0001477932-20-006436.txt : 20201112 0001477932-20-006436.hdr.sgml : 20201112 20201112142301 ACCESSION NUMBER: 0001477932-20-006436 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 44 CONFORMED PERIOD OF REPORT: 20200930 FILED AS OF DATE: 20201112 DATE AS OF CHANGE: 20201112 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Fovea Jewelry Holdings Ltd. CENTRAL INDEX KEY: 0000850971 STANDARD INDUSTRIAL CLASSIFICATION: WHOLESALE-JEWELRY, WATCHES, PRECIOUS STONES & METALS [5094] IRS NUMBER: 954202424 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-56156 FILM NUMBER: 201305768 BUSINESS ADDRESS: STREET 1: 30 N. GOULD ST. STREET 2: SUITE 2984 CITY: SHERIDAN STATE: WY ZIP: 82801 BUSINESS PHONE: 702-505-4599 MAIL ADDRESS: STREET 1: 30 N. GOULD ST. STREET 2: SUITE 2984 CITY: SHERIDAN STATE: WY ZIP: 82801 FORMER COMPANY: FORMER CONFORMED NAME: DYCAM INC DATE OF NAME CHANGE: 19940523 10-Q 1 fjhl_10q.htm FORM 10-Q fjhl_10q.htm

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

(MARK ONE)

 

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

 

For the quarterly period ended September 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 No. 000-56156

 

FOVEA JEWELRY HOLDINGS, LTD.

(Exact name of registrant as specified in its charter)

  

Wyoming

 

95-420242495

(State or other jurisdiction of

 

(I.R.S. Employer

incorporation or organization)

 

Identification No.)

 

Room 403, 4/F, Phase 1 Austin Tower

22-26A Austin Avenue

Tsim Sha Tsui, Hong Kong

(Address of principal executive offices, zip code)

 

+852 6847 6812

(Registrant’s telephone number, including area code)

_____________________________________________________

(Former name, former address and former fiscal year, if changed since last report)

 

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

 

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

 

 

 

 

Indicate by check mark whether the issuer (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 ☒     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 ☒     No ☐

 

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

 

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

 

 

Emerging growth company

 

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 Exchange Act Rule 12b-2 of the Exchange Act): Yes ☐     No ☒ 

 

APPLICABLE ONLY TO ISSUERS 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 Sections 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 ISSUERS

 

As of November 12, 2020, there were approximately 10,161,039 shares of common stock, $0.001 par value per share, outstanding.

 

 

 

  

FOVEA JEWELRY HOLDINGS, LTD.

QUARTERLY REPORT ON FORM 10-Q

FOR THE PERIOD ENDED SEPTEMBER 30, 2020

 

INDEX

 

Index

 

 

Page

 

 

 

 

 

 

Part I. Financial Information

 

 

 

 

 

 

Item 1.

Financial Statements

 

4

 

 

 

 

 

 

 

Condensed consolidated balance sheets at September 30, 2020 (Unaudited) and December 31, 2019.

 

4

 

 

 

 

 

 

 

Condensed consolidated statements of operations and comprehensive income for the three and nine months ended September 30, 2020 and 2019 (unaudited).

 

5

 

 

 

 

 

 

 

Condensed consolidated statements of cash flows for the nine months ended September 30, 2020 and 2019 (unaudited).

 

6

 

 

 

 

 

 

 

Condensed consolidated statements of changes in stockholders’ equity (deficit) for the three and nine months ended September 30, 2020 and 2019 (Unaudited).

 

7

 

 

 

 

 

 

 

Notes to Condensed Consolidated Financial Statements (unaudited).

 

8

 

 

 

 

 

 

Item 2.

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

 

18

 

 

 

 

 

 

Item 3.

Quantitative and Qualitative Disclosures About Market Risk.

 

22

 

 

 

 

 

 

Item 4.

Controls and Procedures.

 

22

 

 

 

 

 

 

Part II. Other Information

 

 

 

 

 

 

Item 1.

Legal Proceedings.

 

23

 

 

 

 

 

 

Item 1A.

Risk Factors

 

23

 

 

 

 

 

 

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds.

 

23

 

 

 

 

 

 

Item 3.

Defaults Upon Senior Securities.

 

23

 

 

 

 

 

 

Item 4.

Mine Safety Disclosures.

 

23

 

 

 

 

 

 

Item 5.

Other Information.

 

23

 

 

 

 

 

 

Item 6.

Exhibits.

 

24

 

 

 

 

 

 

Signatures

 

25

  

 
2

Table of Contents

  

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

This Quarterly Report on Form 10-Q of Fovea Jewelry Holdings, Ltd., a Nevada corporation (the “Company”), contains “forward-looking statements,” as defined in the United States Private Securities Litigation Reform Act of 1995. In some cases, you can identify forward-looking statements by terminology such as “may”, “will”, “should”, “could”, “expects”, “plans”, “intends”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of such terms and other comparable terminology. These forward-looking statements include, without limitation, statements about our market opportunity, our strategies, competition, expected activities and expenditures as we pursue our business plan, and the adequacy of our available cash resources. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Actual results may differ materially from the predictions discussed in these forward-looking statements. The economic environment within which we operate could materially affect our actual results. Additional factors that could materially affect these forward-looking statements and/or predictions include, among other things: the volatility of oil and gas prices, the possibility that equipment development efforts will not produces equipment that prospective customers want to purchase, the Company’s need for and ability to obtain additional financing, other factors over which we have little or no control; and other factors discussed in the Company’s filings with the Securities and Exchange Commission (“SEC”).

 

Our management has included projections and estimates in this Form 10-Q, which are based primarily on management’s experience in the industry, assessments of our results of operations, discussions and negotiations with third parties and a review of information filed by our competitors with the SEC or otherwise publicly available. We caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. We disclaim any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.

 

 
3

Table of Contents

 

PART I. FINANCIAL INFORMATION

 

ITEM 1. FINANCIAL STATEMENTS.

 

FOVEA JEWELRY HOLDINGS, LTD

CONDENSED CONSOLIDATED BALANCE SHEETS

AS OF SEPTEMBER 30, 2020 AND DECEMBER 31, 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

   

 

 

September

30, 2020

 

 

December

31, 2019

 

 

 

(Unaudited)

 

 

(Audited)

 

ASSETS

 

 

 

 

 

 

Current asset:

 

 

 

 

 

 

Accounts receivable

 

$ 543,639

 

 

$ -

 

Cash and cash equivalents

 

 

46,755

 

 

 

31,380

 

 

 

 

 

 

 

 

 

 

Total current assets

 

 

590,394

 

 

 

31,380

 

 

 

 

 

 

 

 

 

 

Non-current asset:

 

 

 

 

 

 

 

 

Plant and equipment

 

 

30,322

 

 

 

35,957

 

 

 

 

 

 

 

 

 

 

TOTAL ASSETS

 

$ 620,716

 

 

$ 67,337

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Accounts payable

 

$ 271,812

 

 

$ -

 

Accrued liabilities and other payables

 

 

19,935

 

 

 

30,643

 

Income tax payable

 

 

25,399

 

 

 

235

 

Deferred tax liabilities

 

 

2,502

 

 

 

5,933

 

Amount due to a director

 

 

2,062

 

 

 

-

 

 

 

 

 

 

 

 

 

 

Total current liabilities

 

 

321,710

 

 

 

36,811

 

 

 

 

 

 

 

 

 

 

TOTAL LIABILITIES

 

 

321,710

 

 

 

36,811

 

 

 

 

 

 

 

 

 

 

Commitments and contingencies

 

 

-

 

 

 

-

 

 

 

 

 

 

 

 

 

 

STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

Preferred stock, $0.001 par value; 5,000,000 shares authorized, no share issued and outstanding as of September 30, 2020 and December 31, 2019

 

 

-

 

 

 

-

 

Series A preferred stock, $0.001 par value, 1,000,000 shares designated; 1,000,000 issued and outstanding, as of September 30, 2020 and December 31, 2019, respectively

 

 

1,000

 

 

 

1,000

 

Common stock, $0.001 par value; 2,000,000,000 shares authorized; 10,161,039 and 10,161,039 shares issued and outstanding as of September 30, 2020 and December 31, 2019, respectively

 

 

10,161

 

 

 

10,161

 

Accumulated other comprehensive (loss) income

 

 

(15,656 )

 

 

369

 

Retained earnings

 

 

303,501

 

 

 

18,996

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity

 

 

299,006

 

 

 

30,526

 

 

 

 

 

 

 

 

 

 

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

 

$ 620,716

 

 

$ 67,337

 

 

## Post a 1-for-10,000 reverse stock split effective on March 6, 2020

 

See accompanying notes to condensed consolidated financial statements.

  

 
4

Table of Contents

 

FOVEA JEWELRY HOLDINGS, LTD

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”))

(Unaudited)

 

 

 

Three Months ended September 30,

 

 

Nine Months ended September 30,

 

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue, net

 

$ 542,900

 

 

$ 25,919

 

 

$ 942,965

 

 

$ 109,208

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of revenue

 

 

(271,443 )

 

 

(10,209 )

 

 

(604,566 )

 

 

(54,912 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross profit

 

 

271,457

 

 

 

15,710

 

 

 

338,399

 

 

 

54,296

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative expenses

 

 

(8,630 )

 

 

(5,989 )

 

 

(32,220 )

 

 

(8,667 )

Total operating expenses

 

 

(8,630 )

 

 

(5,989 )

 

 

(32,220 )

 

 

(8,667 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

INCOME BEFORE INCOME TAXES

 

 

262,827

 

 

 

9,721

 

 

 

306,179

 

 

 

45,629

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax expenses

 

 

(22,312 )

 

 

(6,204 )

 

 

(21,674 )

 

 

(6,204 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET INCOME

 

 

240,515

 

 

 

3,517

 

 

 

284,505

 

 

 

39,425

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other comprehensive income (loss):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

– Foreign currency adjustment gain (loss)

 

 

326

 

 

 

(161 )

 

 

(16,025 )

 

 

(20 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

COMPREHENSIVE INCOME

 

$ 240,841

 

 

$ 3,356

 

 

$ 268,480

 

 

$ 39,405

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income per share – Basic and Diluted

 

$ 0.02

 

 

$ 0.00

 

 

$ 0.03

 

 

$ 0.00

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

– Basic and Diluted

 

 

10,161,039

 

 

 

10,161,039

 

 

 

10,161,039

 

 

 

10,161,039

 

      

## Post a 1-for-10,000 reverse stock split effective on March 6, 2020

  

See accompanying notes to condensed consolidated financial statements.

 

 
5

Table of Contents

 

FOVEA JEWELRY HOLDINGS, LTD

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”))

(Unaudited)

 

 

 

Nine months ended September 30,

 

 

 

2020

 

 

2019

 

 

 

 

 

 

 

 

Cash flow from operating activities:

 

 

 

 

 

 

Net income

 

$ 284,505

 

 

$ 39,425

 

Adjustments to reconcile net income to net cash generated from operating activities:

 

 

 

 

 

 

 

 

Depreciation of plant and equipment

 

 

5,798

 

 

 

637

 

 

 

 

 

 

 

 

 

 

Change in operating assets and liabilities:

 

 

 

 

 

 

 

 

Accounts receivable

 

 

(543,639 )

 

 

-

 

Deferred tax liabilities

 

 

(3,431 )

 

 

6,204

 

Tax payable

 

 

25,164

 

 

 

-

 

Accounts payable

 

 

271,812

 

 

 

-

 

Accrued liabilities and other payables

 

 

(10,708 )

 

 

-

 

Net cash provided by operating activities

 

 

29,501

 

 

 

46,266

 

 

 

 

 

 

 

 

 

 

Cash flow from investing activities:

 

 

 

 

 

 

 

 

Purchase of property, plant and equipment

 

 

-

 

 

 

(38,220 )

Net cash used in investing activities

 

 

-

 

 

 

(38,220 )

 

 

 

 

 

 

 

 

 

Cash flow from financing activities:

 

 

 

 

 

 

 

 

Amount due to a director

 

 

2,062

 

 

 

-

 

Net cash provided by financing activities

 

 

2,062

 

 

 

-

 

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustment

 

 

(16,188 )

 

 

(23 )

 

 

 

 

 

 

 

 

 

Net change in cash and cash equivalents

 

 

15,375

 

 

 

8,023

 

 

 

 

 

 

 

 

 

 

BEGINNING OF PERIOD

 

 

31,380

 

 

 

100

 

 

 

 

 

 

 

 

 

 

END OF PERIOD

 

$ 46,755

 

 

$ 8,123

 

 

 

 

 

 

 

 

 

 

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

 

 

Cash paid for income taxes

 

$ -

 

 

$ -

 

Cash paid for interest

 

$ -

 

 

$ -

 

    

See accompanying notes to condensed consolidated financial statements.

 

 
6

Table of Contents

 

FOVEA JEWELRY HOLDINGS, LTD

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

 

 

 

Series A preferred stock

 

 

Common stock

 

 

Accumulated other comprehensive

 

 

(Accumulated

losses)

retained

 

 

Total

stockholders’

(deficit)

 

 

 

No. of shares

 

 

Amount

 

 

No. of shares

 

 

Amount

 

 

 income (loss)

earnings

equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance as of January 1, 2019

 

 

1,000,000

 

 

$ 1,000

 

 

 

10,161,039

 

 

$ 10,161

 

 

$ -

 

 

$ (18,704 )

 

$ (7,543 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustment

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Net income for the period

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance as of March 31, 2019

 

 

1,000,000

 

 

 

1,000

 

 

 

10,161,039

 

 

 

10,161

 

 

 

-

 

 

 

(18,704 )

 

 

(7,543 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustment

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

141

 

 

 

-

 

 

 

141

 

Net income for the period

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

35,908

 

 

 

35,908

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance as of June 30, 2019

 

 

1,000,000

 

 

$ 1,000

 

 

 

10,161,039

 

 

$ 10,161

 

 

$ 141

 

 

$ 17,204

 

 

$ 28,506

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustment

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(161 )

 

 

-

 

 

 

(161 )

Net income for the period

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

3,517

 

 

 

3,517

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance as of September 30, 2019

 

 

1,000,000

 

 

$ 1,000

 

 

 

10,161,039

 

 

$ 10,161

 

 

$ (20 )

 

$ 20,721

 

 

$ 31,862

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance as of January 1, 2020

 

 

1,000,000

 

 

$ 1,000

 

 

 

10,161,039

 

 

$ 10,161

 

 

$ 369

 

 

$ 18,996

 

 

$ 30,526

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustment

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(17,977 )

 

 

-

 

 

 

(17,977 )

Net income for the period

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

13,510

 

 

 

13,510

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance as of March 31, 2020

 

 

1,000,000

 

 

 

1,000

 

 

 

10,161,039

 

 

 

10,161

 

 

 

(17,608 )

 

 

32,506

 

 

 

26,059

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustment

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,626

 

 

 

-

 

 

 

1,626

 

Net income for the period

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

30,480

 

 

 

30,480

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance as of June 30, 2020

 

 

1,000,000

 

 

$ 1,000

 

 

 

10,161,039

 

 

$ 10,161

 

 

$ (15,982 )

 

$ 62,986

 

 

$ 58,165

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustment

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

326

 

 

 

-

 

 

 

326

 

Net income for the period

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

240,515

 

 

 

240,515

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance as of September 30, 2020

 

 

1,000,000

 

 

$ 1,000

 

 

 

10,161,039

 

 

$ 10,161

 

 

$ (15,656 )

 

$ 303,501

 

 

$ 299,006

 

 

## Post a 1-for-10,000 reverse stock split effective on March 6, 2020

 

See accompanying notes to consolidated financial statements.

 

 
7

Table of Contents

 

FOVEA JEWELRY HOLDINGS, LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

 

NOTE 1 - DESCRIPTION OF BUSINESS AND ORGANIZATION

 

Fovea Jewelry Holdings, Ltd (the “Company” or “FJHL”) was originally founded on February 1, 2006 as Dycam, Inc. In March 2006, the Company changed its name to Mekju Processing, Inc. In November 2006, the Company changed its name to Auxium Technologies, Inc. In November 2014, the Company changed its name to Pure Hospitality Solutions, Inc. On November 2, 2015, the Company changed its name to Wincash Resources, Inc. In early 2018, the Board of Directors of the Company deemed it in the best interests of the Company and its shareholders to switch directions and become involved in the business of the collection and ultimately the sale of diamond jewelry.

 

Effective September 26, 2018, the Company changed its name from Wincash Resources, Inc. to Fovea Jewelry Holdings, Ltd. The Financial Industry Regulatory Authority and the OTC Markets Group, Inc. recognized the name change on February 3, 2018. Further, in connection with changing its name, the Company changed its trading symbol to FJHL.

 

As a result of the change in business, the Company redomiciled from Nevada to Wyoming on March 4, 2019.

 

Currently, the Company through its subsidiaries, mainly commenced to operate an online store to sell the quality jewelry at affordable prices on www.fovea-jewellery.com. The goal is to “Deliver A Better Living”. All products selling on the online store are with great quality, natural, socially responsible and niche. This business was commenced its operation in Hong Kong from January 1, 2019.

 

On March 6, 2020, the Company approved by the state government of Wyoming and effectuated a 1 for 10,000 reverse stock split. The number of authorized shares remains unchanged. All share and per share information in this financial statements and footnotes have been retroactively adjusted for all periods presented, unless otherwise indicated, to give effect to the reverse stock split.

 

On March 20, 2020, the Company consummated the Share Exchange Transaction among Gold Shiny International Limited (“GSIL”) and its shareholders. The Company acquired all of the issued and outstanding shares of GSIL from GSIL’s shareholders, in exchange for 10,000,000 shares of the issued and outstanding common stock. Upon completion of the Share Exchange Transaction, GSIL became a 100% owed subsidiary of the Company.

 

Prior to the acquisition, the Company was considered as a shell company due to its nominal assets and limited operation. Upon the acquisition, GSIL will comprise the ongoing operations of the combined entity, GSIL is deemed to be the accounting acquirer for accounting purposes. The transaction will be treated as a recapitalization of the Company. Accordingly, the consolidated assets, liabilities and results of operations of the Company will become the historical financial statements of GSIL, and the Company’s assets, liabilities and results of operations will be consolidated with GSIL beginning on the acquisition date. GSIL was the legal acquiree but deemed to be the accounting acquirer. The Company was the legal acquirer but deemed to be the accounting acquiree in the reverse merger. The historical financial statements prior to the acquisition are those of the accounting acquirer (GSIL). Historical stockholders’ equity of the accounting acquirer prior to the merger are retroactively restated (a recapitalization) for the equivalent number of shares received in the merger. Operations prior to the merger are those of the acquirer. After completion of the share exchange transaction, the Company’s consolidated financial statements include the assets and liabilities, the operations and cash flow of the accounting acquirer.

 

Description of subsidiaries

 

Name

 

Place of incorporation

and kind of

legal entity

 

Principal activities

and place of operation

 

Particulars of registered/ paid up share

capital

 

Effective interest

held

 

 

 

 

 

 

 

 

 

Fovea International Holdings Limited

 

British Virgin Islands

 

Investment holding

 

100 ordinary shares at par value of US$1

 

100%

 

 

 

 

 

 

 

 

 

Fovea Jewellery Holdings Limited

 

Hong Kong

 

Sales and marketing in Hong Kong

 

1 ordinary share for HK$1

 

100%

 

 

 

 

 

 

 

 

 

Gold Shiny International Limited

 

British Virgin Islands

 

Investment holding

 

115 ordinary shares at par value of US$1

 

100%

 

 

 

 

 

 

 

 

 

Gold Shiny (Asia) Limited

 

Hong Kong

 

Sales and marketing in Hong Kong

 

1 ordinary share for HK$1

 

100%

 

The Company and its subsidiaries are hereinafter referred to as (the “Company”).

 

 
8

Table of Contents

 

FOVEA JEWELRY HOLDINGS, LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

    

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

The accompanying condensed consolidated financial statements reflect the application of certain significant accounting policies as described in this note and elsewhere in the accompanying condensed consolidated financial statements and notes.

 

·

Basis of presentation

 

These accompanying condensed consolidated financial statements have been prepared in U.S. Dollars in conformity with generally accepted accounting principles in the United States of America (“U.S. GAAP”) for interim financial information pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary to make the financial statements not misleading have been included. Operating results for the interim period ended September 30, 2020 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2020. The information included in this Form 10-Q should be read in conjunction with Management’s Discussion and Analysis, and the financial statements and notes thereto included in the Company’s Form 10/A for the fiscal year ended December 31, 2019, filed with the SEC on May 1, 2020.

 

·

Use of estimates and assumptions

 

In preparing these condensed consolidated financial statements, management makes estimates and assumptions that affect the reported amounts of assets and liabilities in the balance sheet and revenues and expenses during the periods reported. Actual results may differ from these estimates.

 

·

Basis of consolidation

 

The condensed consolidated financial statements include the accounts of FJHL and its subsidiaries. All significant inter-company balances and transactions within the Company have been eliminated upon consolidation.

 

·

Cash and cash equivalents

 

Cash and cash equivalents are carried at cost and represent cash on hand, demand deposits placed with banks or other financial institutions and all highly liquid investments with an original maturity of three months or less as of the purchase date of such investments.

 

·

Accounts receivable

 

Accounts receivable are recorded at the invoiced amount and do not bear interest, which are due within contractual payment terms, generally 30 to 90 days from completion of service. Credit is extended based on evaluation of a customer’s financial condition, the customer credit-worthiness and their payment history. Accounts receivable outstanding longer than the contractual payment terms are considered past due. Past due balances over 90 days and over a specified amount are reviewed individually for collectibility. At the end of fiscal year, the Company specifically evaluates individual customer’s financial condition, credit history, and the current economic conditions to monitor the progress of the collection of accounts receivables. The Company will consider the allowance for doubtful accounts for any estimated losses resulting from the inability of its customers to make required payments. For the receivables that are past due or not being paid according to payment terms, the appropriate actions are taken to exhaust all means of collection, including seeking legal resolution in a court of law. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company does not have any off-balance-sheet credit exposure related to its customers. As of September 30, 2020, there was no allowance for doubtful accounts.

 

 
9

Table of Contents

 

FOVEA JEWELRY HOLDINGS, LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

    

·

Plant and equipment

 

Plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses, if any. Depreciation is calculated on the straight-line basis over the following expected useful lives from the date on which they become fully operational and after taking into account their estimated residual values:

 

 

 

Expected useful lives

 

Computer equipment

 

5 years

 

 

Expenditures for repairs and maintenance are expensed as incurred. When assets have been retired or sold, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in the results of operations.

 

Depreciation expense for the three months ended September 30, 2020 and 2019 were $1,932 and $637, respectively.

 

Depreciation expense for the nine months ended September 30, 2020 and 2019 were $5,798 and $637, respectively.

 

·

Revenue recognition

 

The Company adopted Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”) using the full retrospective transition method. The Company’s adoption of ASU 2014-09 did not have a material impact on the amount and timing of revenue recognized in its condensed consolidated financial statements.

 

Under ASU 2014-09, the Company recognizes revenue when control of the promised goods or services is transferred to customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services.

 

The Company applies the following five steps in order to determine the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its agreements:

 

identify the contract with a customer;

identify the performance obligations in the contract;

determine the transaction price;

allocate the transaction price to performance obligations in the contract; and

recognize revenue as the performance obligation is satisfied.

 

The Company records the revenue from the sale of jewelry and healthcare supplement products during the period.

 

·

Cost of revenue

 

Cost of revenue consists primarily of the cost of goods sold, which are directly attributable to the sales of products.

 

 
10

Table of Contents

  

FOVEA JEWELRY HOLDINGS, LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

    

·

Income taxes

 

The Company adopted the ASC 740 Income tax provisions of paragraph 740-10-25-13, which addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the condensed consolidated financial statements. Under paragraph 740-10-25-13, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the condensed consolidated financial statements from such a position should be measured based on the largest benefit that has a greater than fifty percent (50%) likelihood of being realized upon ultimate settlement. Paragraph 740-10-25-13 also provides guidance on de-recognition, classification, interest and penalties on income taxes, accounting in interim periods and requires increased disclosures. The Company had no material adjustments to its liabilities for unrecognized income tax benefits according to the provisions of paragraph 740-10-25-13.

 

The estimated future tax effects of temporary differences between the tax basis of assets and liabilities are reported in the accompanying balance sheets, as well as tax credit carry-backs and carry-forwards. The Company periodically reviews the recoverability of deferred tax assets recorded on its balance sheets and provides valuation allowances as management deems necessary.

 

·

Uncertain tax positions

 

The Company did not take any uncertain tax positions and had no adjustments to its income tax liabilities or benefits pursuant to the ASC 740 provisions of Section 740-10-25 for the three and nine months ended September 30, 2020 and 2019.

 

·

Foreign currencies translation

 

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 transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the condensed consolidated statement of operations.

 

The reporting currency of the Company is United States Dollar (“US$”) and the accompanying condensed consolidated financial statements have been expressed in US$. In addition, the Company is operating in Hong Kong and maintain its books and record in its local currency, Hong Kong Dollars (“HKD”), which is a functional currency as being the primary currency of the economic environment in which their operations are conducted. In general, for consolidation purposes, assets and liabilities of its subsidiary whose functional currency is not US$ are translated into US$, in accordance with ASC Topic 830-30, “ Translation of Financial Statement”, using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements of foreign subsidiary are recorded as a separate component of accumulated other comprehensive income within the statements of changes in stockholder’s equity.

 

Translation of amounts from HKD into US$ has been made at the following exchange rates for the period ended September 30, 2020 and 2019:

 

 

 

September

30, 2020

 

 

September

30, 2019

 

Period-end HKD:US$ exchange rate

 

 

0.12903

 

 

 

0.12740

 

Period average HKD:US$ exchange rate

 

 

0.12885

 

 

 

0.12746

 

 

 
11

Table of Contents

  

FOVEA JEWELRY HOLDINGS, LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

    

·

Comprehensive income

 

ASC Topic 220, “Comprehensive Income”, establishes standards for reporting and display of comprehensive income, its components and accumulated balances. Comprehensive income as defined includes all changes in equity during a period from non-owner sources. Accumulated other comprehensive income, as presented in the accompanying condensed consolidated statements of changes in stockholders’ equity, consists of changes in unrealized gains and losses on foreign currency translation. This comprehensive income is not included in the computation of income tax expense or benefit.

 

·

Segment reporting

 

ASC Topic 280, “Segment Reporting” establishes standards for reporting information about operating segments on a basis consistent with the Company’s internal organization structure as well as information about geographical areas, business segments and major customers in condensed consolidated financial statements. For the period ended September 30, 2020 and 2019, the Company operates in one reportable operating segment in Hong Kong.

 

·

Related parties

 

The Company follows the ASC 850-10, Related Party for the identification of related parties and disclosure of related party transactions.

 

Pursuant to section 850-10-20 the related parties include a) affiliates of the Company; b) entities for which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of section 825–10–15, to be accounted for by the equity method by the investing entity; c) trusts for the benefit of employees, such as pension and Income-sharing trusts that are managed by or under the trusteeship of management; d) principal owners of the Company; e) management of the Company; f) other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests; and g) other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests.

 

The condensed consolidated financial statements shall include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business. However, disclosure of transactions that are eliminated in the preparation of consolidated or combined financial statements is not required in those statements. The disclosures shall include: a) the nature of the relationship(s) involved; b) a description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which income statements are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the financial statements; c) the dollar amounts of transactions for each of the periods for which income statements are presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and d) amount due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement.

 

·

Commitments and contingencies

  

The Company follows the ASC 450-20, Commitments to report accounting for contingencies. Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or un-asserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or un-asserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein.

 

If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s condensed consolidated financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed.

 

Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. Management does not believe, based upon information available at this time that these matters will have a material adverse effect on the Company’s financial position, results of operations or cash flows. However, there is no assurance that such matters will not materially and adversely affect the Company’s business, financial position, and results of operations or cash flows.

 

 
12

Table of Contents

 

FOVEA JEWELRY HOLDINGS, LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

    

·

Fair value of financial instruments

  

The Company follows paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and has adopted paragraph 820-10-35-37 of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 of the FASB Accounting Standards Codification establishes a framework for measuring fair value in generally accepted accounting principles (GAAP), and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, paragraph 820-10-35-37 of the FASB Accounting Standards Codification establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by paragraph 820-10-35-37 of the FASB Accounting Standards Codification are described below:

 

Level 1

 

Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.

 

 

 

Level 2

 

Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.

 

 

 

Level 3

 

Pricing inputs that are generally observable inputs and not corroborated by market data.

 

Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable.

 

The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument.

 

The carrying amounts of the Company’s financial assets and liabilities, such as cash and cash equivalents, approximate their fair values because of the short maturity of these instruments.

 

·

Recent accounting pronouncements

  

In January 2017, the Financial Accounting Standard Board (“FASB”) issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350) : Simplifying the Accounting for Goodwill Impairment (“ASU 2017-04”). ASU 2017-04 removes Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation. A goodwill impairment will now be the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. This standard, which will be effective for the Company beginning in the first quarter of fiscal year 2020, is required to be applied prospectively. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company is currently evaluating the impact this standard will have on its condensed consolidated financial statements.

 

In June 2018, the FASB issued ASU 2018-07, Improvements to Nonemployee Share-Based Payment Accounting (“ASU 2018-07”), which supersedes ASC 505-50 and expands the scope of ASC 718 to include all share-based payments arrangements related to the acquisition of goods and services from both employees and nonemployees. For public companies, the amendments are effective for annual reporting periods beginning after December 15, 2018, including interim periods within those annual periods. Early adoption is permitted, but no earlier than a company’s adoption date of ASC 606. The Company does not believe that the adoption of ASU 2018-07 will have a material impact on the Company’s condensed consolidated financial statements.

  

 
13

Table of Contents

  

FOVEA JEWELRY HOLDINGS, LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

    

In August 2018, the FASB issued ASU No. 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract, which amended its guidance for costs of implementing a cloud computing service arrangement to align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. This new standard also requires customers to expense the capitalized implementation costs of a hosting arrangement that is a service contract over the term of the hosting arrangement. This new standard becomes effective for the Company in the first quarter of fiscal year 2020, with early adoption permitted. This new standard can be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. The Company is evaluating the impact of adopting this amendment to its condensed consolidated financial statements.

 

The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and do not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations.

    

NOTE 3 - STOCKHOLDERS’ EQUITY

 

Authorized shares

 

As of September 30, 2020 and December 31, 2019, the Company’s authorized shares were 5,000,000 shares of preferred stock, with a par value of $0.001.

 

As of September 30, 2020 and December 31, 2019, the Company’s authorized shares were 2,000,000,000 and 499,000,000 shares of common stock, with a par value of $0.001, respectively.

 

 
14

Table of Contents

 

FOVEA JEWELRY HOLDINGS, LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

     

Issued and outstanding shares

 

As of September 30, 2020 and December 31, 2019, the Company had 1,000,000 shares of Series A preferred stock issued and outstanding.

 

On March 6, 2020, the Company approved by the state government of Wyoming and effectuated a 1 for 10,000 reverse stock split. The number of authorized shares remains unchanged. All share and per share information in this financial statements and footnotes have been retroactively adjusted for all periods presented, unless otherwise indicated, to give effect to the reverse stock split.

 

On March 20, 2020, the Company consummated the Share Exchange Transaction among Gold Shiny International Limited (“GSIL”) and its shareholders and issued 10,000,000 shares of common stock in exchange for 100% equity interest of GSIL. Upon completion of the Share Exchange Transaction, GSIL became a 100% owned subsidiary of the Company.

 

As of September 30, 2020 and December 31, 2019, the Company had 10,161,039 and 10,161,039 shares of common stock issued and outstanding, respectively.

  

NOTE 4 - INCOME TAX

 

The provision for income taxes consisted of the following:

 

 

 

Nine months ended September 30,

 

 

 

2020

 

 

2019

 

 

 

 

 

 

 

 

Current tax

 

$ 25,129

 

 

$ -

 

Deferred tax

 

 

(3,455 )

 

 

6,204

 

 

 

 

 

 

 

 

 

 

Income tax expense

 

$ 21,674

 

 

$ 6,204

 

 

The effective tax rate in the periods presented is the result of the mix of income earned in various tax jurisdictions that apply a broad range of income tax rate. The Company mainly operates in Hong Kong that is subject to taxes in the jurisdictions in which they operate, as follows:

 

United States of America

 

FJHL is registered in the State of Wyoming and is subject to the tax laws of United States of America.

 

For the nine months ended September 30, 2020 and 2019, there was no operation in the United States of America.

 

BVI

 

Under the current BVI law, the Company is not subject to tax on income.

 

Hong Kong

 

The Company’s subsidiary operating in Hong Kong is subject to the Hong Kong Profits Tax at the two-tiered profits tax rates from 8.25% to 16.5% on the estimated assessable profits arising in Hong Kong during the current year, after deducting a tax concession for the tax year. The reconciliation of income tax rate to the effective income tax rate for the nine months ended September 30, 2020 and 2019 is as follows:

 

 

 

Nine months ended September 30,

 

 

 

2020

 

 

2019

 

 

 

 

 

 

 

 

Income before income taxes

 

$ 306,179

 

 

$ 45,629

 

Statutory income tax rate

 

 

16.5 %

 

 

16.5 %

Income tax expense at statutory rate

 

 

50,519

 

 

 

7,529

 

Tax effect of non-deductible items

 

 

956

 

 

 

105

 

Tax effect of tax holiday

 

 

(26,346 )

 

 

(7,634 )

Income tax expense

 

$ 25,129

 

 

$ -

 

 

 
15

Table of Contents

 

FOVEA JEWELRY HOLDINGS, LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

    

The following table sets forth the significant components of the deferred tax liabilities of the Company as of September 30, 2020 and December 31, 2019:

 

 

 

As of

 

 

 

September 30,

 

 

December 31,

 

 

 

2020

 

 

2019

 

 

 

 

 

 

 

 

Deferred tax liabilities:

 

 

 

 

 

 

Accelerated depreciation

 

$ (3,455 )

 

$ 5,933

 

 

NOTE 5 - RELATED PARTY TRANSACTIONS

 

Apart from the transactions and balances detailed elsewhere in these accompanying condensed consolidated financial statements, the Company has no other significant or material related party transactions during the periods presented.

 

NOTE 6 - CONCENTRATIONS OF RISK

 

The Company is exposed to the following concentrations of risk:

 

(a) Major customers

 

For the three and nine months ended September 30, 2020,there was one single customer exceeding 10% of the Company’s revenue.

 

For the three and nine months ended September 30, 2019,there was no single customer exceeding 10% of the Company’s revenue.

 

All of the Company’s customers are located in Hong Kong.

 

(b) Major vendor

 

For the nine months ended September 30, 2020, two venders represented more than 10% of the Company’s operating cost. These vendors accounted for 85% and 15%, respectively, of the Company’s operating cost with no accounts payable at September 30, 2020.

 

For the three months ended September 30, 2020, there was one vender represented more than 10% of the Company’s operating cost. This vendor accounted for 100% of the Company’s operating cost with no accounts payable at September 30, 2020.

 

For the three and nine months ended September 30, 2019, there was one single vendor represented more than 10% of the Company’s operating cost.

 

The Company’s vendor is located in Hong Kong.

 

 
16

Table of Contents

 

FOVEA JEWELRY HOLDINGS, LTD

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

      

(c) Economic and political risk

 

The Company’s major operations are conducted in Hong Kong. Accordingly, the political, economic, and legal environments in Hong Kong, as well as the general state of Hong Kong’s economy may influence the Company’s business, financial condition, and results of operations.

 

(d) Exchange rate risk

 

The Company cannot guarantee that the current exchange rate will remain steady; therefore there is a possibility that the Company could post the same amount of profit for two comparable periods and because of the fluctuating exchange rate actually post higher or lower profit depending on exchange rate of HKD converted to US$ on that date. The exchange rate could fluctuate depending on changes in political and economic environments without notice.

    

NOTE 7 - COMMITMENTS AND CONTINGENCIES

 

As of September 30, 2020, the Company has no material commitments or contingencies.

  

NOTE 8 - SUBSEQUENT EVENTS

 

In accordance with ASC Topic 855, “Subsequent Events”, which establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before condensed consolidated financial statements are issued, the Company has evaluated all events or transactions that occurred after September 30, 2020, up through the date the Company issued the unaudited condensed consolidated financial statements.

 

 
17

Table of Contents

 

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

 

The following information should be read in conjunction with (i) the financial statements of Fovea Jewelry Holdings, Ltd., a Nevada corporation (the “Company”), and the notes thereto appearing elsewhere in this Form 10-Q together with (ii) the more detailed business information and the December 31, 2019 audited financial statements and related notes included in the Company’s Amendment No. 2 to Registration Statement on Form 10 (File No. 000-56156; the “Form 10”), as filed with the Securities and Exchange Commission on May 1, 2020. Statements in this section and elsewhere in this Form 10-Q that are not statements of historical or current fact constitute “forward-looking” statements.

 

OVERVIEW

 

The Company is incorporated in the State of Wyoming as a result of a domestication from the State of Nevada on March 4, 2019, and has a fiscal year end of December 31.

 

CRITICAL ACCOUNTING POLICIES

 

The discussion and analysis of our financial condition and results of operations are based on our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States (“US GAAP”). The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates based 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. Actual results may differ from these estimates under different assumptions or conditions. We have identified the policies below as critical to our business operations and to the understanding of our financial results:

 

Derivative Instruments

 

The derivative instruments are accounted for as liabilities, the derivative instrument is initially recorded at its fair market value and is then re-valued at each reporting date, with changes in fair value recognized in operations for each reporting period. The Company uses the Binomial option pricing model to value the derivative instruments.

 

Stock Based Compensation

 

Stock based compensation costs are measured at fair value on date of grant and recognition of compensation over the service period for awards expected to vest. The Company determines the fair value of awards using the Black - Scholes valuation model.

 

New Accounting Pronouncements

 

In February 2016, Financial Accounting Standard Board (“FASB”) issued ASC 842 that requires lessees to recognize lease assets and corresponding lease liabilities on the balance sheet for all leases with terms of more than 12 months. The update, which supersedes existing lease guidance, will continue to classify leases as either finance or operating, with the classification determining the pattern of expense recognition in the income statement.

 

The ASU has become effective for annual and interim periods beginning January 1, 2019, with early adoption permitted, and is applicable on a modified retrospective basis with various optional practical expedients. The Company has assessed the impact of this standard and the impact was immaterial to the financial statements.

 

 
18

Table of Contents

 

The Company reviews new accounting standards as issued. No new standards had any material effect on these financial statements. The accounting pronouncements issued subsequent to the date of these financial statements that were considered significant by management were evaluated for the potential effect on these consolidated financial statements. Management does not believe any of the subsequent pronouncements will have a material effect on these consolidated financial statements as presented and does not anticipate the need for any future restatement of these consolidated financial statements because of the retro-active application of any accounting pronouncements issued subsequent to September 30, 2020 through the date these financial statements were issued.

 

Revenue Recognition

 

Effective January 1, 2018, the Company adopted ASC 606 — Revenue from Contracts with Customers. Under ASC 606, the Company recognizes revenue from the commercial sales of products 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. For the comparative periods, revenue has not been adjusted and continues to be reported under ASC 605 — Revenue Recognition. Under ASC 605, revenue is recognized when the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) the performance of service has been rendered to a customer or delivery has occurred; (3) the amount of fee to be paid by a customer is fixed and determinable; and (4) the collectability of the fee is reasonably assured. The Company recognizes revenues and the related costs when persuasive evidence of an arrangement exists, delivery and acceptance has occurred, or service has been rendered, the price is fixed or determinable, and collection of the resulting receivable is reasonably assured. Amounts invoiced or collected in advance of product delivery or providing services are recorded as deferred revenue. The Company accrues for sales returns, bad debts, and other allowances based on its historical experience.

 

Pursuant to ASC 605: revenues were recognized when the four basic criteria for recognition were met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services have been rendered; (3) consideration is fixed or determinable; and (4) collectability is reasonably assured.

 

Use of Estimates

 

The preparation of these financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

 

Fair Value of Financial Instruments

 

The fair value of financial instruments, which include cash, accounts payable and accrued expenses and advances from related parties were estimated to approximate their carrying values due to the immediate or short-term maturity of these financial instruments. Management is of the opinion that the Company is not exposed to significant interest, currency or credit risks arising from financial instruments.

 

Fair value is defined as the price which would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A three-tier fair value hierarchy which prioritizes the inputs used in the valuation methodologies, as follows:

 

Level 1 Inputs - Unadjusted quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date.

 

Level 2 Inputs - Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These might include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (such as interest rates, volatilities, prepayment speeds, credit risks, etc.) or inputs that are derived principally from or corroborated by market data by correlation or other means.

 

Level 3 Inputs - Unobservable inputs for determining the fair values of assets or liabilities that reflect an entity’s own assumptions about the assumptions that market participants would use in pricing the assets or liabilities.

 

 
19

Table of Contents

 

At September 30, 2020, the carrying amounts of the Company’s financial instruments, including cash, accounts payable and accrued expenses, approximate their respective fair value due to the short-term nature of these instruments.

 

At September 30, 2020, the Company does not have any assets or liabilities required to be measured at fair value in accordance with FASB ASC Topic 820, Fair Value Measurement.

 

PLAN OF OPERATION

 

Our plan of operations over the next 12 month period is to continue developing our website to have a fully functioning online store and sell our diamond products.

    

Comparison of the three months ended September 30, 2020 and September 30, 2019

 

The following table sets forth certain operational data for the three months ended September 30, 2020, compared to the three months ended September 30, 2019:

 

 

 

Three months ended September 30,

 

 

 

2020

 

 

2019

 

 

 

 

 

 

 

 

Revenue

 

$ 542,900

 

 

$ 25,919

 

Cost of revenue

 

 

(271,443 )

 

 

(10,209 )

Gross profit

 

 

271,457

 

 

 

15,710

 

Operating Expenses

 

 

(8,630 )

 

 

(5,989 )

Income from operations

 

 

262,827

 

 

 

9,721

 

Income tax expense

 

 

(22,312 )

 

 

(6,204 )

NET INCOME

 

$ 240,515

 

 

$ 3,517

 

 

Revenue. We generated revenues of $542,900 and $25,919 for the three months ended September 30, 2020 and 2019, respectively. The increase in revenue is attributable to the development of new business line in healthcare supplement products to meet with the pandemic demand.

 

Cost of Revenue. Cost of revenue for the three months ended September 30, 2020, was $271,443 as compared to cost of revenue of $10,209 for the same period ended September 30, 2019. Cost of revenue increased primarily as a result of the increase in our business volume.

 

Gross Profit. We achieved a gross profit of $271,457 and $15,710 for the three months ended September 30, 2020, and 2019, respectively. The increase in gross profit is primarily attributable to the increasing market demand.

 

Operating Expenses. We incurred G&A expenses of $8,630 and $5,989 for the three months ended September 30, 2020, and 2019, respectively. The increase in G&A is primarily attributable to increase professional, administrative and other fees.

 

Income Tax Expense. Our income tax expenses for the three months ended September 30, 2020 and 2019 was $22,312 and $6,204, respectively.

 

Net Income. During the three months ended September 30, 2020, we incurred a net income of $240,515, as compared to net income of $3,517 for the same period ended September 30, 2019.

 

 
20

Table of Contents

 

Comparison of the nine months ended September 30, 2020 and September 30, 2019

 

The following table sets forth certain operational data for the nine months ended September 30, 2020, compared to the nine months ended September 30, 2019:

 

 

 

Nine months ended September 30,

 

 

 

2020

 

 

2019

 

 

 

 

 

 

 

 

Revenue

 

$ 942,965

 

 

$ 109,208

 

Cost of revenue

 

 

(604,566 )

 

 

(54,912 )

Gross profit

 

 

338,399

 

 

 

54,296

 

Operating expenses

 

 

(32,220 )

 

 

(8,667 )

Income from operation

 

 

306,179

 

 

 

45,629

 

Income tax expense

 

 

(21,674 )

 

 

(6,204 )

NET LOSS

 

$ 284,505

 

 

$ 39,425

 

 

Revenue. We generated revenues of $942,965 and $109,208 for the nine months ended September 30, 2020 and 2019, respectively. The increase in revenue is attributable to the development of new business line in healthcare supplement products to meet with the pandemic demand.

 

Cost of Revenue. Cost of revenue for the nine months ended September 30, 2020, was $604,566. Cost of revenue for the nine months ended September 30, 2019, was $54,912. The increase in our cost of revenue for the nine months ended September 30, 2020, is primarily attributable to increase in our business volume.

 

Gross Profit. We achieved a gross profit of $338,399 and $54,296 for the nine months ended September 30, 2020, and 2019, respectively. The increase in gross profit is primarily attributable to increase in our business volume.

 

Operating Expenses. We incurred operating expenses of $32,220 and $8,667 for the nine months ended September 30, 2020, and 2019, respectively. The increase in G&A is primarily attributable to increase professional, administrative and other fees.

 

Operating expenses as a percentage of net revenue was approximately 3.4% and 7.9% for the nine months ended September 30, 2020 and 2019, respectively. The increase in G&A is primarily attributable to increase professional, administrative and other fees.

 

Income Tax Expense. Our income tax expenses for the nine months ended September 30, 2020 and 2019 was $21,674 and $6,204, respectively.

 

Net Income. During the nine months ended September 30, 2020, we realized a net income of $284,505, as compared to net income of $39,425 for the same period ended September 30, 2019.

 

Liquidity and Capital Resources

 

As of September 30, 2020, we had cash and cash equivalents of $46,755 and accounts receivable of $543,639. As of December 31, 2019, we had cash and cash equivalents of $31,380 and accounts receivable of $0.

 

 

 

Nine Months Ended September 30,

 

 

 

2020

 

 

2019

 

Net cash provided by operating activities

 

$ 29,501

 

 

$ 46,266

 

Net cash used in investing activities

 

$ -

 

 

$ (38,220 )

Net cash provided by financing activities

 

$ 2,062

 

 

$ -

 

 

 
21

Table of Contents

 

Net Cash Provided By Operating Activities.

 

For the nine months ended September 30, 2020, net cash provided by operating activities was $29,501 which consisted primarily of a net income of $284,505, an increase in accounts payables of $271,812, a decrease in accrued liabilities and other payables of $10,708, an increase in tax payable of $25,164 and depreciation of property, plant and equipment of $5,798 offset by an increase in accounts receivables of $543,639 and a decrease in deferred tax liabilities of $3,431.

 

For the nine months ended September 30, 2019, net cash provided by operating activities was $46,266, which consisted primarily of a net income of $39,425, an increase in deferred tax liabilities of $6,204, and depreciation of property, plant and equipment of $637.

 

Net Cash Used In Investing Activities.

 

For the nine months ended September 30, 2020, net cash used in investing activities was $0.

 

For the nine months ended September 30, 2019, net cash used in investing activities was $38,220, consisting of property, plant and equipment purchases relating to discontinued operations.

    

Net Cash Provided By Financing Activities.

 

For the nine months ended September 30, 2020, net cash provided by financing activities was $2,062 consisting primarily of advances from our former Chief Executive Officer.

 

For the nine months ended September 30, 2019, net cash provided by financing activities was $0.

 

Off-Balance Sheet Arrangements

 

The Company has no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to stockholders

 

Subsequent Events

 

None through the date of this filing.

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

 

As a smaller reporting company (as defined in Rule 12b-2 of the Exchange Act), we are not required to provide the information called for by this Item 3.

 

ITEM 4. CONTROLS AND PROCEDURES.

 

DISCLOSURE CONTROLS AND PROCEDURES

 

Under the supervision and with the participation of our management, our principal executive officer and our principal financial officer are responsible for conducting an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as of the end of the fiscal year covered by this report. Disclosure controls and procedures means that the material information required to be included in our Securities and Exchange Commission reports is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms relating to our company, including any consolidating subsidiaries, and was made known to us by others within those entities, particularly during the period when this report was being prepared. Based on this evaluation, our principal executive officer and principal financial officer concluded as of the evaluation date that our disclosure controls and procedures were not effective as of September 30, 2020.

 

There were no changes in the Company’s internal controls over financial reporting during the most recently completed fiscal quarter that have materially affected or are reasonably likely to materially affect the Company’s internal control over financial reporting.

 

 
22

Table of Contents

 

PART II. OTHER INFORMATION

 

ITEM 1. LEGAL PROCEEDINGS.

 

The Company is not currently subject to any legal proceedings. From time to time, the Company may become subject to litigation or proceedings in connection with its business, as either a plaintiff or defendant. There are no such pending legal proceedings to which the Company is a party that, in the opinion of management, is likely to have a material adverse effect on the Company’s business, financial condition or results of operations.

 

ITEM 1A. RISK FACTORS

 

As a smaller reporting company (as defined in Rule 12b-2 of the Exchange Act), we are not required to provide the information called for by this Item 1A.

 

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

 

None.

 

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

 

None.

 

ITEM 4. MINE SAFETY DISCLOSURES.

 

None.

 

ITEM 5. OTHER INFORMATION.

 

None.

 

 
23

Table of Contents

 

ITEM 6. EXHIBITS.

 

(a) Exhibits required by Item 601 of Regulation SK.:

 

Number

 

Description

 

 

 

2.1

 

Share Exchange Agreement (1)

3.1.1

 

Articles of Domestication (1)

3.1.2

 

Articles of Amendment (1)

3.1.3

 

Articles of Amendment to Articles of Domestication (2)

3.1.4

 

Articles of Amendment to Articles of Domestication (1)

3.2

 

Bylaws (1)

31.1

 

Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2

 

Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1

 

Certification of Principal Executive Officer and Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS *

 

XBRL Instance Document

101.SCH *

 

XBRL Taxonomy Extension Schema Document

101.CAL *

 

XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF *

 

XBRL Taxonomy Extension Definition Linkbase Document

101.LAB *

 

XBRL Taxonomy Extension Label Linkbase Document

101.PRE *

 

XBRL Taxonomy Extension Presentation Linkbase Document

_____________

* Filed herewith

(1) Incorporated by reference to Registration Statement on Form 10 (File No. 000-56156), filed with the Securities and Exchange Commission on March 23, 2020.

(2) Incorporated by reference to Amendment No. 1 to Registration Statement on Form 10 (File No. 00056156), filed with the Securities and Exchange Commission on April 23, 2020.

 

 
24

Table of Contents

 

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.

  

 

FOVEA JEWELRY HOLDINGS, LTD.

 

 

Date: November 12, 2020

By:

/s/ Thomson Lee

 

 

 

Name: Thomson Lee

 

 

Title: Chief Executive Officer

(principal executive officer, principal accounting officer and principal financial officer)

 

 
25

 

EX-31.1 2 fjhl_ex311.htm CERTIFICATION fjhl_ex311.htm

EXHIBIT 31.1

 

SECTION 302 CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER OF FOVEA JEWELRY HOLDINGS, LTD.

 

I, Thomson Lee, certify that:

 

1.

I have reviewed this quarterly report on Form 10-Q of Fovea Jewelry Holdings, Ltd.;

 

 

2.

Based on my knowledge, this quarterly 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 quarterly report;

 

 

3.

Based on my knowledge, the financial statements, and other financial information included in this quarterly 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 quarterly 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: November 12, 2020

By:

/s/ Thomson Lee

 

 

 

Thomson Lee

 

 

 

Chief Executive Officer

(principal executive officer, principal accounting

officer and principal financial officer)

 

EX-31.2 3 fjhl_ex312.htm CERTIFICATION fjhl_ex312.htm

EXHIBIT 31.2

 

SECTION 302 CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER OF FOVEA JEWELRY HOLDINGS, LTD.

 

I, Thomson Lee, certify that:

 

1.

I have reviewed this quarterly report on Form 10-Q of Fovea Jewelry Holdings, Ltd.;

 

 

2.

Based on my knowledge, this quarterly 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 quarterly report;

 

 

3.

Based on my knowledge, the financial statements, and other financial information included in this quarterly 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 quarterly 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: November 12, 2020

By:

/s/ Thomson Lee

 

 

 

Thomson Lee

 

 

 

Chief Executive Officer

(principal executive officer, principal accounting

officer and principal financial officer)

 

 

EX-32.1 4 fjhl_ex321.htm CERTIFICATION fjhl_ex321.htm

EXHIBIT 32.1

 

SECTION 906 CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER AND PRINCIPAL FINANCIAL OFFICER OF FOVEA JEWELRY HOLDINGS, LTD.

 

In connection with the accompanying Quarterly Report on Form 10-Q of Fovea Jewelry Holdings, Ltd. for the quarter ended September 30, 2020, the undersigned, Thomson Lee, Chief Executive Officer of Fovea Jewelry Holdings, Ltd., does hereby certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

 

(1)

such Quarterly Report on Form 10-Q for the quarter ended September 30, 2020 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

 

 

(2)

the information contained in such Quarterly Report on Form 10-Q for the quarter ended September 30, 2020 fairly presents, in all material respects, the financial condition and results of operations of Fovea Jewelry Holdings, Ltd.

 

Date: November 12, 2020

By:

/s/ Thomson Lee

 

 

 

Chief Executive Officer

 

 

 

(principal executive officer, principal accounting

officer and principal financial officer)

 

 

 

 

 

 

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0 <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">Fovea Jewelry Holdings, Ltd (the &#8220;Company&#8221; or &#8220;FJHL&#8221;) was originally founded on February 1, 2006 as Dycam, Inc. In March 2006, the Company changed its name to Mekju Processing, Inc. In November 2006, the Company changed its name to Auxium Technologies, Inc. In November 2014, the Company changed its name to Pure Hospitality Solutions, Inc. On November 2, 2015, the Company changed its name to Wincash Resources, Inc. In early 2018, the Board of Directors of the Company deemed it in the best interests of the Company and its shareholders to switch directions and become involved in the business of the collection and ultimately the sale of diamond jewelry. </p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">Effective September 26, 2018, the Company changed its name from Wincash Resources, Inc. to Fovea Jewelry Holdings, Ltd. The Financial Industry Regulatory Authority and the OTC Markets Group, Inc. recognized the name change on February 3, 2018. Further, in connection with changing its name, the Company changed its trading symbol to FJHL.</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">As a result of the change in business, the Company redomiciled from Nevada to Wyoming on March 4, 2019.</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">Currently, the Company through its subsidiaries, mainly commenced to operate an online store to sell the quality jewelry at affordable prices on www.fovea-jewellery.com. The goal is to &#8220;Deliver A Better Living&#8221;. All products selling on the online store are with great quality, natural, socially responsible and niche. This business was commenced its operation in Hong Kong from January 1, 2019.</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">On March 6, 2020, the Company approved by the state government of Wyoming and effectuated a 1 for 10,000 reverse stock split. The number of authorized shares remains unchanged. All share and per share information in this financial statements and footnotes have been retroactively adjusted for all periods presented, unless otherwise indicated, to give effect to the reverse stock split.</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">On March 20, 2020, the Company consummated the Share Exchange Transaction among Gold Shiny International Limited (&#8220;GSIL&#8221;) and its shareholders. The Company acquired all of the issued and outstanding shares of GSIL from GSIL&#8217;s shareholders, in exchange for 10,000,000 shares of the issued and outstanding common stock. Upon completion of the Share Exchange Transaction, GSIL became a 100% owed subsidiary of the Company.</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">Prior to the acquisition, the Company was considered as a shell company due to its nominal assets and limited operation. Upon the acquisition, GSIL will comprise the ongoing operations of the combined entity, GSIL is deemed to be the accounting acquirer for accounting purposes. The transaction will be treated as a recapitalization of the Company. Accordingly, the consolidated assets, liabilities and results of operations of the Company will become the historical financial statements of GSIL, and the Company&#8217;s assets, liabilities and results of operations will be consolidated with GSIL beginning on the acquisition date. GSIL was the legal acquiree but deemed to be the accounting acquirer. The Company was the legal acquirer but deemed to be the accounting acquiree in the reverse merger. The historical financial statements prior to the acquisition are those of the accounting acquirer (GSIL). Historical stockholders&#8217; equity of the accounting acquirer prior to the merger are retroactively restated (a recapitalization) for the equivalent number of shares received in the merger. Operations prior to the merger are those of the acquirer. After completion of the share exchange transaction, the Company&#8217;s consolidated financial statements include the assets and liabilities, the operations and cash flow of the accounting acquirer.</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;"><u>Description of subsidiar</u><u>ies</u></p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td style="BORDER-BOTTOM: 1px solid;width:15%;vertical-align:bottom;"> <p style="margin:0px">Name</p></td> <td style="width:2%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:15%;vertical-align:bottom;"> <p style="margin:0px">Place of incorporation</p> <p style="margin:0px">and kind of </p> <p style="margin:0px">legal entity</p></td> <td style="width:2%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:15%;vertical-align:bottom;"> <p style="margin:0px">Principal activities</p> <p style="margin:0px">and place of operation</p></td> <td style="width:2%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:15%;vertical-align:bottom;"> <p style="margin:0px">Particulars of registered/ paid up share</p> <p style="margin:0px">capital</p></td> <td style="width:2%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:15%;vertical-align:bottom;"> <p style="margin:0px">Effective interest</p> <p style="margin:0px">held</p></td></tr> <tr style="height:15px"> <td> <p style="MARGIN: 0px; text-align:justify;">&nbsp;</p></td> <td> <p style="MARGIN: 0px; text-align:justify;">&nbsp;</p></td> <td> <p style="MARGIN: 0px; text-align:justify;">&nbsp;</p></td> <td> <p style="MARGIN: 0px; text-align:justify;">&nbsp;</p></td> <td> <p style="MARGIN: 0px; text-align:justify;">&nbsp;</p></td> <td> <p style="MARGIN: 0px; text-align:justify;">&nbsp;</p></td> <td> <p style="MARGIN: 0px; text-align:justify;">&nbsp;</p></td> <td> <p style="MARGIN: 0px; text-align:justify;">&nbsp;</p></td> <td> <p style="MARGIN: 0px; text-align:justify;">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#cceeff"> <td style="vertical-align:top;"> <p style="margin:0px">Fovea International Holdings Limited</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">British Virgin Islands</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">Investment holding</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">100 ordinary shares at par value of US$1</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">100%</p></td></tr> <tr style="height:15px;background-color:#ffffff"> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#cceeff"> <td style="vertical-align:top;"> <p style="margin:0px">Fovea Jewellery Holdings Limited</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">Hong Kong</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">Sales and marketing in Hong Kong</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">1 ordinary share for HK$1</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">100%</p></td></tr> <tr style="height:15px;background-color:#ffffff"> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#cceeff"> <td style="vertical-align:top;"> <p style="margin:0px">Gold Shiny International Limited</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">British Virgin Islands</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">Investment holding</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">115 ordinary shares at par value of US$1</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">100%</p></td></tr> <tr style="height:15px;background-color:#ffffff"> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#cceeff"> <td style="vertical-align:top;"> <p style="margin:0px">Gold Shiny (Asia) Limited</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">Hong Kong</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">Sales and marketing in Hong Kong</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">1 ordinary share for HK$1</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">100%</p></td></tr></table> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp; </p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">The Company and its subsidiaries are hereinafter referred to as (the &#8220;Company&#8221;).</p></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><p style="font-size:10pt;font-family:times new roman;margin:0px">The accompanying condensed consolidated financial statements reflect the application of certain significant accounting policies as described in this note and elsewhere in the accompanying condensed consolidated financial statements and notes.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td style="width:4%;vertical-align:top;"> <p style="margin:0px"><font style="font-family:Symbol">&#183;</font></p></td> <td style="vertical-align:top;"> <p style="margin:0px 0px 0px 0cm">Basis of presentation</p></td></tr></table> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">These accompanying condensed consolidated financial statements have been prepared in U.S. Dollars in conformity with generally accepted accounting principles in the United States of America (&#8220;U.S. GAAP&#8221;) for interim financial information pursuant to the rules and regulations of the Securities and Exchange Commission (the &#8220;SEC&#8221;). Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary to make the financial statements not misleading have been included. Operating results for the interim period ended September 30, 2020 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2020. The information included in this Form 10-Q should be read in conjunction with Management&#8217;s Discussion and Analysis, and the financial statements and notes thereto included in the Company&#8217;s Form 10/A for the fiscal year ended December 31, 2019, filed with the SEC on May 1, 2020.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td style="width:4%;vertical-align:top;"> <p style="margin:0px"><font style="font-family:Symbol">&#183;</font></p></td> <td style="vertical-align:top;"> <p style="margin:0px 0px 0px 0cm">Use of estimates and assumptions</p></td></tr></table> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">In preparing these condensed consolidated financial statements, management makes estimates and assumptions that affect the reported amounts of assets and liabilities in the balance sheet and revenues and expenses during the periods reported. Actual results may differ from these estimates.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td style="width:4%;vertical-align:top;"> <p style="margin:0px"><font style="font-family:Symbol">&#183;</font></p></td> <td style="vertical-align:top;"> <p style="margin:0px 0px 0px 0cm">Basis of consolidation</p></td></tr></table> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">The condensed consolidated financial statements include the accounts of FJHL and its subsidiaries. All significant inter-company balances and transactions within the Company have been eliminated upon consolidation.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td style="width:4%;vertical-align:top;"> <p style="margin:0px"><font style="font-family:Symbol">&#183;</font></p></td> <td style="vertical-align:top;"> <p style="margin:0px 0px 0px 0cm">Cash and cash equivalents</p></td></tr></table> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">Cash and cash equivalents are carried at cost and represent cash on hand, demand deposits placed with banks or other financial institutions and all highly liquid investments with an original maturity of three months or less as of the purchase date of such investments. </p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td style="width:4%;vertical-align:top;"> <p style="margin:0px"><font style="font-family:Symbol">&#183;</font></p></td> <td style="vertical-align:top;"> <p style="margin:0px 0px 0px 0cm">Accounts receivable</p></td></tr></table> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">Accounts receivable are recorded at the invoiced amount and do not bear interest, which are due within contractual payment terms, generally 30 to 90 days from completion of service. Credit is extended based on evaluation of a customer&#8217;s financial condition, the customer credit-worthiness and their payment history. Accounts receivable outstanding longer than the contractual payment terms are considered past due. Past due balances over 90 days and over a specified amount are reviewed individually for collectibility. At the end of fiscal year, the Company specifically evaluates individual customer&#8217;s financial condition, credit history, and the current economic conditions to monitor the progress of the collection of accounts receivables. The Company will consider the allowance for doubtful accounts for any estimated losses resulting from the inability of its customers to make required payments. For the receivables that are past due or not being paid according to payment terms, the appropriate actions are taken to exhaust all means of collection, including seeking legal resolution in a court of law. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company does not have any off-balance-sheet credit exposure related to its customers. As of September 30, 2020, there was no allowance for doubtful accounts.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td style="width:4%;vertical-align:top;"> <p style="margin:0px"><font style="font-family:Symbol">&#183;</font></p></td> <td style="vertical-align:top;"> <p style="margin:0px 0px 0px 0cm">Plant and equipment</p></td></tr></table> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">Plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses, if any. Depreciation is calculated on the straight-line basis over the following expected useful lives from the date on which they become fully operational and after taking into account their estimated residual values:</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:15%;vertical-align:top;"> <p style="MARGIN: 0px; text-align:center;">Expected useful lives</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#cceeff"> <td style="vertical-align:top;"> <p style="margin:0px">Computer equipment</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="MARGIN: 0px; text-align:center;">5 years</p></td> <td> <p style="margin:0px">&nbsp;</p></td></tr></table> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">Expenditures for repairs and maintenance are expensed as incurred. When assets have been retired or sold, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in the results of operations.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">Depreciation expense for the three months ended September 30, 2020 and 2019 were $1,932 and $637, respectively.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">Depreciation expense for the nine months ended September 30, 2020 and 2019 were $5,798 and $637, respectively.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td style="width:4%;vertical-align:top;"> <p style="margin:0px"><font style="font-family:Symbol">&#183;</font></p></td> <td style="vertical-align:top;"> <p style="margin:0px 0px 0px 0cm">Revenue recognition</p></td></tr></table> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">The Company adopted Accounting Standards Update (&#8220;ASU&#8221;) No. 2014-09, Revenue from Contracts with Customers (Topic 606) (&#8220;ASU 2014-09&#8221;) using the full retrospective transition method. The Company&#8217;s adoption of ASU 2014-09 did not have a material impact on the amount and timing of revenue recognized in its condensed consolidated financial statements.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">Under ASU 2014-09, the Company recognizes revenue when control of the promised goods or services is transferred to customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">The Company applies the following five steps in order to determine the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its agreements:</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td style="width:4%;vertical-align:top;"> <p style="margin:0px"><font style="font-size:14pt">&#8226;</font></p></td> <td style="vertical-align:top;"> <p style="margin:0px">identify the contract with a customer;</p></td></tr> <tr style="height:15px"> <td style="vertical-align:top;"> <p style="margin:0px"><font style="font-size:14pt">&#8226;</font></p></td> <td style="vertical-align:top;"> <p style="margin:0px">identify the performance obligations in the contract;</p></td></tr> <tr style="height:15px"> <td style="vertical-align:top;"> <p style="margin:0px"><font style="font-size:14pt">&#8226;</font></p></td> <td style="vertical-align:top;"> <p style="margin:0px">determine the transaction price;</p></td></tr> <tr style="height:15px"> <td style="vertical-align:top;"> <p style="margin:0px"><font style="font-size:14pt">&#8226;</font></p></td> <td style="vertical-align:top;"> <p style="margin:0px">allocate the transaction price to performance obligations in the contract; and</p></td></tr> <tr style="height:15px"> <td style="vertical-align:top;"> <p style="margin:0px"><font style="font-size:14pt">&#8226;</font></p></td> <td style="vertical-align:top;"> <p style="margin:0px">recognize revenue as the performance obligation is satisfied.</p></td></tr></table> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">The Company records the revenue from the sale of jewelry and healthcare supplement products during the period.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td style="width:4%;vertical-align:top;"> <p style="margin:0px"><font style="font-family:Symbol">&#183;</font></p></td> <td style="vertical-align:top;"> <p style="margin:0px 0px 0px 0cm">Cost of revenue</p></td></tr></table> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">Cost of revenue consists primarily of the cost of goods sold, which are directly attributable to the sales of products. </p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td style="width:4%;vertical-align:top;"> <p style="margin:0px"><font style="font-family:Symbol">&#183;</font></p></td> <td style="vertical-align:top;"> <p style="margin:0px 0px 0px 0cm">Income taxes</p></td></tr></table> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">The Company adopted the ASC 740 <em>Income tax</em> provisions of paragraph 740-10-25-13, which addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the condensed consolidated financial statements. Under paragraph 740-10-25-13, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the condensed consolidated financial statements from such a position should be measured based on the largest benefit that has a greater than fifty percent (50%) likelihood of being realized upon ultimate settlement. Paragraph 740-10-25-13 also provides guidance on de-recognition, classification, interest and penalties on income taxes, accounting in interim periods and requires increased disclosures. The Company had no material adjustments to its liabilities for unrecognized income tax benefits according to the provisions of paragraph 740-10-25-13.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">The estimated future tax effects of temporary differences between the tax basis of assets and liabilities are reported in the accompanying balance sheets, as well as tax credit carry-backs and carry-forwards. The Company periodically reviews the recoverability of deferred tax assets recorded on its balance sheets and provides valuation allowances as management deems necessary.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td style="width:4%;vertical-align:top;"> <p style="margin:0px"><font style="font-family:Symbol">&#183;</font></p></td> <td style="vertical-align:top;"> <p style="margin:0px 0px 0px 0cm">Uncertain tax positions</p></td></tr></table> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">The Company did not take any uncertain tax positions and had no adjustments to its income tax liabilities or benefits pursuant to the ASC 740 provisions of Section 740-10-25 for the three and nine months ended September 30, 2020 and 2019.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td style="width:4%;vertical-align:top;"> <p style="margin:0px"><font style="font-family:Symbol">&#183;</font></p></td> <td style="vertical-align:top;"> <p style="margin:0px 0px 0px 0cm">Foreign currencies translation</p></td></tr></table> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">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 transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the condensed consolidated statement of operations.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">The reporting currency of the Company is United States Dollar (&#8220;US$&#8221;) and the accompanying condensed consolidated financial statements have been expressed in US$. In addition, the Company is operating in Hong Kong and maintain its books and record in its local currency, Hong Kong Dollars (&#8220;HKD&#8221;), which is a functional currency as being the primary currency of the economic environment in which their operations are conducted. In general, for consolidation purposes, assets and liabilities of its subsidiary whose functional currency is not US$ are translated into US$, in accordance with ASC Topic 830-30, &#8220; <em>Translation of Financial Statement</em>&#8221;, using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements of foreign subsidiary are recorded as a separate component of accumulated other comprehensive income within the statements of changes in stockholder&#8217;s equity.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">Translation of amounts from HKD into US$ has been made at the following exchange rates for the period ended September 30, 2020 and 2019:</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;" colspan="2"> <p style="MARGIN: 0px; text-align:center;"><strong>September</strong></p> <p style="MARGIN: 0px; text-align:center;"><strong>30, 2020</strong></p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;" colspan="2"> <p style="MARGIN: 0px; text-align:center;"><strong>September</strong></p> <p style="MARGIN: 0px; text-align:center;"><strong>30, 2019</strong></p></td> <td> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#cceeff"> <td style="vertical-align:top;"> <p style="margin:0px">Period-end HKD:US$ exchange rate</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:9%;vertical-align:bottom;"> <p style="MARGIN: 0px 0px 0px 0cm; text-align:right;">0.12903</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:9%;vertical-align:bottom;"> <p style="MARGIN: 0px 0px 0px 0cm; text-align:right;">0.12740</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#ffffff"> <td style="vertical-align:top;"> <p style="margin:0px">Period average HKD:US$ exchange rate</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 3px double;width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;"> <p style="MARGIN: 0px 0px 0px 0cm; text-align:right;">0.12885</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 3px double;width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;"> <p style="MARGIN: 0px 0px 0px 0cm; text-align:right;">0.12746</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td></tr></table> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td style="width:4%;vertical-align:top;"> <p style="margin:0px"><font style="font-family:Symbol">&#183;</font></p></td> <td style="vertical-align:top;"> <p style="margin:0px 0px 0px 0cm">Comprehensive income</p></td></tr></table> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">ASC Topic 220, &#8220;<em>Comprehensive Income</em>&#8221;, establishes standards for reporting and display of comprehensive income, its components and accumulated balances. Comprehensive income as defined includes all changes in equity during a period from non-owner sources. Accumulated other comprehensive income, as presented in the accompanying condensed consolidated statements of changes in stockholders&#8217; equity, consists of changes in unrealized gains and losses on foreign currency translation. This comprehensive income is not included in the computation of income tax expense or benefit.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td style="width:4%;vertical-align:top;"> <p style="margin:0px"><font style="font-family:Symbol">&#183;</font></p></td> <td style="vertical-align:top;"> <p style="margin:0px 0px 0px 0cm">Segment reporting</p></td></tr></table> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <p style="font-size:10pt;font-family:times new roman;margin:0px">ASC Topic 280, &#8220;<em>Segment Reporting</em>&#8221; establishes standards for reporting information about operating segments on a basis consistent with the Company&#8217;s internal organization structure as well as information about geographical areas, business segments and major customers in condensed consolidated financial statements. For the period ended September 30, 2020 and 2019, the Company operates in one reportable operating segment in Hong Kong.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td style="width:4%;vertical-align:top;"> <p style="margin:0px"><font style="font-family:Symbol">&#183;</font></p></td> <td style="vertical-align:top;"> <p style="margin:0px 0px 0px 0cm">Related parties</p></td></tr></table> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <p style="font-size:10pt;font-family:times new roman;margin:0px">The Company follows the ASC 850-10, <em>Related Party</em> for the identification of related parties and disclosure of related party transactions.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">Pursuant to section 850-10-20 the related parties include a)&nbsp;affiliates of the Company; b) entities for which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of section 825&#8211;10&#8211;15, to be accounted for by the equity method by the investing entity; c) trusts for the benefit of employees, such as pension and Income-sharing trusts that are managed by or under the trusteeship of management; d) principal owners of the Company; e) management of the Company; f) other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests; and g)&nbsp;other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">The condensed consolidated financial statements shall include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business. However, disclosure of transactions that are eliminated in the preparation of consolidated or combined financial statements is not required in those statements. The disclosures shall include: a)&nbsp;the nature of the relationship(s) involved; b) a description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which income statements are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the financial statements; c)&nbsp;the dollar amounts of transactions for each of the periods for which income statements are presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and d)&nbsp;amount due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td style="width:4%;vertical-align:top;"> <p style="margin:0px"><font style="font-family:Symbol">&#183;</font></p></td> <td style="vertical-align:top;"> <p style="margin:0px 0px 0px 0cm">Commitments and contingencies</p></td></tr></table> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">The Company follows the ASC 450-20, <em>Commitments</em> to report accounting for contingencies. Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or un-asserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or un-asserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company&#8217;s condensed consolidated financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. Management does not believe, based upon information available at this time that these matters will have a material adverse effect on the Company&#8217;s financial position, results of operations or cash flows. However, there is no assurance that such matters will not materially and adversely affect the Company&#8217;s business, financial position, and results of operations or cash flows.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td style="width:4%;vertical-align:top;"> <p style="margin:0px"><font style="font-family:Symbol">&#183;</font></p></td> <td style="vertical-align:top;"> <p style="margin:0px 0px 0px 0cm">Fair value of financial instruments</p></td></tr></table> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">The Company follows paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and has adopted paragraph 820-10-35-37 of the FASB Accounting Standards Codification (&#8220;Paragraph 820-10-35-37&#8221;) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 of the FASB Accounting Standards Codification establishes a framework for measuring fair value in generally accepted accounting principles (GAAP), and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, paragraph 820-10-35-37 of the FASB Accounting Standards Codification establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by paragraph 820-10-35-37 of the FASB Accounting Standards Codification are described below:</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td style="width:10%;vertical-align:top;"> <p style="margin:0px">Level 1</p></td> <td style="width:2%;"> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.</p></td></tr> <tr style="height:15px"> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px"> <td style="vertical-align:top;"> <p style="margin:0px">Level 2</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.</p></td></tr> <tr style="height:15px"> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px"> <td style="vertical-align:top;"> <p style="margin:0px">Level 3</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">Pricing inputs that are generally observable inputs and not corroborated by market data.</p></td></tr></table> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">The carrying amounts of the Company&#8217;s financial assets and liabilities, such as cash and cash equivalents, approximate their fair values because of the short maturity of these instruments.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td style="width:4%;vertical-align:top;"> <p style="margin:0px"><font style="font-family:Symbol">&#183;</font></p></td> <td style="vertical-align:top;"> <p style="margin:0px 0px 0px 0cm">Recent accounting pronouncements</p></td></tr></table> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">In January 2017, the Financial Accounting Standard Board (&#8220;FASB&#8221;) issued ASU 2017-04, <em>Intangibles - Goodwill and Other (Topic 350)</em>&nbsp;: Simplifying the Accounting for Goodwill Impairment (&#8220;ASU 2017-04&#8221;). ASU 2017-04 removes Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation. A goodwill impairment will now be the amount by which a reporting unit&#8217;s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. This standard, which will be effective for the Company beginning in the first quarter of fiscal year 2020, is required to be applied prospectively. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company is currently evaluating the impact this standard will have on its condensed consolidated financial statements.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">In June 2018, the FASB issued ASU 2018-07, <em>Improvements to Nonemployee Share-Based Payment Accounting</em>&nbsp;(&#8220;ASU 2018-07&#8221;),&nbsp;which supersedes ASC 505-50 and expands the scope of ASC 718 to include all share-based payments arrangements related to the acquisition of goods and services from both employees and nonemployees. For public companies, the amendments are effective for annual reporting periods beginning after December 15, 2018, including interim periods within those annual periods. Early adoption is permitted, but no earlier than a company&#8217;s adoption date of ASC 606. The Company does not believe that the adoption of ASU 2018-07 will have a material impact on the Company&#8217;s condensed consolidated financial statements.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">In August 2018, the FASB issued ASU No. 2018-15, <em>Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer&#8217;s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract</em>, which amended its guidance for costs of implementing a cloud computing service arrangement to align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. This new standard also requires customers to expense the capitalized implementation costs of a hosting arrangement that is a service contract over the term of the hosting arrangement. This new standard becomes effective for the Company in the first quarter of fiscal year 2020, with early adoption permitted. This new standard can be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. The Company is evaluating the impact of adopting this amendment to its condensed consolidated financial statements.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and do not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><p style="font-size:10pt;font-family:times new roman;margin:0px"><em>Authorized shares</em></p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <p style="font-size:10pt;font-family:times new roman;margin:0px">As of September 30, 2020 and December 31, 2019, the Company&#8217;s authorized shares were 5,000,000 shares of preferred stock, with a par value of $0.001.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <p style="font-size:10pt;font-family:times new roman;margin:0px">As of September 30, 2020 and December 31, 2019, the Company&#8217;s authorized shares were 2,000,000,000 and 499,000,000 shares of common stock, with a par value of $0.001, respectively.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp; <em>Issued and outstanding shares</em></p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <p style="font-size:10pt;font-family:times new roman;margin:0px">As of September 30, 2020 and December 31, 2019, the Company had 1,000,000 shares of Series A preferred stock issued and outstanding.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp;&nbsp;&nbsp; </p> <p style="font-size:10pt;font-family:times new roman;margin:0px">On March 6, 2020, the Company approved by the state government of Wyoming and effectuated a 1 for 10,000 reverse stock split. The number of authorized shares remains unchanged. All share and per share information in this financial statements and footnotes have been retroactively adjusted for all periods presented, unless otherwise indicated, to give effect to the reverse stock split. </p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">On March 20, 2020, the Company consummated the Share Exchange Transaction among Gold Shiny International Limited (&#8220;GSIL&#8221;) and its shareholders and issued 10,000,000 shares of common stock in exchange for 100% equity interest of GSIL. Upon completion of the Share Exchange Transaction, GSIL became a 100% owned subsidiary of the Company.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <p style="font-size:10pt;font-family:times new roman;margin:0px">As of September 30, 2020 and December 31, 2019, the Company had 10,161,039 and 10,161,039 shares of common stock issued and outstanding, respectively.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><p style="font-size:10pt;font-family:times new roman;margin:0px">The provision for income taxes consisted of the following:</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;" colspan="6"> <p style="MARGIN: 0px; text-align:center;"><strong>Nine months ended September 30,</strong></p></td> <td> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px"> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;" colspan="2"> <p style="MARGIN: 0px; text-align:center;"><strong>2020</strong></p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;" colspan="2"> <p style="MARGIN: 0px; text-align:center;"><strong>2019</strong></p></td> <td> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px"> <td> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td colspan="2" style="width:9%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td colspan="2" style="width:9%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#cceeff"> <td style="vertical-align:top;"> <p style="margin:0px">Current tax</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;vertical-align:bottom;"> <p style="margin:0px 0px 0px 0cm">$</p></td> <td style="width:9%;vertical-align:bottom;"> <p style="MARGIN: 0px 0px 0px 0cm; text-align:right;">25,129</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;vertical-align:bottom;"> <p style="margin:0px 0px 0px 0cm">$</p></td> <td style="width:9%;vertical-align:bottom;"> <p style="MARGIN: 0px 0px 0px 0cm; text-align:right;">-</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#ffffff"> <td style="vertical-align:top;"> <p style="margin:0px">Deferred tax</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;"> <p style="MARGIN: 0px 0px 0px 0cm; text-align:right;">(3,455</p></td> <td style="width:1%;vertical-align:bottom;"> <p style="margin:0px 0px 0px 0cm">)</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;"> <p style="MARGIN: 0px 0px 0px 0cm; text-align:right;">6,204</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#cceeff"> <td> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:9%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:9%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#ffffff"> <td style="vertical-align:top;"> <p style="margin:0px">Income tax expense</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;"> <p style="margin:0px 0px 0px 0cm">$</p></td> <td style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;"> <p style="MARGIN: 0px 0px 0px 0cm; text-align:right;">21,674</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;"> <p style="margin:0px 0px 0px 0cm">$</p></td> <td style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;"> <p style="MARGIN: 0px 0px 0px 0cm; text-align:right;">6,204</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td></tr></table> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <p style="font-size:10pt;font-family:times new roman;margin:0px">The effective tax rate in the periods presented is the result of the mix of income earned in various tax jurisdictions that apply a broad range of income tax rate. The Company mainly operates in Hong Kong that is subject to taxes in the jurisdictions in which they operate, as follows:</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp;&nbsp;&nbsp; </p> <p style="font-size:10pt;font-family:times new roman;margin:0px"><em>United States of America</em></p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <p style="font-size:10pt;font-family:times new roman;margin:0px">FJHL is registered in the State of Wyoming and is subject to the tax laws of United States of America.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp;&nbsp;&nbsp; </p> <p style="font-size:10pt;font-family:times new roman;margin:0px">For&nbsp;the nine months ended September 30, 2020 and 2019, there was no operation in the United States of America. </p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <p style="font-size:10pt;font-family:times new roman;margin:0px"><em>BVI</em></p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <p style="font-size:10pt;font-family:times new roman;margin:0px">Under the current BVI law, the Company is not subject to tax on income.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <p style="font-size:10pt;font-family:times new roman;margin:0px"><em>Hong Kong</em></p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <p style="font-size:10pt;font-family:times new roman;margin:0px">The Company&#8217;s subsidiary operating in Hong Kong is subject to the Hong Kong Profits Tax at the two-tiered profits tax rates from 8.25% to 16.5% on the estimated assessable profits arising in Hong Kong during the current year, after deducting a tax concession for the tax year. The reconciliation of income tax rate to the effective income tax rate for the nine months ended September 30, 2020 and 2019 is as follows:</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;" colspan="6"> <p style="MARGIN: 0px; text-align:center;"><strong>Nine months ended September 30,</strong></p></td> <td> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px"> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;" colspan="2"> <p style="MARGIN: 0px; text-align:center;"><strong>2020</strong></p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;" colspan="2"> <p style="MARGIN: 0px; text-align:center;"><strong>2019</strong></p></td> <td> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px"> <td> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td colspan="2" style="width:9%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td colspan="2" style="width:9%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#cceeff"> <td style="vertical-align:top;"> <p style="margin:0px">Income before income taxes </p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;vertical-align:bottom;"> <p style="margin:0px 0px 0px 0cm">$</p></td> <td style="width:9%;vertical-align:bottom;"> <p style="MARGIN: 0px 0px 0px 0cm; text-align:right;">306,179</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;vertical-align:bottom;"> <p style="margin:0px 0px 0px 0cm">$</p></td> <td style="width:9%;vertical-align:bottom;"> <p style="MARGIN: 0px 0px 0px 0cm; text-align:right;">45,629</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#ffffff"> <td style="vertical-align:top;"> <p style="margin:0px">Statutory income tax rate</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;"> <p style="MARGIN: 0px 0px 0px 0cm; text-align:right;">16.5</p></td> <td style="width:1%;vertical-align:bottom;"> <p style="margin:0px 0px 0px 0cm">%</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;"> <p style="MARGIN: 0px 0px 0px 0cm; text-align:right;">16.5</p></td> <td style="width:1%;vertical-align:bottom;"> <p style="margin:0px 0px 0px 0cm">%</p></td></tr> <tr style="height:15px;background-color:#cceeff"> <td style="vertical-align:top;"> <p style="margin:0px">Income tax expense at statutory rate</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:9%;vertical-align:bottom;"> <p style="MARGIN: 0px 0px 0px 0cm; text-align:right;">50,519</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:9%;vertical-align:bottom;"> <p style="MARGIN: 0px 0px 0px 0cm; text-align:right;">7,529</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#ffffff"> <td style="vertical-align:top;"> <p style="margin:0px">Tax effect of non-deductible items</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:9%;vertical-align:bottom;"> <p style="MARGIN: 0px 0px 0px 0cm; text-align:right;">956</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:9%;vertical-align:bottom;"> <p style="MARGIN: 0px 0px 0px 0cm; text-align:right;">105</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#cceeff"> <td style="vertical-align:top;"> <p style="margin:0px">Tax effect of tax holiday</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;"> <p style="MARGIN: 0px 0px 0px 0cm; text-align:right;">(26,346</p></td> <td style="width:1%;vertical-align:bottom;"> <p style="margin:0px 0px 0px 0cm">)</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;"> <p style="MARGIN: 0px 0px 0px 0cm; text-align:right;">(7,634</p></td> <td style="width:1%;vertical-align:bottom;"> <p style="margin:0px 0px 0px 0cm">)</p></td></tr> <tr style="height:15px;background-color:#ffffff"> <td style="vertical-align:top;"> <p style="margin:0px">Income tax expense</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;"> <p style="margin:0px 0px 0px 0cm">$</p></td> <td style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;"> <p style="MARGIN: 0px 0px 0px 0cm; text-align:right;">25,129</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;"> <p style="margin:0px 0px 0px 0cm">$</p></td> <td style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;"> <p style="MARGIN: 0px 0px 0px 0cm; text-align:right;">-</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td></tr></table> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <p style="font-size:10pt;font-family:times new roman;margin:0px">The following table sets forth the significant components of the deferred tax liabilities of the Company as of September 30, 2020 and December 31, 2019:</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;" colspan="6"> <p style="MARGIN: 0px; text-align:center;"><strong>As of</strong></p></td> <td> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px"> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td colspan="2" style="width:9%;vertical-align:bottom;"> <p style="MARGIN: 0px; text-align:center;"><strong>September 30,</strong></p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td colspan="2" style="width:9%;vertical-align:bottom;"> <p style="MARGIN: 0px; text-align:center;"><strong>December 31,</strong></p></td> <td> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px"> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;" colspan="2"> <p style="MARGIN: 0px; text-align:center;"><strong>2020</strong></p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;" colspan="2"> <p style="MARGIN: 0px; text-align:center;"><strong>2019</strong></p></td> <td> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px"> <td> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td colspan="2" style="width:9%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td colspan="2" style="width:9%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px"> <td style="vertical-align:top;"> <p style="margin:0px">Deferred tax liabilities:</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td colspan="2" style="width:9%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td colspan="2" style="width:9%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#cceeff"> <td style="vertical-align:top;"> <p style="margin:0px">Accelerated depreciation</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;"> <p style="margin:0px 0px 0px 0cm">$</p></td> <td style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;"> <p style="MARGIN: 0px 0px 0px 0cm; text-align:right;">(3,455</p></td> <td style="width:1%;vertical-align:bottom;"> <p style="margin:0px 0px 0px 0cm">)</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;"> <p style="margin:0px 0px 0px 0cm">$</p></td> <td style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;"> <p style="MARGIN: 0px 0px 0px 0cm; text-align:right;">5,933</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td></tr></table> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">Apart from the transactions and balances detailed elsewhere in these accompanying condensed consolidated financial statements, the Company has no other significant or material related party transactions during the periods presented.</p></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><p style="font-size:10pt;font-family:times new roman;margin:0px">The Company is exposed to the following concentrations of risk:</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp;&nbsp; </p> <p style="font-size:10pt;font-family:times new roman;margin:0px">(a) Major customers </p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">For the three and nine months ended September 30, 2020,there was one single customer exceeding 10% of the Company&#8217;s revenue.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">For the three and nine months ended September 30, 2019,there was no single customer exceeding 10% of the Company&#8217;s revenue.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">All of the Company&#8217;s customers are located in Hong Kong.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">(b) Major vendor </p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">For the nine months ended September 30, 2020, two venders represented more than 10% of the Company&#8217;s operating cost. These vendors accounted for 85% and 15%, respectively, of the Company&#8217;s operating cost with no accounts payable at September 30, 2020.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">For the three months ended September 30, 2020, there was one vender represented more than 10% of the Company&#8217;s operating cost. This vendor accounted for 100% of the Company&#8217;s operating cost with no accounts payable at September 30, 2020.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">For the three and nine months ended September 30, 2019, there was one single vendor represented more than 10% of the Company&#8217;s operating cost. </p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">The Company&#8217;s vendor is located in Hong Kong.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">(c) Economic and political risk</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp; </p> <p style="font-size:10pt;font-family:times new roman;margin:0px">The Company&#8217;s major operations are conducted in Hong Kong. Accordingly, the political, economic, and legal environments in Hong Kong, as well as the general state of Hong Kong&#8217;s economy may influence the Company&#8217;s business, financial condition, and results of operations.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp; </p> <p style="font-size:10pt;font-family:times new roman;margin:0px">(d) Exchange rate risk</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <p style="font-size:10pt;font-family:times new roman;margin:0px">The Company cannot guarantee that the current exchange rate will remain steady; therefore there is a possibility that the Company could post the same amount of profit for two comparable periods and because of the fluctuating exchange rate actually post higher or lower profit depending on exchange rate of HKD converted to US$ on that date. The exchange rate could fluctuate depending on changes in political and economic environments without notice.</p></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">As of September 30, 2020, the Company has no material commitments or contingencies.</p></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">In accordance with ASC Topic 855, &#8220;<em>Subsequent Events</em>&#8221;, which establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before condensed consolidated financial statements are issued, the Company has evaluated all events or transactions that occurred after September 30, 2020, up through the date the Company issued the unaudited condensed consolidated financial statements.</p></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;"><font style="font-family:times new roman,serif">These accompanying condensed consolidated financial statements have been prepared in U.S. Dollars in conformity with generally accepted accounting principles in the United States of America (&#8220;U.S. GAAP&#8221;) for interim financial information pursuant to the rules and regulations of the Securities and Exchange Commission (the &#8220;SEC&#8221;). Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary to make the financial statements not misleading have been included. Operating results for the interim period ended September 30, 2020 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2020. The information included in this Form 10-Q should be read in conjunction with Management&#8217;s Discussion and Analysis, and the financial statements and notes thereto included in the Company&#8217;s Form 10/A for the fiscal year ended December 31, 2019, filed with the SEC on May 1, 2020.</font></p></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">In preparing these condensed consolidated financial statements, management makes estimates and assumptions that affect the reported amounts of assets and liabilities in the balance sheet and revenues and expenses during the periods reported. Actual results may differ from these estimates.</p></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">The condensed consolidated financial statements include the accounts of FJHL and its subsidiaries. All significant inter-company balances and transactions within the Company have been eliminated upon consolidation.</p></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">Cash and cash equivalents are carried at cost and represent cash on hand, demand deposits placed with banks or other financial institutions and all highly liquid investments with an original maturity of three months or less as of the purchase date of such investments.</p></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">Accounts receivable are recorded at the invoiced amount and do not bear interest, which are due within contractual payment terms, generally 30 to 90 days from completion of service. Credit is extended based on evaluation of a customer&#8217;s financial condition, the customer credit-worthiness and their payment history. Accounts receivable outstanding longer than the contractual payment terms are considered past due. Past due balances over 90 days and over a specified amount are reviewed individually for collectibility. At the end of fiscal year, the Company specifically evaluates individual customer&#8217;s financial condition, credit history, and the current economic conditions to monitor the progress of the collection of accounts receivables. The Company will consider the allowance for doubtful accounts for any estimated losses resulting from the inability of its customers to make required payments. For the receivables that are past due or not being paid according to payment terms, the appropriate actions are taken to exhaust all means of collection, including seeking legal resolution in a court of law. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company does not have any off-balance-sheet credit exposure related to its customers. As of September 30, 2020, there was no allowance for doubtful accounts.</p></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><p style="font-size:10pt;font-family:times new roman;margin:0px">Plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses, if any. Depreciation is calculated on the straight-line basis over the following expected useful lives from the date on which they become fully operational and after taking into account their estimated residual values:</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:15%;vertical-align:top;"> <p style="MARGIN: 0px; text-align:center;">Expected useful lives</p></td> <td style="width:1%;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#cceeff"> <td style="vertical-align:top;"> <p style="margin:0px">Computer equipment</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="MARGIN: 0px; text-align:center;">5 years</p></td> <td> <p style="margin:0px">&nbsp;</p></td></tr></table> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">Expenditures for repairs and maintenance are expensed as incurred. When assets have been retired or sold, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in the results of operations.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">Depreciation expense for the three months ended September 30, 2020 and 2019 were $1,932 and $637, respectively.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">Depreciation expense for the nine months ended September 30, 2020 and 2019 were $5,798 and $637, respectively.</p> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;</p></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">The Company adopted Accounting Standards Update (&#8220;ASU&#8221;) No. 2014-09, Revenue from Contracts with Customers (Topic 606) (&#8220;ASU 2014-09&#8221;) using the full retrospective transition method. The Company&#8217;s adoption of ASU 2014-09 did not have a material impact on the amount and timing of revenue recognized in its condensed consolidated financial statements.</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">&nbsp;</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">Under ASU 2014-09, the Company recognizes revenue when control of the promised goods or services is transferred to customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services.</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">&nbsp;</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">The Company applies the following five steps in order to determine the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its agreements:</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">&nbsp;</p> <table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td style="width:4%;vertical-align:top;"> <p style="MARGIN: 0px; text-align:justify;"><font style="font-size:14pt">&#8226;</font></p></td> <td style="vertical-align:top;"> <p style="MARGIN: 0px; text-align:justify;">identify the contract with a customer;</p></td></tr> <tr style="height:15px"> <td style="vertical-align:top;"> <p style="MARGIN: 0px; text-align:justify;"><font style="font-size:14pt">&#8226;</font></p></td> <td style="vertical-align:top;"> <p style="MARGIN: 0px; text-align:justify;">identify the performance obligations in the contract;</p></td></tr> <tr style="height:15px"> <td style="vertical-align:top;"> <p style="MARGIN: 0px; text-align:justify;"><font style="font-size:14pt">&#8226;</font></p></td> <td style="vertical-align:top;"> <p style="MARGIN: 0px; text-align:justify;">determine the transaction price;</p></td></tr> <tr style="height:15px"> <td style="vertical-align:top;"> <p style="MARGIN: 0px; text-align:justify;"><font style="font-size:14pt">&#8226;</font></p></td> <td style="vertical-align:top;"> <p style="MARGIN: 0px; text-align:justify;">allocate the transaction price to performance obligations in the contract; and</p></td></tr> <tr style="height:15px"> <td style="vertical-align:top;"> <p style="MARGIN: 0px; text-align:justify;"><font style="font-size:14pt">&#8226;</font></p></td> <td style="vertical-align:top;"> <p style="MARGIN: 0px; text-align:justify;">recognize revenue as the performance obligation is satisfied.</p></td></tr></table> <p style="font-size:10pt;font-family:times new roman;margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">The Company records the revenue from the sale of jewelry and healthcare supplement products during the period.</p></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">Cost of revenue consists primarily of the cost of goods sold, which are directly attributable to the sales of products.</p></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">The Company adopted the ASC 740 <em>Income tax</em> provisions of paragraph 740-10-25-13, which addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the condensed consolidated financial statements. Under paragraph 740-10-25-13, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the condensed consolidated financial statements from such a position should be measured based on the largest benefit that has a greater than fifty percent (50%) likelihood of being realized upon ultimate settlement. Paragraph 740-10-25-13 also provides guidance on de-recognition, classification, interest and penalties on income taxes, accounting in interim periods and requires increased disclosures. The Company had no material adjustments to its liabilities for unrecognized income tax benefits according to the provisions of paragraph 740-10-25-13.</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">&nbsp;</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">The estimated future tax effects of temporary differences between the tax basis of assets and liabilities are reported in the accompanying balance sheets, as well as tax credit carry-backs and carry-forwards. The Company periodically reviews the recoverability of deferred tax assets recorded on its balance sheets and provides valuation allowances as management deems necessary.</p></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">The Company did not take any uncertain tax positions and had no adjustments to its income tax liabilities or benefits pursuant to the ASC 740 provisions of Section 740-10-25 for the three and nine months ended September 30, 2020 and 2019.</p></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">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 transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the condensed consolidated statement of operations.</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">The reporting currency of the Company is United States Dollar (&#8220;US$&#8221;) and the accompanying condensed consolidated financial statements have been expressed in US$. In addition, the Company is operating in Hong Kong and maintain its books and record in its local currency, Hong Kong Dollars (&#8220;HKD&#8221;), which is a functional currency as being the primary currency of the economic environment in which their operations are conducted. In general, for consolidation purposes, assets and liabilities of its subsidiary whose functional currency is not US$ are translated into US$, in accordance with ASC Topic 830-30, &#8220; <em>Translation of Financial Statement</em>&#8221;, using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements of foreign subsidiary are recorded as a separate component of accumulated other comprehensive income within the statements of changes in stockholder&#8217;s equity.</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">Translation of amounts from HKD into US$ has been made at the following exchange rates for the period ended September 30, 2020 and 2019:</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p> <table style="border-spacing:0;text-align:left;font:10pt times new roman;width:100%" cellpadding="0"> <tr style="height:15px"> <td> <p style="margin:0px">&nbsp;</p></td> <td style="white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="hdcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;" colspan="2"> <p style="MARGIN: 0px 0px 0px -2.1pt; text-align:center;"><strong>September</strong></p> <p style="MARGIN: 0px 0px 0px -2.1pt; text-align:center;"><strong>30, 2020</strong></p></td> <td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> <p style="margin:0px"><strong>&nbsp;</strong></p></td> <td style="white-space: nowrap;"> <p style="margin:0px"><strong>&nbsp;</strong></p></td> <td class="hdcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;" colspan="2"> <p style="MARGIN: 0px 0px 0px -2.1pt; text-align:center;"><strong>September</strong></p> <p style="MARGIN: 0px 0px 0px -2.1pt; text-align:center;"><strong>30, 2019</strong></p></td> <td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#cceeff"> <td style="vertical-align:top;"> <p style="margin:0px">Period-end HKD:US$ exchange rate</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">0.12903</td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">0.12740</td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#ffffff"> <td style="vertical-align:top;"> <p style="margin:0px 0px 0px 0in">Period average HKD:US$ exchange rate</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 3px double;width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">0.12885</td> <td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 3px double;width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">0.12746</td> <td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td></tr></table></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">ASC Topic 220, &#8220;<em>Comprehensive Income</em>&#8221;, establishes standards for reporting and display of comprehensive income, its components and accumulated balances. Comprehensive income as defined includes all changes in equity during a period from non-owner sources. Accumulated other comprehensive income, as presented in the accompanying condensed consolidated statements of changes in stockholders&#8217; equity, consists of changes in unrealized gains and losses on foreign currency translation. This comprehensive income is not included in the computation of income tax expense or benefit.</p></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">ASC Topic 280, &#8220;<em>Segment Reporting</em>&#8221; establishes standards for reporting information about operating segments on a basis consistent with the Company&#8217;s internal organization structure as well as information about geographical areas, business segments and major customers in condensed consolidated financial statements. For the period ended September 30, 2020 and 2019, the Company operates in one reportable operating segment in Hong Kong.</p></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">The Company follows the ASC 850-10, <em>Related Party</em> for the identification of related parties and disclosure of related party transactions.</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">&nbsp;</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">Pursuant to section 850-10-20 the related parties include a)&nbsp;affiliates of the Company; b) entities for which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of section 825&#8211;10&#8211;15, to be accounted for by the equity method by the investing entity; c) trusts for the benefit of employees, such as pension and Income-sharing trusts that are managed by or under the trusteeship of management; d) principal owners of the Company; e) management of the Company; f) other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests; and g)&nbsp;other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests.</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">&nbsp;</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">The condensed consolidated financial statements shall include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business. However, disclosure of transactions that are eliminated in the preparation of consolidated or combined financial statements is not required in those statements. The disclosures shall include: a)&nbsp;the nature of the relationship(s) involved; b) a description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which income statements are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the financial statements; c)&nbsp;the dollar amounts of transactions for each of the periods for which income statements are presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and d)&nbsp;amount due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement.</p></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">The Company follows the ASC 450-20, <em>Commitments</em> to report accounting for contingencies. Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or un-asserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or un-asserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein.</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">&nbsp;</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company&#8217;s condensed consolidated financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed.</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">&nbsp;</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. Management does not believe, based upon information available at this time that these matters will have a material adverse effect on the Company&#8217;s financial position, results of operations or cash flows. However, there is no assurance that such matters will not materially and adversely affect the Company&#8217;s business, financial position, and results of operations or cash flows.</p></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">The Company follows paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and has adopted paragraph 820-10-35-37 of the FASB Accounting Standards Codification (&#8220;Paragraph 820-10-35-37&#8221;) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 of the FASB Accounting Standards Codification establishes a framework for measuring fair value in generally accepted accounting principles (GAAP), and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, paragraph 820-10-35-37 of the FASB Accounting Standards Codification establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by paragraph 820-10-35-37 of the FASB Accounting Standards Codification are described below:</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">&nbsp;</p> <table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td style="width:10%;vertical-align:top;"> <p style="margin:0px">Level 1</p></td> <td style="width:2%;"> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.</p></td></tr> <tr style="height:15px"> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px"> <td style="vertical-align:top;"> <p style="margin:0px">Level 2</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.</p></td></tr> <tr style="height:15px"> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px"> <td style="vertical-align:top;"> <p style="margin:0px">Level 3</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">Pricing inputs that are generally observable inputs and not corroborated by market data.</p></td></tr></table> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">&nbsp;</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable.</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">&nbsp;</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument.</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">&nbsp;</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">The carrying amounts of the Company&#8217;s financial assets and liabilities, such as cash and cash equivalents, approximate their fair values because of the short maturity of these instruments.</p></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">In January 2017, the Financial Accounting Standard Board (&#8220;FASB&#8221;) issued ASU 2017-04, <em>Intangibles - Goodwill and Other (Topic 350)</em>&nbsp;: Simplifying the Accounting for Goodwill Impairment (&#8220;ASU 2017-04&#8221;). ASU 2017-04 removes Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation. A goodwill impairment will now be the amount by which a reporting unit&#8217;s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. This standard, which will be effective for the Company beginning in the first quarter of fiscal year 2020, is required to be applied prospectively. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company is currently evaluating the impact this standard will have on its condensed consolidated financial statements.</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">&nbsp;</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">In June 2018, the FASB issued ASU 2018-07, <em>Improvements to Nonemployee Share-Based Payment Accounting</em>&nbsp;(&#8220;ASU 2018-07&#8221;),&nbsp;which supersedes ASC 505-50 and expands the scope of ASC 718 to include all share-based payments arrangements related to the acquisition of goods and services from both employees and nonemployees. For public companies, the amendments are effective for annual reporting periods beginning after December 15, 2018, including interim periods within those annual periods. Early adoption is permitted, but no earlier than a company&#8217;s adoption date of ASC 606. The Company does not believe that the adoption of ASU 2018-07 will have a material impact on the Company&#8217;s condensed consolidated financial statements.</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">&nbsp;&nbsp; </p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">In August 2018, the FASB issued ASU No. 2018-15, <em>Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer&#8217;s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract</em>, which amended its guidance for costs of implementing a cloud computing service arrangement to align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. This new standard also requires customers to expense the capitalized implementation costs of a hosting arrangement that is a service contract over the term of the hosting arrangement. This new standard becomes effective for the Company in the first quarter of fiscal year 2020, with early adoption permitted. This new standard can be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. The Company is evaluating the impact of adopting this amendment to its condensed consolidated financial statements.</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">&nbsp;</p> <p style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; MARGIN: 0px; text-align:justify;">The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and do not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations.</p></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td style="BORDER-BOTTOM: 1px solid;width:15%;vertical-align:bottom;"> <p style="margin:0px">Name</p></td> <td style="width:2%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:15%;vertical-align:bottom;"> <p style="margin:0px">Place of incorporation</p> <p style="margin:0px">and kind of </p> <p style="margin:0px">legal entity</p></td> <td style="width:2%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:15%;vertical-align:bottom;"> <p style="margin:0px">Principal activities</p> <p style="margin:0px">and place of operation</p></td> <td style="width:2%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:15%;vertical-align:bottom;"> <p style="margin:0px">Particulars of registered/ paid up share</p> <p style="margin:0px">capital</p></td> <td style="width:2%;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:15%;vertical-align:bottom;"> <p style="margin:0px">Effective interest</p> <p style="margin:0px">held</p></td></tr> <tr style="height:15px"> <td> <p style="MARGIN: 0px; text-align:justify;">&nbsp;</p></td> <td> <p style="MARGIN: 0px; text-align:justify;">&nbsp;</p></td> <td> <p style="MARGIN: 0px; text-align:justify;">&nbsp;</p></td> <td> <p style="MARGIN: 0px; text-align:justify;">&nbsp;</p></td> <td> <p style="MARGIN: 0px; text-align:justify;">&nbsp;</p></td> <td> <p style="MARGIN: 0px; text-align:justify;">&nbsp;</p></td> <td> <p style="MARGIN: 0px; text-align:justify;">&nbsp;</p></td> <td> <p style="MARGIN: 0px; text-align:justify;">&nbsp;</p></td> <td> <p style="MARGIN: 0px; text-align:justify;">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#cceeff"> <td style="vertical-align:top;"> <p style="margin:0px">Fovea International Holdings Limited</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">British Virgin Islands</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">Investment holding</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">100 ordinary shares at par value of US$1</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">100%</p></td></tr> <tr style="height:15px;background-color:#ffffff"> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#cceeff"> <td style="vertical-align:top;"> <p style="margin:0px">Fovea Jewellery Holdings Limited</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">Hong Kong</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">Sales and marketing in Hong Kong</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">1 ordinary share for HK$1</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">100%</p></td></tr> <tr style="height:15px;background-color:#ffffff"> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#cceeff"> <td style="vertical-align:top;"> <p style="margin:0px">Gold Shiny International Limited</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">British Virgin Islands</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">Investment holding</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">115 ordinary shares at par value of US$1</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">100%</p></td></tr> <tr style="height:15px;background-color:#ffffff"> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#cceeff"> <td style="vertical-align:top;"> <p style="margin:0px">Gold Shiny (Asia) Limited</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">Hong Kong</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">Sales and marketing in Hong Kong</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">1 ordinary share for HK$1</p></td> <td> <p style="margin:0px">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="margin:0px">100%</p></td></tr></table></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><table style="border-spacing:0;font-size:10pt;width:100%" cellpadding="0"> <tr style="height:15px"> <td> <p style="MARGIN: 0px; text-align:justify;">&nbsp;</p></td> <td style="width:1%;"> <p style="MARGIN: 0px; text-align:justify;">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:15%;vertical-align:top;"> <p style="MARGIN: 0px 0px 0px -1.4pt; text-align:center;">Expected useful lives</p></td> <td style="width:1%;"> <p style="MARGIN: 0px; text-align:justify;">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#cceeff"> <td style="vertical-align:top;"> <p style="MARGIN: 0px; text-align:justify;">Computer equipment</p></td> <td> <p style="MARGIN: 0px; text-align:justify;">&nbsp;</p></td> <td style="vertical-align:top;"> <p style="MARGIN: 0px; text-align:center;">5 years</p></td> <td> <p style="MARGIN: 0px; text-align:justify;">&nbsp;</p></td></tr></table></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><table style="border-spacing:0;text-align:left;font:10pt times new roman;width:100%" cellpadding="0"> <tr style="height:15px"> <td> <p style="margin:0px">&nbsp;</p></td> <td style="white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="hdcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;" colspan="2"> <p style="MARGIN: 0px 0px 0px -2.1pt; text-align:center;"><strong>September</strong></p> <p style="MARGIN: 0px 0px 0px -2.1pt; text-align:center;"><strong>30, 2020</strong></p></td> <td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> <p style="margin:0px"><strong>&nbsp;</strong></p></td> <td style="white-space: nowrap;"> <p style="margin:0px"><strong>&nbsp;</strong></p></td> <td class="hdcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;" colspan="2"> <p style="MARGIN: 0px 0px 0px -2.1pt; text-align:center;"><strong>September</strong></p> <p style="MARGIN: 0px 0px 0px -2.1pt; text-align:center;"><strong>30, 2019</strong></p></td> <td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#cceeff"> <td style="vertical-align:top;"> <p style="margin:0px">Period-end HKD:US$ exchange rate</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">0.12903</td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">0.12740</td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#ffffff"> <td style="vertical-align:top;"> <p style="margin:0px 0px 0px 0in">Period average HKD:US$ exchange rate</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 3px double;width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">0.12885</td> <td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 3px double;width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">0.12746</td> <td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td></tr></table></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><table style="border-spacing:0;text-align:left;font:10pt times new roman;width:100%" cellpadding="0"> <tr style="height:15px"> <td> <p style="margin:0px">&nbsp;</p></td> <td style="white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="hdcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;" colspan="6"> <p style="MARGIN: 0px 0px 0px -1.5pt; text-align:center;"><strong>Nine months ended September 30,</strong></p></td> <td style="white-space: nowrap;"> <p style="margin:0px"><strong>&nbsp;</strong></p></td></tr> <tr style="height:15px"> <td> <p style="margin:0px"><strong>&nbsp;</strong></p></td> <td style="white-space: nowrap;"> <p style="margin:0px"><strong>&nbsp;</strong></p></td> <td class="hdcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;" colspan="2"> <p style="MARGIN: 0px; text-align:center;"><strong>2020</strong></p></td> <td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> <p style="margin:0px"><strong>&nbsp;</strong></p></td> <td style="white-space: nowrap;"> <p style="margin:0px"><strong>&nbsp;</strong></p></td> <td class="hdcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;" colspan="2"> <p style="MARGIN: 0px 0px 0px -2.1pt; text-align:center;"><strong>2019</strong></p></td> <td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px"> <td> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="ffcell" colspan="2" style="width:9%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="ffcell" colspan="2" style="width:9%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#cceeff"> <td style="vertical-align:top;"> <p style="margin:0px">Current tax</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;vertical-align:bottom;white-space: nowrap;">$</td> <td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">25,129</td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;vertical-align:bottom;white-space: nowrap;">$</td> <td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">-</td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#ffffff"> <td style="vertical-align:top;"> <p style="margin:0px">Deferred tax</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="ffcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:right;">(3,455</td> <td style="PADDING-BOTTOM: 1px;width:1%;vertical-align:bottom;white-space: nowrap;">)</td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="ffcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:right;">6,204</td> <td style="PADDING-BOTTOM: 1px;width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#cceeff"> <td> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="ffcell" style="width:9%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="ffcell" style="width:9%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#ffffff"> <td style="vertical-align:top;"> <p style="margin:0px">Income tax expense</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td> <td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">21,674</td> <td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td> <td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">6,204</td> <td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td></tr></table></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><table style="border-spacing:0;text-align:left;font:10pt times new roman;width:100%" cellpadding="0"> <tr style="height:15px"> <td> <p style="margin:0px">&nbsp;</p></td> <td style="white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="hdcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;" colspan="6"> <p style="MARGIN: 0px 0px 0px 0.55pt; text-align:center;"><strong>Nine months ended September 30,</strong></p></td> <td style="white-space: nowrap;"> <p style="margin:0px"><strong>&nbsp;</strong></p></td></tr> <tr style="height:15px"> <td> <p style="margin:0px"><strong>&nbsp;</strong></p></td> <td style="white-space: nowrap;"> <p style="margin:0px"><strong>&nbsp;</strong></p></td> <td class="hdcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;" colspan="2"> <p style="MARGIN: 0px; text-align:center;"><strong>2020</strong></p></td> <td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> <p style="margin:0px"><strong>&nbsp;</strong></p></td> <td style="white-space: nowrap;"> <p style="margin:0px"><strong>&nbsp;</strong></p></td> <td class="hdcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;" colspan="2"> <p style="MARGIN: 0px; text-align:center;"><strong>2019</strong></p></td> <td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px"> <td> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="ffcell" colspan="2" style="width:9%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="ffcell" colspan="2" style="width:9%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#cceeff"> <td style="vertical-align:top;"> <p style="MARGIN: 0px; text-align:justify;">Income before income taxes </p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;vertical-align:bottom;white-space: nowrap;">$</td> <td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">306,179</td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;vertical-align:bottom;white-space: nowrap;">$</td> <td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">45,629</td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#ffffff"> <td style="vertical-align:top;"> <p style="MARGIN: 0px; text-align:justify;">Statutory income tax rate</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="ffcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:right;">16.5</td> <td style="PADDING-BOTTOM: 1px;width:1%;vertical-align:bottom;white-space: nowrap;">%</td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="ffcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:right;">16.5</td> <td style="PADDING-BOTTOM: 1px;width:1%;vertical-align:bottom;white-space: nowrap;">%</td></tr> <tr style="height:15px;background-color:#cceeff"> <td style="vertical-align:top;"> <p style="margin:0px">Income tax expense at statutory rate</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">50,519</td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">7,529</td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#ffffff"> <td style="vertical-align:top;"> <p style="margin:0px">Tax effect of non-deductible items</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">956</td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="ffcell" style="width:9%;vertical-align:bottom;text-align:right;">105</td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#cceeff"> <td style="vertical-align:top;"> <p style="margin:0px">Tax effect of tax holiday</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="ffcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:right;">(26,346</td> <td style="PADDING-BOTTOM: 1px;width:1%;vertical-align:bottom;white-space: nowrap;">)</td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 1px solid;width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="ffcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:right;">(7,634</td> <td style="PADDING-BOTTOM: 1px;width:1%;vertical-align:bottom;white-space: nowrap;">)</td></tr> <tr style="height:15px;background-color:#ffffff"> <td style="vertical-align:top;"> <p style="margin:0px">Income tax expense</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td> <td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">25,129</td> <td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td> <td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">-</td> <td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td></tr></table></div> <div style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN"><table style="border-spacing:0;text-align:left;font:10pt times new roman;width:100%" cellpadding="0"> <tr style="height:15px"> <td> <p style="margin:0px">&nbsp;</p></td> <td style="white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="hdcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;" colspan="6"> <p style="MARGIN: 0px; text-align:center;"><strong>As of</strong></p></td> <td style="white-space: nowrap;"> <p style="margin:0px"><strong>&nbsp;</strong></p></td></tr> <tr style="height:15px"> <td> <p style="margin:0px"><strong>&nbsp;</strong></p></td> <td style="white-space: nowrap;"> <p style="margin:0px"><strong>&nbsp;</strong></p></td> <td class="hdcell" colspan="2" style="width:9%;vertical-align:bottom;text-align:center;"> <p style="MARGIN: 0px; text-align:center;"><strong>September 30,</strong></p></td> <td style="white-space: nowrap;"> <p style="margin:0px"><strong>&nbsp;</strong></p></td> <td style="white-space: nowrap;"> <p style="margin:0px"><strong>&nbsp;</strong></p></td> <td class="hdcell" colspan="2" style="width:9%;vertical-align:bottom;text-align:center;"> <p style="MARGIN: 0px; text-align:center;"><strong>December 31,</strong></p></td> <td style="white-space: nowrap;"> <p style="margin:0px"><strong>&nbsp;</strong></p></td></tr> <tr style="height:15px"> <td> <p style="margin:0px"><strong>&nbsp;</strong></p></td> <td style="white-space: nowrap;"> <p style="margin:0px"><strong>&nbsp;</strong></p></td> <td class="hdcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;" colspan="2"> <p style="MARGIN: 0px; text-align:center;"><strong>2020</strong></p></td> <td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> <p style="margin:0px"><strong>&nbsp;</strong></p></td> <td style="white-space: nowrap;"> <p style="margin:0px"><strong>&nbsp;</strong></p></td> <td class="hdcell" style="BORDER-BOTTOM: 1px solid;width:9%;vertical-align:bottom;text-align:center;" colspan="2"> <p style="MARGIN: 0px; text-align:center;"><strong>2019</strong></p></td> <td style="PADDING-BOTTOM: 1px;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px"> <td> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="ffcell" colspan="2" style="width:9%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="ffcell" colspan="2" style="width:9%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px"> <td style="vertical-align:top;"> <p style="MARGIN: 0px; text-align:justify;">Deferred tax liabilities:</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="ffcell" colspan="2" style="width:9%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td class="ffcell" colspan="2" style="width:9%;"> <p style="margin:0px">&nbsp;</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td></tr> <tr style="height:15px;background-color:#cceeff"> <td style="vertical-align:top;"> <p style="MARGIN: 0px; text-align:justify;">Accelerated depreciation</p></td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td> <td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">(3,455</td> <td style="PADDING-BOTTOM: 3px;width:1%;vertical-align:bottom;white-space: nowrap;">)</td> <td style="width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: 3px double;width:1%;vertical-align:bottom;white-space: nowrap;">$</td> <td class="ffcell" style="BORDER-BOTTOM: 3px double;width:9%;vertical-align:bottom;text-align:right;">5,933</td> <td style="PADDING-BOTTOM: 3px;width:1%;white-space: nowrap;"> <p style="margin:0px">&nbsp;</p></td></tr></table></div> British Virgin Islands Investment holding 100 ordinary shares at par value of US$1 1 Hong Kong Sales and marketing in Hong Kong 1 ordinary share for HK$1 1 British Virgin Islands 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Cover - shares
9 Months Ended
Sep. 30, 2020
Nov. 12, 2020
Cover [Abstract]    
Entity Registrant Name Fovea Jewelry Holdings Ltd.  
Entity Central Index Key 0000850971  
Document Type 10-Q  
Amendment Flag false  
Current Fiscal Year End Date --12-31  
Entity Small Business true  
Entity Shell Company false  
Entity Emerging Growth Company false  
Entity Current Reporting Status Yes  
Document Period End Date Sep. 30, 2020  
Entity Filer Category Non-accelerated Filer  
Document Fiscal Period Focus Q3  
Document Fiscal Year Focus 2020  
Entity Common Stock Shares Outstanding   10,161,039
Document Quarterly Report true  
Document Transition Report false  
Entity Interactive Data Current Yes  
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CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)
Sep. 30, 2020
Dec. 31, 2019
Current asset:    
Accounts receivable $ 543,639 $ 0
Cash and cash equivalents 46,755 31,380
Total current assets 590,394 31,380
Non-current asset:    
Plant and equipment 30,322 35,957
TOTAL ASSETS 620,716 67,337
Current liabilities:    
Accounts payable 271,812 0
Accrued liabilities and other payables 19,935 30,643
Income tax payable 25,399 235
Deferred tax liabilities 2,502 5,933
Amount due to a director 2,062 0
Total current liabilities 321,710 36,811
TOTAL LIABILITIES 321,710 36,811
Commitments and contingencies 0 0
Preferred stock value 0 0
Common stock, $0.001 par value; 2,000,000,000 shares authorized; 10,161,039 and 10,161,039 shares issued and outstanding as of September 30, 2020 and December 31, 2019, respectively 10,161 10,161
Accumulated other comprehensive (loss) income (15,656) 369
Retained earnings 303,501 18,996
Stockholders' equity 299,006 30,526
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY 620,716 67,337
Preferred Stock Series A [Member]    
Current liabilities:    
Preferred stock value $ 1,000 $ 1,000
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CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares
Sep. 30, 2020
Dec. 31, 2019
STOCKHOLDERS' EQUITY    
Preferred stock, shares par value $ 0.001 $ 0.001
Preferred stock, shares authorized 5,000,000 5,000,000
Preferred stock, shares issued 0 0
Preferred stock, shares outstanding 0 0
Common stock, shares par value $ 0.001 $ 0.001
Common stock, shares authorized 2,000,000,000 2,000,000,000
Common stock, shares issued 10,161,039 10,161,039
Common stock, shares outstanding 10,161,039 10,161,039
Preferred Stock Series A [Member]    
STOCKHOLDERS' EQUITY    
Preferred stock, shares par value $ 0.001 $ 0.001
Preferred stock, shares authorized 1,000,000 1,000,000
Preferred stock, shares issued 1,000,000 1,000,000
Preferred stock, shares outstanding 1,000,000 1,000,000
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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (Unaudited) - USD ($)
3 Months Ended 9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (Unaudited)        
Revenue, net $ 542,900 $ 25,919 $ 942,965 $ 109,208
Cost of revenue (271,443) (10,209) (604,566) (54,912)
Gross profit 271,457 15,710 338,399 54,296
Operating expenses:        
General and administrative expenses (8,630) (5,989) (32,220) (8,667)
Total operating expenses (8,630) (5,989) (32,220) (8,667)
INCOME BEFORE INCOME TAXES 262,827 9,721 306,179 45,629
Income tax expenses (22,312) (6,204) (21,674) (6,204)
NET INCOME 240,515 3,517 284,505 39,425
Other comprehensive income (loss):        
- Foreign currency adjustment gain (loss) 326 (161) (16,025) (20)
COMPREHENSIVE INCOME $ 240,841 $ 3,356 $ 268,480 $ 39,405
Net income per share - Basic and Diluted $ 0.02 $ 0.00 $ 0.03 $ 0.00
Weighted average common shares outstanding        
- Basic and Diluted 10,161,039 10,161,039 10,161,039 10,161,039
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CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY (DEFICIT) (Unaudited) - USD ($)
Total
Series A Preferred Stock
Common Stock
Accumulated other comprehensive income (loss)
(Accumulated Losses) Retained Earnings
Balance, shares at Dec. 31, 2018   1,000,000 10,161,039    
Balance, amount at Dec. 31, 2018 $ (7,543) $ 1,000 $ 10,161 $ 0 $ (18,704)
Foreign currency translation adjustment 0 0 0 0 0
Net income for the period 0 $ 0 $ 0 0 0
Balance, shares at Mar. 31, 2019   1,000,000 10,161,039    
Balance, amount at Mar. 31, 2019 (7,543) $ 1,000 $ 10,161 0 (18,704)
Balance, shares at Dec. 31, 2018   1,000,000 10,161,039    
Balance, amount at Dec. 31, 2018 (7,543) $ 1,000 $ 10,161 0 (18,704)
Net income for the period 39,425        
Balance, shares at Sep. 30, 2019   1,000,000 10,161,039    
Balance, amount at Sep. 30, 2019 31,862 $ 1,000 $ 10,161 (20) 20,721
Balance, shares at Mar. 31, 2019   1,000,000 10,161,039    
Balance, amount at Mar. 31, 2019 (7,543) $ 1,000 $ 10,161 0 (18,704)
Foreign currency translation adjustment 141 0 0 141 0
Net income for the period 35,908 $ 0 $ 0 0 35,908
Balance, shares at Jun. 30, 2019   1,000,000 10,161,039    
Balance, amount at Jun. 30, 2019 28,506 $ 1,000 $ 10,161 141 17,204
Foreign currency translation adjustment (161) 0 0 (161) 0
Net income for the period 3,517 $ 0 $ 0 0 3,517
Balance, shares at Sep. 30, 2019   1,000,000 10,161,039    
Balance, amount at Sep. 30, 2019 31,862 $ 1,000 $ 10,161 (20) 20,721
Balance, shares at Dec. 31, 2019   1,000,000 10,161,039    
Balance, amount at Dec. 31, 2019 30,526 $ 1,000 $ 10,161 369 18,996
Foreign currency translation adjustment (17,977) 0 0 (17,977) 0
Net income for the period 13,510 $ 0 $ 0 0 13,510
Balance, shares at Mar. 31, 2020   1,000,000 10,161,039    
Balance, amount at Mar. 31, 2020 26,059 $ 1,000 $ 10,161 (17,608) 32,506
Balance, shares at Dec. 31, 2019   1,000,000 10,161,039    
Balance, amount at Dec. 31, 2019 30,526 $ 1,000 $ 10,161 369 18,996
Net income for the period 284,505        
Balance, shares at Sep. 30, 2020   1,000,000 10,161,039    
Balance, amount at Sep. 30, 2020 299,006 $ 1,000 $ 10,161 (15,656) 303,501
Balance, shares at Mar. 31, 2020   1,000,000 10,161,039    
Balance, amount at Mar. 31, 2020 26,059 $ 1,000 $ 10,161 (17,608) 32,506
Foreign currency translation adjustment 1,626 0 0 1,626 0
Net income for the period 30,480 $ 0 $ 0 0 30,480
Balance, shares at Jun. 30, 2020   1,000,000 10,161,039    
Balance, amount at Jun. 30, 2020 58,165 $ 1,000 $ 10,161 (15,982) 62,986
Foreign currency translation adjustment 326 0 0 326 0
Net income for the period 240,515 $ 0 $ 0 0 240,515
Balance, shares at Sep. 30, 2020   1,000,000 10,161,039    
Balance, amount at Sep. 30, 2020 $ 299,006 $ 1,000 $ 10,161 $ (15,656) $ 303,501
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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($)
9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Cash flow from operating activities:    
Net income $ 284,505 $ 39,425
Adjustments to reconcile net income to net cash generated from operating activities:    
Depreciation of plant and equipment 5,798 637
Change in operating assets and liabilities:    
Accounts receivable (543,639) 0
Deferred tax liabilities (3,431) 6,204
Tax payable 25,164 0
Accounts payable 271,812 0
Accrued liabilities and other payables (10,708) 0
Net cash provided by operating activities 29,501 46,266
Cash flow from investing activities:    
Purchase of property, plant and equipment 0 38,220
Net cash used in investing activities 0 (38,220)
Cash flow from financing activities:    
Amount due to a director 2,062 0
Net cash provided by financing activities 2,062 0
Foreign currency translation adjustment (16,188) (23)
Net change in cash and cash equivalents 15,375 8,023
BEGINNING OF PERIOD 31,380 100
END OF PERIOD 46,755 8,123
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:    
Cash paid for income taxes 0 0
Cash paid for interest $ 0 $ 0
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DESCRIPTION OF BUSINESS AND ORGANIZATION
9 Months Ended
Sep. 30, 2020
DESCRIPTION OF BUSINESS AND ORGANIZATION  
NOTE 1 - DESCRIPTION OF BUSINESS AND ORGANIZATION

Fovea Jewelry Holdings, Ltd (the “Company” or “FJHL”) was originally founded on February 1, 2006 as Dycam, Inc. In March 2006, the Company changed its name to Mekju Processing, Inc. In November 2006, the Company changed its name to Auxium Technologies, Inc. In November 2014, the Company changed its name to Pure Hospitality Solutions, Inc. On November 2, 2015, the Company changed its name to Wincash Resources, Inc. In early 2018, the Board of Directors of the Company deemed it in the best interests of the Company and its shareholders to switch directions and become involved in the business of the collection and ultimately the sale of diamond jewelry.

                   

Effective September 26, 2018, the Company changed its name from Wincash Resources, Inc. to Fovea Jewelry Holdings, Ltd. The Financial Industry Regulatory Authority and the OTC Markets Group, Inc. recognized the name change on February 3, 2018. Further, in connection with changing its name, the Company changed its trading symbol to FJHL.

                  

As a result of the change in business, the Company redomiciled from Nevada to Wyoming on March 4, 2019.

               

Currently, the Company through its subsidiaries, mainly commenced to operate an online store to sell the quality jewelry at affordable prices on www.fovea-jewellery.com. The goal is to “Deliver A Better Living”. All products selling on the online store are with great quality, natural, socially responsible and niche. This business was commenced its operation in Hong Kong from January 1, 2019.

                 

On March 6, 2020, the Company approved by the state government of Wyoming and effectuated a 1 for 10,000 reverse stock split. The number of authorized shares remains unchanged. All share and per share information in this financial statements and footnotes have been retroactively adjusted for all periods presented, unless otherwise indicated, to give effect to the reverse stock split.

                   

On March 20, 2020, the Company consummated the Share Exchange Transaction among Gold Shiny International Limited (“GSIL”) and its shareholders. The Company acquired all of the issued and outstanding shares of GSIL from GSIL’s shareholders, in exchange for 10,000,000 shares of the issued and outstanding common stock. Upon completion of the Share Exchange Transaction, GSIL became a 100% owed subsidiary of the Company.

                   

Prior to the acquisition, the Company was considered as a shell company due to its nominal assets and limited operation. Upon the acquisition, GSIL will comprise the ongoing operations of the combined entity, GSIL is deemed to be the accounting acquirer for accounting purposes. The transaction will be treated as a recapitalization of the Company. Accordingly, the consolidated assets, liabilities and results of operations of the Company will become the historical financial statements of GSIL, and the Company’s assets, liabilities and results of operations will be consolidated with GSIL beginning on the acquisition date. GSIL was the legal acquiree but deemed to be the accounting acquirer. The Company was the legal acquirer but deemed to be the accounting acquiree in the reverse merger. The historical financial statements prior to the acquisition are those of the accounting acquirer (GSIL). Historical stockholders’ equity of the accounting acquirer prior to the merger are retroactively restated (a recapitalization) for the equivalent number of shares received in the merger. Operations prior to the merger are those of the acquirer. After completion of the share exchange transaction, the Company’s consolidated financial statements include the assets and liabilities, the operations and cash flow of the accounting acquirer.

                

Description of subsidiaries

            

Name

 

Place of incorporation

and kind of

legal entity

 

Principal activities

and place of operation

 

Particulars of registered/ paid up share

capital

 

Effective interest

held

 

 

 

 

 

 

 

 

 

Fovea International Holdings Limited

 

British Virgin Islands

 

Investment holding

 

100 ordinary shares at par value of US$1

 

100%

 

 

 

 

 

 

 

 

 

Fovea Jewellery Holdings Limited

 

Hong Kong

 

Sales and marketing in Hong Kong

 

1 ordinary share for HK$1

 

100%

 

 

 

 

 

 

 

 

 

Gold Shiny International Limited

 

British Virgin Islands

 

Investment holding

 

115 ordinary shares at par value of US$1

 

100%

 

 

 

 

 

 

 

 

 

Gold Shiny (Asia) Limited

 

Hong Kong

 

Sales and marketing in Hong Kong

 

1 ordinary share for HK$1

 

100%

                          

The Company and its subsidiaries are hereinafter referred to as (the “Company”).

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
9 Months Ended
Sep. 30, 2020
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES  
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The accompanying condensed consolidated financial statements reflect the application of certain significant accounting policies as described in this note and elsewhere in the accompanying condensed consolidated financial statements and notes.

 

·

Basis of presentation

 

These accompanying condensed consolidated financial statements have been prepared in U.S. Dollars in conformity with generally accepted accounting principles in the United States of America (“U.S. GAAP”) for interim financial information pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary to make the financial statements not misleading have been included. Operating results for the interim period ended September 30, 2020 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2020. The information included in this Form 10-Q should be read in conjunction with Management’s Discussion and Analysis, and the financial statements and notes thereto included in the Company’s Form 10/A for the fiscal year ended December 31, 2019, filed with the SEC on May 1, 2020.

 

·

Use of estimates and assumptions

 

In preparing these condensed consolidated financial statements, management makes estimates and assumptions that affect the reported amounts of assets and liabilities in the balance sheet and revenues and expenses during the periods reported. Actual results may differ from these estimates.

 

·

Basis of consolidation

 

The condensed consolidated financial statements include the accounts of FJHL and its subsidiaries. All significant inter-company balances and transactions within the Company have been eliminated upon consolidation.

 

·

Cash and cash equivalents

 

Cash and cash equivalents are carried at cost and represent cash on hand, demand deposits placed with banks or other financial institutions and all highly liquid investments with an original maturity of three months or less as of the purchase date of such investments.

 

·

Accounts receivable

 

Accounts receivable are recorded at the invoiced amount and do not bear interest, which are due within contractual payment terms, generally 30 to 90 days from completion of service. Credit is extended based on evaluation of a customer’s financial condition, the customer credit-worthiness and their payment history. Accounts receivable outstanding longer than the contractual payment terms are considered past due. Past due balances over 90 days and over a specified amount are reviewed individually for collectibility. At the end of fiscal year, the Company specifically evaluates individual customer’s financial condition, credit history, and the current economic conditions to monitor the progress of the collection of accounts receivables. The Company will consider the allowance for doubtful accounts for any estimated losses resulting from the inability of its customers to make required payments. For the receivables that are past due or not being paid according to payment terms, the appropriate actions are taken to exhaust all means of collection, including seeking legal resolution in a court of law. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company does not have any off-balance-sheet credit exposure related to its customers. As of September 30, 2020, there was no allowance for doubtful accounts.

 

·

Plant and equipment

 

Plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses, if any. Depreciation is calculated on the straight-line basis over the following expected useful lives from the date on which they become fully operational and after taking into account their estimated residual values:

 

 

 

Expected useful lives

 

Computer equipment

 

5 years

 

 

Expenditures for repairs and maintenance are expensed as incurred. When assets have been retired or sold, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in the results of operations.

 

Depreciation expense for the three months ended September 30, 2020 and 2019 were $1,932 and $637, respectively.

 

Depreciation expense for the nine months ended September 30, 2020 and 2019 were $5,798 and $637, respectively.

 

·

Revenue recognition

 

The Company adopted Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”) using the full retrospective transition method. The Company’s adoption of ASU 2014-09 did not have a material impact on the amount and timing of revenue recognized in its condensed consolidated financial statements.

 

Under ASU 2014-09, the Company recognizes revenue when control of the promised goods or services is transferred to customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services.

 

The Company applies the following five steps in order to determine the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its agreements:

 

identify the contract with a customer;

identify the performance obligations in the contract;

determine the transaction price;

allocate the transaction price to performance obligations in the contract; and

recognize revenue as the performance obligation is satisfied.

 

The Company records the revenue from the sale of jewelry and healthcare supplement products during the period.

 

·

Cost of revenue

 

Cost of revenue consists primarily of the cost of goods sold, which are directly attributable to the sales of products.

 

 

·

Income taxes

 

The Company adopted the ASC 740 Income tax provisions of paragraph 740-10-25-13, which addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the condensed consolidated financial statements. Under paragraph 740-10-25-13, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the condensed consolidated financial statements from such a position should be measured based on the largest benefit that has a greater than fifty percent (50%) likelihood of being realized upon ultimate settlement. Paragraph 740-10-25-13 also provides guidance on de-recognition, classification, interest and penalties on income taxes, accounting in interim periods and requires increased disclosures. The Company had no material adjustments to its liabilities for unrecognized income tax benefits according to the provisions of paragraph 740-10-25-13.

 

The estimated future tax effects of temporary differences between the tax basis of assets and liabilities are reported in the accompanying balance sheets, as well as tax credit carry-backs and carry-forwards. The Company periodically reviews the recoverability of deferred tax assets recorded on its balance sheets and provides valuation allowances as management deems necessary.

 

·

Uncertain tax positions

 

The Company did not take any uncertain tax positions and had no adjustments to its income tax liabilities or benefits pursuant to the ASC 740 provisions of Section 740-10-25 for the three and nine months ended September 30, 2020 and 2019.

 

·

Foreign currencies translation

 

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 transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the condensed consolidated statement of operations.

 

The reporting currency of the Company is United States Dollar (“US$”) and the accompanying condensed consolidated financial statements have been expressed in US$. In addition, the Company is operating in Hong Kong and maintain its books and record in its local currency, Hong Kong Dollars (“HKD”), which is a functional currency as being the primary currency of the economic environment in which their operations are conducted. In general, for consolidation purposes, assets and liabilities of its subsidiary whose functional currency is not US$ are translated into US$, in accordance with ASC Topic 830-30, “ Translation of Financial Statement”, using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements of foreign subsidiary are recorded as a separate component of accumulated other comprehensive income within the statements of changes in stockholder’s equity.

 

Translation of amounts from HKD into US$ has been made at the following exchange rates for the period ended September 30, 2020 and 2019:

 

 

 

September

30, 2020

 

 

September

30, 2019

 

Period-end HKD:US$ exchange rate

 

 

0.12903

 

 

 

0.12740

 

Period average HKD:US$ exchange rate

 

 

0.12885

 

 

 

0.12746

 

         

·

Comprehensive income

 

ASC Topic 220, “Comprehensive Income”, establishes standards for reporting and display of comprehensive income, its components and accumulated balances. Comprehensive income as defined includes all changes in equity during a period from non-owner sources. Accumulated other comprehensive income, as presented in the accompanying condensed consolidated statements of changes in stockholders’ equity, consists of changes in unrealized gains and losses on foreign currency translation. This comprehensive income is not included in the computation of income tax expense or benefit.

            

·

Segment reporting

              

ASC Topic 280, “Segment Reporting” establishes standards for reporting information about operating segments on a basis consistent with the Company’s internal organization structure as well as information about geographical areas, business segments and major customers in condensed consolidated financial statements. For the period ended September 30, 2020 and 2019, the Company operates in one reportable operating segment in Hong Kong.

               

·

Related parties

       

The Company follows the ASC 850-10, Related Party for the identification of related parties and disclosure of related party transactions.

 

Pursuant to section 850-10-20 the related parties include a) affiliates of the Company; b) entities for which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of section 825–10–15, to be accounted for by the equity method by the investing entity; c) trusts for the benefit of employees, such as pension and Income-sharing trusts that are managed by or under the trusteeship of management; d) principal owners of the Company; e) management of the Company; f) other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests; and g) other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests.

 

The condensed consolidated financial statements shall include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business. However, disclosure of transactions that are eliminated in the preparation of consolidated or combined financial statements is not required in those statements. The disclosures shall include: a) the nature of the relationship(s) involved; b) a description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which income statements are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the financial statements; c) the dollar amounts of transactions for each of the periods for which income statements are presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and d) amount due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement.

 

·

Commitments and contingencies

 

The Company follows the ASC 450-20, Commitments to report accounting for contingencies. Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or un-asserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or un-asserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein.

 

If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s condensed consolidated financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed.

 

Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. Management does not believe, based upon information available at this time that these matters will have a material adverse effect on the Company’s financial position, results of operations or cash flows. However, there is no assurance that such matters will not materially and adversely affect the Company’s business, financial position, and results of operations or cash flows.

               

·

Fair value of financial instruments

 

The Company follows paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and has adopted paragraph 820-10-35-37 of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 of the FASB Accounting Standards Codification establishes a framework for measuring fair value in generally accepted accounting principles (GAAP), and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, paragraph 820-10-35-37 of the FASB Accounting Standards Codification establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by paragraph 820-10-35-37 of the FASB Accounting Standards Codification are described below:

 

Level 1

 

Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.

 

 

 

Level 2

 

Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.

 

 

 

Level 3

 

Pricing inputs that are generally observable inputs and not corroborated by market data.

 

Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable.

 

The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument.

 

The carrying amounts of the Company’s financial assets and liabilities, such as cash and cash equivalents, approximate their fair values because of the short maturity of these instruments.

 

·

Recent accounting pronouncements

 

In January 2017, the Financial Accounting Standard Board (“FASB”) issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350) : Simplifying the Accounting for Goodwill Impairment (“ASU 2017-04”). ASU 2017-04 removes Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation. A goodwill impairment will now be the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. This standard, which will be effective for the Company beginning in the first quarter of fiscal year 2020, is required to be applied prospectively. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company is currently evaluating the impact this standard will have on its condensed consolidated financial statements.

 

In June 2018, the FASB issued ASU 2018-07, Improvements to Nonemployee Share-Based Payment Accounting (“ASU 2018-07”), which supersedes ASC 505-50 and expands the scope of ASC 718 to include all share-based payments arrangements related to the acquisition of goods and services from both employees and nonemployees. For public companies, the amendments are effective for annual reporting periods beginning after December 15, 2018, including interim periods within those annual periods. Early adoption is permitted, but no earlier than a company’s adoption date of ASC 606. The Company does not believe that the adoption of ASU 2018-07 will have a material impact on the Company’s condensed consolidated financial statements.

 

In August 2018, the FASB issued ASU No. 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract, which amended its guidance for costs of implementing a cloud computing service arrangement to align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. This new standard also requires customers to expense the capitalized implementation costs of a hosting arrangement that is a service contract over the term of the hosting arrangement. This new standard becomes effective for the Company in the first quarter of fiscal year 2020, with early adoption permitted. This new standard can be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. The Company is evaluating the impact of adopting this amendment to its condensed consolidated financial statements.

 

The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and do not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations.

 

XML 19 R9.htm IDEA: XBRL DOCUMENT v3.20.2
STOCKHOLDERS EQUITY
9 Months Ended
Sep. 30, 2020
STOCKHOLDERS EQUITY  
NOTE 3 - STOCKHOLDERS' EQUITY

Authorized shares

             

As of September 30, 2020 and December 31, 2019, the Company’s authorized shares were 5,000,000 shares of preferred stock, with a par value of $0.001.

         

As of September 30, 2020 and December 31, 2019, the Company’s authorized shares were 2,000,000,000 and 499,000,000 shares of common stock, with a par value of $0.001, respectively.

           

  Issued and outstanding shares

        

As of September 30, 2020 and December 31, 2019, the Company had 1,000,000 shares of Series A preferred stock issued and outstanding.

    

On March 6, 2020, the Company approved by the state government of Wyoming and effectuated a 1 for 10,000 reverse stock split. The number of authorized shares remains unchanged. All share and per share information in this financial statements and footnotes have been retroactively adjusted for all periods presented, unless otherwise indicated, to give effect to the reverse stock split.

 

On March 20, 2020, the Company consummated the Share Exchange Transaction among Gold Shiny International Limited (“GSIL”) and its shareholders and issued 10,000,000 shares of common stock in exchange for 100% equity interest of GSIL. Upon completion of the Share Exchange Transaction, GSIL became a 100% owned subsidiary of the Company.

            

As of September 30, 2020 and December 31, 2019, the Company had 10,161,039 and 10,161,039 shares of common stock issued and outstanding, respectively.

 

XML 20 R10.htm IDEA: XBRL DOCUMENT v3.20.2
INCOME TAXES
9 Months Ended
Sep. 30, 2020
INCOME TAXES  
NOTE 4 - INCOME TAXES

The provision for income taxes consisted of the following:

                

 

 

Nine months ended September 30,

 

 

 

2020

 

 

2019

 

 

 

 

 

 

 

 

Current tax

 

$

25,129

 

 

$

-

 

Deferred tax

 

 

(3,455

)

 

 

6,204

 

 

 

 

 

 

 

 

 

 

Income tax expense

 

$

21,674

 

 

$

6,204

 

             

The effective tax rate in the periods presented is the result of the mix of income earned in various tax jurisdictions that apply a broad range of income tax rate. The Company mainly operates in Hong Kong that is subject to taxes in the jurisdictions in which they operate, as follows:

    

United States of America

       

FJHL is registered in the State of Wyoming and is subject to the tax laws of United States of America.

    

For the nine months ended September 30, 2020 and 2019, there was no operation in the United States of America.

          

BVI

       

Under the current BVI law, the Company is not subject to tax on income.

          

Hong Kong

      

The Company’s subsidiary operating in Hong Kong is subject to the Hong Kong Profits Tax at the two-tiered profits tax rates from 8.25% to 16.5% on the estimated assessable profits arising in Hong Kong during the current year, after deducting a tax concession for the tax year. The reconciliation of income tax rate to the effective income tax rate for the nine months ended September 30, 2020 and 2019 is as follows:

          

 

 

Nine months ended September 30,

 

 

 

2020

 

 

2019

 

 

 

 

 

 

 

 

Income before income taxes

 

$

306,179

 

 

$

45,629

 

Statutory income tax rate

 

 

16.5

%

 

 

16.5

%

Income tax expense at statutory rate

 

 

50,519

 

 

 

7,529

 

Tax effect of non-deductible items

 

 

956

 

 

 

105

 

Tax effect of tax holiday

 

 

(26,346

)

 

 

(7,634

)

Income tax expense

 

$

25,129

 

 

$

-

 

              

The following table sets forth the significant components of the deferred tax liabilities of the Company as of September 30, 2020 and December 31, 2019:

     

 

 

As of

 

 

 

September 30,

 

 

December 31,

 

 

 

2020

 

 

2019

 

 

 

 

 

 

 

 

Deferred tax liabilities:

 

 

 

 

 

 

Accelerated depreciation

 

$

(3,455

)

 

$

5,933

 

 

XML 21 R11.htm IDEA: XBRL DOCUMENT v3.20.2
RELATED PARTY TRANSACTIONS
9 Months Ended
Sep. 30, 2020
RELATED PARTY TRANSACTIONS  
NOTE 5 - RELATED PARTY TRANSACTIONS

Apart from the transactions and balances detailed elsewhere in these accompanying condensed consolidated financial statements, the Company has no other significant or material related party transactions during the periods presented.

XML 22 R12.htm IDEA: XBRL DOCUMENT v3.20.2
CONCENTRATIONS OF RISK
9 Months Ended
Sep. 30, 2020
CONCENTRATIONS OF RISK  
NOTE 6 - CONCENTRATIONS OF RISK

The Company is exposed to the following concentrations of risk:

   

(a) Major customers

 

For the three and nine months ended September 30, 2020,there was one single customer exceeding 10% of the Company’s revenue.

 

For the three and nine months ended September 30, 2019,there was no single customer exceeding 10% of the Company’s revenue.

 

All of the Company’s customers are located in Hong Kong.

 

(b) Major vendor

 

For the nine months ended September 30, 2020, two venders represented more than 10% of the Company’s operating cost. These vendors accounted for 85% and 15%, respectively, of the Company’s operating cost with no accounts payable at September 30, 2020.

 

For the three months ended September 30, 2020, there was one vender represented more than 10% of the Company’s operating cost. This vendor accounted for 100% of the Company’s operating cost with no accounts payable at September 30, 2020.

 

For the three and nine months ended September 30, 2019, there was one single vendor represented more than 10% of the Company’s operating cost.

 

The Company’s vendor is located in Hong Kong.

 

(c) Economic and political risk

  

The Company’s major operations are conducted in Hong Kong. Accordingly, the political, economic, and legal environments in Hong Kong, as well as the general state of Hong Kong’s economy may influence the Company’s business, financial condition, and results of operations.

 

(d) Exchange rate risk

            

The Company cannot guarantee that the current exchange rate will remain steady; therefore there is a possibility that the Company could post the same amount of profit for two comparable periods and because of the fluctuating exchange rate actually post higher or lower profit depending on exchange rate of HKD converted to US$ on that date. The exchange rate could fluctuate depending on changes in political and economic environments without notice.

XML 23 R13.htm IDEA: XBRL DOCUMENT v3.20.2
COMMITEMENT AND CONTIGENCIES
9 Months Ended
Sep. 30, 2020
COMMITEMENT AND CONTIGENCIES  
NOTE 7 - COMMITMENTS AND CONTIGENCIES

As of September 30, 2020, the Company has no material commitments or contingencies.

XML 24 R14.htm IDEA: XBRL DOCUMENT v3.20.2
SUBSEQUENT EVENTS
9 Months Ended
Sep. 30, 2020
SUBSEQUENT EVENTS  
NOTE 8 - SUBSEQUENT EVENTS

In accordance with ASC Topic 855, “Subsequent Events”, which establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before condensed consolidated financial statements are issued, the Company has evaluated all events or transactions that occurred after September 30, 2020, up through the date the Company issued the unaudited condensed consolidated financial statements.

XML 25 R15.htm IDEA: XBRL DOCUMENT v3.20.2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)
9 Months Ended
Sep. 30, 2020
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES  
Basis of Presentation

These accompanying condensed consolidated financial statements have been prepared in U.S. Dollars in conformity with generally accepted accounting principles in the United States of America (“U.S. GAAP”) for interim financial information pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary to make the financial statements not misleading have been included. Operating results for the interim period ended September 30, 2020 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2020. The information included in this Form 10-Q should be read in conjunction with Management’s Discussion and Analysis, and the financial statements and notes thereto included in the Company’s Form 10/A for the fiscal year ended December 31, 2019, filed with the SEC on May 1, 2020.

Use of estimates and assumptions

In preparing these condensed consolidated financial statements, management makes estimates and assumptions that affect the reported amounts of assets and liabilities in the balance sheet and revenues and expenses during the periods reported. Actual results may differ from these estimates.

Basis of consolidation

The condensed consolidated financial statements include the accounts of FJHL and its subsidiaries. All significant inter-company balances and transactions within the Company have been eliminated upon consolidation.

Cash and Cash Equivalents

Cash and cash equivalents are carried at cost and represent cash on hand, demand deposits placed with banks or other financial institutions and all highly liquid investments with an original maturity of three months or less as of the purchase date of such investments.

Accounts receivable

Accounts receivable are recorded at the invoiced amount and do not bear interest, which are due within contractual payment terms, generally 30 to 90 days from completion of service. Credit is extended based on evaluation of a customer’s financial condition, the customer credit-worthiness and their payment history. Accounts receivable outstanding longer than the contractual payment terms are considered past due. Past due balances over 90 days and over a specified amount are reviewed individually for collectibility. At the end of fiscal year, the Company specifically evaluates individual customer’s financial condition, credit history, and the current economic conditions to monitor the progress of the collection of accounts receivables. The Company will consider the allowance for doubtful accounts for any estimated losses resulting from the inability of its customers to make required payments. For the receivables that are past due or not being paid according to payment terms, the appropriate actions are taken to exhaust all means of collection, including seeking legal resolution in a court of law. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company does not have any off-balance-sheet credit exposure related to its customers. As of September 30, 2020, there was no allowance for doubtful accounts.

Plant and equipment

Plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses, if any. Depreciation is calculated on the straight-line basis over the following expected useful lives from the date on which they become fully operational and after taking into account their estimated residual values:

 

 

 

Expected useful lives

 

Computer equipment

 

5 years

 

 

Expenditures for repairs and maintenance are expensed as incurred. When assets have been retired or sold, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in the results of operations.

 

Depreciation expense for the three months ended September 30, 2020 and 2019 were $1,932 and $637, respectively.

 

Depreciation expense for the nine months ended September 30, 2020 and 2019 were $5,798 and $637, respectively.

 

Revenue recognition

The Company adopted Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”) using the full retrospective transition method. The Company’s adoption of ASU 2014-09 did not have a material impact on the amount and timing of revenue recognized in its condensed consolidated financial statements.

 

Under ASU 2014-09, the Company recognizes revenue when control of the promised goods or services is transferred to customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services.

 

The Company applies the following five steps in order to determine the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its agreements:

 

identify the contract with a customer;

identify the performance obligations in the contract;

determine the transaction price;

allocate the transaction price to performance obligations in the contract; and

recognize revenue as the performance obligation is satisfied.

       

The Company records the revenue from the sale of jewelry and healthcare supplement products during the period.

Cost of revenue

Cost of revenue consists primarily of the cost of goods sold, which are directly attributable to the sales of products.

Income Taxes

The Company adopted the ASC 740 Income tax provisions of paragraph 740-10-25-13, which addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the condensed consolidated financial statements. Under paragraph 740-10-25-13, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the condensed consolidated financial statements from such a position should be measured based on the largest benefit that has a greater than fifty percent (50%) likelihood of being realized upon ultimate settlement. Paragraph 740-10-25-13 also provides guidance on de-recognition, classification, interest and penalties on income taxes, accounting in interim periods and requires increased disclosures. The Company had no material adjustments to its liabilities for unrecognized income tax benefits according to the provisions of paragraph 740-10-25-13.

 

The estimated future tax effects of temporary differences between the tax basis of assets and liabilities are reported in the accompanying balance sheets, as well as tax credit carry-backs and carry-forwards. The Company periodically reviews the recoverability of deferred tax assets recorded on its balance sheets and provides valuation allowances as management deems necessary.

Uncertain tax positions

The Company did not take any uncertain tax positions and had no adjustments to its income tax liabilities or benefits pursuant to the ASC 740 provisions of Section 740-10-25 for the three and nine months ended September 30, 2020 and 2019.

Foreign currencies translation

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 transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the condensed consolidated statement of operations.

                 

The reporting currency of the Company is United States Dollar (“US$”) and the accompanying condensed consolidated financial statements have been expressed in US$. In addition, the Company is operating in Hong Kong and maintain its books and record in its local currency, Hong Kong Dollars (“HKD”), which is a functional currency as being the primary currency of the economic environment in which their operations are conducted. In general, for consolidation purposes, assets and liabilities of its subsidiary whose functional currency is not US$ are translated into US$, in accordance with ASC Topic 830-30, “ Translation of Financial Statement”, using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements of foreign subsidiary are recorded as a separate component of accumulated other comprehensive income within the statements of changes in stockholder’s equity.

                 

Translation of amounts from HKD into US$ has been made at the following exchange rates for the period ended September 30, 2020 and 2019:

              

 

 

September

30, 2020

 

 

September

30, 2019

 

Period-end HKD:US$ exchange rate

 

 

0.12903

 

 

 

0.12740

 

Period average HKD:US$ exchange rate

 

 

0.12885

 

 

 

0.12746

 

Comprehensive income

ASC Topic 220, “Comprehensive Income”, establishes standards for reporting and display of comprehensive income, its components and accumulated balances. Comprehensive income as defined includes all changes in equity during a period from non-owner sources. Accumulated other comprehensive income, as presented in the accompanying condensed consolidated statements of changes in stockholders’ equity, consists of changes in unrealized gains and losses on foreign currency translation. This comprehensive income is not included in the computation of income tax expense or benefit.

Segment reporting

ASC Topic 280, “Segment Reporting” establishes standards for reporting information about operating segments on a basis consistent with the Company’s internal organization structure as well as information about geographical areas, business segments and major customers in condensed consolidated financial statements. For the period ended September 30, 2020 and 2019, the Company operates in one reportable operating segment in Hong Kong.

Related parties

The Company follows the ASC 850-10, Related Party for the identification of related parties and disclosure of related party transactions.

 

Pursuant to section 850-10-20 the related parties include a) affiliates of the Company; b) entities for which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of section 825–10–15, to be accounted for by the equity method by the investing entity; c) trusts for the benefit of employees, such as pension and Income-sharing trusts that are managed by or under the trusteeship of management; d) principal owners of the Company; e) management of the Company; f) other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests; and g) other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests.

 

The condensed consolidated financial statements shall include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business. However, disclosure of transactions that are eliminated in the preparation of consolidated or combined financial statements is not required in those statements. The disclosures shall include: a) the nature of the relationship(s) involved; b) a description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which income statements are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the financial statements; c) the dollar amounts of transactions for each of the periods for which income statements are presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and d) amount due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement.

Commitments and contingencies

The Company follows the ASC 450-20, Commitments to report accounting for contingencies. Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or un-asserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or un-asserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein.

 

If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s condensed consolidated financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed.

 

Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. Management does not believe, based upon information available at this time that these matters will have a material adverse effect on the Company’s financial position, results of operations or cash flows. However, there is no assurance that such matters will not materially and adversely affect the Company’s business, financial position, and results of operations or cash flows.

Fair value of financial instruments

The Company follows paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and has adopted paragraph 820-10-35-37 of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 of the FASB Accounting Standards Codification establishes a framework for measuring fair value in generally accepted accounting principles (GAAP), and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, paragraph 820-10-35-37 of the FASB Accounting Standards Codification establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by paragraph 820-10-35-37 of the FASB Accounting Standards Codification are described below:

 

Level 1

 

Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.

 

 

 

Level 2

 

Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.

 

 

 

Level 3

 

Pricing inputs that are generally observable inputs and not corroborated by market data.

 

Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable.

 

The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument.

 

The carrying amounts of the Company’s financial assets and liabilities, such as cash and cash equivalents, approximate their fair values because of the short maturity of these instruments.

Recent accounting pronouncements

In January 2017, the Financial Accounting Standard Board (“FASB”) issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350) : Simplifying the Accounting for Goodwill Impairment (“ASU 2017-04”). ASU 2017-04 removes Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation. A goodwill impairment will now be the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. This standard, which will be effective for the Company beginning in the first quarter of fiscal year 2020, is required to be applied prospectively. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company is currently evaluating the impact this standard will have on its condensed consolidated financial statements.

 

In June 2018, the FASB issued ASU 2018-07, Improvements to Nonemployee Share-Based Payment Accounting (“ASU 2018-07”), which supersedes ASC 505-50 and expands the scope of ASC 718 to include all share-based payments arrangements related to the acquisition of goods and services from both employees and nonemployees. For public companies, the amendments are effective for annual reporting periods beginning after December 15, 2018, including interim periods within those annual periods. Early adoption is permitted, but no earlier than a company’s adoption date of ASC 606. The Company does not believe that the adoption of ASU 2018-07 will have a material impact on the Company’s condensed consolidated financial statements.

  

In August 2018, the FASB issued ASU No. 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract, which amended its guidance for costs of implementing a cloud computing service arrangement to align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. This new standard also requires customers to expense the capitalized implementation costs of a hosting arrangement that is a service contract over the term of the hosting arrangement. This new standard becomes effective for the Company in the first quarter of fiscal year 2020, with early adoption permitted. This new standard can be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. The Company is evaluating the impact of adopting this amendment to its condensed consolidated financial statements.

 

The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and do not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations.

XML 26 R16.htm IDEA: XBRL DOCUMENT v3.20.2
DESCRIPTION OF BUSINESS ORGANIZATION (Tables)
9 Months Ended
Sep. 30, 2020
DESCRIPTION OF BUSINESS AND ORGANIZATION  
Summary of descriptions of subsidiaries

Name

 

Place of incorporation

and kind of

legal entity

 

Principal activities

and place of operation

 

Particulars of registered/ paid up share

capital

 

Effective interest

held

 

 

 

 

 

 

 

 

 

Fovea International Holdings Limited

 

British Virgin Islands

 

Investment holding

 

100 ordinary shares at par value of US$1

 

100%

 

 

 

 

 

 

 

 

 

Fovea Jewellery Holdings Limited

 

Hong Kong

 

Sales and marketing in Hong Kong

 

1 ordinary share for HK$1

 

100%

 

 

 

 

 

 

 

 

 

Gold Shiny International Limited

 

British Virgin Islands

 

Investment holding

 

115 ordinary shares at par value of US$1

 

100%

 

 

 

 

 

 

 

 

 

Gold Shiny (Asia) Limited

 

Hong Kong

 

Sales and marketing in Hong Kong

 

1 ordinary share for HK$1

 

100%

XML 27 R17.htm IDEA: XBRL DOCUMENT v3.20.2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)
9 Months Ended
Sep. 30, 2020
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES  
Summary of plant and equipment

 

 

Expected useful lives

 

Computer equipment

 

5 years

 

Summary of exchange rates

 

 

September

30, 2020

 

 

September

30, 2019

 

Period-end HKD:US$ exchange rate

 

 

0.12903

 

 

 

0.12740

 

Period average HKD:US$ exchange rate

 

 

0.12885

 

 

 

0.12746

 

XML 28 R18.htm IDEA: XBRL DOCUMENT v3.20.2
INCOME TAXES (Tables)
9 Months Ended
Sep. 30, 2020
INCOME TAXES  
Schedule of provision for income tax

 

 

Nine months ended September 30,

 

 

 

2020

 

 

2019

 

 

 

 

 

 

 

 

Current tax

 

$ 25,129

 

 

$ -

 

Deferred tax

 

 

(3,455 )

 

 

6,204

 

 

 

 

 

 

 

 

 

 

Income tax expense

 

$ 21,674

 

 

$ 6,204

 

Schedule of income tax rate

 

 

Nine months ended September 30,

 

 

 

2020

 

 

2019

 

 

 

 

 

 

 

 

Income before income taxes

 

$ 306,179

 

 

$ 45,629

 

Statutory income tax rate

 

 

16.5 %

 

 

16.5 %

Income tax expense at statutory rate

 

 

50,519

 

 

 

7,529

 

Tax effect of non-deductible items

 

 

956

 

 

 

105

 

Tax effect of tax holiday

 

 

(26,346 )

 

 

(7,634 )

Income tax expense

 

$ 25,129

 

 

$ -

 

Schedule of Deferred Tax Liabilities

 

 

As of

 

 

 

September 30,

 

 

December 31,

 

 

 

2020

 

 

2019

 

 

 

 

 

 

 

 

Deferred tax liabilities:

 

 

 

 

 

 

Accelerated depreciation

 

$ (3,455 )

 

$ 5,933

 

XML 29 R19.htm IDEA: XBRL DOCUMENT v3.20.2
DESCRIPTION OF BUSINESS AND ORGANIZATION (Details)
9 Months Ended
Sep. 30, 2020
Fovea International Holdings Limited [Member]  
Place of incorporation and kind of legal entity British Virgin Islands
Principal activities and place of operation Investment holding
Particulars of registered/ paid up share capital 100 ordinary shares at par value of US$1
Effective interest held 100.00%
Fovea Jewellery Holdings Limited [Member]  
Place of incorporation and kind of legal entity Hong Kong
Principal activities and place of operation Sales and marketing in Hong Kong
Particulars of registered/ paid up share capital 1 ordinary share for HK$1
Effective interest held 100.00%
Gold Shiny International Limited [Member]  
Place of incorporation and kind of legal entity British Virgin Islands
Principal activities and place of operation Investment holding
Particulars of registered/ paid up share capital 115 ordinary shares at par value of US$1
Effective interest held 100.00%
Gold Shiny (Asia) Limited [Member]  
Place of incorporation and kind of legal entity Hong Kong
Principal activities and place of operation Sales and marketing in Hong Kong
Particulars of registered/ paid up share capital 1 ordinary share for HK$1
Effective interest held 100.00%
XML 30 R20.htm IDEA: XBRL DOCUMENT v3.20.2
DESCRIPTION OF BUSINESS AND ORGANIZATION (Details Narrative) - shares
1 Months Ended
Mar. 20, 2020
Mar. 06, 2020
Sep. 30, 2020
Dec. 31, 2019
Reverse stock split description   1 for 10,000    
Common stock, shares issued     10,161,039 10,161,039
Common stock shares outstanding     10,161,039 10,161,039
Gold Shiny International Limited [Member]        
Common stock, shares issued 10,000,000      
Ownership subsidiary 100.00%      
Common stock shares outstanding 10,000,000      
XML 31 R21.htm IDEA: XBRL DOCUMENT v3.20.2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details)
9 Months Ended
Sep. 30, 2020
Computer Equipment [Member]  
Expected useful lives 5 years
XML 32 R22.htm IDEA: XBRL DOCUMENT v3.20.2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 1)
Sep. 30, 2020
Sep. 30, 2019
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES    
Period-end HKD:US$ exchange rate 0.12903 0.12740
Period average HKD:US$ exchange rate 0.12885 0.12746
XML 33 R23.htm IDEA: XBRL DOCUMENT v3.20.2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($)
3 Months Ended 9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
Sep. 30, 2020
Sep. 30, 2019
Computer Equipment [Member]        
Depreciation expense $ 1,932 $ 637 $ 5,798 $ 637
XML 34 R24.htm IDEA: XBRL DOCUMENT v3.20.2
STOCKHOLDERS' EQUITY (Details Narrative) - $ / shares
1 Months Ended
Mar. 20, 2020
Mar. 06, 2020
Sep. 30, 2020
Dec. 31, 2019
Preferred stock, shares par value     $ 0.001 $ 0.001
Common stock, shares authorized     2,000,000,000 2,000,000,000
Reverse stock split description   1 for 10,000    
Common stock, shares par value     $ 0.001 $ 0.001
Common stock, shares outstanding     10,161,039 10,161,039
Common stock, shares issued     10,161,039 10,161,039
Preferred stock, shares authorized     5,000,000 5,000,000
Preferred stock, shares issued     0 0
Preferred stock, shares outstanding     0 0
Gold Shiny International Limited [Member]        
Common stock, shares outstanding 10,000,000      
Common stock, shares issued 10,000,000      
Equity interest 100.00%      
Ownership subsidiary 100.00%      
Stockholders Equity [Member]        
Preferred stock, shares par value     $ 0.001 $ 0.001
Common stock, shares authorized     2,000,000,000 499,000,000
Reverse stock split description   1 for 10,000    
Common stock, shares par value     $ 0.001 $ 0.001
Common stock, shares outstanding     10,161,039 10,161,039
Common stock, shares issued     10,161,039 10,161,039
Preferred stock, shares authorized     5,000,000 5,000,000
Preferred Stock Series A [Member]        
Preferred stock, shares par value     $ 0.001 $ 0.001
Preferred stock, shares authorized     1,000,000 1,000,000
Preferred stock, shares issued     1,000,000 1,000,000
Preferred stock, shares outstanding     1,000,000 1,000,000
XML 35 R25.htm IDEA: XBRL DOCUMENT v3.20.2
INCOME TAX (Details) - USD ($)
Sep. 30, 2020
Sep. 30, 2019
INCOME TAXES    
Current tax $ 25,129 $ 0
Deferred Tax (3,455) 6,204
Income tax expense $ 21,674 $ 6,204
XML 36 R26.htm IDEA: XBRL DOCUMENT v3.20.2
INCOME TAX (Details 1) - USD ($)
9 Months Ended
Sep. 30, 2020
Sep. 30, 2019
INCOME TAXES    
Income before income taxes $ 306,179 $ 45,629
Statutory Income Tax Rate 16.50% 16.50%
Income tax expense at statutory rate $ 50,519 $ 7,529
Tax effect of non-deductible items 956 105
Tax effect of tax holiday (26,346) (7,634)
Income tax expenses $ 25,129 $ 0
XML 37 R27.htm IDEA: XBRL DOCUMENT v3.20.2
INCOME TAX (Details 2) - USD ($)
9 Months Ended 12 Months Ended
Sep. 30, 2020
Dec. 31, 2019
Deferred tax liabilities:    
Accelerated depreciation $ (3,455) $ 5,933
XML 38 R28.htm IDEA: XBRL DOCUMENT v3.20.2
INCOME TAX (Details Narrative) - Hong Kong [Member]
9 Months Ended
Sep. 30, 2019
Minimum [Member]  
Profits tax rates 8.25%
Maximum [Member]  
Profits tax rates 16.50%
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CONCENTRATIONS OF RISK (Details Narrative)
3 Months Ended 9 Months Ended
Sep. 30, 2020
Sep. 30, 2020
Two Vendors [Member]    
Concentration risk 85.00% 15.00%
One Vendors [Member]    
Concentration risk 100.00%  
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