JRSIS HEALTH CARE Corp - FORM 10-Q

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EX-32.2 - CERTIFICATION - JRSIS HEALTH CARE Corp	v409950_ex32-2.htm
EX-31.2 - CERTIFICATION - JRSIS HEALTH CARE Corp	v409950_ex31-2.htm
EX-31.1 - CERTIFICATION - JRSIS HEALTH CARE Corp	v409950_ex31-1.htm
EXCEL - IDEA: XBRL DOCUMENT - JRSIS HEALTH CARE Corp	Financial_Report.xls
EX-32.1 - CERTIFICATION - JRSIS HEALTH CARE Corp	v409950_ex32-1.htm

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 March 31, 2015

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

For the transition period from to

Commission File Number: 333-194359

JRSIS HEALTH CARE CORPORATION.

(Exact name of Registrant as specified in its charter)

Florida

8099

46-4562047

(State or other jurisdiction of incorporation
or organization)

(Primary Standard Industrial Classification
Code Number)

(I.R.S. Employer

Identification Number)

1 ^st – 7 ^th Floor, Industrial and Commercial Bank Building,

Xingfu Street, Hulan Town, Hulan District, Harbin City,

Heilongjiang Province, China 150025

(Address, including zip code, and telephone number, including area code,

of Registrant’s principal executive offices)

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 of 1934 (Exchange Act) during the preceding 12 months (or for such shorter period that the registrant 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 Website, 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 definition of “large 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	Yes x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

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

As of the date of filing of this report, there were outstanding 13,915,000 shares of the issuer’s common stock, par value $0.001 per share.

TABLE OF CONTENTS

		Page
PART I – FINANCIAL INFORMATION		3

Item 1	Consolidated Financial Statements	3

Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	4

Item 3	Quantitative and Qualitative Disclosures About Market Risk	11

Item 4	Controls and Procedures	11

PART II – OTHER INFORMATION		11

Item 1	Legal Proceedings	11

Item 1A	Risk Factors	11

Item 2	Unregistered Sale of Equity Securities and Use of Proceeds	11

Item 3	Defaults Upon Senior Securities	12

Item 4	Mine Safety Disclosures	12

Item 5	Other Information	12

Item 6	Exhibits	12

	Signatures	12

PART I – FINANCIAL INFORMATION

Item 1. Consolidated Financial Statements

The accompanying unaudited consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and Item Regulation S-X, Rule 10-01(c) Interim Financial Statements, and, therefore, do not include all information and footnotes necessary for a complete presentation of financial position, results of operations, cash flows, and stockholders' equity in conformity with generally accepted accounting principles. In the opinion of management, all adjustments considered necessary for a fair presentation of the results of operations and financial position have been included and all such adjustments are of a normal recurring nature. Operating results for the three months ended March 31, 2015 are not necessarily indicative of the results that can be expected for the year ended December 31, 2015.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

	Page

JRSIS HEALTH CARE CORPORATION

Consolidated Balance Sheets— March 31, 2015 (Unaudited) and December 31, 2014	F-2

Consolidated Statements of Operations and Comprehensive Income for the Three Months Ended March 31, 2015 and 2014 (Unaudited)	F-3

Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2015 and 2014 (Unaudited)	F-4

Notes to Consolidated Financial Statements (Unaudited)	F5-18

F-1

JRSIS HEALTH CARE CORPORATION

CONSOLIDATED BALANCE SHEETS

(AMOUNTS IN USD, EXCEPT SHARES)

	March 31,		December 31,
	2015		2014
	(Unaudited)
Assets
Current Assets:
Cash and cash equivalents	$	476,489	$	1,046,485
Accounts receivable, net		1,076,085		661,665
Inventories		285,046		180,630
Other receivables		3,562		1,755
Prepayments		957,788		691,802
Advance to related parties		80,713		185,391
Deposits for capital leases - current portion		150,966		92,630
Total current assets		3,030,649		2,860,358

Property and equipment, net		21,137,554		20,331,864
Deposits for capital leases		786,197		677,013
Total assets	$	24,954,400	$	23,869,235

Liabilities and shareholders’ equity
Current Liabilities:
Accounts payable	$	284,257	$	291,097
Short-term bank loans		473,810		471,277
Deposits received		6,475		6,526
Due to related parties		434,939		1,297,036
Other payable		50,065		71,562
Payroll payable		34,789		30,808
Capital lease obligations - current portion		1,190,520		807,478
Total current liabilities		2,474,855		2,975,784

Capital lease obligations		16,808,126		15,903,211
Total liabilities	$	19,282,981	$	18,878,995

Shareholders’ equity
Common stock; $0.001 par value, 100,000,000 shares authorized; 13,915,000 and 13,604,000 issued and outstanding at March 31, 2015 and December 31, 2014, respectively		13,915		13,604
Additional Paid-in capital		1,132,423		954,686
Retained earnings		1,335,509		1,011,471
Other comprehensive income		36,185		14,045
Total shareholders’ equity of the Company		2,518,032		1,993,806
Non-controlling interest		3,153,387		2,996,434
Total shareholders’ equity		5,671,419		4,990,240
Total liabilities and shareholders’ equity	$	24,954,400	$	23,869,235

The accompanying notes are an integral part of these consolidated financial statements.

F-2

JRSIS HEALTH CARE CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

(AMOUNTS IN USD, EXCEPT SHARES)

	Three Months Ended March 31,
	2015		2014
	(Unaudited)		(Unaudited)
Revenue:
Medicine	$	1,135,846	$	782,442
Patient services		1,291,876		747,148
Total revenue		2,427,722		1,529,590
Operating costs and expenses:
Cost of medicine sold		709,801		464,415
Medical consumables		145,595		97,518
Salaries and benefits		380,649		261,300
Office supplies		31,766		19,562
Vehicle expenses		7,301		13,348
Utilities expenses		191,648		24,118
Rentals and leases		-		42,321
Advertising and promotion expenses		-		1,942
Interest expense		289,169		250,834
Professional fee		18,462		62,746
Depreciation		193,835		32,819
Total operating costs and expenses		1,968,226		1,270,923
Earnings from operations before other income and income taxes		459,496		258,667
Other income		12,540		9,968
Earnings from operations before income taxes		472,036		268,635
Income tax		-		781
Net income		472,036		267,854
Less: net income attributable to non-controlling interests		147,998		99,414
Net income attributable to the Company	$	324,038	$	168,440
Other comprehensive income:
Foreign currency translation adjustment attributable to non-controlling interests		8,955		(8,545	)
Foreign currency translation adjustment attributable to the Company		22,140		(18,675	)
Comprehensive income	$	503,131	$	240,634
Less: Comprehensive income attributable to non-controlling interests		156,953		90,869
Comprehensive income attributable to the Company	$	346,178	$	149,765
Basic and diluted earnings per share	$	0.0237	$	0.0128
Weighted average number of shares outstanding basic and diluted		13,659,289		13,200,578

The accompanying notes are an integral part of these consolidated financial statements.

F-3

JRSIS HEALTH CARE CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(AMOUNTS IN USD, EXCEPT SHARES)

	Three Months Ended March 31,
	2015			2014
	(Unaudited)			(Unaudited)
Cash Flows From Operating Activities
Net income	$	472,036		$	267,854
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		193,835			32,819
Interest		286,568			-
Gain on disposal of fixed assets		(12,540	)		-
Changes in operating assets and liabilities:
Accounts receivable, net		(409,272	)		(138,266	)
Inventories		(103,044	)		944
Advance to related parties		104,998			44,119
Prepayments and other current assets		(87,925	)		4,533
Accounts payable		(8,371	)		19,719
Due to related parties		(104,241	)		68,128
Deposits received		(86	)		4,085
Accrued expenses and other current liabilities		5,291			51
Net cash provided by operating activities		337,249			303,986

Cash Flows From Investing Activities
Purchases of fixed assets		(815,570	)		(260,439	)
Purchases of construction in progress		-			(179,743	)
Prepayment for fixed assets acquisition		(278,953	)		(539,229	)
Proceeds from disposal of fixed assets		45,570			-
Net cash used in investing activities		(1,048,953	)		(979,411	)

Cash Flows From Financing Activities
Proceeds from shareholders		178,048			5,725
Payments on capital lease obligation		(355,553	)		223,186
Short-term bank loans		(9,251	)		-
Payments on due to related parties		(784,454	)		-
Proceeds from finance lease		1,108,977			-
Net cash provided by financing activities		137,767			228,911

Effect of exchange rate fluctuation on cash and cash equivalents		3,941			(611	)
Net decrease in cash and cash equivalents		(569,996	)		(447,125	)

Cash and cash equivalents, beginning of period		1,046,485			631,288
Cash and cash equivalents, ending of period	$	476,489		$	184,163

Supplemental disclosure of cash flow information
Cash paid for income taxes		-			(781	)
Cash paid for interest		(286,568	)		(250,084	)

The accompanying notes are an integral part of these consolidated financial statements.

F-4

JRSIS HEALTH CARE CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(AMOUNTS IN USD)

NOTE 1. DESCRIPTION OF BUSINESS AND ORGANIZATION

JRSIS HEALTH CARE CORPORATION (the “Company” or “JHCC”) was incorporated on November 20, 2013 under the laws of the United States and the State of Florida. The general nature of the business shall be to engage in any and all lawful business permitted under the laws of the United States and the State of Florida.

JRSIS HEALTH CARE LIMITED ("JHCL"), formally named China Runteng Medical Group Co., Ltd, which is a privately held Limited Liability Company registered in British Virgin Island (“BVI”) on February 25, 2013. JHCL was authorized to issue 50,000 shares of a single class each with par value of $1.00 per share to its sole shareholder Ms. Yanhua Xing. On November 20, 2013, China Runteng Medical Group Co., Ltd has changed its name to JRSIS HEALTH CARE LIMITED ("JHCL").

Runteng Medical Group Co., Ltd (“Runteng”) is a privately held limited liability company registered in Hong Kong on September 17, 2012. Runteng was authorized to issue up to 10,000 shares with par value of HK$1 per share to its sole shareholder Ms. Yanhua Xing.

Harbin Jiarun Hospital Co., Ltd (“Jiarun”) was a privately held, for-profit hospital, incorporated in Harbin city of Heilongjiang, China in February 2006. Jiarun is a private hospital serving patients on a municipal and county level and providing both Western and Chinese medical practices to the residents of Harbin. After a series of share exchanges mentioned here after in note 1, Jiarun became a 70% owned subsidiary of the Company.

JHCC, JHCL, Runteng and Jiarun are collectively referred as the “Group”. The Group provides full health care services in the Heilongjiang region in China through Jiarun, its 70% owned subsidiary.

In accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 810, “Consolidation”, the consolidated financial statements presented herein include the accounts of JHCC, JHCL, Runteng and its 70% owned subsidiary, Jiarun.

Reorganization

On December 23, 2012, in accordance with the "Foreign Investment Enterprise Law" under the People’s Republic of China (“PRC”), Runteng and Jiarun entered into an agreement that Runteng and the original owner of Jiarun should invest a total of $7,936,508 (equivalent to RMB50,000,000), in which Runteng and the original owner should contribute $5,555,556 (equivalent to RMB35,000,000) or 70% and $2,380,952 (equivalent to RMB15,000,000) or 30% of the total capital, respectively. According to the Article of Association (Joint venture investment agreement) and the amending of Article of Association (Joint venture investment agreement), Runteng has the obligation to pay $5,555,556 (RMB35,000,000) within five years after the issuance of the joint venture business license. As of March 31, 2015, Jiarun has received $921,000 from Runteng.

On July 08, 2014, Jiarun obtained joint venture business license. Runteng has already completed “cooperation restructuring”. Up to completion of the legal structures, Jiarun are compliance with the Company Law of People’s Republic of China and all other requirements imposed by PRC authorities.

On February 25, 2013, JHCL issued 50,000 authorized shares to its sole shareholder Ms. Yanhua Xing. After the issuance, the total shares issued by JHCL were 50,000 with par value of US$1.00 per share.

On March 7, 2013, JHCL acquired all 100 issued and outstanding shares of through share exchanges to obtain 100% controlling interests of Runteng.

On June 01, 2013, Junsheng Zhang, the owner of Jiarun, entered into a supplemental agreement with Runteng for the attribution of accumulated retained earnings of Jiarun. In which, the historical accumulated profit of Jiarun up to June 30, 2013 should be 100% attributed to Junsheng Zhang; the profit generated from Jiarun after July 1, 2013 should be attributed to Runteng and Junsheng Zhang on the basis of 70% and 30%, respectively.

F-5

JRSIS HEALTH CARE CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(AMOUNTS IN USD)

NOTE 1. DESCRIPTION OF BUSINESS AND ORGANIZATION (CONTINUED)

On July 29, 2013, the Joint Venture Investment Agreement between Runteng and Junsheng Zhang has been approved by the Development and Reform Commission of Hulan District, Harbin City and Harbin Investment Promotion Bureau. On the same date, Jiarun has obtained Certificate of Approval for Establishment of Enterprises with Investment of Taiwan, Hong Kong, Macao and Overseas Chinese in the People’s Republic of China; the Joint Venture Jiarun duration of operation is twenty years.

Runteng would pay to Jiarun as soon as Runteng obtain funding from any alternatives. On July 8, 2014, Jiarun obtained joint venture business license. Runteng has already completed “cooperation restructuring”. According to the amending of Article of Association (Joint venture investment agreement), Runteng has the obligation to pay $5,555,556 (35M RMB) within five years after the issuance of the joint venture business license.

On October 3, 2013, Ms. Yanhua Xing transferred 23,275 JHCL shares to Mr. Junsheng Zhang, 23,225 JHCL shares to Ms. Chunlan Tang, and 1,050 JHCL shares to Mr. Weiguang Song.

On November 8, 2013, Ms. Chunlan Tang transferred all 23,225 JHCL shares to Mr. Junsheng Zhang, subsequently making Mr. Junsheng Zhang holdings 46,500 JHCL shares.

On December 20, 2013, a share exchange agreement was entered by and among JHCC, JHCL and the shareholders of JHCL, Junsheng Zhang, Yanhua Xing and Weiguang Song. JHCC desires to issue a total of 12,000,000 shares of its Common Stock (the “JHCC Shares”) to the Shareholders of JHCC, pro rata, in exchange for one hundred percent (100%) of the JHCL Shares owned by the Shareholders. At the Closing, the Shareholders shall allot and deliver to JHCC a total of 50,000 shares of the ordinary share of JHCL which represents one hundred percent (100%) of the issued and outstanding shares of JHCL. JHCL shall become a wholly-owned subsidiary of JHCC, and JHCC will effectively acquire all business and an assets of JHCL as now or hereafter existing, including all business and assets of any and all subsidiaries of JHCL, including Seventy percent (70%) ownership interest in Jiarun, the operating company in PRC through JHCL wholly holds subsidiary, Runteng, a Hong Kong registered investment company.

Before and after the reorganization mentioned above, Junsheng Zhang continued to serve as chairman of Jiarun (the “Operating Subsidiary”), and together with the other management of the Company, continued to direct both day-to-day operation and management of the Operating Subsidiary, as well as its strategic direction. The reorganization effectively resulted in Junsheng Zhang continuing to bear the residual risks and rewards related to the Operating Subsidiary. Because of the reasons described above, the Company is substantively controlled by Junsheng Zhang, and the Company continued to consolidate the Operating subsidiary during the reorganization. And the reorganization transactions are considered as a series of transactions between the parties under common control and did not establish a new basis in the assets and liabilities of the Operating Subsidiary.

As a result, during the reorganization, JHCC, JHCL, Runteng and Jiarun were under common control of Junsheng Zhang. Therefore, the reorganization was effectively a legal recapitalization accounted for as transactions between entities under common control at the carry over basis, in a manner similar to pooling-of-interests accounting. The effect of the reorganization was applied retroactively to the prior years’ consolidated financial statements as if the current structure existed since inception.

30% of Jiarun hospital interest held by Junsheng Zhang is subjecting to non-controlling interest (“NCIs”), which was stated under ASC810-10-45, the ownership interest in the subsidiary that are held by owners other than the parent is a non-controlling interest. 70% held by Runteng is applying to its holding Runteng. According to the supplemental agreement signed between Junsheng Zhang and Runteng on June 01, 2013, the comprehensive income from Jiarun would be attributable to retained earnings and non-controlling interest for 70% and 30% respectively, from July 1, 2013.

F-6

JRSIS HEALTH CARE CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(AMOUNTS IN USD)

NOTE 2. SUMMARIES OF SIGNIFICANT ACCOUNTING POLICIES

A.	Basis of presentation

The accompanying consolidated balance sheet as of December 31, 2014, which has been derived from audited financial statements, and the unaudited interim consolidated financial statements as of March 31, 2015 and for the three month periods ended March 31, 2015 and 2014 have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and disclosures, which are normally included in financial statements prepared in accordance with United States generally accepted accounting principles (U.S. GAAP), have been condensed or omitted pursuant to such rules and regulations, although we believe that the disclosures made are adequate to provide for fair presentation. The interim financial information should be read in conjunction with the Financial Statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014, previously filed with the SEC.

In the opinion of management, all adjustments (which include normal recurring adjustments) necessary to present a fair statement of the Company’s consolidated financial position as of March 31, 2015, its consolidated results of operations and cash flows for the three month periods ended March 31, 2015 and 2014, as applicable, have been made. The interim results of operations are not necessarily indicative of the operating results for the full fiscal year or any future periods.

B.	Principles of consolidation

The consolidated financial statements include the accounts of the Company and its subsidiaries. All significant inter-company accounts and transactions have been eliminated in consolidation. Non-controlling interests represent the equity interest in Jiarun that is not attributable to the Company. In the opinion of management, all adjustments and normal recurring accruals considered necessary for a fair statement of the results for the period have been included.

C.	Use of estimates

The preparation of unaudited consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting periods. Management makes these estimates using the best information available at the time the estimates are made; however actual results could differ from those estimates. Significant items subject to such estimates and assumptions include valuation allowances for receivables and recoverability of carrying amount and the estimated useful lives of long-lived assets. These estimates are often based on complex judgments and assumptions that management believes to be reasonable but are inherently uncertain and unpredictable. Actual results could differ from these estimates.

D.	Functional currency and foreign currency translation

An entity’s functional currency is the currency of the primary economic environment in which it operates, normally that is the currency of the environment in which the entity primarily generates and expends cash. Management’s judgment is essential to determine the functional currency by assessing various indicators, such as cash flows, sales price and market, expenses, financing and inter-company transactions and arrangements. The functional currency of the Company is the Renminbi (“RMB’), except Runteng paid in capital the Hong Kong Dollar (“HKD"). The reporting currency of these unaudited consolidated financial statements is the United States dollar (“US Dollars” or “$”).

The financial statements of the company, which are prepared using the RMB, are translated into the Company’s reporting currency, the United States Dollar. Assets and liabilities are translated using the exchange rate at each reporting period end date. Revenue and expenses are translated using weighted average rates prevailing during each reporting period, and shareholders' equity is translated at historical exchange rates. Adjustments resulting from the translation are recorded as a separate component of accumulated other comprehensive income or expense.

Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transactions. Foreign currency exchange gains and losses resulting from these transactions are included in operations.

The exchange rates used for foreign currency translation are as follows:

		2015Q1 (US$ to RMB/ US$ to HKD)		2014Q1 (US$ to RMB)
Assets and liabilities	period end exchange rate		6.1206/7.7545		6.1644
Revenue and expenses	period weighted average		6.1444/7.7556		6.1199
Capital related	historical rate		6.1921		6.1921

E.	Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk are cash, accounts receivable and other receivables arising from its normal business activities. The Company places its cash in what it believes to be credit-worthy financial institutions. The Company has a diversified customer base. The majority of sales are either cash receipt in advance or cash receipt upon delivery. For the three months ended March 31, 2015 and 2014 respectively no and no customer accounted for more than 10% of net revenue. As of March 31, 2015 and 2014 respectively 1 and 1 customer accounted for more than 5% of net accounts receivable. For those credit sales, the Company routinely assesses the financial strength of its customers and, based upon factors surrounding the credit risk, establishes an allowance, if required, for uncollectible accounts and, as a consequence, believes that its accounts receivable credit risk exposure beyond such allowance is limited.

F.	Cash and cash equivalents

Cash and cash equivalents include all cash, deposits in banks and other liquid investments with initial maturities of three months or less.

F-7

JRSIS HEALTH CARE CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(AMOUNTS IN USD)

G.	Accounts receivable

Accounts receivable are recorded at net realizable value consisting of the carrying amount less an allowance for uncollectible accounts as needed. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in the Company’s existing accounts receivable. The Company determines the allowance based on aging data, historical collection experience, customer specific facts and economic conditions. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote.

H.	Inventories

Inventories, consisting principally of medicines, are stated at the lower of cost or market using the first-in, first-out method (“FIFO”). This policy requires the Company to make estimates regarding the market value of inventory, including an assessment of excess or obsolete inventory. The Company determines excess or obsolete inventory based on an estimate of the future demand and estimated selling prices for its products.

I.	Construction in progress

Construction in progress represents the new hospital painting and decoration costs. And all direct costs relating to the polishing and decoration are capitalized as construction in progress. No depreciation is provided in respect of construction in progress.

J.	Property and equipment

Property and equipment are stated at cost. Expenditures for maintenance and repairs are charged to operations when incurred, while additions and betterments are capitalized. Depreciation is recorded on a straight-line basis reflective of the useful lives of the assets. When assets are retired or disposed, the asset’s original cost and related accumulated depreciation are eliminated from accounts and any gain or loss is reflected in income.

Buildings and improvement	10-40 years
Medical equipment	5-15 years
Transportation instrument	5-10 years
Office equipment	5-10 years
Electronic equipment	5-10 years
Software	5-10 years

Leases

Operating lease

Leases where substantially all the rewards and risks of ownership of assets remain with the lessor are accounted for as operating leases. Minimum lease payments, including scheduled rent increases, made under operating leases are charged to the consolidated statements of operations and other comprehensive income (loss) on a straight-line basis over the lease term. Contingent rentals are excluded from minimum lease payments, and are recognized as expense when the achievement of the specified target is considered probable.

Capital lease

When the lease term is equal to 75 percent or more of the estimated economic life of the leased property, the lease is classified as a capital lease, where the lessee assumes substantially all the benefits and risks of ownership. The depreciation is calculated on a straight-line basis over the estimated useful lives of leased property.

In a capital lease, assets and liabilities are recorded at the amount of the lesser of (a) the fair value of the leased asset at the inception of the lease or (b) the present value of the minimum lease payments (excluding executing costs) over the lease term. Recorded assets are depreciated over their estimated useful lives. During the lease term, each minimum lease payment is allocated between a reduction of the obligation and interest expense to produce a constant periodic rate of interest on the remaining balance of the obligation.

F-8

JRSIS HEALTH CARE CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(AMOUNTS IN USD)

L.	Fair Value Measurement

The Company applies the provisions of ASC Subtopic 820-10, Fair Value Measurements, for fair value measurements of financial assets and financial liabilities and for fair value measurements of nonfinancial items that are recognized or disclosed at fair value in the financial statements. ASC 820 also establishes a framework for measuring fair value and expands disclosures about fair value measurements.

Fair value is defined as the price that would be received when selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In determining the fair value for the assets and liabilities required or permitted to be recorded, the Company considers the principal or most advantageous market in which it would transact and it considers assumptions that market participants would use when pricing the asset or liability.

ASC 820 establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes three levels of inputs that may be used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to measurements involving significant unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows:

Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;

Level 2: Quoted prices in markets that are not active, or inputs that is observable, either directly or indirectly, for substantially the full term of the asset or liability;

Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity).

There were no transfers between level 1, level 2 or level 3 measurements for the three months ended March 31, 2015 and 2014.

Cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities are reflected in the accompanying consolidated financial statements at amounts that approximate fair value because of the short-term nature of these instruments. The fair value of the Company’s capital lease obligations also approximate carrying value as they bear interest at current market rates.

M.	Segment and geographic information

The Company is operating in one segment in accordance with the accounting guidance FASB ASC topic 280, “Segment Reporting”. The company’s revenues are from customers in People’s Republic of China (“PRC”). All assets of the company are located in PRC.

N.	Revenue recognition

The Company recognizes revenue when the amount of revenue can be reliably measured, it is probable that economic benefits will flow to the entity and specific criteria have been met for each of the Company’s activities as described below.

Medicine sales

Revenue from the sale of medicine is recognized when it is both earned and realized. The Company’s policy is to recognize the sale of medicine when the title of the medicine, ownership and risk of loss have transferred to the purchasers, and collection of the sales proceeds is reasonably assured, all of which generally occur when the patient receives the medicine.

Given the nature of this revenue source of the Company’s business and the applicable rules guiding revenue recognition, the revenue recognition practices for the sale of medicine do not contain estimates that materially affect results of operations nor any policy for return of products.

Patient Services

In accordance with the medical licenses of Jiarun, the approved medical patient service scope of the Company include medical consulting, surgery, obstetrics and gynecology, pediatrics, anesthesia, clinic laboratory, medical imaging, and traditional Chinese medicine, etc.

F-9

JRSIS HEALTH CARE CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(AMOUNTS IN USD)

N.	Revenue recognition (continued)

Patient service revenue is recognized when it is both earned and realized. The Company’s policy is to recognize patient service revenue when the medical service has been provided to the patient and collection of the revenue is reasonably assured.

The Company provides services to both patients covered by social insurance and patients who are not covered by social insurance. The Company charges the same rates for patient services regardless of the coverage by social insurance.

Patients who are not covered by social insurance are liable for the total cost of medical treatment.

For out-patient medical services, revenue is recognized when the Company provides medical service to the patient. The Company collects payment when the patient checks out from the hospital, which is the same day the services are provided.

For in-patient medical services, the Company estimates the approximate fee the patients will spend in the hospital based on patients’ symptom. This is when the patients check in to the hospital. At that time, the Company collects the estimated fees from the patient and records the payment as deposits received.

During the in-patient services period, the Company recognizes revenue when the patient service is provided and deducts the cost of service from the deposit received. The Company records these transactions based on daily reports generated by the respective medical department. When medical services exceed patient deposits received the Company records revenue and accounts receivable when the patient services are provided.

When patients check out from the hospital, the Company calculates and determines the remaining deposit, if any, and refunds the unused portion of the deposit to the patients. In the case where the patients have a balance in accounts receivable during the in-patient period, accounts receivable are required to be paid in full at checkout.

Patients covered by social insurance will receive a portion or full medical services reimbursed or paid by the social insurance agencies via prepaid cards or insurance claim settlement process.

Settlement process

The Company is a registered medical service vendor under the state social insurance system for various social insurance agencies; the insurance agencies include “Social Medical Insurance funded by PRC and Heilongjiang Province” and “Heilongjiang Province New Rural Cooperative Medical Care System”. The Company utilizes an online system maintained by the social insurance agencies for patients’ who are covered by social insurance agencies.

The Company records patients’ information in the social insurance system at check in. The system determines the covered portion and amounts based on the information input to the system.

At the time of check out, the Company collects payment for services the patients are liable for and records accounts receivable from the social insurance agencies for the portion of services covered by the social insurances. In the case that the patients have made payment during the in-patient services period, the Company refunds any amount in excess of the portion they are liable for.

The Company is responsible for submitting supporting documents of patient services provided to the social insurance agencies for their review. The Company also requires reconciling its records with the social insurance agencies once a month. Once the social insurance agencies approve the reconciliation, the insurance agencies will settle the accounts receivable balance in the next month following the approval.

F-10

JRSIS HEALTH CARE CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(AMOUNTS IN USD)

O.	Income taxes

The Company adopts FASB ASC Topic 740, “Income Taxes,” which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

In July 2006, the FASB issued FIN 48(ASC 740-10), Accounting for Uncertainty in Income Taxes-An Interpretation of FASB Statement No. 109 (ASC 740), which requires income tax positions to meet a more-likely-than-not recognition threshold to be recognized in the financial statements. Under FIN 48(ASC 740-10), tax positions that previously failed to meet the more-likely-than-not threshold should be recognized in the first subsequent financial reporting period in which that threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not threshold should be derecognized in the first subsequent financial reporting period in which that threshold is no longer met.

The application of tax laws and regulations is subject to legal and factual interpretation, judgment and uncertainty. Tax laws and regulations themselves are subject to change as a result of changes in fiscal policy, changes in legislation, the evolution of regulations and court rulings. Therefore, the actual liability may be materially different from our estimates, which could result in the need to record additional tax liabilities or potentially reverse previously recorded tax liabilities or deferred tax asset valuation allowance.

As a result of the implementation of FIN 48 (ASC 740-10), the company made a comprehensive review of its portfolio of tax positions in accordance with recognition standards established by FIN 48 (ASC 740-10). The Company recognized no material adjustments to liabilities or shareholder’s equity as a result of the implementation. The adoption of FIN 48 did not have a material impact on the Company’s unaudited consolidated financial statements.

Enterprise income tax is defined under the Provisional Regulations of PRC Concerning Income Tax on Enterprises promulgated by the PRC, income tax is payable by enterprises at a rate of 25% of their taxable income.

Jiarun's medical services have been exempt from enterprise income tax since March 1, 2006, which has been approved by the Local Taxation Bureau.

Jiarun was incorporated in accordance with the law of medical and health institutions, mainly provide medical services, with the "PRC Business Tax Tentative Regulations" Article 8 (3) medical service income tax-free provisions (hospital, clinics and other medical institutions to provide medical services shall be exempt from business tax). The Company's medical services have been exempted from business tax since March 1, 2006.

In considering the achievement of the hospital, it could not have been done without the support of local authorities, Jiarun hospital has voluntarily paid income tax of $Nil and $781 for the three months ended March 31, 2015 and 2014, respectively to support the local tax bureau's economical obligations.

P.	Earnings per share

Basic earnings per common share is computed by using net income divided by the weighted average number of shares of common stock outstanding for the periods presented. Diluted earnings per share is computed by dividing net income by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding for the periods presented.

Q.	Recently accounting pronouncements

From time to time, new accounting standards issued by the Financial Accounting Standards Board (“FASB”) are adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on its financial position or results of operations upon adoption.

F-11

JRSIS HEALTH CARE CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(AMOUNTS IN USD)

NOTE 3. Accounts Receivable, Net

	March 31		December 31
	2015		2014
	(Unaudited)
Accounts receivable	$	1,103,452	$	688,885
Less: allowance for doubtful debts		27,367		27,220
	$	1,076,085	$	661,665

The Company experienced nil bad debts during three months ended March 31, 2015 and 2014.

NOTE 4. Inventories

At March 31, 2015 and December 31, 2014, inventories consist of the following:

	March 31		December 31
	2015		2014
	(Unaudited)
Western medicine	$	222,113	$	174,907
Chinese herbal medicine		5,863		5,723
Medical material		57,070		-
	$	285,046	$	180,630

NOTE 5. Prepayment

At March 31, 2015 and December 31, 2014, prepayment consists of the following:

	March 31		December 31
	2015		2014
	(Unaudited)
Deposits on medical equipment	$	903,015	$	662,631
Heating fees		50,484		-
Others		4,289		29,171
	$	957,788	$	691,802

NOTE 6. Property and Equipment

At March 31, 2015 and December 31, 2014, property and equipment, at cost, consist of:

	March 31,		December 31,
	2015		2014
	(Unaudited)
Transportation equipment	$	375,758	$	309,099
Medical equipment		4,721,784		4,003,566
Electrical equipment		681,268		677,626
Office equipment and other		89,323		6,234
Buildings		15,865,791		15,780,963
Software		87,571		87,103
Total fixed assets at cost		21,821,495		20,864,591
Accumulated depreciation		683,941		532,727
Total fixed assets, net	$	21,137,554	$	20,331,864

Depreciation expense was $193,835 and $32,819 for the three months ended March 31, 2015 and 2014, respectively.

F-12

JRSIS HEALTH CARE CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(AMOUNTS IN USD)

NOTE 7. Capital Lease Obligations and Deposit for Capital Leases

On September 1, 2014, Jiarun entered into a Lease Agreement to lease medical equipment from Concham Global Finance Leasing, a third party, for a three-year period, in which Jiarun is required to make monthly payments toward the lease. The Company was also required to pay a deposit up front, which deposit will later be used to offset against the last quarterly payment. The medical equipment will be transferred to Jiarun upon the completion of the Agreement.

On October 22, 2014, Jiarun entered into a Lease Agreement to lease medical equipment and elevator from Yuandong International Leasing Company, a third party, for a three-year period, in which Jiarun is required to make monthly payments toward the lease. The Company also was required to pay a deposit up front, which deposit will be later used to offset against the last quarterly payment. The medical equipment will be transferred to Jiarun upon the completion of the Agreement.

On June 5, 2013, Jiarun entered into a Lease Agreement to lease hospital building from Harbin Baiyi Real Estate Development Co., Ltd, which is owned by Junsheng Zhang, a related party. The Leasing terms consist of principal plus 30 payments. Each payments will be made on an annual basis when 7 million RMB per payment will be paid upfront for each leasing period. The first payment was made on September 1st, 2014. At the end of the leasing period, a final payment will be made to settle the total leasing amount. Both parties agreed for the leasee to pay 3 million RMB as deposit at the execution of the Leasing agreement, which will be deducted from the final rental settlement. The lending interest rate was calculated at 6.55%, which is the benchmark interest rate announced from The People’s Bank of China. After the completion of all payments, the ownership of the lease item will be transferred to the Leasee (Jiarun hospital).

According to the Financial Leasing Contract, Jiarun has committed CNY 3 million ($490,677) of premium for lease which shall be paid in full prior to commencement of the leasing period to the Leasor. In accordance to accounting principles and treatment, this payment was booked as deposit in our accounts. The Leasor shall return the premium for lease to the Leasee at expiration of this Contract, or pledge this deposit as part of rents for the last period or periods in 2043.

The leasing agreement for our hospital building contains the following provisions:

•

Rental payments of $1,144,913 per year, payable at the beginning of the month, September 2014.

•

An option allowing the lessor to extend the lease for thirty years beyond the last renewal option exercised by the company

•

A guarantee by the company that the lessor will realize $Nil, from selling the asset at the expiration of the lease This lease is a capital lease because its term (30 years) exceeds 75% of the building’s estimated economic life. In addition, the present value ($15,185,032) of the minimum lease payments exceeds 90% of the fair value of the building ($15,721,295).

•

Accumulated annual amounts resulting from applying an interesting rate 6.55% to the balance of the lease obligation at the beginning of each year. The lease obligation is increased by the amount of the prior year’s interest, the amount of the net rental payment at the beginning of each year; and this amount represents the guaranteed residual value at the end of the lease term.

These leases have been classified as capital leases. The cost of the medical equipment included in these leases is included in the consolidated balance sheets as property and equipment and construction in progress.

The future minimum lease payments for annual capital lease obligation as of March 31, 2015 are as follows:

Year	Amounts
2015	$	1,166,640
2016		1,831,378
2017		1,713,406
Thereafter		13,287,222
Total	$	17,998,646

The Company recorded finance lease fees of $275,955 and $249,496 for the three months ended March 31, 2015 and 2014, respectively.

F-13

JRSIS HEALTH CARE CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(AMOUNTS IN USD)

NOTE 8. Short-term Bank Loans

	March 31		December 31
	2015		2014
	(Unaudited)
Short- term bank loans	$	473,810	$	471,277

As of March 31, 2015, the above bank loans were for working capital and capital expenditure purposes. The loans were primarily obtained from Harbin Bank with interest rate of 7.84% per annum, from December 2, 2014 to December 1, 2015. The interest expenses were $9,288 and nil for the three months ended March 31, 2015 and 2014, respectively.

NOTE 9. Non-controlling Interests

Non-controlling interests represent the portion of equity in a subsidiary not attributable, directly or indirectly, to a parent. The Company’s accompanying consolidated financial statements include all assets, liabilities, revenues and expenses at their consolidated amounts, which include the amounts attributable to the Company and the non-controlling interest. The Company recognizes as a separate component of equity and earnings the portion of income or loss attributable to non-controlling interests based on the portion of the entity not owned by the Company.

The Company adopted the provisions of FASB authoritative guidance regarding non-controlling interests in consolidated financial statements. The guidance requires the Company to clearly identify and present ownership interests in subsidiaries held by parties other than the Company in the consolidated financial statements within the equity section. It also requires the amounts of consolidated net earnings attributable to the Company and to the non-controlling interests to be clearly identified and presented on the face of the consolidated statements of operations.

On June 1, 2013, Junsheng Zhang, the owner of Jiarun Hospital, entered into a supplemental agreement with Runteng for the attribution of accumulated retained earnings of Jiarun. In which, the retained earnings of Jiarun will be 100% attributed to Junsheng Zhang up to June 30, 2013. From July 1, 2013, the income of operations from Jiarun will be attributed to Runteng and Junsheng Zhang for 70% and 30% respectively.

On June 3, 2013, Jiarun Hospital received paid in capital of $702,508 (RMB4.35 Million) in cash from Mr. Junsheng Zhang, which has been certified by Heilongjiang Jinyuda Accountants Business Office Co. Ltd; the report number is (2013) A436.

$702,508 are reflected under “Cash and cash equivalents” of the caption in the consolidated balance sheets.

According to the regulation of the State Administration for Industry & Commerce of the People’s Republic of China and the shareholder investment confirmation letter signed on July 25, 2014 confirmed by both parties (Runteng Group and Junsheng Zhang), total contribution amount of Junsheng Zhang has been completed before the merger and acquisition of Runteng Group to Jiarun Hospital on June 30, 2013. Thus, Junsheng Zhang has already fulfilled his “cooperation restructuring” obligation. Both parties have confirmed Junsheng Zhang has completed his investment, no further obligations to be fulfilled by Junsheng Zhang.

On July 8, 2014, Jiarun have obtained joint venture business license. The Company has already completed “cooperation restructuring”. According to the amending of Article of Association (Joint venture investment agreement), Runteng has the obligation to pay $5,555,556 (35m RMB) within five years after the issuance of the joint venture business license. However, no interest is required to be paid. However, no interest is required to be paid. Up to completion of the Company’s legal structures, we are compliance with the Company Law of People’s Republic of China and all other requirements imposed by PRC authorities.

On June 1, 2013, Junsheng Zhang, the owner of Jiarun Hospital, entered into supplemental agreement with Runteng for the attribution of accumulated retained earnings of Jiarun. In which, the retained earnings of Jiarun will be attributed to Junsheng Zhang up to June 30, 2013. From July 1, 2013, the income of operations from Jiarun will be attributed to Runteng and Junsheng Zhang for 70% and 30% respectively.

According to the joint venture supplemental agreement, the comprehensive income of Jiarun will be attributable to the non-controlling interest up to June 30, 2013. From July 1, 2013, the comprehensive income from Jiarun will be attributable to retained earnings and non-controlling interest for 70% and 30% respectively.

F-14

JRSIS HEALTH CARE CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(AMOUNTS IN USD)

NOTE 9. Non-controlling Interests (continued)

Based on the Company’s analysis of the guidance contained in FASB ASC 805-50-15 a., an example of transactions between entities under common control includes an entity that “charters” a newly formed entity and then transfers some or all of its net assets to that newly formed entity. In this situation, the Predecessor’s management (Jiarun) created the JHCC, and operating with the approval and at the direction of JHCC. For the purpose of contributing the net assets in the Predecessor, in exchange for equity in the JHCC.

On 20th of December 2013, by and among JRSIS HEALTH CARE CORPORATION (the “JHCC”) and JRSIS HEALTH CARE LIMITED (the “JHCL”) and the shareholders of JHCL, Junsheng Zhang, Yanhua Xing and Weiguang Song has entered a share exchange agreement. JHCC desires to issue a total of 12,000,000 shares of its Common Stock (the “JHCC Shares”) to the Shareholders of JHCC, pro rata, in exchange for one hundred percent (100%) of the JHCL Shares owned by the Shareholders. At the Closing, the Shareholders shall allot and deliver to JHCC a total of 50,000 shares of the ordinary share of JHCL which represents one hundred percent (100%) of the issued and outstanding shares of JHCL. JHCL shall become a wholly-owned subsidiary of JHCC, and JHCC will effectively acquire all business and an assets of JHCL as now or hereafter existing, including all business and assets of any and all subsidiaries of JHCL., including Runteng Medical Group Company Limited, a Hong Kong registered investment company that holds a seventy percent (70%) ownership interest in Harbin Jiarun Hospital Company Ltd., a Heilongjiang registered company. The Company will account for the December 2013 exchange transaction in accordance with standards promulgated by the FASB regarding transactions between entities under common control, ASC 805-50-15.

JHCC as a parent company is subjecting ASC810-10-10, which states that consolidated financial statements are required for a fair presentation if one of the entities in the consolidated group directly or indirectly has a controlling financial interest in the other entities.

30% of Jiarun hospital interest held by Junsheng Zhang is subjecting to non-controlling interest (“NCI”), which was stated under ASC810-10-45, the ownership interest in the subsidiary that are held by owners other than the parent is a non-controlling interest. On the other hand, 82% held by Junsheng Zhang is applying to our parent company JHCC.

As of March 31, 2015 and December 31, 2014, NCI in the consolidated balance sheet was $3,153,387 and $2,996,434, respectively. For the three months ended Mach 31, 2015, the comprehensive income attributable to shareholders’ equity and NCI is $346,178 and $156,953 respectively. For the three months ended March 31, 2014, the comprehensive income attributable to shareholders’ equity and NCIs is $149,765 and $90,869, respectively.

NOTE 10. Revenue

The Company’s revenue consists of medicine sales and patient care revenue.

	Three Months Ended March 31,
	2015		2014
	(Unaudited)		(Unaudited)
Medicine:
Western medicine	$	904,102	$	674,393
Chinese medicine		198,232		88,451
Herbal medicine		33,512		19,598
Total medicine	$	1,135,846	$	782,442

Patient services:
Medical consulting	$	633,876	$	301,484
Medical treatment		653,473		445,267
Others		4,527		397
Total patient services	$	1,291,876	$	747,148

	$	2,427,722	$	1,529,590

F-15

JRSIS HEALTH CARE CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(AMOUNTS IN USD)

NOTE 11. Income Tax Expense

The Company uses the asset-liability method of accounting for income taxes prescribed by ASC 740 Income Taxes. The Company and its subsidiaries each files their taxes individually.

United States

JHCC is subject to the United States of America Tax law at tax rate of 34%. No provision for the US federal income taxes has been made as the Company had no US taxable income for the periods presented, and its earnings are permanently invested in PRC.

BVI

JHCL was incorporated in the BVI and, under the current laws of the BVI, it is not subject to income tax.

Hong Kong

Runteng was incorporated in Hong Kong and is subject to Hong Kong profits tax. Runteng is subject to Hong Kong taxation on its activities conducted in Hong Kong and income arising in or derived from Hong Kong. The applicable statutory tax rate is 16.5%.

PRC

Jiarun's medical services have been exempt from enterprise income tax since March 1, 2006, which has been approved by the Local Taxation Bureau.

F-16

JRSIS HEALTH CARE CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(AMOUNTS IN USD)

NOTE 12. Related Party Transactions

A party is considered to be related to the Company if the party directly or indirectly or through one or more intermediaries, controls, is controlled by, or is under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. A party which can significantly influence the management or operating policies of the transacting parties or if it has an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests is also a related party.

As of March 31, 2015 and December 31, 2014, the Company has an accounts payable balance due to Heilongjiang Dahua Medicine Wholesale Co., Ltd owned by Junsheng Zhang, for the amount of $102,885 and $94,680, respectively.

During the three months ended March 31, 2015 and 2014, the Company purchased from Heilongjiang Dahua Medicine Wholesale Co., Ltd for $105,741 and $77,760 respectively.

During the three months ended March 31, 2015 and 2014, the Company had borrowed from Dahua Medicine Wholesale Co., Ltd for $29,409 and $Nil, respectively.

As of March 31, 2015 and December 31, 2014, the Company has a balance due to Harbin Jiarun Pharmacy Co., Limited owned by Junsheng Zhang, of $ Nil and $86,812, respectively.

During the three months ended March 31, 2015 and 2014, the Company purchased from Harbin Jiarun Pharmacy Co., Limited for $70,240 and $63,931, respectively.

As of March 31, 2015 and December 31, 2014, the Company has a balance due to Heilongjiang Province Runjia Medical Equipment Company Limited owned by Junsheng Zhang of $11,455 and $107,987, respectively.

During the three months ended March 31, 2015 and 2014, the Company had purchased from Heilongjiang Province Runjia Medical Equipment Company Limited for $25,326 and $18,153, respectively.

As of March 31, 2015 and December 31, 2014, the Company has a balance due to Jiarun Super Market Co., Ltd owned by Junsheng Zhang of $187,890 and $877,549.

As of March 31, 2015 and December31, 2014, the Company has a balance due to Harbin Qi-run pharmacy limited owned by Junsheng Zhang of $18,341 and $130,007.

During the three months ended March 31, 2015 and 2014, the Company had purchased from Harbin Qi-run pharmacy limited for $18,341 and $Nil, respectively.

As of March 31, 2015 and December 31, 2014, the Company has an accounts payable balance due to Hulan Ankang Pharmacy owned by Junsheng Zhang, for the amount of $114,368 and $Nil, respectively.

During the three months ended March 31, 2015 and 2014, the Company had borrowed from Hulan Ankang Pharmacy for $114,368 and $Nil, respectively.

The Company has a total balance due to related parties of $434,939 and $1,297,036 as of March 31, 2015 and December 31, 2014, respectively.

As of March 31, 2015 and December 31, 2014, the Company has a balance due to Junsheng Zhang for the amount of $5,162 and $3,162.

As of March 31, 2015 and 2014, the shareholder of JHCL owed the company $50,000 and $50,000 for paid-in capital respectively.

On June 5, 2013, Jiarun entered into a Lease Agreement to lease new hospital building from Harbin Baiyi Real Estate Development Co., Ltd, which is owned by Junsheng Zhang, a related party. As of March 31, 2015 and December 31, 2014, Harbin Baiyi Real Estate Development Co., Ltd received decoration fee paid in advance from the Company in the total amount of $30,713 and $135,391, respectively. As of March 31, 2015 and December 31, 2014, the company has balance of deposits for capital leases of $490,148 and $487,527 respectively. As of March 31, 2015 and December 31, 2014, the company has balance of Capital lease obligations of $15,248,522 and $14,927,776 respectively.

F-17

JRSIS HEALTH CARE CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(AMOUNTS IN USD)

NOTE 13. Basic and Diluted Earnings Per Share

Basic net income per share is computed using the weighted average number of common shares outstanding during the period. Diluted net income per share is computed using the weighted average number of common shares and, if dilutive, potential common shares outstanding during the period. Potential common shares comprise shares issuable upon the exercise of share based awards, using the treasury stock method. The reconciliation of the numerators and denominators of the basic and diluted earnings per share computations for income from continuing operations is shown as follows:

	Three Months Ended March 31,
	2015		2014
	(Unaudited)		(Unaudited)
Numerator:
Net income available to common stockholders	$	324,038	$	168,440
Denominator:
Basic weighted-average number of shares outstanding		13,659,289		13,200,578
Effect of dilutive warrants		-		-
Diluted weighted-average number of shares outstanding		13,659,289		13,200,578
Net income per share:
Basic	$	0.0237	$	0.0128
Diluted	$	0.0237	$	0.0128

NOTE 14. Contingencies and Commitment

Certain conditions may exist as of the date the consolidated financial statements are issued, which may result in a loss to the Company but which will only be resolved when one or more future events occur or fail to occur. The Company’s management and legal counsel assess such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Company’s legal counsel evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought. There was no contingency of this type as of March 31, 2015 and December 31, 2014.

If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates that a potential material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material would be disclosed. There was no contingency of this type as of March 31, 2015 and December 31, 2014.

Loss contingencies considered to be remote by management are generally not disclosed unless they involve guarantees, in which case the guarantee would be disclosed.

NOTE 15. Subsequent Events

The Management of the Company determined that there were no other reportable subsequent events to be disclosed.

F-18

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

The following discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements and the notes thereto included elsewhere in this Quarterly Report on Form 10-Q, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of such financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. On an ongoing basis, we evaluate these estimates, including those related to useful lives of real estate assets, bad debts, impairment, contingencies and litigation. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. There can be no assurance that actual results will not differ from those estimates. The analysis set forth below is provided pursuant to applicable SEC regulations and is not intended to serve as a basis for projections of future events. See “Cautionary Statement Regarding Forward Looking Statements” above.

Overview

Harbin Jiarun Hospital Company Limited (“Jiarun Hospital”) was established in Harbin in the Province of Heilongjiang of the People’s Republic of China (“PRC”) by the owner Junsheng Zhang on February 17, 2006

Jiarun is a private hospital serving patients on a municipal and county level and providing both Western and Chinese medical practices to the residents of Harbin. Jiarun specializes in the areas of Pediatrics, Dermatology, ENT, Traditional Chinese Medicine (TCM), Ophthalmology, Internal Medicine Dentistry, General Surgery, Rehabilitation Science, Gynecology, General Medical Services, etc.

On November 20, 2013, Junsheng Zhang, the officer of Jiarun Hospital established JRSIS HEALTH CARE CORPORATION, a Florida corporation (“JHCC” or the “Company”). On February 25, 2013, the officer of Jiarun Hospital established JRSIS HEALTH CARE LIMITED ("JHCL"), a wholly owned subsidiary of the Company, and On September 17, 2012, the officer of Jiarun Hospital established Runteng Medical Group Co., Ltd (“Runteng”), a wholly owned subsidiary of JHCL. Runteng, a Hong Kong registered Investment Company, holds a seventy percent (70%) ownership interest in Harbin Jiarun Hospital Company Ltd, a Heilongjiang registered company.

On December 20, 2013, the Company acquired One Hundred Percent (100%) of the issued and outstanding capital stock of JRSIS Health Care Limited, a privately held Limited Liability Company registered in the British Virgin Islands (“JHCL”) for Twelve Million (12,000,000) shares of our common stock. JHCL, through its wholly owned subsidiary, Runteng Medical Group Co., Ltd (“Runteng”), holds majority ownership in Harbin Jiarun Hospital Co., Ltd, a company duly incorporated, organized and validly existing under the laws of China (“Jiarun”). As the parent company, JHCC rely on Jiarun Hospital to conduct One Hundred Percent (100%) of our businesses and operations.

We have two sources of patient revenues: in-patient service revenues and out-patient service revenues. In addition to provide services to our patients, we also sell pharmaceutical medicines to our patients. Revenues from such sales are included in either our in-patient service revenues or our out-patient service revenues. Our revenues come from individuals as well as third-party payers, including PRC government programs and insurance providers, under which the hospital is paid based upon local government established charges. Revenue from the sale of medicine is recognized when it is both earned and realized. The Company’s policy is to recognize the sale of medicine when the title of the medicine, ownership and risk of loss have transferred to the purchasers, and collection of the sales proceeds is reasonably assured, all of which generally occur when the patient receives the medicine. Patient service revenue is recognized when it is both earned and realized. The Company’s policy is to recognize patient service revenue when the medical service has been provided to the patient and collection of the revenue is reasonably assured.

Plan of Operation

Over the next twelve months, we will concentrate on the following four areas to grow our operations:

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Capital and Funding – Seek to obtain capital from all available sources to complete our hospital expansion and acquisition targets.

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Advertising and Marketing – Work with several marketing companies to develop brand identity, marketing materials, and update our web site. Utilize all available marketing venues and public relations opportunities to promote the Company and its medicine and services. In April, 2014, we also bought a mobile clinic to provide free health examinations in the hospital area. Management believes this free service will bring us much higher brand reputation and potential customers locally.

Critical Accounting Policies and Management Estimates

Our discussion and analysis of our financial condition and results of operations relates to our consolidated financial statements, which have been prepared in accordance with the United States generally accepted accounting principles ("U.S. GAAP").The consolidated financial statements include the accounts of the Company and its subsidiaries. All significant inter-company accounts and transactions have been eliminated in consolidation.

Principles of consolidation

The consolidated financial statements include the accounts of the Company and its subsidiaries. All significant inter-company accounts and transactions have been eliminated in consolidation.

Use of estimates

Revenue Recognition

Medicine sales

Revenue from the sale of medicine is recognized when it is both earned and realized. The Company's policy is to recognize the sale of medicine when the title of the medicine, ownership and risk of loss have transferred to the purchasers, and collection of the sales proceeds is reasonably assured, all of which generally occur when the patient receives the medicine.

Given the nature of this revenue source of the Company's business and the applicable rules guiding revenue recognition, the revenue recognition practices for the sale of medicine do not contain estimates that materially affect results of operations nor any policy for return of products.

Patient Services

Patient service revenue is recognized when it is both earned and realized. The Company's policy is to recognize patient service revenue when the medical service has been provided to the patient and collection of the revenue is reasonably assured.

Patients who are not covered by social insurance are liable for the total cost of medical treatment.

For in-patient medical services, the Company estimates the approximate fee the patients will spend in the hospital based on patients' symptom. This is when the patients check in to the hospital. At that time, the Company collects the estimated fees from the patient and records the payment as deposits received.

Patients covered by social insurance will receive a portion or full medical services reimbursed or paid by the social insurance agencies via prepaid cards or insurance claim settlement process.

Settlement process

The Company records patients’ information in the social insurance system at check in. The system determines the covered portion and amounts based on the information input to the system.

Income Taxes and Uncertain Tax Positions

The Company adopts FASB ASC Topic 740, "Income Taxes," which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

As a result of the implementation of FIN 48 (ASC 740-10), the company made a comprehensive review of its portfolio of tax positions in accordance with recognition standards established by FIN 48 (ASC 740-10). The Company recognized no material adjustments to liabilities or shareholder's equity as a result of the implementation. The adoption of FIN 48 did not have a material impact on the Company's unaudited consolidated financial statements.

Jiarun's medical services have been exempt from enterprise income tax since March 1, 2006, which has been approved by the Local Taxation Bureau.

Accounts Receivable

Accounts receivable are recorded at net realizable value consisting of the carrying amount less an allowance for uncollectible accounts as needed. The allowance for doubtful accounts is the Company's best estimate of the amount of probable credit losses in the Company's existing accounts receivable. The Company determines the allowance based on aging data, historical collection experience, customer specific facts and economic conditions. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote

Property and equipment

Property and equipment are stated at cost. Expenditures for maintenance and repairs are charged to operations when incurred, while additions and betterments are capitalized. Depreciation is recorded on a straight-line basis reflective of the useful lives of the assets. When assets are retired or disposed, the asset's original cost and related accumulated depreciation are eliminated from accounts and any gain or loss is reflected in income.

Buildings and improvement			10-40 years
Medical equipment			5-15 years
Transportation instrument			5-10 years
Office equipment			5-10 years
Electronic equipment			5-10 years
Software			5-10 years

Foreign currency transactions and translations

An entity's functional currency is the currency of the primary economic environment in which it operates, normally that is the currency of the environment in which the entity primarily generates and expends cash. Management's judgment is essential to determine the functional currency by assessing various indicators, such as cash flows, sales price and market, expenses, financing and inter-company transactions and arrangements. The functional currency of the Company is the Renminbi ("RMB'), except Runteng paid in capital the Hong Kong Dollar ("HKD"). The reporting currency of these unaudited consolidated financial statements is the United States dollar ("US Dollars" or "$").

The financial statements of the company, which are prepared using the RMB, are translated into the Company's reporting currency, the United States Dollar. Assets and liabilities are translated using the exchange rate at each reporting period end date. Revenue and expenses are translated using weighted average rates prevailing during each reporting period, and shareholders' equity is translated at historical exchange rates. Adjustments resulting from the translation are recorded as a separate component of accumulated other comprehensive income or expense.

The exchange rates used for foreign currency translation are as follows:

		2015Q1 (US$ to RMB/ US$ to HKD)		2014Q1 (US$ to RMB)
Assets and liabilities	period end exchange rate		6.1206/7.7545		6.1644
Revenue and expenses	period weighted average		6.1444/7.7556		6.1199
Capital related	historical rate		6.1921		6.1921

Results of Operations for the three months Ended March 31, 2015 and 2014

The following table shows key components of the results of operations during three months ended March 31, 2015 and 2014:

	Three Months Ended March 31,					Change
	2015		2014			$			%
Revenue:
Medicine	$	1,135,846	$	782,442		$	353,404			45	%
Patient services		1,291,876		747,148			544,728			73	%
Total revenue		2,427,722		1,529,590			898,132			59	%
Operating costs and expenses:
Cost of medicine sold		709,801		464,415			245,386			53	%
Medical consumables		145,595		97,518			48,077			49	%
Salaries and benefits		380,649		261,300			119,349			46	%
Office supplies		31,766		19,562			12,204			62	%
Vehicle expenses		7,031		13,348			(6,047	)		(45	)%
Utilities expenses		191,648		24,118			167,530			695	%
Rentals and leases		-		42,321			(42,321	)		(100	)%
Advertising and promotion expenses		-		1,942			(1,942	)		(100	)%
Interest expense		289,169		250,834			38,335			15	%
Professional fee		18,462		62,746			(44,284	)		(71	)%
Depreciation		193,835		32,819			161,016			491	%
Total operating costs and expenses		1,968,226		1,270,923			697,303			55	%
Earnings from operations before other income and income taxes		459,496		258,667			200,829			78	%
Other (loss) income		12,540		9,968			2,572			26	%
Earnings from operations before income taxes		472,036		268,635			203,401			76	%
Income tax		-		781			(781	)		(100	)%
Net income		472,036		267,854			204,182			76	%

Other comprehensive income:
Foreign currency translation adjustment		31,095		(27,220	)		58,316			(214	)%
Comprehensive income	$	503,131	$	240,634		$	262,498			109	%

Revenue

Operating revenue for the three months ended March 31, 2015, which resulted primarily from medicine revenue and patient services revenue, was $2,427,722 an increase of 59% as compared with the operating revenue of $1,529,590 for the three months ended March 31, 2014. The increase was primarily a result of the number of treated inpatients growing to 2.93 thousand patients, 1.42 thousand more than the 1.51 thousand patients treated in three months ended March 31, 2014.

Costs and Expenses

Total costs and expenses were $1,968,226 for the three months ended March 31, 2015, an increase of $697,303 or 55% as compared to $1,270,923 for the same period of 2014. This increase was primarily due to significant increases in salaries and benefits of $119,349, and increases in cost of medicine supplies of approximately $245,386, and increase in medical consumables of $48,077 and utilities expenses of $167,530.

Cost of medicine sold

Cost of medicine sold mainly consists of cost of Western medicine, Chinese medicine and herbal medicine. Total cost of medicine sold was $709,801 for the three months ended March 31, 2015, an increase of $245,386 or 53% as compared to $464,415 for the same period of 2014.

Medical consumables

Medical consumables mainly consist of materials expenses, medical film expenses and test reagent. Total medical consumables were $145,595 for the three months ended March 31, 2015, an increase of $48,077 or 49% as compared to $97,518 for the same period of 2014.The increase was mainly a result of increase in materials expenses of $29,719 and increase in medical film expenses of $7,251, and increase in test reagent expense of $16,869.

Salaries and benefits

Salaries and benefits mainly consist of salaries expenses, and social insurance expenses. Total salaries and benefits were $380,649 for the three months ended March 31, 2015, an increase of $119,349 or 46% as compared to $261,300 for the same period of 2014. The increase was mainly a result of increase in salaries expenses of $108,186 and increase in social insurance expenses of $11,164.

Utilities expenses

Utilities expenses mainly consists of charges for water and electricity and heating fee. Total Utilities expenses was $191,648 for the three months ended March 31, 2015, an increase of $167,530 or 695% as compared to $24,118 for the same period of 2014. The Utilities expenses was mainly a result of heating fee of $125,145 and increase in charges for water and electricity and heating fee of $43,933.

Income Taxes

Jiarun's medical services have been exempt from enterprise income tax since March 1, 2006, which has been approved by the Local Taxation Bureau.

Jiarun was incorporated in accordance with the law of medical and health institutions mainly provide medical services, with the "PRC Business Tax Tentative Regulations" Article 8 (3) medical service income tax-free provisions (hospital, clinics and other medical institutions to provide medical services shall be exempt from business tax). The Company's medical services have been exempted from business tax since March 1, 2006.

In considering the achievements of the hospital, they could not have been reached without the support of local authorities, Jiarun hospital has voluntarily paid income tax voluntary of $Nil and $781 for the three months ended March 31, 2015 and 2014, respectively to support the local tax bureau's economical obligations.

Income from Operations and Net income

Income from Operations was $459,496 for the three months ended March 31, 2015, as compared with operating income of $258,667 for the three months ended March 31, 2014.The Company’s net income for the three months ended March 31, 2015 was $472,036 representing an increase of $204,182 or 76%, over $267,854 for the three months ended March 31, 2014. The increases in income from operations and net income for the three months ended March 31, 2015 were primarily due to aforementioned changes in operating revenue and operating expenses.

Liquidity and Capital Resources

The accompanying financial statements have been prepared for the Company to continue as a going concern which contemplates, among other things, the realization of assets and satisfaction of liabilities in the ordinary course of business.

As of March 31, 2015, the Company had approximately $476,489 of cash and cash equivalents.

We are presently able to meet our obligations as they come due. As of March 31, 2015, we had non-controlling interest of $3,153,387 and shareholders’ equity of $2,518, 032.

We anticipate that our future liquidity requirements will arise from the need to fund our growth, pay current obligations and future capital expenditures. The primary sources of funding for such requirements are expected to be cash generated from operations and raising additional funds from the public offering and/or debt financing. However, we can provide no assurances that we will be able to generate sufficient cash flow from operations and/or obtain additional financing on terms satisfactory to us, if at all, to remain a going concern.

Cash Flows and Capital Resources

We believe that we will generate cash flow from our business, which, along with our available cash, will provide sufficient liquidity and financial flexibility.

Our cash flows are summarized below:

	Three Months Ended March 31,
	2015			2014
Net cash provided by operating activities		337,249			303,986
Net cash used in investing activities		(1,048,953	)		(979,411	)
Net cash provided by financing activities		137,767			228,911
Effect of exchange rate fluctuation on cash and cash equivalents		3,941			(611	)
Net decrease in cash and cash equivalents		(569,996	)		(447,125	)
Cash and cash equivalents, beginning of period		1,046,485			631,288
Cash and cash equivalents, ending of period	$	476,489		$	184,163

Net Cash provided by Operating Activities

For the three months ended March 31, 2015, we had positive cash flow from operating activities of $337,249, an increase of $33,263 from the same period of 2014, during which we had cash flow from operating activities of $303,986. The net income for the three months ended March 31, 2015 increased by $204,182 as compared to the three months ended March 31, 2014. The increase in net cash provided by operating activities was mainly as a result of the increase of advance to related parties items totaling $60,879, which was due to the increase in receiving equipment by prepayments.

Net Cash Used in Investing Activities

Net cash used in investing activities for the three months ended March 31, 2015 was $1,048,953, compared to net cash used in investing activities of $979,411 for the three months ended March 31, 2014. The cash used in investing activities for the three months ended March 31, 2015 was mainly used for the purchase of medical equipment.

Net Cash Provided by Financing Activities

Net cash provided by financing activities for the three months ended March 31, 2015 was $137,767, as compared to net cash used in financing activities of $228,911 for the three months ended March 31, 2014. The cash provided by financing activities for the three months ended March 31, 2015 was mainly provided by proceeds from shareholders of $178,048.

Trends, Events and Uncertainties

The China Ministry of Health, as well as other related agencies, may change the prices we can charge for medical services, drugs and medications. We cannot predict the impact of these proposed changes since the changes are not fully defined and we do not know whether such changes will ever be implemented or when they may take effect.

In December 2014, our operations moved into the new building. We have finished most of the decoration of the new building, part of the expansion of medical facilities and purchases of new medical equipment. The hospital will need more medical facilities to update the medical equipment and acquire one pharmaceuticals wholesale and one medicine retail company. The new hospital building is being constructed by Harbin Baiyi Real Estate Development Co., Ltd, which is owned by Junsheng Zhang, a related party. The building was leased from the related party by financial leasing, the price of leasing agreement referred to the local market price and audited by the auditor. The Leasing terms consist of 30 payments. Each payment will be made on an annual basis when 7 million RMB per payment will be paid upfront for each leasing period. The first payment was made on September 1^st, 2014. At the end of the leasing period, a final payment will be made to settle the total leasing amount. Both parties agreed for the leasee to pay 3 million RMB as deposit at the execution of the Leasing agreement, which will be deducted from the final rental settlement. The lending interest rate was calculated at 6.55%, which is the benchmark interest rate announced from The People’s Bank of China. After the completion of all payments, the ownership of the lease item will be transferred to the Leasee (Jiarun hospital). As of March 31, 2015, we had paid approximately $485,476 for the construction of the new hospital. We borrowed the funds from our related company and banks. In addition to what we had paid for the new hospital building construction, we estimate the additional costs to complete the project and more medical facilities to update the medical equipment.

We plan to acquire other hospitals and companies involved in the healthcare industry in the PRC using cash and shares of our common stock. Substantial capital may be needed for these acquisitions and we may need to raise additional funds through the sale of our common stock, debt financing or other arrangements. We do not have any commitments or arrangements from any person to provide us with any additional capital. Additional capital may not be available to us, or if available, on acceptable terms, in which case we would not be able to acquire other hospitals or businesses in the healthcare industry.

Other than the factors listed above we do not know of any trends, events or uncertainties that have had or are reasonably expected to have a material impact on our net sales or revenues or income from continuing operations. Our business is not seasonal in nature.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet items reasonably likely to have a material effect on our financial condition.

Recent Accounting Pronouncements

Recent accounting pronouncements issued by the FASB, the AICPA and the SEC did not, or are not believed by management to, have a material effect on the Company’s present or future consolidated financial statements.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

As a “smaller reporting company”, we are not required to provide the information required by this Item.

ITEM 4. CONTROLS AND PROCEDURES

Evaluations of Disclosure Controls and Procedures

Under the supervision and with the participation of our management team, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) and 15d-15(e) promulgated under the Securities Exchange Act of 1934, as amended, as of December 31, 2004. Based on this evaluation, we concluded that our disclosure controls and procedures are effective in timely alerting them to material information required to be included in our periodic reports.

Changes in Internal Control over Financial Reporting

During the period covered by this report, there has been no change in our internal control over financial reporting that has materially affected or is reasonably likely to materially affect our internal control over financial reporting.

PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

The Company has no knowledge of existing or pending legal proceedings against the Company, nor is the Company involved as a plaintiff in any proceeding or pending litigation. There are no proceedings in which any of the Company’s directors, officers or any of their respective affiliates, or any beneficial stockholder, is an adverse party or has a material interest adverse to our interest.

ITEM 1A. RISK FACTORS

As a “smaller reporting company”, we are not required to provide the information required by this Item.

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

We did not issue any unregistered securities during the period covered by this Report.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

Not applicable

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable

ITEM 5. OTHER INFORMATION

Not applicable

ITEM 6. EXHIBITS

INDEX TO EXHIBITS

Exhibit		Description
31.1		Certification of Chief Executive Officer pursuant to Securities Exchange Act Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2		Certification of Chief Financial Officer pursuant to Securities Exchange Act Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1		Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2		Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS		XBRL Instance Document
101.SCH		XBRL Taxonomy Extension Schema Document
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF		XBRL Definition Linkbase Document
101.LAB		XBRL Taxonomy Extension Label Linkbase Document
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document

SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

JRSIS HEALTH CARE CORPORATION. (Registrant)

Signature	Title	Date
Lihua. Sun
/s/ Lihua. Sun	Chief Executive Officer and Director	May 12, 2015
	(Principal Executive Officer)

Xuewei. Zhang
/s/ Xuewei. Zhang	Chief Financial Officer and Director,	May 12, 2015
	(Principal Financial Officer)

JRSIS HEALTH CARE Corp - FORM 10-Q - May 12, 2015

Attached files

JRSIS HEALTH CARE Corp Reports