Notes to the
Unaudited
Condensed
Consolidated Interim
Financial Statements
June 30
, 201
4
NOTE 1
–
ORGANIZATION AND DESCRIPTION OF BUSINESS
Yinfu Gold Corporation
(the "Company") is a
Wyoming
corporation incorporated on
September
1
,
20
05
under the name Ace Lock and Security
,
Inc. and established a fiscal year at the end of March 31. Yinfu Gold
Corporation (formerly known as "Element92 Resources Corp.") was originally incorporated under the laws of the
State of Wyoming as Ace Lock & Security
, Inc
. On March 5, 2007, we filed a Certificate of Amendment with the
Wyoming Secretary of State to change our name to
Element92 Resources Corp.
and increased our authorized capital to
1,000,000,000 common shares. On November 18, 2010, the Company received a notification from the Financial
Industry Regulatory Authority ("FINRA") that the Company's change of name from Element92 Resources Corp
. t
o
Yinfu Gold Corporation
was
posted as effective with FINRA. The Company was established as an
exploration stage company engaged in the search for commercially viable minerals.
We no longer pursue opportunities related to
the exploration of minerals. O
ur name change to
Yinfu Gold
Corporation
, as filed with
the
State of Wyoming
o
n November 18, 2010,
signified that we have commenced working toward a major change in our business plan and business model.
Effective November 20, 2014, the Company executed a Sale and Purchase Agreement (the "Agreement") to acquire 100% of the shares and assets of China Enterprise Overseas Investment & Finance Group Limited, a British Virgin Island
s
corporation ("CE
I
"). Pursuant to the Agreement,
the Company
has agreed to issue 800 million restricted common shares of the C
ompany
to
the owners of CE
I
.
Dahua Online Shopping Mall (http://www.dahuacheng.com) is an online shopping platform in the China market with two mainstream e-commerce models: business to business (B2B) and business to consumer (B2C). There are over 3
,00
0 suppliers all over the China to provide
an online listing of
millions of commodities. The real-time payment system of Dahua is convenient, safe and fast.
Dahua Online Shopping Mall has registered 31 million members as of November 17, 2014.
Pursuant to the Agreement, on or before January 1,
2015, CE
I
was to deliver to the Company, duly authorized, properly and fully executed documents in English, evidencing and confirming the sale of 100% of the shares of CE
I
and its assets specifically detailing the assets and an asset
v
aluation by a third-party valuator.
The valuation report was received by the Company on January 28, 2015.
Additionally, the Agreement stated that both parties have agreed that all shares issued, pursuant to the terms and conditions of this agreement, shall be issued as soon as practicable following the signing of this agreement, but all shares so issued shall be held in escrow until all terms and conditions are met.
As of the date of this filing, the various terms and conditions of the Agreement have been
fulfilled on January 28, 2015
, therefore, the share certificates representing the shares have been issued in the names of the CE
I
shareholders and the Agreement between the Company and CE
I
was
closed
on January 28, 2015
.
NOTE 2
–
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying unaudited financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States for interim financial information and with the instructions to Form 10-Q and Regulation S-X. Accordingly, the financial statements do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.
In the opinion of management, all adjustments consisting of normal recurring entries necessary for a fair statement of the periods presented for (a) the financial position, (b) the result of operations, and (c) cash flows have been made in order to make the financial statements presented not misleading. The results of operations for such interim periods are not necessarily indicative of operations for a full year.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as well as disclosure of contingent assets and liabilities at the date of the financial statements. The estimates and judgments will also affect the reported amounts for certain revenues and expenses during the reporting period. Actual results could differ from these good faith estimates and judgments.
Principles of Consolidation
On June 29, 2012, the Company incorporated Element Resources International Limited ("Element Resources") in Hong Kong. Element Resources is a wholly owned subsidiary of the Company and their financials have been included in the consolidated financial statements.
All material intercompany balances and transactions have been eliminated.
Discontinued Operations
The Company follows ASC 205-20,
"Discontinued Operations,"
to report for disposed or discontinued operations.
Cash and Cash Equivalents
Cash and cash equivalents include cash in banks, money market funds, and certificates of term deposits with maturities of less than three months from inception, which are readily convertible to known amounts of cash and which, in the opinion of management, are subject to an insignificant risk of loss in value.
Foreign Currency Translation and Re-measurement
In accordance with ASC 830, "Foreign Currency Matters," the Company's foreign operations whose functional currency is not the U.S. dollar, has its assets and liabilities translated into U.S. dollars at current exchange rates. Resulting translation adjustments are reflected as other comprehensive income (loss) in stockholders' equity. Revenue and expenses are translated at average exchange rates for the period. Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are charged to operations as incurred.
The Company and its subsidiary's functional currency is the U.S. dollar.
Concentrations of Credit Risk
The Company's financial instruments that are exposed to concentrations of credit risk primarily consist of its cash and cash equivalents a
s well as
related party payables that it will likely incur in the near future. The Company places its cash and cash equivalents with financial institutions of high credit worthiness. At times, its cash and cash equivalents with a particular financial institution may exceed any applicable government insurance limits. The Company's management plans to assess the financial strength and credit worthiness of any parties to which it extends funds, and as such, it believes that any associated credit risk exposure
is
limited.
Deferred Income Taxes and Valuation Allowance
The Company accounts for income taxes under ASC 740,
"Income Taxes." Under the asset and liability method of ASC 740,
where
deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period the enactment occurs. A valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations. No deferred tax assets or liabilities were recognized as at
June 30
, 201
4
and
March 31, 2014
.
Net Loss Per Share of Common Stock
The Company has adopted ASC Topic 260,
"Earnings per Share,"
("EPS") which requires presentation of basic EPS on the face of the income statement for all entities with complex capital structures and requires a reconciliation of the numerator and denominator of the basic EPS computation. In the accompanying financial statements, basic earnings (loss) per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period.
The following table sets forth the computation of basic earnings per share, for the three months ended
June 30
, 201
4
and 201
3
:
|
|
Three Months Ended
June 30
,
|
|
|
|
201
4
|
|
|
201
3
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(15,132
|
)
|
|
$
|
(38,159
|
)
|
|
|
|
|
|
|
|
|
|
Weighted average common shares issued and outstanding (basic and diluted)
|
|
|
191,770,362
|
|
|
|
191,770,362
|
|
|
|
|
|
|
|
|
|
|
Net loss per common share, basic and diluted
|
|
$
|
(0.00
|
)
|
|
$
|
(0.00
|
)
|
Commitments and Contingencies
The Company follows ASC 450-20, "Loss Contingencies," to report accounting for contingencies. Liabilities for loss contingencies arising from claims, assessments, litigation, fines and penalties
,
a
s well as
other sources are recorded when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated. There were no commitments or contingencies as of
June 30
, 201
4 and
March 31, 2014
.
Recent Accounting Pronouncements
Management has considered all recent accounting pronouncements issued since the last audit of our financial statements. The Company's management believes that these recent pronouncements will not have a material effect on the Company's financial statements.
Related Parties
The Company follows ASC 850,
"Related Party Disclosures,"
for the identification of related parties and disclosure of related party transactions. See note
5
.
Revenue Recognition
The Company will recognize revenue from the sale of products and services in accordance with ASC 605,
"Revenue Recognition."
However, the Company will recognize revenue only when all of the following criteria have been met:
|
i)
|
Persuasive evidence for an agreement exists;
|
|
|
|
|
ii)
|
Service has been provided;
|
|
|
|
|
iii)
|
The fee is fixed or determinable; and,
|
|
|
|
|
iv)
|
Collection is reasonably assured.
|
NOTE 3
–
GOING CONCERN
The Company's financial statements are prepared using accounting principles generally accepted in the United States applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not established an on
-
going source of revenues sufficient to cover its operating cost, and requires additional capital to commence its operating plan. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations. These factors raise substantial doubt about its ability to continue as a going concern.
In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management's plan to obtain such resources for the Company include: sales of equity instruments; traditional financing, such as loans; and obtaining capital from management and significant stockholders sufficient to meet its minimal operating expenses. However, management cannot provide any assurance that the Company will be successful in accomplishing any of its plans.
There is no assurance that the Company will be able to obtain sufficient additional funds when needed or that such funds, if available, will be obtainable on terms satisfactory to the Company. In addition, profitability will ultimately depend upon the level of revenues received from business operations. However, there is no assurance that the Company will attain profitability. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
NOTE
4
– EQUITY
Common Stock
Effective December 8, 2014
,
the Company increased the authorized capital from 1,000,000,000 common shares to 3,000,000,000 common shares.
Each common share entitles the holder to one vote, in person or proxy, on any matter on which action of the stockholders of the
Company
is sought.
As of June 30, 2014 and March 31, 2014, the Company has 191,770,362 shares of common stock issued and outstanding.
The Company has no potentially dilutive securities, such as options or warrants, currently issued and outstanding.
NOTE
5
–
RELATED PARTY TRANSACTIONS
During the three months end
ed
June 30, 2014
,
Mr. Jiang Libin,
appointed as the President and
a
director of the Company on December 12, 2015
,
has
advanced
the Company $
15,207
for operating expenses. During the three months ended March 31, 2014, Mr. Tsap Wai Ping, the former President of the Company who resigned on October 31, 2014 (the "Former President"), has advanced the Company $63,338 for operating expenses. These advances have been formalized by non-interest bearing demand notes.
As of June 30, 2014, the Company owed $
487,358
and
$15,207 to the Former President and Mr.
Jiang Li
b
in
respectively.
As of March 31, 2014, the Company owed $487,358 to the Former President.
NOTE
6
– DISCONTINUED OPERATIONS
The following presents the financial information of the discontinued subsidiary of the Company,
Element Resources International Limited
.
|
|
As of
|
|
|
A
s
of
|
|
|
|
June 30,
2014
|
|
|
March 31,
2014
|
|
Current Assets
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
-
|
|
|
$
|
-
|
|
Deposit paid
|
|
|
139,681
|
|
|
|
139,681
|
|
Other receivables, net
|
|
|
10,320
|
|
|
|
10,320
|
|
Total current assets
|
|
|
150,001
|
|
|
|
150,001
|
|
TOTAL ASSETS
|
|
$
|
150,001
|
|
|
$
|
150,001
|
|
|
|
|
|
|
|
|
|
|
Current Liabilities
|
|
|
|
|
|
|
|
|
Accounts payable and accrued liabilities
|
|
$
|
-
|
|
|
$
|
-
|
|
Note payable - related party
|
|
|
-
|
|
|
|
-
|
|
Total current liabilities
|
|
|
-
|
|
|
|
-
|
|
TOTAL LIABILITIES
|
|
$
|
-
|
|
|
$
|
-
|
|
|
|
For the
Three Months
Ended
|
|
|
|
June 30,
|
|
|
|
201
4
|
|
|
201
3
|
|
|
|
|
|
|
|
|
REVENUE
|
|
$
|
-
|
|
|
$
|
-
|
|
General and administrative
|
|
|
-
|
|
|
|
-
|
|
Other expenses
|
|
|
-
|
|
|
|
-
|
|
Net income (loss)
|
|
$
|
-
|
|
|
$
|
-
|
|
NOTE
7
–
SUBSEQUENT EVENTS
(
1
)
Effective December 8, 2014 the Company increased the authorized capital from 1,000,000,000 common shares to 3,000,000,000 common shares.
(
2
)
On February 6, 2015,
the Company
signed a Sale and Purchase Agreement to acquire 100% of the
shares and assets of Eternal Fairy International Ltd., (
"
EFI
"
), a British Virgin Island
s
corporation
.
Pursuant to the
a
greement,
the Company
has agreed to issue 1,200,000,000 (1.2 billion) restricted common shares of the
Co
mpany
to the
shareholders
of EFI. EFI
which in turn
owns
Dongguan YouDai Financial Information Services Co., Ltd
("DYD"), a company incorporated in the People's Republic of China (the "PRC")
.
DYD is a company that
focuses on peer-to-peer
("P2P")
lending
services
. DYD provides a platform that matches l
enders
directly with the borrowers and charges a commission fee. Through our P2P platform, lenders can earn higher returns compared to savings and investment products offered by banks, wh
ere
borrowers can borrow money at lower interest rates.
Closing w
as to
take place in two stages as follows:
The Company acquired the entire share capital of EFI
by the
issuance of 1.2 billion new Common Shares on February 15, 2015 (the
"Closing Date"). Immediately
on
the Closing Date,
the Company
shall deliver, or cause to be delivered, to EFI, a board resolution confirming the issuance of
1.2 billion Common Shares.
The Company
shall also deliver to EFI, share certificate(s) representing the 1.2 billion shares
issued in the name or names designated by EFI. The shares certificates so delivered will display the required
restrictive legend pursuant to Rule 144 of the United States Securities and Exchange Act.
On or before February 28, 2015, EFI was to deliver to
the Company
, duly authorized, properly and fully executed
documents in English, evidencing and confirming the sale of 100% of the shares of EFI and its assets specifically
detailing the assets and an asset valuation by an independent
valu
ator
.
Both parties agree that all shares issued, pursuant to the terms and conditions of the agreement, shall be held in
escrow and shall be deemed to be in the full control of
the Company
until the Closing is completed.
Effective September 22,
2015,
the Company has executed a Deed of Termination and Mutual Release (the "Termination") between the Company and of EFI. The Termination cancels the Sale and Purchase Agreement to acquire 100% of the shares and assets of EFI reported via a Form 8-K dated February 6, 2015.
Pursuant to the original
ag
reement
the Company
issued 1,200,000,000 (1.2 billion) restricted common shares of the C
ompany
to the owners of EFI
.
All share
s
issued under the terms of the
a
greement were held in escrow and have now been cancelled with the consent of all Parties and returned to treasury.
(
3
)
Effective November 20, 2014, the Company executed a Sale and Purchase Agreement to acquire 100% of the shares and assets of China Enterprise Overseas Investment & Finance Group Limited
("CEI")
, a British Virgin Islands corporation. Pursuant to the
a
greement,
the Company
has agreed to issue 800 million restricted common shares of the C
ompany
to
the owners of CE
I
.
Dahua Online Shopping Mall (http://www.dahuacheng.com) is an online shopping platform in the China market with two mainstream e-commerce models: business to business (B2B) and business to consumer (B2C). There are over 3000 suppliers all over China to provide
an online listing of
millions of commodities. The real-time payment system of Dahua is convenient, safe and fast.
Dahua Online Shopping Mall has registered 31 million members as of November 17, 2014.
Pursuant to the
a
greement, on or before January 1,
2015, CE
I
was to deliver to the Company, duly authorized, properly and fully executed documents in English, evidencing and confirming the sale of 100% of the shares of CE
I
and its assets specifically detailing the assets and an asset
v
aluation
prepared
by
an independent professional
ly
qualified valu
ator
.
The valuation report was received by the Company on January 28, 2015.
Additionally, the
a
greement stated that both parties have agreed that all
the
shares, pursuant to the terms and conditions of this agreement, shall be issued as soon as practicable following the signing of this agreement, but all
the
shares so issued shall be held in escrow until all terms and conditions are
fulfilled
.
T
he various terms and conditions of the
a
greement have
been
fulfilled on January 28, 2015
.As a result
, the share
s
as referred to in
the
a
greement
made
between the Company and CE
I
ha
ve been delivered on January 28, 2015
.
(
4
)
Effective October 31, 2014, the Company has accepted the resignation of Mr. Tsap Wai Ping from his position as President,
Chief Executive Officer ("
CEO
")
,
and as sole director of the Company. Mr. Tsap Wai Ping has served on the Board since June 6, 2012.
(
5
)
On October 31, 2014 the Company announced the appointment of Mr. Wang Binggang as the Company's President
, CEO
and as its sole Director.
(
6
)
Effective November 12, 2014, the Company has accepted the resignation of Mr. Wang Binggang from his position as President, CEO and as the sole director of the Company. Mr. Wang Binggang has served on the Board since October 31, 201
4
.
(
7
)
Effective November 12, 2014 the Company announced the appointment of Mr. Liu Jun as the Company's President and as its sole Director.
(
8
)
Effective
June
1
0
, 2015,
the Company
accepted the resignation of Mr. Li
u Jun
from his position as President
and a
director of the Company.
Also effective June 10, 2015 the Company announced the appointment of Mr. Li Qiuyu as the Company's
President and as its sole Director.
(
9
)
Effective December 12, 2015,
the Company
accepted the resignation of Mr. Li Qiuyu from his position as President, CEO and as a director of the Company. Mr. Li Qiuyu has served on the Board since June 10, 2015.
Also effective December 12, 2015, the Company announced the appointment of Mr. Jiang Libin as the Company's President, Secretary
,
and Director
,
and
announced
the appointment of Mr. Zhang Hong as a Director.