Variable Interest Entities

9 Months Ended

Mar. 31, 2020

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 sufficient 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 a majority 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 also 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, 2020 and June 30, 2019:

	March 31,		June 30,
	2020		2019
ASSETS
Current Assets
Cash and cash equivalents	$	1,122,822	$	818,312
Accounts receivable, net		35,209,724		29,933,837
Inventories		26,070,040		19,944,011
Other current assets		625,112		475,001
Related party receivable		0		(1,031	)
Advances to suppliers		576,795		3,606,384
Total Current Assets		63,604,493		54,776,514
Plant, Property and Equipment, Net		8,738,807		9,753,039
Other assets		59,406		218,549
Intangible Assets, Net		9,527,049		10,212,668
Goodwill		3,109,606		3,208,779
Total Assets	$	85,039,361	$	78,169,549
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable		18,770,058		17,250,276
Customer deposits		588,733		256,489
Accrued expenses and other payables		7,692,853		6,243,753
Amount due to related parties		42,045,369		42,680,723
Total Current Liabilities	$	69,097,013	$	66,431,241
Long-term Loan		-		-
Total Liabilities	$	69,097,013	$	66,431,241
Stockholders' equity		15,942,348		11,738,308
Total Liabilities and Stockholders' Equity		85,039,361	$	78,169,549

	Three Months Ended March 31,
	2020		2019
Revenue	$	17,465,942	$	18,875,808
Expenses		17,372,472		16,638,610
Net income	$	93,470	$	2,237,198

	Nine Months Ended March 31,
	2020		2019
Revenue	$	45,686,455	$	49,772,242
Expenses		41,073,778		45,582,052
Net income	$	4,612,677	$	4,190,190