Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | May 14, 2020 | |
Cover [Abstract] | ||
Entity Registrant Name | China Foods Holdings Ltd. | |
Entity Central Index Key | 0001310630 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2020 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business Flag | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | true | |
Entity Common Stock, Shares Outstanding | 5,252,309 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2020 |
Balance Sheets
Balance Sheets - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Current Assets | ||
Bank balance | $ 7,504 | $ 12,328 |
Prepayment | 1,282 | |
Total Current Assets | 8,786 | 12,328 |
TOTAL ASSETS | 8,786 | 12,328 |
Current Liabilities | ||
Other payables | 3,758 | 6,633 |
Income taxes payable | 100 | 100 |
Amount due to a related party | 80,697 | 92,122 |
Amount due to the holding company | 52,628 | 30,000 |
Total Current Liabilities and Total Liabilities | 137,183 | 128,855 |
Stockholders' Deficit | ||
Common stock ($0.0001 par value, 100,000,000 shares authorized, 5,252,309 shares issued and outstanding | 525 | 525 |
Additional paid-in capital | 136,988 | 136,988 |
Other reserve | 350,547 | 350,547 |
Accumulated deficit | (616,457) | (604,587) |
Total Stockholders' Deficit | (128,397) | (116,527) |
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT | $ 8,786 | $ 12,328 |
Balance Sheets (Parenthetical)
Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 5,252,309 | 5,252,309 |
Common stock, shares outstanding | 5,252,309 | 5,252,309 |
Statements of Operations (Unaud
Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | ||
Income Statement [Abstract] | |||
Income | |||
Cost of Sales | |||
Gross Profit | |||
General and administrative expense | 11,870 | 23,473 | |
Operating loss | (11,870) | (23,473) | |
Interest expense to a related party | |||
Loss before income taxes | (11,870) | (23,473) | |
Provision for income taxes | |||
Net loss | $ (11,870) | $ (23,473) | |
Net loss per common share Basic and diluted | [1] | $ 0 | $ 0 |
Weighted average number of common share Basic and diluted | 5,252,309 | 5,252,309 | |
[1] | denotes net loss per common share of less than $0.01 per share |
Statements of Shareholders' Def
Statements of Shareholders' Deficit (Unaudited) - USD ($) | Common Stock [Member] | Additional Paid-In Capital [Member] | Other Reserve [Member] | Accumulated Deficit [Member] | Total |
Balance at Dec. 31, 2018 | $ 137,413 | $ 350,547 | $ (511,785) | $ (23,825) | |
Balance, shares at Dec. 31, 2018 | 5,251,309 | ||||
Merger transaction | $ (136,888) | 136,988 | 100 | ||
Merger transaction, shares | 1,000 | ||||
Net loss for the period | (23,473) | (23,473) | |||
Balance at Mar. 31, 2019 | $ 525 | 136,988 | 350,547 | (535,258) | (47,198) |
Balance, shares at Mar. 31, 2019 | 5,252,309 | ||||
Balance at Dec. 31, 2019 | $ 525 | 136,988 | 350,547 | (604,587) | (116,527) |
Balance, shares at Dec. 31, 2019 | 5,252,309 | ||||
Net loss for the period | (11,870) | (11,870) | |||
Balance at Mar. 31, 2020 | $ 525 | $ 136,988 | $ 350,547 | $ (616,457) | $ (128,397) |
Balance, shares at Mar. 31, 2020 | 5,252,309 |
Statements of Cash Flows (Unaud
Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Operating Activities: | ||
Net loss | $ (11,870) | $ (23,473) |
Changes in operating assets and liabilities: | ||
(Decrease) Increase in other payable | (2,875) | 7,001 |
(Increase) in prepayment | (1,282) | |
Increase in income taxes payable | 100 | |
(Decrease) Increase in amount due to a related party | (11,425) | 16,372 |
Increase in amount due to the holding company | 22,628 | |
NET CASH USED BY OPERATING ACTIVITIES | (4,824) | |
NET INCREASE IN CASH | (4,824) | |
CASH at beginning of period | 12,328 | |
CASH at end of period | 7,504 | |
Supplemental disclosure of cash flow information | ||
Interest paid | ||
Taxes paid | $ 100 |
Nature of Operations and Basis
Nature of Operations and Basis of Presentation | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Operations and Basis of Presentation | NOTE 1 – NATURE OF OPERATIONS AND BASIS OF PRESENTATION China Foods Holdings Ltd. (the “Company”) was incorporated in Delaware on January 10, 2019. On January 23, 2019, the Company entered into an Agreement and Plan of Merger (the “Agreement”) with Trafalgar Resources, Inc., a Utah corporation (“Trafalgar”). Pursuant to the Agreement, the Company merged with Trafalgar (the “Merger”) with the Company as the surviving entity. Prior to the Merger, Trafalgar had not commenced operations for several years that had resulted in significant revenue and Trafalgar’s efforts had been devoted primarily to activities related to raising capital and attempting to acquire an operating entity. Prior to the Merger, Trafalgar’s majority stockholder who owned 5,000,000 shares (approximately 95.2%) of the 5,251,309 outstanding shares of Trafalgar’s common stock, par value $0.0001, signed a written consent approving the Merger and the related transactions. Such approval and consent were sufficient under Utah law and Trafalgar’s Bylaws to approve the Merger. The boards of directors and shareholders of the Company and Trafalgar approved the Merger. Pursuant to the Merger, each share of Trafalgar’s common stock was converted into one share of the Company’s common stock. After the Merger, HY (HK) Financial Investments Co., Ltd. owns 5,001,000 shares of common stock of the Company. The Merger was effective on March 13, 2019. On December 11, 2019, the Board of Directors approved a change to its fiscal year-end from September 30 to December 31. As a result of this change, the Company recognized a fiscal transition period beginning October 1, 2019 through December 31, 2019. In these statements, including the notes thereto, financial results for fiscal 2019 are for a 3-month period. Corresponding results for the years ended September 30, 2019 and 2018 are both for 12-month periods. Basis of Presentation The unaudited condensed financial statements present the balance sheets, statements of operations, statements of shareholders’ deficit and statements of cash flows of the Company. These unaudited condensed financial statements are presented in the United States dollars and have been prepared in accordance with accounting principles generally accepted in the United States. Unaudited Financial Statements The accompanying unaudited condensed financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission, or the SFC, including the instruction to Form 10-Q and Article 8 of Regulation S-X. In the opinion of Management, all adjustments, which are of a normal recurring nature, necessary for a fair presentation of the results for the three months ended March 31, 2020, have been made. Operating results for the three months ended March 31, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020. They do not include all of the information and footnotes required by United States generally accepted accounting principles for complete financial statements. |
Significant Accounting Policies
Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | NOTE 2 – SIGNIFICANT ACCOUTING POLICIES Net Loss per Common Share Loss per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. There are no such common stock equivalents outstanding as of March 31, 2020. Income Taxes The Company accounts for income taxes pursuant to FASB ASC 740-10-05, “Accounting for Income Taxes”. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets will be reflected on the balance sheet when it is determined that it is more likely than not that the asset will be realized. A valuation allowance has currently been recorded to reduce our deferred tax asset to $0. Fair Value of Financial Instruments The Company estimates the fair value of financial instruments using the available market information and valuation methods. The Company’s financial instruments consist of accounts payable and amount due to a related party. The carrying amount of these financial instruments approximated fair value due to the length of maturity or interest rates that approximate prevailing market rates. Use of estimates The presentation of financial statements and related disclosures in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities. Certain significant accounting policies that contain subjective management estimates and assumptions include those related to going concern and valuation allowance on deferred income tax. Operating results in the future could vary from the amounts derived from management’s estimates or assumptions. Recently Issued Accounting Pronouncements The Company has reviewed Accounting Standards Updates (“ASU”) through ASU No. 2018-05, which contain technical corrections to existing guidance or affect guidance to specialized industries or entities were recently issued. These updates have no current applicability to the Company or their effect on the financial statements would not have been significant. From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies that are adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on the Company’s financial position or results of operations upon adoption. |
Going Concern
Going Concern | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Going Concern | NOTE 3 - GOING CONCERN As shown in the accompanying financial statements, the Company had a deficit working capital and an accumulated deficit incurred through March 31, 2020 which raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that might be necessary in the event the Company cannot continue in existence. Management intends to seek new capital from a related party to provide needed funds. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | NOTE 4 – INCOME TAXES Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carry forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. Income tax periods 2017, 2018 and 2019 are open for examination by taxing authorities. The income tax expense (benefit) for the period ended March 31, 2020 differs from the amount computed using the federal statutory rates as follows: Three months ended Three months ended Income tax expense (benefit) at Federal tax rate of 21% for 2020 and 2019 $ (2,703 ) $ (4,929 ) Valuation allowance 2,703 4,929 - - On December 22, 2017, the 2017 Tax Cuts and Jobs Act (the Tax Act) was enacted into law including a one-time mandatory transition tax on accumulated foreign earnings and a reduction of the corporate income tax rate to 21% effective on January 1, 2018, among others. We are required to recognize the effect of the tax law changes in the period of enactment, such as determining the transition tax, remeasuring our U.S. deferred tax assets and liabilities as well as reassessing the net realizability of our deferred tax assets and liabilities. The Company does not have any foreign earnings and therefore, we do not anticipate the impact of a transition tax. We have remeasured our U.S. deferred tax assets at a statutory income tax rate of 21%. Since the Tax Act was passed late in the fourth quarter of 2017, and ongoing guidance and accounting interpretation are expected over the next 12 months, we consider the accounting of any transition tax, deferred tax re-measurements, and other items to be incomplete due to the forthcoming guidance and our ongoing analysis of final year-end data and tax positions. We expect to complete our analysis within the measurement period in accordance with SAB 118. At March 31, 2020 the Company had a net operating loss carry forward. These losses will start to expire in the year 2019 through 2038. No tax benefit has been reported in the financial statements because the Company believes that it is more likely than not that the carryforwards will expire unused. The utilization of future losses may be limited under various provisions of the Internal Revenue Code pertaining to continuity of business operations limits and substantial changes in ownership. Accordingly, the potential tax benefits of the loss carryforwards are offset by a valuation allowance of the same amount. The Company has no tax positions at March 31 2020 and December 31, 2019 for which the ultimate deductibility is highly certain but for which there is uncertainty about the timing of such deductibility. |
Amount Due to a Director _ The
Amount Due to a Director / The Holding Company | 3 Months Ended |
Mar. 31, 2020 | |
Related Party Transactions [Abstract] | |
Amount Due to a Director / The Holding Company | NOTE 5 - AMOUNT DUE TO A DIRECTOR / THE HOLDING COMPANY March 31,2020 December 31,2019 Amount due to a director Mr. Kong Xiao Jun 80,697 92,122 Amount due to the holding company HY (HK) Financial Investments Co., Ltd. 52,628 30,000 |
Share Capital
Share Capital | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Share Capital | NOTE 6 - SHARE CAPITAL The Company issued 1,000 shares of the Company’s common stock, par value $0.0001 per share on January 15, 2019. On January 23, 2019, Trafalgar entered into an Agreement with the Company, pursuant to which Trafalgar merged into the Company. Trafalgar’s majority stockholder who owned 5,000,000 shares (approximately 95.2%) of Trafalgar’s 5,251,309 outstanding shares of common stock, as of the close of business on January 23, 2019, signed a written consent approving the Merger and the related transactions. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Net Loss Per Common Share | Net Loss per Common Share Loss per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. There are no such common stock equivalents outstanding as of March 31, 2020. |
Income Taxes | Income Taxes The Company accounts for income taxes pursuant to FASB ASC 740-10-05, “Accounting for Income Taxes”. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets will be reflected on the balance sheet when it is determined that it is more likely than not that the asset will be realized. A valuation allowance has currently been recorded to reduce our deferred tax asset to $0. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company estimates the fair value of financial instruments using the available market information and valuation methods. The Company’s financial instruments consist of accounts payable and amount due to a related party. The carrying amount of these financial instruments approximated fair value due to the length of maturity or interest rates that approximate prevailing market rates. |
Use of Estimates | Use of estimates The presentation of financial statements and related disclosures in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities. Certain significant accounting policies that contain subjective management estimates and assumptions include those related to going concern and valuation allowance on deferred income tax. Operating results in the future could vary from the amounts derived from management’s estimates or assumptions. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements The Company has reviewed Accounting Standards Updates (“ASU”) through ASU No. 2018-05, which contain technical corrections to existing guidance or affect guidance to specialized industries or entities were recently issued. These updates have no current applicability to the Company or their effect on the financial statements would not have been significant. From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies that are adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on the Company’s financial position or results of operations upon adoption. |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) | The income tax expense (benefit) for the period ended March 31, 2020 differs from the amount computed using the federal statutory rates as follows: Three months ended Three months ended Income tax expense (benefit) at Federal tax rate of 21% for 2020 and 2019 $ (2,703 ) $ (4,929 ) Valuation allowance 2,703 4,929 - - |
Amount Due to a Director _ Th_2
Amount Due to a Director / The Holding Company (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Related Party Transactions [Abstract] | |
Schedule of Due to Related Party Transactions | March 31,2020 December 31,2019 Amount due to a director Mr. Kong Xiao Jun 80,697 92,122 Amount due to the holding company HY (HK) Financial Investments Co., Ltd. 52,628 30,000 |
Nature of Operations and Basi_2
Nature of Operations and Basis of Presentation (Details Narrative) - $ / shares | Jan. 23, 2019 | Mar. 31, 2020 | Dec. 31, 2019 | Jan. 15, 2019 |
Common stock, shares outstanding | 5,252,309 | 5,252,309 | ||
Common stock, par value | $ 0.0001 | $ 0.0001 | $ 0.0001 | |
HY (HK) Financial Investments Co., Ltd [Member] | ||||
Conversion of common stock description | Each share of Trafalgar's common stock was converted into one share of the Company's common stock. | |||
Number of shares owned for common stock | 5,001,000 | |||
Agreement [Member] | Trafalgar Resources, Inc., [Member] | ||||
Number of shares owned majority shareholder | 5,000,000 | |||
Ownership percentage | 95.20% | |||
Common stock, shares outstanding | 5,251,309 | |||
Common stock, par value | $ 0.0001 |
Significant Accounting Polici_3
Significant Accounting Policies (Details Narrative) | Mar. 31, 2020USD ($) |
Accounting Policies [Abstract] | |
Deferred tax valuation allowance | $ 0 |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) | Jan. 01, 2018 | Mar. 31, 2020 | Mar. 31, 2019 |
Income Tax Disclosure [Abstract] | |||
Corporate income tax rate percentage | 21.00% | 21.00% | 21.00% |
Income tax description | The Company does not have any foreign earnings and therefore, we do not anticipate the impact of a transition tax. We have remeasured our U.S. deferred tax assets at a statutory income tax rate of 21%. Since the Tax Act was passed late in the fourth quarter of 2017, and ongoing guidance and accounting interpretation are expected over the next 12 months, we consider the accounting of any transition tax, deferred tax re-measurements, and other items to be incomplete due to the forthcoming guidance and our ongoing analysis of final year-end data and tax positions. | ||
Income tax expired date | Expire in the year 2019 through 2038 |
Income Taxes - Schedule of Comp
Income Taxes - Schedule of Components of Income Tax Expense (Benefit) (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||
Income tax expense (benefit) at Federal tax rate of 21% | $ (2,703) | $ (4,929) |
Valuation allowance | 2,703 | 4,929 |
Income tax expense |
Income Taxes - Schedule of Co_2
Income Taxes - Schedule of Components of Income Tax Expense (Benefit) (Details) (Parenthetical) | Jan. 01, 2018 | Mar. 31, 2020 | Mar. 31, 2019 |
Income Tax Disclosure [Abstract] | |||
Federal tax rate percentage | 21.00% | 21.00% | 21.00% |
Amount Due to a Director _ Th_3
Amount Due to a Director / The Holding Company - Schedule of Due to Related Party Transactions (Details) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Due to related party | $ 80,697 | $ 92,122 |
Mr. Kong Xiao Jun [Member] | ||
Due to related party | 80,697 | 92,122 |
HY (HK) Financial Investments Co., Ltd [Member] | ||
Due to related party | $ 52,628 | $ 30,000 |
Share Capital (Details Narrativ
Share Capital (Details Narrative) - $ / shares | Jan. 23, 2019 | Jan. 15, 2019 | Mar. 31, 2020 | Dec. 31, 2019 |
Number of shares issued for common stock | 1,000 | |||
Common stock , par value | $ 0.0001 | $ 0.0001 | $ 0.0001 | |
Common stock, shares outstanding | 5,252,309 | 5,252,309 | ||
Agreement [Member] | Trafalgar Resources, Inc., [Member] | ||||
Common stock , par value | $ 0.0001 | |||
Number of shares owned majority shareholder | 5,000,000 | |||
Ownership percentage | 95.20% | |||
Common stock, shares outstanding | 5,251,309 |