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 June 30, 2018

 

or

 

¨ 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: 333-206450

 

AJIA INNOGROUP HOLDINGS, LTD.

(Name of registrant in its charter)

  

Nevada				82-1063313
(State or jurisdiction of incorporation or organization)				(IRS Employer Identification No.)

 

1980 Festival Plaza Drive Suite 530

Las Vegas, NV 89135

(Address of principal executive offices)

 

Phone: (702) 360-0652

(Registrant's telephone number, including area code)

 

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 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 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 last 90 days.
		Yes  x  No  ¨

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-K (§229.405 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  ¨  No  x

  

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter)  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, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer		¨		Accelerated filer	¨
Non-accelerated filer		¨		Smaller reporting company	x
				Emerging Growth Company	x

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

 

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

 

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant's most recently completed second fiscal quarter. Not available

 

APPLICABLE ONLY TO CORPORATE ISSUERS:

 

As of June 30, 2018 the registrant had 10,270,000 issued and outstanding shares of common stock.

 

 

Ajia Innogroup Holdings, LTD.

TABLE OF CONTENTS

 

PART I
ITEM 1.	Business		4
ITEM 1A.	Risk Factors		6
ITEM 1B.	Unresolved Staff Comments		9
ITEM 2.	Properties		9
ITEM 3.	Legal Proceedings		9
ITEM 4.	Mine Safety Disclosures		9
PART II
ITEM 5.	Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities		10
ITEM 6.	Selected Financial Data		11
ITEM 7.	Management's Discussion and Analysis of Financial Condition and Results of Operations		11
ITEM 7A.	Quantitative and Qualitative Disclosures About Market Risk		13
ITEM 8.	Financial Statements and Supplementary Data		F-1
ITEM 9.	Changes In and Disagreements with Accountants on Accounting and Financial Disclosure		14
ITEM 9A.	Controls and Procedures		14
ITEM 9B.	Other Information		15
PART III
ITEM 10.	Directors, Executive Officers, and Corporate Governance		16
ITEM 11.	Executive Compensation		18
ITEM 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters		19
ITEM 13.	Certain Relationships and Related Transactions, and Director Independence		19
ITEM 14.	Principal Accounting Fees and Services		20
PART IV
ITEM 15.	Exhibits, Financial Statement Schedules		21
	Signatures		22

 

2

  

Forward-Looking Statements

 

This report includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities and Exchange Act of 1934, as amended. All statements other than statements of historical facts are “forward-looking statements” for purposes of these provisions, including any projections of earnings, revenues or other financial items, any statement of the plans and objectives of management for future operations, any statements concerning proposed new products or strategic arrangements, any statements regarding future economic conditions or performance, and any statement of assumptions underlying any of the foregoing. In some cases, forward-looking statements can be identified by the use of terminology such as “may,” “will,” “expects,” “plans,” “anticipates,” “estimates,” “potential,” “intends”, or “continue” or the negative thereof or other comparable terminology. Although the Company and its management believe that the expectations reflected in the forward-looking statements contained herein are reasonable, there can be no assurance that such expectations or any of the forward-looking statements will prove to be correct, and actual results could differ materially from those projected or assumed in the forward-looking statements. The Company’s future financial condition and results of operations, as well as any forward-looking statements, are subject to inherent risks and uncertainties, including but not limited to the Risk Factors set forth under Item 1A, and for the reasons described elsewhere in this report. All forward-looking statements and reasons why results may differ included in this report are made as of the date hereof, and we assume no obligation to update these forward-looking statements or reasons why actual results might differ.

 

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PART I

 

Item 1. Business

 

Overview

 

Business Development

 

Ajia Innogroup Holdings, LTD.(the “Company”) was incorporated in the State of Nevada on March 19, 2014, and our fiscal year end is June 30. The Company's administrative address is 1980 Festival Plaza Drive Suite 530, Las Vegas, NV 89135. The telephone number is: (702) 360-0652.

 

On June 14, 2017, Ms. Yin Ling (Elaine) Wan was appointed as President, Chief Executive Officer, Chief Financial Officer, Treasurer, Secretary and member of our Board of Directors of our company. On June 14, 2017, Omri Revivo resigned as President, Chief Executive Officer, Chief Financial Officer, Treasurer, Secretary and member of our Board of Directors of our company.

 

On November 24, 2017 the Board of Directors accepted the resignation of Ms. Yin Ling (Elaine) Wan as Chief Executive and Chief Financial Officer of the Company. At the same time, the Board elected the following individuals to the following positions: Mr. Zhi Qiang Liang was elected as President, Chief Executive Officer and Director; Mr. Wai Hing (Samuel) Lai was elected as Chief Financial Officer; Shun Ching (Dickson) Wong was elected as a Director; Ms. Sin Kei (Stella) Hui was elected as a Director; Ms. Kiu Chung (Jacqueline) Tang was elected as Chief Operating Officer; Mr. Jeffrey Steward Firestone was elected as Director and Vice President of Investor Relations; Dr. Kwai Lam (Terence) Wong was elected as Vice President of Investor Relations and Ms. Yin Ling (Elaine) Wan was elected as Director, Secretary and Treasurer.

 

On December 1, 2017, the Company exchanged 3,000,000 shares of its common stock for a ten percent (10%) ownership interest in a collection code project ("Project"), the purpose of which is to improve the marketability and market penetration of Alipay Network Technology Co., Ltd. ("Alipay") collection code system. Alipay is a PRC company. The ownership interest will be acquired through the Company’s wholly owned subsidiary, Guangzhou Shengjia Trading Co., Ltd., a corporation organized under the laws of PRC. However, as disclosed in the 8K submitted on April 30, 2018, Shengjia has replaced its 10% interest in the Alipay payment code business development project (“Alipay Project”), announced on December 7, 2017, with a 30% interest in Renhai’s new China Mobile project. Renhai has recently reached an agreement with China Mobile Communications Corporation (“China Mobile”) whereby Renhai and China Mobile are to sign an agreement appointing Renhai as one of China Mobile’s marketers in promoting China Mobile’s business products for the period from April 1, 2018 to September 30, 2018. This replacement was because there was a change in the PRC regulations and practices that had negatively impacted the financial performance of the Alipay Project

 

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Business Plan

 

On December 1, 2017, the Company acquired a ten percent (10%) ownership interest in a collection code project ("Project"), the purpose of which is to improve the marketability and market penetration of Alipay Network Technology Co., Ltd. ("Alipay") collection code system. The Company plans to acquire additional interest in this project as the project develops.

 

In addition to the Alipay collection code project, the Company is planning to acquire a business in the development of self-help photo kiosks, which is to be implemented at major convenient locations, such as shopping mall, buildings nearby subway station, etc. to attract customers to use the service. Arising from the growing needs of identity verification and photos for official processing of formal permit applications (e.g. such as driving license, individual identification card, passport and visa application, and etc.), this new business will implement innovative photo kiosks in major locations in cities to provide economic and convenient self-help service. This type of mini photo kiosks provides a one stop self-help service center to allow the customers to apply varieties of permits through a simple process from the identity verification, photo taking, document scanning, electronic signature to making payment.

 

The management will have further announcements when there are further developments in these new business opportunities in the future.

 

Principal Products, Services and Their Markets

 

In last year, our business plan was to create a website and an independent mobile application that enabled consumers to find the best performers, entertainers, bands, speakers and event services easily and which are expected to be accessible for everyone in the United States and Canada. Nevertheless, the management attempts to invest in other IT project and considers acquiring the self-help photo kiosks (and other new business opportunities in the future).

 

Status of Publicly Announced New Products or Services

 

Ajia currently has no new publicly announced products or services.

 

Competitive Business Conditions and Strategy; Ajia’s Position in the Industry

 

Ajia intends to establish itself as a competitive company in the market for event planners. Ajia’s main competitors are firms offering similar services.

 

Patents, Trademarks, Licenses, Agreements or Contracts

 

There are no aspects of our business plan which require a patent, trademark, or product license. We have not entered into any vendor agreements or contracts that give or could give rise to any obligations or concessions.

 

Governmental Controls, Approval and Licensing Requirements

 

None

 

Research and Development Activities and Costs

 

We have spent no time on specialized research and development activities, and have no plans to undertake any research or development in the future.

   

Number of Employees

 

There is one employee for the Company, responsible for the accounting and general administrative matters. In addition, the Company outsources its financial and management matters to various management consultants during the year.

 

Place of Operation

 

Our executive and operating office is located at Unit 301-302, 3/F, Austin Tower, 152 Austin Road, Tsim Sha Tsui, Kowloon, Hong Kong. Our management team is located at this office and will have to travel to China regularly to pursue the development of its businesses.

 

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Item 1A. Risk Factors

 

An investment in these securities involves a high degree of risk and is speculative in nature. In addition to the other information regarding the Company contained in this Prospectus, you should consider many important factors in determining whether to purchase Shares. Following are what we believe are material risks related to the Company and an investment in the Company. Investors are urged to perform their own due diligence, with the help of their investment, accounting, legal and/or other professionals and to make an independent decision regarding an investment in the Shares.

 

RISKS ASSOCIATED WITH OUR BUSINESS

 

Our independent auditors have issued an audit opinion for Ajia which includes a statement describing our going concern status. Our financial status creates a doubt whether we will continue as a going concern.

 

As described in Note B of our accompanying financial statements, our auditors have issued a going concern opinion regarding the Company. This means there is substantial doubt we can continue as an ongoing business for the next twelve months. The financial statements do not include any adjustments that might result from the uncertainty regarding our ability to continue in business. As such, we may have to cease operations and investors could lose part or all of their investment in the Company.

 

We lack an operating history and have losses which we expect to continue into the future. There is no assurance our future operations will result in profitable revenues. If we cannot generate sufficient revenues to operate profitably, we may suspend or cease operations.

 

We were incorporated on March 19, 2014, and we have not fully developed our proposed business operations and have realized no revenues. We have no operating history upon which an evaluation of our future success or failure can be made. Our net loss for the years ended June 30, 2018 and 2017, was $266,097 and $49,639, respectively, most of which is for professional fees. Our ability to achieve and maintain profitability and positive cash flow is dependent upon:

 

·

Completion of the share offering,

 

·

Our ability to attract customers who will use our services,

 

·

Our ability to generate revenue through the sale of our services.

 

Based upon current plans, we expect to incur operating losses in future periods because we will be incurring expenses and not generating revenues. We cannot guarantee that we will be successful in generating revenues in the future. In the event the Company is unable to generate revenues, it may be required to seek additional funding. Such funding may not be available, or may not be available on terms which are beneficial and/or acceptable to the Company. In the event the Company cannot generate revenues and/or secure additional financing, the Company may be forced to cease operations and investors will likely lose some or all of their investment in the Company.

 

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Although we obtain clients or customers, there is no assurance that we will make a profit.

 

Even if we obtain clients or customers for our services, there is no guarantee that we will develop products and/or services that our clients/customers will want to use. If we are unable to attract enough customers/clients to purchase services (and any products we may develop or sell) it will have a negative effect on our ability to generate sufficient revenue from which we can operate or expand our business. The lack of sufficient revenues will have a negative effect on the ability of the Company to continue operations and it could force the Company to cease operations.

 

Some of our competitors have significantly greater financial and marketing resources than we do.

 

There exists in our industry many competitors that have significantly greater financial and marketing resources than do we. There are no assurances that our efforts to compete in the marketplace will be successful. We are a relatively late entry into a mature market for electronic concierge services and applications. There can be no assurance that we will be able to develop a profitable niche in this market.

 

We are in a competitive market which could impact our ability to gain market share which could harm our financial performance.

 

The business of an application providing a comprehensive entire package of event planning and concierge services is very competitive. Barriers to entry on the Internet are relatively low, and we face competitive pressures from companies anxious to join this niche. There are a number of successful websites operated by proven companies that offer similar niche social networking to event planning service which may prevent us from gaining enough market share to become successful. These competitors have existing customers that may form a large part of our targeted client base, and such clients may be hesitant to switch over from already established competitors to our service. If we cannot gain enough market share, our business and our financial performance will be adversely affected.

 

We do not have any additional source of funding for our business plans and may be unable to find any such funding if and when needed, resulting in the failure of our business.

 

Other than the shares offered, no other source of capital has been identified or sought. As a result we do not have an alternate source of funds. If we do find an alternative source of capital, the terms and conditions of acquiring such capital may result in dilution and the resultant lessening of value of the shares of stockholders. As widely reported, the global and domestic financial markets have been extremely volatile in recent months. If such conditions and constraints continue or if there is no investor appetite to finance our specific business, we may not be able to acquire additional financing through credit markets or equity markets. Even if additional financial is available, it may not be available on terms favorable to us. At this time, we have not identified or secured sources of additional financing. Our failure to secure additional financing when it becomes required will have an adverse effect on our ability to remain in business.

 

If we are not successful in raising sufficient fund, we will be faced with several options:

 

1. abandon our business plans, cease operations and go out of business;

 

2. continue to seek alternative and acceptable sources of capital; or

 

3. bring in additional capital that may result in a change of control.

 

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We possess minimal capital, which may severely restrict our ability to develop our services. If we are unable to raise additional capital, our business will fail.

 

We possess minimal capital and must limit the amount of marketing we can perform with respect to our services. We feel we require a minimum of $12,500 to provide sufficient capital to commence with operations and development of the business plan. Our business plan contemplates the development of a website and associated software to assist users to find local events, performers, bands and speakers. Our limited marketing activities may not attract enough clients to generate sufficient revenue to operate profitably, expand our services, implement our business plan or continue operating our business. Our limited marketing capabilities may have a negative effect on our business and may cause us to limit or cease our business operations which could result in investors losing some or all of their investment in the Company.

 

If our estimates related to future expenditures are erroneous or inaccurate, our business will fail and you could lose your entire investment.

 

Our success is dependent in part upon the accuracy of our management’s estimates of our future cost expenditures for legal and accounting services (including those we expect to incur as a publicly reporting company), for website marketing and development expenses, and for administrative expenses, which management estimates to be approximately between $25,000 and $45,000 over the next twelve months. If such estimates are erroneous or inaccurate, or if we encounter unforeseen costs, we may not be able to carry out our business plan, which could result in the failure of our business and the loss of your entire investment.

 

Our auditor has raised substantial doubts about our ability to continue as a going concern and if we are unable to continue our business, our shares may have little or no value.

 

The company’s ability to become a profitable operating company is dependent upon its ability to generate revenues and/or obtain financing adequate to fulfill its research and market introduction activities, and achieving a level of revenues adequate to support our cost structure has raised substantial doubts about our ability to continue as a going concern. We plan to attempt to raise additional equity capital by selling shares and, if necessary, through one or more private placement or public offerings.

 

However, the doubts raised, relating to our ability to continue as a going concern, may make our shares an unattractive investment for potential investors. These factors, among others, may make it difficult to raise any additional capital.

 

Because we are currently considered a “shell company” within the meaning of Rule 12B-2 pursuant to the Securities Exchange Act of 1934, the ability of holders of our common stock to sell their shares may be limited by applicable regulations.

 

We are currently considered a “shell company” as that term is defined in Rule 12b-2 pursuant to the Securities Exchange Act of 1934 and Rule 405 pursuant to the Securities Act of 1933, in that we currently have nominal operations and nominal assets other than cash. Accordingly, the ability of holders of our common stock to sell their shares may be limited by applicable regulations.

 

As a result of our classification as a “shell company”, our investors are not allowed to rely on the “safe harbor” provisions of Rule 144 promulgated pursuant to the Securities Act of 1933 so as not to be considered underwriters in connection with the sale of securities until one year from the date that we cease to be a “shell company.” Additionally, as a result of our classification a shell company:

 

·

Investors should consider shares of our common stock to be significantly risky and illiquid investments.

 

·

We may not register our securities on Form S-8 (an abbreviated form of registration statement).

 

·

Our ability to attract additional funding to sustain our operations may be limited significantly.

 

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We can provide no assurance or guarantee that we will cease to be a “shell company” and, accordingly, we can provide no assurance or guarantee that there will be a liquid market for our shares. Accordingly, investors may not be able to sell our shares and lose their investments in the Company.

  

Item 1B. Unresolved Staff Comments.

 

As of June 30, 2018 there are no unresolved Staff Comments

 

Item 2. Properties.

 

Ajia’s corporate address is 1980 Festival Plaza Drive Suite 530, Las Vegas, NV 89135. Phone: (702) 360-0652 for administrative purposes. Our executive and operating office is located at Unit 301-302, 3/F, Austin Tower, 152 Austin Road, Tsim Sha Tsui, Kowloon, Hong Kong.

 

Item 3. Legal Proceedings.

 

We are not involved in any pending legal proceeding nor are we aware of any pending or threatened litigation against us.

 

Item 4. Mine Safety Disclosures.

 

Not Applicable

 

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PART II

 

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

 

Market For Common Equity

 

No public market currently exists for shares of our common stock. We intend to contact a market maker to file an application on our behalf to have our common stock listed for quotation on the Over-the-Counter Bulletin Board. Of the 10,270,000 shares of common stock outstanding as of June 30, 2018, 4,148,296 shares are restricted shares and may only be resold in compliance with Rule 144 of the Securities Act of 1933. As of the date of this Report, we have one (1) stockholder. We have no outstanding shares of common stock or any other securities to which we have granted registration rights.

 

Dividend Policy

 

The Company does not anticipate paying dividends on the Common Stock at any time in the foreseeable future. The Company’s Board of Directors currently plans to retain earnings for the development and expansion of the Company’s business. Any future determination as to the payment of dividends will be at the discretion of the Board of Directors of the Company and will depend on a number of factors including future earnings, capital requirements, financial conditions and such other factors as the Board of Directors may deem relevant.

 

Rule 144 Shares

 

All of the presently outstanding shares of common stock are “restricted securities” as defined under Rule 144 promulgated under the Securities Act and may only be sold pursuant to an effective registration statement or an exemption from registration, if available. Rule 144, as amended, is an exemption that generally provides that a person who has satisfied a six month holding period for such restricted securities may sell, within any three month period, provided the Company is current in its reporting obligations under the Exchange Act, and subject to certain manner of resale provisions, an amount of restricted securities which does not exceed the greater of 1% of a company’s outstanding common stock or the average weekly trading volume in such securities during the four calendar weeks prior to such sale.

 

Rule 144 is not available for either a reporting or non-reporting shell company unless the company: (1) has ceased to be a shell company; (2) is subject to the Exchange Act reporting obligations; (3) has filed all required Exchange Act reports during the preceding twelve months; and (4) at least one year has elapsed from the time the company filed with the SEC, current Form 10 type information reflecting its status as an entity that is not a shell company.

 

As of the date of this Prospectus, no shares of our common stock are available for sale under Rule 144.

 

Reports

 

Following the effective date of the Registration Statement, we are subject to certain reporting requirements and will furnish annual financial reports to our stockholders, certified by our independent accountants, and will furnish un-audited quarterly financial reports in our quarterly reports filed electronically with the SEC. All reports and information filed by us can be found at the SEC website, www.sec.gov. We do not expect to file a Form 8-A on a pre-effective basis. Because we will not be registered under the Exchange Act, our reporting requirements will be limited.

 

Under Section 15(d) of the Exchange Act, we are not required to file periodic reports if we have less than 300 holders of record for the fiscal year after the year this registration statement becomes effective. Additionally, we will not be subject to the Commission’s proxy, tender offer, and short swing insider trading rules for Section 12 registration and we may not have an ongoing periodic reporting obligation, depending on our number of shareholders.

 

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Transfer Agent

 

Our Transfer Agent is:

 

Quicksilver Stock Transfer

1980 Festival Plaza Dr., Ste 530

Las Vegas, NV 89135

www.qstransfer.com

(702) 629-1883

 

Securities Authorized for Issuance under Equity Compensation Plans:

 

The Company does not have any equity compensation plans.

 

Recent Sales of Unregistered Securities:

 

None

 

Item 6. Selected Financial Data.

 

The Index to Financial Statements and Schedules appears on page 14.

 

The Report of Independent Registered Public Accounting Firm appears on page F-1, and the Financial Statements and Notes to Financial Statements appear beginning on page F-2.

 

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

 

This section of the Prospectus includes a number of forward-looking statements that reflect our current views regarding the future events and financial performance of Ajia

 

Overview

 

We qualify as an “emerging growth company” under the JOBS Act. As a result, we are permitted to, and intend to, rely on exemptions from certain disclosure requirements. For so long as we are an emerging growth company, we will not be required to:

 

·

have an auditor report on our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act;

 

·

comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis);

 

·

submit certain executive compensation matters to shareholder advisory votes, such as “say-on-pay” and “say-on-frequency;” and

 

·

disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the CEO’s compensation to median employee compensation.

 

In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of the benefits of this extended transition period. Our financial statements may therefore not be comparable to those of companies that comply with such new or revised accounting standards.

 

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We will remain an “emerging growth company” for up to five years, or until the earliest of (i) the last day of the first fiscal year in which our total annual gross revenues exceed $1 billion, (ii) the date that we become a “large accelerated filer” as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value of our ordinary shares that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter or (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three year period.

 

Comparison of the Years Ended June 30, 2018 and 2017

 

Operating Expenses

 

The Company’s operating expenses for the years ended June 30, 2018 and 2017 were $310,677 and 49,639 respectively. Operating expenses in June 30, 2018 consisted of professional fees of $105,314 and general and administrative expense $146,376. Operating expenses in June 30, 2017 consisted of professional fees of $29,171 and general and administrative expense $20,468.

 

Net Loss

 

During the year ended June 30, 2018 and 2017 the Company recognized net losses of $266,097 and $49,639.

 

Liquidity and Capital Resources

 

At June 30, 2018 and 2017, we had current assets of $6,184 and $820 which consisting of cash and cash equivalents and prepaid expenses. At June 30, 2018 and 2017, our total current liabilities were $140,281 and $7,055 respectively consisting of accrued expenses and due to related party.

 

Historically, we have financed our cash flow and operations from the sale of common stock and loan from related party. Net cash provided by financing activities for the year ended June 30, 2018 was $113,681, which consist of proceeds for common stock issued. During the year ended June 30, 2017 net cash provided by financing activities was $9,000, which consists of common stock to be issued.

 

On July 10, 2017, we entered into subscription agreements to sell 20,000 restricted shares of common stock to two private investors for $10,000 ($0.50 per share). The funds will be used for general corporate purposes including the payment of professionals and other service providers. The sale of the shares was arranged outside the United States and was made to two non-United States persons. We relied on the exemption from registration provided by Regulation S.

 

We have not yet generated net profits from our operations. We will require additional funds to fully implement our plans. These funds may be raised through equity financing, debt financing, or other sources, which may result in the dilution in the equity ownership of our shares. We currently do not have any arrangements for additional financing and we may not be able to obtain financing when required. Our future is dependent upon our ability to obtain financing, a successful marketing and promotion program and, further in the future, achieving a profitable level of operations. The issuance of additional equity securities by us could result in a significant dilution in the equity interests of our current stockholders. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities and future cash commitments. We will require additional funds to maintain our reporting status with the SEC and remain in good standing with the state of Nevada.

 

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Cash Requirements

 

There is no historical financial information about us on which to base an evaluation of our performance. We are a development stage company and have not generated much revenue from operations. We cannot guarantee we will be successful in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources, possible delays in developing our website, and possible cost overruns due to the price and cost increases in supplies and services.

 

While the officer and director has generally indicated a willingness to provide services and financial contributions if necessary, there are presently no agreements, arrangements, commitments, or specific understandings, either verbally or in writing, between the officer and director and Ajia. During the first year of operations, our officer and director will also provide his labor at no charge.

 

If we are unable to meet our needs for cash from either the money that we raise from our offering, or possible alternative sources, then we may be unable to continue, develop, or expand our operations.

 

We have no plans to undertake any product research and development during the next twelve months. There are also no plans or expectations to acquire or sell any plant or plant equipment in the first year of operations.

 

Off-Balance Sheet Arrangements

 

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 is material to investors.

 

Ajia Innogroup Holdings, LTD.has never been in bankruptcy or receivership.

 

Office

 

Ajia has an administrative office is located at 1980 Festival Plaza Drive Suite 530, Las Vegas, Nevada 89135. The telephone number is: (702) 360-0652 .

 

Item 7A. Quantitative and Qualitative Disclosures about Market Risk.

 

As a smaller reporting company, we are not required to provide information pursuant to this item.

 

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Item 8. Financial Statements and Supplementary Data.

 

AJIA INNOGROUP HOLDINGS, LTD.

(Formerly Wigi4You, Inc.)

 

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

 

		Page
Report of Independent Registered Public Accounting Firm – TOTAL ASIA ASSOCIATES PLT		F-2
Report of Independent Registered Public Accounting Firm –Dov Weinstein & Co. C.P.A. (Isr)		F-3
Consolidated Balance Sheets as of June 30, 2018 and 2017		F-4
Consolidated Statements of Operations and Comprehensive Loss for the Years ended June 30, 2018 and 2017		F-5
Consolidated Statements of Cash Flows for the Years ended June 30, 2018 and 2017		F-6
Consolidated Statement of Changes in Stockholders’ Equity for the Years ended June 30, 2018 and 2017		F-7
Notes to Consolidated Financial Statements		F-8 to F-19

 

F-1

 

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

To The Stockholders and Board of Directors and of

AJIA INNOGROUP HOLDINGS, LTD.

(Formerly Wigi4You, Inc.)

 

Opinion on the Consolidated Financial Statements

 

We have audited the accompanying consolidated balance sheet of Ajia Innogroup Holdings, Ltd and Subsidiaries (the “Company”) as of June 30, 2018, the related consolidated statements of operations and comprehensive (loss) income, cash flows and changes in stockholders’ equity for the year ended June 30, 2018, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of June 30, 2018, and the results of its operations and its cash flows for the year ended June 30, 2018, in conformity with accounting principles generally accepted in the United States of America.

 

Emphasis of Matter

 

As discussed in Note 2 to the consolidated financial statements, during 2018, the Company experienced a net loss of $266,097 and negative cash flows from operations during the year and incurred an accumulated deficit of $333,302 as of June 30, 2018. Management’s plans in regard to this matter are described in Note 2.

 

Basis for Opinion

 

These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

 

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit we are required to obtain an understanding of internal control over financial reporting 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.

 

Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audit provide a reasonable basis for our opinion.

 

/s/ TOTAL ASIA ASSOCIATES PLT

 

We have served as the Company's auditor since 2018.

 

Malaysia

January 16, 2019

 

F-2

Table of Contents

 

REPORT OF THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

To the Board of Directors and Stockholder of

Wigi4you, Inc

 

We have audited the accompanying consolidated balance sheet of Wigi4you, Inc (“the Company”) as of June 30, 2017 and the related consolidated statements of operations, changes in stockholder's deficit and cash flows for the year then ended. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

 

We conducted our audit in accordance with 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 includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

 

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Wigi4you, Inc. as of June 30, 2017 and the results of its operations and cash flows for the period described above in conformity with generally accepted accounting principles in the United States of America.

 

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note B to the financial statements, the Company has not established a source of revenue sufficient to cover its operating costs. As of June 30, 2017 the Company has a working capital deficit and does not have the cash resources sufficient to meet its planned business objectives. These and other factors raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plan regarding these matters is also described in Note B to the financial statements. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

/s/ Dov Weinstein & Co. C.P.A. (Isr)

www.wcpa.co.il

Jerusalem, Israel

September 27, 2017

 

F-3

Table of Contents

 

AJIA INNOGROUP HOLDINGS, LTD.

(Formerly Wigi4You, Inc.)
CONSOLIDATED BALANCE SHEETS

AS OF JUNE 30, 2018 AND 2017

(Currency expressed in United States Dollars (“US$”), except for number of shares)

 

		As of June 30,
		2018				2017
ASSETS
Current assets:
Cash and cash equivalents		$	1,816			$	30
Accounts receivable			2,768				-
Prepayments and other receivables			1,600				790
Total current assets			6,184				820
Non-current assets
Plant and equipment, net			886				-
TOTAL ASSETS		$	7,070			$	820
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Other payables and accrued liabilities		$	36,045			$	6,500
Amount due to a related party			104,236				555
Total current liabilities			140,281				7,055
Commitments and contingencies
Stockholders’ deficit:
Preferred stock, $0.001 par value, 100,000,000 shares authorized; no shares are issued			-
Common stock, $0.001 par value; 500,000,000 and 75,000,000 shares authorized; 10,270,000 and 7,250,000 shares issued and outstanding as of June 30, 2018 and 2017			7,270				7,250
Shares to be cancelled			3,000				-
Additional paid-in capital			189,400				53,720
Accumulated other comprehensive income			421				-
Accumulated deficit			(333,302	)			(67,205	)
Total stockholders’ deficit			(133,211	)			(6,235	)
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT		$	7,070			$	820

 

See accompanying notes to consolidated financial statements.

 

F-4

Table of Contents

 

AJIA INNOGROUP HOLDINGS, LTD.

(Formerly Wigi4You, Inc.)

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

FOR THE YEARS ENDED JUNE 30, 2018 AND 2017

(Currency expressed in United States Dollars (“US$”), except for number of shares)

 

			Years ended June 30,
			2018				2017
Revenues, net			$	105,638			$	-
Cost of revenue				(61,641	)			-
Gross profit				43,997				-
Operating expenses
General and administrative				(146,376	)			(20,468	)
Professional fee				(105,314	)			(29,171	)
Impairment loss on intangible assets				(58,987	)			-
Total operating expenses				(310,677	)			(49,639	)
LOSS FROM OPERATIONS				(266,680	)			(49,639	)
Other income:
Gain from forgiveness of related party loan				580				-
Interest income				3				-
Total other income				583				-
LOSS BEFORE INCOME TAXES				(266,097	)			(49,639	)
Income tax expense				-				-
NET LOSS			$	(266,097	)		$	(49,639	)
Other comprehensive income:
- Foreign currency translation gain				421				-
COMPREHENSIVE LOSS			$	(265,676	)		$	(49,639	)
Net loss per share – Basic and diluted				(0.03	)			(0.01	)
Weighted average common shares outstanding – Basic and diluted				9,011,973				6,795,205

 

See accompanying notes to consolidated financial statements.

 

F-5

Table of Contents

 

AJIA INNOGROUP HOLDINGS, LTD.

(Formerly Wigi4You, Inc.) 

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED JUNE 30, 2018 AND 2017

(Currency expressed in United States Dollars (“US$”))

 

		Years ended June 30,
		2018				2017
Cash flows from operating activities:
Net loss		$	(266,097	)		$	(49,639	)
Adjustment to reconcile net income to net cash used in operating activities
Depreciation and amortization			69,794				-
Impairment loss on intangible assets			58,987				-
Change in operating assets and liabilities:
Account receivable			(2,768	)			-
Prepayments and other receivables			(810	)			(200	)
Other payables and accrued liabilities			29,545				6,500
Net cash used in operating activities			(111,349	)			(43,339	)
Cash flows from investing activities:
Purchase of plant and equipment			(967	)			-
Net cash used in investing activities			(967	)			-
Cash flows from financing activities:
Advances from a director			103,681				-
Proceeds from issuance of common stock			10,000				9,000
Net cash provided by financing activities			113,681				9,000
Effect of exchange rate changes on cash and cash equivalents			421				-
Net change in cash and cash equivalents			1,786				(34,339	)
CASH AND CASH EQUIVALENT, BEGINNING OF YEAR			30				34,369
CASH AND CASH EQUIVALENT, END OF YEAR		$	1,816			$	30
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for income taxes		$	-			$	-
Cash paid for interest		$	-			$	-

 

See accompanying notes to consolidated financial statements.

 

F-6

Table of Contents

 

AJIA INNOGROUP HOLDINGS, LTD. 

(Formerly Wigi4You, Inc.)

CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY

FOR THE YEARS ENDED JUNE 30, 2018 AND 2017

(Currency expressed in United States Dollars (“US$”), except for number of shares)

 

		Common stock								Common stock				Additional				Common				Accumulated other								Total
		No. of shares				Amount				to be cancelled				paid-in capital				stock subscribed				comprehensive  income				Accumulated deficit				stockholders’ deficit
Balance as of July 1, 2016			5,250,000			$	5,250			$	-			$	15,720			$	31,000			$	-			$	(17,566	)		$	34,404
Share application money received			-				-				-				-				9,000				-				-				9,000
Common stock issued for cash			2,000,000				2,000				-				38,000				(40,000	)			-				-				-
Net loss for the year			-				-				-				-				-				-				(49,639	)			(49,639	)
Balance as of June 30, 2017			7,250,000			$	7,250			$	-			$	53,720			$	-			$	-			$	(67,205	)		$	(6,235	)
Balance as of July 1, 2017			7,250,000			$	7,250			$	-			$	53,720			$	-			$	-			$	(67,205	)		$	(6,235	)
Common stock issued			20,000				20				-				9,980				-				-				-				10,000
Shares issued for projects			3,000,000				3,000				-				125,700				-				-				-				128,700
Shares to be cancelled			(3,000,000	)			(3,000	)			3,000				-				-				-				-				-
Net loss for the year			-				-				-				-				-				-				(266,097	)			(266,097	)
Foreign currency translation adjustment			-				-				-				-				-				421				-				421
Balance as of June 30, 2018			7,270,000			$	7,270			$	3,000			$	189,400			$	-			$	421			$	(333,302	)		$	(133,211	)

 

See accompanying notes to consolidated financial statements.

 

F-7

Table of Contents

 

AJIA INNOGROUP HOLDINGS, LTD.

(Formerly Wigi4You, Inc.)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED JUNE 30, 2018 AND 2017

(Currency expressed in United States Dollars (“US$”), except for number of shares)

 

1. ORGANIZATION AND BUSINESS BACKGROUND

 

Ajia Innogroup Holdings, Ltd., formerly “Wigi4you, Inc.” (the “Company” or “AJIA”) was incorporated in the State of Nevada on March 19, 2014. The Company had intended to provide a website and mobile app to assist event planners in locating performers, bands and speakers, booking locations and planning events in areas around the United States and Canada. However, The Company changed its business plan in 2017 and is currently planning to pursue the business in having self-help photo kiosks to be implemented at major convenient locations, such as shopping mall, buildings near subway stations, etc. to attract customers to use the service. In addition, the Company provides system development consulting and training services. The main revenue for these businesses will be generated from the self-help photo kiosks at which one can do photo printing, Wechat printing, game commemorative photos, copying documents, etc., as well as from consulting contracts.

 

On November 24, 2017 the Board of Directors (the “Board”) accepted the resignation of Ms. Elaine Wan as Chief Executive and Chief Financial Officer of the Company. At the same time, the Board elected the following individuals to the following positions: Mr. Chi Qiang Liang was elected as President, Chief Executive Officer and Director of the Company; Mr. Wai Hing Samuel Lai was elected as Chief Financial Officer of the Company; Shun Ching (Dickson) Wong was elected as a Director and a Member of the Audit Committee of the Company; Ms. Sin Kei Stella Hui was elected as a Director and a Member of the Audit Committee; Ms. Kiu Chung Jacqueline Tang was elected as Chief Operating Officer of the Company; Mr. Jeffrey Firestone was elected as Director and Vice President of Investor Relations of the Company; Dr. Kwai Lam Terence Wong was elected as Vice President of Investor Relations and Elaine Wan was elected as Director, Secretary and Treasurer.

 

On December 1, 2017, the Company acquired a ten percent (10%) ownership interest in a collection code project ("Project"), the purpose of which is to improve the marketability and market penetration of Alipay Network Technology Co., Ltd. ("Alipay") collection code system. As a part of the agreement, the Company will share 10% of expenses and profit on the Project (See Note 4).

 

Effective February 9, 2018, the Board accepted the resignation of Jeffrey S. Firestone from his position as Vice President and director of the Company.

 

On April 25, 2018, the Company announced that its wholly owned subsidiary, Guangzhou Shengjia Trading Co., Ltd. of Guangzhou, China (“Shengjia”) has entered into an agreement with Guangzhou Renhai Network Technology Co., Ltd. (“Renhai”) in which Shengjia would replace its 10% interest in the Alipay payment code business development project (“Alipay Project”) (See Note 4), with a 30% interest of Renhai’s new China Mobile project. Renhai has recently reached an agreement with China Mobile Communications Corporation (“China Mobile”) whereby Renhai and China Mobile are to sign an agreement appointing Renhai as one of China Mobile’s marketers in promoting China Mobile’s business products for the period from April 1, 2018 to September 30, 2018. Renhai’s China Mobile agreement will be extended once certain business targets are fulfilled.

 

The Company’s activities are subject to significant risks and uncertainties including failing to secure additional funding to operationalize the Company’s website and apps before another company develops similar websites or apps.

 

The details of the Company’s subsidiaries are described below:

 

Name		Place of incorporation and kind of legal entity		Principal activities and place of operation		Particulars of issued/ registered share capital		Effective interest Held
Splendor Radiant Limited		British Virgin Islands, a limited liability company		Investment holding		1 issued shares of US$1 each		100%
A Jia Creative Holdings Limited		Hong Kong, a limited liability company		Provision of system setup and maintenance services, investment holding		100 issued shares of HK$1 each		100%
Guangzhou Shengjia Trading Co., Ltd		The PRC, a limited liability company		Trading business		HK$1,000,000		100%

 

F-8

Table of Contents

 

AJIA INNOGROUP HOLDINGS, LTD.

(Formerly Wigi4You, Inc.)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED JUNE 30, 2018 AND 2017

(Currency expressed in United States Dollars (“US$”), except for number of shares)

 

AJIA and its subsidiaries are hereinafter referred to as (the “Company”).

 

2. GOING CONCERN UNCERTAINTIES

 

The accompanying consolidated financial statements have been prepared using the going concern basis of accounting, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

 

The Company experienced a net loss of $266,097 and negative cash flows from operations during the year and incurred an accumulated deficit of $333,302 as of June 30, 2018. The continuation of the Company as a going concern through June 30, 2019 is dependent upon the continued financial support from its stockholders. Management believes the Company is currently pursuing additional financing for its operations. However, there is no assurance that the Company will be successful in securing sufficient funds to sustain the operations.

 

These and other factors raise substantial doubt about the Company’s ability to continue as a going concern. These consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets and liabilities that may result in the Company not being able to continue as a going concern.

 

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

·	Basis of presentation

 

These accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”).

 

·	Use of estimates

 

In preparing these consolidated financial statements, management makes estimates and assumptions that affect the reported amounts of assets and liabilities in the balance sheets and revenues and expenses during the years reported. Actual results may differ from these estimates.

 

·	Basis of consolidation

 

The consolidated financial statements include the financial statements of AJIA and its subsidiaries. All significant inter-company balances and transactions within the Company have been eliminated upon consolidation.

 

·	Cash and cash equivalents

 

Cash and cash equivalents are carried at cost and represent cash on hand, demand deposits placed with banks or other financial institutions and all highly liquid investments with an original maturity of three months or less as of the purchase date of such investments.

 

·	Plant and equipment

 

F-9

Table of Contents

  

AJIA INNOGROUP HOLDINGS, LTD.

(Formerly Wigi4You, Inc.)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED JUNE 30, 2018 AND 2017

(Currency expressed in United States Dollars (“US$”), except for number of shares)

 

Plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses, if any. Depreciation is calculated on the straight-line basis over the following expected useful lives from the date on which they become fully operational and after taking into account their estimated residual values:

 

	Expected useful lives
Computer equipment	5 years

 

Expenditures for repairs and maintenance are expensed as incurred. When assets have been retired or sold, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in the results of operations.

 

Depreciation expense for the years ended June 30, 2018 and 2017 were $81 and $0, respectively.

 

·	Impairment of long-lived assets

 

In accordance with the provisions of ASC Topic 360, “Impairment or Disposal of Long-Lived Assets”, all long-lived assets such as plant and equipment and intangible assets held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is evaluated by a comparison of the carrying amount of an asset to its estimated future undiscounted cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amounts of the assets exceed the fair value of the assets. There has been no impairment charge for the years presented.

 

·	Revenue recognition

 

The Company’s revenue recognition policies are in compliance with FASB ASC 605-35 “Revenue Recognition”. Revenue is recognized when a formal arrangement exists, the price is fixed or determinable, all obligations have been performed pursuant to the terms of the formal arrangement and collectability is reasonably assured.

 

For the Company’s self-serve kiosks, revenue is recognized when each kiosk satisfies the performance obligation by transferring control of the promised goods or services to the customer.

 

For the Company’s business in catering system development and training, monthly revenue is recognized when the Company satisfies its obligation by transferring control of the promised goods or performance of services to the customer.

 

The Company recognizes revenues on sales of its services, based on the terms of the customer agreement. The customer agreement takes the form of either a contract or a customer purchase order and each provides information with respect to the service being sold and the sales price. If the customer agreement does not have specific delivery or customer acceptance terms, revenue is recognized at the time the service is provided to the customer.

 

·	Comprehensive income or loss

 

ASC Topic 220, “Comprehensive Income” establishes standards for reporting and display of comprehensive income or loss, its components and accumulated balances. Comprehensive income or loss as defined includes all changes in equity during a period from non-owner sources. Accumulated comprehensive income or loss, as presented in the accompanying consolidated statement of stockholders’ deficit consists of changes in unrealized gains and losses on foreign currency translation. This comprehensive income or loss is not included in the computation of income tax expense or benefit.

 

F-10

Table of Contents

 

AJIA INNOGROUP HOLDINGS, LTD.

(Formerly Wigi4You, Inc.)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED JUNE 30, 2018 AND 2017

(Currency expressed in United States Dollars (“US$”), except for number of shares)

 

·	Income taxes

 

The provision for income taxes is determined in accordance with the provisions of ASC Topic 740, “Income Taxes” (“ASC 740”). Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Any effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

 

ASC 740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements uncertain tax positions taken or expected to be taken on a tax return. Under ASC 740, tax positions must initially be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions must initially and subsequently be measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and relevant facts.

 

The Company did not have any unrecognized tax positions or benefits and there was no effect on the financial condition or results of operations for the years ended June 30, 2018 and 2017. The Company and its subsidiaries are subject to local and various foreign tax jurisdictions. The Company’s tax returns remain open subject to examination by major tax jurisdictions.

 

·	Net loss per share

 

The Company calculates net loss per share in accordance with ASC Topic 260 “Earnings per Share”. Basic loss per share is computed by dividing the net loss by the weighted-average number of common shares outstanding during the period. Diluted loss per share is computed similar to basic loss per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common stock equivalents had been issued and if the additional common shares were dilutive.

 

·	Foreign currencies translation

 

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 transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the statement of operations.

 

The reporting currency of the Company is United States Dollars ("US$"). The Company’s subsidiaries operating in Hong Kong and the PRC maintained their books and records in their local currency, Hong Kong Dollars ("HK$") and Renminbi Yuan (“RMB”), which are functional currencies as being the primary currency of the economic environment in which these entities operate.

 

In general, for consolidation purposes, assets and liabilities of its subsidiaries whose functional currency is not the US$ are translated into US$, in accordance with ASC Topic 830-30, “Translation of Financial Statement”, using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements of foreign subsidiaries are recorded as a separate component of accumulated other comprehensive income within the statement of stockholders’ equity.

 

Translation of amounts from its reporting currencies into US$ has been made at the following exchange rates for the respective year:

 

		2018				2017
Year-end HK$:US$1 exchange rate			7.8464				-
Annual average HK$:US$1 exchange rate			7.8000				-
Year-end RMB:US$1 exchange rate			6.6210				-
Annual average RMB:US$1 exchange rate			6.5047				-

 

F-11

Table of Contents

 

AJIA INNOGROUP HOLDINGS, LTD.

(Formerly Wigi4You, Inc.)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED JUNE 30, 2018 AND 2017

(Currency expressed in United States Dollars (“US$”), except for number of shares)

 

·	Pension cost

 

Contributions to retirement schemes (which are defined contribution plans) are charged to general and administrative expenses in the statements of operation and comprehensive income as and when the related employee service is provided.

 

·	Related parties

 

Parties, which can be a corporation or individual, are considered to be related if the Company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Companies are also considered to be related if they are subject to common control or common significant influence.

 

·	Concentration of credit risk

 

The Company is subject to credit risk through its accounts receivable consisting primarily of amounts due from franchisees for royalty income, and other products. The financial condition of these franchisees is largely dependent upon the underlying business trends of our brands and market conditions within the vending industry. This concentration of credit risk is mitigated, in part, by the large number of franchisees spread over a large geographical area and the short-term nature of the receivables.

 

·	Fair value of financial instruments

 

The carrying value of the Company’s financial instruments: cash and cash equivalents, prepayments and other receivables, accounts payable, amount due to a related party, other payables and accrued liabilities approximate at their fair values because of the short-term nature of these financial instruments.

 

The Company also follows the guidance of the ASC Topic 820-10, “Fair Value Measurements and Disclosures” ("ASC 820-10"), with respect to financial assets and liabilities that are measured at fair value. ASC 820-10 establishes a three-tier fair value hierarchy that prioritizes the inputs used in measuring fair value as follows:

 

·	Level 1 : Observable inputs such as quoted prices in active markets;

 

·	Level 2 : Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and

 

·	Level 3 : Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions

 

Fair value estimates are made at a specific point in time based on relevant market information about the financial instrument. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates.

 

·	Recent accounting pronouncements

 

In July 2015, FASB issued ASU 2015-11, “Inventory (Topic 330) Related to Simplifying the Measurement of Inventory,” which applies to all inventory except that which is measured using last-in, first-out (“LIFO”) or the retail inventory method. Inventory measured using first-in, first-out (“FIFO”) or average cost is within the scope of the new guidance and should be measured at the lower of cost and net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable cost of completion, disposal, and transportation. Subsequent measurement is unchanged for inventory measured using LIFO or the retail inventory method. The amendments are effective for public business entities for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. The new guidance is applied prospectively, and earlier application is permitted as of the beginning of an interim or annual reporting period. The Company adopted ASU 2015-11 effective July 1, 2017, which had no material impact on its consolidated financial statements or financial statement disclosures.

 

F-12

Table of Contents

  

AJIA INNOGROUP HOLDINGS, LTD.

(Formerly Wigi4You, Inc.)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED JUNE 30, 2018 AND 2017

(Currency expressed in United States Dollars (“US$”), except for number of shares)

 

In January 2017, the Financial Accounting Standards Board (the “FASB”) issued new guidance for goodwill impairment which requires only a single-step quantitative test to identify and measure impairment and record an impairment charge based on the excess of a reporting unit’s carrying amount over its fair value. The option to perform a qualitative assessment first for a reporting unit to determine if a quantitative impairment test is necessary does not change under the new guidance. This guidance is effective for the Company beginning in fiscal year 2020 with early adoption permitted. The Company adopted this guidance in fiscal year 2017. The adoption of this guidance will had no impact on the Company’s consolidated financial statements.

 

In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash (“ASU 2016-18”). ASU 2016-18 requires that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and restricted cash. Therefore, amounts generally described as restricted cash should be included with cash and cash equivalents when reconciling the beginning of period and end of period total amounts shown on the statement of cash flows, and transfers between cash and cash equivalents and restricted cash are no longer presented within the statement of cash flows. ASU 2016-18 is effective for annual periods beginning after December 15, 2017, including interim periods within those fiscal years. The Company elected to early adopt ASU 2016-18 for the reporting period ended December 31, 2017 and the standard was applied retrospectively for all periods presented which had no material impact on prior years. As a result of the adoption of ASU 2016-18, the Company no longer presents the change within restricted cash in the consolidated statement of cash flows.

 

In March 2016, the Financial Accounting Standards Board (the “FASB”) issued new guidance for employee share-based compensation which simplifies several aspects of accounting for share-based payment transactions, including excess tax benefits, forfeiture estimates, statutory tax withholding requirements, and classification in the statements of cash flows. This guidance was effective for the Company in fiscal year 2017. Under the new guidance any future excess tax benefits or deficiencies are recorded to the provision for income taxes in the consolidated statements of operations, instead of additional paid-in capital in the consolidated balance sheets. During the years ended June 30, 2018 and 2017, no excess tax benefits were recorded to additional paid-in capital that would have been recorded as a reduction to the provision for income taxes.

 

In February 2016, the FASB issued ASU No. 2016-02 (“ASU 2016-02”), Leases (Topic 842) , which supersedes existing guidance on accounting for leases in Leases (Topic 840) and generally requires all leases, including operating leases, to be recognized in the statement of financial position as right-of-use assets and lease liabilities by lessees. The provisions of ASU 2016-02 are to be applied using a modified retrospective approach and are effective for reporting periods beginning after December 15, 2018; early adoption is permitted. In July 2018, the FASB issued ASU 2018-10 “Codification Improvements of Topic 842, Leases ” and ASU No. 2018-11,“ Leases (Topic 842 ): Targeted Improvements.” ASU 2018-11 provides companies another transition method in addition to the existing transition method by allowing entities to initially apply the new leases standard at the adoption date and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. The consideration in the contract is allocated to the lease and nonlease components on a relative standalone price basis (for lessees) or in accordance with the allocation guidance in the new revenue standard (for lessors). ASU 2018-11 also provides lessees with a practical expedient, by class of underlying asset, to not separate nonlease components from the associated lease component. If a lessee makes that accounting policy election, it is required to account for the nonlease components together with the associated lease component as a single lease component and to provide certain disclosures. Lessors are not afforded a similar practical expedient. The Company is evaluating the effect ASU 2016-02, 2018-10 and 2018-11 will have on its consolidated financial statements and disclosures and has not yet determined the effect of the standard on its ongoing financial reporting at this time.

 

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AJIA INNOGROUP HOLDINGS, LTD.

(Formerly Wigi4You, Inc.)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED JUNE 30, 2018 AND 2017

(Currency expressed in United States Dollars (“US$”), except for number of shares)

 

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”). ASU 2014-09 requires an entity to recognize the revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods and services. ASU 2014-09 supersedes the revenue requirements in

 

Revenue Recognition (Topic 605) and most industry-specific guidance throughout the Industry Topics of the Codification. The New Revenue Standard provides for a single comprehensive principles-based standard for the recognition of revenue across all industries through the application of the following five-step process:

 

Step 1: Identify the contract(s) with a customer.

Step 2: Identify the performance obligations in the contract.

Step 3: Determine the transaction price.

Step 4: Allocate the transaction price to the performance obligations in the contract.

Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation.

 

This five-step process will require significant management judgment in addition to changing the way many companies recognize revenue in their financial statements. Additionally, and among other provisions, the New Revenue Standard requires expanded quantitative and qualitative disclosures, including disclosure about the nature, amount, timing and uncertainty of revenue.

 

In August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date (“ASU 2015-14”), which defers the effective date of ASU 2014-09 by one year. Early adoption is permitted but not before the original effective date. The Company’s adoption of ASU 2014-09 will change the timing of the recognition of initial franchise fees. ASU 2014-09 requires these fees to be recognized over the term of the related franchise license for the respective robot, which had a material impact to revenue recognized for initial franchise fees and renewal franchise fees. ASU 2014-09, allows for non-cancellable franchise contract agreements for the Company recognize revenue under the provisions of ASC 606-10-25, Revenue Recognition – Revenue from Contracts with Customers.

 

In March 2016, FASB issued ASU 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. The amendments in this update change the accounting for certain stock-based compensation transactions, including the income tax consequences and cash flow classification for applicable transactions. The amendments in this update are effective for annual periods beginning after December 31, 2016 and interim periods within those annual periods. The Company is currently evaluating the impact that this amendment will have on its consolidated financial statements.

 

In February 2016, FASB issued ASU 2016-02, “Leases.” This standard requires the recognition of all lease transactions with terms in excess of 12 months on the balance sheet as a lease liability and a right-of-use asset (as defined in the standard). ASU 2016-02 will be effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with earlier application permitted. Upon adoption, the lessee will apply the new standard retrospectively to all periods presented or retrospectively using a cumulative effect adjustment in the year of adoption. ASU 2016-02 is not expected to have a material impact on the Company’s consolidated financial statements or consolidated financial statement disclosures upon adoption based on current facts and circumstances.

 

Effective January 2017, FASB issued ASU No. 2016-15 “Statement of Cash Flows” (Topic 230). This guidance clarifies diversity in practice on where in the Statement of Cash Flows to recognize certain transactions, including the classification of payment of contingent consideration for acquisitions between Financing and Operating activities. We are currently evaluating the impact that this amendment will have on our consolidated financial statements.

 

On January 5, 2017, the FASB issued ASU No. 2017-01, “Clarifying the Definition of a Business” (Topic ASC 805), guidance to clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The amendments in this ASU provide a screen to determine when an integrated set of assets and activities (collectively referred to as a “set”) is not a business. The screen requires that when substantially all of the fair value of the gross assets acquired (or disposed of) is concentrated in a single identifiable asset or a group of similar identifiable assets, the set is not a business. This screen reduces the number of transactions that need to be further evaluated. If the screen is not met, the amendments require that to be considered a business, a set must include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create output and remove the evaluation of whether a market participant could replace the missing elements.

 

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AJIA INNOGROUP HOLDINGS, LTD.

(Formerly Wigi4You, Inc.)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED JUNE 30, 2018 AND 2017

(Currency expressed in United States Dollars (“US$”), except for number of shares)

 

This ASU is effective for public business entities in annual periods beginning after December 15, 2017, including interim periods therein. We are currently evaluating the impact that this amendment will have on our consolidated financial statements.

 

In May 2017, the FASB issued ASU No. 2017-09, “Compensation – Stock Compensation” (Topic 718) - Scope of Modification Accounting. This ASU clarifies when to account for a change to the terms or conditions of a share-based payment award as a modification. Under the new guidance, modification accounting is required only if the fair value, the vesting conditions, or the classification of the award (as equity or liability) changes as a result of the change in terms or conditions. This ASU is effective prospectively for the annual period ending December 31, 2018 and interim periods within that annual period. We are currently evaluating the impact that this amendment will have on our consolidated financial statements.

 

In August 2018, the FASB issued ASU 2018-13, “ Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement ”, which adds disclosure requirements to Topic 820 for the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. The Company is evaluating the provisions of this ASU and plans to adopt this ASU effective July 1, 2020.

 

The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and does not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations.

 

4. COLLABORATIVE AGREEMENT

 

As part of the arrangement with Renhai, the Company exchanged 3,000,000 shares representing 30% of the Company’s common stock at the time of issuance for a ten percent (10%) ownership interest in the Project for a fair value of $128,700 estimated using a discounted future cash flow valuation model. The significant assumptions are the discount rate of 24% and a term of 4 years. The assumptions represent managements best estimate based on the information available.

 

The total value of common shares of $128,700 is being amortized over the expected measurement period through December 1, 2020. As of June 30, 2018, $10,725 of amortization has been recorded and the unamortized fair value has been recorded as an intangible asset, which was fully impaired.

 

This arrangement has been superseded by the agreement with Guangzhou Renhai Network Technology Co., Ltd. subsequent to the end of the period.

 

On April 25, 2018, the Company announced that its wholly owned subsidiary, Guangzhou Shengjia Trading Co., Ltd. of Guangzhou, China (“Shengjia”) has entered into an agreement with Guangzhou Renhai Network Technology Co., Ltd., in which Shengjia would replace its 10% interest in the Alipay payment code business development project (“Alipay Project”), with a 30% interest of Renhai’s new China Mobile project. Renhai has recently reached an agreement with China Mobile Communications Corporation (“China Mobile”) whereby Renhai and China Mobile are to sign an agreement appointing Renhai as one of China Mobile’s marketers in promoting China Mobile’s business products for the period from April 1, 2018 to September 30, 2018. Renhai’s China Mobile agreement will be extended once certain business targets are fulfilled. The reason for the replacement is primarily due to significant changes in China’s regulations and practices and these changes have negatively impacted the financial performance of the Alipay Project.

 

Renhai will maintain a 70% interest of the China Mobile project and will be responsible for the management and overall supervision of the project, and Shengjia will carry out various support functions.

 

Subsequently on December 28, 2018, both parties agreed to sign a termination agreement as the estimated revenue of China mobile project within two years is much lower than the expectation. Based on the terms is the agreement, all transactions in relation to the projects are all rescinded and become voided. Renhai shall return the Company’s 3,000,000 shares to the Company for cancellation and the Company shall return all the incomes previously received from Renhai.

 

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AJIA INNOGROUP HOLDINGS, LTD.

(Formerly Wigi4You, Inc.)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED JUNE 30, 2018 AND 2017

(Currency expressed in United States Dollars (“US$”), except for number of shares)

 

The Company cancelled these 3,000,000 shares of common stock on December 28, 2018

 

5. AMOUNT DUE TO A RELATED PARTY

 

As of June 30, 2018 and 2017, amount due to a related party represented temporary advances made by a director of the Company, Ms. WAN Yin Ling, which was unsecured, interest-free with no fixed repayment term.

 

6. INCOME TAXES

 

The Company operates in various countries: United States, British Virgin Island, Hong Kong and the PRC that are subject to taxes in the jurisdictions in which they operate, as follows:

 

United States of America

 

The Company is registered in the State of Nevada and is subject to United States current tax law.

 

British Virgin Island

 

Under the current BVI law, the Company is not subject to tax on income.

 

Hong Kong

 

For the years ended June 30, 2018 and 2017, no provision for Hong Kong Profits Tax is provided for, since the Company’s income neither arises in, nor is derived from Hong Kong under its applicable tax law. The reconciliation of income tax rate to the effective income tax rate based on loss before income taxes from foreign operation for the years ended June 30, 2018 and 2017 are as follows:

 

		Years ended June 30,
		2018				2017
Loss before income taxes		$	(18,787	)		$	-
Statutory income tax rate			16.5	%			16.5	%
Income tax impact at the statutory rate			(3,099	)			-
Non-deductible items			50				-
Deductible items			(109	)			-
Tax loss not recognized as deferred tax			3,158				-
Income tax expense		$	-			$	-

 

As of June 30, 2018, Hong Kong operation generated approximately $3,158 of net operating loss carryforwards for Hong Kong tax purpose at no expiration.

 

The PRC

 

For the years ended June 30, 2018 and 2017, the Company generated no operating result and accordingly, no provision for income tax has been recorded.

 

As of June 30, 2018, the PRC operation incurred $1,241 of net operating losses carryforward available for income tax purposes that may be used to offset future taxable income and will begin to expire in 5 years from the year of incurrence, if unutilized. The Company has provided for a full valuation allowance against the deferred tax assets on the expected future tax benefits from the net operating loss carryforwards as the management believes it is more likely than not that these assets will not be realized in the future.

 

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AJIA INNOGROUP HOLDINGS, LTD.

(Formerly Wigi4You, Inc.)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED JUNE 30, 2018 AND 2017

(Currency expressed in United States Dollars (“US$”), except for number of shares)

 

The following table sets forth the significant components of the aggregate net deferred tax assets of the Company as of June 30, 2018 and 2017:

 

			As of June 30,
			2018				2017
Deferred tax assets:
Net operating loss carryforward from:
– United States of America			$	89,776			$	22,850
– Hong Kong				3,158				-
– The PRC				310				-
Total deferred tax assets				93,244				22,850
Less: valuation allowance				(93,244	)			(22,850	)
Net deferred tax assets			$	-			$	-

 

As of June 30, 2018, the Company incurred $266,097 the aggregate net operating loss carryforwards available to offset its taxable income for income tax purposes. The Company has provided for a full valuation allowance against the deferred tax assets of $93,244 on the expected future tax benefits from the net operating loss carryforwards as the management believes it is more likely than not that these assets will not be realized in the future. For the year ended June 30, 2018, the valuation allowance increased by $93,244, primarily relating to net operating loss carryforwards.

 

7. PENSION COSTS

 

Contributions to retirement schemes (which are defined contribution plans) are charged to general and administrative expenses in the statements of operation and comprehensive income as and when the related employee service is provided.

 

The Company is required to make contribution under a defined contribution pension scheme for all of its eligible employees in Hong Kong. The Company is required to contribute a specified percentage of the participants' relevant income based on their ages and wages level. The total contributions made were $1,768 and $0 for the years ended June 30, 2018 and 2017, respectively

 

8. STOCKHOLDERS’ EQUITY

 

(a) Preferred stock

 

The company was authorized to issue one hundred million (100,000,000) shares of preferred stock, par value $0.001 per share. On June 30, 2018, none of the preferred shares have been issued.

 

(b) Common stock

 

Shares authorized

 

Upon formation, the total number of shares of all classes of stock which the Company was authorized to issue seventy-five million (75,000,000) shares of common stock, par value $0.001 per share. On December 15, 2017, the Company increased its authorized common shares to 500,000,000 shares at par value $0.001 per share.

 

Common stock issued

 

On August 23, 2016, the Company has received $50,000 from investors for 2,000,000 shares of common stock to be issued. The shares were subscribed as per a Registration Statement filed with the SEC to register and sell 2,000,000 shares of newly issued common stock at an offering price of $0.025 per share. The Company issued the shares on September 20, 2016.

 

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AJIA INNOGROUP HOLDINGS, LTD.

(Formerly Wigi4You, Inc.)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED JUNE 30, 2018 AND 2017

(Currency expressed in United States Dollars (“US$”), except for number of shares)

 

On July 10, 2017, Company issued 20,000 share of Common Stock at $0.50 per share for cash proceeds of $10,000.

 

On December 1, 2017, the Company exchanged 3,000,000 shares of its common stock at a value of $128,700 to acquire 10% ownership of the Project (See Note 4). This amount has been recorded as an intangible asset.

 

As of June 30, 2018 and 2017, the Company had a total of 10,270,000 and 7,250,000 shares of its common stock issued and outstanding.

 

Subsequently, 3,000,000 shares of common stocks were cancelled upon the termination of the agreements.

 

9. RELATED PARTY TRANSACTIONS

 

Advances from Director

 

From time to time, a director of the Company advance funds to the Company for working capital purpose. Those advances are unsecured, non-interest bearing and due on demand. The imputed interest on the loan from director was not significant.

 

Free Office Space from its Majority Stockholder

 

The Company has been provided office space by its majority stockholder at no cost. The management determined that such cost is nominal and did not recognize the rent expense in its financial statements.

 

10. CONCENTRATIONS OF RISK

 

The Company is exposed to the following concentrations of risk:

 

(a) Major customers

 

For the year ended June 30, 2018, two customers represented more than 10% of the Company’s revenues. These customers accounted for 89% (58% and 30%) of the Company’s revenues amounting to $90,000 ($60,000 and $30,000 respectively) with $0 of accounts receivable.

 

For the year ended June 30, 2017, there was no customer represented more than 10% of the Company’s revenues.

 

(b) Credit risk

 

Financial instruments that are potentially subject to credit risk consist principally of trade receivables. The Company believes the concentration of credit risk in its trade receivables is substantially mitigated by its ongoing credit evaluation process and relatively short collection terms. The Company does not generally require collateral from customers. The Company evaluates the need for an allowance for doubtful accounts based upon factors surrounding the credit risk of specific customers, historical trends and other information.

 

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AJIA INNOGROUP HOLDINGS, LTD.

(Formerly Wigi4You, Inc.)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED JUNE 30, 2018 AND 2017

(Currency expressed in United States Dollars (“US$”), except for number of shares)

 

(c) Exchange rate risk

  

The reporting currency of the Company is US$, to date the majority of the revenues and costs are denominated in HK$ and a significant portion of the assets and liabilities are denominated in HK$. As a result, the Company is exposed to foreign exchange risk as its revenues and results of operations may be affected by fluctuations in the exchange rate between US$ and HK$.. The Company does not hold any derivative or other financial instruments that expose to substantial market risk.

 

11. COMMITMENTS AND CONTINGENCIES

 

As of June 30, 2018 and 2017, there were no commitments and contingencies involved.

 

12. SUBSEQUENT EVENTS

 

In accordance with ASC Topic 855, “Subsequent Events”, which establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued, the Company has evaluated all events or transactions that occurred after June 30, 2018 up through the date the Company issued the audited consolidated financial statements. During the period, the Company did not have any material recognizable subsequent events.

 

On December 28, 2018, the Company’s subsidiary, Guangzhou Shengjia Trading Co., Ltd. of Guangzhou, China (“Shengjia”), has entered into with Guangzhou Renhai Network Technology Co., Ltd. (“Renhai”) whereby the Company shall share 10% interest in Renhai’s Alipay payment code business development project (“Alipay Project”) with the consideration of the Company’s 3,000,000 shares.

 

Due to the change in the PRC regulations, the Company subsequently announced on December 28, 2018 that the said 10% interest in Alipay Project was replaced by 30% interest in Renhai’s project with China Mobile Communications Corporation (“China Mobile”).

 

Nevertheless, even with the above remedies, the returns from the projects are still not satisfied by the Company’s management and are far below the estimations made from Renhai to the Company. In this regard, both parties agree that the agreements between Shengia and Renhai are rescinded and voided. Renhai shall return the Company’s 3,000,000 shares to the Company for cancellation and the Company shall return all the incomes previously received from Renhai.

 

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

 

There are none.

 

Item 9A. Controls and Procedures.

 

Evaluation of Disclosure Controls and Procedures

 

The Director and the Chief Executive Officer of the Company handles all aspects of the company.

 

On November 24, 2017 the Board of Directors accepted the resignation of Ms. Yin Ling (Elaine) Wan as Chief Executive and Chief Financial Officer of the Company. At the same time, the Board elected the following individuals to the following positions: Mr. Zhi Qiang Liang was elected as President, Chief Executive Officer and Director; Mr. Wai Hing (Samuel) Lai was elected as Chief Financial Officer; Shun Ching (Dickson) Wong was elected as a Director; Ms. Sin Kei (Stella) Hui was elected as a Director; Ms. Kiu Chung (Jacqueline) Tang was elected as Chief Operating Officer; Mr. Jeffrey Steward Firestone was elected as Director and Vice President of Investor Relations; Dr. Kwai Lam (Terence) Wong was elected as Vice President of Investor Relations and Ms. Yin Ling (Elaine) Wan was elected as Director, Secretary and Treasurer.

 

Changes in Internal Control over Financial Reporting

 

There were no changes in the Company's internal control over financial reporting during the year ended June 30, 2018 that have materially impacted, or are reasonably likely to materially impact, the Company’s internal control over financial reporting.

 

Management's Annual Report on Internal Control over Financial Reporting

 

Management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934). Internal control over financial reporting is a process designed by, or under the supervision of the Company’s Chief Executive Officer and the Director and implemented by the Company’s Board of Directors, management and other personnel, 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 of America (“GAAP”).

 

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The Company’s internal control over financial reporting includes those policies and procedures that: i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that receipts and expenditures of the Company are made only in accordance with authorizations of management and directors of the Company; and iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material impact on the financial statements.

 

The Company’s management, including the Director and the Chief Executive Officer, does not expect that the Company’s disclosure controls and procedures, or the Company’s internal controls over financial reporting, will necessarily prevent all fraud and material errors. An internal control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations on all internal control systems, the Company’s internal control system can provide only reasonable assurance of achieving its objectives and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the 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 a simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of any system of internal control is also based in part upon certain assumptions about the likelihood of future events, and can provide only reasonable, not absolute, assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in circumstances, or because the degree of compliance with the policies and procedures may deteriorate.

 

Management of the Company, including the Director and Chief Executive Officer, conducted an evaluation of the effectiveness of the Company's internal control over financial reporting as of June 30, 2018 and determined that controls are ineffective due to the Company’s small size and lack of segregation of duties.

 

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

 

Item 9B. Other Information.

 

None.

 

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Part III

 

Item 10. Directors, Executive Offices and Corporate Governance

 

Our directors are elected by the stockholders to a term of one year and serves until his or her successor is elected and qualified. Our officer is appointed by the board of directors (the “Board”) to a term of one year and serves until his or her successor is duly elected and qualified, or until he or she is removed from office. The Board has no nominating, audit or compensation committees.

 

Omri Revivo has held the position of Director and officer since March 19, 2014. Mr. Revivo has extensive experience in catering and event planning. He also has extensive experience in social and corporate matters, particularly in large-scale event planning, preparation, logistics and production. From 2010 through 2015, he served as a Catering Sales and Service Manager for Happy-Time Events of Israel. While working for Happy-Time, he oversaw all aspects of high-profile and large-scale social and corporate events, including preparation of function space contracts, proposing menus based on function type, size and budget, negotiating and contracting with outside vendors, such as florists, party rental companies, temporary staffing companies and audio visual vendors.

 

On June 14, 2017, Elaine Wan Yin Ling was appointed as President, Chief Executive Officer, Chief Financial Officer, Treasurer, Secretary and member of our Board of Directors of our company. On June 14, 2017, Omri Revivo resigned as President, Chief Executive Officer, Chief Financial Officer, Treasurer, Secretary and member of our Board of Directors. of our company.

 

On November 24, 2017, Mr. Zhi Qiang Liang was elected as President, Chief Executive Officer and Director; Mr. Wai Hing (Samuel) Lai was elected as Chief Financial Officer; Shun Ching (Dickson) Wong was elected as a Director; Ms. Sin Kei (Stella) Hui was elected as a Director; Ms. Kiu Chung (Jacqueline) Tang was elected as Chief Operating Officer; Mr. Jeffrey Steward Firestone was elected as Director and Vice President of Investor Relations; Dr. Kwai Lam (Terence) Wong was elected as Vice President of Investor Relations and Ms. Yin Ling (Elaine) Wan was elected as Director, Secretary and Treasurer.

 

The persons named above are expected to hold their offices/positions until the next annual meeting of our stockholders. The officer and director set forth herein is our only officer, director, promoter and control person, as that term is defined in the rules and regulations promulgated under the Securities and Exchange Act of 1933.

 

No executive officer or director of the corporation has been the subject of any order, judgment, or decree of any court of competent jurisdiction, or any regulatory agency permanently or temporarily enjoining, barring, suspending or otherwise limiting him or her from acting as an investment advisor, underwriter, broker or dealer in the securities industry, or as an affiliated person, director or employee of an investment company, bank, savings and loan association, or insurance company or from engaging in or continuing any conduct or practice in connection with any such activity or in connection with the purchase or sale of any securities.

 

No executive officer or director of the corporation has been convicted in any criminal proceeding (excluding traffic violations) or is the subject of a criminal proceeding which is currently pending.

 

No executive officer or director of the corporation is the subject of any pending legal proceedings.

 

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Elaine Wan Yin Ling (Director)

 

Elaine Wan, graduated from the University Of Management & Technology in Arlington, Virginia in 2010. Ms. Wan currently has been the Director of Full Yick International Limited located in Hong Kong since May of 2018. Prior to her position she was Director at On Chi Ceramic Technology Limited in Hong Kong since 2014 and continues to serve as a Director. She is also director of Jiayu Insurance Finance Limited in Hong Kong since 2017 and Director of Shine Spread Limited in Hong Kong since 2007.

 

Ms. Wan has extensive experience in managing and consulting and will be great asset to our company.

 

Liang, Zhiqing (Director, CEO and President)

 

Mr. Liang was graduated from the College of life science, South China Normal University. In 2004, he worked in Chinese Researcher of Easy Care. From 2005 to 2006, he was the China Asia Pacific Operation Director of Joyful (which is an Hong Kong listed company). From Feb. to Apr. 2006, he was the China Market Department Director of Watsons (which is an Hong Kong listed company). He was then the Business Manager and the Director of the Internet Business Department in GuangDong E-serve United Co., Ltd ( which is an state-owned company). From 2017 to 2018, he was the Marketing Manager of GuangDong GW E-Commerce Limited by Share Ltd (which is state-owned third party payment company). From 2012 to 2018, he was the Domestic Marketing Consultant and Executive Director of Hong Kong GoFun Holding. In the meantime, from 2016 to 2018 and from 2017 to 2018, he was CEO of Guangzhou Parameters Information & Tech Co., Ltd and the partner of GuangDong Federal Vehicle Network Tech Ltd (which is state-owned) respectively.

 

Mr. Wai Hing Lai ("Samuel") - CFO

 

He obtained Hon. Diploma in Accountancy from Lingnan University (formerly known as Lingnan College) in 1993. Samuel completed the joint examination lodged by ACCA/HKSA in 1996 and has become the Fellow Member of ACCA presently. He has been a senior manager at three major accounting firms in Hong Kong and Singapore, specializing in tax planning and international taxation from 1995 to 2002. In addition, he has worked for a number of financial enterprises and exchange listed companies in Hong Kong, including Foxconn International Holdings Limited and Pico Far East Holdings Limited. He was the Group Financial Controller of a Singapore listed company, China Sky Chemical Fibre Co Limited. Since 2012, he has been working for the International Professional Consultants Corporation of Hong Kong as its Vice President, advising on listing issues and group restructuring.

 

Audit Committee

 

We do not currently have an audit committee or a committee performing similar functions. Our Board of Directors as a whole participates in the review of financial statements and disclosure.

 

Code of Ethics

 

We have not adopted a code of ethics that applies to our officer, director and employee. When we do adopt a code of ethics, we will disclose it in a Current Report on Form 8-K.

 

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Item 11. Executive Compensation

 

The following table sets forth for the years ended June 30, 2018 and 2017, the compensation awarded to, paid to, or earned by, our officer and director.

 

Name and principal position		Year		Salary ($)				Bonus ($)				Stock Awards ($)				Option Awards ($)				Non-Equity Incentive Plan Compensation ($)				Nonqualified Deferred Compensation Earnings ($)				All Other Compensation				Total ($)
Omri Revivo, former sole officer and director		2018			—				—				—				—				—				—				—				—
Omri Revivo, former sole officer and director		2017			—				—				—				—				—				—				—				—
Liang, Zhiqiang		2018
Elaine Wan Yin Ling, director		2018			—				—				—				—				—				—				—				—

 

Currently, of our officer and director is being not compensated for his services during the development stage of our business operations, and is not considered to be an employee of the Company.

 

We have not paid any salaries in 2018, and we do not anticipate paying any salaries at any time in 2018. We will not begin paying salaries until we have adequate funds to do so.

 

Any out-of-pocket expenses incurred by our officer and director shall accrue as a liability of the Company and shall be reimbursed when sufficient funds are available. In the future we may approve payment of salaries for our officers and directors, but currently, no such plans have been approved. We also do not currently have any benefits, such as health insurance, life insurance or any other benefits available to our employees.

 

We have not issued any stock options or maintained any stock option or other incentive plans since our inception. We have no plans in place and have never maintained any plans that provide for the payment of retirement benefits or benefits that will be paid primarily following retirement including, but not limited to, tax qualified deferred benefit plans, supplemental executive retirement plans, tax-qualified deferred contribution plans and nonqualified deferred contribution plans. Similarly, we have no contracts, agreements, plans or arrangements, whether written or unwritten, that provide for payments to the named executive officers or any other persons following, or in connection with the resignation, retirement or other termination of a named executive officer, or a change in control of us or a change in a named executive officer’s responsibilities following a change in control.

 

As of the date hereof, we have not entered into an employment contract with our sole officer and do not intend to enter into one until such time as it profitable to do so. The officer is not considered to be an employee.

 

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Compensation of Directors

 

Our director has not received any compensation for serving as such, for serving on committees of the Board of Directors or for special assignments. During the years ended June 30, 2018 and 2017, there were no other arrangements between us and our directors that resulted in our making payments to our directors for any services provided to us by them as director.

 

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

 

The following table sets forth, as of the date of this Prospectus, the total number of shares owned beneficially by each of our directors, officers and key employees, individually and as a group, and the present owners of 5% or more of our total outstanding shares. The stockholders listed below have direct ownership of their shares and possess sole voting and dispositive power with respect to the shares.

 

Title of Class		Name of Beneficial Owner  (1)		Amount and Nature of Beneficial Ownership  (2)				Percent of Class  (3)
Common		Elaine Wan Yin Ling			3,930,796				38.27	%
Common		Liang, Zhiqiang			217,500				2.12	%
Common		Directors and Officers as a Group (1 individual)			4,148,296				40.39	%

 

(1)	The person named above may be deemed to be a "parent" and "promoter" of the Company, within the meaning of such terms under the Securities Act of 1933, as amended, by virtue of his direct holdings in the Company.

 

(2)	Each shareholder owns his or her shares directly.

 

(3)	Based on 10,270,000 shares issued and outstanding as of June 30, 2018.

 

Future sales by existing stockholders

 

A total of 4,148,296 shares of common stock were issued to our officers and directors, all of which are restricted securities, as defined in Rule 144 of the Rules and Regulations of the SEC promulgated under the Securities Act. As we are a “shell company,” Rule 144 would not be available for the resale of restricted securities by our stockholders until we have complied with the requirements of Rule 144(i).

 

Item 13. Certain Relationships and Related Transactions, and Director Independence

 

Security Ownership of Certain Beneficial Owners and Management

 

On February 19, 2015, 5,250,000 shares of Ajia’s common stock were issued to one shareholder.

 

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Director Independence

 

Our Board of Directors has determined that it does not have a member that is “independent” as the term is used in Item 7(d) (3) (iv) of Schedule 14A under the Exchange Act.

 

Item 14. Principal Accounting Fees and Services

 

The aggregate professional fees paid to our registered public accounting firm for its annual audit and quarterly reviews during the year ended June 30, 2018 and 2017 were as follows:

 

		June 30, 2018				June 30, 2017
Audit Fees and Audit Related Fees		$	57,080			$	12,500
Tax Fees							—
All Other Fees							—
TOTAL		$	57,080			$	12,500

 

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Part IV

 

Item 15. Exhibits, Financial Statement Schedules

 

The following exhibits are included with this registration statement filing:

 

Exhibit Number		Exhibit Description
31.1		Certification of the Chief Executive Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2		Certification of the Chief Financial Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1		Certification of the Chief Executive Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2		Certification of the  Chief Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

  

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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, thereto duly authorized.

 

		AJIA INNOGROUP HOLDINGS, LTD.
		(Registrant)
Dated: January 16, 2019		/s/ Mr. Zhi Qiang Liang
		Mr. Zhi Qiang Lian
		Chief Executive Officer

 

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 

Dated: January 16, 2019		/s/ Mr. Zhi Qiang Liang
		Mr. Zhi Qiang Lian
		Chief Executive Officer
		/s/ Ms. Yin Ling WAN
Dated: January 16, 2019		Ms. Yin Ling WAN
		Director, Secretary and Treasurer
		/s/ Mr. Shun Ching WONG
Dated: January 16, 2019		Ms. Yin Ling WAN
		Independent Director
		/s/ Ms. Sin Kei Stella HUI
Dated: January 16, 2019		Ms. Sin Kei Stella HUI
		Independent Director
		Audit Committee

 

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