10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

þQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2020

or

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

For the transition period from_____________ to____________

Commission File Number: 0-56168

ORGANIC AGRICULTURAL COMPANY LIMITED 

 (Exact name of registrant as specified in its charter)

Nevada	82-5442097
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification Number)

6th Floor A, Chuangxin Yilu,

No. 2305, Technology Chuangxincheng,

Gaoxin Jishu Chanye Technology Development District,

Harbin City. Heilongjiang Province.

China 150090

Office: +86 (0451) 5862-8171

(Address, including zip code, and telephone number, including area code,

of Registrant’s principal executive offices)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	Trading Symbol	Name of Each Exchange on Which Registered
None	None	Not Applicable

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

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files).    Yes þ No ☐

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

Large accelerated filer ☐	Accelerated filer ☐
Non-accelerated filer   ☐	Smaller reporting company þ
	Emerging growth company þ

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

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

APPLICABLE ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY

 PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.  Yes ☐ No☐

(APPLICABLE ONLY TO CORPORATE REGISTRANTS)

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

As of the date of filing of this report, there were outstanding 11,724,836 shares of the issuer’s common stock, par value $0.001 per share.

TABLE OF CONTENTS

		Page
	PART I—FINANCIAL INFORMATION
Item 1	Financial Statements.	F-1 – F-17
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	1
Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	3
Item 4.	Controls and Procedures.	3
	PART II—OTHER INFORMATION
Item 1.	Legal Proceedings.	4
Item 1A.	Risk Factors	4
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	4
Item 3.	Defaults Upon Senior Securities.	4
Item 4.	Mine Safety Disclosure	4
Item 5.	Other Information.	4
Item 6.	Exhibits.	4

i

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

	Page
ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES
Condensed Consolidated Balance Sheets as of June 30, 2020 and March 31, 2020	F-2
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the Three Months Ended June 30, 2020 and 2019	F-3
Condensed Consolidated Statements of Changes in Shareholders’ Equity for the Three Months Ended June 30, 2020 and 2019	F-4
Condensed Consolidated Statements of Cash Flows for the Three Months Ended June 30, 2020 and 2019	F-5
Notes to Condensed Consolidated Financial Statements	F-6 – F-17

F-1

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS 

AS OF JUNE 30, 2020 AND MARCH 31, 2020

(EXPRESSED IN US DOLLARS)

	June 30,			March 31,
	2020			2020
	(Unaudited)
Assets
Current assets:
Cash and cash equivalents	$	282,496		$	240,834
Accounts receivable		2,082			5,212
Due from related parties		3,442			-
Prepaid expenses		63,124			48,789
Inventories		26,336			56,610
Other receivables		7,074			13,105
Current assets, discontinued operations (Note 3)		-			558,425
Total current assets		384,554			922,975
Property plant and equipment, net		3,804			4,498
Operating lease right-of-use assets		16,124			25,727
Non-current assets, discontinued operations (Note 3)		-			1,981,547
Total assets	$	404,482		$	2,934,747
Liabilities and shareholders’ equity
Current liabilities:
Accounts payable and accrued expenses	$	52,762		$	69,437
Customer deposits		108,378			88,131
Due to related parties		44,427			84,288
Operating lease liabilities (current)		18,682			18,630
Other payables		896			8,411
Current liabilities, discontinued operations (Note 3)		-			335,405
Total current liabilities		225,145			604,302
Non-current liabilities, discontinued operations (Note 3)		-			1,424,600
Total liabilities		225,145			2,028,902
Shareholders’ equity
Common stock; $0.001 par value, 74,000,000 shares authorized; 11,724,836 and 11,693,836 shares issued and outstanding at June 30, 2020 and March 31, 2020, respectively		11,725			11,694
Additional paid-in capital		2,115,261			2,612,954
(Deficit)		(1,963,753	)		(1,752,671	)
Other comprehensive income		16,104			9,891
Total shareholders’ equity of the Company		179,337			881,868
Non-controlling interest		-			23,977
Total shareholders’ equity		179,337			905,845
Total liabilities and shareholders’ equity	$	404,482		$	2,934,747

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

F-2

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) 

FOR THE THREE MONTHS ENDED JUNE 30, 2020 AND 2019 

(EXPRESSED IN US DOLLARS)

	For the Three Months Ended June 30,
	2020			2019
	(Unaudited)			(Unaudited)
Revenue	$	68,528		$	27,377
Cost of sales		39,349			15,050
Gross profit		29,179			12,327
Selling, general and administrative expenses		61,854			123,564
Operating (loss)		(32,675	)		(111,237	)
Other income (loss)		382			-
(Loss) before provision for income taxes		(32,293	)		(111,237	)
Provision for income taxes		-			-
Net (loss) from continuing operations		(32,293	)		(111,237	)
(Loss) on the sale of discontinued operations, net of income taxes		(941,819	)		-
Income (loss) from discontinued operations, net of income taxes (Note 3)		743			(7,392	)
Total (loss) from discontinued operations		(941,076	)		(7,392	)
Net (loss)		(973,369	)		(118,629	)
Less: net income from discontinued operations attributable to non-controlling interests		364			(3,622	)
Net (loss) attributable to common shareholders	$	(973,733	)	$	(115,007	)
Amounts attributable to controlling interest:
Net (loss) from continuing operations		(32,293	)		(111,237	)
Net income (loss) from discontinued operations		(941,440	)		(3,770	)
Earnings per share continuing operations – basic and diluted		0.00			(0.01	)
Earnings per share discontinued operations – basic and diluted		(0.08	)		0.00
Basic and diluted (loss) per share	$	(0.08	)	$	(0.01	)
Weighted average number of shares outstanding- basic and diluted		11,718,682			11,173,274
Other comprehensive (loss):
Net (loss)	$	(973,369	)	$	(118,629	)
Foreign currency translation adjustment		(2,958	)		(598	)
Comprehensive (loss)		(976,327	)		(119,227	)
Less: comprehensive income (loss) attributable to non-controlling interests		801			(6,646	)
Comprehensive (loss) attributable to the common shareholders	$	(977,128	)	$	(112,581	)

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

F-3

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

FOR THE THREE MONTHS ENDED JUNE 30, 2020 AND 2019 

(AMOUNTS IN USD, EXCEPT SHARES)

	Common stock				Additional Paid-in						Other Comprehensive			Total Shareholders’			Non- controlling			Total Shareholders Equity and
	Quantity		Amount		Capital			(Deficit)			Income (Loss)			Equity			Interest			NCI
Balance at March 31, 2019		11,167,736	$	11,168	$	1,833,730		$	(1,278,133	)	$	(1,473	)	$	565,292		$	3,759		$	569,051
Net (loss)		-		-		-			(115,007	)		-			(115,007	)		(3,622	)		(118,629	)
Sale of common shares		56,000		56		72,744			-			-			72,800			-			72,800
Foreign currency translation adjustment		-		-		-			-			2,426			2,426			(3,024	)		(598	)
Balance at June 30, 2019, unaudited		11,223,736	$	11,224	$	1,906,474		$	(1,393,140	)	$	953		$	525,511		$	(2,887	)	$	522,624
Balance at March 31, 2020		11,693,836	$	11,694	$	2,612,954		$	(1,752,671	)	$	9,891		$	881,868		$	23,977		$	905,845
Net (loss)		-		-		-			(973,733	)		-			(973,733	)		364			(973,369	)
Sale of common shares		31,000		31		46,469			-			-			46,500			-			46,500
Foreign currency translation adjustment		-		-		-			-			(3,395	)		(3,395	)		437			(2,958	)
Divestment of Lvxin		-		-		(544,162	)		762,651			9,608			228,097			(24,778	)		203,319
Balance at June 30, 2020, unaudited		11,724,836	$	11,725	$	2,115,261		$	(1,963,753	)	$	16,104		$	179,337		$	-		$	179,337

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

F-4

 ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS 

FOR THE THREE MONTHS ENDED JUNE 30, 2020 AND 2019 

(EXPRESSED IN US DOLLARS) 

	For the Three Months Ended  June 30,
	2020			2019
	(Unaudited)			(Unaudited)
Cash Flows from Operating Activities
Net (loss) from continuing operations	$	(32,293	)	$	(111,237	)
Net income from discontinued operations		(941,076	)		(7,392	)
Depreciation and amortization		705			1,012
Changes in operating assets and liabilities for sale of discontinued operations		941,819			-
Changes in operating assets and liabilities		29,363			66,323
Net cash (used in) operating activities		(1,482	)		(51,294	)
Cash Flows from Investing Activities
Divestment of Lvxin		(1,343	)		-
Net cash (used in) investing activities		(1,343	)		-
Cash Flows from Financing Activities
Proceeds from sale of common stock		38,900			20,012
Proceeds from related parties loans		-			32,206
Net cash provided by financing activities		38,900			52,218
Effect of exchange rate fluctuations on cash and cash equivalents		4,247			(10,351	)
Net increase (decrease) in cash and cash equivalents		40,322			(9,427	)
Cash and cash equivalents, beginning of year-continuing operations		240,834			11,695
Cash and cash equivalents, beginning of year-discontinued operations		1,340			1,258
Cash and cash equivalents, beginning of year		242,174			12,953
Cash and cash equivalents, end of year-continuing operations		282,496			1,887
Cash and cash equivalents, end of year-discontinued operations		-			1,639
Cash and cash equivalents, end of year	$	282,496		$	3,526
Supplemental disclosure of cash flow information:
Cash paid for income taxes	$	-		$	-
Cash paid for interest	$	-		$	-
Supplemental disclosure of non-cash activities:
(Loss) on sale of discontinued operations	$	(941,819	)	$	-
Divestment of Lvxin	$	203,319		$	-
Operating ROU assets obtained in exchange for lease liabilities	$	18,682		$	2,208,473

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

F-5

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 

(UNAUDITED)

(AMOUNTS IN US DOLLARS)

NOTE 1. NATURE OF OPERATIONS AND BASIS OF PRESENTATION

Organic Agricultural Company Limited (“Organic Agricultural”, the “Company”, “we” or “us”) was incorporated in the State of Nevada on April 17, 2018.

The Company, through its subsidiaries with headquarters in Harbin, China, sells paddy and selenium-enriched paddy products, rice and other agricultural products. At June 30, 2020, the Company’s subsidiaries were:

● Organic Agricultural (Samoa) Co., Ltd. (“Organic Agricultural Samoa”), a limited company incorporated in Samoa on December 15, 2017, is wholly owned by Organic Agricultural. Organic Agricultural Samoa owns all of the outstanding shares of capital stock of Organic Agricultural Company Limited (Hong Kong).

● Organic Agricultural Company Limited (Hong Kong) (“Organic Agricultural HK”), which was established on December 6, 2017 under the laws of Hong Kong, is wholly owned by Organic Agricultural Samoa. Organic Agricultural HK owns all of the registered equity of Heilongjiang Tianci Liangtian Agricultural Technology Development Company Limited.

● Heilongjiang Tianci Liangtian Agricultural Technology Development Company Limited. (“Tianci Liangtian”), a company incorporated in Heilongjiang, China on November 2, 2017, is wholly owned by Organic Agricultural HK. Tianci Liangtian owned all of the registered equity of Heilongjiang Yuxinqi Agricultural Technology Development Company Limited.

● Heilongjiang Yuxinqi Agricultural Technology Development Company Limited (“Yuxinqi”), a company incorporated in Heilongjiang, China on February 5, 2018, is wholly owned by Tianci Liangtian. Yuxinqi sells agricultural products, including paddy and other crops, to customers.

Reorganization

On May 16, 2018, the Company completed a corporate reorganization to combine several controlled entities (now referred to as the “subsidiaries”) into Organic Agricultural. The specific transactions related to this reorganization are as follows:

On March 31, 2017, Hao Shuping and the shareholders of Baoqing County Lvxin Paddy Rice Plant Specialized Cooperative (“Lvxin”) signed an Equity Transfer Agreement, whereby shareholders of Lvxin transferred 51% of the controlling interest in Lvxin to Hao Shuping. Hao Shuping agreed to pay the Lvxin shareholders RMB 2,029,586 (US$305,472) in cash and cause the company that would become Organic Agricultural to issue to them 152,736 shares (valued at US$152,736). Hao Shuping and the shareholders of Lvxin also signed an irrevocable supplemental agreement that gave Hao Shuping voting and managerial control over Lvxin. By June 22, 2018, Tianci Liangtian paid all of the consideration to Lvxin’s former shareholders.

On January 1, 2018, pursuant to the Equity Transfer Agreement between Hao Shuping and Tianci Liangtian, Hao Shuping transferred his 51% controlling interest in Lvxin to Tianci Liangtian. As control of both entities resided with Hao Shuping, we accounted for the combination of Lvxin with Tianci Liangtian as a transaction between entities under common control.

On January 8, 2018, the shareholders of Tianci Liangtian transferred ownership of Tianci Liangtian to Organic Agricultural HK, which is wholly owned by Organic Agricultural Samoa.

On May 16, 2018, the Company issued 10,000,000 shares of its common stock, par value $0.001 to the shareholders of Organic Agricultural Samoa, in exchange for 100% of the outstanding shares of Organic Agricultural Samoa (the “Share Exchange”).

As a result of the Share Exchange, Hao Shuping acquired 48.8% of the Company’s outstanding shares. Prior to the Share Exchange, Hao Shuping controlled Lvxin and Tianci Liangtian. Therefore, the Share Exchange was accounted for as a business combination of entities under common control in accordance with ASC 805-50-30-5. Accordingly, the assets and liabilities of the Company and its subsidiaries are presented at their carrying values at the date of the transaction; the Company’s historical stockholders’ equity was retroactively restated to the first period presented, as the acquisition of Organic Agricultural Samoa, Organic Agricultural HK, Tianci Liangtian and Lvxin was treated as a combination of entities under common control.  

F-6

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 

(UNAUDITED)

(AMOUNTS IN US DOLLARS)

NOTE 1. NATURE OF OPERATIONS AND BASIS OF PRESENTATION (Continued)

On April 24, 2020 Tianci Liangtian entered into an Equity Transfer Agreement providing for the transfer to Lou Zhengui of Tianci’s 51% interest in the equity of Baoqing County Lvxin Paddy Rice Plant Specialized Cooperative. The Agreement transferred the equity to Lou Zhengui as of April 30, 2020. Tianci Liangtian retained responsibility for the liabilities incurred by Lvxin prior to April 30, 2020, including debt of 257,731 RMB (approx. US$36,380) owed by Lvxin to Yuxingqi. Tianci Liangtian also waived a debt of 3,672,002 RMB (approx. US$518,321) owed by Lvxin to Tianci Liangtian.

In exchange for the 51% interest in Lvxin, Lou Zhengui assumed the obligation to satisfy a debt of 300,000 RMB (approx. US$42,350) owed by Tianci Liangtian to Hao Shuping, a member of the Registrant’s Board of Directors.

The business of Lvxin is growing paddy rice. The divestment of Lvxin by Tianci will enable Tianci to focus on its other business: processing and marketing food stuffs.

In accordance with U.S. GAAP, the financial position and results of operations of Lvxin are presented as discontinued operations and, as such, have been excluded from continuing operations for all periods presented. The restated historical financial statements reflecting the divestment are unaudited, but have been derived from the Company’s historical audited annual reports. The sum of the individual earnings per share amounts from continuing operations and discontinued operations may not equal the total company earnings per share amounts due to rounding. The cash flows and comprehensive income related to Lvxin have not been segregated and are included in the Condensed Consolidated Statements of Cash Flows and Comprehensive Income, respectively, for all periods presented. With the exception of Note 3, the Notes to the Unaudited Condensed Consolidated Financial Statements reflect the continuing operations of the Company. See Note 3 - Discontinued Operations below for additional information regarding discontinued operations.

Certain amounts in the prior year’s condensed consolidated financial statements and related footnotes thereto have been reclassified to conform with the current year presentation as a result of the spin-off of Lvxin.

Forward-Looking Statements

Statements in this report that are not of historical fact are forward-looking statements that involve risks and uncertainties that could affect the actual results of the Company. A description of the important factors that could cause the Company’s actual results to differ materially from the forward-looking statements contained in this report may be found in this report and the Company’s other reports filed with the Securities and Exchange Commission (the “SEC”). For further information, refer to the consolidated financial statements, footnotes and definitions thereto included in the Company’s Annual Report on Form 10-K for the year ended March 31, 2010, filed with the SEC on August 14, 2020.

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Going concern

Management has determined there is substantial doubt about our ability to continue as a going concern as a result of our lack of significant revenues and recurring losses. If we are unable to generate significant revenue or secure additional financing, we may be required to cease or curtail our operations. Our financial statements do not include adjustments that might result from the outcome of this uncertainty.

The Company’s operations have been financed primarily by proceeds from sales of shares. The Company received $46,400 during the three months ended June 30, 2020, and an additional $91,500 from June 1, 2020 to the date of filling this report, from the sale of shares. These funds provided sufficient working capital for the Company.

Management intends to expand product offerings to include value-added products, both products based on rice and products based on other food stuffs, such as organic red beans and millet.

The marketing personnel of the Company will endeavor to expand awareness of our brand, open new marketing channels, and educate the nation about the health benefits of selenium-enriched rice.

In this manner, Management hopes to make sufficient operating cash inflow to support its future operations and development of the Company in addition to capital raised from sales of shares and shareholders’ support based on needs.

F-7

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 

(UNAUDITED)

(AMOUNTS IN US DOLLARS)

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Basis of presentation

The accompanying consolidated financial statements have been prepared on the accrual basis of accounting. All significant intercompany accounts and transactions have been eliminated in consolidation when applicable.

The Company’s consolidated financial statements are expressed in U.S. Dollars and are presented in accordance with Accounting Principles Generally Accepted in the United States of America (“U.S. GAAP”).

Principles of consolidation

The consolidated financial statements include the accounts of the Company and its subsidiaries. All significant inter-company accounts and transactions have been eliminated in consolidation. The consolidated financial statements include the assets, liabilities, and net income or loss of these subsidiaries.

The Company’s subsidiaries as of June 30, 2020 are listed as follows:

Name	Place of Incorporation	Attributable equity interest %		Authorized capital
Organic Agricultural (Samoa) Co., Ltd.	Samoa		100	USD	1,000,000
Organic Agricultural Company Limited (Hong Kong)	Hong Kong		100	HKD	10,000
Heilongjiang Tianci Liangtian Agricultural Technology Development Company Limited	China		100		0
Heilongjiang Yuxinqi Agricultural Technology Development Company Limited	China		100		0

Use of estimates

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting periods. Management makes these estimates using the best information available at the time the estimates are made; however, actual results could differ from those estimates. One significant item subject to such estimates and assumptions is the inventory valuation allowance. These estimates are often based on complex judgments and assumptions that management believes to be reasonable but are inherently uncertain and unpredictable. Actual results could differ from these estimates.

Cash and cash equivalents

Cash consists of cash on hand and bank deposits, which are unrestricted as to withdrawal and use. All highly liquid investments with original stated maturities of three months or less are classified as cash and cash equivalents. The Company’s cash and cash equivalents consist of cash on hand and cash in bank, as of June 30, 2020 and March 31, 2020.

F-8

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 

(UNAUDITED)

(AMOUNTS IN US DOLLARS)

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Revenue recognition

Effective April 1, 2018, the Company adopted Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 606 — Revenue from Contracts with Customers. Under ASC 606, the Company recognizes revenue from the commercial sales of products and contracts by applying the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied.

The Company recognizes revenue when the amount of revenue can be reliably measured, it is probable that economic benefits will flow to the entity, and specific criteria have been met for each of the Company’s activities as described below.

The Company sells paddy and selenium-enriched paddy products, rice and other agricultural products. All revenue is recognized when it is both earned and realized. The Company’s policy is to recognize the sale when the products, ownership and risk of loss have transferred to the purchasers, and collection of the sales proceeds, if not prepaid, is reasonably assured, all of which generally occur when the customer receives the products. Accordingly, revenue is recognized at the point in time when delivery is made.

Given the nature of this revenue source of the Company’s business and the applicable rules guiding revenue recognition, the revenue recognition practices for the sale do not contain estimates that materially affect results of operations nor does the Company have any policy for return of products.

Fair value measurements

The Company applies the provisions of FASB ASC 820, Fair Value Measurements for fair value measurements of financial assets and financial liabilities and for fair value measurements of nonfinancial items that are recognized or disclosed at fair value in the financial statements. ASC 820 also establishes a framework for measuring fair value and expands disclosures about fair value measurements.

Fair value is defined as the price that would be received when selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In determining the fair value for the assets and liabilities required or permitted to be recorded, the Company considers the principal or most advantageous market in which it would transact, and it considers assumptions that market participants would use when pricing the asset or liability.

ASC 820 establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes three levels of inputs that may be used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to measurements involving significant unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows:

Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;

Level 2: Quoted prices, other than those in Level 1, in markets that are not active or for similar assets and liabilities, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability;

Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity).

There were no transfers between level 1, level 2 or level 3 measurements during the three months ended June 30, 2020 and 2019.

Financial assets and liabilities of the Company primarily consists of cash, account receivables, prepaid expenses, inventories, other receivables, accounts payable and accrued liabilities, customer deposits, due to related parties, and other payables. As at June 30, 2020 and March 31, 2020, the carrying values of these financial instruments approximated their fair values due to the short-term nature of these instruments.

F-9

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 

(UNAUDITED)

(AMOUNTS IN US DOLLARS)

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Functional currency and foreign currency translation

An entity’s functional currency is the currency of the primary economic environment in which it operates. Normally that is the currency of the environment in which the entity primarily generates and expends cash. Management’s judgment is essential to determine the functional currency by assessing various indicators, such as cash flows, sales price and market, expenses, financing and inter-company transactions and arrangements. The functional currency of the Company is the Chinese Renminbi (“RMB’), except the functional currency of Organic Agricultural HK is the Hong Kong Dollar (“HKD”), and the functional currency of Organic Agricultural Samoa and Organic Agricultural is the United States dollar (“US Dollars” “USD” or “$”). The reporting currency of these consolidated financial statements is in US Dollars. 

The financial statements of the Company, which are prepared using the RMB and the HKD, are translated into the Company’s reporting currency, the US Dollar. Assets and liabilities are translated using the exchange rate at each reporting period end date. Revenue and expenses are translated using average rates prevailing during each reporting period, and shareholders’ equity is translated at historical exchange rates. Adjustments resulting from the translation are recorded as a separate component of accumulated other comprehensive income or loss.

Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transactions. Foreign currency exchange gains and losses resulting from these transactions are included in operations.

The exchange rates used for foreign currency translation are as follows: 

		For the three months ended   June 30,		March 31,
		2020	2019	2020
		(USD to RMB/USD to HKD)	(USD to RMB/USD to HKD)	(USD to RMB/USD to HKD)
Assets and liabilities	period end exchange rate	7.0697/7.7504	6.8656/7.8119	7.0896/7.7529
Revenue and expenses	period average	7.0864/7.7514	6.8210/7.8396	N/A

Income taxes

The Company follows FASB ASC Topic 740, Income Taxes, which requires the recognition of deferred income taxes for the differences between the basis of assets and liabilities for financial statements and income tax purposes. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Deferred tax assets are also recognized for operating losses and for tax credit carryforwards. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

ASC 740-10-30 requires income tax positions to meet a more-likely-than-not recognition threshold to be recognized in the financial statements. Under ASC 740-10-30, tax positions that previously failed to meet the more-likely-than-not threshold should be recognized in the first subsequent financial reporting period in which that threshold is met. Under ASC 740-10-40, previously recognized tax positions that no longer meet the more-likely-than-not threshold should be derecognized in the first subsequent financial reporting period in which that threshold is no longer met.

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

According to the “PRC Income Tax Law”, Tianci Liantian and Yuxinqi are subject to a 25% standard enterprise income tax in the PRC.

F-10

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 

(UNAUDITED)

(AMOUNTS IN US DOLLARS)

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Earnings (loss) per share

The Company computes earnings (loss) per share (“EPS”) in accordance with FASB ASC 260, Earnings Per Share. ASC 260 requires companies with complex capital structures to present basic and diluted EPS. Basic EPS is measured as net income (loss) divided by the weighted average common shares outstanding during the period.

Diluted EPS is similar to basic EPS but presents the dilutive effect on a per share basis of contracts to issue ordinary common shares (e.g., convertible securities, options and warrants) as if they had been converted at the beginning of the periods presented, or issuance date, if later. The computation of diluted EPS includes the estimated impact of the exercise of contracts to purchase common stock using the treasury stock method and the potential common shares associated with convertible debt using the if-converted method. Potential common shares that have an anti-dilutive effect (i.e., those that increase earnings per share or decrease loss per share) are excluded from the calculation of diluted EPS.

Share-based compensation

The Company follows the provisions of FASB ASC 718 requiring employee equity awards to be accounted for under the fair value method. Accordingly, share-based compensation is measured at grant date, based on the fair value of the award and recognized over its vesting period. No equity instruments were granted during the three months ended June, 2020 and 2019, and no compensation expense is required to be recognized under provisions of ASC 718 with respect to employees.

Segment information and geographic data

The Company is operating in one segment in accordance with the accounting guidance in FASB ASC Topic 280, Segment Reporting. The Company’s revenues are from the sales of agricultural products to customers in the People’s Republic of China (“PRC”). All assets of the Company are located in the PRC.

Concentration of credit risk

The Company maintains cash balances in three banks in China. In China, the insurance coverage of each bank is RMB500,000 (approximately USD$71,000). As of June 30, 2020, the Company had RMB1,281,670 (approximately USD$181,000) in excess of the insurance amounts.

During the three months ended June 30, 2020, major customers Shouhang Commerce & Trade and Jiufu Zhenyuan generated 49% and 49% of revenue, respectively. During the three months ended June 30, 2019, major customer Shouhang Commerce & Trade generated 97% of revenue, respectively.

Recently adopted accounting standards

Leases

In July 2018, the FASB issued ASU No. 2018-11, Leases (Topic 842): Targeted Improvements, which provides an additional, optional transition method related to implementing the new leases standard. ASU 2018-11 provides that companies can initially apply the new lease standard at adoption and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. The Company adopted the guidance as of April 1, 2019, there is no cumulative-effect adjustment to the Company’s opening balance of retained earnings in the period of adoption. See Note 9 - Leases for further details.

We do not believe any recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on the condensed consolidated financial position, statements of operations and cash flows.

F-11

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 

(UNAUDITED)

(AMOUNTS IN US DOLLARS)

NOTE 3. DISCONTINUED OPERATIONS

As discussed in Note 1. Basis of Presentation above, on April 30, 2020, the Company completed the divestment of Lvxin and the requirements for the presentation of Lvxin as a discontinued operation were met on that date. Accordingly, Lvxin’s historical financial results are reflected in the Company’s unaudited condensed consolidated financial statements as discontinued operations. The Company did not allocate any general corporate overhead or interest expense to discontinued operations.

The financial results of Lvxin are presented as income (loss) from discontinued operations, net of income taxes in the unaudited Condensed Consolidated Statements of Operations. The following table presents the financial results of Lvxin. 

	Three months ended
	June 30, 2020		June 30, 2019
	(Unaudited)		(Unaudited)
Net sales	$	37,317	$	114,964
Cost of sales		36,574		122,401
Gross profit		743		(7,437	)
Selling, general and administrative expenses		-		395
Operating income (loss)		743		(7,832	)
Other income		-		440
Income (loss) before income taxes		743		(7,392	)
Income tax (expense) benefit		-		-
Income (loss) from discontinued operations, net of income taxes		743		(7,392	)
Less: Net income (loss) attributable to non-controlling interest		364		(3,622	)
Net income (loss) from discontinued operations attributable to controlling interest	$	379	$	(3,770	)

The following table summarizes the carrying value of major classes of assets and liabilities of Lvxin, reclassified as assets and liabilities of discontinued operations at March 31, 2020.

	March 31, 2020
ASSETS
Cash and cash equivalents	$	1,340
Inventories, net		557,085
Total current assets, discontinued operations		558,425
Operating lease right-of-use assets		1,981,547
Total non-current assets, discontinued operations	$	2,539,972
LIABILITIES
Due to related parties	$	37,146
Operating lease liabilities (current)		298,259
Total current liabilities, discontinued operations		335,405
Operating lease liabilities (non-current)		1,424,600
Total non-current liabilities, discontinued operations	$	1,760,005

F-12

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 

(UNAUDITED)

(AMOUNTS IN US DOLLARS)

NOTE 4. PREPAID EXPENSES

Prepaid expenses include prepayment of processing charges, and prepayment for products to be purchased. As of June 30, 2020 and March 31, 2020, prepayments and deferred expenses were $63,124 and $48,789, respectively.

NOTE 5. INVENTORIES

Inventories are comprised of raw materials, and finished goods (including processed rice and other agricultural products).

Raw materials include all costs of materials purchased to be used in production of the Company’s products.

Manufactured goods, rice and other products includes all expenditures incurred in bringing the goods to the point of sale and putting them in a saleable condition.

The Company values inventory on its balance sheet at the lower of cost or net realizable value. Inventories consisted of the following:

	June 30		March 31
	2020		2020
	(Unaudited)
Rice and other products		13,480		41,153
Packing and other materials		12,856		15,457
Total inventories at cost		26,336		56,610

NOTE 6. INCOME TAXES

A reconciliation of loss before income taxes for domestic and foreign locations for the three months ended June 30, 2020 and 2019 is as follows:

	For the three months ended June 30
	2020			2019
	(Unaudited)			(Unaudited)
United States	$	(16,580	)	$	(25,066	)
Foreign		(957,532	)		(86,171	)
(Loss) before income taxes	$	(974,112	)	$	(111,237	)

F-13

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 

(UNAUDITED)

(AMOUNTS IN US DOLLARS)

NOTE 6. INCOME TAXES (Continued)

The difference between the U.S. federal statutory income tax rate and the Company’s effective tax rate was as follows:

	June 30,			June 30,
	2020			2019
	(Unaudited)			(Unaudited)
U.S. federal statutory income tax rate		21	%		21	%
U.S. Valuation allowance		(21	)%		(21	)%
Rates for Tianci Liangtian and Yuxinqi, net		25	%		25	%
PRC Valuation allowance		(25	)%		(25	)%
The Company’s effective tax rate		(0	)%		(0	)%

The Company did not recognize deferred tax assets since it is not likely to realize such deferred taxes. The deferred tax would apply to the Company in the U.S. and Yuxinqi and Tianci Liangtian, in China.

As of June 30, 2020, Yuxinqi and Tianci Liangtian have total net operating loss carry forwards of $687,143 in the PRC that expire in 2024. Due to the uncertainty of utilizing these carry forwards, the Company provided a 100% allowance on all deferred tax assets of approximately $171,786 and $165,787 related to its operations in the PRC as of June 30, 2020 and March 31, 2020, respectively. The PRC valuation allowance has increased by approximately $6,000 and $18,000 for the three months ended June 30, 2020 and 2019, respectively.

The Company has incurred losses from its United States operations during all periods presented of approximately $414,000. The Company’s United States operations consist solely of ownership of its foreign subsidiaries, and the losses arise from administration expenses. Accordingly, management provided a 100% valuation allowance of approximately $87,000 and $83,000 against the deferred tax assets related to the Company’s United States operations as of June 30, 2020 and March 31, 2020, respectively, because the deferred tax benefits of the net operating loss carry forwards in the United States will not likely be utilized. The US valuation allowance has increased by approximately $4,000 and $5,000 for the three months ended June 30, 2020 and 2019, respectively.

The Company is subject to examination by the Internal Revenue Service (IRS) in the United States as well as by the taxing authorities in China, where the firm has significant business operations. The tax years under examination vary by jurisdiction. The table below presents the earliest tax year that remain subject to examination by major jurisdiction. 

	The year as of
U.S. Federal	March 31, 2019
China	March 31, 2018

United States 

The Company is subject to the U.S. corporation tax rate of 21%. 

Samoa 

Organic Agricultural (Samoa) Co., Ltd was incorporated in Samoa and, under the current laws of Samoa, it is not subject to income tax. 

China 

Tianci Liantian and Yuxinqi are subject to a 25% standard enterprise income tax in the PRC. There was no provision for income taxes for the three months ended June 30, 2020 and 2019. 

NOTE 7. OTHER PAYABLES 

Other payables consisted of the following as of the periods indicated: 

	June 30		March 31
	2020		2020
	(Unaudited)
Advances for shares to be issued	$	667		8,167
Others		229		244
	$	896	$	8,411

As of March 31, 2020, the Company had received $8,167 for the sale of common shares to be issued of which $7,500 was refunded on April 3, 2020. As of June 30, 2020, The Company had received $667 for the sale of common shares to be issued.

F-14

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 

(UNAUDITED)

(AMOUNTS IN US DOLLARS)

NOTE 8. RELATED PARTY TRANSACTIONS

Amounts due to related parties consisted of the following as of the periods indicated: 

	June 30,		March 31
	2020		2020
	(Unaudited)
Hao Shuping	$	-	$	38,874
Shen Zhenai		36,639		37,647
Xun Jianjun		7,788		7,767
	$	44,427	$	84,288

Hao Shuping is the main shareholder of the Company, Shen Zhenai is the President, Chairman of the Board, director and shareholder of the Company, and Xun Jianjun is the CEO and shareholder of the Company. These advances represent temporary borrowings for operating costs between the Company and management. They are non-interest bearing and due on demand.

Amounts due from related parties consisted of the following as of the periods indicated: 

	June 30,		March 31
	2020		2020
	(Unaudited)
Hao Shuping	$	3,442	$	-
	$	3,442	$	-

NOTE 9. RIGHT-OF-USE ASSETS AND LEASE LIABILITIES

On April 1, 2019, the Company adopted FASB ASC 842, “Leases” (“new lease standard”). The new lease standard was adopted using the optional transition method approach that allows for the cumulative effect adjustment to be recorded without restating prior periods. The Company has elected the practical expedient package related to the identification, classification and accounting for initial direct costs whereby prior conclusions do not have to be reassessed for leases that commenced before the effective date. As the Company will not reassess such conclusions, the Company has not adopted the practical expedient to use hindsight to determine the likelihood of whether a lease will be extended or terminated or whether a purchase option will be exercised.

In November 2017, Tianci Liangtian leased office space from November 20, 2017 to December 5, 2018 under an operating lease agreement (approximately 666 square meters). Under the terms of the lease, Tianci Liangtian paid approximately $1,592 in lease deposits and committed to make annual lease payments. In December 2018, Yuxingqi renewed the lease agreement. Under the terms, Yuxingqi committed to make annual lease payments of RMB290,000 (approximately US$42,000) for the period from December 6, 2018 to December 5, 2019. On December 20, 2019, Yuxingqi renewed the lease agreement. Under the terms, Yuxingqi committed to make annual lease payments of RMB290,000 (approximately US$42,000, including VAT tax) for the period from December 20, 2019 to December 19, 2020. RMB150,000 (approximately US$22,000) payment was paid on December 23, 2019. As of June 30, 2020, US$16,124 and US$18,682 was accounted as operating lease right-of-use assets and operating lease liabilities (current), respectively

The Company’s adoption of the new lease standard included new processes and controls regarding asset financing transactions, financial reporting and a system-related implementation required for the new lease standard. The impact of the adoption of the new lease standard included the recognition of right-of-use (“ROU”) assets and lease liabilities. For the three months ended June 30, 2020 and 2020, the amortization was $9,652 and $10,027, respectively.

F-15

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 

(UNAUDITED)

(AMOUNTS IN US DOLLARS)

NOTE 9. RIGHT-OF-USE ASSETS AND LEASE LIABILITIES (Continued)

Operating leases are reflected on our balance sheet within ROU assets and the related current operating lease liabilities. ROU assets represent the right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make lease payments arising from the lease agreement. ROU assets and liabilities are recognized at the commencement date, or the date on which the lessor makes the underlying asset available for use, based upon the present value of the lease payments over the respective lease term. Lease expense is recognized on a straight-line basis over the lease term, subject to any changes in the lease or expectation regarding the terms.

As of June 30, 2020, the Company has the following amounts recorded on the Company’s unaudited condensed consolidated balance sheet:

	As of June 30, 2020
	(Unaudited)
Assets
Right-of-use asset(non-current)	$	16,124
Total	$	16,124
Liabilities
Lease liability(current)	$	18,682
Total	$	18,682

Office lease:
Remaining Lease Term	1 year, renewal option
Incremental borrowing rate		4.9	%

The components of lease expense were as follows:

	For the three months ended June 30, 2020
	(Unaudited)
Amortization of ROU Asset
Office Lease	$	9,652
Interest expense		-
Total lease expense	$	9,652

Future annual minimum lease payments for non-cancellable operating leases are as follows:

Year Ending March 31	Operating Leases (Unaudited)
2021	$	18,638
Thereafter		-
Total		18,638
Less: imputed interest		-
Total	$	18,638
Reconciliation to lease liabilities:
Lease liabilities - current		18,638
Lease Liabilities	$	18,638

F-16

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 

(UNAUDITED)

(AMOUNTS IN US DOLLARS)

NOTE 10. CONTINGENCIES

Loss contingencies considered to be remote by management are generally not disclosed unless they involve guarantees, in which case the guarantee would be disclosed.

The Company was not subject to any material loss contingencies as of June 30, 2020 or March 31, 2020 and through the date of this report. 

NOTE 11. SUBSEQUENT EVENTS

During the period from July 1, 2020 to the date of filling this report, the Company received an advance of $91,500 for the sale of 60,000 shares to be issued.

The COVID-19 outbreak has had a significant adverse impact and created many uncertainties related to our business, and we expect that it will continue to do so. The Company is experiencing challenges in sales and has suffered a significant decrease in revenues which has increased financial uncertainty. Our future business outlook and expectations are very uncertain due to the impact of the COVID-19 outbreak and are very difficult to quantify. It is difficult to assess or predict the impact of this unprecedented event on our business, financial results or financial condition. Factors that will impact the extent to which the COVID-19 outbreak affects our business, financial results and financial condition include: the duration, spread and severity of the outbreak; the actions taken to contain the virus or treat its impact, including government actions to mitigate the economic impact of the outbreak; and how quickly and to what extent normal economic and operating conditions can resume, including whether any future outbreaks interrupt economic recovery.

The Management of the Company determined that there were no other reportable subsequent events to be adjusted for and/or disclosed as of the date of filing this report.

F-17

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

The following discussion and analysis of our financial condition and results of operations are based upon our condensed consolidated financial statements and the notes thereto included elsewhere in this Quarterly Report on Form 10-Q, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of such financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, and expenses. On an ongoing basis, we evaluate these estimates, including those related to useful lives of real estate assets, bad debts, impairment, contingencies and litigation. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. There can be no assurance that actual results will not differ from those estimates.

Application of Critical Accounting Policies

In preparing our financial statements, we are required to formulate working policies regarding valuation of our assets and liabilities and to develop estimates of those values. In our preparation of the financial statements for the three months ended June 30, 2020, there was no estimate made which was (a) subject to a high degree of uncertainty and (b) material to our results.

Results of Operations

The following table shows key components of the results of operations during the three months ended June 30, 2020 and 2019: 

	For the three months ended  June 30,						Change
	2020			2019			$			%
	(Unaudited)			(Unaudited)
Revenue	$	68,528		$	27,377			41,151			150	%
Cost of Sales		39,349			15,050			24,299			161	%
Gross Profit		29,179			12,327			16,852			137	%
Selling, general and administrative expenses		61,854			123,564			(61,710	)		(50	%)
(Loss) from operations before other income and income taxes		(32,675	)		(111,237	)		78,562			(71	%)
Other income		382			-			382			N/A
(Loss) from operations before income taxes		(32,293	)		(111,237	)		78,944			(71	%)
Income taxes		-			-			-			N/A
Net (loss) from continuing operations		(32,293	)		(111,237	)		78,944			(71	%)
(Loss) on the sale of discontinued operations, net of income taxes		(941,819	)		-			(941,819	)		N/A
Net income (loss) from discontinued operations, net of income taxes		743			(7,392	)		8,135			(110	%)
Total net (loss) from discontinued operations		(941,076	)		(7,392	)		(933,684	)		12631	%
Net (loss)		(973,369	)		(118,629	)		(854,740	)		721	%
Less: net income (loss) attributable to non-controlling interests		364			(3,622	)		3,986			(110	%)
Net (loss) attributable to common shareholders’	$	(973,733	)	$	(115,007	)		(858,726	)		747	%

Yuxinqi is a marketing enterprise with a focus on milled rice and other production. Incorporated on February 5, 2018, with a short operating history. Yuxingqi’s sales are erratic, since a stable customer base has not been established yet. Sales by Yuxinqi during the three months ended June 30, 2020 were substantially higher than during the three montns ended June 30, 2019. However, sales in the recent quarter substantially lagged sales in the latter months of calendar year 2019, during which Yuxinqi’s operations were expanding. The expansion was stifled in recent months by the Covid-19 pandemic and the restrictions on business activity imposed by the government in an effort to contain the effects of the pandemic in Heilongjiang Province.

The cost of sales of $39,349 and $15,050 for the three months ended June 30, 2020 and 2019, respectively, was attributable to the sales of milled rice and other foodstuffs. Those operations yielded a gross profit of $29,179 and $12,327 with a gross margin of 42.6%% and 45.0%, respectively.

To focus on the value-added processed products, the Company completed the spin-off of Lvxin on April 30, 2020. During the three months ended June 30, 2020, the Company incurred $941,819 of investment loss due to the divestment of Lvxin by Tianci Liangtian.

During the three months ended June 30, 2020 and 2019, the Company incurred $61,854 and $123,564, respectively, in operating expenses, the greater portion of which was attributable to administration - i.e. salaries and office expenses. Salaries and benefits expense was $24,280 and $45,895, and office expenses was $4,243 and $49,128, respectively, the three months ended June 30, 2020 and 2019. In response to COVID-19, we have taken steps to reduce operating costs and improve efficiency, including furloughing of our employees and regulating expenditures.

1

The Company’s continuing operations produced a net loss of $32,293 and $111,237, respectively, for the three months ended June 30, 2020 and 2019.

Liquidity and Capital Resources

The Company’s operations have been financed primarily by proceeds from the sale of shares. The Company received $46,400 for the sales of 31,000 shares during the three months ended June 30, 2020. As a result, at June 30, 2020 we had no debt other than $44,427 due to related parties, and our working capital totaled $159,409. Working capital decreased by $159,264 during the three months ended June 30 2020, primarily due to our net loss for that period and the Company’s divestment of Lvxin.

The largest component of working capital at June 30, 2020 was cash of $282,496, which reflected the impact of $108,378 in customer deposits against future sales.

Cash Flows

The following table summarizes our cash flows for the three months ended June 30, 2020 and 2019.

	For the three months ended June 30,						Change
	2020			2019			$
	(Unaudited)			(Unaudited)
Net cash (used in) operating activities	$	(1,482	)	$	(51,294	)	$	49,812
Net cash (used in) investing activities		(1,343	)		-			(1,343	)
Net cash provided by financing activities		38,900			52,218			(13,318	)
Effect of exchange rate fluctuation on cash and cash equivalents		4,247			(10,351	)		14,598
Net increase(decrease) in cash and cash equivalents		40,322			(9,427	)		49,749
Cash and cash equivalents, beginning of quarter		242,174			12,953			229,221
Cash and cash equivalents, end of quarter	$	282,496		$	3,526		$	278,970

During the three months ended June 30, 2020, our operations used net cash of $1,482. Net cash was used despite a modest profit, primarily due to the $63,124 increase in the Company’s balance for prepaid expenses. The Company recorded $51,294 of cash use in operating activities during the three months ended June 30, 2019.

The Company recorded $1,343 of cash used on the sale of discontinued operations.

Our financing activities during the three months ended June 30, 2020 generated $38,900 from sales of common stock. During the three months ended June 30, 2019, our financing activities generated $52,218, including 20,012 from sales of common stock and a $32,206 loan from related parties.

Trends, Events and Uncertainties

The Company intends to expand its product offerings to include value-added products, both products based on rice and products based on other food stuffs, such as organic red beans and millet.

Our marketing personnel will endeavor to expand awareness of our brand, open new marketing channels, and educate the nation about the health benefits of selenium-enriched rice.

In this manner, the Company hopes to make a sufficient operating cash inflow to support the future operation and development of the Company. There is no guarantee that the Company’s new strategy will be successful.

The COVID-19 outbreak has had a significant adverse impact and created many uncertainties related to our business, and we expect that it will continue to do so. The Company is experiencing challenges in sales and has suffered a significant decrease in revenues which has increased financial uncertainty. Our future business outlook and expectations are very uncertain due to the impact of the COVID-19 outbreak and are very difficult to quantify. It is difficult to assess or predict the impact of this unprecedented event on our business, financial results or financial condition. Factors that will impact the extent to which the COVID-19 outbreak affects our business, financial results and financial condition include: the duration, spread and severity of the outbreak; the actions taken to contain the virus or treat its impact, including government actions to mitigate the economic impact of the outbreak; and how quickly and to what extent normal economic and operating conditions can resume, including whether any future outbreaks interrupt economic recovery.

Other than the factors listed above we do not know of any trends, events or uncertainties that have had or are reasonably expected to have a material impact on our net sales or revenues or income from continuing operations.

2

Off-Balance Sheet Arrangements

We do not currently have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition or results of operations.

Recent Accounting Pronouncements

New accounting rules and disclosure requirements can significantly impact the comparability of our financial statements. Please refer to Note 2 of our condensed consolidated financial statements included in this quarterly report.

There were no recent accounting pronouncements that we expect to have a material effect on the Company’s financial position or results of operations.

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

Not applicable.

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Our management maintains disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are designed to provide reasonable assurance that the material information required to be disclosed by us in our periodic reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms.  Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

Under the supervision and with the participation of our management team, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) and 15d-15(e) promulgated under the Securities Exchange Act of 1934, as amended, as of June 30, 2020. Based on this evaluation, we concluded that our disclosure controls and procedures have the following material weaknesses:

● The relatively small number of employees who are responsible for accounting functions prevents us from segregating duties within our internal control system.

● Our internal financial staff lack expertise in identifying and addressing complex accounting issues under U.S. Generally Accepted Accounting Principles.

● Our Chief Financial Officer is not familiar with the accounting and reporting requirements of a U.S. public company.

● We have not developed sufficient documentation concerning our existing financial processes, risk assessment and internal controls.

Based on their evaluation, our Chief Executive Officer and Chief Financial Officer concluded that the Company’s system of disclosure controls and procedures was not effective as of June 30, 2020 for the purposes described in this paragraph.

Changes in Internal Control over Financial Reporting

No changes in the Company’s internal control over financial reporting has come to management’s attention during the Company’s last quarter that have materially affected, or are likely to materially affect, the Company’s internal control over financial reporting.

3

PART II – OTHER INFORMATION

Item 1. Legal Proceedings.

We are currently not involved in any litigation that we believe could have a material adverse effect on our financial condition or results of operations. There is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the executive officers of our company or any of our subsidiaries, threatened against or affecting our company, our common stock, any of our subsidiaries or of our companies or our subsidiaries’ officers or directors in their capacities as such, in which an adverse decision could have a material adverse effect.

Item 1A. Risk Factors.

There have been no material changes from the risk factors included in the Company’s Annual Report on Form 10-K for the year ended March 31, 2020.

ITEM 2. Unregistered Sale of Equity Securities and Use of Proceeds.

From April 1, 2020 to June 30, 2020, the Company sold 31,000 restricted shares of common stock for US$1.50 or US per share. The sales were exempt from registration pursuant to Rule 902(1)(i) of Regulation S, as the purchasers were all non-U.S. persons and Rule 903 was complied with.

ITEM 3. Defaults upon Senior Securities.

Not applicable

Item 4. Mine Safety Disclosure

Not applicable.

Item 5. Other Information.

None.

ITEM 6. EXHIBITS

INDEX TO EXHIBITS

Exhibit No.	Description of Exhibit
31.1	Certification of Chief Executive Officer pursuant to Securities Exchange Act Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification of Chief Financial Officer pursuant to Securities Exchange Act Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2	Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	XBRL Definition Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document

4

SIGNATURES

Pursuant to the requirements 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.

ORGANIC AGRICULTURAL COMPANY LIMITED

Signature	Title	Date
/s/ Jianjun Xun	Chief Executive Officer	August 20, 2020
Jianjun Xun	(Principal Executive Officer)
/s/ Yongmei Cao	Chief Financial Officer	August 20, 2020
Yongmei Cao	(Principal Financial and Accounting Officer)

5

EX-31.1

EXHIBIT 31.1

Certification of Principal Executive Officer

Section 302 Certification

I, Jianjun Xun, certify that:

1. I have reviewed this quarterly report on Form 10-Q of ORGANIC AGRICULTURAL COMPANY LIMITED;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a–15(e) and 15d–15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a–15(f) and 15d–15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual 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(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(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.

Date:	August 20, 2020	/s/ Jianjun Xun
		Jianjun Xun, Chief Executive Officer (Principal Executive Officer)

EX-31.2

EXHIBIT 31.2

Certification of Principal Financial Officer

Section 302 Certification

I, Yongmei Cao, certify that:

1. I have reviewed this quarterly report on Form 10-Q of ORGANIC AGRICULTURAL COMPANY LIMITED;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a–15(e) and 15d–15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a–15(f) and 15d–15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual 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(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(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.

Date:	August 20, 2020	/s/ Yongmei Cao
		Yongmei Cao, Chief Executive Officer (Principal Financial Officer)

EX-32.1

EXHIBIT 32.1

CERTIFICATIONS PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of ORGANIC AGRICULTURAL COMPANY LIMITED (the “Company”) on Form 10-Q for the period ended June 30, 2020, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Xun Jianjun, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. ss.1350, as adopted pursuant to ss.906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Sections 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the report fairly presents, in all material respects, the financial condition and results of operations of the Company.

By:	/s/ Jianjun Xun	Dated:	August 20, 2020
	Jianjun Xun
Title:	Chief Executive Officer (Principal Executive Officer)

EX-32.2

EXHIBIT 32.2

CERTIFICATIONS PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of ORGANIC AGRICULTURAL COMPANY LIMITED (the “Company”) on Form 10-Q for the period ended June 30, 2020, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Cao Yongmei, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. ss.1350, as adopted pursuant to ss.906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

By:	/s/ Yongmei Cao	Dated:	August 20, 2020
	Yongmei Cao
Title:	Chief Financial Officer (Principal Financial Officer)

XML

Document and Entity Information - shares	3 Months Ended
	Jun. 30, 2020	Aug. 20, 2020
Document and Entity Information [Abstract]
Entity Registrant Name	Organic Agricultural Co Ltd
Entity Central Index Key	0001749849
Amendment Flag	false
Current Fiscal Year End Date	--03-31
Document Type	10-Q
Document Period End Date	Jun. 30, 2020
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2021
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Shell Company	false
Entity Ex Transition Period	false
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Common Stock, Shares Outstanding		11,724,836
Entity File Number	0-56168
Entity Interactive Data Current	Yes
Entity Incorporation State Country Code	NV

XML

Condensed Consolidated Balance Sheets - USD ($)	Jun. 30, 2020	Mar. 31, 2020
Current assets:
Cash and cash equivalents	$ 282,496	$ 240,834
Accounts receivable	2,082	5,212
Due from related parties	3,442
Prepaid expenses	63,124	48,789
Inventories	26,336	56,610
Other receivables	7,074	13,105
Current assets, discontinued operations (Note 3)		558,425
Total current assets	384,554	922,975
Property plant and equipment, net	3,804	4,498
Operating lease right-of-use assets	16,124	25,727
Non-current assets, discontinued operations (Note 3)		1,981,547
Total assets	404,482	2,934,747
Current liabilities:
Accounts payable and accrued expenses	52,762	69,437
Customer deposits	108,378	88,131
Due to related parties	44,427	84,288
Operating lease liabilities (current)	18,682	18,630
Other payables	896	8,411
Current liabilities, discontinued operations (Note 3)		335,405
Total current liabilities	225,145	604,302
Non-current liabilities, discontinued operations (Note 3)		1,424,600
Total liabilities	225,145	2,028,902
Shareholders' equity
Common stock; $0.001 par value, 74,000,000 shares authorized; 11,724,836 and 11,693,836 shares issued and outstanding at June 30, 2020 and March 31, 2020, respectively	11,725	11,694
Additional paid-in capital	2,115,261	2,612,954
(Deficit)	(1,963,753)	(1,752,671)
Other comprehensive income	16,104	9,891
Total shareholders' equity of the Company	179,337	881,868
Non-controlling interest		23,977
Total shareholders' equity	179,337	905,845
Total liabilities and shareholders' equity	$ 404,482	$ 2,934,747

XML

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Jun. 30, 2020	Mar. 31, 2020
Statement of Financial Position [Abstract]
Common stock, par value	$ 0.001	$ 0.001
Common stock, authorized	74,000,000	74,000,000
Common stock, issued	11,724,836	11,693,836
Common stock, outstanding	11,724,836	11,693,836

XML

Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) - USD ($)	3 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
Income Statement [Abstract]
Revenue	$ 68,528	$ 27,377
Cost of sales	39,349	15,050
Gross profit	29,179	12,327
Selling, general and administrative expenses	61,854	123,564
Operating (loss)	(32,675)	(111,237)
Other income (loss)	382
(Loss) before provision for income taxes	(32,293)	(111,237)
Provision for income taxes
Net (loss) from continuing operations	(32,293)	(111,237)
(Loss) on the sale of discontinued operations, net of income taxes	(941,819)
Income (loss) from discontinued operations, net of income taxes (Note 3)	743	(7,392)
Total (loss) from discontinued operations	(941,076)	(7,392)
Net (loss)	(973,369)	(118,629)
Less: net income attributable to non-controlling interests	364	(3,622)
Net (loss) attributable to common shareholders	(973,733)	(115,007)
Amounts attributable to controlling interest:
Net (loss) from continuing operations	(32,293)	(111,237)
Net income (loss) from discontinued operations	$ (941,440)	$ (3,770)
Earnings per share continuing operations – basic and diluted	$ 0.00	$ (0.01)
Earnings per share discontinued operations – basic and diluted	(0.08)	0
Basic and diluted (loss) per share	$ (0.08)	$ (0.01)
Weighted average number of shares outstanding- basic and diluted	11,718,682	11,173,274
Other comprehensive (loss):
Net (loss)	$ (973,369)	$ (118,629)
Foreign currency translation adjustment	(2,958)	(598)
Comprehensive (loss)	(976,327)	(119,227)
Less: comprehensive income attributable to non-controlling interests	801	(6,646)
Comprehensive (loss) attributable to the common shareholders	$ (977,128)	$ (112,581)

XML

Condensed Consolidated Statements of Changes in Shareholders’ Equity - USD ($)	Common stock	Additional Paid-in Capital	(Deficit)	Other Comprehensive Income (Loss)	Total Shareholders' Equity	Non-controlling Interest	Total
Balance at Mar. 31, 2019	$ 11,168	$ 1,833,730	$ (1,278,133)	$ (1,473)	$ 565,292	$ 3,759	$ 569,051
Balance, Shares at Mar. 31, 2019	11,167,736
Net (loss)			(115,007)		(115,007)	(3,622)	(118,629)
Sale of common shares	$ 56	72,744			72,800		72,800
Sale of common shares, Shares	56,000
Foreign currency translation adjustment				2,426	2,426	(3,024)	(598)
Balance at Jun. 30, 2019	$ 11,224	1,906,474	(1,393,140)	953	525,511	(2,887)	522,624
Balance, Shares at Jun. 30, 2019	11,223,736
Balance at Mar. 31, 2020	$ 11,694	2,612,954	(1,752,671)	9,891	881,868	23,977	905,845
Balance, Shares at Mar. 31, 2020	11,693,836
Net (loss)			(973,733)		(973,733)	364	(973,369)
Sale of common shares	$ 31	46,469			46,500		46,500
Sale of common shares, Shares	31,000
Foreign currency translation adjustment				(3,395)	(3,395)	437	(2,958)
Divestment of Lvxin		(544,162)	762,651	9,608	228,097	(24,778)	203,319
Balance at Jun. 30, 2020	$ 11,725	$ 2,115,261	$ (1,963,753)	$ 16,104	$ 179,337		$ 179,337
Balance, Shares at Jun. 30, 2020	11,724,836

XML

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)	3 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
Cash Flows from Operating Activities
Net (loss) from continuing operations	$ (32,293)	$ (111,237)
Net income from discontinued operations	(941,076)	(7,392)
Depreciation and amortization	705	1,012
Changes in operating assets and liabilities for sale of discontinued operations	941,819
Changes in operating assets and liabilities	29,363	66,323
Net cash (used in) operating activities	(1,482)	(51,294)
Cash Flows from Investing Activities
Divestment of Lvxin	(1,343)
Net cash (used in) investing activities	(1,343)
Cash Flows from Financing Activities
Proceeds from sale of common stock	38,900	20,012
Proceeds from related parties loans		32,206
Net cash provided by financing activities	38,900	52,218
Effect of exchange rate fluctuations on cash and cash equivalents	4,247	(10,351)
Net increase (decrease) in cash and cash equivalents	40,322	(9,427)
Cash and cash equivalents, beginning of year-continuing operations	240,834	11,695
Cash and cash equivalents, beginning of year-discontinued operations	1,340	1,258
Cash and cash equivalents, beginning of year	242,174	12,953
Cash and cash equivalents, end of year-continuing operations	282,496	1,887
Cash and cash equivalents, end of year-discontinued operations		1,639
Cash and cash equivalents, end of year	282,496	3,526
Supplemental disclosure of cash flow information:
Cash paid for income taxes
Cash paid for interest
Supplemental disclosure of non-cash activities:
(Loss) on sale of discontinued operations	(941,819)
Divestment of Lvxin	203,319
Operating ROU assets obtained in exchange for lease liabilities	$ 18,682	$ 2,208,473

XML

Nature of Operations and Basis of Presentation

3 Months Ended

Jun. 30, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

NATURE OF OPERATIONS AND BASIS OF PRESENTATION

NOTE 1. NATURE OF OPERATIONS AND BASIS OF PRESENTATION

Organic Agricultural Company Limited ("Organic Agricultural", the "Company", "we" or "us") was incorporated in the State of Nevada on April 17, 2018.

The Company, through its subsidiaries with headquarters in Harbin, China, sells paddy and selenium-enriched paddy products, rice and other agricultural products. At June 30, 2020, the Company's subsidiaries were:

● Organic Agricultural (Samoa) Co., Ltd. ("Organic Agricultural Samoa"), a limited company incorporated in Samoa on December 15, 2017, is wholly owned by Organic Agricultural. Organic Agricultural Samoa owns all of the outstanding shares of capital stock of Organic Agricultural Company Limited (Hong Kong).

● Organic Agricultural Company Limited (Hong Kong) ("Organic Agricultural HK"), which was established on December 6, 2017 under the laws of Hong Kong, is wholly owned by Organic Agricultural Samoa. Organic Agricultural HK owns all of the registered equity of Heilongjiang Tianci Liangtian Agricultural Technology Development Company Limited.

● Heilongjiang Tianci Liangtian Agricultural Technology Development Company Limited. ("Tianci Liangtian"), a company incorporated in Heilongjiang, China on November 2, 2017, is wholly owned by Organic Agricultural HK. Tianci Liangtian owned all of the registered equity of Heilongjiang Yuxinqi Agricultural Technology Development Company Limited.

● Heilongjiang Yuxinqi Agricultural Technology Development Company Limited ("Yuxinqi"), a company incorporated in Heilongjiang, China on February 5, 2018, is wholly owned by Tianci Liangtian. Yuxinqi sells agricultural products, including paddy and other crops, to customers.

Reorganization

On May 16, 2018, the Company completed a corporate reorganization to combine several controlled entities (now referred to as the "subsidiaries") into Organic Agricultural. The specific transactions related to this reorganization are as follows:

On March 31, 2017, Hao Shuping and the shareholders of Baoqing County Lvxin Paddy Rice Plant Specialized Cooperative ("Lvxin") signed an Equity Transfer Agreement, whereby shareholders of Lvxin transferred 51% of the controlling interest in Lvxin to Hao Shuping. Hao Shuping agreed to pay the Lvxin shareholders RMB 2,029,586 (US$305,472) in cash and cause the company that would become Organic Agricultural to issue to them 152,736 shares (valued at US$152,736). Hao Shuping and the shareholders of Lvxin also signed an irrevocable supplemental agreement that gave Hao Shuping voting and managerial control over Lvxin. By June 22, 2018, Tianci Liangtian paid all of the consideration to Lvxin's former shareholders.

On January 1, 2018, pursuant to the Equity Transfer Agreement between Hao Shuping and Tianci Liangtian, Hao Shuping transferred his 51% controlling interest in Lvxin to Tianci Liangtian. As control of both entities resided with Hao Shuping, we accounted for the combination of Lvxin with Tianci Liangtian as a transaction between entities under common control.

On January 8, 2018, the shareholders of Tianci Liangtian transferred ownership of Tianci Liangtian to Organic Agricultural HK, which is wholly owned by Organic Agricultural Samoa.

On May 16, 2018, the Company issued 10,000,000 shares of its common stock, par value $0.001 to the shareholders of Organic Agricultural Samoa, in exchange for 100% of the outstanding shares of Organic Agricultural Samoa (the "Share Exchange").

As a result of the Share Exchange, Hao Shuping acquired 48.8% of the Company's outstanding shares. Prior to the Share Exchange, Hao Shuping controlled Lvxin and Tianci Liangtian. Therefore, the Share Exchange was accounted for as a business combination of entities under common control in accordance with ASC 805-50-30-5. Accordingly, the assets and liabilities of the Company and its subsidiaries are presented at their carrying values at the date of the transaction; the Company's historical stockholders' equity was retroactively restated to the first period presented, as the acquisition of Organic Agricultural Samoa, Organic Agricultural HK, Tianci Liangtian and Lvxin was treated as a combination of entities under common control.  

On April 24, 2020 Tianci Liangtian entered into an Equity Transfer Agreement providing for the transfer to Lou Zhengui of Tianci's 51% interest in the equity of Baoqing County Lvxin Paddy Rice Plant Specialized Cooperative. The Agreement transferred the equity to Lou Zhengui as of April 30, 2020. Tianci Liangtian retained responsibility for the liabilities incurred by Lvxin prior to April 30, 2020, including debt of 257,731 RMB (approx. US$36,380) owed by Lvxin to Yuxingqi. Tianci Liangtian also waived a debt of 3,672,002 RMB (approx. US$518,321) owed by Lvxin to Tianci Liangtian.

In exchange for the 51% interest in Lvxin, Lou Zhengui assumed the obligation to satisfy a debt of 300,000 RMB (approx. US$42,350) owed by Tianci Liangtian to Hao Shuping, a member of the Registrant's Board of Directors.

The business of Lvxin is growing paddy rice. The divestment of Lvxin by Tianci will enable Tianci to focus on its other business: processing and marketing food stuffs.

In accordance with U.S. GAAP, the financial position and results of operations of Lvxin are presented as discontinued operations and, as such, have been excluded from continuing operations for all periods presented. The restated historical financial statements reflecting the divestment are unaudited, but have been derived from the Company's historical audited annual reports. The sum of the individual earnings per share amounts from continuing operations and discontinued operations may not equal the total company earnings per share amounts due to rounding. The cash flows and comprehensive income related to Lvxin have not been segregated and are included in the Condensed Consolidated Statements of Cash Flows and Comprehensive Income, respectively, for all periods presented. With the exception of Note 3, the Notes to the Unaudited Condensed Consolidated Financial Statements reflect the continuing operations of the Company. See Note 3 - Discontinued Operations below for additional information regarding discontinued operations.

Certain amounts in the prior year's condensed consolidated financial statements and related footnotes thereto have been reclassified to conform with the current year presentation as a result of the spin-off of Lvxin.

Forward-Looking Statements

Statements in this report that are not of historical fact are forward-looking statements that involve risks and uncertainties that could affect the actual results of the Company. A description of the important factors that could cause the Company's actual results to differ materially from the forward-looking statements contained in this report may be found in this report and the Company's other reports filed with the Securities and Exchange Commission (the "SEC"). For further information, refer to the consolidated financial statements, footnotes and definitions thereto included in the Company's Annual Report on Form 10-K for the year ended March 31, 2010, filed with the SEC on August 14, 2020.

XML

Summary of Significant Accounting Policies

3 Months Ended

Jun. 30, 2020

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Going concern

Management has determined there is substantial doubt about our ability to continue as a going concern as a result of our lack of significant revenues and recurring losses. If we are unable to generate significant revenue or secure additional financing, we may be required to cease or curtail our operations. Our financial statements do not include adjustments that might result from the outcome of this uncertainty.

The Company's operations have been financed primarily by proceeds from sales of shares. The Company received $46,400 during the three months ended June 30, 2020, and an additional $91,500 from June 1, 2020 to the date of filling this report, from the sale of shares. These funds provided sufficient working capital for the Company.

Management intends to expand product offerings to include value-added products, both products based on rice and products based on other food stuffs, such as organic red beans and millet.

The marketing personnel of the Company will endeavor to expand awareness of our brand, open new marketing channels, and educate the nation about the health benefits of selenium-enriched rice.

In this manner, Management hopes to make sufficient operating cash inflow to support its future operations and development of the Company in addition to capital raised from sales of shares and shareholders' support based on needs.

Basis of presentation

The accompanying consolidated financial statements have been prepared on the accrual basis of accounting. All significant intercompany accounts and transactions have been eliminated in consolidation when applicable.

The Company's consolidated financial statements are expressed in U.S. Dollars and are presented in accordance with Accounting Principles Generally Accepted in the United States of America ("U.S. GAAP").

Principles of consolidation

The consolidated financial statements include the accounts of the Company and its subsidiaries. All significant inter-company accounts and transactions have been eliminated in consolidation. The consolidated financial statements include the assets, liabilities, and net income or loss of these subsidiaries.

The Company's subsidiaries as of June 30, 2020 are listed as follows:

Name	Place of Incorporation	Attributable equity interest %		Authorized capital
Organic Agricultural (Samoa) Co., Ltd.	Samoa		100	USD	1,000,000
Organic Agricultural Company Limited (Hong Kong)	Hong Kong		100	HKD	10,000
Heilongjiang Tianci Liangtian Agricultural Technology Development Company Limited	China		100		0
Heilongjiang Yuxinqi Agricultural Technology Development Company Limited	China		100		0

Use of estimates

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting periods. Management makes these estimates using the best information available at the time the estimates are made; however, actual results could differ from those estimates. One significant item subject to such estimates and assumptions is the inventory valuation allowance. These estimates are often based on complex judgments and assumptions that management believes to be reasonable but are inherently uncertain and unpredictable. Actual results could differ from these estimates.

Cash and cash equivalents

Cash consists of cash on hand and bank deposits, which are unrestricted as to withdrawal and use. All highly liquid investments with original stated maturities of three months or less are classified as cash and cash equivalents. The Company's cash and cash equivalents consist of cash on hand and cash in bank, as of June 30, 2020 and March 31, 2020.

Revenue recognition

Effective April 1, 2018, the Company adopted Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 606 — Revenue from Contracts with Customers. Under ASC 606, the Company recognizes revenue from the commercial sales of products and contracts by applying the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied.

The Company recognizes revenue when the amount of revenue can be reliably measured, it is probable that economic benefits will flow to the entity, and specific criteria have been met for each of the Company's activities as described below.

The Company sells paddy and selenium-enriched paddy products, rice and other agricultural products. All revenue is recognized when it is both earned and realized. The Company's policy is to recognize the sale when the products, ownership and risk of loss have transferred to the purchasers, and collection of the sales proceeds, if not prepaid, is reasonably assured, all of which generally occur when the customer receives the products. Accordingly, revenue is recognized at the point in time when delivery is made.

Given the nature of this revenue source of the Company's business and the applicable rules guiding revenue recognition, the revenue recognition practices for the sale do not contain estimates that materially affect results of operations nor does the Company have any policy for return of products.

Fair value measurements

The Company applies the provisions of FASB ASC 820, Fair Value Measurements for fair value measurements of financial assets and financial liabilities and for fair value measurements of nonfinancial items that are recognized or disclosed at fair value in the financial statements. ASC 820 also establishes a framework for measuring fair value and expands disclosures about fair value measurements.

Fair value is defined as the price that would be received when selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In determining the fair value for the assets and liabilities required or permitted to be recorded, the Company considers the principal or most advantageous market in which it would transact, and it considers assumptions that market participants would use when pricing the asset or liability.

ASC 820 establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes three levels of inputs that may be used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to measurements involving significant unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows:

Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;

Level 2: Quoted prices, other than those in Level 1, in markets that are not active or for similar assets and liabilities, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability;

Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity).

There were no transfers between level 1, level 2 or level 3 measurements during the three months ended June 30, 2020 and 2019.

Financial assets and liabilities of the Company primarily consists of cash, account receivables, prepaid expenses, inventories, other receivables, accounts payable and accrued liabilities, customer deposits, due to related parties, and other payables. As at June 30, 2020 and March 31, 2020, the carrying values of these financial instruments approximated their fair values due to the short-term nature of these instruments.

Functional currency and foreign currency translation

An entity's functional currency is the currency of the primary economic environment in which it operates. Normally that is the currency of the environment in which the entity primarily generates and expends cash. Management's judgment is essential to determine the functional currency by assessing various indicators, such as cash flows, sales price and market, expenses, financing and inter-company transactions and arrangements. The functional currency of the Company is the Chinese Renminbi ("RMB'), except the functional currency of Organic Agricultural HK is the Hong Kong Dollar ("HKD"), and the functional currency of Organic Agricultural Samoa and Organic Agricultural is the United States dollar ("US Dollars" "USD" or "$"). The reporting currency of these consolidated financial statements is in US Dollars. 

The financial statements of the Company, which are prepared using the RMB and the HKD, are translated into the Company's reporting currency, the US Dollar. Assets and liabilities are translated using the exchange rate at each reporting period end date. Revenue and expenses are translated using average rates prevailing during each reporting period, and shareholders' equity is translated at historical exchange rates. Adjustments resulting from the translation are recorded as a separate component of accumulated other comprehensive income or loss.

Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transactions. Foreign currency exchange gains and losses resulting from these transactions are included in operations.

The exchange rates used for foreign currency translation are as follows: 

		For the three months ended   June 30,		March 31,
		2020	2019	2020
		(USD to RMB/USD to HKD)	(USD to RMB/USD to HKD)	(USD to RMB/USD to HKD)
Assets and liabilities	period end exchange rate	7.0697/7.7504	6.8656/7.8119	7.0896/7.7529
Revenue and expenses	period average	7.0864/7.7514	6.8210/7.8396	N/A

Income taxes

The Company follows FASB ASC Topic 740, Income Taxes, which requires the recognition of deferred income taxes for the differences between the basis of assets and liabilities for financial statements and income tax purposes. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Deferred tax assets are also recognized for operating losses and for tax credit carryforwards. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

ASC 740-10-30 requires income tax positions to meet a more-likely-than-not recognition threshold to be recognized in the financial statements. Under ASC 740-10-30, tax positions that previously failed to meet the more-likely-than-not threshold should be recognized in the first subsequent financial reporting period in which that threshold is met. Under ASC 740-10-40, previously recognized tax positions that no longer meet the more-likely-than-not threshold should be derecognized in the first subsequent financial reporting period in which that threshold is no longer met.

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

According to the "PRC Income Tax Law", Tianci Liantian and Yuxinqi are subject to a 25% standard enterprise income tax in the PRC.

Earnings (loss) per share

The Company computes earnings (loss) per share ("EPS") in accordance with FASB ASC 260, Earnings Per Share. ASC 260 requires companies with complex capital structures to present basic and diluted EPS. Basic EPS is measured as net income (loss) divided by the weighted average common shares outstanding during the period.

Diluted EPS is similar to basic EPS but presents the dilutive effect on a per share basis of contracts to issue ordinary common shares (e.g., convertible securities, options and warrants) as if they had been converted at the beginning of the periods presented, or issuance date, if later. The computation of diluted EPS includes the estimated impact of the exercise of contracts to purchase common stock using the treasury stock method and the potential common shares associated with convertible debt using the if-converted method. Potential common shares that have an anti-dilutive effect (i.e., those that increase earnings per share or decrease loss per share) are excluded from the calculation of diluted EPS.

Share-based compensation

The Company follows the provisions of FASB ASC 718 requiring employee equity awards to be accounted for under the fair value method. Accordingly, share-based compensation is measured at grant date, based on the fair value of the award and recognized over its vesting period. No equity instruments were granted during the three months ended June, 2020 and 2019, and no compensation expense is required to be recognized under provisions of ASC 718 with respect to employees.

Segment information and geographic data

The Company is operating in one segment in accordance with the accounting guidance in FASB ASC Topic 280, Segment Reporting. The Company's revenues are from the sales of agricultural products to customers in the People's Republic of China ("PRC"). All assets of the Company are located in the PRC.

Concentration of credit risk

The Company maintains cash balances in three banks in China. In China, the insurance coverage of each bank is RMB500,000 (approximately USD$71,000). As of June 30, 2020, the Company had RMB1,281,670 (approximately USD$181,000) in excess of the insurance amounts.

During the three months ended June 30, 2020, major customers Shouhang Commerce & Trade and Jiufu Zhenyuan generated 49% and 49% of revenue, respectively. During the three months ended June 30, 2019, major customer Shouhang Commerce & Trade generated 97% of revenue, respectively.

Recently adopted accounting standards

Leases

In July 2018, the FASB issued ASU No. 2018-11, Leases (Topic 842): Targeted Improvements, which provides an additional, optional transition method related to implementing the new leases standard. ASU 2018-11 provides that companies can initially apply the new lease standard at adoption and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. The Company adopted the guidance as of April 1, 2019, there is no cumulative-effect adjustment to the Company's opening balance of retained earnings in the period of adoption. See Note 9 - Leases for further details.

We do not believe any recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on the condensed consolidated financial position, statements of operations and cash flows.

XML

Discontinued Operations

3 Months Ended

Jun. 30, 2020

Discontinued Operations [Abstract]

DISCONTINUED OPERATIONS

NOTE 3. DISCONTINUED OPERATIONS

As discussed in Note 1. Basis of Presentation above, on April 30, 2020, the Company completed the divestment of Lvxin and the requirements for the presentation of Lvxin as a discontinued operation were met on that date. Accordingly, Lvxin's historical financial results are reflected in the Company's unaudited condensed consolidated financial statements as discontinued operations. The Company did not allocate any general corporate overhead or interest expense to discontinued operations.

The financial results of Lvxin are presented as income (loss) from discontinued operations, net of income taxes in the unaudited Condensed Consolidated Statements of Operations. The following table presents the financial results of Lvxin. 

	Three months ended
	June 30, 2020		June 30, 2019
	(Unaudited)		(Unaudited)
Net sales	$	37,317	$	114,964
Cost of sales		36,574		122,401
Gross profit		743		(7,437	)
Selling, general and administrative expenses		-		395
Operating income (loss)		743		(7,832	)
Other income		-		440
Income (loss) before income taxes		743		(7,392	)
Income tax (expense) benefit		-		-
Income (loss) from discontinued operations, net of income taxes		743		(7,392	)
Less: Net income (loss) attributable to non-controlling interest		364		(3,622	)
Net income (loss) from discontinued operations attributable to controlling interest	$	379	$	(3,770	)

The following table summarizes the carrying value of major classes of assets and liabilities of Lvxin, reclassified as assets and liabilities of discontinued operations at March 31, 2020.

	March 31, 2020
ASSETS
Cash and cash equivalents	$	1,340
Inventories, net		557,085
Total current assets, discontinued operations		558,425
Operating lease right-of-use assets		1,981,547
Total non-current assets, discontinued operations	$	2,539,972
LIABILITIES
Due to related parties	$	37,146
Operating lease liabilities (current)		298,259
Total current liabilities, discontinued operations		335,405
Operating lease liabilities (non-current)		1,424,600
Total non-current liabilities, discontinued operations	$	1,760,005

XML

Prepaid Expenses

3 Months Ended

Jun. 30, 2020

Prepaid Expenses [Abstract]

PREPAID EXPENSES

NOTE 4. PREPAID EXPENSES

Prepaid expenses include prepayment of processing charges, and prepayment for products to be purchased. As of June 30, 2020 and March 31, 2020, prepayments and deferred expenses were $63,124 and $48,789, respectively.

XML

Inventories

3 Months Ended

Jun. 30, 2020

Inventory Disclosure [Abstract]

INVENTORIES

NOTE 5. INVENTORIES

Inventories are comprised of raw materials, and finished goods (including processed rice and other agricultural products).

Raw materials include all costs of materials purchased to be used in production of the Company's products.

Manufactured goods, rice and other products includes all expenditures incurred in bringing the goods to the point of sale and putting them in a saleable condition.

The Company values inventory on its balance sheet at the lower of cost or net realizable value. Inventories consisted of the following:

	June 30		March 31
	2020		2020
	(Unaudited)
Rice and other products		13,480		41,153
Packing and other materials		12,856		15,457
Total inventories at cost		26,336		56,610

XML

Income Taxes

3 Months Ended

Jun. 30, 2020

Income Tax Disclosure [Abstract]

INCOME TAXES

NOTE 6. INCOME TAXES

A reconciliation of loss before income taxes for domestic and foreign locations for the three months ended June 30, 2020 and 2019 is as follows:

	For the three months ended June 30
	2020			2019
	(Unaudited)			(Unaudited)
United States	$	(16,580	)	$	(25,066	)
Foreign		(957,532	)		(86,171	)
(Loss) before income taxes	$	(974,112	)	$	(111,237	)

The difference between the U.S. federal statutory income tax rate and the Company's effective tax rate was as follows:

	June 30,			June 30,
	2020			2019
	(Unaudited)			(Unaudited)
U.S. federal statutory income tax rate		21	%		21	%
U.S. Valuation allowance		(21	)%		(21	)%
Rates for Tianci Liangtian and Yuxinqi, net		25	%		25	%
PRC Valuation allowance		(25	)%		(25	)%
The Company's effective tax rate		(0	)%		(0	)%

The Company did not recognize deferred tax assets since it is not likely to realize such deferred taxes. The deferred tax would apply to the Company in the U.S. and Yuxinqi and Tianci Liangtian, in China.

As of June 30, 2020, Yuxinqi and Tianci Liangtian have total net operating loss carry forwards of $687,143 in the PRC that expire in 2024. Due to the uncertainty of utilizing these carry forwards, the Company provided a 100% allowance on all deferred tax assets of approximately $171,786 and $165,787 related to its operations in the PRC as of June 30, 2020 and March 31, 2020, respectively. The PRC valuation allowance has increased by approximately $6,000 and $18,000 for the three months ended June 30, 2020 and 2019, respectively.

The Company has incurred losses from its United States operations during all periods presented of approximately $414,000. The Company's United States operations consist solely of ownership of its foreign subsidiaries, and the losses arise from administration expenses. Accordingly, management provided a 100% valuation allowance of approximately $87,000 and $83,000 against the deferred tax assets related to the Company's United States operations as of June 30, 2020 and March 31, 2020, respectively, because the deferred tax benefits of the net operating loss carry forwards in the United States will not likely be utilized. The US valuation allowance has increased by approximately $4,000 and $5,000 for the three months ended June 30, 2020 and 2019, respectively.

The Company is subject to examination by the Internal Revenue Service (IRS) in the United States as well as by the taxing authorities in China, where the firm has significant business operations. The tax years under examination vary by jurisdiction. The table below presents the earliest tax year that remain subject to examination by major jurisdiction. 

	The year as of
U.S. Federal	March 31, 2019
China	March 31, 2018

United States 

The Company is subject to the U.S. corporation tax rate of 21%. 

Samoa 

Organic Agricultural (Samoa) Co., Ltd was incorporated in Samoa and, under the current laws of Samoa, it is not subject to income tax. 

China 

Tianci Liantian and Yuxinqi are subject to a 25% standard enterprise income tax in the PRC. There was no provision for income taxes for the three months ended June 30, 2020 and 2019.

XML

Other Payables

3 Months Ended

Jun. 30, 2020

Payables and Accruals [Abstract]

OTHER PAYABLES

NOTE 7. OTHER PAYABLES 

Other payables consisted of the following as of the periods indicated: 

	June 30		March 31
	2020		2020
	(Unaudited)
Advances for shares to be issued	$	667		8,167
Others		229		244
	$	896	$	8,411

As of March 31, 2020, the Company had received $8,167 for the sale of common shares to be issued of which $7,500 was refunded on April 3, 2020. As of June 30, 2020, The Company had received $667 for the sale of common shares to be issued.

XML

Related Party Transactions

3 Months Ended

Jun. 30, 2020

Related Party Transactions [Abstract]

RELATED PARTY TRANSACTIONS

NOTE 8. RELATED PARTY TRANSACTIONS

Amounts due to related parties consisted of the following as of the periods indicated: 

	June 30,		March 31
	2020		2020
	(Unaudited)
Hao Shuping	$	-	$	38,874
Shen Zhenai		36,639		37,647
Xun Jianjun		7,788		7,767
	$	44,427	$	84,288

Hao Shuping is the main shareholder of the Company, Shen Zhenai is the President, Chairman of the Board, director and shareholder of the Company, and Xun Jianjun is the CEO and shareholder of the Company. These advances represent temporary borrowings for operating costs between the Company and management. They are non-interest bearing and due on demand.

Amounts due from related parties consisted of the following as of the periods indicated: 

	June 30,		March 31
	2020		2020
	(Unaudited)
Hao Shuping	$	3,442	$	-
	$	3,442	$	-

XML

Right-of-Use Assets and Lease Liabilities

3 Months Ended

Jun. 30, 2020

Right-of-Use Assets And Lease Liabilities [Abstract]

RIGHT-OF-USE ASSETS AND LEASE LIABILITIES

NOTE 9. RIGHT-OF-USE ASSETS AND LEASE LIABILITIES

On April 1, 2019, the Company adopted FASB ASC 842, "Leases" ("new lease standard"). The new lease standard was adopted using the optional transition method approach that allows for the cumulative effect adjustment to be recorded without restating prior periods. The Company has elected the practical expedient package related to the identification, classification and accounting for initial direct costs whereby prior conclusions do not have to be reassessed for leases that commenced before the effective date. As the Company will not reassess such conclusions, the Company has not adopted the practical expedient to use hindsight to determine the likelihood of whether a lease will be extended or terminated or whether a purchase option will be exercised.

In November 2017, Tianci Liangtian leased office space from November 20, 2017 to December 5, 2018 under an operating lease agreement (approximately 666 square meters). Under the terms of the lease, Tianci Liangtian paid approximately $1,592 in lease deposits and committed to make annual lease payments. In December 2018, Yuxingqi renewed the lease agreement. Under the terms, Yuxingqi committed to make annual lease payments of RMB290,000 (approximately US$42,000) for the period from December 6, 2018 to December 5, 2019. On December 20, 2019, Yuxingqi renewed the lease agreement. Under the terms, Yuxingqi committed to make annual lease payments of RMB290,000 (approximately US$42,000, including VAT tax) for the period from December 20, 2019 to December 19, 2020. RMB150,000 (approximately US$22,000) payment was paid on December 23, 2019. As of June 30, 2020, US$16,124 and US$18,682 was accounted as operating lease right-of-use assets and operating lease liabilities (current), respectively

The Company's adoption of the new lease standard included new processes and controls regarding asset financing transactions, financial reporting and a system-related implementation required for the new lease standard. The impact of the adoption of the new lease standard included the recognition of right-of-use ("ROU") assets and lease liabilities. For the three months ended June 30, 2020 and 2020, the amortization was $9,652 and $10,027, respectively.

Operating leases are reflected on our balance sheet within ROU assets and the related current operating lease liabilities. ROU assets represent the right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make lease payments arising from the lease agreement. ROU assets and liabilities are recognized at the commencement date, or the date on which the lessor makes the underlying asset available for use, based upon the present value of the lease payments over the respective lease term. Lease expense is recognized on a straight-line basis over the lease term, subject to any changes in the lease or expectation regarding the terms.

As of June 30, 2020, the Company has the following amounts recorded on the Company's unaudited condensed consolidated balance sheet:

	As of June 30, 2020
	(Unaudited)
Assets
Right-of-use asset(non-current)	$	16,124
Total	$	16,124
Liabilities
Lease liability(current)	$	18,682
Total	$	18,682

Office lease:
Remaining Lease Term	1 year, renewal option
Incremental borrowing rate		4.9	%

The components of lease expense were as follows:

	For the three months ended June 30, 2020
	(Unaudited)
Amortization of ROU Asset
Office Lease	$	9,652
Interest expense		-
Total lease expense	$	9,652

Future annual minimum lease payments for non-cancellable operating leases are as follows:

Year Ending March 31	Operating Leases (Unaudited)
2021	$	18,638
Thereafter		-
Total		18,638
Less: imputed interest		-
Total	$	18,638
Reconciliation to lease liabilities:
Lease liabilities - current		18,638
Lease Liabilities	$	18,638

XML

Contingencies

3 Months Ended

Jun. 30, 2020

Commitments and Contingencies Disclosure [Abstract]

CONTINGENCIES

NOTE 10. CONTINGENCIES

Loss contingencies considered to be remote by management are generally not disclosed unless they involve guarantees, in which case the guarantee would be disclosed.

The Company was not subject to any material loss contingencies as of June 30, 2020 or March 31, 2020 and through the date of this report. 

XML

Subsequent Events

3 Months Ended

Jun. 30, 2020

Subsequent Events [Abstract]

SUBSEQUENT EVENTS

NOTE 11. SUBSEQUENT EVENTS

During the period from July 1, 2020 to the date of filling this report, the Company received an advance of $91,500 for the sale of 60,000 shares to be issued.

The COVID-19 outbreak has had a significant adverse impact and created many uncertainties related to our business, and we expect that it will continue to do so. The Company is experiencing challenges in sales and has suffered a significant decrease in revenues which has increased financial uncertainty. Our future business outlook and expectations are very uncertain due to the impact of the COVID-19 outbreak and are very difficult to quantify. It is difficult to assess or predict the impact of this unprecedented event on our business, financial results or financial condition. Factors that will impact the extent to which the COVID-19 outbreak affects our business, financial results and financial condition include: the duration, spread and severity of the outbreak; the actions taken to contain the virus or treat its impact, including government actions to mitigate the economic impact of the outbreak; and how quickly and to what extent normal economic and operating conditions can resume, including whether any future outbreaks interrupt economic recovery.

The Management of the Company determined that there were no other reportable subsequent events to be adjusted for and/or disclosed as of the date of filing this report.

XML

Summary of Significant Accounting Policies (Policies)

3 Months Ended

Jun. 30, 2020

Accounting Policies [Abstract]

Going concern

Going concern

Management has determined there is substantial doubt about our ability to continue as a going concern as a result of our lack of significant revenues and recurring losses. If we are unable to generate significant revenue or secure additional financing, we may be required to cease or curtail our operations. Our financial statements do not include adjustments that might result from the outcome of this uncertainty.

The Company's operations have been financed primarily by proceeds from sales of shares. The Company received $46,400 during the three months ended June 30, 2020, and an additional $91,500 from June 1, 2020 to the date of filling this report, from the sale of shares. These funds provided sufficient working capital for the Company.

Management intends to expand product offerings to include value-added products, both products based on rice and products based on other food stuffs, such as organic red beans and millet.

The marketing personnel of the Company will endeavor to expand awareness of our brand, open new marketing channels, and educate the nation about the health benefits of selenium-enriched rice.

In this manner, Management hopes to make sufficient operating cash inflow to support its future operations and development of the Company in addition to capital raised from sales of shares and shareholders' support based on needs.

Basis of presentation

Basis of presentation

The accompanying consolidated financial statements have been prepared on the accrual basis of accounting. All significant intercompany accounts and transactions have been eliminated in consolidation when applicable.

The Company's consolidated financial statements are expressed in U.S. Dollars and are presented in accordance with Accounting Principles Generally Accepted in the United States of America ("U.S. GAAP").

Principles of consolidation

Principles of consolidation

The consolidated financial statements include the accounts of the Company and its subsidiaries. All significant inter-company accounts and transactions have been eliminated in consolidation. The consolidated financial statements include the assets, liabilities, and net income or loss of these subsidiaries.

The Company's subsidiaries as of June 30, 2020 are listed as follows:

Name	Place of Incorporation	Attributable equity interest %		Authorized capital
Organic Agricultural (Samoa) Co., Ltd.	Samoa		100	USD	1,000,000
Organic Agricultural Company Limited (Hong Kong)	Hong Kong		100	HKD	10,000
Heilongjiang Tianci Liangtian Agricultural Technology Development Company Limited	China		100		0
Heilongjiang Yuxinqi Agricultural Technology Development Company Limited	China		100		0

Use of estimates

Use of estimates

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting periods. Management makes these estimates using the best information available at the time the estimates are made; however, actual results could differ from those estimates. One significant item subject to such estimates and assumptions is the inventory valuation allowance. These estimates are often based on complex judgments and assumptions that management believes to be reasonable but are inherently uncertain and unpredictable. Actual results could differ from these estimates.

Cash and cash equivalents

Cash and cash equivalents

Cash consists of cash on hand and bank deposits, which are unrestricted as to withdrawal and use. All highly liquid investments with original stated maturities of three months or less are classified as cash and cash equivalents. The Company's cash and cash equivalents consist of cash on hand and cash in bank, as of June 30, 2020 and March 31, 2020.

Revenue recognition

Revenue recognition

Effective April 1, 2018, the Company adopted Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 606 — Revenue from Contracts with Customers. Under ASC 606, the Company recognizes revenue from the commercial sales of products and contracts by applying the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied.

The Company recognizes revenue when the amount of revenue can be reliably measured, it is probable that economic benefits will flow to the entity, and specific criteria have been met for each of the Company's activities as described below.

The Company sells paddy and selenium-enriched paddy products, rice and other agricultural products. All revenue is recognized when it is both earned and realized. The Company's policy is to recognize the sale when the products, ownership and risk of loss have transferred to the purchasers, and collection of the sales proceeds, if not prepaid, is reasonably assured, all of which generally occur when the customer receives the products. Accordingly, revenue is recognized at the point in time when delivery is made.

Given the nature of this revenue source of the Company's business and the applicable rules guiding revenue recognition, the revenue recognition practices for the sale do not contain estimates that materially affect results of operations nor does the Company have any policy for return of products.

Fair value measurements

Fair value measurements

The Company applies the provisions of FASB ASC 820, Fair Value Measurements for fair value measurements of financial assets and financial liabilities and for fair value measurements of nonfinancial items that are recognized or disclosed at fair value in the financial statements. ASC 820 also establishes a framework for measuring fair value and expands disclosures about fair value measurements.

Fair value is defined as the price that would be received when selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In determining the fair value for the assets and liabilities required or permitted to be recorded, the Company considers the principal or most advantageous market in which it would transact, and it considers assumptions that market participants would use when pricing the asset or liability.

ASC 820 establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes three levels of inputs that may be used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to measurements involving significant unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows:

Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;

Level 2: Quoted prices, other than those in Level 1, in markets that are not active or for similar assets and liabilities, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability;

Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity).

There were no transfers between level 1, level 2 or level 3 measurements during the three months ended June 30, 2020 and 2019.

Financial assets and liabilities of the Company primarily consists of cash, account receivables, prepaid expenses, inventories, other receivables, accounts payable and accrued liabilities, customer deposits, due to related parties, and other payables. As at June 30, 2020 and March 31, 2020, the carrying values of these financial instruments approximated their fair values due to the short-term nature of these instruments.

Functional currency and foreign currency translation

Functional currency and foreign currency translation

An entity's functional currency is the currency of the primary economic environment in which it operates. Normally that is the currency of the environment in which the entity primarily generates and expends cash. Management's judgment is essential to determine the functional currency by assessing various indicators, such as cash flows, sales price and market, expenses, financing and inter-company transactions and arrangements. The functional currency of the Company is the Chinese Renminbi ("RMB'), except the functional currency of Organic Agricultural HK is the Hong Kong Dollar ("HKD"), and the functional currency of Organic Agricultural Samoa and Organic Agricultural is the United States dollar ("US Dollars" "USD" or "$"). The reporting currency of these consolidated financial statements is in US Dollars. 

The financial statements of the Company, which are prepared using the RMB and the HKD, are translated into the Company's reporting currency, the US Dollar. Assets and liabilities are translated using the exchange rate at each reporting period end date. Revenue and expenses are translated using average rates prevailing during each reporting period, and shareholders' equity is translated at historical exchange rates. Adjustments resulting from the translation are recorded as a separate component of accumulated other comprehensive income or loss.

Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transactions. Foreign currency exchange gains and losses resulting from these transactions are included in operations.

The exchange rates used for foreign currency translation are as follows: 

		For the three months ended   June 30,		March 31,
		2020	2019	2020
		(USD to RMB/USD to HKD)	(USD to RMB/USD to HKD)	(USD to RMB/USD to HKD)
Assets and liabilities	period end exchange rate	7.0697/7.7504	6.8656/7.8119	7.0896/7.7529
Revenue and expenses	period average	7.0864/7.7514	6.8210/7.8396	N/A

Income taxes

Income taxes

The Company follows FASB ASC Topic 740, Income Taxes, which requires the recognition of deferred income taxes for the differences between the basis of assets and liabilities for financial statements and income tax purposes. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Deferred tax assets are also recognized for operating losses and for tax credit carryforwards. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

ASC 740-10-30 requires income tax positions to meet a more-likely-than-not recognition threshold to be recognized in the financial statements. Under ASC 740-10-30, tax positions that previously failed to meet the more-likely-than-not threshold should be recognized in the first subsequent financial reporting period in which that threshold is met. Under ASC 740-10-40, previously recognized tax positions that no longer meet the more-likely-than-not threshold should be derecognized in the first subsequent financial reporting period in which that threshold is no longer met.

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

According to the "PRC Income Tax Law", Tianci Liantian and Yuxinqi are subject to a 25% standard enterprise income tax in the PRC.

Earnings (loss) per share

Earnings (loss) per share

The Company computes earnings (loss) per share ("EPS") in accordance with FASB ASC 260, Earnings Per Share. ASC 260 requires companies with complex capital structures to present basic and diluted EPS. Basic EPS is measured as net income (loss) divided by the weighted average common shares outstanding during the period.

Diluted EPS is similar to basic EPS but presents the dilutive effect on a per share basis of contracts to issue ordinary common shares (e.g., convertible securities, options and warrants) as if they had been converted at the beginning of the periods presented, or issuance date, if later. The computation of diluted EPS includes the estimated impact of the exercise of contracts to purchase common stock using the treasury stock method and the potential common shares associated with convertible debt using the if-converted method. Potential common shares that have an anti-dilutive effect (i.e., those that increase earnings per share or decrease loss per share) are excluded from the calculation of diluted EPS.

Share-based compensation

Share-based compensation

The Company follows the provisions of FASB ASC 718 requiring employee equity awards to be accounted for under the fair value method. Accordingly, share-based compensation is measured at grant date, based on the fair value of the award and recognized over its vesting period. No equity instruments were granted during the three months ended June, 2020 and 2019, and no compensation expense is required to be recognized under provisions of ASC 718 with respect to employees.

Segment information and geographic data

Segment information and geographic data

The Company is operating in one segment in accordance with the accounting guidance in FASB ASC Topic 280, Segment Reporting. The Company's revenues are from the sales of agricultural products to customers in the People's Republic of China ("PRC"). All assets of the Company are located in the PRC.

Concentration of credit risk

Concentration of credit risk

The Company maintains cash balances in three banks in China. In China, the insurance coverage of each bank is RMB500,000 (approximately USD$71,000). As of June 30, 2020, the Company had RMB1,281,670 (approximately USD$181,000) in excess of the insurance amounts.

During the three months ended June 30, 2020, major customers Shouhang Commerce & Trade and Jiufu Zhenyuan generated 49% and 49% of revenue, respectively. During the three months ended June 30, 2019, major customer Shouhang Commerce & Trade generated 97% of revenue, respectively.

Recently adopted accounting standards

Recently adopted accounting standards

Leases

In July 2018, the FASB issued ASU No. 2018-11, Leases (Topic 842): Targeted Improvements, which provides an additional, optional transition method related to implementing the new leases standard. ASU 2018-11 provides that companies can initially apply the new lease standard at adoption and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. The Company adopted the guidance as of April 1, 2019, there is no cumulative-effect adjustment to the Company's opening balance of retained earnings in the period of adoption. See Note 9 - Leases for further details.

We do not believe any recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on the condensed consolidated financial position, statements of operations and cash flows.

XML

Summary of Significant Accounting Policies (Tables)

3 Months Ended

Jun. 30, 2020

Accounting Policies [Abstract]

Schedule of company's subsidiaries

Name	Place of Incorporation	Attributable equity interest %		Authorized capital
Organic Agricultural (Samoa) Co., Ltd.	Samoa		100	USD	1,000,000
Organic Agricultural Company Limited (Hong Kong)	Hong Kong		100	HKD	10,000
Heilongjiang Tianci Liangtian Agricultural Technology Development Company Limited	China		100		0
Heilongjiang Yuxinqi Agricultural Technology Development Company Limited	China		100		0

Schedule of exchange rates used for foreign currency translation

		For the three months ended   June 30,		March 31,
		2020	2019	2020
		(USD to RMB/USD to HKD)	(USD to RMB/USD to HKD)	(USD to RMB/USD to HKD)
Assets and liabilities	period end exchange rate	7.0697/7.7504	6.8656/7.8119	7.0896/7.7529
Revenue and expenses	period average	7.0864/7.7514	6.8210/7.8396	N/A

XML

Discontinued Operations (Tables)

3 Months Ended

Jun. 30, 2020

Discontinued Operations [Abstract]

Schedule of income (loss) from discontinued operations

	Three months ended
	June 30, 2020		June 30, 2019
	(Unaudited)		(Unaudited)
Net sales	$	37,317	$	114,964
Cost of sales		36,574		122,401
Gross profit		743		(7,437	)
Selling, general and administrative expenses		-		395
Operating income (loss)		743		(7,832	)
Other income		-		440
Income (loss) before income taxes		743		(7,392	)
Income tax (expense) benefit		-		-
Income (loss) from discontinued operations, net of income taxes		743		(7,392	)
Less: Net income (loss) attributable to non-controlling interest		364		(3,622	)
Net income (loss) from discontinued operations attributable to controlling interest	$	379	$	(3,770	)

Schedule of liabilities of discontinued operations

	March 31, 2020
ASSETS
Cash and cash equivalents	$	1,340
Inventories, net		557,085
Total current assets, discontinued operations		558,425
Operating lease right-of-use assets		1,981,547
Total non-current assets, discontinued operations	$	2,539,972
LIABILITIES
Due to related parties	$	37,146
Operating lease liabilities (current)		298,259
Total current liabilities, discontinued operations		335,405
Operating lease liabilities (non-current)		1,424,600
Total non-current liabilities, discontinued operations	$	1,760,005

XML

Inventories (Tables)

3 Months Ended

Jun. 30, 2020

Inventory Disclosure [Abstract]

Schedule of inventories

	June 30		March 31
	2020		2020
	(Unaudited)
Rice and other products		13,480		41,153
Packing and other materials		12,856		15,457
Total inventories at cost		26,336		56,610

XML

Income Taxes (Tables)

3 Months Ended

Jun. 30, 2020

Income Tax Disclosure [Abstract]

Schedule of income (loss) before income taxes

	For the three months ended June 30
	2020			2019
	(Unaudited)			(Unaudited)
United States	$	(16,580	)	$	(25,066	)
Foreign		(957,532	)		(86,171	)
(Loss) before income taxes	$	(974,112	)	$	(111,237	)

Schedule of difference between the U.S. federal statutory income tax rate and the company's effective tax rate

	June 30,			June 30,
	2020			2019
	(Unaudited)			(Unaudited)
U.S. federal statutory income tax rate		21	%		21	%
U.S. Valuation allowance		(21	)%		(21	)%
Rates for Tianci Liangtian and Yuxinqi, net		25	%		25	%
PRC Valuation allowance		(25	)%		(25	)%
The Company's effective tax rate		(0	)%		(0	)%

Schedule of earliest tax year that remain subject to examination by major jurisdiction

	The year as of
U.S. Federal	March 31, 2019
China	March 31, 2018

XML

Other Payables (Tables)

3 Months Ended

Jun. 30, 2020

Payables and Accruals [Abstract]

Schedule of other payables

	June 30		March 31
	2020		2020
	(Unaudited)
Advances for shares to be issued	$	667		8,167
Others		229		244
	$	896	$	8,411

XML

Related Party Transactions (Tables)

3 Months Ended

Jun. 30, 2020

Related Party Transactions [Abstract]

Schedule of amount due to related parties

	June 30,		March 31
	2020		2020
	(Unaudited)
Hao Shuping	$	-	$	38,874
Shen Zhenai		36,639		37,647
Xun Jianjun		7,788		7,767
	$	44,427	$	84,288

Schedule of amounts due from related parties

	June 30,		March 31
	2020		2020
	(Unaudited)
Hao Shuping	$	3,442	$	-
	$	3,442	$	-

XML

Right-of-Use Assets and Lease Liabilities (Tables)

3 Months Ended

Jun. 30, 2020

Right-of-Use Assets And Lease Liabilities [Abstract]

Schedule of Unaudited condensed consolidated balance sheet

	As of June 30, 2020
	(Unaudited)
Assets
Right-of-use asset(non-current)	$	16,124
Total	$	16,124
Liabilities
Lease liability(current)	$	18,682
Total	$	18,682

Schedule of lease term

Office lease:
Remaining Lease Term	1 year, renewal option
Incremental borrowing rate		4.9	%

Schedule of components of lease expense

	For the three months ended June 30, 2020
	(Unaudited)
Amortization of ROU Asset
Office Lease	$	9,652
Interest expense		-
Total lease expense	$	9,652

Schedule of Future annual minimum lease payments

Year Ending March 31	Operating Leases (Unaudited)
2021	$	18,638
Thereafter		-
Total		18,638
Less: imputed interest		-
Total	$	18,638
Reconciliation to lease liabilities:
Lease liabilities - current		18,638
Lease Liabilities	$	18,638

XML

Nature of Operations and Basis of Presentation (Details)			1 Months Ended
	May 16, 2018 $ / shares shares	Mar. 31, 2017 USD ($) shares	Apr. 24, 2020 USD ($)	Apr. 24, 2020 CNY (¥)	Jan. 02, 2018	Mar. 31, 2017 CNY (¥)
Equity Transfer Agreement [Member]
Nature of Operations and Basis of Presentation (Textual)
Debt amount			$ 36,380
Equity Transfer Agreement [Member] | RMB [Member]
Nature of Operations and Basis of Presentation (Textual)
Debt amount | ¥				¥ 257,731
Hao Shuping [Member] | Equity Transfer Agreement [Member]
Nature of Operations and Basis of Presentation (Textual)
Percentage of equity interest acquired		51.00%				51.00%
Cash		$ 305,472
Number of share issue | shares		152,736
Value of share issue		$ 152,736
Hao Shuping [Member] | Equity Transfer Agreement [Member] | RMB [Member]
Nature of Operations and Basis of Presentation (Textual)
Cash | ¥						¥ 2,029,586
Tianci Liangtian [Member] | Equity Transfer Agreement [Member]
Nature of Operations and Basis of Presentation (Textual)
Percentage of equity interest acquired			51.00%	51.00%
Debt amount			$ 518,321
Nature of operations and basis of presentation, description			In exchange for the 51% interest in Lvxin, Lou Zhengui assumed the obligation to satisfy a debt of 300,000 RMB (approx. US$42,350) owed by Tianci Liangtian to Hao Shuping, a member of the Registrant’s Board of Directors.	In exchange for the 51% interest in Lvxin, Lou Zhengui assumed the obligation to satisfy a debt of 300,000 RMB (approx. US$42,350) owed by Tianci Liangtian to Hao Shuping, a member of the Registrant’s Board of Directors.
Tianci Liangtian [Member] | Equity Transfer Agreement [Member] | RMB [Member]
Nature of Operations and Basis of Presentation (Textual)
Debt amount | ¥				¥ 3,672,002
Organic Agricultural Co., Ltd [Member]
Nature of Operations and Basis of Presentation (Textual)
Percentage of equity interest acquired	48.80%
Common stock (in dollars per share) | $ / shares	$ 0.001
Percentage of exchange outstanding share	100.00%
Common stock issued | shares	10,000,000
Heilongjiang Tianci Liangtian Agricultural Technology Development Company Limited [Member] | Hao Shuping [Member] | Equity Transfer Agreement [Member]
Nature of Operations and Basis of Presentation (Textual)
Percentage of equity interest acquired					51.00%

XML

Summary of Significant Accounting Policies (Details) - shares	3 Months Ended
	Jun. 30, 2020	Mar. 31, 2020
Organic Agricultural (Samoa) Co., Ltd. [Member]
Place of Incorporation	Samoa
Attributable equity interest	100.00%
Authorized capital		1,000,000
Organic Agricultural Company Limited [Member] | HKD
Place of Incorporation	Hong Kong
Attributable equity interest	100.00%
Authorized capital		10,000
Heilongjiang Tianci Liangtian Agricultural Technology Development Company Limited [Member]
Place of Incorporation	China
Attributable equity interest	100.00%
Authorized capital		0
Heilongjiang Yuxinqi Agricultural Technology Development Company Limited [Member]
Place of Incorporation	China
Attributable equity interest	100.00%
Authorized capital		0

XML

Summary of Significant Accounting Policies (Details 1)	3 Months Ended
	Jun. 30, 2020	Mar. 31, 2020	Jun. 30, 2019
Assets and liabilities [Member]
Description of foreign currency translation	period end exchange rate		period end exchange rate
Assets and liabilities [Member] | RMB [Member]
Foreign currency translation	7.0697	7.0896	6.8656
Assets and liabilities [Member] | HKD
Foreign currency translation	7.7504	7.7529	7.8119
Revenue and expenses [Member]
Description of foreign currency translation	period average
Revenue and expenses [Member] | RMB [Member]
Foreign currency translation	7.0864		6.8210
Revenue and expenses [Member] | HKD
Foreign currency translation	7.7514		7.8396

XML

Summary of Significant Accounting Policies (Details Textual)	1 Months Ended	3 Months Ended
	Jul. 01, 2020 USD ($)	Jun. 30, 2020 USD ($)	Jun. 30, 2019	Jun. 30, 2020 CNY (¥)
Summary of Significant Accounting Policies (Textual)
Insurance coverage		$ 71,000
Excess of insurance amount		$ 181,000
Income tax rate		(0.00%)	0.00%
Received from sale of shares		$ 46,400
Subsequent Event [Member]
Summary of Significant Accounting Policies (Textual)
Received from sale of shares	$ 91,500
Zhao Shihai [Member]
Summary of Significant Accounting Policies (Textual)
Percentage of concentration risk		49.00%
Huiye Group [Member]
Summary of Significant Accounting Policies (Textual)
Percentage of concentration risk		49.00%
Shouhang Commerce and Trade [Member]
Summary of Significant Accounting Policies (Textual)
Percentage of concentration risk			97.00%
RMB [Member]
Summary of Significant Accounting Policies (Textual)
Insurance coverage | ¥				¥ 500,000
Excess of insurance amount | ¥				¥ 1,281,670
PRC [Member]
Summary of Significant Accounting Policies (Textual)
Income tax rate		25.00%

XML

Discontinued Operations (Details) - USD ($)	3 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
Discontinued Operations [Abstract]
Net sales	$ 37,317	$ 114,964
Cost of sales	36,574	122,401
Gross profit	743	(7,437)
Selling, general and administrative expenses		395
Operating income (loss)	743	(7,832)
Other income		440
Income (loss) before income taxes	743	(7,392)
Income tax (expense) benefit
Income (loss) from discontinued operations, net of income taxes	743	7,392
Less: Net income (loss) attributable to non-controlling interest	364	(3,622)
Net income (loss) from discontinued operations attributable to controlling interest	$ 379	$ (3,770)

XML

Discontinued Operations (Details 1) - USD ($)	Jun. 30, 2020	Mar. 31, 2020
ASSETS
Cash and cash equivalents		$ 1,340
Inventories, net		557,085
Total current assets, discontinued operations		558,425
Operating lease right-of-use assets		1,981,547
Total non-current assets, discontinued operations		2,539,972
LIABILITIES
Due to related parties		37,146
Operating lease liabilities (current)		298,259
Total current liabilities, discontinued operations		335,405
Operating lease liabilities (non-current)		1,424,600
Total non-current liabilities, discontinued operations		$ 1,760,005

XML

Prepaid Expenses (Details) - USD ($)	Jun. 30, 2020	Mar. 31, 2020
Prepaid Expenses (Textual)
Prepayments and deferred expenses	$ 63,124	$ 48,789

XML

Inventories (Details) - USD ($)	Jun. 30, 2020	Mar. 31, 2020
Total inventories at cost	$ 26,336	$ 56,610
Inventories, net	26,336	56,610
Rice and other products [Member]
Total inventories at cost	13,480	41,153
Packing and other materials [Member]
Total inventories at cost	$ 12,856	$ 15,457

XML

Income Taxes (Details) - USD ($)	3 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
Income Tax Disclosure [Abstract]
United States	$ (16,580)	$ (25,066)
Foreign	(957,532)	(86,171)
(Loss) before income taxes	$ (32,293)	$ (111,237)

XML

Income Taxes (Details 1)	3 Months Ended
	Jun. 30, 2020	Jun. 30, 2019
Income Tax Disclosure [Abstract]
U.S. federal statutory income tax rate	21.00%	21.00%
U.S. Valuation allowance	(21.00%)	(21.00%)
Rates for Tianci Liangtian and Yuxinqi, net	25.00%	25.00%
PRC Valuation allowance	(25.00%)	(25.00%)
The Company's effective tax rate	(0.00%)	0.00%

XML

Income Taxes (Details 2)	3 Months Ended
	Jun. 30, 2020
U.S. Federal [Member]
Tax examination date	Mar. 31, 2019
China [Member]
Tax examination date	Mar. 31, 2018

XML

Income Taxes (Details Textual) - USD ($)	3 Months Ended
	Jun. 30, 2020	Jun. 30, 2019	Mar. 31, 2020
Income Taxes (Textual)
Income tax rate	21.00%
Enterprise income tax	25.00%	25.00%
Tianci Liantian and Yuxinqi [Member]
Income Taxes (Textual)
Total operating loss carry forwards	$ 687,143
United States [Member]
Income Taxes (Textual)
Valuation allowance	$ 87,000		$ 83,000
Percentage of valuation allowance	100.00%
Incurred loss	$ 414,000
Valuation allowance increased	4,000	$ 5,000
PRC [Member]
Income Taxes (Textual)
Allowance on deferred tax assets	$ 171,786		$ 165,787
Percentage of allowance on all deferred tax assets	100.00%
Expire date	Dec. 31, 2024
Valuation allowance increased	$ 6,000	$ 18,000

XML

Other Payables (Details) - USD ($)	Jun. 30, 2020	Mar. 31, 2020
Payables and Accruals [Abstract]
Advances for shares to be issued	$ 667	$ 8,167
Others	229	244
Other payables	$ 896	$ 8,411

XML

Other Payables (Details Textual) - USD ($)	Jun. 30, 2020	Apr. 03, 2020	Mar. 31, 2020
Other Payables (Textual)
Advances for shares to be issued	$ 667
Sale of common shares received amount			$ 8,167
Refunded amount		$ 7,500

XML

Related Party Transactions (Details) - USD ($)	Jun. 30, 2020	Mar. 31, 2020
Amount due to related parties	$ 44,427	$ 84,288
Hao Shuping [Member]
Amount due to related parties		38,874
Shen Zhenai [Member]
Amount due to related parties	36,639	37,647
Xun Jianjun [Member]
Amount due to related parties	$ 7,788	$ 7,767

XML

Related Party Transactions (Details 1) - USD ($)	Jun. 30, 2020	Mar. 31, 2020
Amounts due from related parties	$ 3,442
Hao Shuping [Member]
Amounts due from related parties	$ 3,442

XML

Right-of-Use Assets and Lease Liabilities (Details) - USD ($)	Jun. 30, 2020	Mar. 31, 2020
Assets
Right-of-use asset(non-current)	$ 16,124	$ 25,727
Total	404,482	2,934,747
Liabilities
Total	225,145	$ 2,028,902
Parent [Member]
Assets
Right-of-use asset(non-current)	16,124
Total	16,124
Liabilities
Lease liability(current)	18,682
Total	$ 18,682

XML

Right-of-Use Assets and Lease Liabilities (Details 1) - Office lease: [Member]	3 Months Ended
	Jun. 30, 2020
Remaining Lease Term	1 year, renewal option
Incremental borrowing rate	4.90%

XML

Right-of-Use Assets and Lease Liabilities (Details 2)	3 Months Ended
	Jun. 30, 2020 USD ($)
Amortization of ROU Asset
Office Lease	$ 9,652
Interest expense
Total lease expense	$ 9,652

XML

Right-of-Use Assets and Lease Liabilities (Details 3) - USD ($)	Jun. 30, 2020	Mar. 31, 2020
Total	$ 225,145	$ 2,028,902
Reconciliation to lease liabilities:
Total liabilities	225,145	$ 2,028,902
Operating Leases [Member]
2021	18,638
Thereafter
Total	18,638
Less: imputed interest
Total	18,638
Reconciliation to lease liabilities:
Lease liabilities - current	18,638
Total liabilities	$ 18,638

XML

Right-of-Use Assets and Lease Liabilities (Details Textual)	1 Months Ended						3 Months Ended
	Dec. 23, 2019 USD ($)	Dec. 23, 2019 CNY (¥)	Dec. 20, 2019 USD ($)	Dec. 20, 2019 CNY (¥)	Dec. 31, 2018 USD ($)	Dec. 31, 2018 CNY (¥)	Jun. 30, 2020 USD ($)	Jun. 30, 2019 USD ($)	Nov. 30, 2017 USD ($) m²
Right-of-Use Assets and Lease Liabilities (Textual)
Operating Lease Payments	$ 22,000
Right of use oerating lease assets							$ 16,124
Right of use operating lease liability							18,682
Amortization expenses							$ 9,652	$ 10,027
RMB [Member]
Right-of-Use Assets and Lease Liabilities (Textual)
Operating Lease Payments | ¥		¥ 150,000
Operating Lease Agreement [Member] | Tianci Liangtian [Member]
Right-of-Use Assets and Lease Liabilities (Textual)
Area of lease office | m²									666
Lease deposits									$ 1,592
Operating Lease Agreement [Member] | Heilongjiang Yuxinqi Agricultural Technology Development Company Limited [Member]
Right-of-Use Assets and Lease Liabilities (Textual)
Annual lease payments			$ 42,000		$ 42,000
Operating Lease Agreement [Member] | Heilongjiang Yuxinqi Agricultural Technology Development Company Limited [Member] | RMB [Member]
Right-of-Use Assets and Lease Liabilities (Textual)
Annual lease payments | ¥				¥ 290,000		¥ 290,000

XML

Subsequent Events (Details) - Subsequent Event [Member]	Jul. 02, 2020 USD ($) shares
Subsequent Events (Textual)
Advance for shares to issued, shares | shares	60,000
Advance for shares to issued, value | $	$ 91,500