ACQUISITION OF SUBSIDIARIES

9 Months Ended

May 31, 2022

Business Combination and Asset Acquisition [Abstract]

ACQUISITION OF SUBSIDIARIES

3. ACQUISITION OF SUBSIDIARIES

On August 17, 2020, the Company, through its wholly-owned subsidiary JFB, acquired all of the issued and outstanding capital stock (the “Acquisition”) of NPI, pursuant to the terms and conditions of that certain Stock Purchase Agreement, dated as of August 17, 2020, among the Company, JFB, NPI, the selling shareholders of NPI identified therein (each a “Seller,” and, collectively, the “Sellers”) and the representative of the Sellers identified therein.

The aggregate purchase price for the Acquisition was $4,850,000, less certain discounts, expenses and reductions for outstanding NPI debt owed to the Company and/or its affiliates, resulting in a net purchase price of $3,506,042, payable in 8,415,111 shares of the Company’s common stock to the Sellers in accordance with their respective pro rata percentage.

After the completion of the Acquisition, NPI became an indirect wholly owned subsidiary of the Company.

The Company completed the valuations necessary to assess the fair values of the tangible and intangible assets acquired and liabilities assumed, resulting from which the amount of Goodwill was determined and recognized as of the respective acquisition date. The following table summarizes the estimated aggregate fair values of the assets acquired and liabilities assumed as of the closing date, August 31, 2020.

Cash and cash equivalents	$	185,117
Prepayments, deposits and other receivables		145,228
Due from a shareholder		34,048
Right-of-use operating lease assets		113,590
Plant and equipment, net		30,365
Intangible assets- Technical know-hows		818,200
Goodwill		2,974,364
Other payables and accrued liabilities		(383,087	)
Contract liabilities		(2,896	)
Due to shareholders		(99,730	)
Operating lease liability		(113,646	)
Tax payable		(31,871	)
Deferred tax liabilities		(163,640	)
Net purchase price	$	3,506,042
Less: Outstanding NPI debt owed to the Company
Accounts receivable		989,854
Notes payable		(3,066,617	)
	$	1,429,279

The transaction resulted in a purchase price allocation of $2,974,364 to Goodwill, representing the financial, strategic and operational value of the transaction to the Company. Goodwill is attributed to the premium that the Company paid to obtain the value of the business of NPI and the synergies expected from the combined operations of NPI and the Company, the assembled workforce and their knowledge and experience in provision of products and projects utilizing NPI’s technical know-hows. The total amount of the Goodwill acquired is not deductible for tax purposes.

The balances of the Goodwill as of May 31, 2022 and August 31, 2021 are as follows

	As of May 31, 2022		As of August 31, 2021
Balance of Goodwill	$	1,747,945	$	1,747,945

The Company performed Goodwill impairment test at the reporting unit level on an annual basis and between annual tests when an event occurs or circumstances change indicating the asset might be impaired. No impairment loss of Goodwill of the reporting unit of the Fintech App development was recognized for the nine and three months ended May 31, 2022 and 2021.