YUS INTERNATIONAL GROUP Ltd 0001306035 --12-31 yusg Non-accelerated Filer Yes true true false false 2018 Q2 0001306035 2018-01-01 2018-06-30 0001306035 2018-06-30 0001306035 2017-06-30 0001306035 2019-04-29 0001306035 2017-12-31 0001306035 2018-04-01 2018-06-30 0001306035 2017-04-01 2017-06-30 0001306035 2017-01-01 2017-06-30 0001306035 2016-12-31 0001306035 fil:NorthAmericaMarketingCorporationMember 2002-07-15 0001306035 fil:GlobalManiaEmpireManagementLimitedMember 2010-08-31 0001306035 fil:GlobalManiaEmpireManagementLimitedMember 2010-08-31 2010-08-31 0001306035 fil:GreatChinaMediaLimitedMember 2018-01-01 2018-06-30 0001306035 fil:YusInternationalGroupLimitedMember 2013-03-20 2013-03-20 0001306035 fil:YusInternationalHoldingsLimitedMember 2017-01-12 0001306035 fil:PbilEntertainmentHoldingsLimitedMember 2018-01-02 0001306035 fil:PbilEntertainmentHoldingsLimitedMember 2018-01-02 2018-01-02 0001306035 currency:HKDfil:PeriodEndRatesMember 2018-06-30 0001306035 currency:HKDfil:PeriodEndRatesMember 2017-12-31 0001306035 currency:HKDfil:PeriodEndRatesMember 2017-06-30 0001306035 currency:HKDfil:AverageRatesMember 2018-06-30 0001306035 currency:HKDfil:AverageRatesMember 2017-12-31 0001306035 currency:HKDfil:AverageRatesMember 2017-06-30 0001306035 fil:YusInternationalGroupLimitedMember 2018-01-01 2018-06-30 0001306035 fil:YusInternationalGroupLimitedMember 2018-06-30 0001306035 fil:YusInternationalGroupLimitedMember 2017-12-31 0001306035 fil:MrAlexCheungFaiYuMember 2018-06-30 0001306035 fil:MrAlexCheungFaiYuMember 2017-12-31 xbrli:pure iso4217:USD xbrli:shares iso4217:USD xbrli:shares

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 10-Q

 

(Mark One)

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

 

For the quarterly period ended: June 30, 2018

 

¨ 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. 000-52020

 

YUS INTERNATIONAL GROUP LIMITED

(Exact name of small business issuer as specified in its charter)

 

Nevada

 

900201309

(State or other jurisdiction of

incorporation or organization)

 

(IRS Employer

Identification No.)

 

 

 

Room A, Block B, 21/F

 

 

Billion Centre, 1 Wang Kwong Road

 

 

Kowloon Bay, Kowloon, Hong Kong

 

n/a

(Address of Principal Executive Offices)

 

(Zip Code)

 

Registrant’s telephone number, including area code: 852-36986699

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act during the preceding 12 months (or for such shorter period that the issuer was required to file such reports), and (2)has been subject to such filing requirements for the past 90 days.. Yes x No ¨

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 and post such files). Yes x 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      

(Do not check if a smaller reporting company) 

Smaller reporting company   

Emerging growth company   

 


1


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 Rule 12b-2 of the Exchange Act). Yes x No ¨

 

Securities registered to Section 12(b) of the Act: None. 

 

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

 

As of April 29, 2019, the issuer’s classes of common stock are as follows:

 

Class of Securities

 

Shares Outstanding

Common Stock, $0.1 par value

 

7,443,912 shares

 

 

 

 

TABLE OF CONTENTS

 

 

PART I – FINANCIAL INFORMATION3 

ITEM 1. UNAUDITED FINANCIAL STATEMENTS3 

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS17 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK19 

ITEM 4. CONTROLS AND PROCEDURES19 

PART II – OTHER INFORMATION20 

ITEM 1. LEGAL PROCEEDINGS20 

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS20 

ITEM 3. DEFAULTS UPON SENIOR SECURITIES20 

ITEM 4. MINE SAFETY DISCLOSURE20 

ITEM 5. OTHER INFORMATION20 

ITEM 6. EXHIBITS21 


2


 

 

PART I – FINANCIAL INFORMATION

 

ITEM 1. UNAUDITED FINANCIAL STATEMENTS

 

YUS INTERNATIONAL GROUP LIMITED

CONDENSED CONSOLIDATED BALANCE SHEETS

 

 

 

 

June 30,

 

December 31,

ASSETS

 

2018

 

2017

 

Notes

 

 

 

Current assets

 

 

 

 

Prepayment

 

89,743

 

89,743

Amount due from major stockholder

7

210,345

 

210,345

Amount due from a director

7

194,076

 

-

Cash and cash equivalents

 

350,868

 

48,896

 

 

 

 

 

Total current assets

 

845,032

 

348,984

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

Accrued expenses

5

29,472

 

24,723

Amount due to a director

 

-

 

132,462

 

 

 

 

 

 

 

 

 

 

Total current liabilities

 

29,472

 

157,185

 

 

 

 

 

Non-Current liabilities

 

 

 

 

Deposit received

6

641,026

 

-

 

 

 

 

 

Total liabilities

 

670,498 

 

157,185 

 

Stockholders ‘equity

 

 

 

 

 

 

 

 

 

Common stock, Par value $0.1, 225,000,000 shares authorized; 7,443,912 shares issued and outstanding as of June 30, 2018 and 2017 respectively

8

744,391

 

744,391

Additional paid in capital

 

669,937

 

669,937

Merger reserve

 

4,268

 

4,268

Accumulated deficit

 

(1,244,062)

 

(1,226,797))

 

 

 

 

 

 Total stockholders’ equity

 

174,534

 

191,799

 

 

 

 

 

Total liabilities and stockholders’ equity

 

845,032

 

348,984

 

See accompanying notes to the financial statements

 


3


 

 

YUS INTERNATIONAL GROUP LIMITED

CONDENSED STATEMENTS OF OPERATIONS

AND COMPREHENSIVE INCOME (UNAUDITED)

 

 

 

 

For the three months ended

June 30

 

For the six months ended

June 30,

 

 

2018

 

2017

 

2018

 

2017

 

 

-

 

-

 

 

 

 

Revenue

 

 

 

 

 

-

 

-

 

 

 

 

 

 

 

 

 

Cost of sales

 

-

 

-

 

-

 

-

 

 

 

 

 

 

 

 

 

Gross profit

 

 

 

 

 

-

 

-

 

 

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

 

 

General & administrative

 

12,708

 

-

 

17,310

 

5,050

 

 

 

 

 

 

 

 

 

Loss from operations

 

(12,708)

 

-

 

(17,310)

 

(5,050)

 

 

 

 

 

 

 

 

 

Other income / (expenses)

 

 

 

 

 

 

 

 

Interest income

 

32

 

-

 

45

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss before provision for income taxes

 

(12,676)

 

-

 

(17,265)

 

(5,050)

 

 

 

 

 

 

 

 

 

Provision for income taxes

 

-

 

-

 

-

 

-

 

 

 

 

 

 

 

 

 

Net loss for the period

 

(12,676)

 

-

 

(17,265)

 

(5,050)

 

 

 

 

 

 

 

 

 

Other comprehensive income

 

-

 

-

 

- 

 

-

 

 

 

 

 

 

 

 

 

Total comprehensive loss for the period

 

(12,676)

 

                   -

 

(17,265)

 

(5,050)

 

 

 

 

 

 

 

 

 

Loss per share, basic and diluted

 

(0.002)

 

(0.000)

 

(0.002)

 

(0.001)

 

 

 

 

 

 

 

 

 

Weighted average number of shares outstanding - basic and diluted

 

 

7,443,912

 

 

7,433,912

 

7,443,912

 

7,437,008

 

 

See accompanying notes to the condensed financial statements.

 


4


 

 

YUS INTERNATIONAL GROUP LIMITED

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)

 

 

 

 

For the six months

Ended June 30,

 

 

2018

 

2017

 

 

 

 

 

Cash flows from operating activities:

 

 

 

 

Net loss for the period

 

(17,265)

 

(5,050)

Adjustments to reconcile net loss to net cash flows used in operating activities for:

 

 

 

 

Interest income

 

(45)

 

-

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

 

Increase / (decrease) in accrued expenses

 

4,749

 

(12,850)

 

 

 

 

 

Net cash used in operating activities

 

(12,561)

 

(17,900)

 

 

 

 

 

Cash flows from Investing activities

 

 

 

 

Interest received

 

45

 

-

 

 

 

 

-

 

 

 

 

 

Net cash generated from investing activities

 

45

 

-

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

Net proceed from issuance of new share capital

 

-

 

312,395

Addition in merge reserve

 

-

 

2,986

Increase in deposits received

 

641,026

 

 

Increase in amount due from major stockholder

 

-

 

(210,345)

Increase in amount due from a director

 

(194,076)

 

-

(Decrease) /increase in amount due to a director

 

(132,462)

 

-

Decrease in amount due to a shareholder

 

-

 

(74,150)

Decrease in amount due to related parties

 

-

 

(12,986)

 

 

 

 

 

Net cash generated from financing activities

 

314,488

 

17,900

 

 

 

 

 

Net change in cash and cash equivalents

 

301,972

 

-

 

 

 

 

 

Cash and cash equivalents at beginning of period

 

48,896

 

48,896

 

 

 

 

 

Cash and cash equivalents at the end of period

 

350,868

 

48,896

 

 

 

 

 

 

 

See accompanying notes to the condensed financial statements.

 


5


 

 

YUS INTERNATIONAL GROUP LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

NOTE 1 – ORGANIZATION AND PRINCIPAL ACTIVITIES

 

The Company was incorporated under the laws of the State of Delaware on July 15, 2002 with authorized common stock of 50,000,000 shares at $0.001 par value with the name “North America Marketing Corporation”. On March 29, 2004, the Company changed the domicile to the State of Nevada. On December 30, 2008, the Company entered into and completed an agreement for share exchange to acquire 100% ownership of Asian Trends Broadcasting Inc. (“Asian Trends”) from its shareholders. Asian Trends operates liquid crystal display (“LCD”) flat-panel televisions and LCD billboards that advertise throughout Hong Kong and creates revenue by selling advertising airtime.

 

At the beginning of 2010, the Company was principally engaged in operating LCD flat-panel televisions and LCD billboards that advertise throughout Hong Kong, creating revenue by selling advertising airtime. On August 31, 2010 the Company acquired 100% ownership of Global Mania Empire Management Limited (“GME”) from its shareholders with a consideration of 22,147,810 shares. GME is a Hong Kong company that specializes in project and artist management. On January 21, 2011, the Company sold GME back to the original shareholders by receiving 22,147,810 shares of the Company’s common stock.

 

The Company assigned the LCD flat-panel televisions and LCD billboards advertisement operations to Great China Media Limited (the “Assignee”), and in return the Assignee shall pay 5% of the gross proceeds from the business to the Company. Revenue is recognized in arrears on a quarterly basis and when collectability is reasonably assured.

 

On March 20, 2013, the Board approved the change of the Company’s name to Yus International Group Limited and a one hundred-for-one (100:1) reverse stock split applying to all shares of common stock in the Company.

 

On April 29, 2013, the majority shareholder of the Company entered into a series of stock purchase agreements wherein the majority shareholder of the Company agreed to sell a total of 6,624,789 shares of common stock in the Company to four third-party entities. On April 30, 2013, after the receipt of consideration and completion of all conditions precedent, the stock purchase agreements were completed and closed.

 

On May 16, 2013, Zhi Jian Zeng resigned as the Chief Executive Officer and director of the Company and Huang Jian Nan resigned as the Chief Financial Officer and director of the Company.

 

On May 16, 2013, Mr. Ho Kam Hang was appointed as the Chief Executive Officer of the Company and Dr. Chong Cheuk Man Yuki was appointed as the Chief Financial Officer of the Company. On that same date, the company appointed Mr. Yu Cheung Fai Alex, Ms. Chan Fuk Yu, Mr. Yu Lok Man and Mr. Yu Ka Wai as Directors of the Company.

 

On April 9, 2014, Mr. Yu Lok Man resigned as director of the Company and Dr. Chong Cheuk Man Yuki resigned as Chief Financial Officer of the Company. On the same day, Ms. Chen Yongqi Dawn was appointed as Chief Financial Officer of the Company.

 

On July 31, 2014, Ms. Chen Yongqi Dawn resigned as Chief Financial Officer of the Company. On the same day, Ms. Chan Fuk Yu was appointed as Chief Financial Officer of the Company.

 


6


 

 

YUS INTERNATIONAL GROUP LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

NOTE 1 – ORGANIZATION AND PRINCIPAL ACTIVITIES (CONTINUED)

 

On January 12, 2017, the Company acquired 100% of the outstanding equity capital of YUS International Holdings Limited (“YIH”) for US$10,000 from Ho Kam Hang, the Company’s Chief Executive Officer, and Yu Cheung Fai Alex, a director of the Company. This transaction has the effect of making YIH a wholly-owned subsidiary of the Company. YIH is a limited company organized under the laws of Hong Kong. Other than holding dormant bank accounts, YIH has no material assets, liabilities, or operations. It is accounted for as a common control business combination under ASC 805.

 

On September 30, 2017, Mr. Yu Ka Wai resigned as director of the Company.

 

On January 2, 2018, the Company, through its subsidiary, YIH, to acquire 100% of the outstanding equity capital of PBIL Entertainment (Holdings) Limited (“PBIL”) for US$1,282 from Law Kwok Lun, Alan. This transaction has the effect of making PBIL a wholly-owned subsidiary of the Company. PBIL is a limited company organized under the laws of Hong Kong. PBIL has no material assets, liabilities, or operations.

 

 

 Details of the Company’s wholly owned subsidiaries as of June 30, 2018 and 2017 are as follows:

 

Company

 

Date of Establishment

 

Place of Establishment

 

Percentage of Ownership by the Company 

 

Principal Activities

 

 

 

 

 

 

2018

 

2017

 

 

PBIL Entertainment (Holdings) Limited

 

December 19, 2017

 

Hong Kong

 

 

100%

 

-

 

Dormant

YUS International Holdings Limited

 

December 23, 2013

 

Hong Kong

 

 

100%

 

100%

 

Investment holding

 

Our current business plan is to seek and identify appropriate business opportunities for development of our new line of business. We intend to seek opportunities demonstrating the potential of long-term growth as opposed to short-term earnings. However, at the present time, we have not identified any business opportunities that we plan to pursue, nor have we reached any agreement or definitive understanding with any person concerning an acquisition or merger.


7


 

 

YUS INTERNATIONAL GROUP LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

 

 

NOTE 2 – BASIS OF PRESENTATION

 

The unaudited consolidated financial statements of the Company have been prepared pursuant to the rules and regulations of the SEC. Certain information and disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the following disclosures are adequate to make the information presented not misleading. All significant intercompany balances and transactions have been eliminated.

 

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities. Actual results could differ from these estimates.

 

For the three months ended and as of June 30, 2018, the unaudited consolidated financial statements include the accounts of the Company and the following wholly-owned subsidiary:

 

1)YUS International Holdings Limited (a Hong Kong corporation) (“YIH”) 

2)PBIL Entertainment (Holdings) limited (a Hong Kong corporation) (“PBIL”) 

 

The acquisition of all of the issued and outstanding stock of PBIL and YIH were on January 2, 2018 and January 12, 2017 respectively. All significant inter-company balances and transactions have been eliminated.

 

In the opinion of the management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position as of June 30, 2018, results of operations and cash flows for the six months ended June 30, 2018. The results of operations for the six months ended June 30, 2018 are not necessarily indicative of the operating results for the full period.

 


8


 

 

YUS INTERNATIONAL GROUP LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

 

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

(a) Cash and Cash Equivalents

 

The Company considers all highly liquid investments purchased with original maturities of three months or less to be cash equivalents.

 

(b) Fair Value of Financial Instruments

 

The carrying amounts of financial instruments such as cash and accounts payable approximate their fair value because of the short maturities of these instruments. The fair value of receivables from associated companies and payables to associated companies are not practical to estimate based upon the related party nature of the underlying transactions.

 

(c) Financial assets

 

(i) Classification

 

The Company classifies its financial assets in the following measurement categories:

 

·those to be measured subsequently at fair value  

·(either through other comprehensive income, or through profit or loss), and those to be measured at amortized cost 

·The classification depends on the entity’s business model for managing the financial assets and the contractual terms of the cash flows. 

 

(ii) Recognition and derecognition

 

Regular way purchases and sales of financial assets are recognized on trade-date, the date on which the Company commits to purchase or sell the asset. Financial assets are derecognized when the rights to receive cash flows from the financial assets have expired or have been transferred and the Company has transferred substantially all the risks and rewards of ownership.

 

(iii) Measurement

 

At initial recognition, the Company measures a financial asset at its fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at fair value through profit or loss are expensed in profit or loss.

 

Financial assets with embedded derivatives are considered in their entirety when determining whether their cash flows are solely payment of principal and interest.


9


 

 

YUS INTERNATIONAL GROUP LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

 

(c) Financial assets (continued)

 

Debt instruments

 

Subsequent measurement of debt instruments depends on the Company’s business model for managing the asset and the cash flow characteristics of the asset. There are three measurement categories into which the Company classifies its debt instruments:

 

Amortized cost: Assets that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest are measured at amortized cost. Interest income from these financial assets is included in finance income using the effective interest rate method. Any gain or loss arising on derecognition is recognized directly in profit or loss and presented in other gains/(losses) together with foreign exchange gains and losses. Impairment losses are presented as separate line item in the statement of profit or loss.

 

Fair value through other comprehensive income (“FVOCI”): Assets that are held for collection of contractual cash flows and for selling the financial assets, where the assets’ cash flows represent solely payments of principal and interest, are measured at FVOCI. Movements in the carrying amount are taken through other comprehensive income, except for the recognition of impairment gains or losses, interest income and foreign exchange gains and losses which are recognized in profit or loss. When the financial asset is derecognized, the cumulative gain or loss previously recognized in other comprehensive income is reclassified from equity to profit or loss and recognized in other gains/(losses). Interest income from these financial assets is included in finance income using the effective interest rate method. Foreign exchange gains and losses are presented in other gains/(losses) and impairment expenses are presented as a separate line item in the statement of profit or loss.

 

Fair value through profit or loss (“FVPL”): Assets that do not meet the criteria for amortized cost or FVOCI are measured at FVPL. A gain or loss on a debt investment that is subsequently measured at FVPL is recognized in profit or loss and presented net within other gains/(losses) in the period in which it arises.

 

Equity instruments

 

The Company subsequently measures all equity investments at fair value. Where the Company’s management has elected to present fair value gains and losses on equity investments in other comprehensive income, there is no subsequent reclassification of fair value gains and losses to profit or loss following the derecognition of the investment. Dividends from such investments continue to be recognized in profit or loss as other income when the Company’s right to receive payments is established.

 

Changes in the fair value of financial assets at FVPL are recognized in other gains/(losses) in the statement of profit or loss as applicable. Impairment losses (and reversal of impairment losses) on equity investments measured at FVOCI are not reported separately from other changes in fair value.


10


 

 

YUS INTERNATIONAL GROUP LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

 

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

 

(c) Financial assets (continued)

 

Impairment of financial assets

 

The Company assesses on a forward looking basis the expected credit losses associated with its debt instrument carried at amortized cost. The impairment methodology applied depends on whether there has been a significant increase in credit risk.

 

(d) Financial liabilities

 

Financial liabilities are classified, at initial recognition, as financial liabilities at fair value, in the case of loans and borrowings and payables, net of directly attributable transactions costs.

 

The subsequent measurement of financial liabilities of interest-bearing loans and borrowings are subsequently measured at amortized cost, using the effective interest rate method unless the effect of discounting would be immaterial, in which case they are stated at cost. Gain and losses are recognized in profit or loss when the liabilities are derecognized as well as through effective interest rate method amortization process. The effective interest rate amortization is included in finance costs in the statement of profit or loss.

 

Financial liability is derecognized when the obligation under liability is discharged or cancelled, or expires.

 

Offsetting of financial instruments

 

Financial assets and financial liabilities are offset and the net amount is reported in the statement of financial position if there is a current enforceable legal right to offset the recognized amounts and there is an intention to settle on a net basis, or to realize the assets and settle the liabilities simultaneously.

 

(e) Earnings/Losses Per Share

 

Basic earnings/losses per share is computed by dividing income/loss available to common shareholders by the weighted-average number of common shares outstanding during the period. Diluted earnings/losses per share is computed similar to basic earnings/losses per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. As of the balance sheet dates, there were no dilutive securities outstanding.


11


 

 

YUS INTERNATIONAL GROUP LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

 

(f) Foreign Currency Translation

 

The Company translates its foreign operations to US dollars in accordance with ASC 830, “Foreign Currency Matters.” The Company’s functional currency and reporting currency is U.S. dollar, except its subsidiary’s functional currency is Hong Kong Dollars (“HKD”).

 

The Company’s subsidiary, whose records are not maintained in that company’s functional currency, re-measure its records into its functional currency as follows:

 

 

·

Monetary assets and liabilities at exchange rates in effect at the end of each period

 

·

Nonmonetary assets and liabilities at historical rates

 

·

Revenue and expense items at the average rate of exchange prevailing during the period

 

Gains and losses from these remeasurements were not significant and have been included in the Company’s results of operations.

 

The Company’s subsidiary, whose functional currency is not the U.S. dollar, translates their records into U.S. dollar as follows:

 

 

·

Assets and liabilities at the rate of exchange in effect at the balance sheet date

 

·

Equities at historical rate

 

·

Revenue and expense items at the average rate of exchange prevailing during the period

 

 

The translation rates are as follows:

 

 

 

6 months

ended

June 30,

2018

 

 

Year ended

December 31,

2017

 

 

6 months

ended

June 30,

2017

 

 

 

 

 

 

 

 

 

 

 

Period/year end HK$ : US$ exchange rate

 

 

0.1282

 

 

 

0.1282

 

 

 

0.1282

 

Average HK$ : US$ exchange rate for the period/year

 

 

0.1282

 

 

 

0.1282

 

 

 

0.1282

 

 

(g) Recent Accounting Pronouncements

 

In February 2018, the FASB issued ASU No. 2018-02, “Reclassification of Certain Tax Effects From Accumulated Other Comprehensive Income.” The ASU amends ASC 220,  Income Statement — Reporting Comprehensive Income, to “allow a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act.” In addition, under the ASU, an entity will be required to provide certain disclosures regarding stranded tax effects. The ASU is effective for all entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. The Company does not expect that the adoption of this guidance will have a material impact on its consolidated financial statements.


12


 

 

YUS INTERNATIONAL GROUP LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

 

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

 

In March 2018, the FASB issued ASU 2018-05 — Income Taxes (Topic 740): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118 (“ASU 2018-05”), which amends the FASB Accounting Standards Codification and XBRL Taxonomy based on the Tax Cuts and Jobs Act (the “Act”) that was signed into law on December 22, 2017 and Staff Accounting Bulletin No. 118 (“SAB 118”) that was released by the Securities and Exchange Commission. The Act changes numerous provisions that impact U.S. corporate tax rates, business-related exclusions, and deductions and credits and may additionally have international tax consequences for many companies that operate internationally. The Company does not believe this guidance will have a material impact on its consolidated financial statements.

 

In July 2018, the FASB issued ASU 2018-10, “Codification Improvements to Topic 842, Leases.” The ASU addresses 16 separate issues which include, for example, a correction to a cross reference regarding residual value guarantees, a clarification regarding rates implicit in lease contracts, and a consolidation of the requirements about lease classification reassessments. The guidance also addresses lessor reassessments of lease terms and purchase options, variable lease payments that depend on an index or a rate, investment tax credits, lease terms and purchase options, transition guidance for amounts previously recognized in business combinations, and certain transition adjustments, among others. For entities that early adopted Topic 842, the amendments are effective upon issuance of this Update, and the transition requirements are the same as those in Topic 842. For entities that have not adopted Topic 842, the effective date and transition requirements will be the same as the effective date and transition requirements in Topic 842. The Company does not believe this guidance will have a material impact on its consolidated financial statements.

 

In July 2018, the FASB issued ASU 2018-11 - Leases (Topic 842): Targeted Improvements. The ASU simplifies transition requirements and, for lessors, provides a practical expedient for the separation of nonlease components from lease components. Specifically, the ASU provides: (1) an optional transition method that entities can use when adopting ASC 842 and (2) a practical expedient that permits lessors to not separate nonlease components from the associated lease component if certain conditions are met. For entities that have not adopted Topic 842 before the issuance of this Update, the effective date and transition requirements for the amendments in this Update are the same as the effective date and transition requirements in Update 2016-02. For entities that have adopted Topic 842 before the issuance of this Update, the transition and effective date of the amendments in this Update are as follows: 1) The practical expedient may be elected either in the first reporting period following the issuance of this Update or at the original effective date of Topic 842 for that entity. 2) The practical expedient may be applied either retrospectively or prospectively. All entities, including early adopters, that elect the practical expedient related to separating components of a contract in this Update must apply the expedient, by class of underlying asset, to all existing lease transactions that qualify for the expedient at the date elected. The Company does not believe this guidance will have a material impact on its consolidated financial statements.

 

Management has considered all other 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.


13


 

 

YUS INTERNATIONAL GROUP LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

NOTE 4 – GOING CONCERN

 

The accompanying condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As of June 30, 2018, the Company has accumulated deficits of $1,244,062.

 

As of June 30, 2018, the Company may need additional cash resources to operate during the upcoming 12 months, and the continuation of the Company may be dependent upon the continuing financial support of investors, directors and/or shareholders of the Company. The Company intends to attempt to acquire additional operating capital through private equity/debt offerings to the public and existing investors to fund its business plan. However, there is no assurance that equity or debt offerings will be successful in raising sufficient funds to assure the eventual profitability of the Company. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts of and classification of liabilities that might be necessary in the event the Company cannot continue in existence.

 

NOTE 5 – ACCRUED EXPENSES

 

Accrued expenses as of June 30, 2018 and December 31, 2017 represent accrued fees payable to various professional parties and service providers.

 

NOTE 6 – DEPOSITS RECEIVED

 

 

 

June 30,
2018

 

 

December 31,
2017

 

 

 

 

 

 

Deposits received for bonds  

 

641,026

 

 

-

 

During the period, the Company entered into the bond subscription agreement with a lender and received deposit fund. Up to report date, the process of the bond has not been completed yet, and the deposit received is interest free until the completion of the issuance of the bond.

 

NOTE 7– AMOUNT DUE FROM A DIRECTOR AND MAJOR STOCKHOLDER

 

The balances as of June 30, 2018 and December 31, 2017 are unsecured, interest-free and have no fixed repayment terms.

 

NOTE 8 – CAPITAL STOCK

 

The Company is authorized to issue 225,000,000 shares of common stock, $0.1 par value. As of June 30, 2018, there were 7,443,912 shares of the Company’s common stock issued and outstanding.

 

As of June 30, 2018 Huang Jian Nan owned 624,789 shares or 8.4% of the Company’s common stock, and YUS International Group Limited owned 6,624,789 shares, or 89% of the Company’s common stock. Other than Huang Jian Nan and YUS International Group Limited, no person owns 5% or more of the Company’s issued and outstanding shares.


14


 

 

YUS INTERNATIONAL GROUP LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

NOTE 9 - TAXATION

 

The Company has not recognized an income tax benefit for its operating losses generated based on uncertainties concerning its ability to generate taxable income in future periods. The tax benefit for the periods presented is offset by a valuation allowance established against deferred tax assets arising from the net operating losses and other temporary differences, the realization of which could not be considered more likely than not. In future periods, tax benefits and related deferred tax assets will be recognized when management considers realization of such amounts to be more likely than not. For the period ended June 30, 2018 and 2017, the Company incurred losses, resulting from operating activities, which result in deferred tax assets at the effective statutory rates. The deferred tax asset has been off-set by an equal valuation allowance.

 

The Company changed the domicile to the State of Nevada in 2004. Under the current law of Nevada, the Company is not subject to state corporate income tax. No provision for federal corporate income tax has been made in the financial statements as there are no assessable profits.

 

PBIL and YIH were incorporated under the laws of Hong Kong. Hong Kong profits tax rate is 16.5%. It is provided that profits tax rate 8.25% on assessable income up to $256,410 and 16.5% on any part of assessable profits over $ 256,410. PBIL and YIH did note generated taxable income in the Hong Kong for the six months ended June 30, 2018 and 2017, and therefore, PBIL and YIH were not subject to Hong Kong profits tax.

 

NOTE 10- RELATED PARTY TRANSACTIONS

 

a.Related parties: 

Name of related parties

 

Relationship with the Company

YUS International Group Limited

 

Major stockholder  

Mr. Alex Cheung Fai Yu

 

Director

 

b.The Company had the following related party balances at June 30, 2018 and 2017 

 

 

 

 

June 30,
2018

 

 

December 31,
2017

 

 

 

 

 

 

 

 

 

 

Due from major stockholder:

 

 

 

 

 

 

 

YUS International Group Limited

 

210,345

 

 

210,345

 

 

 

 

 

 

 

 

 

 

Due from / (to) a director:

 

 

 

 

 

 

 

Mr. Alex Cheung Fai Yu

 

194,076

 

 

(132,462)

 

 

As of June 30, 2018, and 2017, the above amounts due from a major stockholder and a director are without interest and due on demand, respectively.


15


 

 

NOTE 11 – COMMITMENTS AND CONTINGENCIES

 

Operating lease commitments

 

As of June 30, 2018, and 2017, the Company did not have commitments and contingency liability.

 

Legal proceeding

 

The Company is not currently a party to any legal proceeding, investigation or claim which, in the opinion of the management, is likely to have a material adverse effect on the business, financial condition or results of operation

 


16


 

 

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

 

Results of Operation – Three Months Ended June 30, 2018

 

The following table summarizes the result of our operation during the three months ended June 30, 2018.

 

 

 

 

Six months ended

June 30,

 

 

Increase

 

 

 

 

 

 

2018

 

 

2017

 

 

(decrease)

 

 

% Change

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

$

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Gross profit

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Other Revenue

 

 

45

 

 

 

-

 

 

 

45

 

 

 

-

 

General & administrative

 

 

(17,310

)

 

 

(5,050

)

 

 

(12,260)

 

 

 

242.77

 

Loss from operations

 

 

(17,310

)

 

 

(5,050

)

 

 

(12,260)

 

 

 

242.77

 

Income tax expenses

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Loss for the period

 

$

(17,265

)

 

 

(5,050

)

 

 

(12,215)

 

 

 

241.88

 

 

General and administrative expenses

 

There was $17,310 in general and administrative expenses between the six months ended June 30, 2018 and the six months ended June 30, 2017. The management has tried its best to fix the total professional fees for two quarters at around US$17,310. As the Group is still dormant, this can be achieved with the cooperation of all the professional parties provided the increase in one item of professional fees are compensated by the decreases in other items of professional fees.

 

Net loss

 

Net loss was $17,265 for the six months ended June 30, 2018 which was $12,215 more than the six months ended June 30, 2017.

  


17


 

 

Liquidity and Capital Resources from Operations

 

Cash

 

There was cash balance of US$350,868 as of June 30, 2018.

 

Cash flows

 

Net cash used in operating activities was US$ (12,561) for the six months ended June 30, 2018, compared with US$(17,900) for the six months ended June 30, 2017. The decrease in net cash outflow is due to increase in accrued expenses.

 

Net cash from investing activities was US$45 for the six months ended June 30, 2018, compared with US$0 for the six months ended June 30, 2017. The increase in net cash inflow is due to the interest received.

 

Net cash provided by financing activities for the six months ended 30, 2018 was $314,488. It was mainly due to an increase in deposits of $641,026 for bond subscriptions from a lender.

 

Working capital

 

As of June 30, 2018, we had a working capital surplus of $815,560 consisting of cash on hand of $350,868 as compared to working capital surplus of $191,799 and cash on hand of $48,896 as of December 31, 2017.


18


 

 

Inflation

 

Inflation does not materially affect our business or the results of our operations.

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

There have been no material changes in market risk since the filing of the Company’s Annual Report on Form 10-K for the year ended December 31, 2017.

 

ITEM 4. CONTROLS AND PROCEDURES

 

Evaluation of disclosure controls and procedures

 

Our management, including our Chief Executive Officer and Chief Financial Officer, has concluded that our disclosure controls and procedures are appropriate and effective. They have evaluated these controls and procedures as of the date of this report on Form 10-Q. There were no significant changes in our internal controls or in other factors that could significantly affect these controls subsequent to the date of their evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

 

Our management believes that our disclosure controls and procedures and internal control over financial reporting are designed to provide reasonable assurance of achieving their objectives and are effective at the reasonable assurance level. However, our management does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. These inherent limitations include the realities that judgments in decision making can be faulty, and that breakdowns can occur because of a simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people or by management override of the controls. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with policies or procedures may deteriorate. Because of the inherent limitations in a cost effective control system, misstatements due to error or fraud may occur and not be detected.

 

The Company’s management confirms that there was no change in the Company’s internal control over financial reporting during the quarter ended March 31, 2018 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

 


19


 

 

PART II – OTHER INFORMATION

 

ITEM 1. LEGAL PROCEEDINGS

 

From time to time, we may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business. Except as set forth below, we are currently not aware of any such pending or threatened legal proceedings or claims that we believe will have a material adverse effect on our business, financial condition or operating results.

 

On January 31, 2019, the SEC sent a letter to the Company stating that it may revoke the Company’s registration under the Securities Act of 1933. The Company did not receive the letter until the following month. The Company is making efforts to become current in its filings.

 

ITEM 1A. RISK FACTORS

 

Not required for smaller reporting companies.

 

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

 

There have been no unregistered sales of equity securities since last reported on the Company’s Form 10-K or 10-Q filed with the SEC.

 

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

 

None.

 

ITEM 4. MINE SAFETY DISCLOSURE

 

Not applicable.

 

ITEM 5. OTHER INFORMATION

 

None.

 


20


 

 

ITEM 6. EXHIBITS

 

Exhibits

 

 

Exhibit

Number

 

Description

 

 

 

31.1

 

Certification of Chief Executive Officer filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2

 

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

32.1

 

Certification of Chief Executive Officer furnished pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2

 

Certification of Chief Financial Officer furnished pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002


21


 

 

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.

 

 

 

YUS INTERNATIONAL GROUP LIMITED

 

 

 

 

 

Dated: May 31, 2019

By:

/s/ Ho Kam Hang

 

 

 

Ho Kam Hang

 

 

 

Chief Executive Officer

 

 

 

 

 

Dated: May 31, 2019

By:

/s/ Chan Fuk Yu

 

 

 

Chan Fuk Yu

 

 

 

Chief Financial Officer

 


22