Variable Interest Entities

9 Months Ended

Mar. 31, 2019

Variable Interest Entities [Abstract]

VARIABLE INTEREST ENTITIES

NOTE 16 – VARIABLE INTEREST ENTITIES

In accordance with accounting standards regarding consolidation of variable interest entities, VIEs are generally entities that lack enough equity to finance their activities without additional financial support from other parties or whose equity holders lack adequate decision-making ability. All VIEs with which a company is involved must be evaluated to determine the primary beneficiary of the risks and rewards of the VIE. The primary beneficiary is required to consolidate the VIE for financial reporting purposes.

Green Nevada through one of its subsidiaries, Jinong, entered into a series of agreements (the "VIE Agreements") with Yuxing for it to qualify as a VIE, effective June 16, 2013.

The Company has concluded, based on the contractual arrangements, that Yuxing is a VIE and that the Company's wholly-owned subsidiary, Jinong, absorbs most of the risk of loss from the activities of Yuxing, thereby enabling the Company, through Jinong, to receive a majority of Yuxing expected residual returns.

On June 30, 2016 and January 1, 2017, the Company, through its wholly-owned subsidiary Jinong, entered into strategic acquisition agreements and into a series of contractual agreements to qualify as VIEs with the shareholders of the sales VIE Companies.

Jinong, the sales VIE Companies, and the shareholders of the sales VIE Companies also entered into a series of contractual agreements for the sales VIE Companies to qualify as VIEs (the "VIE Agreements").

On November 30, 2017, the Company, through its wholly-owned subsidiary Jinong, exited the VIE agreements with the shareholders of Zhenbai.

As a result of these contractual arrangements, with Yuxing and the sales VIE Companies the Company is entitled to substantially all of the economic benefits of Yuxing and the VIE Companies. The following financial statement amounts and balances of the VIEs were included in the accompanying consolidated financial statements as of March 31, 2019 and June 30, 2018:

	March 31,		June 30,
	2019		2018
ASSETS
Current Assets
Cash and cash equivalents	$	970,474	$	982,312
Accounts receivable, net		22,545,084		38,295,505
Inventories		23,002,341		21,133,970
Other current assets		648,132		988,051
Related party receivable		0		(359,005
Advances to suppliers		4,848,280		848,458
Total Current Assets		52,014,311		61,889,291
Plant, Property and Equipment, Net		10,271,628		11,206,667
Other assets		223,652		226,654
Intangible Assets, Net		10,641,139		11,348,180
Goodwill		3,283,709		3,319,732
Total Assets	$	76,434,439	$	87,990,524
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Short-term loan	$	-	$	-
Accounts payable		7,833,312		25,584,614
Customer deposits		1,021,889		841,694
Accrued expenses and other payables		5,297,819		3,896,340
Amount due to related parties		43,257,584		43,339,286
Total Current Liabilities	$	57,410,604	$	73,661,934
Total Liabilities	$	57,410,604	$	73,661,934
Stockholders' equity		19,023,835		14,328,590
Total Liabilities and Stockholders' Equity		76,434,439	$	87,990,524

	Three months ended Three Months Ended March 31,				Nine months ended Nine Months Ended March 31,
	2019		2018		2019		2018
Revenue	$	18,875,808	$	16,127,953	$	49,772,242	$	47,205,271
Expenses		16,638,610		13,749,981		45,582,052		39,340,523
Net income (loss)	$	2,237,198	$	940,622	$	4,190,190	$	1,140,302