INTANGIBLE ASSETS

6 Months Ended

Dec. 31, 2011

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets Disclosure [Text Block]

NOTE 8 - INTANGIBLE ASSETS

Intangible assets consisted of the following:

	December 31,		June 30,
	2011		2011
Land use rights, net	$	11,196,056	$	11,814,149
Technology patent, net		2,009,518		1,188,969
Customer relationships, net		8,690,825		9,045,858
Non-compete agreement		145,345		163,363
Trademarks		6,279,188		6,296,290
Total	$	28,320,932	$	28,508,629

Land Use Rights

On September 25, 2009, Yuxing was granted a land use right for approximately 88 acres (353,000 square meters or 3.8 million square feet) by the People’s Government and Land & Resources Bureau of Hu County, Xi’an, Shaanxi Province. The fair value of the related intangible asset was determined to be the respective cost of RMB 73,184,895 (or $11,511,984). The intangible asset is being amortized over the grant period of 50 years.

On August 13, 2003, Tianjuyuan was granted a certificate of Land Use Right for a parcel of land of approximately 11 acres (42,726 square meters or 459,898 square feet) at Ping Gu District, Beijing. The purchase cost was recorded at RMB1,045,950 (or $164,528). The intangible asset is being amortized over the grant period of 50 years.

On August 16, 2001, Jinong received a land use right as contribution from a shareholder, which was granted by the People’s Government and Land & Resources Bureau of Yangling District, Shaanxi Province. The fair value of the related intangible asset at the time of the contribution was determined to be RMB7,285,099 (or $1,145,946). The intangible asset is being amortized over the grant period of 50 years.

The land use rights consisted of the following:

	December 31,			June 30,
	2011			2011
Land use rights	$	12,822,458		$	12,452,801
Less: accumulated amortization		(1,626,402	)		(638,652	)
Total land use rights, net	$	11,196,056		$	11,814,149

Technology Patent

On August 16, 2001, Jinong was issued a technology patent related to a proprietary formula used in the production of humid acid. The fair value of the related intangible asset was determined to be the respective cost of $924,148 (or RMB5, 875,068). The intangible asset is being amortized over the patent period of 10 years. On November 24, 2010, Jinong renewed this technology patent for another 10 year term.

On July 2, 2010, the Company acquired Gufeng and its wholly-owned subsidiary Tianjuyuan. The fair value on the acquired technology patent was determined to be RMB 9,200,000 (or $1,447,160) and is being amortized over the remaining useful life of six years.

The technology know-how consisted of the following:

	December 31,			June 30,
	2011			2011
Technology know-how	$	2,371,308		$	2,332,113
Less: accumulated amortization		(361,790	)		(1,143,144	)
Total technology know-how, net	$	2,009,518		$	1,188,969

Customer Relationship

On July 2, 2010, the Company acquired Gufeng and its wholly-owned subsidiary Tianjuyuan. The preliminary fair value on the acquired customer relationships was estimated to be RMB55,992,980 (or $10,224,500) and is amortized over the remaining useful life of ten years.

	December 31,			June 30,
	2011			2011
Customer relationships	$	10,224,500		$	10,096,418
Less: accumulated amortization		(1,533,675	)		(1,050,560	)
Total customer relationships, net	$	8,690,825		$	9,045,858

Non-Compete Agreement

On July 2, 2010, the Company acquired Gufeng and its wholly-owned subsidiary Tianjuyuan. The preliminary fair value on the acquired non-compete agreement was estimated to be RMB1,320,000 (or $207,636) and is amortized over the remaining useful life of five years using the straight line method.

	December 31,			June 30,
	2011			2011
Non-compete agreement	$	207,636		$	204,204
Less: accumulated amortization		(62,291	)		(40,841	)
Total non-compete agreement, net	$	145,345		$	163,363

Trademarks

On July 2, 2010, the Company acquired Gufeng and its wholly-owned subsidiary Tianjuyuan. The preliminary fair value on the acquired trademarks was estimated to be $6,279,188 and is subject to an annual impairment test.

Total amortization expenses of intangible assets for the three months ended December 31, 2011 and 2010 amounted to $331,940 and $399,810, respectively. Total amortization expenses of intangible assets for the six months ended December 31, 2011 and 2010 amounted to $663,442 and $480,953, respectively.

Amortization Expense

Estimated amortization expenses of intangible assets for the next five (5) twelve-month periods ended December 31, are as follows:

December 31, 2012	$	1,654,035
December 31, 2013		1,654,035
December 31, 2014		1,654,035
December 31, 2015		1,654,035
December 31, 2016		1,654,035