UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
Form
10-K/A
Amendment
No. 2
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x
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ANNUAL
REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
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For
the fiscal year ended October 31, 2008
OR
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o
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TRANSITION
REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
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For the
transition period from_____________ to _____________.
Commission
file number 0-24512
RENHUANG
PHARMACEUTICALS, INC.
(Exact
name of registrant as specified in its charter)
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Nevada
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88-1273503
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(State
or other jurisdiction of
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(I.R.S.
Employer
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incorporation
or organization)
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Identification
No.)
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No.
218, Taiping, Taiping District
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Harbin,
Heilongjiang Province,
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P.R.
China
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100016
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(Address
of principal executive offices)
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(Zip
Code)
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Registrant’s
telephone number, including area code +86-451-5762-0378
Securities
registered pursuant to Section 12(b) of the Act: None
Securities
registered pursuant to Section 12(g) of the Act:
Common
Stock, par value $0.001
(Title of
class)
Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act. Yes o No x
Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or 15(d) of the Act. Yes o 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 o No x
Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (229.405 of this
chapter) during the preceeding 12 months (or for such shorter period that the
registrant was required to submit and post such files). Yes o No o
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. o
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 definition of “accelerated filer, large accelerated
filer and smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check
one):
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Large
accelerated filer
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Accelerated
filer
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Non-accelerated
filer
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Smaller
reporting company x
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(Do
not check if a smaller reporting company)
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Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Act). Yes o No x
Aggregate
market value of the voting stock held by non-affiliates: $14,228,511 as based on
sales price of $0.825 per share of such stock on April 30, 2008. The voting
stock held by non-affiliates on that date consisted of 17,246,680 shares of
common stock.
As of
November 23, 2009, there were 37,239,536 shares of common stock, par value
$0.001, issued and outstanding.
Renhuang
Pharmaceuticals, Inc. (the “Company”) is filing this Amendment No. 2 to Annual
Report on Form 10-K for the year ended October 31, 2008 with the Securities and
Exchange Commission (the “SEC”) to clarify under Item 9A(T)-Controls and
Procedures the reasons why as of October 31, 2008, that its disclosure controls
and procedures and internal control over financial reporting were not
effective.
ITEM
9A(T) – CONTROLS AND PROCEDURES
Disclosure
Controls and Procedures
We
conducted an evaluation, with the participation of our Chief Executive Officer
and Principal Accounting Officer, of the effectiveness of the design and
operation of our disclosure controls and procedures, as defined in Rules
13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended,
or the Exchange Act, as of October 31, 2008, to ensure that information required
to be disclosed by us in the reports filed or submitted by us under the Exchange
Act is recorded, processed, summarized and reported, within the time periods
specified in the SEC’s rules and forms, including to ensure that
information required to be disclosed by us in the reports filed or submitted by
us under the Exchange Act is accumulated and communicated to our management,
including our Chief Executive Officer and Principal Accounting Officer, or
persons performing similar functions, as appropriate to allow timely decisions
regarding required disclosure. We did not file our quarterly reports
on Form 10-Q for the quarters ended January 31, 2008, April 30, 2008 and July
31, 2008 during the fiscal year ended October 31, 2008. These Form
10-Qs were filed in January, 2010. In addition, we were late filing
our annual report on Form 10-K for the year ended October 31, 2008, and filed an
amendment to such Form 10-K to restate fiscal 2008 financial statements due to
the misstatement of sales rebates. Based on that evaluation,
our Chief Executive Officer and Principal Accounting Officer have concluded that
as of October 31, 2008, our disclosure controls and procedures were not
effective.
Internal
Control over Financial Reporting
Management,
under the supervision of our chief executive officer and chief financial
officer, is responsible for establishing and maintaining adequate internal
control over financial reporting. Internal control over financial
reporting (as defined in Rules 13a-15(f) and 15d(f) under the Exchange Act)
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 generally accepted accounting principles in the
United States, or GAAP. Internal control over financial reporting
includes those policies and procedures that (a) pertain to the maintenance
of records that, in reasonable detail, accurately and fairly reflect the
transactions and dispositions of assets, (b) provide reasonable assurance
that transactions are recorded as necessary to permit preparation of financial
statements in accordance with GAAP, (c) provide reasonable assurance that
receipts and expenditures are being made only in accordance with appropriate
authorization of management and the board of directors, and (d) provide
reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use or disposition of assets that could have a material effect on
the financial statements. A “material weakness” is a deficiency, or a
combination of deficiencies, in internal control over financial reporting such
that there is a reasonable possibility that a material misstatement of the
registrant’s annual or interim financial statements will not be prevented or
detected on a timely basis by the company’s internal controls. A
“significant deficiency” is a deficiency, or a combination of deficiencies, in
internal control over financial reporting that is less severe than a material
weakness, yet important enough to merit attention by those responsible for
oversight of the registrant’s financial reporting. A “deficiency” in
internal control over financial reporting exists when the design or operation of
a control does not allow management or employees, in the normal course of
performing their assigned functions, to prevent or detect misstatements on a
timely basis.
During
our review of our financial statements and results for the year ended October
31, 2008, our management, under the supervision and with the participation of
our chief executive officer and chief financial officer, assessed the
effectiveness of our internal control over financial reporting.
2
As of
October 31, 2008, we deemed the following material weaknesses:
· We
have not yet completed documentation of controls placed in operation to
adequately address our financial reporting risks. Accordingly, we
have not yet had the opportunity to assess the effectiveness of our procedures
to determine whether our internal control over financial reporting is
effective.
· As
discussed above, in light of our failure to timely file our periodic reports for
fiscal 2008, we did not believe that our disclosure controls and procedures were
effective at October 31, 2008.
· We
incorrectly calculated the amount of sales rebates paid to our sales agents for
the year ended October 31, 2008. As a result we were required to
restate our financial statements for the year ended October 31,
2008.
Because
of the forgoing, management has concluded that we did not maintain effective
internal control over financial reporting as of October 31, 2008.
This
Annual Report does not include an attestation report of our independent
registered public accounting firm regarding internal control over financial
reporting. Management’s report was not subject to attestation by our
independent registered public accounting firm pursuant to temporary rules of the
SEC that permit us to provide only management’s report in this Annual
Report.
Remediation
of Weaknesses
Management
recognizes the importance of these weaknesses and is committed to remediation
and will institute a comprehensive remediation plan. The plan will
include, but not be limited to, hiring finance management resources and
personnel with knowledge and experience in U.S. GAAP, and where necessary, the
plan will utilize the services of external consulting professionals in the area
of accounting advisory services. In this regard, subsequent to 2008
fiscal year end, in January 2010, we hired a new chief financial officer who is
experienced with U.S. GAAP and SEC reporting. Further, management intends to
allocate resources to insure that reports are filed on a timely basis in the
future.
Changes
in Internal Controls
Since the
third quarter of our 2009 fiscal year, we have begun the implementation of some
of the remedial measures described above, including hiring of a new chief
financial officer in January 2010, additional staff, engaging consultants,
training our staff, implementing more rigorous policies and procedures relating
to period-end financial reporting, journal-entry approval, supporting
documentation, and account reconciliations which affects our internal
controls. We expect to continue to implement additional financial and
management controls, reporting systems and procedures.
SIGNATURES
Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
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Renhuang
Pharmaceuticals, Inc.
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Dated:
February 4, 2010
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/s/
Shaoming Li
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By:
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Shaoming
Li
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Chairman,
President and
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Chief
Executive Officer
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Dated:
February 4, 2010
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/s/
Yan Yi Chen
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By:
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Yan
Yi Chen
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Chief
Financial
Officer
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