 2013; 1,000,000 RMB (USD 163,425) on December 20, 2013 and 5,000,000 RMB (USD 817,128) on August 29, 2014. None of these payments were made by the Company and the note is thus in default.

NOTE K – LOAN PAYABLE – EQUIPMENT PURCHASE

On October 29, 2013, the Company borrowed $5,960,787 (RMB 36,474,054) in order to fund the acquisition of machinery and equipment by the Company. The loan term was to February 28, 2014, and the Company was to pay $211,489 (RMB 1,300,000) in interest over the life of the loan. The loan is secured by the assets of Jilin Huaxia. On March 3, 2014, the loan term was extended to June 30, 2014 and on September 3, 2014 the loan term was extended to June 30, 2015 in order to allow for the Company to receive the proceeds from the deposit made to purchase equipment. See Note C for corresponding deposit for equipment purchase.

F-11

CHINA GINSENG HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2014 (UNAUDITED)

NOTE L – LOAN PAYABLE – OTHER

The Company has loans with various individuals and finance companies totaling $2,327,784 (RMB 14,243,713) at December 31, 2014 and $1,984,219 (RMB 12,208,500) at June 30, 2014. These loans are payable on demand and bear interest at 3% per month.

NOTE M - RELATED PARTY TRANSACTIONS

The Company had been financing its operations with loans from individuals, principally residents of China, who are deemed to be related parties because of their ownership interest in the Company (shareholders).  The individuals have loaned the Company funds that are interest free, have no specific repayment date, and are unsecured.  The funds received are evidenced by receipt of cash acknowledgments.  As of December 31, 2014 and June 30 2014 funds borrowed to fund the current operations of the Company were $1,527,469 and $1,389,124, respectively.  In accordance with FASB ASC 835-30, the Company has imputed an interest charge of $48,186 and $42,801 which has been recorded in the financial statements for the six months ended December 31, 2014 and 2013, respectively.

As of December 31, 2014 and June 30, 2014, the Company had receivables from related parties amounting to $28,726 and $11,900, respectively.

NOTE N – PROVISION FOR INCOME TAXES

Deferred income taxes are determined using the liability method for the temporary differences between the financial reporting basis and income tax basis of the Company’s assets and liabilities. Deferred income taxes are measured based on the tax rates expected to be in effect when the temporary differences are included in the Company’s tax return. Deferred tax assets and liabilities are recognized based on anticipated future tax consequences attributable to differences between financial statement carrying amounts of assets and liabilities and their respective tax bases.

Deferred tax assets consist of the following at:

	December 31,			June 30,
	2014			2014
Timing difference related to inventory provisions	$	1,238		$	1,231
Net operating losses		2,896,638			2,567,252
Valuation allowance		(2,896,638	)		(2,567,252	)
Deferred tax asset	$	1,238		$	1,231

The deferred tax asset is the result of an inventory provision and related reserve. Under Chinese tax law, the Company is not entitled to a deduction for the provision until the inventory is completely discarded.  Accordingly, the liability has been recorded as an offset by a deferred tax asset representing a timing difference.

The Company has a net operating loss carry forward as follows:

	December 31,		June 30,
	2014		2014
International (China)	$	8,215,564	$	7,361,710
United States		3,370,989		2,907,296
	$	11,586,553	$	10,269,006

F-12

CHINA GINSENG HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2014 (UNAUDITED)

NOTE N – PROVISION FOR INCOME TAXES (CONTINUED)

The operating losses are available to offset future taxable income. The China net operating loss carryforwards can only be carried forward for five years and will commence expiring in the year 2013.  The Company does not file a consolidated tax return in China. Therefore, the profitability of the individual Chinese companies will determine the utilization of the carryforward losses. The U.S. carryforward losses are available to offset future taxable income for the succeeding 20 years and commence expiring in the year 2027.

The components of income before taxes are as follows:

	For the Six Months Ended December 31,
	2014			2013
International (China)	$	(853,854	)	$	(404,429	)
United States		(463,693	)		(365,893	)
	$	(1,317,547	)	$	(770,322	)

A reconciliation of the Company’s effective tax rate as a percentage of income before taxes and Federal statutory rate for the six months ended December 31, 2014 and 2013, respectively, are as follows:

	2014			2013
Federal statutory rate		(34.0	)%		(34.0	)%
State income taxes, net of federal benefit		3.3			3.3
Valuation allowance		30.7			30.7
Effective tax rate		-	%		-	%

NOTE O – CONCENTRATIONS

In the six months ended December 31, 2013, three customers accounted for 91% of revenues.

NOTE P – COMMITMENTS AND CONTINGENCIES

The Company has employment agreements with various individuals in China. The following summarizes the contractual commitments under these agreements:

December 31,	Commitment
2015	$	50,583
2016		41,510
2017		3,432
	$	95,525

F-13

CHINA GINSENG HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2014 (UNAUDITED)

NOTE P – COMMITMENTS AND CONTINGENCIES (CONTINUED)

The Company has one year leases for its corporate offices in China with a minimum lease commitment of 202,768 RMB (USD $33,137) which expires on or prior to December 31, 2015.

The Chinese government owns all the land in China. Currently, the Company has grants from the Chinese government for approximately 1,500 hectare of land (3,705 acres) to grow Ginseng. These grants are for 20 years. There is no assurance that the Chinese government will continue to renew these grants in the future. During the year ended June 30, 2014, the Forestry Bureau governing one of the farms approximating 700 hectare (1,730 acres) of land leased by Yanbian Huaxing notified the Company that this lease in no longer recognized. As a result, the Company is prevented from developing and planting ginseng in undeveloped areas of the farm.

The Company had a 15 year lease with the Representative of Group One Farmer, Si’An City, Qingshi, Qingshi Town, Qingshi Village, China to lease 750 acres to grow and harvest grapes. The lease expires December 31, 2014. The annual lease fee is 187,500 RMB or approximately $29,600 per year to lease the acreage. The land and buildings on the premises have a separate lease concurrent with the property lease. The Company sold this lease as part of the sale of the assets of Tonghua Linyuan

The Company has a lease to refrigerate and store fresh Ginseng, which is valid until terminated by the parties. The annual lease fee approximates $8,776 per year.

NOTE Q – OPERATING SEGMENTS

The Company presently organizes its business into three reportable segments: (1) the cultivation and harvest of Ginseng for the production of Ginseng beverages, (2) the cultivation and harvest of grapes for the eventual production of wine and grape juice and (3) the retail sales of cosmetics and health supplements.

The Company’s reportable business segments are strategic business units that offer different products.  Each segment is managed separately because they require different production techniques and market to different classes of customers.

During the six months ended December 31, 2014, the Company began presenting Cosmetics/ Supplements as a separate segment. This segment was previously included within the Ginseng segment. The Company has restated the below segment disclosure for the six months ended December 31, 2013 to be consistent with the 2014 presentation.

Six months ended December 31, 2014:

	Parent Company			Ginseng			Wine		Cosmetics/ Supplements			Total
Revenues	$	-		$	-		$	-	$	152,214		$	152,214
Net loss		(463,693	)		(836,261	)		-		(17,593	)		(1,317,547	)
Total assets		19,197			8,684,608			-		329,516			9,033,321
Other significant items:
Depreciation and amortization		642			44,893			-		399			45,934
Interest expense		25,344			506,864			-		1,024			533,232
Expenditures for fixed assets		1,039			2,440			-		-			3,479

F-14

CHINA GINSENG HOLDINGS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2014 (UNAUDITED)

NOTE Q – OPERATING SEGMENTS (Continued)

Six months ended December 31, 2013:

	Parent Company			Ginseng			Wine		Cosmetics/ Supplements			Total
Revenues	$	-		$	2,478,457		$	-	$	68,368		$	2,546,825
Net loss		(365,893	)		(254,530	)		-		(149,899	)		(770,322	)
Total assets		365,451			11,402,624			-		88,196			11,856,271
Other significant items:
Depreciation and amortization		861			60,305			-		-			61,166
Interest expense		22,462			260,024			-		109,747			392,233
Deposit on fixed assets		-			6,164,805			-		-			6,164,805

Three months ended December 31, 2014:

	Parent Company			Ginseng			Wine		Cosmetics/ Supplements		Total
Revenues	$	-		$	-		$	-	$	146,972	$	146,972
Net income (loss)		(233,764	)		(527,309	)		-		14,719		(746,354	)
Other significant items:
Depreciation and amortization		291			15,134			-		200		15,625
Interest expense		12,752			293,736			-		1,024		307,512
Expenditures for fixed assets		1,039			2,440			-		-		3,479

Three months ended December 31, 2013:

	Parent Company			Ginseng			Wine		Cosmetics/ Supplements			Total
Revenues	$	-		$	2,478,457		$	-	$	5,975		$	2,484,432
Net loss		(288,164	)		(99,296	)		-		(126,980	)		(514,440	)
Other significant items:
Depreciation and amortization		408			30,282			-		-			30,690
Interest expense		11,443			211,596			-		109,174			332,213
Deposit on fixed assets		-			6,164,805			-		-			6,164,805

F-15

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

This Form 10−Q contains forward-looking statements. Our actual results could differ materially from those set forth as a result of general economic conditions and changes in the assumptions used in making such forward-looking statements. The following discussion and analysis of financial condition and results of operations relates to the operations and financial condition reported in the financial statements of China Ginseng Holdings Inc. for the three and six months ended December 31, 2014 and 2013 and should be read in conjunction with such financial statements and related notes included in this report and the Company’s Annual Report on Form 10-K for the year ended June 30, 2014. The analysis set forth below is provided pursuant to applicable Securities and Exchange Commission regulations and is not intended to serve as a basis for projections of future events.

Company Overview

Our company, China Ginseng Holdings Inc., was incorporated on June 24, 2004 in the State of Nevada.   We have been granted 20 year land use rights to  3,705 acres of lands by the Chinese government for ginseng planting and we control through leases approximately 750 acres of grape vineyards.

During the year ended June 30, 2014, the Forest Bureau governing one of the farms approximating 700 hectare (1,730 acres) of land notified the Company that this lease is no longer recognized. As a result the Company is prevented from developing and planting ginseng in undeveloped areas of this farm.

Since our inception in 2004, we have been engaged in the business of farming, processing, distribution and marketing of fresh ginseng, dry ginseng, ginseng seeds, and seedlings.   Starting in August 2010, we have gradually shifted the focus of our business from direct sales of ginseng to canned ginseng juice and have started to store our raw material and sell limited self-produced ginseng. We also purchase ginseng from outside sources, and then resell them to generate revenue and those sales are based on the order from the market. However, due to the global recession and local market conditions, demand for ginseng exports declined beginning in 2008, creating a significant oversupply in China. All those factors caused us to have losses in recent years. In addition, market of ginseng products is very competitive; we need to spend capital to promote our new products, and develop our marketing plan. There is no assurance that there will be sufficient demand for our ginseng beverages to allow us to operate profitably, or at all. Our auditors have determined that we do not currently have sufficient working capital necessary and have raised substantial doubt about our ability to continue as a going concern. As of December 31, 2014, the cash balance on hand for the Company was about $132,215.

In order to meet the challenge, we are taking the following actions:

●

We raised capital to support our operation through a Regulation S private placement and plan to fund our operation through financings, bank loans and Letter of Credit Packing Loan, etc.; and

● ●

We plan to recruit distributors for ginseng beverage once funds are available and we intend to recruit one general distributor for ginseng juice in every city in which we sell our products. We plan to raise funds through equity or debt, whichever is available to us and open online shop at Taobao Marketplace, the biggest online Business to Consumer and Consumer to Consumer platform in Asia, a subsidiary company of Alibaba Group.

Although we did not have any production of or revenues from our ginseng beverage, we believe there is future potential to do so because (i) the China’s ginseng market is recovering now, and (ii) the demand and the price is in the uptrend due to Chinese government restrictions on the amount of land available for ginseng farming (land under our Company’s control was not affected by the government restrictions). Management is currently focusing on obtaining the financings so that the Company can open online store at Taobao Marketplace and move forward with our marketing plan. There is no assurance that we can successfully raise money at terms acceptable to us or at all.

Our Subsidiaries

Our business in China is currently mainly conducted through our wholly-owned subsidiaries: Yanbian Huaxia, Jilin Ganzhi, Jilin Huamei, Jilin Huaxia which are located in North China and Hong Kong Huaxia which is located in Hong Kong. Below is the operational status of each of these businesses as of the date of this filing:

● Yanbian Huaxing Ginseng Industry Co. Ltd. (“Yanbian Huaxing”) is a wholly foreign owned enterprise (“WFOE”) with a registered capital of $364,000. Yanbian Huaxing is operated to plant ginseng, and our revenue in the past was mainly from the sales of ginseng produced and sold by Yanbian Huaxing.  

● Jilin Ganzhi Ginseng Products Co. Ltd. (“Jilin Ganzhi”) is a WFOE with a registered capital of $100,000. It is operated to process ginseng and produce canned ginseng juice.

3

● Jilin Huamei Beverage Co. Ltd. (“Jilin Huamei”) is a WFOE with a registered capital of $200,000. It is operated to market our canned ginseng juice.

● Hong Kong Huaxia International Industrial Co., Ltd. (“Hong Kong Huaxia”) is our wholly-owned subsidiary with a registered capital of HKD 880,000,000 (approximately $113,443,000), which has not been funded by us. It is operated to sell health products and specialized local goods.

●  Jinlin Huaxia Ginseng Co., Ltd (“Jilin Huaxia”) is a wholly-owned subsidiary of Hong Kong Huaxia with a registered capital of $6,000,000. Jilin Huaxia was incorporated in September 2013 as a part of our market promoting strategy. We plan to open online stores through Taobao, the biggest online Business-to Consumer and Consumer-to-Consumer plaftform in Asia. Because Taobao only accepts stores with domestic business address, we established Jilin Huaxia to facilitate our expansion to B2C and C2C markets.

Our Products:

Previously, through Yanbian Huaxing, we focused on the farming, processing, distribution and marketing of Asian and American Ginseng and related byproducts in the following varieties:

● Fresh Ginseng:   For pharmaceutical, health supplement, cosmetic industry and fresh consumption.

● Dry Ginseng:   Dried form for pharmaceutical and, health supplement consumption.

● Ginseng Seeds:  Selling of ginseng seeds.

● Ginseng Seedling:  Selling of ginseng seedling.

Ginseng's growing season is from April to September, six months a year.  Normally we sow the seed in April and harvest in September. Ginseng seeds are obtained after the blossom in autumn, the seed can be sowed in September or next Spring, it takes 10 days to germinate and 10 days for seedling.  And the whole growing cycle for ginseng from seeding to harvest usually takes around 5-6 years to ensure the growth of ginseng and the nutrition it contains in the root. For ginseng, every hectare can harvest 18 to 20 kg ginseng. As of December 31, 2014, the planting area for ginseng is 287.984 square meter.

Since August 2010, we have gradually shifted our business focus from direct sale of ginseng and ginseng byproducts to production and sale of canned ginseng juice.

Through Jilin Ganzhi, we produce two types of canned ginseng juice.

● Ganzhi Asian Ginseng Beverage

● Ganzhi American Ginseng Beverage

New Focus of Our Business

Canned Ginseng Juice

Currently, there are about 10 kinds of ginseng drinks on the market; all of them are imported from Korea.  The price range for those products is 4 –30 RMB per can (about USD $0.60-$ 4.51).

The most important component of ginseng is ginsenoside. Based upon reading competitor labels, all of their ginseng drinks are produced by blending after extracting ginsenosides through chemical methods. The extraction for ginsenosides will cause damage to its nutritional components. Our technology is different from that traditional method used by our competitors.  We squeeze out the natural juice from fresh ginseng as the main material plus natural extracts like xylitol, citric acid and steviosides as subsidiary ingredients. We have farming technicians periodically inspect farmers to ensure they follow our growing guidelines to control the quality of the fresh ginseng.  We use low residue pesticide and biodegradable fertilizer for ginseng planting. And we use xylitol instead of sugar to lower calories.  Further, products made with xylitol do not cause a sour taste.

The reason direct squeezing is not commonly used in canned ginseng juice is that it needs fresh ginseng as a raw material and preservation of fresh ginseng is very difficult. However, our drink formula enables us to use refrigerated ginseng as raw material to produce canned ginseng juice and still able to preserve its freshness and nutrition in final products  The drink formula for our ginseng beverages is a registered patent approved by the Chinese government, patent number ZL 03111397.6.  This patent was issued on January 23, 2008 and expires 20 years after issuance.

4

In order to produce canned ginseng juice, we store our fresh ginseng in refrigerated warehouse space. We are currently renting a refrigerated warehouse (-20 C degree) to store all fresh ginseng inventory necessary for production of the ginseng beverages.   Monthly rent for refrigerated warehouse is RMB 4,500 (about USD $676.86). We commenced production in August 2010 and sales in October 2010. However, as we are in the initial stage of ginseng beverage business, we cannot assure the demands for our ginseng beverage will be high enough to make our business profitable in the short term and there is no guarantee that we will be able to generate the revenue from ginseng beverage business.

We own the production plant.  The plant is certified by the Chinese government as a Good Manufacturing Process facility, which is required for our production of these products.  Good Manufacturing Process standards cover organization and personnel, building and facilities, equipment, materials, hygiene and sanitation, validation, documentation, production management, quality management, production distribution and recall, complaints and adverse reactions report, and self-inspections.

Distribution

We intend to recruit one general distributor for our products of ginseng beverage and wine in every city in China.  The city level distributor can recruit the second level distributors.  In addition to recruiting general distributors, in some major cities, Jilin Huamei will establish sale branch offices to facilitate the local sales. Our direct sale will target at customers of high end retailers such as supermarkets, pharmacies, hotels, gift shops, entertainment centers, tourists attractions, airport and high speed trains, etc.

Furthermore, Hong Kong Huaxia was set up as a part of our adjusted marketing strategy so that we can explore the Asia Market through Hong Kong Huaxia while Jilin Huamei focuses on domestic sales.

Competitive environment

The market for ginseng products is highly competitive. Our operations may be affected by technological advances by competitors, industry consolidation, patents granted to competitors, competitive combination products, new products offered by our competitors, as well as new information provided by other marketed products and/or other post-market studies.

Discussion of Result of Operations

The following tables present certain consolidated statement of operations information. Financial information is presented for the three months and six months ended December 31, 2014 and 2013, respectively.

	For the Three Months Ended December 31,						Change
	2014			2013			Amount			%
Revenues	$	146,972			2,484,432			(2,337,460	)		-94	%
Cost of goods sold		112,917			2,070,925			(1,958,008	)		-95	%
Gross profit		34,055			413,507			(379,452	)		-92	%
Selling, general and administrative expenses		499,522			581,182			(81,660	)		-14	%
Bad Debt Expense (Recovered)		(42,250	)		(16,138	)		(26,112	)		162	%
Depreciation and amortization		15,625			30,690			(15,065	)		-49	%
Interest expense		307,512			332,213			(24,701	)		-7	%
Net Loss		(746,354	)		(514,440	)		(231,914	)		45	%

	For the Six Months Ended December 31,						Change
	2014			2013			Amount			%
Revenues	$	152,214			2,546,825			(2,394,611	)		-94	%
Cost of goods sold		115,818			2,077,579			(1,961,761	)		-94	%
Gross profit		36,396			469,246			(432,850	)		-92	%
Selling, general and administrative expenses		817,027			841,517			(24,490	)		-3	%
Bad Debt Expense  (Recovered)		(42,250	)		(55,348	)		13,098			-24	%
Depreciation and amortization		45,934			61,166			(15,232	)		-25	%
Interest expense		533,232			392,233			140,999			36	%
Net Loss		(1,317,547	)		(770,322	)		(547,225	)		71	%

5

Revenue

Our total revenue decreased from $2,484,432 to $146,972 for the three months ended December 31, 2014 and 2013, and from $2,546,825 to $152,214 for the six months ended December 31, 2014 and 2013; a decrease of 2,337,460 and 2,394,611, or 94% and 94%, respectively. The primary reason for the decrease was that we did not have any sales generated from ginseng and ginseng juice during the three months and six months ended December 31, 2014. During the three and six months ended December 31, 2014, we did not have sufficient capital to produce ginseng juice or harvest ginseng, and we did not take ginseng order from the market.

We only generated revenue of $146,972 and $152,214from sales by Hong Kong Huaxia, a wholly subsidiary of us in the three months and six months ended December 31, 2014, respectively. Hong Kong Huaxia sells health and specialized local products based on customer orders which vary from time to time.

We believe that we will be able to improve our sales through our online sales platform once we have enough capital to establish it. In order to improve our capital, we plan to raise funds through equity or debt, whichever is available to us. Meanwhile, we plan to search for appropriate business candidates for merger or acquisition to increase overall revenues of the Company through a diversification of products.

Cost of Goods Sold

Our total cost of goods sold decreased from $2,070,925 for the three months ended December 31, 2013 to $112,917 for the three months ended December 31, 2014, a decrease of 1,958,008 or 95%.

Our total cost of goods sold decreased from $2,077,579 for the six months ended December 31, 2013 to $115,818 for the six months ended December 31, 2014, a decrease of $1,961,761 or 94%.

The primary reason for the decrease was that we did not incur cost of goods sold in ginseng sales, including self-production, purchased ginseng for resale and ginseng beverage during the three months and six months ended December 31, 2014.

Our cost of goods sold is comprised of costs of different products purchased through HongKong Huaxia for resale, which were $112,917 and $115,818 for the three months and six months ended December 31, 2014.

Gross Profit

Gross profit was approximately $34,055 for the three months ended December 31, 2014 compared to $413,507 for the three months ended December 31, 2013, a decrease of $379,452 or 92%.

Gross profit was approximately $36,396 for the six months ended December 31, 2014, compared to $469,246 for the six months ended December 31, 2013, a decrease of $432,850 or 92%.

The decrease was primarily due to a decrease in the sales.

Selling, General and Administration Expenses

Selling, general expenses and administrative expenses decreased from $581,182 for the three months ended December 31, 2013 to $499,522 for the three months ended December 31, 2014, a decrease of $81,660, or 14%. 

Selling, general expenses and administrative expenses decreased from $841,517 for the six months ended December 31, 2013 to $817,027 for the six months ended December 31, 2014, a decrease of $24,490 or 3%. 

The decrease is mainly due to the decrease in our operation expense from Huaxing, such as salary for the workers who harvested ginseng and expense from Ganzhi, such as labor of production, etc.

Interest Expense

Our Interest expense decreased by $24,701, from $332,213 for the three months ended December 31, 2013 to $307,512 for the three months ended December 31, 2014, a decrease of 7%.

Our interest expense increased by $140,999 from $392,233 for the six months ended December 31, 2013 to $533,232 for the six months ended December 31, 2014, representing a 36% increase.  This increase was due to an increase in loan balances from the corresponding period in 2013.

6

Depreciation and amortization

Depreciation and amortization decreased by $15,065 from $30,690 for the three months ended December 31, 2013 to $15,625 for the three months ended December 31, 2014, a decrease of 49%.

Depreciation and amortization decreased by $15,232, from $61,166 for the six months ended December 31, 2013 to $45,934 for the six months ended December 31, 2014, a decrease of 25%.

This decrease is due to the depreciation on the $6,164,805 in new equipment purchased during the three and six months ended December 31, 2013.

Bad Debt Expense (Recovered)

Bad debt expense (recovered) increased by $26,112 from $16,138 for the three months ended December 31, 2013 to $42,250 for the three months ended December 31, 2014, an increase of 162%. The main reason is that our uncollected debt from Huaxing and Ganzhi increased during the three months ended December 31, 2104.

Bad debt expense (recovered) decreased by $13,098 from $55,348 for the six months ended December 31, 2013 to $42,250 for the six months ended December 31, 2014, a decrease of 24%. The main reason is that our uncollected debt from Huaxing and Ganzhi decreased during the six months ended December 31, 2104.

Net Loss

The Net Loss for the three months ended December 31, 2014 was $746,354; an increase of $231,914 or 45%, compared to a net loss of $514,440 for the three months ended December 31, 2013. The increase is primarily due to the decrease in revenues.

We had a net loss of $1,317,547 for the six months ended December 31, 2014 and a net loss of $770,322 for the six months ended December 31, 2013, an increase of $547,225, or 71 %.  The increase is primarily due to the decrease in revenues combined with an increase in interest expense in 2014.

Other Comprehensive Income

We operate primarily in the PRC and the functional currency of our operating subsidiary is the Chinese Renminbi (”RMB”).  The RMB is not freely convertible into foreign currency and all foreign exchange transactions must take place through authorized institutions.  No representation is intended to imply that the Renminbi amounts could have been, or could be, converted, realized or settled into USD at the rate on December 31, 2014 or at any other rate.

The value of RMB against U.S. dollar may fluctuate and is affected by changes in political and economic conditions. Our revenues, costs and financial assets are mostly denominated in RMB while our reporting currency is the U.S. dollar. Accordingly, this may result in gains or losses from currency translation on our financial statements.

Translation adjustments resulting from this process amounted to $(82,495) and $(58,402) for the three months ended December 31, 2014 and 2013, respectively.  And we have comprehensive loss of $828,849 and $572,842 for the three months ended December 31, 2014 and 2013, respectively.  The assets and liabilities amounts with the exception of equity for the three months ended December 31, 2014 were translated at 6.1190 RMB to 1.00 USD as compared to 6.0969 RMB to 1.00 USD for the three months ended December 31, 2013. The equity accounts were stated at their historical rate. The average translation rates applied to the income statements accounts for the three months ended December 31, 2014 and 2013 were 6.1469 RMB and 6.1491 RMB, respectively.

Translation adjustments resulting from this process amounted to $149,173 and $(36,175) for the six months ended December 31, 2014 and 2013, respectively. And we have comprehensive loss of $1,168,374 and $806,497 for the six months ended December 31, 2014 and 2013, respectively. The assets and liabilities amounts with the exception of equity for the six months ended December 31, 2014 were translated at 6.1190 RMB to 1.00 USD as compared to at 6.0969 RMB to 1.00 USD for the six months ended December 31, 2013. The equity accounts were stated at their historical rate. The average translation rates applied to the income statements accounts for the six months ended December 31, 2014 and 2013 were 6.1469 RMB, 6.1491 RMB, respectively.

Discussion of Cash Flow

Cash flows results for the six months ended December 31, 2014 and the six months ended December 31, 2013 are summarized as follows:

	December 31, 2014			December 31, 2013
Net cash provided by (used in) operating activities	$	(524,391	)	$	373,890
Net cash provided by (used in) investing activities	$	(3,479	)	$	(6,164,805	)
Net cash provided by (used in) financing activities	$	481,910		$	6,007,654

7

Operating activities

Cash flows provided by (used in) operating activities amounted to $(524,391) for the six months ended December 31, 2014, compared to $373,890 for the same period of 2013. This change was primarily due to an increase in net losses of $1,317,547, in addition to an increase in inventory of $141,631. These amounts were offset by an increase in accounts payable of $458,351 and an increase in accrued expenses of $344,218.

The increase in accounts payable was due to online products purchase during the six months ended December 31, 2014. The increase in inventory was because that we purchased products for online sale during the six months ended December 31, 2014. The increase in accrued expenses was because of increased accrued interest.

Investing Activities

Cash flows used in investing activities amounted to $3,479 for the six months ended December 31, 2014 which consisted of purchase of two computers of $3,479.

Cash flows used in investing activities amounted to $6,164,805 for the six months ended December 31, 2013, which consisted of a deposit on the purchase of equipment of $6,164,805. During the six months ended December 31, 2013,  Hong Kong Huaxia borrowed a short term loan of $6,065,932 to invest in Jilin Huaxia so that Jilin Huaxia can use the funds to purchase  an irrigation system, a temperature control system, and two CNC machine tools for our operation use. The loan term was to February 28, 2014, which was extended to June 30, 2015, and secured by the assets of Jilin Huaxia.

Financing activities

Cash flows provided by financing activities in the six months ended December 31, 2014, was $481,910, and primarily consisted of proceeds of loans payable to related parties of $138,345 and proceeds from loans of $343,565.

Cash flows provided by financing activities for the six months ended December 31, 2013 was $6,007,654, primarily proceeds from a short term loan of $6,065,932, offset by repayment of loans payable to related parties of $58,278.

Liquidity and Capital Resources

Liquidity is the ability of a company to generate funds to support its current and future operations, satisfy its obligations and otherwise operate on an ongoing basis. We have historically financed our operations and capital expenditures through loans from related parties, including officers, directors and other shareholders of the Company and have raised capital through a Regulation S private placement as well. Our current activities are related to developing our new business strategy the sale of Ginseng juice.

As of December 31, 2014, there was no change in our loan payments compared with December 31, 2013 since the loans remained constant. As of December 31, 2014, we had an outstanding loan of 2,000,000 RMB (about $326,851) to Ji’An Qingshi Credit Cooperatives (“Ji’An Qingshi”). The principal terms of the loan are as follows:

1.      Type of Loan: Short Term Agriculture Loan

2.      Loan Purpose: Planting

3.      Loan Amount: Principal of 2,000,000 RMB (about USD $326,851) with an annual interest of 6.325%

4.      Loan Period: From February 4, 2002 to February 4, 2003; Repayment due date was February 4, 2003

5.      Security: The loan is secured by assets of Tonghua including 14 carbon-steel storage cans; 16 high-speed steel storage cans and 150 tons of grape juice

We have not paid any principal or interest of the loan; however, Ji’An Qingshi verbally agreed in March 2008 not to call the loan. The material terms for the verbal agreement are: No principal or interest payments are required to be made until the Company is generating profits and interest continues to accrue until we repay the loan. On June 27, 2013, the Company decided to dispose of the assets and liabilities of Tonghua Linyuan to a third party and plans to close Tonghua Linyuan. The Company has retained $513,306 in contingent liabilities of Tonghua Linyuan for the six months ended December 31, 2014.

8

On August 30, 2012, we refinanced the 8 million RMB bank loan which we obtained from Meihekou City Rural Credit Union on November 8, 2010 by a new loan of 8 million RMB (approximately USD $1,307,403) from the same lender. The principal terms of the new 8 million RMB bank loan agreements are as follows:

● Parties: Jilin Ganzhi Ginseng Products Co., Ltd (“Jilin Ganzhi”) and Meihekou City Rural Credit Union (“Meihekou Credit Union”);

● Meihekou Credit Union granted a loan of 8 million RMB (approximately USD $ 1,307,403) to Jilin Ganzhi to be used in calling in and refunding and the term of the loan is 24 months from August 30, 2012 to August 29, 2014.

● The loan carries a benchmark interest rate which is the rate announced by the People’s Bank of China as an interest rate of same type and class of loans at the date of the loan and changes with the adjustment of national bank rate. Meihekou Credit Union calculates the interest on a monthly basis applying this annual floating rate which is payable on the 21st day of each month. We paid interest of 94,127 RMB (about USD $14,838) on August 21, 2012. And from September, 2012 to June 30, 2013, we have not paid interest and we plan to pay all outstanding interest when we have sufficient cash. For the year ended June 30, 2014, we paid $154,635 in accrued interest.

● Repay the principal by installments according to the following repayment plan: principal payment of RMB1M (approximately USD $163,425) on September 20, 2012, RMB 1M (approximately USD $163,425) on August 29, 2013, RMB 1M (approximately USD $163,425) on December 20, 2013 and RMB 5M (approximately USD $817,128) on August 29, 2014. The payments due in September 2012, August 2013 and December 2013 were not made by the Company and the note is thus in default.

As of June 30, 2014, there was no change in our loan payments compared to December 31, 2014, since the loans remained constant. Since the lender, Ji’ An Qingshi Credit Cooperative has verbally agreed not to call the loan, we can repay this loan at our own discretion when funds are available. Thus, the debt in Tonghua Linyuan acquisition will not have an impact on our liquidity and capital resources before we start to repay the lander.

On October 29, 2013, the Company borrowed $5,960,787 (RMB 36,474,054) in order to fund the acquisition of machinery and equipment by the Company. The loan term was to February 28, 2014 and the Company paid $211,489 (RMB 1,300,000) in interest over the life of the loan. The loan is secured by the assets of Jilin Huaxia. On March 3, 2014, the due date of the loan was extended to June 30, 2014 and on September 3, 2014 the term of the loan was extended to June 30, 2015.

The Company has loans with various individuals and finance companies totaling $2,327,748 (RMB 12,208,500). These loans are payable on demand and bear interest at 3% per annum.

As of December 31, 2014 and 2013, we had notes payable of approximately $1,527,469 and $1,228,768 to related parties, respectively. These amounts are mainly due to the working capital demands of the business. Most of these related parties are our individual shareholders or immediate family members of our shareholders and friends of our shareholders. The individuals loaned us funds which are interest free with no specific repayment date and unsecured. The funds received are evidenced by receipt of cash acknowledgments.

As of December 31, 2014, we had no material commitments for capital expenditures other than for those expenditures incurred in the ordinary course of business. We plan to fund operations and capital expenditures with cash from operations, as well as loans from major shareholders and management members and their affiliates. We might also pursue additional financings in the form of debt, equity or convertible security offerings. There can be no assurance that we will be able to obtain such additional financing at acceptable terms to us, or at all.

Going Concern

As indicated in the accompanying financial statements, the Company had net losses of $1,317,547 and $770,332 for the six months ended December 31, 2014 and 2013, respectively, and an accumulated deficit of $15,486,882 at December 31, 2014, and there are existing uncertain conditions the Company foresees relating to its ability to obtain working capital and operate successfully. Management’s plans include the raising of capital through the debt and equity markets to fund future operations and the generation of revenue through its businesses. Failure to raise adequate capital and generate adequate sales revenue could result in the Company having to curtail or cease operations.

Additionally, even if the Company does raise sufficient capital to support its operating expenses and generate adequate revenues, there can be no assurances that the revenues will be sufficient to enable it to develop business to a level where it will generate profits and cash flows from operations. These matters raise substantial doubt about the Company’s ability to continue as a going concern. However, the accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. These consolidated financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should the Company be unable to continue as a going concern.

9

Item 3.  Quantitative and Qualitative Disclosure about Market Risk

Not applicable.

Item 4.  Controls and Procedures.

(a) Evaluation of disclosure controls and procedures

As of the end of our last fiscal year ended June 30, 2014, we carried out an evaluation, under the supervision and with the participation of management, including our chief executive officer and principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based upon that evaluation, management concluded that our disclosure controls and procedures were not effective as of June 30, 2014 to cause the information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods prescribed by SEC, and that such information is accumulated and communicated to management, including our chief executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.  Management conducted a similar evaluation as of the period covered by this Report and management again concluded that our disclosure controls and procedures were similarly ineffective as of December 31, 2014.

(b) Changes in internal control over financial reporting

Other than those disclosed in the Annual Report on Form 10K for the year ending June 30, 2013 that we continue to implement, there have not been any changes in our internal control over financial reporting identified in connection with the evaluation management performed at the end of the fiscal quarter covered by this Report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.

PART II — OTHER INFORMATION

Item 6.  Exhibits.

(a) Exhibits.

Exhibit No.	Document Description
10.1	LOAN EXTENSION AGREEMENT BETWEEN HONG KONG HUAXIA INTERNATIONAL INDUSTRIAL CO.,LTD.  AND FEI ZHANG
31.1	CERTIFICATION Of CEO PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002.
31.2	CERTIFICATION of CFO PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002.
32.1*	CERTIFICATION of CEO PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEYACT OF 2002.
32.2*	CERTIFICATION of CFO PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEYACT OF 2002.

*  This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 of the Securities Exchange Act of 1934, whether made before or after the date hereof and irrespective of any general incorporation language in any filings.

10

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 Ginseng Holdings, Inc.
Date: February 12, 2015	By:	/s/ Changzhen Liu
		Changzhen Liu
		Principal Executive Officer

Date: February 12, 2015	/s/ Ren Ying
	Ren Ying
	Principal Financial Officer and Principal Accounting Officer

11

EX-10.1

Exhibit 10.1 

协 议

甲方：香港华夏国际实业有限公司

法定代表人：刘长祯

护照号（身份证号）：220502195508150039

乙方：张飞

护照号（身份证号）：320830197612122075

因固定资产一直没有到位，本季度决定退回其固定资产，而购买资金尚未退回。经双方协商，乙方同意将6，000，000 美元的还款时间推迟到2015年6月30日。

甲方：香港华夏国际实业有限公司（盖章）

法人代表签字：

乙方：

二0一四年九月三日

Loan Contract

Party A: Hong Kong Huaxia International Industrial Co.,Ltd.

Legal Representative:Liu, Changzhen

ID number: 220502195508150039

Party B: Zhang, Fei

ID number: 320830197612122075

Considering fixed assets haven’t been put in the right place，we decided to return the fixed assets this quarter, but the purchase funds have not been returned yet. So Party B agreed to postpone the repayment of $ 6,000,000 to 30 June 2015 through consultations.

Party A: Hong Kong Huaxia International Industrial Co., Ltd.（Stamp）

Legal representative signature：

Party B: Zhang, Fei

Signature:

09-03-2014

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Changzhen Liu, certify that:

1. I have reviewed this report on Form 10-Q of China Ginseng 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 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 (the registrant’s fourth fiscal quarter in the case of an quarterly report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

	China Ginseng Holdings, Inc.
Dated: February 12, 2015	By:	/s/ Changzhen Liu
		Changzhen Liu
		Principal Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Ren Ying, certify that:

1. I have reviewed this report on Form 10-Q of China Ginseng 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 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 (the registrant’s fourth fiscal quarter in the case of an quarterly report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Dated: February 12, 2015	By:	/s/ Ren Ying
		Ren Ying
		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

Pursuant to 18 U.S.C. § 1350, as adopted pursuant to Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned hereby certifies that the Quarterly Report on Form 10-Q for the period ended December 31, 2014 of China Ginseng Holdings, Inc. (the “Company”) fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 and that the information contained in such Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

	China Ginseng Holdings, Inc.
Dated: February 12, 2015	By:	/s/  Changzhen Liu
		Changzhen Liu
		Principal Executive Officer

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to China Ginseng Holdings, Inc. and will be retained by China Ginseng Holdings, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

Pursuant to 18 U.S.C. § 1350, as adopted pursuant to Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned hereby certifies that the Quarterly Report on Form 10-Q for the period ended December 31, 2014 of China Ginseng Holdings, Inc. (the “Company”) fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 and that the information contained in such Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: February 12, 2015	By:	/s/ Ren Ying
		Ren Ying
		Principal Financial Officer and Principal Accounting Officer

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to China Ginseng Holdings, Inc. and will be retained by China Ginseng Holdings, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Agreements with Farmers (Details)	1 Months Ended
	Jan. 31, 2008 USD ($) kg	Jan. 31, 2008 CNY	Dec. 31, 2014 USD ($)	Jun. 30, 2014 USD ($)
Agreements with Farmers (Textual)
Per square meter price for leases of Ginseng land	$ 1.50	10
Management fee paid to farmers per square meter per year	0.50	4.00
Production of crop per square meter required in kg's	2	2
Payment condition of the harvested crop to the farmers	If the harvest is below 2kg per square meter, the difference will be deducted from the total payment for ginseng purchased. If the harvest produces more that 2kg per square meter, the Company pays approximately $3.00 for every extra kilo.	If the harvest is below 2kg per square meter, the difference will be deducted from the total payment for ginseng purchased. If the harvest produces more that 2kg per square meter, the Company pays approximately $3.00 for every extra kilo.
Price per kilo for extra kilo production	3
Long-term payable as a management fee due to the farmers			878,791	873,964
Receivable from the farmers for rental income			$ 0	$ 0

XML

Commitments and Contingencies (Details Textual)		6 Months Ended
	Jun. 30, 2014 Yanbian Huaxing [Member] acre ha	Dec. 31, 2014 Chinese Government [Member] ha acre	Dec. 31, 2014 Representative of group one farmer [Member] USD ($) acre	Dec. 31, 2014 Representative of group one farmer [Member] CNY acre	Dec. 31, 2014 Refrigeration and storage [Member] USD ($)	Dec. 31, 2014 Corporate Offices [Member] USD ($)	Dec. 31, 2014 Corporate Offices [Member] CNY
Commitments and Contingencies (Textual)
Expiration of leases			Dec. 31, 2014	Dec. 31, 2014		Dec. 31, 2015	Dec. 31, 2015
Term of Lease			15 years	15 years		1 year	1 year
Annual lease fee			$ 29,600	187,500	$ 8,776
Land used to grow ginseng (acres)	1,730	3,705	750	750
Commitments for the leases						$ 33,137	202,768
Land used to grow ginseng (hectare)	700	1,500
Grant period of lease		20 years

XML

Provision for Income Taxes (Details 1) (USD $)	Dec. 31, 2014	Jun. 30, 2014
Schedule of net operating loss carry forward
International (China)	$ 8,215,564	$ 7,361,710
United States	3,370,989	2,907,296
Net operating loss carry forward	$ 11,586,553	$ 10,269,006

XML

Operating Segments (Details) (USD $)	3 Months Ended		6 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2014	Dec. 31, 2013	Jun. 30, 2014
Summary of segments reporting information
Revenues	$ 146,972	$ 2,484,432	$ 152,214	$ 2,546,825
Net loss	(746,354)	(514,440)	(1,317,547)	(770,322)
Total assets	9,033,321	11,856,271	9,033,321	11,856,271	8,820,291
Other significant items:
Depreciation and amortization	15,625	30,690	45,934	61,166
Interest expense	307,512	332,213	533,232	392,233
Expenditures for fixed assets	3,479		3,479
Deposit on fixed assets		6,164,805		6,164,805
Parent Company [Member]
Summary of segments reporting information
Revenues
Net loss	(233,764)	(288,164)	(463,693)	(365,893)
Total assets	19,197	365,451	19,197	365,451
Other significant items:
Depreciation and amortization	291	408	642	861
Interest expense	12,752	11,443	25,344	22,462
Expenditures for fixed assets	1,039		1,039
Deposit on fixed assets
Ginseng [Member]
Summary of segments reporting information
Revenues		2,478,457		2,478,457
Net loss	(527,309)	(99,296)	(836,261)	(254,530)
Total assets	8,684,608	11,402,624	8,684,608	11,402,624
Other significant items:
Depreciation and amortization	15,134	30,282	44,893	60,305
Interest expense	293,736	211,596	506,864	260,024
Expenditures for fixed assets	2,440		2,440
Deposit on fixed assets		6,164,805		6,164,805
Wine [Member]
Summary of segments reporting information
Revenues
Net loss
Total assets
Other significant items:
Depreciation and amortization
Interest expense
Expenditures for fixed assets
Deposit on fixed assets
Cosmetics/ Supplements [Member]
Summary of segments reporting information
Revenues	146,972	5,975	152,214	68,368
Net loss	14,719	(126,980)	(17,593)	(149,899)
Total assets	329,516	88,196	329,516	88,196
Other significant items:
Depreciation and amortization	200		399
Interest expense	1,024	109,174	1,024	109,747
Expenditures for fixed assets
Deposit on fixed assets

XML

Related Party Transactions (Details) (USD $)	6 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Jun. 30, 2014
Related Party Transactions (Textual)
Notes payable - related parties	$ 1,527,469		$ 1,389,124
Imputed interest	48,186	42,801
Receivables from related parties	$ 28,726		$ 11,900

XML

Property and Equipment (Details Textual) (USD $)	6 Months Ended
	Dec. 31, 2014	Dec. 31, 2013
Property and Equipment (Textual)
Depreciation	$ 41,939	$ 56,748

XML

Ginseng Crops (Tables)

6 Months Ended

Dec. 31, 2014

Ginseng Crops [Abstract]

Schedule of analysis of ginseng crop costs

	December 31, 2014		June 30, 2014
Beginning Crop Costs	$	6,721	$	681,967
Currency Conversion Adjustment to Beginning Balance		-		-
Capitalized Costs During Year:
Wages		-		21,162
Fertilizer		-		-
Ginseng shelf		-		-
Field clearing and cultivation		-		-
Farmer lease fee net of management fee		-		-
Labor		17,469		-
Irrigation		-
Depreciation		601		996
Other		1,635		3,399
Total Capitalized Costs		19,705		25,557
Less:
Cost of crops harvested		-		(700,803	)
Impairment adjustment		-		-
		-		(700,803	)
Ending Crop Costs		26,426		6,721
Less: Current portion		-		-
Non-Current Portion of Crop Costs	$	26,426	$	6,721

XML

Provision for Income Taxes (Details 3)	6 Months Ended
	Dec. 31, 2014	Dec. 31, 2013
Schedule of effective tax rate reconciliation as a percentage of income before taxes and Federal statutory rate
Federal statutory rate	(34.00%)	(34.00%)
State income taxes, net of federal benefit	3.30%	3.30%
Valuation allowance	30.70%	30.70%
Effective tax rate

XML

Loan Payable to Financial Institution (Details)	0 Months Ended	1 Months Ended	6 Months Ended	12 Months Ended
	Sep. 10, 2011	Oct. 29, 2013	Dec. 31, 2014 USD ($)	Jun. 30, 2002 CNY	Jun. 30, 2014 USD ($)
Loan Payable to Financial Institution (Textual)
Loans payable				2,000,000
Interest rate on loan			3.00%	6.325%
Term of loan	Aug. 12, 2012	Feb. 28, 2014		Apr. 04, 2003
Debt instrument, interest payment terms			Interest has been paid on the loan through June 30, 2009 and has been accrued in subsequent periods.
Loan payable to financial institution			$ 326,851		$ 325,055

XML

Ginseng Crops (Details) (USD $)	6 Months Ended	12 Months Ended
	Dec. 31, 2014	Jun. 30, 2014
Schedule of analysis of ginseng crop costs
Beginning Crop Costs	$ 6,721	$ 681,967
Currency Conversion Adjustment to Beginning Balance
Capitalized Costs During Year:
Wages		21,162
Fertilizer
Field clearing and cultivation
Farmer lease fee net of management fee
Labor	17,469
Irrigation
Depreciation	601	996
Other	1,635	3,399
Total Capitalized Costs	19,705	25,557
Less:
Cost of crops harvested		(700,803)
Impairment adjustment
Capitalized costs net		(700,803)
Ending Crop Costs	26,426	6,721
Less: Current portion
Non-Current Portion of Crop Costs	$ 26,426	$ 6,721

XML

Concentrations (Details) (Revenue [Member])	6 Months Ended
	Dec. 31, 2014 Customers
Revenue [Member]
Concentrations (Textual)
Concentration risk, Percentage	91.00%
Number of customer	3

XML

Provision for Income Taxes (Details) (USD $)	Dec. 31, 2014	Jun. 30, 2014
Schedule of deferred tax assets
Timing difference related to inventory provisions	$ 1,238	$ 1,231
Net operating losses	2,896,638	2,567,252
Valuation allowance	(2,896,638)	(2,567,252)
Deferred tax asset	$ 1,238	$ 1,231

XML

Inventory

6 Months Ended

Dec. 31, 2014

Inventory [Abstract]

INVENTORY

NOTE D –INVENTORY

Inventory is comprised of the following at:

	December 31,		June 30,
	2014		2014
Raw materials	$	213,512	$	226,130
Finished goods		137,431		2,911
Operating supplies		4,395		4,371
	$	355,338	$	233,412

At December 31, 2014 and June 30, 2014, there were no shipments of Ginseng at customer locations awaiting inspection and approval that may be subject to invoicing.

XML

Loan Payable - Building Purchase (Details)	0 Months Ended	1 Months Ended			6 Months Ended		12 Months Ended
	Sep. 10, 2011 CNY	Oct. 29, 2013	Jun. 30, 2011 CNY	Dec. 31, 2010 CNY	Dec. 31, 2014 USD ($)	Dec. 31, 2014 CNY	Jun. 30, 2002	Jun. 30, 2012 CNY	Jun. 24, 2011 USD ($)	Jun. 24, 2011 CNY	Mar. 02, 2011 USD ($)	Mar. 02, 2011 CNY
Note Payable - Building Purchase (Textual)
Purchase price of office and warehouse facilities											$ 1,470,829	9,000,000
Amount paid for office and warehouse facilities	8,000,000								81,713	500,000
Unpaid amount for office and warehouse facilities									1,307,403	8,500,000
Loan maturity date	Aug. 12, 2012	Feb. 28, 2014					Apr. 04, 2003
Floating interest rate adjusted upwards description	Interest rate is a floating rate adjusted upwards by 90%.
Central bank rate								6.31%
Variable interest rate								11.989%
Remaining loan of office and warehouse facilities								500,000
Office and warehouse facilities purchase price paid			400,000	100,000
Office and warehouse loan to be repay in September 2012					163,425	1,000,000
Office and warehouse loan to be repay on August 29, 2013					163,425	1,000,000
Office and warehouse loan to be repay on December 20, 2013					163,425	1,000,000
Office and warehouse loan to be repay on August 29, 2014					$ 817,128	5,000,000

XML

Operating Segments (Tables)

6 Months Ended

Dec. 31, 2014

Operating Segments [Abstract]

Schedule of business segments

Six months ended December 31, 2014:

	Parent  Company			Ginseng			Wine		Cosmetics/ Supplements			Total
Revenues	$	-		$	-		$	-	$	152,214		$	152,214
Net loss		(463,693	)		(836,261	)		-		(17,593	)		(1,317,547	)
Total assets		19,197			8,684,608			-		329,516			9,033,321
Other significant items:
Depreciation and amortization		642			44,893			-		399			45,934
Interest expense		25,344			506,864			-		1,024			533,232
Expenditures for fixed assets		1,039			2,440			-		-			3,479

Six months ended December 31, 2013:

	Parent  Company			Ginseng			Wine		Cosmetics/ Supplements			Total
Revenues	$	-		$	2,478,457		$	-	$	68,368		$	2,546,825
Net loss		(365,893	)		(254,530	)		-		(149,899	)		(770,322	)
Total assets		365,451			11,402,624			-		88,196			11,856,271
Other significant items:
Depreciation and amortization		861			60,305			-		-			61,166
Interest expense		22,462			260,024			-		109,747			392,233
Deposit on fixed assets		-			6,164,805			-		-			6,164,805

Three months ended December 31, 2014:

	Parent  Company			Ginseng			Wine		Cosmetics/ Supplements		Total
Revenues	$	-		$	-		$	-	$	146,972	$	146,972
Net income (loss)		(233,764	)		(527,309	)		-		14,719		(746,354	)
Other significant items:
Depreciation and amortization		291			15,134			-		200		15,625
Interest expense		12,752			293,736			-		1,024		307,512
Expenditures for fixed assets		1,039			2,440			-		-		3,479

Three months ended December 31, 2013:

	Parent  Company			Ginseng			Wine		Cosmetics/ Supplements			Total
Revenues	$	-		$	2,478,457		$	-	$	5,975		$	2,484,432
Net loss		(288,164	)		(99,296	)		-		(126,980	)		(514,440	)
Other significant items:
Depreciation and amortization		408			30,282			-		-			30,690
Interest expense		11,443			211,596			-		109,174			332,213
Deposit on fixed assets		-			6,164,805			-		-			6,164,805

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Commitments and Contingencies (Tables)

6 Months Ended

Dec. 31, 2014

Commitments and Contingencies [Abstract]

Schedule of contractual commitments

December 31,	Commitment
2015	$	50,583
2016		41,510
2017		3,432
	$	95,525

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Loan Payable - Equipment Purchase (Details)	0 Months Ended	1 Months Ended		12 Months Ended
	Sep. 10, 2011	Oct. 29, 2013 USD ($)	Oct. 29, 2013 CNY	Jun. 30, 2002
Notes Payable Equipment Purchase (Textual)
Payments to acquire machinery and equipment		$ 5,960,787	36,474,054
Term of loan	Aug. 12, 2012	Feb. 28, 2014	Feb. 28, 2014	Apr. 04, 2003
Interest paid for loan		$ 211,489	1,300,000

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Presentation, Nature of Business and Going Concern (Details)	3 Months Ended		6 Months Ended			12 Months Ended
	Dec. 31, 2014 USD ($)	Dec. 31, 2013 USD ($)	Dec. 31, 2014 USD ($)	Dec. 31, 2013 USD ($)	Jun. 30, 2014 USD ($)	Jun. 30, 2014 Yanbian Huaxing [Member] acre ha	Aug. 31, 2005 Yanbian Huaxing [Member]	Nov. 24, 2004 Yanbian Huaxing [Member]	Dec. 31, 2014 Hong Kong Huaxia [Member] USD ($)	Dec. 31, 2014 Hong Kong Huaxia [Member] HKD	Sep. 27, 2013 Hong Kong Huaxia [Member] USD ($)
Organization, Consolidation and Presentation of Financial Statements (Textual)
Net loss	$ (746,354)	$ (514,440)	$ (1,317,547)	$ (770,322)
Percentage of ownership acquired by company								55.00%
Remaining percentage acquired by company							45.00%
Term of capital leases contingent by the Chinese Government						20 years
Land used to grow ginseng (hectare)						700
Land used to grow ginseng (acres)						1,730
Operating leases description						The Company had no operations prior to November 24, 2004.
Description of leases expiration period						2024
Registered Capital									113,443,000	880,000,000	6,000,000
Registered shares	50,000,000		50,000,000		50,000,000				880,000,000	880,000,000
Registered stock, par value									$ 1
Accumulated deficit	$ 15,486,882		$ 15,486,882		$ 14,169,335

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Property and Equipment (Details) (USD $)	Dec. 31, 2014	Jun. 30, 2014
Schedule of property and equipment
Property and equipment, gross	$ 1,920,282	$ 1,906,307
Less accumulated depreciation	(492,310)	(447,749)
Property and equipment, net	1,427,972	1,458,558
Buildings and improvements [Member]
Schedule of property and equipment
Property and equipment, gross	1,470,828	1,462,749
Machinery and equipment [Member]
Schedule of property and equipment
Property and equipment, gross	393,794	388,159
Motor vehicles [Member]
Schedule of property and equipment
Property and equipment, gross	30,474	30,307
Office equipment [Member]
Schedule of property and equipment
Property and equipment, gross	$ 25,186	$ 25,092

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Deposit for Equipment Purchase

6 Months Ended

Dec. 31, 2014

Deposit for Equipment Purchase [Abstract]

DEPOSIT FOR EQUIPMENT PURCHASE

NOTE C –DEPOSIT FOR EQUIPMENT PURCHASE

In November of 2013, the Company made a deposit of $5,962,214 (RMB 36,474,054) with a supplier for the purchase of equipment for the Companies ginseng farms. Prior to delivery of the equipment, the Company determined that this equipment was not best suited for its’ farms and cancelled the purchase. The deposit remains on hand with the supplier. The Company and supplier are negotiating for the delivery of different equipment.

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Property and Equipment (Details 1) (USD $)	6 Months Ended
	Dec. 31, 2014	Dec. 31, 2013
Schedule of depreciation for property and equipment
Depreciation Expense	$ 41,338	$ 56,353
Capitalized Inventories and Ginseng Crops	601	395
Depreciation	$ 41,939	$ 56,748

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Intangible Assets (Details) (USD $)	Dec. 31, 2014	Jun. 30, 2014
Schedule of cost and related amortization of Intangible assets
Less accumulated amortization	$ (19,988)	$ (15,286)
Patent rights [Member]
Schedule of cost and related amortization of Intangible assets
Cost	21,687	18,261
Less accumulated amortization	(19,988)	(15,286)
Intangible asset, net	$ 1,699	$ 2,975

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Commitments and Contingencies (Details) (USD $)	Dec. 31, 2014
Schedule of contractual commitments
2015	$ 50,583
2016	41,510
2017	3,432
Total	$ 95,525

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Consolidated Balance Sheets (USD $)	Dec. 31, 2014	Jun. 30, 2014
CURRENT ASSETS
Cash	$ 132,215	$ 24,782
Accounts receivable, net	1,023,341	1,077,506
Inventory	355,338	233,412
Due from related parties	28,726	11,900
Prepaid expenses	74,152	73,745
Total Current Assets	1,613,772	1,421,345
PROPERTY AND EQUIPMENT, net of accumulated depreciation of $492,310 and $447,749 at December 31 and June 30, 2014, respectively	1,427,972	1,458,558
OTHER ASSETS
Ginseng crops, non-current portion	26,426	6,721
Deposit on equipment	5,962,214	5,929,461
Intangible assets-patents, net of accumulated amortization of $19,988 and $15,286 at December 31, and June 30, 2014, respectively	1,699	2,975
Deferred income tax asset	1,238	1,231
Total Assets	9,033,321	8,820,291
CURRENT LIABILITIES
Loan payable- equipment purchase	5,960,787	5,928,042
Loan payable- building purchase	1,307,403	1,300,221
Loans payable- other	2,327,784	1,984,219
Notes payable - related parties	1,527,469	1,389,124
Accounts payable	2,226,504	1,768,153
Accrued expenses	678,590	334,372
Taxes payable	72,225	72,505
Payments received in advance	263,117	261,671
Total Current Liabilities	14,363,879	13,038,307
OTHER LIABILITIES
Liabilities of discontinued operations	513,306	510,487
Payable to farmers	878,791	873,964
Total Liabilities	15,755,976	14,422,758
STOCKHOLDERS' DEFICIT
Common Stock, $0.001 par value; 50,000,000 shares authorized; 44,397,297 shares issued and outstanding at December 31 and June 30, 2014, respectively	44,398	44,398
Additional paid-in capital	7,654,785	7,606,599
Accumulated deficit	(15,486,882)	(14,169,335)
Accumulated other comprehensive income	1,065,044	915,871
Total Stockholders' Deficit	(6,722,655)	(5,602,467)
Total Liabilities and Stockholders' Deficit	$ 9,033,321	$ 8,820,291

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Loan Payable - Other (Details)	Dec. 31, 2014 USD ($)	Dec. 31, 2014 CNY	Jun. 30, 2014 USD ($)	Jun. 30, 2014 CNY	Jun. 30, 2002
Debt Disclosure [Abstract]
Loan payable- building purchase	$ 2,327,784	14,243,713	$ 1,984,219	12,208,500
Interest rate	3.00%	3.00%			6.325%

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Presentation, Nature of Business and Going Concern

6 Months Ended

Dec. 31, 2014

Presentation, Nature of Business, And Going Concern [Abstract]

PRESENTATION, NATURE OF BUSINESS, AND GOING CONCERN

NOTE A – PRESENTATION, NATURE OF BUSINESS, AND GOING CONCERN

Basis of Presentation

The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial statements.  Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. These consolidated financial statements should be read in conjunction with the Company’s annual report on Form 10-K for the year ended June 30, 2014.  In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary in order to make the consolidated financial statements not misleading have been included.  Results for the three months and six months ended December 31, 2014, are not necessarily indicative of the results that may be expected for the year ending June 30, 2015.

Nature of Business

China Ginseng Holdings, Inc. and Subsidiaries (the “Company”), was incorporated under the laws of Nevada on June 24, 2004.

On November 24, 2004, the Company acquired 55% of Yanbian Huaxing Ginseng Industry Co. Limited (“Yanbian Huaxing”), which is located in China and, is in the business of farming, processing, distribution, and marketing of Asian Ginseng products.  In 2010, the Company ceased marketing ginseng and is presently utilizing the harvest to produce a ginseng beverage.  However, it continues to buy ginseng for the resale market.  In August 2005, the Company acquired the remaining 45% of Yanbian Huaxing.

Yanbian Huaxing controls, through 20 year leases granted by the Chinese Government, approximately 1,500 hectares (3,705 acres) of land used to grow ginseng.  The Company had no operations prior to November 24, 2004. These leases expire through 2024. During the year ended June 30, 2014, the Forestry Bureau governing one of the farms approximating 700 hectare (1,730 acres) of land leased by Yanbian Huaxing notified the Company that this lease in no longer recognized. As a result, the Company is prevented from developing and planting ginseng in undeveloped areas of the farm.

On August 24, 2005, the Company acquired Jilin Ganzhi Ginseng Produce Co. Limited, whose principal business is the manufacture of ginseng drinks.

On October 19, 2005, the Company incorporated a new company, Jilin Huamei Beverage Co. Limited (“Jilin Huamei”).

On March 31, 2008, the Company acquired Tonghua Linyuan Grape Planting Co. Limited (“Tonghua Linyuan”) whose principal activity is the growing, cultivation and harvesting of a grape vineyard. The Company plans to produce wine and grape juice but to date has not commenced production. In June 2012, the Company decided to abandon the growing and harvesting of grapes due to the poor quality of recent harvests, which were not suitable for the production of wine or grape juice.  Instead, the Company began purchasing grapes in the open market to produce wine and grape juice and did not to renew the Leases with the Chinese Government when the leases expired on December 31, 2013, since it no longer needed them for its business. On June 30, 2013, the Company sold the assets and liabilities of Tonghua Linyuan to a third party.

On March 2, 2012, the Company approved the incorporation of a new subsidiary, Hong Kong Huaxia International Industrial Co., Limited (“Hong Kong Huaxia”) in Hong Kong in order to sell health and specialized local products. Hong Kong Huaxia was incorporated in Hong Kong on March 18, 2012, and began operations in April 2012. Hong Kong Huaxia has registered 880,000,000 shares of 1 HKD par value stock in Hong Kong. None of the $113,443,000 (880,000,000 HKD) registered capital of Hong Kong Huaxia has been funded.

On September 27, 2013, the Company established a new wholly owned subsidiary of Hong Kong Huaxia, Jilin Huaxia Ginseng Co., Ltd  (“Jilin Huaxia”) in order to open online store through Taobao Marketplace, the biggest online Business to Consumer and Consumer to Consumer platform in Asia, a subsidiary company of Alibaba Group, and to acquire machinery and equipment in China.  Hong Kong Huaxia registered capital of $6,000,000 in Jilin Huaxia.

Substantially all of the Company’s operations are in the People’s Republic of China and Hong Kong.

Consolidated Financial Statements

The consolidated financial statements include the accounts and activities of China Ginseng Holdings, Inc. and its wholly-owned subsidiaries, Yanbian Huaxing Ginseng Co. Limited, Jilin Huamei Beverage Co. Limited, Jilin Ganzhi Ginseng Products Co. Limited, Tonghua Linyuan Grape Planting Co. Limited and Hong Kong Huaxia International Industrial, Co. Limited (which included Jilin Huaxia Ginseng Co., Ltd). All intercompany transactions have been eliminated in consolidation.

Going Concern

As indicated in the accompanying financial statements, the Company had net losses of $1,317,547 and $770,322 for the six months ended December 31, 2014 and 2013, respectively, and an accumulated deficit of $15,486,882 as of December 31, 2014 and there are existing uncertain conditions the Company foresees relating to its ability to obtain working capital and operate successfully. Management’s plans include the raising of capital through the debt and equity markets to fund future operations and the generating of revenue through its businesses. Failure to raise adequate capital and generate adequate sales revenues could result in the Company having to curtail or cease operations.

Additionally, even if the Company does raise sufficient capital to support its operating expenses and generate adequate revenues, there can be no assurances that the revenues will be sufficient to enable it to develop business to a level where it will generate profits and cash flows from operations.  These matters raise substantial doubt about the Company’s ability to continue as a going concern.  However, the accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business.  These consolidated financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should the Company be unable to continue as a going concern.

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Inventory (Details) (USD $)	Dec. 31, 2014	Jun. 30, 2014
Schedule of inventory
Raw materials	$ 213,512	$ 226,130
Finished goods	137,431	2,911
Operating supplies	4,395	4,371
Inventory, net	$ 355,338	$ 233,412

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Operating Segments

6 Months Ended

Dec. 31, 2014

Operating Segments [Abstract]

OPERATING SEGMENTS

NOTE Q – OPERATING SEGMENTS

The Company presently organizes its business into three reportable segments: (1) the cultivation and harvest of Ginseng for the production of Ginseng beverages, (2) the cultivation and harvest of grapes for the eventual production of wine and grape juice and (3) the retail sales of cosmetics and health supplements.

The Company’s reportable business segments are strategic business units that offer different products.  Each segment is managed separately because they require different production techniques and market to different classes of customers.

During the six months ended December 31, 2014, the Company began presenting Cosmetics/ Supplements as a separate segment. This segment was previously included within the Ginseng segment. The Company has restated the below segment disclosure for the six months ended December 31, 2013 to be consistent with the 2014 presentation.

Six months ended December 31, 2014:

	Parent  Company			Ginseng			Wine		Cosmetics/ Supplements			Total
Revenues	$	-		$	-		$	-	$	152,214		$	152,214
Net loss		(463,693	)		(836,261	)		-		(17,593	)		(1,317,547	)
Total assets		19,197			8,684,608			-		329,516			9,033,321
Other significant items:
Depreciation and amortization		642			44,893			-		399			45,934
Interest expense		25,344			506,864			-		1,024			533,232
Expenditures for fixed assets		1,039			2,440			-		-			3,479

Six months ended December 31, 2013:

	Parent  Company			Ginseng			Wine		Cosmetics/ Supplements			Total
Revenues	$	-		$	2,478,457		$	-	$	68,368		$	2,546,825
Net loss		(365,893	)		(254,530	)		-		(149,899	)		(770,322	)
Total assets		365,451			11,402,624			-		88,196			11,856,271
Other significant items:
Depreciation and amortization		861			60,305			-		-			61,166
Interest expense		22,462			260,024			-		109,747			392,233
Deposit on fixed assets		-			6,164,805			-		-			6,164,805

Three months ended December 31, 2014:

	Parent  Company			Ginseng			Wine		Cosmetics/ Supplements		Total
Revenues	$	-		$	-		$	-	$	146,972	$	146,972
Net income (loss)		(233,764	)		(527,309	)		-		14,719		(746,354	)
Other significant items:
Depreciation and amortization		291			15,134			-		200		15,625
Interest expense		12,752			293,736			-		1,024		307,512
Expenditures for fixed assets		1,039			2,440			-		-		3,479

Three months ended December 31, 2013:

	Parent  Company			Ginseng			Wine		Cosmetics/ Supplements			Total
Revenues	$	-		$	2,478,457		$	-	$	5,975		$	2,484,432
Net loss		(288,164	)		(99,296	)		-		(126,980	)		(514,440	)
Other significant items:
Depreciation and amortization		408			30,282			-		-			30,690
Interest expense		11,443			211,596			-		109,174			332,213
Deposit on fixed assets		-			6,164,805			-		-			6,164,805

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Investment (Details) (Changchun Zhongshen Beverage Co. Ltd. [Member])	1 Months Ended		12 Months Ended
	Dec. 31, 2010 USD ($)	Dec. 31, 2010 CNY	Jun. 30, 2014 USD ($)
Investment (Textual)
Amount invested in non-controlling companies	$ 24,868	153,000
Percentage of interest in non-controlling company	17.00%	17.00%
Investment Gain (Loss)			$ 24,905

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Inventory (Tables)

6 Months Ended

Dec. 31, 2014

Inventory [Abstract]

Schedule of inventory

	December 31,		June 30,
	2014		2014
Raw materials	$	213,512	$	226,130
Finished goods		137,431		2,911
Operating supplies		4,395		4,371
	$	355,338	$	233,412

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Property and Equipment

6 Months Ended

Dec. 31, 2014

Property and Equipment [Abstract]

PROPERTY AND EQUIPMENT

NOTE B - PROPERTY AND EQUIPMENT

Property and equipment is comprised of the following at:

	December 31,			June 30,
	2014			2014
Buildings and improvements	$	1,470,828		$	1,462,749
Machinery and equipment		393,794			388,159
Motor vehicles		30,474			30,307
Office equipment		25,186			25,092
		1,920,282			1,906,307
Less accumulated depreciation		(492,310	)		(447,749	)
	$	1,427,972		$	1,458,558

Substantially all of the property and equipment is located in China.

Total Depreciation was $41,939 and $56,748 for the six months ended December 31, 2014 and 2013, respectively. Depreciation is recorded in the financial statements as follows:

	Six Months Ended
	December 31,
	2014		2013
Depreciation Expense	$	41,338	$	56,353
Capitalized Inventories and Ginseng Crops		601		395
	$	41,939	$	56,748

Depreciation expense is included within Deprecation and amortization on the consolidated Statements of Operations and Comprehensive Loss.  Capitalized Ginseng Crops is included in the consolidated Balance Sheet in this report.

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Consolidated Balance Sheets (Parenthetical) (USD $)	Dec. 31, 2014	Jun. 30, 2014
Balance Sheets [Abstract]
Accumulated depreciation	$ 492,310	$ 447,749
Intangible assets-patents, net of accumulated amortization	$ 19,988	$ 15,286
Common Stock, par value	$ 0.001	$ 0.001
Common Stock, shares authorized	50,000,000	50,000,000
Common Stock, shares issued	44,397,297	44,397,297
Common Stock, shares outstanding	44,397,297	44,397,297

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Loan Payable - Other

6 Months Ended

Dec. 31, 2014

Debt Disclosure [Abstract]

LOAN PAYABLE - OTHER

NOTE L – LOAN PAYABLE – OTHER

The Company has loans with various individuals and finance companies totaling $2,327,784 (RMB 14,243,713) at December 31, 2014 and $1,984,219 (RMB 12,208,500) at June 30, 2014. These loans are payable on demand and bear interest at 3% per month.

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Document and Entity Information	6 Months Ended
	Dec. 31, 2014	Feb. 09, 2015
Document and Entity Information [Abstract]
Entity Registrant Name	China Ginseng Holdings Inc
Entity Central Index Key	0001338460
Amendment Flag	false
Current Fiscal Year End Date	--06-30
Document Type	10-Q
Document Period End Date	Dec. 31, 2014
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	Q2
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		44,397,297

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Related Party Transactions

6 Months Ended

Dec. 31, 2014

Related Party Transactions [Abstract]

RELATED PARTY TRANSACTIONS

NOTE M - RELATED PARTY TRANSACTIONS

The Company had been financing its operations with loans from individuals, principally residents of China, who are deemed to be related parties because of their ownership interest in the Company (shareholders).  The individuals have loaned the Company funds that are interest free, have no specific repayment date, and are unsecured.  The funds received are evidenced by receipt of cash acknowledgments.  As of December 31, 2014 and June 30 2014 funds borrowed to fund the current operations of the Company were $1,527,469 and $1,389,124, respectively.  In accordance with FASB ASC 835-30, the Company has imputed an interest charge of $48,186 and $42,801 which has been recorded in the financial statements for the six months ended December 31, 2014 and 2013, respectively.

As of December 31, 2014 and June 30, 2014, the Company had receivables from related parties amounting to $28,726 and $11,900, respectively.

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Consolidated Statements of Operations and Comprehensive Loss (Unaudited) (USD $)	3 Months Ended		6 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2014	Dec. 31, 2013
Statements Of Operations and Comprehensive Loss [Abstract]
REVENUES	$ 146,972	$ 2,484,432	$ 152,214	$ 2,546,825
COSTS AND EXPENSES
Cost of goods sold	112,917	2,070,925	115,818	2,077,579
Selling, general and administrative expenses	499,522	581,182	817,027	841,517
Bad debt expense (recovered)	(42,250)	(16,138)	(42,250)	(55,348)
Depreciation and amortization	15,625	30,690	45,934	61,166
Total Costs and Expenses	585,814	2,666,659	936,529	2,924,914
OTHER EXPENSE
Interest expense	307,512	332,213	533,232	392,233
Net Other Expense	307,512	332,213	533,232	392,233
LOSS BEFORE INCOME TAXES	(746,354)	(514,440)	(1,317,547)	(770,322)
PROVISION FOR INCOME TAXES
NET LOSS	(746,354)	(514,440)	(1,317,547)	(770,322)
OTHER COMPREHENSIVE INCOME (LOSS)
Translation Adjustment	(82,495)	(58,402)	(149,173)	(36,175)
COMPREHENSIVE LOSS	$ (828,849)	$ (572,842)	$ (1,168,374)	$ (806,497)
NET LOSS PER COMMON SHARE (Basic and diluted)	$ (0.02)	$ (0.01)	$ (0.03)	$ (0.02)
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING -
Basic and diluted	44,397,297	44,397,297	44,397,297	44,397,297

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Agreements with Farmers

6 Months Ended

Dec. 31, 2014

Agreements With Farmers [Abstract]

AGREEMENTS WITH FARMERS

NOTE G – AGREEMENTS WITH FARMERS

The Company has executed agreements with a number of local farmers to grow, cultivate and harvest ginseng utilizing the land leased from the government. The farming contracts commenced in January 2008. In connection with these agreements, the Company (1) leases sections of the ginseng farm land to the farmers at approximately $1.50 (RMB 10) per square meter per year, (2) provides the seeds and fertilizer to the farmers and clears the land of large debris, (3) pays the farmers a management fee of approximately $0.50 (RMB 4.00) per square meter per year, and (4) the farmers are required to produce 2kg of ginseng for each square meter that they manage. The Company pays the farmers the market price for their ginseng. If the harvest is below 2kg per square meter, the difference will be deducted from the total payment for ginseng purchased. If the harvest produces more that 2kg per square meter, the Company pays approximately $3.00 for every extra kilo. The Company records these agreements on a net basis by individual farmers. The Company has recorded a receivable from the farmers for the rental income of the leased ginseng farm land of $0 and $0 at December 31, 2014 and June 30, 2014, respectively. The Company has also recorded a long-term Payable to Farmers for the management fee due to the farmers.  The liability at December 31, 2014 and June 30, 2014 was $878,791 and $873,964, respectively. The receivable and payable balances for the respective areas will be settled at harvest time when the Company purchases the harvest at the current market value for ginseng.

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Ginseng Crops

6 Months Ended

Dec. 31, 2014

Ginseng Crops [Abstract]

GINSENG CROPS

NOTE F – GINSENG CROPS

The Company’s business, prior to June 30, 2009, was primarily to harvest and sell fresh and dried ginseng. The growth period takes approximately 5 to 6 years before harvest can commence and up to 8 years for improved harvest and seedling yields. The Company is changing its business model to utilize the harvested ginseng to manufacture ginseng juice and other ginseng beverages. It commenced the juice operation in August 2011. The Company plants selected areas each year and tracks the costs expended each year by planting area. The Chinese government owns all of the land in China.

Currently, the Company has obtained leases from the Chinese government for approximately 1,500 hectare of land (approximately 3,705 acres) to grow ginseng, which were awarded in April and May 2005.  These leases are for 20 years and the management of the Company believes that the leases will be renewed as they expire in different areas.  However, there are no assurances that the Chinese government will continue to renew these leases in the future. The planting of new ginseng is dependent upon the Company’s cash flow and its ability to raise working capital. During the year ended June 30, 2014, the Forestry Bureau governing one of the farms approximating 700 hectare (1,730 acres) of land leased by Yanbian Huaxing notified the Company that this lease in no longer recognized. As a result, the Company is prevented from developing and planting ginseng in undeveloped areas of the farm.

The Company had planted approximately 287,984 square meters of land. The Company plans to plant, over the next 5 years, 100,000 square meters, representing approximately 20,000 square meters per year. The Company plans on harvesting the existing 2,664 square meters of ginseng in 2017.

An analysis of ginseng crop costs for each of the applicable periods is as follows:

	December 31, 2014		June 30, 2014
Beginning Crop Costs	$	6,721	$	681,967
Currency Conversion Adjustment to Beginning Balance		-		-
Capitalized Costs During Year:
Wages		-		21,162
Fertilizer		-		-
Ginseng shelf		-		-
Field clearing and cultivation		-		-
Farmer lease fee net of management fee		-		-
Labor		17,469		-
Irrigation		-
Depreciation		601		996
Other		1,635		3,399
Total Capitalized Costs		19,705		25,557
Less:
Cost of crops harvested		-		(700,803	)
Impairment adjustment		-		-
		-		(700,803	)
Ending Crop Costs		26,426		6,721
Less: Current portion		-		-
Non-Current Portion of Crop Costs	$	26,426	$	6,721

The cost of harvest is calculated by reference to the planting area and the detailed costs maintained for each planting area.  Based upon the square meters planted by area, a square meter cost is calculated and applied to the square meters harvested, rendering a cost of harvest.

For each financial reporting period, the Ginseng crop harvested is valued at net realizable value.  If the net realizable value is lower than carrying value, a write down is made for the difference.

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Property and Equipment (Tables)

6 Months Ended

Dec. 31, 2014

Property and Equipment [Abstract]

Schedule of property and equipment

	December 31,			June 30,
	2014			2014
Buildings and improvements	$	1,470,828		$	1,462,749
Machinery and equipment		393,794			388,159
Motor vehicles		30,474			30,307
Office equipment		25,186			25,092
		1,920,282			1,906,307
Less accumulated depreciation		(492,310	)		(447,749	)
	$	1,427,972		$	1,458,558

Schedule of depreciation for property and equipment

	Six Months Ended
	December 31,
	2014		2013
Depreciation Expense	$	41,338	$	56,353
Capitalized Inventories and Ginseng Crops		601		395
	$	41,939	$	56,748

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Provision for Income Taxes

6 Months Ended

Dec. 31, 2014

Provision for Income Taxes [Abstract]

PROVISION FOR INCOME TAXES

NOTE N – PROVISION FOR INCOME TAXES

Deferred income taxes are determined using the liability method for the temporary differences between the financial reporting basis and income tax basis of the Company’s assets and liabilities. Deferred income taxes are measured based on the tax rates expected to be in effect when the temporary differences are included in the Company’s tax return. Deferred tax assets and liabilities are recognized based on anticipated future tax consequences attributable to differences between financial statement carrying amounts of assets and liabilities and their respective tax bases.

Deferred tax assets consist of the following at:

	December 31,			June 30,
	2014			2014
Timing difference related to inventory provisions	$	1,238		$	1,231
Net operating losses		2,896,638			2,567,252
Valuation allowance		(2,896,638	)		(2,567,252	)
Deferred tax asset	$	1,238		$	1,231

The deferred tax asset is the result of an inventory provision and related reserve. Under Chinese tax law, the Company is not entitled to a deduction for the provision until the inventory is completely discarded.  Accordingly, the liability has been recorded as an offset by a deferred tax asset representing a timing difference.

The Company has a net operating loss carry forward as follows:

	December 31,		June 30,
	2014		2014
International (China)	$	8,215,564	$	7,361,710
United States		3,370,989		2,907,296
	$	11,586,553	$	10,269,006

The operating losses are available to offset future taxable income. The China net operating loss carryforwards can only be carried forward for five years and will commence expiring in the year 2013.  The Company does not file a consolidated tax return in China. Therefore, the profitability of the individual Chinese companies will determine the utilization of the carryforward losses. The U.S. carryforward losses are available to offset future taxable income for the succeeding 20 years and commence expiring in the year 2027.

The components of income before taxes are as follows:

	For the Six Months Ended December 31,
	2014			2013
International (China)	$	(853,854	)	$	(404,429	)
United States		(463,693	)		(365,893	)
	$	(1,317,547	)	$	(770,322	)

A reconciliation of the Company’s effective tax rate as a percentage of income before taxes and Federal statutory rate for the six months ended December 31, 2014 and 2013, respectively, are as follows:

	2014			2013
Federal statutory rate		(34.0	)%		(34.0	)%
State income taxes, net of federal benefit		3.3			3.3
Valuation allowance		30.7			30.7
Effective tax rate		-	%		-	%

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Loan Payable - Building Purchase

6 Months Ended

Dec. 31, 2014

Debt Disclosure [Abstract]

LOAN PAYABLE - BUILDING PURCHASE

NOTE J – LOAN PAYABLE – BUILDING PURCHASE

On March 2, 2011, the Company entered into an agreement with Meihekou Hang Yilk Tax Warehousing Logistics, an auctioneer, to purchase office and warehouse facilities. The purchase price was $1,470,829 (RMB 9,000,000). On June 24, 2011, the Company made payment of $81,713 (RMB 500,000) leaving a balance of $1,307,403 (RMB 8,500,000). On September 10, 2011, the Company paid 8,000,000 RMB through the proceeds of a loan with Merkekou City Rural Credit Union. The loan was due on August 12, 2012. The interest rate is a floating rate adjusted upwards by 90%. At June 30, 2012, the Central Bank Rate was 6.31%. Applying the adjustment factor yields a rate of 11.989%. The loan is secured by the building. The remaining 500,000 RMB was paid as follows: (a) 100,000 RMB in December 2010 and (b) 400,000 RMB in June 2011. On August 30, 2012, the loan was renegotiated extending the maturity date to August 29, 2014 and requires principal payments of 1,000,000 RMB (USD 163,425) in September 2012; 1,000,000 RMB (USD 163,425) on August 29, 2013; 1,000,000 RMB (USD 163,425) on December 20, 2013 and 5,000,000 RMB (USD 817,128) on August 29, 2014. None of these payments were made by the Company and the note is thus in default.

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Intangible Assets

6 Months Ended

Dec. 31, 2014

Intangible Assets [Abstract]

INTANGIBLE ASSETS

NOTE H – INTANGIBLE ASSETS

Intangible assets consist of the patent rights for Ginseng drinks. The cost and related amortization is as follows:

	December 31,			June 30,
	2014			2014
Cost	$	21,687		$	18,261
Less accumulated amortization		(19,988	)		(15,286	)
	$	1,699		$	2,975

Amortization expense was $4,596 and $4,813 for the six months ended December 31, 2014 and 2013, respectively.

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Loan Payable to Financial Institution

6 Months Ended

Dec. 31, 2014

Debt Disclosure [Abstract]

LOAN PAYABLE TO FINANCIAL INSTITUTION

NOTE I – LOAN PAYABLE TO FINANCIAL INSTITUTION

In 2002, the Company’s subsidiary, Tonghua Linyuan, borrowed 2,000,000 RMB from Ji’an Qingshi Credit Corporation at an interest rate of 6.325% per annum with a maturity date of April 4, 2003. The loan is currently in default. In March 2008, the lender verbally agreed that no principal or interest need be paid until the company is generating profits. Interest has been paid on the loan through June 30, 2009 and has been accrued in subsequent periods. The loan is secured by the Company’s inventory and equipment. The loan balance at December 31, 2014 and June 30, 2014 was $326,851 and $325,055, respectively. The loan balance is included in Liabilities of Discontinued Operations on the accompanying consolidated Balance Sheet.

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Loan Payable - Equipment Purchase

6 Months Ended

Dec. 31, 2014

Debt Disclosure [Abstract]

LOAN PAYABLE - EQUIPMENT PURCHASE

NOTE K – LOAN PAYABLE – EQUIPMENT PURCHASE

On October 29, 2013, the Company borrowed $5,960,787 (RMB 36,474,054) in order to fund the acquisition of machinery and equipment by the Company. The loan term was to February 28, 2014, and the Company was to pay $211,489 (RMB 1,300,000) in interest over the life of the loan. The loan is secured by the assets of Jilin Huaxia. On March 3, 2014, the loan term was extended to June 30, 2014 and on September 3, 2014 the loan term was extended to June 30, 2015 in order to allow for the Company to receive the proceeds from the deposit made to purchase equipment. See Note C for corresponding deposit for equipment purchase.

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Deposit for Equipment Purchase (Details)	Nov. 30, 2013 USD ($)	Nov. 30, 2013 CNY
Deposit for Equipment Purchase (Textual)
Deposit Assets	$ 5,962,214	36,474,054

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Provision for Income Taxes (Details Textual)	6 Months Ended
	Dec. 31, 2014
China [Member]
Provision for Income Taxes (Textual)
Period to carry forward net operating losses	5 years
Operating loss expiration year	Jun. 30, 2013
U.S. [Member]
Provision for Income Taxes (Textual)
Period to carry forward net operating losses	20 years
Operating loss expiration year	Jun. 30, 2027

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Commitments and Contingencies

6 Months Ended

Dec. 31, 2014

Commitments and Contingencies [Abstract]

COMMITMENTS AND CONTINGENCIES

NOTE P – COMMITMENTS AND CONTINGENCIES

The Company has employment agreements with various individuals in China. The following summarizes the contractual commitments under these agreements:

December 31,	Commitment
2015	$	50,583
2016		41,510
2017		3,432
	$	95,525

The Company has one year leases for its corporate offices in China with a minimum lease commitment of 202,768 RMB (USD $33,137) which expires on or prior to December 31, 2015.

The Chinese government owns all the land in China. Currently, the Company has grants from the Chinese government for approximately 1,500 hectare of land (3,705 acres) to grow Ginseng. These grants are for 20 years. There is no assurance that the Chinese government will continue to renew these grants in the future. During the year ended June 30, 2014, the Forestry Bureau governing one of the farms approximating 700 hectare (1,730 acres) of land leased by Yanbian Huaxing notified the Company that this lease in no longer recognized. As a result, the Company is prevented from developing and planting ginseng in undeveloped areas of the farm.

The Company had a 15 year lease with the Representative of Group One Farmer, Si’An City, Qingshi, Qingshi Town, Qingshi Village, China to lease 750 acres to grow and harvest grapes. The lease expires December 31, 2014. The annual lease fee is 187,500 RMB or approximately $29,600 per year to lease the acreage. The land and buildings on the premises have a separate lease concurrent with the property lease. The Company sold this lease as part of the sale of the assets of Tonghua Linyuan

The Company has a lease to refrigerate and store fresh Ginseng, which is valid until terminated by the parties. The annual lease fee approximates $8,776 per year.

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Intangible Assets (Tables)

6 Months Ended

Dec. 31, 2014

Intangible Assets [Abstract]

Schedule of cost and related amortization of Intangible assets

	December 31,			June 30,
	2014			2014
Cost	$	21,687		$	18,261
Less accumulated amortization		(19,988	)		(15,286	)
	$	1,699		$	2,975

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Provision for Income Taxes (Details 2) (USD $)	6 Months Ended
	Dec. 31, 2014	Dec. 31, 2013
Schedule of components of income before taxes
International (China)	$ (853,854)	$ (404,429)
United States	(463,693)	(365,893)
Income before taxes	$ (1,317,547)	$ (770,322)

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Intangible Assets (Details Textual) (USD $)	6 Months Ended
	Dec. 31, 2014	Dec. 31, 2013
Intangible Assets (Textual)
Amortization expense of intangible assets	$ 4,596	$ 4,813

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Consolidated Statements of Cash Flows (Unaudited) (USD $)	6 Months Ended
	Dec. 31, 2014	Dec. 31, 2013
Cash Flows from Operating Activities:
Net loss	$ (1,317,547)	$ (770,322)
Adjustments to reconcile net loss to net cash from operating activities:
Depreciation and amortization	45,934	61,166
Imputed interest	48,186	42,801
Changes in assets and liabilities:
(Increase) decrease in accounts receivable	54,165	(796,201)
(Increase) decrease in inventory	(141,631)	695,290
(Increase) decrease in prepaid expense	(407)	(44,690)
(Increase) decrease in due from related parties	(16,826)	6,364
Increase (decrease) in accounts payable	458,351	927,731
Increase (decrease) in taxes payable	(280)	10,122
Increase (decrease) in receivables in advance	1,446	(1,156)
Increase (decrease) in accrued expenses	344,218	242,785
Net cash provided by (used in) operating activities	(524,391)	373,890
Cash Flows from Investing Activities:
Purchase of property and equipment	(3,479)
Deposit on property and equipment		(6,164,805)
Net cash provided by (used in) investing activities	(3,479)	(6,164,805)
Cash Flows from Financing Activities:
Proceeds from loans	343,565	6,065,932
Proceeds from loans payable to related parties	138,345
Repayment of loans payable to related parties		(58,278)
Net cash provided by (used in) financing activities	481,910	6,007,654
Effect of exchange rate on cash	153,393	(93,224)
Increase (decrease) in cash	107,433	123,515
Cash at beginning of period	24,782	19,454
Cash at end of period	132,215	142,969
Cash paid for:
Interest
Income taxes

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Investment

6 Months Ended

Dec. 31, 2014

Investment [Abstract]

INVESTMENT

NOTE E – INVESTMENT

In December 2010, the Company invested $24,868 (RMB 153,000) in Changchun Zhongshen Beverage Co. Ltd. (“Zhongshen”). This investment represented a 17% interest in Zhonghsen. Zhongshen is a retailer of ginseng juice and wine. The Company accounts for this investment utilizing the cost method. During the year ended June 30, 2014, the Company determined this investment was impaired as Zhonghsen ceased operations. As such, the Company recorded an impairment loss of $24,905 for the year ended June 30, 2014.

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Provision for Income Taxes (Tables)

6 Months Ended

Dec. 31, 2014

Provision for Income Taxes [Abstract]

Schedule of deferred tax assets

	December 31,			June 30,
	2014			2014
Timing difference related to inventory provisions	$	1,238		$	1,231
Net operating losses		2,896,638			2,567,252
Valuation allowance		(2,896,638	)		(2,567,252	)
Deferred tax asset	$	1,238		$	1,231

Schedule of net operating loss carry forward

	December 31,		June 30,
	2014		2014
International (China)	$	8,215,564	$	7,361,710
United States		3,370,989		2,907,296
	$	11,586,553	$	10,269,006

Schedule of components of income before taxes

	For the Six Months Ended December 31,
	2014			2013
International (China)	$	(853,854	)	$	(404,429	)
United States		(463,693	)		(365,893	)
	$	(1,317,547	)	$	(770,322	)

Schedule of effective tax rate reconciliation as a percentage of income before taxes and Federal statutory rate

	2014			2013
Federal statutory rate		(34.0	)%		(34.0	)%
State income taxes, net of federal benefit		3.3			3.3
Valuation allowance		30.7			30.7
Effective tax rate		-	%		-	%

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Ginseng Crops (Details Textual)	6 Months Ended
	Dec. 31, 2014 acre sqm ha
Ginseng Crops (Textual)
Growth period before harvest	5 to 6 years
Period for improved harvest and seedling yields	8 years
Land grants from the Chinese government (in hectare)	1,500
Land grants from the Chinese government (in acres)	3,705
Land leased by Yanbian Huaxing (in hectare)	700
Land leased by Yanbian Huaxing (in acres)	1,730
Period for land grants	20 years
Land planted (in square meters)	287,984
Estimated future period for planting land	5 years
Estimated future land to be planted (in square meters)	100,000
Estimated land to be planted per year (in square meters)	20,000
Land to be harvested for ginseng in succeeding five years (in square meters)	2,664

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Concentrations

6 Months Ended

Dec. 31, 2014

Concentrations [Abstract]

CONCENTRATIONS

NOTE O – CONCENTRATIONS

In the six months ended December 31, 2013, three customers accounted for 91% of revenues.