Attached files

file filename
EX-32.1 - EXHIBIT 32.1 - JIN WAN HONG INTERNATIONAL HOLDINGS Ltdv451405_ex32-1.htm
EX-31.1 - EXHIBIT 31.1 - JIN WAN HONG INTERNATIONAL HOLDINGS Ltdv451405_ex31-1.htm
EX-23.1 - EXHIBIT 23.1 - JIN WAN HONG INTERNATIONAL HOLDINGS Ltdv451405_ex23-1.htm

 

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549

 

Form 10-K

 

x Annual Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the fiscal year ended May 31, 2016

 

¨ 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  333-197724

 

JIN WAN HONG INTERNATIONAL HOLDINGS LIMITED 
(Exact name of small business issuer as specified in its charter)

 

Nevada 7385 30-0809134
(State or other jurisdiction of (Primary Standard Industrial (IRS Employer
incorporation or organization) Classification Number) Identification Number)

 

Room 1101, Block E, Guang Hua Yuan, 2031 Bin He Nan Road

FuTian District, Shenzhen City, China

(Address of principal executive offices)

 

+ 86 189-4831-9148

(Issuer's telephone number)

 

None

Securities registered under Section 12(b) of the Exchange Act

 

None

Securities registered under Section 12(g) of the Exchange Act

 

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ¨      No x

 

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act.  Yes ¨       No x

 

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 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 if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. Yes ¨  No x

 

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 ¨
  Smaller reporting
company x

 

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

 

State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date:   8,100,000 common shares issued and outstanding as of October 20, 2016.

 

 

 

 

TABLE OF CONTENTS

 

    Page
     
PART I    
     
Item 1. Description of Business. 3
Item 1A. Risk Factors. 7
Item 1B. Unresolved Staff Comments. 7
Item 2 Properties. 7
Item 3. Legal proceedings. 7
Item 4. Mine Safety Disclosures. 7
     
PART II    
     
Item 5. Market for Common Equity and Related Stockholder Matters. 8
Item 6. Selected Financial Data. 8
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations. 8
Item 7A. Quantitative and Qualitative Disclosures About Market Risk. 12
Item 8. Financial Statements and Supplementary Data. 12
Item 9. Changes In and Disagreements With Accountants on Accounting and Financial Disclosure. 23
Item 9A(T). Controls and Procedures 24
Item 9B. Other Information. 25
     
PART III    
     
Item 10 Directors, Executive Officers, Promoters and Control Persons of the Company. 25
Item 11. Executive Compensation. 27
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters. 27
Item 13. Certain Relationships and Related Transactions, and Director Independence. 28
Item 14. Principal Accounting Fees and Services. 28
     
PART IV    
     
Item 15. Exhibits 28
     
Signatures  

 

 

 

 

PART I

 

Item 1. Description of Business

 

FORWARD-LOOKING STATEMENTS

 

This annual report contains forward-looking statements. These statements relate to future events or our future financial performance. These statements often can be identified by the use of terms such as "may," "will," "expect," "believe," "anticipate," "estimate," "approximate" or "continue," or the negative thereof. We intend that such forward-looking statements be subject to the safe harbors for such statements. We wish to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. Any forward-looking statements represent management's best judgment as to what may occur in the future. However, forward-looking statements are subject to risks, uncertainties and important factors beyond our control that could cause actual results and events to differ materially from historical results of operations and events and those presently anticipated or projected. We disclaim any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such statement or to reflect the occurrence of anticipated or unanticipated events.

 

Company

 

KARNET CAPITAL CORP. was incorporated in the State of Nevada on January 31, 2014. We were a Company formed to sell food waste processors in Russian Federation. We planned to spread our operation throughout Russian Federation’s major cities: Moscow and Sankt Petersburg. In the beginning we intended to create a distribution channel for our Food Waste Disposal Units by signing distribution agreements with existing home appliances chains and independent stores in Saint - Petersburg. On January 14, 2016, Shu Feng Lu, Hong Xia Li, and Chen Yang took control of the Company by purchasing shares of common stock from existing shareholders. After the transaction our new shareholder is currently working on new business plan and winding up the current business plan, starting with a name changing process that is under review with FINRA. The company will change its name to Jin Wan Hong International Holdings Limited, and plans to operating in cultural related business in the future.

 

Business Opportunity

 

Food waste is a large component of our solid waste problem. And the question of what to do with it is a challenge for communities worldwide. The U.S. alone generates more than 34 million tons of food waste each year. The Russian Statistical Office Gosstat recently submitted its first official figures on food waste in Russia. According to Gosstat, 56 kg of food is thrown away per person per year in the Russian Federation. Much of it ends up in landfills. Food scraps are big part of household waste, and are a problematic component of municipal waste, creating public health, sanitation and environmental problems at each step, beginning with internal storage and followed by truck-based collection. Burned in waste-to-energy facilities, the high water-content of food scraps means that their heating and burning consumes more energy than it generates; buried in landfills, food scraps decompose and generate methane gas, which is a greenhouse gas. With waste produced across all sectors of the economy, and throughout supply chains, it is important to look for opportunities to prevent waste from arising in the first place and to manage the waste that does arise more effectively.

 

The premise behind the use of a Food Waste Disposal Unit is to effectively regard food scraps as liquid (averaging 70% water, like human waste), and use existing infrastructure (underground sewers and wastewater treatment plants) for its management. 

 

For a long time, landfill has been the main disposal method for municipal wastes in Russia. However, there is strong pressure to reduce the use of land filling as demonstrated by the increasingly stringent regulations which limit untreated waste going to landfill. It is being agreed that the use of FWD (Food Waste Disposal units) is beneficial in reducing the quantity of biodegradable wastes going to landfill. Previous studies in Japan found that FWDs could reduce current waste production by 40%.

 

 3 

 

 

In Russian Federation such reduction is unlikely but it would translate into significant reduction in the costs of curbside waste collection, transportation, treatment and disposal, generating substantial savings for local authorities. Previous studies have reported that addition of food waste in the sewer could cause considerable modifications of the resulting wastewater. Bolzonella et al. (2003) found that food waste contained 74.4% water (25.6% solids),96.5% organic, 3.2% nitrogen, and 0.2% phosphorus. Such modifications can substantially improve biological removal of phosphorus and nitrogen during wastewater treatment and reduce costs for purchase of chemicals and/or additional carbon for phosphorus removal (Battistoni etal. 2007). In addition, increased organic loads in wastewater can generate biogas during anaerobic waste water treatment.

 

Our food waste disposers provide a convenient and environmentally friendly alternative to transporting leftovers to landfills. Plus, capable wastewater treatment plants can even recycle food scraps into energy and fertilizer. Durable. Practical. And environmentally responsible. A recent Life Cycle Assessment (LCA) of common ways to dispose of food scraps reported that disposers can help reduce global warming potential vs. landfills and in some cases, can even aid in energy production at the wastewater treatment plant.

 

Food waste disposal units are widely used in US, but they are not widely known on Russian market. This is why we see it as a viable opportunity, that worth pursuing.

 

PRODUCT

 

We were planning to introduce 3 different models for food waste disposal units, with 1/2, 3/5 and 1 HP motors:

 

Foreal FY LD800-A

 

Power: 1HP
Voltage: 220V
Frequency: 60Hz
Rotation Speed: 3300R/Min
Motor: DC Perpetual Magnetism
Overload Protector: Standard
Dish Washer: Connectable
Sound Insulation: Airproof
Colors for choice: Red, Green, Yellow
Weight: 5.8kg; L13.2〞*W8.3〞*H7.5〞
Warranty: 2 years
Working time: 15years
Noise standard: ≤30dB
Volume: 830ml

 

 4 

 

 

Foreal FY A730X

 

Power: 3/5HP
Voltage: 220V
Frequency: 60Hz
Rotation Speed: 2800R/Min
Motor: DC Perpetual Magnetism
Overload Protector: Standard
Dish Washer: Connectable
Sound Insulation: Airproof
Colors for choice: Red, Green, Yellow
Weight: 5.8kg; L13.2〞*W8.3〞*H7.5〞
Warranty: 2 years
Working time: 15years
Noise standard: ≤30dB
Volume: 830ml

 

Foreal FY A630

 

Power: 1/2HP
Voltage: 220V
Frequency: 60Hz
Rotation Speed: 2800R/Min
Motor: DC Perpetual Magnetism
Overload Protector: Standard
Dish Washer: Connectable
Sound Insulation: Airproof
Colors for choice: Red, Green, Yellow
Weight: 5.8kg; L13.2〞*W8.3〞*H7.5〞
Warranty: 2 years
Working time: 15years
Noise standard: ≤30dB
Volume: 1000ml

 

Target Market

 

The target group was composed of private households with above average income and retail food and beverage establishments.

 

Marketing

 

We intended to concentrate our marketing effort on finding and approaching local home appliance chains and stores. Signing a contract with established home appliance chains and stores would allow us to tap into their existing customer base. In order to draw attention to our products we would organize in-store demonstration seminars for store stuff, so they would have better idea on how to market our product and highlight benefits of using Food Waste Disposal Units.

 

Advertising in a variety of local publications would increase knowledge of our locations and a favourable review in the local media would increase interest.

 

 5 

 

 

Industry advertising

 

We intended to advertise online and using ads in industry-related magazines. Some sites and industry media had already been identified. Media advertising campaign would coincide with Trade Show marketing campaign.

 

Freight and Storage

 

We planned to ship our product directly from China to Russian Federation and store them at our distributor’s warehouse. That would exempt us from any import or tax duties in UK. Goods imported from outside of Russia require payment of import duty. Import Duty for bringing our garburators to Russia would be 15% of Customs Valuation. The primary basis for customs valuation is “transaction value” transaction value, defined as the price actually paid or payable for the goods when sold for export to the country of importation. We did not require any storage facility, because our supplier would ship our products directly from manufacturer to our existent or future distributors. we did not have written contract with any of the shipping companies.

 

Distributorship Channel

 

There were several existing home appliance chains and stores that meet our requirement to become a distributor of our products:

 

Eldorado

 

There are 45 retail locations in Saint - Petersburg.

 

Mvideo

 

There are 18 retail locations in Saint - Petersburg.

 

Tehnosila

 

There are 22 retail locations in Saint - Petersburg.

 

We had not signed any contracts with above mentioned companies at the moment.

 

Office

 

Our principal executive office is located at 1101, Block E, Guang Hua Yuan, 2031 Bin He Nan Road, Fu Tian District, Shenzhen City, China. Our CEO provides our company with office space at no charge. Office will be established with basic office equipment, which should not exceed $1,000 in expenses. The office will be used for communication with customers and hold all related equipment and paperwork.

 

Personnel

 

During the first stages of our growth, our former President and director provided all of the labour required to execute our operations at no charge at his own location.  Our former President were devoting approximately 30% of his time to our operations.

 

Competition

 

Although our products were not widely known in Russia, the small kitchen appliances market was already established and highly competitive. There were many small and midsized companies with established sales channels and client bases. We hoped to build relationships with some of these client basis for retail sales of our products.  Some of these potential clients had the ability, and might choose to manufacture similar products themselves. This highly competitive environment could materially adversely affect our business, financial condition, results of operations, cash flows and prospects. We might not be able to get most suitable locations or advertising spacing due to a smaller marketing budget. It was also likely that we might be forced to lower the price of our Garburators below our set pricing to keep up with completion, which would affect our profits.

 

 6 

 

 

Future Plans

 

On January 14, 2016, Shu Feng Lu, Hong Xia Li, and Chen Yang took control of the Company by purchasing shares of common stock from existing shareholders. After the transaction our new shareholder is currently working on new business plan, starting with a name changing process that is under review with FINRA. The company will change its name to Jin Wan Hong International Holdings Limited, and plans to operating in cultural related business in the future. The new business plan is still under development and evaluation.

 

Item 1A.  Risk Factors

 

Not applicable to smaller reporting companies.

 

Item 1B. Unresolved Staff Comments.

 

Not applicable to smaller reporting companies.

 

Item 2.  Description of Property

 

We do not own any real estate or other properties.  

 

Item 3.  Legal Proceedings

 

We know of no legal proceedings to which we are a party or to which any of our property is the subject which are pending, threatened or contemplated or any unsatisfied judgments against us.

 

Item 4.  Mine Safety Disclosures

 

Not applicable.

 

 7 

 

 

PART II

 

Item 5. Market for Common Equity and Related Stockholder Matters

 

Market Information

 

There is a limited public market for our common shares.  Our common shares are not quoted on the OTC Bulletin Board at this time.  Trading in stocks quoted on the OTC Bulletin Board is often thin and is characterized by wide fluctuations in trading prices due to many factors that may be unrelated to a company’s operations or business prospects.  We cannot assure you that there will be a market in the future for our common stock.

 

OTC Bulletin Board securities are not listed or traded on the floor of an organized national or regional stock exchange.  Instead, OTC Bulletin Board securities transactions are conducted through a telephone and computer network connecting dealers in stocks.  OTC Bulletin Board issuers are traditionally smaller companies that do not meet the financial and other listing requirements of a regional or national stock exchange.

 

As of October 25, 2016, no shares of our common stock have traded

 

Number of Holders

 

As of October 25, 2016, the 8,100,000 issued and outstanding shares of common stock were held by a total of 3 shareholders of record.

 

Dividends

 

No cash dividends were paid on our shares of common stock during the fiscal year ended May 31, 2016 and or the period from January 31, 2014 (inception) to May 31, 2016.  We have not paid any cash dividends since January 31, 2014 (inception) and do not foresee declaring any cash dividends on our common stock in the foreseeable future. 

 

Recent Sales of Unregistered Securities

 

The Company has 75,000,000, $0.001 par value shares of common stock authorized.

 

There were 8,100,000 shares of common stock issued and outstanding as of May 31, 2016.

 

Other Stockholder Matters

 

None.

 

Item 6. Selected Financial Data

 

Not applicable to smaller reporting companies.

 

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations

 

The following discussion should be read in conjunction with our financial statements, including the notes thereto, appearing elsewhere in this annual report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs.  Our actual results could differ materially from those discussed in the forward-looking statements.   Our audited financial statements are stated in United States Dollars and are prepared in accordance with United States Generally Accepted Accounting Principles.

 

 8 

 

 

GENERAL

 

On January 14, 2016, Shu Feng Lu, Hong Xia Li, and Chen Yang took control of the Company by purchasing shares of common stock from existing shareholders. After the transaction our new shareholder is currently working on new business plan and winding up the current business plan, starting with a name changing process that is under review with FINRA. The company will change its name to Jin Wan Hong International Holdings Limited, and plans to operating in cultural related business in the future.

 

RESULTS OF OPERATIONS

 

We have incurred recurring losses to date. Our financial statements have been prepared assuming that we will continue as a going concern and, accordingly, do not include adjustments relating to the recoverability and realization of assets and classification of liabilities that might be necessary should we be unable to continue in operation.

 

We expect we will require additional capital to meet our long term operating requirements. We expect to raise additional capital through, among other things, the sale of equity or debt securities.

 

FISCAL YEAR ENDED MAY 31, 2016 COMPARED TO MAY 31, 2015.

 

Revenue

 

We recognized revenue of $0 for the year ended May 31, 2015, compare to $7,688 the year ended May 31, 2015.

 

Operating expenses

 

We incurred operating expenses of $25,275 for the year ended May 31, 2015 compared to $15,876 for the year ended May 31, 2015.  

 

Net Losses

 

Our net loss for the fiscal year ended May 31, 2016 was $25,275 compared to a net loss of $13,313 as of May 31, 2015  due to the factors discussed above.    

 

Liquidity and Capital Resources

 

As of May 31, 2016, our total assets were $0 comprised of cash and cash equivalents. Our total liabilities were $0. As of May 31, 2015, our total assets were $4,335. Our total liabilities were $11,760 comprised of a loan from director.

 

Shareholders’ equity has increased from $(7,425) as of May 31, 2015 to $0as of May 31, 2016. Deficit was due to the increase in operating expenses.

 

The Company has accumulated a deficit of $(38,700) as of May 31, 2016 and further losses are anticipated in the development of its business. Accordingly, there is substantial doubt about the Company’s ability to continue as a going concern.  

 

The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and, or, obtaining the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management intends to finance operating costs over the next twelve months with existing cash on hand, sales, loans from directors and, or, the private placement of common stock.  

 

 9 

 

 

Because of the Company’s history of losses, its independent auditors, in the reports on the financial statements for the year ended May 31, 2016 and May 31, 2015, expressed substantial doubt about the Company’s ability to continue as a going concern. The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which contemplate continuation of the Company as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that could result from the outcome of this uncertainty.

 

Management anticipates that the Company will be dependent, for the near future, on additional investment capital to fund operating expenses The Company intends to position itself so that it may be able to raise additional funds through the capital markets. In light of management’s efforts, there are no assurances that the Company will be successful in this or any of its endeavors or become financially viable and continue as a going concern.

 

Cash Flows from Operating Activities

 

We have not generated positive cash flows from operating activities. For the fiscal year ended May 31, 2016, net cash flows used in operating activities was $25,355 compared to $7,928 for May 31, 2015 .

 

Cash Flows from Investing Activities

 

We neither used nor generated cash from investing activities for the fiscal year ended May 31, 2016 and May 31, 2015.

 

Cash Flows from Financing Activities

 

For the fiscal year ended May 31, 2016, net cash provided by financing activities was $21,200. For the fiscal year ended May 31, 2015, net cash provided by financing activities was $11,000.

 

PLAN OF OPERATION AND FUNDING

 

We expect that working capital requirements will continue to be funded through a combination of our existing funds, sales, loans from a director and further issuances of securities. Our working capital requirements are expected to increase in line with the growth of our business

 

We have no lines of credit or other bank financing arrangements. Generally, we have financed operations to date through the proceeds of the private placement of equity, debt instruments, and limited sales. In connection with our business plan, management anticipates additional increases in operating expenses and capital expenditures relating to:

 

· Legal and professional fees

· Website development

· Purchase of inventory

· Marketing Campaign

 

We intend to finance these expenses with further issuances of securities, debt issuances and sales. Thereafter, we expect we will need to raise additional capital and generate revenues to meet long-term operating requirements. Additional issuances of equity or convertible debt securities will result in dilution to our current shareholders. Further, such securities might have rights, preferences or privileges senior to our common stock. Additional financing may not be available upon acceptable terms, or at all. If adequate funds are not available or are not available on acceptable terms, we may not be able to take advantage of prospective new business endeavors or opportunities, which could significantly and materially restrict our business operations.

 

 10 

 

 

MATERIAL COMMITMENTS

 

As of the date of this Annual Report, we do not have any material commitments.

 

PURCHASE OF SIGNIFICANT EQUIPMENT

 

We have not purchased any significant equipment during the last - twelve months.

 

OFF-BALANCE SHEET ARRANGEMENTS

 

As of the date of this Annual Report, we do not have any off balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.

 

GOING CONCERN

 

The Company has generated limited revenues and incurred a loss since Inception (January 31, 2014) resulting in an accumulated deficit of ( $38,669) as of May 31, 2016 and further losses are anticipated in the development of its business. Accordingly, there is substantial doubt about the Company’s ability to continue as a going concern.

 

Because of the Company’s history of losses, its independent auditors, in the reports on the financial statements for the year ended May 31, 2016 and for the period from Inception (January 31, 2014) to May 31, 2015, expressed substantial doubt about the Company’s ability to continue as a going concern. The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which contemplate continuation of the Company as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that could result from the outcome of this uncertainty.

 

SIGNIFCANT ACCOUNTING POLICIES

 

Basis of Presentation

The accompanying financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America, and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) and reflect all adjustments, consisting of normal recurring adjustments, which management believes are necessary to fairly present the financial position, results of operations, stockholders’’ equity  and cash flows of the Company for the year ending May 31, 2015

 

Accounting Basis

The Company uses the accrual basis of accounting and accounting principles generally accepted in the United States of America (“GAAP” accounting).  The Company has adopted a May 31 fiscal year end.

 

Cash and Cash Equivalents

The Company considers all highly liquid investments with the original maturities of three months or less to be cash equivalents. The Company had $0 of cash as of May 31, 2016.

 

Fair Value of Financial Instruments

The Company’s financial instruments consist of cash and cash equivalents and amounts due to shareholder. The carrying amount of these financial instruments approximates fair value due either to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these financial statements.

 

Inventories

Inventories are stated at the lower of cost or market. Cost is principally determined using the first-in, first out (FIFO) method. The Company had $0 in inventory as of May 31, 2015.

 

 11 

 

 

Depreciation, Amortization, and Capitalization

The Company records depreciation and amortization when appropriate using both straight-line and declining balance methods over the estimated useful life of the assets (five to seven years). Expenditures for maintenance and repairs are charged to expense as incurred. Additions, major renewals and replacements that increase the property's useful life are capitalized. Property sold or retired, together with the related accumulated depreciation is removed from the appropriated accounts and the resultant gain or loss is included in net income.

 

Income Taxes

Income taxes are computed using the asset and liability method.  Under the asset and liability method, deferred income tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities and are measured using the currently enacted tax rates and laws.  A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not expected to be realized.

 

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date the financial statements and the reported amount of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

 

Revenue Recognition

The Company recognizes revenue when products are fully delivered or services have been provided and collection is reasonably assured.

 

Stock-Based Compensation

Stock-based compensation is accounted for at fair value in accordance with ASC Topic 718.  To date, the Company has not adopted a stock option plan and has not granted any stock options.

 

Basic Income (Loss) Per Share

Basic income (loss) per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. There are no such common stock equivalents outstanding as of May 31, 2016.

 

Comprehensive Income

The Company has which established standards for reporting and display of comprehensive income, its components and accumulated balances.  When applicable, the Company would disclose this information on its Statement of Stockholders’ Equity.  Comprehensive income comprises equity except those resulting from investments by owners and distributions to owners. The Company has not had any significant transactions that are required to be reported in other comprehensive income.

 

Recent Accounting Pronouncements

 

JIN WAN HONG INTERNATIONAL HOLDINGS LIMITED does not expect the adoption of recently issued accounting pronouncements to have a significant impact on the Company’s results of operations, financial position or cash flow.

 

Item 7A. Quantitative and Qualitative Disclosures about Market Risk   

 

Not applicable to smaller reporting companies.

 

Item 8. Financial Statements and Supplementary Data   

 

 12 

 

 

KARNET CAPITAL CORP.

 

FINANCIAL STATEMENTS

 

For the Years Ended May 31, 2016 and May 31, 2015

 

Table of Contents

 

    Page
Report of Independent Registered Public Accounting Firm   14
     
Balance Sheets as of May 31, 2016 and May 31, 2015   15
     
Statement of Operations for year ended May 31, 2016 and  May 31, 2015   16
     
Statement of Stockholders’ Equity as of May 31, 2016 and May 31, 2015   17
     
Statement of Cash Flows for the year ended May 31, 2016 and May 31, 2015   18
     
Notes to  Financial Statements   19

 

 13 

 

 

MICHAEL GILLESPIE & ASSOCIATES, PLLC

CERTIFIED PUBLIC ACCOUNTANTS

10544 ALTON AVE NE

SEATTLE, WA 98125

206.353.5736

 

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

To the Board of Directors

Karnet Capital Corp.

 

We have audited the accompanying balance sheets of Karnet Capital Corp. as of May 31, 2016 and 2015 and the related statements of operations, changes in stockholder’s equity and cash flows for the periods then ended. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audit.

 

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

 

In our opinion, subject to the condition noted in the following paragraph, the financial statements referred to above present fairly, in all material respects, the financial position of Karnet Capital Corp.

 

For the years ended May 31, 2016 and 2015 and the results of its operations and cash flows for the periods then ended in conformity with generally accepted accounting principles in the United States of America.

 

The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note #2 to the financial statements, although the Company has limited operations it has yet to attain profitability. This raises substantial doubt about its ability to continue as a going concern. Management’s plan in regard to these matters is also described in Note #2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

/S/ MICHAEL GILLESPIE & ASSOCIATES, PLLC

 

Seattle, Washington

October 18, 2016

 

 14 

 

 

KARNET CAPITAL CORP.

 

Balance sheet

 

(Audited)

 

  

31-May
16

   31-May
15
 
   (Audited)   (Audited) 
         
ASSETS          
Current Assets:          
Cash  $0   $4,335 
Total Current Assets   0    4,335 
           
Total Assets  $0   $4,335 
           
LIABILITIES AND SHAREHOLDERS’ EQUITY          
Current Liabilities:          
Accounts payable  $-   $260 
Loan from director   -    11,500 
           
Total Liabilities   -    11,760 
           
Shareholders’ Equity:          
Common stock, par value $0.001; 75,000,000 shares authorized, 8,100,000 and 6,000,000 shares issued and outstanding, respectively   8,100    6,000 
Additional paid-in capital  $30,600   $- 
Accumulated deficit   (38,700)   (13,425)
           
Total Shareholders’ Equity   0    (7,425)
           
Total Liabilities and Shareholders’ Equity  $0   $4,335 

 

The accompanying notes are an integral part of these financial statements

 

 15 

 

 

KARNET CAPITAL CORP.

 

Statements of Operations

(Audited)

 

   12 Months
Ended
   12 Months
Ended
 
   May 31,2016   May 31,2015 
         
Revenues:  $-   $7,688 
Cost of Goods Sold   -    5,125 
Gross Margin   -    2,563 
           
Operating Expenses:          
General and administrative expenses   25,275    15,876 
Total operating expenses   25,275    15,876 
Net loss from operations   (25,275)   (13,313)
Provision for income taxes   -    - 
Net Loss  $(25,275)  $(13,313)
Net loss per share: basic and diluted  $(0.00)  $(0.00)
Weighted average number of common shares outstanding: basic and diluted   7,779,508    6,000,000 

 

The accompanying notes are an integral part of these financial statements

 

 16 

 

 

KARNET CAPITAL CORP.

 

Statement of Stockholders’ Equity 

(Audited)

 

   Common Stock   Additional   Accumulated   Total 
   Shares   Amount   Paid in Capital   Deficit   Stockholders’Equity 
Inception, January 31, 2014   -   $-        $-   $- 
Shares issued for cash at $0.001 per share   6,000,000    6,000         -    6,000 
Net loss for the year ended May 31, 2014   -    -         (112)   (112)
Balance, May 31, 2014   6,000,000   $6,000        $(112)  $5,888 
Net loss for the year ended May 31, 2015                  (13,313)   (13,313)
Balance, May 31, 2015   6,000,000   $6,000        $(13,425)  $(7,425)
Shares issued for cash at $0.001 per share   2,100,000    2,100    30,600         32,700 
Net loss for the year ended May 31, 2016                  (25,275)   (25,275)
Balance, May 31, 2016   8,100,000   $8,100   $30,600   $(38,700)  $0 

 

The accompanying notes are an integral part of these financial statements

 

 17 

 

 

KARNET CAPITAL CORP.

 

Statements of Cash Flows

(Audited)

 

   12 Months Ended   12 Months Ended 
   31-May-16   31-May-15 
         
Cash flows from operating activities:        
Net loss for the period  $(25,275)  $(13,313)
Adjustments to reconcile net loss to net cash (used in) operating activities:          
Changes in operating assets and liabilities:          
Deposit/inventory   -    5,125 
Decrease in Accounts payable   (260)   260 
Net cash flows used in operating activities   (25,535)   (7,928)
           
Cash flows from investing activities   -    - 
           
Cash flows from financing activities:          
Proceeds from sale of common stock   21,000    - 
Loans from director   -    11,000 
Contributed capital   200    - 
Net cash flows provided by financing activities   21,200    11,000 
           
Net increase (decrease) in cash   (4,335)   3,072 
Cash, beginning of the period   4,335    1,263 
Cash, end of the period  $0   $4,335 
           
Supplemental Cash Flow Information:          
Interest paid  $-   $- 
Income taxes paid  $-   $- 
Supplemental disclosure of non-cash activities:          
Forgiveness of related party debt  $11,500   $- 

  

The accompanying notes are an integral part of these financial statements

 

 18 

 

 

KARNET CAPITAL CORP.

 

Notes to the Financial Statements

 

February 29, 2016

 

(Audited)

 

1.NATURE OF OPERATIONS

 

KARNET CAPITAL CORP. was incorporated in the State of Nevada on January 31, 2014. We were a Company formed to sell food waste processors in the Russian Federation.

 

On January 14, 2016, Shu Feng Lu, Hong Xia Li, and Chen Yang took control of the Company by purchasing shares of common stock from existing shareholders.

 

Shu Feng Lu purchased 6,700,000 shares of common stock in exchange for $235,740 of personal funds, Hong Xia Li purchased 700,000 shares of common stock in exchange for $24,630 of personal funds, and Chen Yang purchased 700,000 shares of common stock in exchange for $24,630 of personal funds.

 

After the transaction, Shu Feng Lu is the beneficial owner of 82.72% of the voting securities of the Company, Hong Xia Li is the beneficial owner of 8.64% of the voting securities of the Company, and Chen Yang is beneficial owner of 8.64% of the voting securities of the Company.

 

After the transaction our new shareholder is currently working on new business plan, starting with a name changing process that is under review with FINRA. The company plans to operating in cultural related business in the future. The company’s current operating in Shenzhen, Guangdong, China.

 

2.GOING CONCERN

 

The Company has generated limited revenues and incurred a loss since Inception (January 31, 2014) resulting in an accumulated deficit of $38,669 as of May 31, 2016 and further losses are anticipated in the development of its business. Accordingly, there is substantial doubt about the Company’s ability to continue as a going concern.

 

The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and, or, obtaining the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management intends to finance operating costs over the next twelve months with existing cash on hand, loans from directors and, or, the private placement of common stock.

 

Because of the Company’s history of losses, its independent auditors, in the reports on the financial statements for the year ended May 31, 2015, expressed substantial doubt about the Company’s ability to continue as a going concern. The accompanying audited financial statements for the twelve months period ended May 31, 2016 have been prepared in conformity with accounting principles generally accepted in the United States of America, which contemplate continuation of the Company as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that could result from the outcome of this uncertainty.

 

Management anticipates that the Company will be dependent, for the near future, on additional investment capital to fund operating expenses The Company intends to position itself so that it may be able to raise additional funds through the capital markets. In light of management’s efforts, there are no assurances that the Company will be successful in this or any of its endeavors or become financially viable and continue as a going concern.

 

 19 

 

 

3.SUMMARY OF SIGNIFCANT ACCOUNTING POLICIES

 

Basis of Presentation

 

The accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America, and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) and reflect all adjustments, consisting of normal recurring adjustments, which management believes are necessary to fairly present the financial position, results of operations, stockholders’ equity and cash flows of the Company for the twelve months period ended May 31, 2016

 

Accounting Basis

 

The Company uses the accrual basis of accounting and accounting principles generally accepted in the United States of America (“GAAP” accounting). The Company has adopted a May 31 fiscal year end.

 

Use of Estimates

 

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.

 

Cash and Cash Equivalents

 

The Company considers all highly liquid investments with the original maturities of three months or less to be cash equivalents. There were no cash equivalents as of May 31, 2016.

 

Fair Value of Financial Instruments

 

The Company’s financial instruments consist of cash and cash equivalents and amounts due to shareholder. The carrying amount of these financial instruments approximates fair value due either to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these financial statements.

 

Income Taxes

 

Income taxes are computed using the asset and liability method. Under the asset and liability method, deferred income tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities and are measured using the currently enacted tax rates and laws. A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not expected to be realized.

 

 20 

 

 

3.SUMMARY OF SIGNIFCANT ACCOUNTING POLICIES (CONTINUED)

 

Revenue Recognition

 

The Company follows paragraph 605-10-S99-1 of the FASB Accounting Standards Codification for revenue recognition. The Company will recognize revenue when it is realized or realizable and earned. The Company considers revenue realized or realizable and earned when all of the following criteria are met: (i) persuasive evidence of an arrangement exists, (ii) the product has been shipped or the services have been rendered to the customer, (iii) the sales price is fixed or determinable, and (iv) collectability is reasonably assured.

 

Stock-Based Compensation

 

We account for equity-based transactions with nonemployees under the provisions of ASC Topic No. 505-50, Equity-Based Payments to Non-Employees (“ASC 505-50”). ASC 505-50 establishes that equity-based payment transactions with nonemployees shall be measured at the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable. The fair value of common stock issued for payments to nonemployees is measured at the market price on the date of grant. The fair value of equity instruments, other than common stock, is estimated using the Black-Scholes option valuation model. In general, we recognize the fair value of the equity instruments issued as deferred stock compensation and amortize the cost over the term of the contract.

 

We account for employee stock-based compensation in accordance with the guidance of FASB ASC Topic 718, Compensation—Stock Compensation, which requires all share-based payments to employees, including grants of employee stock options, to be recognized in the financial statements based on their fair values.

 

The fair value of the equity instrument is charged directly to compensation expense and credited to additional paid-in capital over the period during which services are rendered.

 

Basic Income (Loss) Per Share

 

Basic income (loss) per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. There are no such common stock equivalents outstanding as of February 29, 2016 or February 28, 2015.

 

 21 

 

 

3.SUMMARY OF SIGNIFCANT ACCOUNTING POLICIES (CONTINUED)

 

Recent Accounting Pronouncements

 

In August 2014, the FASB issued Accounting Standards Update “ASU” 2014-15 on “Presentation of Financial Statements Going Concern (Subtopic 205-40) –Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern” (“Update”). Currently, there is no guidance in U.S. GAAP about management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern or to provide related footnote disclosures. The amendments in this Update provide that guidance. In doing so, the amendments are intended to reduce diversity in the timing and content of footnote disclosures. The amendments require management to assess an entity’s ability to continue as a going concern by incorporating and expanding upon certain principles that are currently in U.S. auditing standards. Specifically, the amendments (1) provide a definition of the term substantial doubt, (2) require an evaluation every reporting period including interim periods, (3) provide principles for considering the mitigating effect of management’s plans, (4) require certain disclosures when substantial doubt is alleviated as a result of consideration of management’s plans, (5) require an express statement and other disclosures when substantial doubt is not alleviated, and (6) require an assessment for a period of one year after the date that the financial statements are issued (or available to be issued). The amendments in this Update are effective for public and nonpublic entities for annual periods ending after December 15, 2016. Early adoption is permitted.

 

The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

 

4.LOAN FROM DIRECTOR

 

As of May 31, 2015, the Company owed the former CEO and director $11,500. The total loan of $11,500 was unsecured, non-interest bearing and due on demand. Pursuant to a stock purchase agreement dated January 14, 2016, that resulted in a change of control, the former CEO agreed to forgive the debt due to him in full. The Company has credited the $11,500 to paid in capital.

 

 22 

 

 

5.COMMON STOCK

 

The Company has 75,000,000, $0.001 par value shares of common stock authorized.

 

In April, 2014, the Company issued 6,000,000 shares of common stock to a director for cash proceeds of $6,000. The shares were issued at $0.001 per share.

 

In July, 2015, the Company issued 1,000,000 shares of common stock for cash proceeds of $10,000. The shares were issued at $0.01 per share.

 

In July, 2015, the Company issued 310,000 shares of common stock for cash proceeds of $3,100. The shares were issued at $0.01 per share.

 

In July, 2015, the Company issued 470,000 shares of common stock for cash proceeds of $4,700. The shares were issued at $0.01 per share.

 

In July, 2015, the Company issued 160,000 shares of common stock for cash proceeds of $1,600. The shares were issued at $0.01 per share.

 

In July, 2015, the Company issued 160,000 shares of common stock for cash proceeds of $1,600. The shares were issued at $0.01 per share.

 

6.COMMITMENTS AND CONTINGENCIES

 

The Company neither owns nor leases any real or personal property. An officer has provided office services without charge. There is no obligation for the officer to continue this arrangement. Such costs are immaterial to the financial statements and accordingly are not reflected herein. The officers and directors are involved in other business activities and most likely will become involved in other business activities in the future.

 

7.SUBSEQUENT EVENTS

 

In accordance with SFAS 165 (ASC 855-10) the Company has analyzed its operations subsequent to May 31, 2016 through October 18, 2016, and has determined that it does not have any material subsequent events to disclose in these financial statements.

 

Item 9. Changes In and Disagreements with Accountants on Accounting and Financial Disclosure

 

None

 

 23 

 

 

Item 9A(T) Controls and Procedures

 

Management’s  Report on Internal Controls over Financial Disclosure Controls and Procedures

 

Management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f)). The Company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer, the Company conducted an evaluation of the effectiveness of the Company’s internal control over financial reporting as of May 31, 2016 using the criteria established in “Internal Control - Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO").

 

A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis. In its assessment of the effectiveness of internal control over financial reporting as of May 31, 2016, the Company determined that there were control deficiencies that constituted material weaknesses, as described below.

 

1.We do not have an Audit Committee – While not being legally obligated to have an audit committee, it is the management’s view that such a committee, including a financial expert member, is an utmost important entity level control over the Company’s financial statement. Currently the Board of Directors acts in the capacity of the Audit Committee, and does not include a member that is considered to be independent of management to provide the necessary oversight over management’s activities.

 

2.We did not maintain appropriate cash controls – As of May 31, 2015, the Company has not maintained sufficient internal controls over financial reporting for the cash process, including failure to segregate cash handling and accounting functions, and did not require dual signature on the Company’s bank accounts. Alternatively, the effects of poor cash controls were mitigated by the fact that the Company had limited transactions in their bank accounts.

 

3.We did not implement appropriate information technology controls – As at May 31, 2015, the Company retains copies of all financial data and material agreements; however there is no formal procedure or evidence of normal backup of the Company’s data or off-site storage of data in the event of theft, misplacement, or loss due to unmitigated factors.

 

Accordingly, the Company concluded that these control deficiencies resulted in a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis by the company’s internal controls.

 

As a result of the material weaknesses described above, management has concluded that the Company did not maintain effective internal control over financial reporting as of May 31, 2016 based on criteria established in Internal Control- Integrated Framework issued by COSO.

 

 24 

 

 

System of Internal Control over Financial Reporting

 

Although our Company is unable to meet the standards under COSO because of the limited funds available to a company of our size and stage of development, we are committed to improving our financial organization. As funds become available, we will undertake to: (1) create a position to  segregate duties consistent with control objectives, (2) increase our personnel resources and technical accounting expertise within the accounting function (3) appoint one or more outside directors to our board of directors who shall be appointed to the audit committee of our Company resulting in a fully functioning audit committee who will undertake the oversight in the establishment and monitoring of required internal controls and procedures; and (4) prepare and implement sufficient written policies and checklists which will set forth procedures for accounting and financial reporting with respect to the requirements and application of US GAAP and SEC disclosure requirements.

 

We will continue to monitor and evaluate the effectiveness of our internal controls and procedures and our internal controls over financial reporting on an ongoing basis and are committed to taking further action and implementing additional enhancements or improvements, as necessary and as funds allow.  However, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within our Company have been detected.  These inherent limitations include the realities that judgments in decision making can be faulty and that breakdowns can occur because of simple error or mistake. The design of any system of controls is based in part on 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.  Projections of any evaluation of controls effectiveness to future periods are subject to risks.

 

Changes in Internal Control over Financial Reporting

 

There has been no change in our internal control over financial reporting identified in connection with our evaluation we conducted of the effectiveness of our internal control over financial reporting as of May 31, 2016, that occurred during our fourth fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

 

This annual report does not include an attestation report of the Company’s registered public accounting firm regarding internal control over financial reporting. Management’s  report was not subject to attestation by the Company’s registered public accounting firm pursuant to temporary rules of the SEC that permit the Company to provide only management’s report in this annual report.

 

Item 9B. Other Information.

 

None.

 

PART III

 

Item 10. Directors, Executive Officers, Promoters and Control Persons of the Company

 

DIRECTORS AND EXECUTIVE OFFICERS

 

The name, age and titles of our sole officer and director are as follows:

 

Name and Address of 
Executive
Officer and/or Director
  Age   Position
Shu Feng Lu    43   President, Director, and Chairman of the Board
         
Teng Fei Ma   27   CEO, CFO, Secretary, and Treasurer

 

 25 

 

 

Shu Feng Lu, President, Director, and Chairman of the Board

 

Date of Birth

29 October 1973

 

Education

Diploma Holder, Xin Yang Guang Bo Dian Shi University, China

 

Working Experience

2008 to 2011: Equity Partner, Jie Da International Jewelry Limited

-The Company is engaged in the trading of jewelry

2011 to 2015:  Chairman, He Nan Jin Wan Hong Shi Ye Company Limited

-The Company is engaged in production of tea products and proprietary trading of securities

 

 26 

 

 

Teng Fei Ma, General Manager, CEO, CFO, Secretary, and Treasurer

 

Date of birth

6 April 1989

 

Education

Undergraduate Degree in Electronic Information Science and Technology, Henan Industrial University, China

 

Working Experience

Oct 2009 to Nov 2012: Admin Manager, Xing Tai Life Insurance Company Limited, China

  - The Company is engaged in life insurance business in China

 

Nov 2012 to Feb 2014: Training Manager, Qian Hai Life Insurance Company Limited, China

  - The Company is engaged in life insurance business in China

 

  - Ma is responsible for training life insurance agents

 

Feb 2014 to Jan 2015: IPO Department Head, Qian Hai Stock Exchange, China

  - The Company is operating as a stock exchange in Qian Hai district of Shenzhen, China

 

Jan 2015 till now:  General Manager, Shenzhen Qian Hai Jin Wan Hong Asset Management Company Limited, China

  - The Company is engaged in asset management business.

 

AUDIT COMMITTEE

 

We do not have an audit committee financial expert. We do not have an audit committee financial expert because we believe the cost related to retaining a financial expert at this time is prohibitive. Further, because we have no operations, at the present time, we believe the services of a financial expert are not warranted.

 

SIGNIFICANT EMPLOYEES

 

We have no employees. We intend to hire employees on an as needed basis.

 

Item 11. Executive Compensation

 

The following tables set forth certain information about compensation paid, earned or accrued for services by our President, and Secretary (collectively, the “Named Executive Officers”) for 2014 and 2015:

 

There are no current employment agreements between the company and its officers. The compensation discussed herein addresses all compensation awarded to, earned by, or paid to our named executive officer. There are no other stock option plans, retirement, pension, or profit sharing plans for the benefit of our officers and directors other than as described herein.

 

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

 

The following table sets forth certain information concerning the number of shares of our common stock owned beneficially as of Feb. 13, 2014 by: (i) each person (including any group) known to us to own more than five percent (5%) of any class of our voting securities, (ii) our director, and or (iii) our officer.  Unless otherwise indicated, the stockholder listed possesses sole voting and investment power with respect to the shares shown.

 

 27 

 

 

Title of Class  Name and Address of
Beneficial Owner
   Amount and Nature of 
Beneficial Ownership
   Percentage 
                
Common Stock            

 

The percent of class is based on 8,100,000 shares of common stock issued and outstanding as of the date of this annual report.

 

Item 13. Certain Relationships and Related Transactions

 

During the year ended May 31, 2015, we had not entered into any transactions with our sole officer or director, or persons nominated for these positions, beneficial owners of 5% or more of our common stock, or family members of these persons wherein the amount involved in the transaction or a series of similar transactions exceeded the lesser of $120,000 or 1% of the average of our total assets for the last three fiscal years.

 

Item 14. Principal Accountant Fees and Services 

 

During fiscal year ended May 31, 2016, we incurred approximately $7,250 in fees to our principal independent accountants for professional services rendered in connection with the audit of our May 31, 2015 financial statements and for the reviews of our financial statements for the quarters ended August 31, 2015, November 30, 2015, and February 28, 2016.

 

PART IV

 

Item 15. Exhibits

 

The following exhibits are included as part of this report by reference:

 

23.1   Consent of Independent Registered Public Accounting Firm
     
31.1    Certification of Chief Executive and Financial Officer pursuant to Securities Exchange Act of 1934 Rule 13a-14(a) or 15d-14(a).
     
32.1    Certifications pursuant to Securities Exchange Act of 1934 Rule 13a-14(b) or 15d-14(b) and 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 Taxonomy Extension Definition Linkbase Document
     
101.LAB*   XBRL Taxonomy Extension Label Linkbase Document
     
101.PRE*   XBRL Taxonomy Extension Presentation Linkbase Document

 


*To be filed by amendment

 

 28 

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized in China on October 27, 2016.

 

JIN WAN HONG INTERNATIONAL HOLDINGS LIMITED
   
By: /s/ Teng Fei Ma  
  Name: Teng Fei Ma  
  Title: Principal Executive, Financial and Accounting Officer,
     
    (Principal Executive, Financial and Accounting Officer)

 

 29