UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q10-Q/A

(Amendment No. 1)

(Mark One)

orFor the quarterly period ended December 31, 2017

For the transition period from __________ to __________

Commission file number:333-206097

ADDENTAX GROUP CORP.

(Exact name of registrant as specified in its charter)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [  ]

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). [X] Yes [  ] No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or 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.

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)

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS. Yes [  ] No [X]

Check whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court.

APPLICABLE ONLY TO CORPORATE ISSUERS

IndicateState the number of shares outstanding of each of the issuer’s classes of common stock,equity, as of the latest practicable date.date: 506,920,000 common shares par value $0.001, issued and outstanding as of November 20, 2017.April 16, 2018.

EXPLANATORY NOTE

Addentax Group, Corp. (“Addentax”, the “Company”, “we” or “us”) is filing this Amendment No. 1 to our quarterly report on Form 10-Q (“Form 10-Q/A”) for the period ended December 31, 2017, which was originally filed with the Securities and Exchange Commission (SEC) on April 16, 2018 (the “Original Filing”), to restate the Company’s unaudited consolidated financial statements as of March 31, 2017 and unaudited condensed consolidated financial statements as of December 31, 2017, as well as the related notes included in the Original Filing (“Restatement”).

This Form 10-Q/A contains only Item 1 (Financial Statements), Item 2 (Management’s Discussion and Analysis of Financial Condition and Results of Operations), Item 4 (Controls and Procedures) of Part I and Item 6 (Exhibits) of Part II, and items including information not affected by the Restatement have not been repeated in this Form 10-Q/A.

The Restatement corrects accounting errors related to:

Note 2, Restatement of Previously Issued Consolidated Financial Statements, in the Company’s condensed consolidated financial statements included in Item 1 below provides further information regarding the Restatement. “Item 4 – Controls and Procedures” to this Form 10-Q/A discloses the material weaknesses in the Company’s internal controls associated with the Restatement, as well as management’s conclusion that the Company’s internal controls over financial reporting were not effective as of December 31, 2017. Management is currently evaluating the changes needed in the Company’s internal controls over financial reporting to remediate these material weaknesses.

This Form 10-Q/A does not reflect events occurring after the filing of the Original Filing and does not substantively modify or update the disclosures therein other than as required to reflect the adjustments described above. See Note 2 to the accompanying condensed consolidated financial statements, set forth in Item 1 of this Form 10-Q/A, for additional information. Accordingly, this Form 10-Q/A should be read in conjunction with the Company’s filings made with the SEC subsequent to the filing of the Original Filing.

We are also filing currently dated certifications from our Chief Executive Officer and Chief Financial Officer as Exhibits 31.1 and 31.2 to this Form 10-Q/A.

Unless the context otherwise requires, references to “we,” “us,” “our,” “ATXG”, or the “Company,” are to Addentax Group Corp. and its subsidiaries.

TABLE OF CONTENTS

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements and Supplementary Data

ADDENTAX GROUP CORP AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In U.S. Dollars, except share data or otherwise stated)

AS OF DECEMBER 31, 2017 (UNAUDITED) AND MARCH 31, 2017

See accompany notes to the condensed consolidated financial statements.

PART I - FINANCIAL INFORMATION

Index to the interim Unaudited Condensed Consolidated Financial Statements

ADDENTAX GROUP CORP. AND SUBSIDIARIES

Condensed Consolidated Balance SheetsCONDENSED CONSOLIDATED STATEMENTS OF (LOSS) INCOME AND COMPREHENSIVE (LOSS) INCOME

(Unaudited)(In U.S. Dollars, except share data or otherwise stated)

FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2017 AND 2016 (UNAUDITED)

The accompanyingSee accompany notes are an integral part of these unauditedto the condensed consolidated financial statements.

ADDENTAX GROUP CORP. AND SUBSIDIARIES

Condensed Consolidated Statements of Operations and Comprehensive LossCONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)(In U.S. Dollars, except share data or otherwise stated)

FOR THE NINE MONTHS ENDED DECEMBER 31, 2017 AND 2016 (UNAUDITED)

The accompanyingSee accompany notes are an integral part of these unauditedto the condensed consolidated financial statements.

ADDENTAX GROUP CORP. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash FlowsNOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)FOR THE NINE MONTHS ENDED DECEMBER 31, 2017 AND 2016 (UNAUDITED)

The accompanying notes are an integral part of these unaudited condensed financial statements

ADDENTAX GROUP CORP.

Notes to the Condensed Consolidated Financial Statements

September 30, 2017

(Unaudited)

NOTE 1 - ORGANIZATION AND NATURE OF BUSINESS

Addentax Group Corp. (“the Company”, “we”, “us” or “our”ATXG”) was incorporated in Nevada on October 28, 2014, and before the Company wastransaction described below, ATXG is engaged in the field of producing images on multiple surfaces using heat transfer technology.

During the reporting period, the Company was mainly engaged in textile and garment manufacturing and providing logistics services to its customers. The Company also provides business consultancy to their customers in assisting them to identify weaknesses in their operation in order to optimize their efficiency. The Company also assists their customers in improving their supply chain management which involves the movement and storage of raw materials, of work in progress inventory, and of finished goods from point of origin to point of consumption.

Share Exchange and Reorganization

AsOn December 28, 2016, ATXG acquired 250,000,000 shares of the Effective Dateissued and pursuant to a Securities Purchase Agreement dated September 25, 2017, the Company andoutstanding stock of Yingxi Industrial Chain Group Co., Ltd.(“Yingxi”), have determined that all conditions necessary to close. The 250,000,000 shares of Yingxi were acquired from the Share Exchange Agreement have been satisfiedmembers of Yingxi in a share exchange transaction in return for the issuance of 500,000,000 shares of common stock of ATXG. The 250,000,000 shares of Yingxi constitute 100% of its issued and thereforeoutstanding stock, and as a result of the date hereof, the Share Exchange Agreement was closed and as suchtransaction, Yingxi has becomebecame a wholly-owned subsidiary of ATXG. And following the Company. As perconsummation of the Share Exchange Agreement,acquisition and giving effect to the Company acquired 250,000,000 sharessecurities exchanged in the offering, the members of Yingxi representing 100%will beneficially own approximately ninty-nine (99%) of the issued and outstanding common stock of ATXG.

Yingxi was incorporated in the Republic of Seychelles on August 4, 2016. ATXG, together with Yingxi and its subsidiaries (the “Company”) operates primarily in the People’s Republic of China (“PRC” or “China”) and is engaged in the business of garments manufacturing and providing logistic services.

On December 15, 2016, Yingxi entered into an equity transfer agreement with the shareholder of Yingxi from the Industrial Chain Investment Co., Ltd (“Yingxi shareholders andHK”) under which Yingxi agreed to pay total consideration of RMB21,008,886 (approximately $3,048,936) in cash in exchange for a 100% ownership interest in Yingxi HK. Yingxi HK was incorporated in Hong Kong in 2016. Yingxi HK is a holding company with no assets other than a 100% equity interest of the Company issued to Yingxi an aggregate of 500,000,000 shares of common stock.following subsidiaries:

RecapitalizationQianhai Yingxi Textile & Garments Co., Ltd (“QYTG”), a wholly-owned subsidiary of Yingxi HK, was incorporated in PRC in 2016.

For financial accounting purposes, this transactionShenzhen Qianhai Yingxi Industrial Chain Services Co., Ltd (“YX”), a wholly-owned subsidiary of QYTG, was treated asincorporated in PRC in 2016.

Xin Kuai Jie Transport Co., Ltd (“XKJ”), a reverse acquisition by Yingxi, and resultedwholly-owned subsidiary of YX, was incorporated in PRC in 2001. XKJ is engaged in the provision of logistic services.

Shenzhen Hua Peng Fa Logistics Co., Ltd (“HPF”), a recapitalization with Yingxi beingwholly-owned subsidiary of YX, was incorporated in the accounting acquirer and Addentax Group Corp. asPRC in 2006. HPF is engaged in the acquired company. The consummationprovision of this reverse acquisition resultedlogistic services.

Dongguan Heng Sheng Wei Garments Co., Ltd (“HSW”), a wholly-owned subsidiary of YX, was incorporated in the PRC in 2009. HSW is a changegarment manufacturer.

Shantou Chenghai Dai Tou Garments Co., Ltd (“DT”), a wholly-owned subsidiary of control. Accordingly,YX, was incorporated in the historical financial statements priorPRC in 2009. DT is a garment manufacturer.

Subsequent to the acquisition are thoseissuance of the accounting acquirer, Yingxi and have been prepared to give retroactive effect toCompany’s Form 10-Q for the reverse acquisition completed on September 25,period ended December 31, 2017, and represent the operations of Yingxi. The consolidated financial statements after the acquisition date, September 25, 2017 include the balance sheets of both companies at historical cost, the historical results of Yingxi and the results of the Company from the acquisition date. All share and per share information indetermined that material adjustments were needed to correct certain accounting errors. Accordingly, the accompanying consolidated financial statements of the Company as of December 31, 2017 and footnotes hasMarch 31, 2017, and the related notes hereto, have been retroactively restated to reflectcorrect these accounting errors (the “Restatement”). A summary of these accounting errors, and their effect on the recapitalization.Company’s consolidated financial statements is as follows:

NOTE 2 - GOING CONCERNThe effect of these adjustments on the Company’s consolidated balance sheets as of December 31, 2017 and March 31, 2017, and cash flows for the nine months ended December 31, 2017 is summarized below:

The accompanying unaudited interimcondensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the liquidation of liabilities in the normal course of business. For the 6 months ended September 30, 2017, the Company has suffered a loss from operations of $119,669. The Company intends to fund operations through equity financing arrangements, which may be insufficient to fund its capital expenditures, working capital and other cash requirements for the year ended March 31, 2018.

The ability of the Company to emerge from an early stage is dependent upon, among other things, obtaining additional financing to continue operations, and development of its business plan. In response to these problems, management intends to raise additional funds through public or private placement offerings.

These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying unaudited interim financial statements do not include any adjustments that might result from the outcome of this uncertainty.

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying unaudited consolidated financial statements have beensubsidiaries are prepared in accordance with accounting principles generally accepted accounting principles in the United States of America for interim financial information(“US GAAP”) and with the instructions to Regulation S-X.

In the opinion of management, all adjustments consisting of normal recurring entries necessary for a fair statement of the periods presented for: (a) the financial position; (b) the result of operations; and (c) cash flows, have been made in order to make the consolidated financial statements presented not misleading. The results of operations for such interim periods are not necessarily indicative of operations for a full year.

Basis of Consolidation

These consolidated financial statements include the accounts of Yingxi Industrial Chain Group Co., Ltdthe Company and its wholly-owned subsidiaries. All material intercompany balancesinter-company accounts and transactions have been eliminated in consolidation.

PrincipalThe Company’s operations are conducted in the PRC. Accordingly, the Company’s business, financial condition and results of subsidiariesoperations may be influenced by the political, economic and legal environment in the PRC, and by the general state of the PRC economy.

The detailsCompany’s operations in the PRC are subject to special considerations and significant risks not typically associated with companies in North America and Western Europe. These include risks associated with, among others, the political, economic and legal environment and foreign currency exchange. The Company’s results may be adversely affected by changes in the political and social conditions in the PRC, and by changes in governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversion, remittances abroad, and rates and methods of taxation.

The Company’s reporting currency is the U.S. dollar. The functional currency of the principal subsidiariesparent company is the U.S. dollar and the functional currency of the CompanyCompany’s operating subsidiaries is the Chinese Renminbi (“RMB”). For the subsidiaries whose functional currencies are set out as follows:the RMB, all assets and liabilities are translated at exchange rates at the balance sheet date and revenue and expenses are translated at the average yearly exchange rates and equity is translated at historical exchange rates. Any translation adjustments resulting are not included in determining net income but are included in foreign exchange adjustment to other comprehensive income, a component of equity.

Use of Estimates

The preparation of the consolidated financial statements is in conformity with theUS GAAP that requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities. It also requires theliabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amountamounts of revenues and expenses during the reporting period. Actualperiods. Management makes these estimates using the best information available at the time the estimates are made; however actual results could differ materially from those estimates.

Foreign Currency Translation

The Company’s reporting currency is the U.S. Dollars (“USD”). The functional currency of the Company and its subsidiaries is Chinese Yuan Renminbi (“RMB”). All transactions initiated in RMB are translated into USD in accordance with ASC 830,“Foreign Currency Matters,”as follows:

Adjustments arising from such translations are includedAccounting Standards Codification (“ASC”) 820 “Fair Value Measurements and Disclosures”, which defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. The statement clarifies that the exchange price is the price in accumulated other comprehensive incomean orderly transaction between market participants to sell the asset or transfer the liability in shareholders’ equity.the market in which the reporting entity would transact for the asset or liability, that is, the principal or most advantageous market for the asset or liability. It also emphasizes that fair value is a market-based measurement, not an entity-specific measurement, and that market participant assumptions include assumptions about risk and effect of a restriction on the sale or use of an asset.

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

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

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

At December 31, 2017, the Company has no financial assets or liabilities subject to recurring fair value measurements.

The Company’s financial instruments include cash, accounts receivable, consistsadvances to suppliers, other receivables, accounts payable, other payables, taxes payables and related party receivables or payables. Management estimates that the carrying amounts of trade receivablesfinancial instruments approximate their fair values due to their short-term nature. The fair value of amounts with related parties is not practicable to estimate due to the related party nature of the underlying transactions.

The Company considers all highly liquid investments purchased with original maturities of three months or less to be cash equivalents. The Company had no cash equivalents at December 31, 2017.

Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of accounts receivable. The Company extends credit to its customers in the normal course of business and generally does not require collateral. The Company’s credit terms are dependent upon the segment, and the customer. The Company assesses the probability of collection from customers. Theeach customer at the outset of the arrangement based on a number of factors, including the customer’s payment history and its current creditworthiness. If in management’s judgment collection is not probable, the Company does not record revenue until the uncertainty is removed.

Management performs ongoing credit evaluations, and the Company maintains an allowance for potential credit losses based upon its loss history and its aging analysis. The allowance for doubtful accounts is the Company’s best estimate of the amount of credit losses in existing accounts receivable. Management reviews the allowance for doubtful accounts each reporting period based on a detailed analysis of trade receivables. In the Company’s assessmentanalysis, management primarily considers the age of collectabilitythe customer’s receivable, and also considers the creditworthiness of the customer, receivable. The Company analyzes pastthe economic conditions of the customer’s industry, general economic conditions and trends, and the business relationship and history with a customer, customer credit, collection history, and financial condition when evaluatingits customers, among other factors. If any of these factors change, the Company may also change its original estimates, which could impact the level of the Company’s future allowance for doubtful accounts. If judgments regarding the collectability of customer accounts. Uncollectible accounts are charged offreceivables were incorrect, adjustments to the allowance when it is deemed probable that the receivable will notmay be recovered.

For the concentration risk disclosure, please refer to Note 10.required, which would reduce profitability.

Financial InstrumentsAccounts receivable are recognized and carried at the original invoice amount less an allowance for any uncollectible amounts. An estimate for doubtful accounts receivable is made when collection of the full amount is no longer probable. Bad debts are written off as incurred. No allowance for doubtful accounts was made for the three and nine months ended December 31, 2017.

The Company’s consolidated financial instruments consist primarily of cash,following customers had an accounts receivable prepaid expenses, inventory and other assets,balance greater than 10% of total accounts payable and accrued expenses and other payables. The carrying amounts of such financial instruments approximate their respective estimated fair value due to their short-term maturities.receivable at December 31, 2017.

Concentrations of Credit Risks

The Company’s exposure to concentrationsManufacturing segment inventories consist of credit risk primarily related to its cashraw materials, work in progress and cash equivalents. The Company places its cashfinished goods and cash equivalents with financial institutions of high credit worthiness. The Company’s management assess the financial strength and credit worthiness of any parties to which it extends funds, and as such, it believes that any associated credit risk exposures are limited.

Inventory

Inventory is stated at the lower of cost, (weighted average)determined on a weighted average basis, or net realizable value. The Company’s inventoryNet realizable value is constantly monitoredthe estimated selling price in the ordinary course of business less the estimated cost of completion and the estimated costs necessary to make the sale. When inventories are sold, their carrying amount is charged to expense in the period in which the revenue is recognized. Write-downs for obsolescence. This is based ondeclines in net realizable value or for losses of inventories are recognized as an expense in the management’s estimatesperiod the impairment or loss occurs. No allowance for obsolete finished goods was made for the three and they have taken into considerations factors such as turnover, technical obsolescence, right of return status to suppliers and price protection offered by suppliers. These estimates are necessarily subject to a degree of measurement uncertainty. Reserves for slow-moving and obsolete inventory at September 30, 2017 were $0 and at Marchnine months ended December 31, 2017were $0.

Related Parties2017.

TheDuring the three and nine months ended December 31, 2017, approximately 62% and 57% of total inventory purchases were from the Company’s five largest suppliers, respectively. Management believes that should the Company follows ASC 850,“Related Party Disclosures,”forlose any one of its major suppliers, other suppliers are available that could provide similar products to the identification of related parties and disclosure of related party transactions see Note 9.Company on comparable terms.

Property and Equipment

PropertyPlant and equipment are carried at cost less accumulated depreciation. Cost includes all direct costs necessary to acquire and prepare assets for use.

The costsDepreciation is provided over the assets’ estimated useful lives, using the straight-line method. Estimated useful lives of repairs and maintenance are expensed when incurred, while expenditures for refurbishments and improvements that significantly add to the productive capacity or extend the useful life of an asset are capitalized. When assets are retired or sold, the asset’s cost and related accumulated depreciation are eliminated with any remaining gain or loss recognized in net earnings.

Depreciation of plant and equipment is recorded on the straight-line method over estimated useful lives, generallyare as follows:

ImpairmentThe cost and related accumulated depreciation of long-lived assets sold or otherwise retired are eliminated from the accounts and any gain or loss is included in the statement of income. The cost of maintenance and repairs is charged to the statement of income as incurred, whereas significant renewals and betterments are capitalized.

Goodwill represents the excess of the purchase price over the net fair value of the identifiable tangible and intangible assets acquired and the fair value of liabilities assumed in acquisitions. ASC350-30-50 “Goodwill and Other Intangible Assets”, requires the testing of goodwill and indefinite-lived intangible assets for impairment at least annually. The Company tests goodwill for impairment in the fourth quarter of each year.

We evaluate carryingUnder applicable accounting guidance, the goodwill impairment analysis is a two-step test. The first step of the goodwill impairment test involves comparing the fair value of long-livedeach reporting unit with its carrying amount including goodwill. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired; however, if the carrying amount of the reporting unit exceeds its fair value, the second step must be performed to measure potential impairment.

The second step involves calculating an implied fair value of goodwill for each reporting unit for which the first step indicated possible impairment. If the implied fair value of goodwill exceeds the goodwill assigned to the reporting unit, there is no impairment. If the goodwill assigned to a reporting unit exceeds the implied fair value of goodwill, an impairment charge is recorded for the excess.

In the fourth quarter of 2016, the Company tested goodwill for impairment and it was determined that goodwill was not impaired and none of the Company’s reporting units with significant goodwill was at risk of failing step one of this goodwill impairment test.

Long-lived assets held and used by the Company are reviewed for impairment whenever events or changes in circumstances would indicate that itthe carrying amount of assets may not be recoverable. It is more likely than not their carrying values may exceed their realizable values,reasonably possible that these assets could become impaired as a result of technology or other industry changes. Determination of recoverability of assets to be held and records impairment charges when considered necessary.

When circumstances indicate that impairment may have occurred, the Company tests such assets for recoverabilityused is by comparing the estimatedcarrying amount of an asset to future net undiscounted future cash flows expected to result frombe generated by the use ofassets. If such assets and their eventual dispositionare considered to their carrying amount. In estimating these future cash flows, assets and liabilities are grouped at a lowest level forbe impaired, the impairment to be recognized is measured by the amount by which there are identifiable cash flows that are largely independent of the cash flows generated by other such groups. If the undiscounted future cash flows are less than the carrying amount of the asset, an impairment loss, measured asassets exceeds the excessfair value of the assets. Assets to be disposed of are reported at the lower of the carrying value of the asset over its estimatedamount or fair value is recognized. Fair values are determined based on discounted cash flows, quoted market values or external appraisals as applicable.less costs to sell.

Revenue RecognitionThere was no impairment of long-lived assets as of December 31, 2017.

The Company recognizes manufacturing revenue onlyfrom product sales, net of value added taxes, upon delivery at which time title passes to the customer provided that there are no uncertainties regarding customer acceptance, persuasive evidence of an arrangement exists, the sales price is fixed and determinable and collectability is deemed probable. Service revenue is recognized at the time at the point in time when alldelivery is completed and the shipping terms of the following criteriacontract have been met:satisfied.

Cost of revenues for manufacturing segment includes the direct raw material cost, direct labor cost, manufacturing overheads including depreciation of production equipment and rent. Cost of for service segment includes gasoline and diesel fuel, toll charges and subcontracting fees.

Deferred RevenueThe Company reports earnings per share in accordance with ASC 260 “Earnings Per Share”, which requires presentation of basic and diluted earnings per share in conjunction with the disclosure of the methodology used in computing such earnings per share. Basic earnings per share excludes dilution and is computed by dividing income available to common stockholders by the weighted average common shares outstanding during the period. Diluted earnings per share takes into account the potential dilution that could occur if securities or other contracts to issue common stock were exercised and converted into common stock. Further, if the number of common shares outstanding increases as a result of a stock dividend or stock split or decreases as a result of a reverse stock split, the computations of a basic and diluted earnings per share shall be adjusted retroactively for all periods presented to reflect that change in capital structure.

Deferred revenue are services billedThe Company’s basic earnings per share is computed by dividing the net income available to customers for whichholders by the servicesweighted average number of the Company’s ordinary shares outstanding. Diluted earnings per share reflects the amount of net income available to each ordinary share outstanding during the period plus the number of additional shares that would have not been fully performed. Asoutstanding if potentially dilutive securities had been issued. The Company had no potentially dilutive ordinary shares as of September 30, 2017 and MarchDecember 31, 2017, deferred revenue were $492,553 and $290,099, respectively.2017.

Income Taxes

The Company accounts for income taxes using the asset and liability method in accordance withprescribed by ASC 740“Accounting for Income Taxes.” The asset and liability “Income Taxes”. Under this method, provides that deferred tax assets and liabilities are recognized fordetermined based on the expected future tax consequences of temporary differencesdifference between the financial reporting and tax bases of assets and liabilities and for operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using the currently enacted tax rates and laws that will be in effect whenin the year in which the differences are expected to reverse. The Company records a valuation allowance to reduceoffset deferred tax assets toif based on the amountweight of available evidence, it is more-likely-than-not that is believed more likely thansome portion, or all, of the deferred tax assets will not to be realized.

Uncertain Tax Positions The effect on deferred taxes of a change in tax rates is recognized as income or loss in the period that includes the enactment date.

The Company follows guidance issued by the FASB regarding accounting for uncertainty in income taxes. This guidance clarifies the accounting for income taxes by prescribing the minimum recognition threshold an incomedoes not have any material unrecognized tax position is required to meet before being recognized in the financial statements and applies to all income tax positions. Each income tax position is assessed using a two-step process. A determination is first made as to whether it is more likely than not that the income tax position will be sustained, based upon technical merits, upon examination by the taxing authorities. If the income tax position is expected to meet the more likely than not criteria, the benefit recorded in the financial statements equals the largest amount that is greater than 50% likely to be realized upon its ultimate settlement.benefits.

The Company recordsis governed by the Income Tax Laws of the PRC. The PRC federal statutory tax rate is 25%. The Company files income tax relatedreturns with the relevant government authorities in the PRC. The Company does not believe there will be any material changes in its unrecognized tax positions over the next 12 months.

The Company’s policy is to recognize interest and penalties accrued on any unrecognized tax benefits as a component of the provision for income tax expense. As of September 30, 2017The Company does not have any accrued interest or penalties associated with any unrecognized tax benefits, nor was any interest expense recognized during the three and Marchnine months ended December 31, 2017,2017. The Company’s effective tax rate differs from the Company determined there were no uncertainPRC federal statutory rate primarily due to non-deductible expenses, temporary differences and preferential tax provisions.treatment.

Earnings (Loss) Per ShareNew U.S. federal tax legislation, commonly referred to as the Tax Cuts and Jobs Act (the “U.S. Tax Reform”), was signed into law on December 22, 2017. The U.S. Tax Reform modified the U.S. Internal Revenue Code by, among other things, reducing the statutory U.S. federal corporate income tax rate from 35% to 21% for taxable years beginning after December 31, 2017; limiting and/or eliminating many business deductions; migrating the U.S. to a territorial tax system with a one-time transaction tax on a mandatory deemed repatriation of previously deferred foreign earnings of certain foreign subsidiaries; subject to certain limitations, generally eliminating U.S. corporate income tax on dividends from foreign subsidiaries; and providing for new taxes on certain foreign earnings. Taxpayers may elect to pay the one-time transition tax over eight years, or in a single lump-sum payment. The Company measured the current and deferred taxes based on the provisions of the Tax legislation. After the Company’s measurement, no deferred tax benefit nor expense relating to the Tax Act changes for the period ended December 31, 2017.

The Company has adopted ASC 260,“Earnings Per Share,” (“EPS”) which requires presentation of basic and diluted EPS on the face of the income statement for all entities with complex capital structures, and requires a reconciliation of the numerator and denominator of the basic EPS computation to the numerator and denominator of the diluted EPS computation. In the accompanying consolidated statements of operations and comprehensive loss, basic loss per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period.

The Company had no potentially dilutive securities, such as convertible debt, options or warrants, issued and outstanding during the six months ended September 30, 2017 and 2016.

Recent Accounting Pronouncements

The Company has reviewed all other 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 our consolidated financial statements.

In September 2017,May 2014, the FASB has issued Accounting Standards Update (ASU) No. 2017-13,“Revenue RecognitionASU 2014-09, “Revenue from Contracts with Customers (Topic 605), 606).” (“ASU 2014-09”). The core principle of the guidance is that an entity should recognize 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 or services. ASU 2014-09 supersedes most existing revenue recognition guidance in US GAAP. In August 2015, the FASB issued ASU 2015-14,Revenue from Contracts with Customers (Topic 606): Deferral of Effective Date (“ASU 2015-14”), Leases (Topic 840),which defers the effective date of ASU 2014-09 to January 1, 2018 for the Company. Early adoption is permitted. The Company expects to adopt ASU 2014-09 utilizing the modified retrospective method in the first quarter of 2018.

The Company is in the process of reviewing revenue contracts across each revenue stream and Leases (Topic 842): Amendmentscontinues to SEC Paragraphs Pursuantevaluate the impact the standard would have on each revenue stream. As a result of the Company’s evaluation performed to date, the Staff Announcement at the July 20, 2017 EITF Meeting and Rescission of Prior SEC Staff Announcements and Observer Comments.”The amendments in ASU No. 2017-13 amends the early adoption date option for certain companies related toCompany does not believe the adoption of ASU No. 2014-09 and ASU No. 2016-02. Both ofthis new standard will have a material impact on the below entities may still adopt using the public company adoption guidance in the related ASUs, as amended. The effective date is the same as the effective date and transition requirements for the amendments for ASU 2014-09 and ASU 2016-02.Company’s revenue recognition policy.

In May 2014,January 2016, the FASB issued an accounting standards updateASU 2016-01, “Financial Instruments-Overall (Subtopic 825-10): Recognition and introduced a 5-step approach which modifies the requirements for identifying, allocating,Measurement of Financial Assets and recognizing revenue related to the achievementFinancial Liabilities(“ASU 2016-01”)”. The standard addresses certain aspects of performance conditions under contracts with customers. This update also requires additionalrecognition, measurement, presentation, and disclosure related to the nature, amount, timing, and uncertainty of revenue that is recognized under contracts with customers. This guidancefinancial instruments. ASU 2016-01 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2017. The Company evaluated the impact of adopting the new standard and conclude there was no material impact to its consolidated financial statement.

In February 2016, the FASB issued ASU 2016-02,“Lease (Topic 842)”, which amends recognition of lease assets and lease liabilities by lessees for those leases classified as operating leases. Under the new guidance, lessees will be required to recognize a lease liability and a right-of-use asset for all leases (with the exception of short-term leases) at the commencement date. This standard will take effect for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The Company is currently assessing the impact of this new standard on its consolidated financial statements.

In August 2016, the FASB issued ASU 2016-15, “Statement of Cash flows -—Classification of Certain Cash Receipts and Cash Payment”, effective for the fiscal years beginning after December 15, 2017, and is requiredinterim periods within that fiscal year. This Update addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice. The Company evaluated the impact of adopting the new standard on its consolidated financial statements and conclude there was no material impact to the Company’s financial statement.

In January, 2017, the FASB issued 2017-01 “Business Combinations”, effective for the annual reporting period beginning after December 15, 2017, and interim period within that period. This Updated clarifies the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be applied retrospectivelyaccounted for as acquisitions of assets or business. The Company evaluated the impact of adopting the new standard on its consolidated financial statements and conclude there was no material impact to all revenue arrangements.the Company’s financial statement.

In February 2017, the FASB issued ASU 2017-05 “Other Income—Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20)”, effective for the annual reporting period beginning after the December 15, 2017, including the interim reporting period within that period. This update provides guidance on the recognition of gains and losses on transfers of nonfinancial assets and in substance nonfinancial assets to counterparties that are not customers. The adoptionCompany evaluated the impact of this guidance isadopting the new standard on its consolidated financial statements and conclude there was no material impact to the Company’s financial statement.

The Company reviews new accounting standards as issued. Management has not expected toidentified any other new standards that it believes will have a significant impact on the Company’s consolidated financial statements.

In

On December 10, 2016, the FASB has issued Accounting Standards Update (ASU) No. 2016-20, “Technical Corrections and ImprovementsCompany entered into an equity transfer agreement relating to Topic 606, Revenue from Contracts with Customers.” The amendments affect narrow aspectsthe acquisition of 100% of the guidance issued in ASU 2014-09 including Loan Guarantee Fees, Contract Costs, Provisions for Lossesequity of Yingxi Industrial Chain Investment Co., Ltd (“Yingxi HK”) and subsidiaries. The acquisition was financed with proceeds from the Company’s borrowings from a third party. The acquisition was closed on Construction-Type and Production-Type Contracts, DisclosureDecember 15, 2016. The results of Remaining Performance Obligations, Disclosureoperations of Prior Period Performance Obligations, Contract Modifications, Contract Asset vs. Receivable, Refund Liability, Advertising Costs, Fixed Odds Wagering ContractsYingxi HK are included in the Casino Industry, and Costs Capitalized for Advisors to Private Funds and Public Funds. The effective date and transition requirements for the amendments are the same as the effective date and transition requirements for FASB Accounting Standards Codification Topic 606. Public entities should apply Topic 606 (and related amendments) for annual reporting periodsCompany’s consolidated financial statements beginning afteron December 15, 2017, including interim reporting periods therein.

NOTE 4 – INVENTORY

Inventory at September 30, 2017 and March 31, 2017consist of the following:

NOTE 5 – NOTES RECEIVABLE

Note receivable at September 30, 2017 and March 31, 2017amounted to $1,613,812 and $1,057,437, respectively.2016.

The amounts are interest free, unsecuredfollowing represents the purchase price allocation at the dates of the acquisition:

The Company provides an allowance for doubtful accounts receivable. The receivables and have no fixed terms of repayment. Asallowance balances at September 30,December 31, 2017 and March 31, 2017 there were no interest due and outstanding and no provision had beenare as follows:

No allowance for doubtful accounts was made for non-repayment of the loan or interest.period ended December 31, 2017 and year ended March 31, 2017.

NotesOther receivables consisted mainly of interest-free loanprimarily represent unsecured and non-interest bearing short-term advances that the Company makes from time-to-time to third-party entities. These advances are unsecured and due from unrelated third parties, social insurance and housing provident fund, and input Value Added Tax to be credited.

on demand.

NOTE 6 – PROPERTY AND EQUIPMENTThe Company leases Shenzhen XKJ office rent-free from Bihua Yang.

Property and equipment at September 30, 2017 and March 31, 2017, consist of the following:

Depreciation expense for the six months ended September 30, 2017 and 2016 amounted to $56,797 and $49,719, respectively.

NOTE 7 – ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

Accounts payable and accrued liabilities at September 30, 2017 and March 31, 2017, consist of the following:

NOTE 8 – LOAN PAYABLE

The componentsCompany had the following related party balances at the end of our short-term debtthe period/year:

The balances represent cash advances paid to or due from legal representatives for reimbursable company expenses.

The balances with related parties are unsecured, non-interest bearing and repayable on demand. These balances were fully settled in 2018.

Inventories consist of the associated interest rates, were as followsfollowing as of September 30,December 31, 2017 and March 31, 2017:

DuringThe Company has made advances to third-party suppliers in advance of receiving inventory parts. These advances are generally made to expedite the six months ended September 30, 2017delivery of required inventory when needed and 2016, the Company borrowed $4,275,000to help to ensure priority and $0, and repaid $1,680,000 and $0, respectively.preferential pricing on such inventory. The amounts advanced to suppliers are fully refundable on demand.

NOTE 9 – RELATED PARTY TRANSACTIONS

Due from related parties

Due from related parties at September 30,Plant and equipment consists of the following as of December 31, 2017 and March 31, 2017consist of as follows:2017:

Depreciation expense for the three and nine months ended December 31, 2017 was $28,646 and $84,535, respectively.

The amounts were interest free, unsecuredCompany operates in the PRC and files tax returns in the PRC jurisdictions.

Yingxi Industrial Chain Group Co., Ltd was incorporated in the Republic of Seychelles and, under the current laws of the British Virgin Islands, is not subject to income taxes.

Yingxi HK was incorporated in Hong Kong and is subject to Hong Kong income tax at a tax rate of 16.5%. No provision for income taxes in Hong Kong has been made as Yingxi HK had no fixed terms of repayment.taxable income for the three and nine months ended December 31, 2017 and 2016.

DueQYTG and YX were incorporated in the PRC and is subject to related parties

Due to related parties at September 30,the PRC federal statutory tax rate is 25%. No provision for income taxes in the PRC has been made as QYTG and YX had no taxable income for the three and nine months ended December 31, 2017 and March 31, 2017consist of as follows:

The amounts were interest free, unsecured and had no fixed terms of repayment.

NOTE 10 – CONCENTRATION OF CREDIT RISKS2016.

The Company had certain customers whose revenue individually represented 10% or moreis governed by the Income Tax Laws of the PRC. Yingxi’s operating companies, HSW, HPF and DT were subject to an EIT rate of 25% in 2017. XKJ enjoyed the preferential tax benefits and its EIT rate was 15% in 2017.

The Company’s total revenue, or whose accounts receivable balances individually represented 10% or moreparent entity, Addentax Group Corp. is an U.S. entity and is subject to the United States federal income tax. No provision for income taxes in the United States has been made as Addentax Group Corp. had no United States taxable income for the three and nine months ended December 31, 2017 and 2016.

No deferred taxes were recognized for the three and nine months ended December 31, 2017 and 2016.

The reconciliation of income taxes computed at the Company’s total accounts receivable, or whose accounts payable balances individually represented 10% or more ofPRC federal statutory tax rate applicable to the Company’s total accounts payable, the details of whichPRC, to income tax expenses are set out as follows:

In accordance with the relevant taxation laws in the PRC, the normal VAT rate for domestic sales is 17%, which is levied on the invoiced value of sales and is payable by the purchaser. The Company is required to remit the VAT it collects to the tax authority. A credit is available whereby VAT paid on purchases can be used to offset the VAT due on sales.

For services, the sixapplicable VAT rate is 11% under the relevant tax category for logistic company, except the branch of HPF enjoyed the preferential VAT rate of 3% in 2017. The Company is required to pay the full amount of VAT calculated at the applicable VAT rate of the invoiced value of sales as required. A credit is available whereby VAT paid on gasoline and toll charges can be used to offset the VAT due on service income.

Segment information is consistent with how management reviews the businesses, makes investing and resource allocation decisions and assesses operating performance. The segment data presented reflects this segment structure. The Company reports financial and operating information in the following two segments:

The Company also provides general corporate services to its segments and these costs are reported as “Corporate and others”.

Selected information in the segment structure is presented in the following tables:

Revenues by segment for the three and nine months ended September 30, 2017 and the year ended MarchDecember 31, 2017 5 customers accounted for 53% and 5 customer accounted for 55% of the revenue of the Company, respectively.are as follows:

At September 30,

Income from operations by segment for the three and nine months ended December 31, 2017 are as follows:

Depreciation and amortization by segment for the three and nine months ended December 31, 2017 are as follows:

Total assets by segment at December 31, 2017 and March 31, 2017 2 customers accounted for 58%are as follows:

Goodwill by segment at December 31, 2017 and 3 customers accounted for 55%March 31, 2017 is as follows:

Accrued expenses and other payables consist of the accounts receivablefollowing as of December 31, 2017 and March 31, 2017:

14. RESERVES

In accordance with the relevant laws and regulations of the PRC, the subsidiary of the Company respectively.

NOTE 11 – INCOME TAX

The Companyestablished in the PRC is required to transfer 10% of its profit after taxation prepared in accordance with the accounting regulations of the PRC to the statutory reserve until the reserve balance reaches 50% of the subsidiary’s paid-up capital. Such reserve may be used to offset accumulated losses or increase the registered capital of the subsidiary, subject to U.S. Income taxes. For the 6 months ended September 30,approval from the PRC authorities, and are not available for dividend distribution to the shareholders. At December 31, 2017 and the year ended March 31, 2017, the Company does not have to pay any U.S. income tax.paid-up statutory reserve was RMB148,418 or $21,539.

The currency translation reserve represents translation differences arising from translation of foreign currency financial statements into the Company’s subsidiary, Yingxi was incorporated on August 4, 2016 in the Republic of Seychelles. Yingxi’s subsidiary YICI was incorporated on July 28, 2016 in Hong Kong China. YICI’s subsidiaries DHSW, QYTG, SCDT, SHPF, SQYI and SXKJ were incorporated on May 15, 2009, November 29, 2016, May 13, 1982, July 6, 2006, January 29, 2016, and September 28, 2001 respectively in China.

functional currency.

The Company has subsidiaries operate in China and they file their tax returns in accordance with China’s laws and regulations.

Provision for income taxes in China for the six months ended September 30, 2017 and the year ended March 31, 2017 were $6,128 and $15,326 respectively. The income tax rate for the years 2017 and 2016 are 25% in China. However, DHSW and SHPF enjoyed a preferential income tax rate at 10% for the year 2016. Whereas SHPF enjoyed a preferential income tax rate at 10% for the year 2016.

The Company’s subsidiaries do not generate any income in Hong Kong or Seychelles for the 6 months ended September 30, 2017 and the years ended March 31, 2017 and hence does not have to pay any Hong Kong Profits tax or Seychelles income tax.

NOTE 12 – SHAREHOLDERS’ EQUITY

Common Stock

The Company has 1,000,000,000, $0.001 par value shares of common stock authorized.

On September 25, 2017, pursuant to the Share Exchange Agreement (See Note 1), the Company issued 500,000,000 shares of common stock to the stockholders of Yingxi in exchange for 250,000,000 shares of Yingxi’s common stock, representing 100% of its issued and outstanding common stock. As a result of the reverse acquisition accounting, these shares issued to the former Yingxi stockholders are treated as being outstanding from the date of issuance of the Insight shares.

There were 506,920,000 shares of common stock outstanding as of September 30, 2017.

The Company has no stock option plan, warrants or other dilutive securities.

NOTE 13 –SUBSEQUENT EVENTS

The Company has analyzed its operations subsequent to September 30, 2017, through the date these financials were approved to be issued, and has determined that it does not have any material events.