Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jan. 31, 2020 | Apr. 30, 2020 | |
Equity Issuance Dollar Amount Per Share Duration One | ||
Entity Registrant Name | Hartford Great Health Corp. | |
Entity Central Index Key | 0001482554 | |
Current Fiscal Year End Date | --07-31 | |
Entity Filer Category | Non-accelerated Filer | |
Document Type | 10-Q | |
Amendment Flag | false | |
Is Entity's Reporting Status Current? | Yes | |
Document Period End Date | Jan. 31, 2020 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2020 | |
Entity's Reporting Status Current | Yes | |
Entity Incorporation, State or Country Code | DE | |
Entity File Number | 333-164633 | |
Entity Interactive Data Current | Yes | |
Entity Emerging Growth Company | true | |
Entity Small Business | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 99,108,000 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) | Jan. 31, 2020 | Jul. 31, 2019 |
Current Assets | ||
Cash and cash equivalents | $ 50,379 | $ 269,672 |
Current Loan receivable | 316,812 | 107,616 |
Prepaid and Other current receivables | 173,635 | 386,700 |
Related party receivables | 738,449 | 713,612 |
Total Current Assets | 1,279,275 | 1,477,600 |
Non-Current Assets | ||
Restricted cash, noncurrent | 28,832 | 29,052 |
Property and equipment, net | 451,741 | 253,584 |
Loan receivable, noncurrent | 0 | 200,000 |
Goodwill | 0 | 1,040,017 |
ROU assets-Operating lease | 3,815,301 | 0 |
Other assets | 701,041 | 673,634 |
Total Non-current Assets | 4,996,915 | 2,196,287 |
TOTAL ASSETS | 6,276,190 | 3,673,887 |
Current Liabilities | ||
Related party payable | 1,935,996 | 1,327,559 |
Current operating lease liabilities | 790,060 | 0 |
Other current payable | 346,028 | 175,856 |
Total Current Liabilities | 3,072,084 | 1,503,415 |
Long-term loan from related party | 588,099 | 585,146 |
Lease liabilities, noncurrent | 3,318,887 | 336,046 |
TOTAL LIABILITIES | 6,979,070 | 2,424,607 |
Stockholders' Equity | ||
Preferred stock - $0.001 par value, 5,000,000 shares authorized, no shares issued and outstanding | 0 | 0 |
Common stock - $0.001 par value, 300,000,000 shares authorized, 99,108,000 shares issued and outstanding | 99,108 | 99,108 |
Additional paid-in capital | 2,154,521 | 2,154,521 |
Accumulated deficit | (2,401,305) | (916,816) |
Accumulated other comprehensive Loss | (67,618) | (6,392) |
Noncontrolling interest | (487,586) | (81,141) |
Total Stockholders' Deficit (Equity) | (702,880) | 1,249,280 |
Total Stockholders' (Deficit) Equity | $ 6,276,190 | $ 3,673,887 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares | Jan. 31, 2020 | Jul. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value per share | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value per share | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 300,000,000 | 300,000,000 |
Common stock, shares issued | 99,108,000 | 99,108,000 |
Common stock, shares outstanding | 99,108,000 | 99,108,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jan. 31, 2020 | Jan. 31, 2019 | Jan. 31, 2020 | Jan. 31, 2019 | |
Income Statement [Abstract] | ||||
Service revenues | $ 25,684 | $ 0 | $ 55,909 | $ 0 |
Operating Expenses | ||||
Cost of revenues | 19,698 | 0 | 39,037 | 0 |
Depreciation and amortization | 9,680 | 0 | 19,232 | 0 |
Selling, general and administrative | 465,667 | 56,060 | 895,278 | 59,809 |
Goodwill impairment | 991,803 | 0 | 991,803 | 0 |
Total Operating Expenses | 1,486,848 | 56,060 | 1,945,350 | 59,809 |
Operating Loss | (1,461,164) | (56,060) | (1,889,441) | (59,809) |
Other Income (Expense) | ||||
Interest income, net | 4,072 | 0 | 7,985 | 0 |
Other (expense), net | (1,101) | (99,127) | (250) | (99,127) |
Other income (expense), net | 2,971 | (99,127) | 7,735 | (99,127) |
Loss Before Income Taxes | (1,458,193) | (155,187) | (1,881,706) | (158,936) |
Income Tax Expense | 800 | 0 | 800 | 0 |
Net Loss | (1,458,993) | (155,187) | (1,882,506) | (158,936) |
Less: Net Loss Attributable to Noncontrolling Interest | (314,498) | 0 | (398,017) | 0 |
Net Loss Attributable to Hartford Great Health Corp | $ (1,144,495) | $ (155,187) | $ (1,484,489) | $ (158,936) |
Net loss per common share: Basic and diluted | $ (0.01) | $ 0 | $ (0.01) | $ (0.01) |
Weighted average shares outstanding: Basic and Diluted | 99,108,000 | 45,840,717 | 99,108,000 | 24,429,359 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jan. 31, 2020 | Jan. 31, 2019 | Jan. 31, 2020 | Jan. 31, 2019 | |
Income Statement [Abstract] | ||||
Net Loss Attributable to Hartford Great Health Corp | $ (1,144,495) | $ (155,187) | $ (1,484,489) | $ (158,936) |
Other Comprehensive Income, Net of income tax | ||||
Foreign currency translation adjustments | (16,006) | 1,347 | (61,226) | 1,347 |
Total other comprehensive income | (16,006) | 1,347 | (61,226) | 1,347 |
Less: total other comprehensive income attributable to noncontrolling interest | 0 | 0 | 0 | 0 |
Total Other Comprehensive (Loss) Income Attributable to Hartford Great Health Corp | (16,006) | 1,347 | (61,226) | 1,347 |
Total Comprehensive Loss | $ (1,160,501) | $ (153,840) | $ (1,545,715) | $ (157,589) |
CONSOLIDATED STATEMENT OF CHANG
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT) (Unaudited) - USD ($) | Common Stock | Additional Paid-In Capital | Accumulated (Deficit) | Accumulated Other Comprehensive Income | Receivables from Sale of Stock | Noncontrolling Interest | Total |
Beginning Balance, Shares at Jul. 31, 2018 | 3,018,000 | ||||||
Beginning Balance, Amount at Jul. 31, 2018 | $ 3,018 | $ 330,241 | $ (332,647) | $ 612 | |||
Net (loss) for the period | (158,936) | (158,936) | |||||
Issuance of common stock, Shares | 96,090,000 | ||||||
Issuance of common stock, Amount | $ 96,090 | 1,825,710 | (1,305,800) | 616,000 | |||
Return of capital | (1,430) | (1,430) | |||||
Foreign currency translation adjustment | 1,347 | 1,347 | |||||
Ending Balance, Shares at Jan. 31, 2019 | 99,108,000 | ||||||
Ending Balance, Amount at Jan. 31, 2019 | $ 99,108 | 2,154,521 | (491,583) | 1,347 | $ (1,305,800) | 457,593 | |
Beginning Balance, Shares at Jul. 31, 2019 | 99,108,000 | ||||||
Beginning Balance, Amount at Jul. 31, 2019 | $ 99,108 | 2,154,521 | (916,816) | (6,392) | $ (81,141) | 1,249,280 | |
Net (loss) for the period | (1,484,489) | (398,017) | (1,882,506) | ||||
Issuance of common stock, Amount | 0 | ||||||
Investment from Noncontrolling Interest | 7,208 | 7,208 | |||||
Disposal of Noncontrolling interest | (15,636) | (15,636) | |||||
Foreign currency translation adjustment | (61,226) | (61,226) | |||||
Ending Balance, Shares at Jan. 31, 2020 | 99,108,000 | ||||||
Ending Balance, Amount at Jan. 31, 2020 | $ 99,108 | $ 2,154,521 | $ (2,401,305) | $ (67,618) | $ (487,586) | $ (702,880) |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) | 6 Months Ended | |
Jan. 31, 2020 | Jan. 31, 2019 | |
Cash flows from operating activities: | ||
Net loss including noncontrolling interests | $ (1,882,506) | $ (158,936) |
Adjustments to reconcile net loss including noncontrolling interests to net cash used in operating activities: | ||
Depreciation and amortization | 19,232 | 84 |
Amortization of deferred organization cost | 0 | 99,127 |
Goodwill impairment | 991,803 | 0 |
Disposal of Noncontrolling interest | (4,981) | 0 |
Changes in operating assets and liabilities: | ||
Prepaid and Other current receivables | 197,910 | (21,869) |
Other assets | (42,681) | 0 |
Related party receivables and payables | 587,006 | 0 |
Other current payable | 158,367 | 815 |
Operating lease assets and liabilities | (19,395) | 0 |
Net cash provided by (used in) operating activities | 4,755 | (80,779) |
Cash flows from investing activities: | ||
Cash proceeds from Acquisitions | 0 | 154 |
Cash used in Acquisitions | 0 | (141,619) |
Payments on loan receivable | 0 | (300,000) |
Purchases of property and equipment | (205,758) | 0 |
Net cash (used in) investing activities | (205,758) | (441,465) |
Cash flows from financing activities: | ||
Proceeds from issuance of common stock | 0 | 616,000 |
Contribution from noncontrolling interest | 7,104 | 0 |
Return of capital | 0 | (1,430) |
Principal payments on finance lease | (19,891) | 0 |
Proceed from borrowing | 0 | 30,000 |
Repayment of borrowing | 0 | (30,000) |
Net cash (used in) provided by financing activities | (12,787) | 614,570 |
Effect of exchange rate changes on cash | (5,723) | (399) |
Net change in Cash, cash equivalents and restricted cash | (219,513) | 91,927 |
Cash, cash equivalents and restricted cash at beginning of period | 298,724 | 1,444 |
Cash, cash equivalents and restricted cash at end of period | 79,211 | 93,371 |
Supplemental Cash Flow Information | ||
Interest paid | 0 | 0 |
Income taxes paid | $ 0 | $ 0 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jan. 31, 2020 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES This summary of significant accounting policies is presented to assist in understanding the Company's financial statements. The financial statements and notes are the responsibility of the Company's management. These accounting policies conform to accounting principles generally accepted in the United States of America ("US GAAP") and have been consistently applied in the preparation of the financial statements. Organization: Hartford Great Health Corp. was originally incorporated in the State of Nevada on April 2, 2008 under the name PhotoAmigo, Inc. It changed its name to Hartford Great Health Corp. on August 22, 2018 and since then we have been engaged in activities to formulate and implement our business plans. On December 28, 2018, the Company acquired Hangzhou Hartford Comprehensive Health Management, Ltd (“HZHF”). On March 22, 2019, the Company acquired 60 percent of Hangzhou Longjing Qiao Fu Vacation Hotel Co., Ltd. (“HZLJ”). On March 20, 2019, the Company acquired Shanghai Hartford Comprehensive Health Management, Ltd. (“HFSH”) and its 90 percent owned subsidiary - Shanghai Qiao Garden International Travel Agency (“Qiao Garden Int’l Travel”), and formed a joint venture entity, Hartford International Education Technology Co., Ltd (“HF Int’l Education”) at the same month. On July 24, 2019, HF Int’l Education established a 100% owned subsidiary, Pudong Haojin Childhood Education Ltd. (“PDHJ”). Basis of Presentation: Use of Estimates: Foreign Currency: Comprehensive Income (loss): Fair value measurement: Level 1 - Quoted prices in active markets for identical assets or liabilities or funds. Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company’s financial instruments consist of cash and cash equivalents, accounts receivable, current loan receivable, related party receivable, prepaid and other current receivable, accounts payable, related party payable and other current payable. The carrying amounts of afore-mentioned accounts approximate fair value because of their short-term nature. Cash and Cash Equivalents: Financial instruments that potentially subject the Company to significant concentrations of credit risk are cash and cash equivalents and accounts receivable. As of January 31, 2020, none of the Company’s cash and cash equivalents held by financial institutions was uninsured. With respect to accounts receivable, the Company generally does not require collateral and does not have an allowance for doubtful accounts. Loans and Receivables: Property and equipment, net: Years Leasehold improvements Lesser of lease term or estimated useful life ROU assets-Finance lease Lease term Furniture and fixtures 3-5 Office equipment and vehicles 3-5 Computer software 3-5 Expenditures for repairs and maintenance are charged to expense as incurred. Goodwill and Long-lived Assets: The Company has the option to assess goodwill for possible impairment by performing a qualitative analysis to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. A quantitative assessment is performed if the qualitative assessment results in a more-likely-than-not determination or if a qualitative assessment is not performed. The quantitative assessment considers whether the carrying amount of a reporting unit exceeds its fair value, in which case an impairment charge is recorded to the extent that the reporting unit’s carrying value exceeds its fair value. The Company’s goodwill was generated from the acquisitions during the year ended July 31, 2019. We currently have two reporting units - Hospitality and Early Childhood Education. Given the impact of COVID-19 pandemic and the unfavorable operation results, an interim goodwill impairment assessment is performed as of January 31, 2020. Based on the assessment result, management determined that the goodwill was fully impaired as of January 31, 2020. Business Combinations: Noncontrolling interest: Advertising costs: Income Taxes: On December 22, 2017, the President of the United States signed into law the Tax Reform Act. The Tax Reform Act permanently reduces the U.S. corporate income tax rate from a maximum of 35% to a flat 21% rate, effective January 1, 2018. In addition, the 2017 Tax Act also creates a new requirement that certain income (i.e., Global Intangible Low-Taxed Income (“GILTI”)) earned by controlled foreign corporations (“CFCs”) must be included in the gross income of the CFCs’ U.S. shareholder income. The tax law in PRC applies an income tax rate of 25% to all enterprises. The Company’s subsidiary does not receive any preferential tax treatment from local government. The Company has been in loss position for years and zero balances of tax provisions, deferred tax assets and liabilities as of the reporting periods ended. The tax reforms have no significant impacts on the Company. Revenue Recognition: Income (Loss) Per Share: Recent Accounting Pronouncements: Recently issued accounting pronouncements not yet adopted In December 2019, the FASB issued Accounting Standards Update (“ASU”) 2019-12, “Simplifying the Accounting for Income Taxes”, as part of its simplification initiative to reduce the cost and complexity in accounting for income taxes. ASU 2019-12 removes certain exceptions related to the approach for intra-period tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. ASU 2019-12 also amends other aspects of the guidance to help simplify and promote consistent application of GAAP. The guidance is effective for fiscal years beginning after December 15, 2020, with early adoption permitted. The Company is currently evaluating the impact of ASU 2019-12 on its financial position, results of operations and liquidity. In August 2018, the FASB issued ASU No. 2018-13, “Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement.” ASU No. 2018-13 removes certain disclosure requirements related to the fair value hierarchy, modifies existing disclosure requirements related to measurement uncertainty and adds new disclosure requirements. ASU No. 2018-13 disclosure requirements include disclosing the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements held at the end of the reporting period and the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. ASU No. 2018-13 is effective for the Company within those fiscal years beginning on December 15, 2019, with early adoption permitted. Certain disclosures in the new guidance will need to be applied on a retrospective basis and others on a prospective basis. The Company does not expect that the adoption of ASU No. 2018-13 will have a material impact on its financial position, results of operations and liquidity. In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments”. The accounting standard changes the methodology for measuring credit losses on financial instruments and the timing when such losses are recorded. ASU No. 2016-13 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2019. Early adoption is permitted for fiscal years, and interim periods within those years, beginning after December 15, 2018. The Company does not expect that the adoption of ASU No. 2016-13 will have a material impact on its financial position, results of operations and liquidity. Recently adopted accounting pronouncements In February 2018, the FASB issued ASU No. 2018-02, “Income Statement - Reporting Comprehensive Income (Topic 220)”, which amends the previous guidance to allow for certain tax effects “stranded” in accumulated other comprehensive income, which are impacted by the Tax Cuts and Jobs Act (the “Tax Reform Act”) , to be reclassified from accumulated other comprehensive income into retained earnings. This amendment pertains only to those items impacted by the new tax law and will not apply to any future tax effects stranded in accumulated other comprehensive income. This standard is effective for fiscal years beginning after December 15, 2018 and allows for early adoption. The adoption of ASU No. 2018-02 did not have an impact on the Company’s financial position, results of operations and liquidity. In January 2017, the FASB issued ASU No. 2017-04, “Intangibles and Other (Topic 350): Simplifying the Test for Goodwill Impairment”, which eliminates the requirement to calculate the implied fair value of goodwill, but rather requires an entity to record an impairment charge based on the excess of a reporting unit’s carrying value over its fair value. This amendment is effective for annual or interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption is permitted. The Company early adopted ASU No. 2017-04 when we tested goodwill impairment as of January 31, 2020. Management determined the goodwill was fully impaired as of January 31, 2020. In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)”. ASU No. 2016-02 requires the recognition of lease assets and lease liabilities on the balance sheet for leases classified as operating leases under previous guidance. The accounting for finance leases (capital leases) was substantially unchanged. The original guidance required application on a modified retrospective basis with adjustments to the earliest comparative period presented. In August 2018, the FASB issued ASU No. 2018-11, “Targeted Improvements to ASC 842,” which included an option to not restate comparative periods in transition and elect to use the effective date of ASU No. 2016-02 as the date of initial application, which the Company elected. As a result, the consolidated balance sheet prior to August 1, 2019 was not restated, and continues to be reported under previous guidance that did not require the recognition of operating lease liabilities and corresponding lease assets on the consolidated balance sheet. The cumulative effect of the changes made to our Condensed Consolidated Balance Sheet at August 1, 2019 for the adoption of the new lease standard was as follows: Balance at Balance at July 31, 2019 Adjustments August 1, 2019 Assets: Prepaid and Other current receivables 386,700 (74,197 ) 312,503 ROU assets-Operating lease — 4,185,827 4,185,827 Liabilities: Current Operating Lease liabilities — 651,424 651,424 Operating lease liabilities — 3,481,229 3,481,229 The adoption of ASU No. 2016-02 had an immaterial impact on the Company’s condensed Consolidated Statement of Operation and condensed Consolidated Statement of Cash Flows for the six months ended January 31, 2020. In addition, the Company elected the package of practical expedients permitted under the transition guidance within the new standard, which allowed the Company to carry forward the historical lease classification, not reassess prior conclusions related to expired or existing contracts that are or that contain leases, and not reassess the accounting for initial direct costs. Operating leases with a term of 12 months or less will not be recorded on the Consolidated Balance Sheet. Additional information and disclosures required by ASU No. 2016-02 are contained in Note 11 Leases. |
GOING CONCERN
GOING CONCERN | 6 Months Ended |
Jan. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
GOING CONCERN | NOTE 2. GOING CONCERN The accompanying financial statements were prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of obligations in the normal course of business. However, Hartford Great Health Corp.'s operations has incurred losses since inception, resulting in an accumulated deficit of $ 2,401,305 and $916,816 as of January 31, 2020 and July 31, 2019, respectively. The Company’s operation provided cash flow of $4,755 for the six months ended January 31, 2020 and negative cash flow of $80,779 for the six months ended January 31, 2019. These conditions raise substantial doubt about the ability of Hartford Great Health Corp. to continue as a going concern. In view of these matters, continuation as a going concern is dependent upon several factors, including the availability of debt or equity funding upon terms and conditions acceptable to Hartford Great Health Corp., and ultimately achieving profitable operations. Management believes that Hartford Great Health Corp.'s business plan provides it with an opportunity to continue as a going concern. However, management cannot provide assurance that Hartford Great Health Corp. will meet its objectives and be able to continue in operation. The financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the possible inability of Hartford Great Health Corp. to continue as a going concern. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 6 Months Ended |
Jan. 31, 2020 | |
Stockholders' Equity | |
STOCKHOLDERS' EQUITY | NOTE 3. STOCKHOLDERS' EQUITY Preferred Stock The Company is authorized to issue 5,000,000 shares of preferred stock with a par value of $0.001 per share. No shares of preferred stock have been issued or outstanding since Inception (April 2, 2008). Common Stock The Company is authorized to issue 300,000,000 shares of common stock with a par value of $0.001 per share. On December 11, 2018, 96,090,000 shares of common stock were issued at the price of $0.02 per share to raise $1,921,800 capital in cash. As of January 31, 2020 and July 31, 2019, the company has issued a total of 99,108,000 shares of common stock. |
ACQUISITIONS AND JOINT VENTURES
ACQUISITIONS AND JOINT VENTURES | 6 Months Ended |
Jan. 31, 2020 | |
Notes to Financial Statements | |
ACQUISITIONS AND JOINT VENTURES | NOTE 4. ACQUISITIONS AND JOINT VENTURES Acquisition of HZHF On December 28, 2018, the Company acquired HZHF from an unrelated individual, an entity located at Hangzhou, China. The operation results of HZHF are included in the Company’s consolidated financial statements commencing on the acquisition date. The Company has recorded an allocation of the purchase price to the Company’s identifiable assets acquired based on their fair value at the acquisition date. No business inputs, process and workforce have been acquired through the transaction. The Company accounted the transaction in accordance with the Asset Acquisitions The calculation of purchase price and purchase price allocation is as following: Identifiable Assets Acquired Cash and cash equivalents $ 154 Other current assets 37,964 Property and equipment, net 4,038 Deferred Start-up cost, noncurrent 99,463 Total Consideration $ 141,619 Right after the transaction was consummated, the Company fully expensed the deferred start-up cost in accordance with US GAAP. Acquisition of HZLJ On March 22, 2019, HZHF acquired 60 percent ownership interest of HZLJ from Shanghai Qiao Garden Property Management Group, Ltd (“Qiao Garden Group”), an affiliate on which the Company’s management has significant influence. The acquisition expands the Company's capabilities in the travel and health management sectors as the hotel is located within walking distance of local tea farms and a protected nature preserve. The results of operations of the acquired subsidiary are included in the Company’s consolidated financial statements commencing on the acquisition date. The Company has recorded an allocation of the purchase price to the Company’s tangible and identifiable intangible assets acquired and liabilities assumed based on their fair value at the acquisition date. The Company accounted the acquisition transaction in accordance with FASB ASC 805, Business Combinations, under acquisition accounting method. The Company classifies the 40 percent ownership interest held by Shanghai Qiaohong Real Estate Co., Ltd., a related party, as "Noncontrolling interest" on the Consolidated Balance Sheet. The related transaction costs were immaterial and included in General and administrative expenses in the accompanying Consolidated Statements of Operations. The calculation of purchase price and purchase price allocation is as follows: Assets Acquired and Liabilities Assumed Cash and cash equivalents $ 15,383 Accounts and Other receivables 13,224 Related party receivable 22,861 Property and Equipment, net 247,940 Other assets 699,066 Goodwill 466,847 Accounts payable (2,671 ) Related party payable (1,232,512 ) Other account payable (28,772 ) Other liabilities (336,051 ) Noncontrolling interest 240,613 Total consideration * $ 105,928 *$16,537 payable due from HZLJ waived by HFHZ plus $89,891 (RMB600,000) cash payment totaled $105,928 consideration for the acquisition. Goodwill is mainly attributable to synergies expected from the acquisition in hospitality industry and assembled workforce. Other assets and other liabilities are related to the deferred cost of obtaining the finance lease and the finance lease liabilities (see Note 11 Lease). Related party payable consisted the unpaid portion of operating advances made to HZLJ by the affiliates which are under common control by the same management. Amount of $595,939 were due to Qiao Garden Group, which originally owned 60% of HZLJ. And amount of $596,348 were advanced from Shanghai DuBian Assets Management Ltd., which is controlled by the same management. These advances do not bear interest and are considered due on demand. Property and Equipment, net mainly consists of ROU assets, Furniture and fixtures and office equipment. Acquisition of HFSH On March 20, 2019, the Company acquired HFSH and its 90 percent owned subsidiary - Shanghai Qiao Garden International Travel Agency (“Qiao Garden Intl Travel”) from an unrelated individual. The original intent behind the acquisition was to use the travel agency to manage travel and lodging arrangements between China and the US for Chinese members of the anti-aging stem-cell treatment program. The results of operations of the acquired entities are included in the Company’s consolidated financial statements commencing on the acquisition date. The Company has recorded an allocation of the purchase price to the Company’s tangible and identifiable intangible assets acquired and liabilities assumed based on their fair value at the acquisition date. The Company accounted the acquisition transaction in accordance with FASB ASC 805, Business Combinations, under acquisition accounting method. The Company classifies the un-acquired 10 percent ownership interest as "Noncontrolling interest" on the consolidated balance sheet. The related transaction costs were immaterial and included in General and administrative expenses in the accompanying consolidated statements of operations. The calculation of purchase price and purchase price allocation is as follows: Assets Acquired and Liabilities Assumed Cash and cash equivalents $ 35,886 Accounts and Other receivables 92,120 Property and Equipment, net 6,511 Other assets 791,445 Goodwill 573,170 Accounts payable (3,126 ) Related party payable (1,073,380 ) Noncontrolling interest (63,911 ) Total consideration * $ 358,715 *$223,477 payable due to HFHZ waived plus $135,238 (RMB907,737) cash payment totaled $358,715 consideration for the acquisition. Goodwill is mainly attributable to synergies expected from the acquisition of travel agency license and assembled workforce. Amount of $677,463 related party receivable is due from Shanghai Qiaohong Real Estate Co., Ltd. (“SH Qiaohong”), owning 40 percent equity interest of HZLJ. HFSH loaned the amount to SH Qiaohong for two years on June 21, 2018, the related party loan bears annual interest of six percent. The balance will be paid back by June 30, 2020. Amount of $109,355 is due from one of the directors for business trips and business developing expenses and the amount is going to be reimbursed or paid back within three months. The remaining related party receivable are the operating advances made to multiple companies which are under common control by the same management. These advances do not bear interest and are considered due on demand. Related party payable consisted the unpaid portion of operating advances made to HFSH by the affiliates which are under common control by the same management. These advances do not bear interest and are considered due on demand. The majority advances, amount of $990,665 were from SH Qiaohong. HFSH used the amount for start-up expense and acquisition of 90 percent ownership of Qiao Garden Intl Travel acquisition. Joint Venture – HF Int’l Education Effective on March 22, 2019, HFSH entered into a joint venture agreement with SH Jingyu and one individual investor, to form a new entity Hartford International Education Technology Co., Ltd (“HF Int’l Education”) to provide childcare education services. The joint venture is owned 65% by HFSH, 20% by SH Jingyu and 15% by another individual investor. On July 11, 2019, another agreement has been entered by HFSH, SH Jingyu, the individual investor and another new investor, Shanghai Hao Zhong Ji Educational Tech LLP (“SHHZJ”). Based on this agreement, the joint venture is owned 58.5% by HFSH, 18% by SH Jingyu, 10% by SHHZJ and 13.5% by the individual investor. On December 26, 2019, the individual investor disposed 2.5% ownership to HFSH and 11% ownership to another two new individual investors. A new ownership agreement has been entered between HFSH, SH Jingyu, SHHZJ and two new individuals. Based on the new agreement, the ownership of joint venture was further changed to: 61.0% by HFSH and 39% by four noncontrolling shareholders in total. HFSH is responsible for the overall development and operation of HF Int’l Education. As a result, HFSH has the majority voting interest with primary beneficiary. The results of operations of HF Int’l Education are included in the Company’s consolidated financial statements commencing on the formation date. The Company classifies the 39.0% ownership interest held by other four parties as "Noncontrolling interest" on the consolidated balance sheet. The registered capital for HF Intl Education is RMB 5 million. As of January 31, 2020, amount of RMB 3.5 million or USD 497,715 capital were injected and the remaining of RMB 1.5 million or USD 223,089 is to be contributed by the shareholders. On July 24, 2019, HF Int’l Education established a wholly owned subsidiary, Pudong Haojin Childhood Education Ltd. (“PDHJ”) to provide childcare education services. Pro Forma Information The following unaudited pro forma information has been prepared for illustrative purposes only, assumes that the acquisition occurred on August 1, 2018 and includes pro forma adjustments related to the noncontrolling interest allocation and the issuance of 96,090,000 common shares to finance the acquisitions. The unaudited pro forma results have been prepared based on estimates and assumptions, which we believe are reasonable; however, they are not necessarily indicative of the consolidated results of operations had the acquisition occurred on August 1, 2018, or of future results of operations. The unaudited pro forma results are as follows: Three months ended January 31, Six months ended January 31, 2020 2019 2020 2019 Revenues $ 25,684 $ 11,197 $ 55,909 $ 40,906 Net Loss (1,458,993 ) (283,436 ) (1,882,506 ) (484,716 ) Less: Net Loss Attributable to Noncontrolling Interest (314,498 ) (23,817 ) (398,017 ) (31,454 ) Net Loss Attributable to Hartford Great Health Corp $ (1,144,495 ) $ (259,619 ) $ (1,484,489 ) $ (453,262 ) Weighted average shares outstanding: Basic and diluted 99,108,000 99,108,000 99,108,000 99,108,000 Net loss per common share: Basic and Diluted (0.01 ) (0.00 ) (0.01 ) (0.00 ) Others On January 27, 2019, HFSH entered an agreement with Shanghai Qiao Garden Property Management Group to acquire 85 percent ownership of Shanghai Senior Health Consulting Ltd. (“SH Senior”). On January 28, 2019, HFUS entered an agreement to acquire 100 percent equity interest of Shanghai Luo Sheng International Trade Ltd. (“SH Luosheng”). On February 24, 2019, HFSH entered an agreement to acquire 55 percent ownership of Shanghai Pasadena Ltd. (“SH Pasadena”). During May and June 2019, the Company entered an agreement and a supplemental agreement to acquire 60 percent equity interest of Shanghai Ren Lai Ren Wang Restaurant Co., Ltd. (“SH RLRW”). As of January 31, 2020, these acquisition agreements have not yet taken effect as no consideration has been paid toward those acquisitions. These agreements will be executed when the Company is financially ready to move forward, and the purchase price will be calculated based on the net assets of each entity on the execute date. There was no penalty levied or to be levied due to delayed execution or no-execution of those agreements. |
RESTRICTED CASH
RESTRICTED CASH | 6 Months Ended |
Jan. 31, 2020 | |
Cash and Cash Equivalents [Abstract] | |
RESTRICTED CASH | NOTE 5. RESTRICTED CASH The restricted cash is collateral required by the local government in China for Qiao Garden Int’l Travel, acquired with its parent company HFSH on March 20, 2019, to maintain its business certificate. The Company early adopted Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash, which requires that restricted cash be included with cash and cash equivalents when reconciling the beginning of year and end of year total amounts shown on the statements of cash flows. ASU-2016-18 is effective for the years beginning after December 31, 2019, with early adoption permitted. The Company early adopted the provision of ASU 2016-18. The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the balance sheets that sum to the total of the same such amounts shown in the statements of cash flows. January 31, 2020 January 31, 2019 (unaudited) (unaudited) Cash and cash equivalents $ 50,379 $ 93,371 Restricted cash, noncurrent 28,832 — Total cash, cash equivalents and restricted cash shown in the statement of cash flows $ 79,211 $ 93,371 |
LOAN RECEIVABLES, CURRENT AND N
LOAN RECEIVABLES, CURRENT AND NONCURRENT | 6 Months Ended |
Jan. 31, 2020 | |
Receivables [Abstract] | |
LOAN RECEIVABLES, CURRENT AND NONCURRENT | NOTE 6. LOAN RECEIVABLES, CURRENT AND NONCURRENT The Company loaned $99,870 to a third party, Longsheng Aquatic Products Co., Ltd. The loan bears annual interest rate of six percent. The term of loan started from February 14, 2019 and extended for one more year to May 13, 2020 on May 12, 2019. $1,531 and $ 3,063 of interest income were recognized during the three months and six months ended January 31, 2020, respectively. Total interest receivable of $5,843 and $2,780 were accrued as of January 31, 2020 and July 31, 2019, respectively. The Company loaned $300,000 to a third party, Hong Kong Hong Tai Int’l Trade Limited. The loan bears annual interest rate of six percent. The term of loan is six months till June 27, 2019. On February 5, 2019, the loan has been fully paid back with $1,923 interest charges. The Company loaned another $200,000 to Hong Kong Hong Tai Int’l Trade Limited. The loan bears annual interest rate of six percent. The term of loan started from March 4, 2019 and extended to September 3, 2020 on August 30, 2019. $3,067 and $6,133 of interest income were recognized during the three months and six months ended January 31, 2020, respectively. Total interest receivable of $11,100 and $4,967 were accrued as of January 31, 2020 and July 31, 2019, respectively. Loan receivables are not exposed to market risk due to the stable and fixed interest rates in accordance with the loan agreements. The estimated fair value of long-term loan receivable was approximately $0 and $204,561 as of January 31, 2020 and July 31, 2019, respectively. |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 6 Months Ended |
Jan. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT, NET | NOTE 7. PROPERTY AND EQUIPMENT, NET Property and equipment, net consists of the following at January 31, 2020 and July 31, 2019: January 31, 2020 (unaudited) July 31, 2019 Leasehold improvements $ 23,190 $ 23,366 Finance lease assets 270,799 272,860 Furniture and fixtures 233,581 235,360 Office equipment and vehicles 76,620 68,859 Construction in progress 200,493 — 804,683 600,445 Less: accumulated depreciation and amortization (352,942 ) (346,861 ) $ 451,741 $ 253,584 Depreciation expense for the three and six months ended January 31, 2020 were $ 4,311 and $ 8,576, respectively. Depreciation expense for the three and six months ended January 31, 2019 were both of $84. |
OTHER ASSETS
OTHER ASSETS | 6 Months Ended |
Jan. 31, 2020 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
OTHER ASSETS | NOTE 8. OTHER ASSETS Other assets consist of the following at January 31, 2020 and July 31, 2019: January 31, 2020 (unaudited) July 31, 2019 Other miscellaneous assets $ 43,307 $ — Deferred cost of finance lease, net 657,734 673,634 $ 701,041 $ 673,634 The cost of obtaining the finance lease of the land use rights and hotel building at HZLJ, which was acquired by the Company on March 22, 2019, in the amount of $879,800 (RMB 6 million) was recognized as Other Assets and subject for amortization over the lease term, 41 years commenced on October 2010. The amortization is computed using the straight-line method over the lease term. Amortization expense of deferred cost of finance lease for the three and six months ended January 31, 2020 was $5,369 and $10,656, respectively. Amortization expense of deferred cost of finance lease for the three and six months ended January 31, 2019 was $0. The future amortization schedule for the other assets related to the cost of obtaining the finance lease as of January 31, 2020 is as following: 2020 (excluding the six months ended January 31, 2020) $ 10,812 2021 21,624 2022 21,624 2023 21,624 2024 21,624 2025 and thereafter 560,426 Total $ 657,734 |
GOODWILL
GOODWILL | 6 Months Ended |
Jan. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL | NOTE 9. GOODWILL Our goodwill was contributed by the acquisitions during 2019. Under the circumstance of the COVID-19 pandemic and slowly economic recoveries at Shanghai and Hangzhou city, the Company’s business plans have been halted for an indefinite period of time. Based on the interim assessment of goodwill impairment performed, management determined that goodwill was fully impaired as of January 31, 2020. The following is a roll-forward of goodwill for the year ended July 31, 2019 and for the six months ended January 31, 2020: HZHF & HZLJ HFSH and Qiao Garden Int'l Travel Total Balance at July 31, 2018 $ — $ — $ — Acquisitions 466,847 573,170 1,040,017 Impairment — — — Balance at July 31, 2019 $ 466,847 $ 573,170 $ 1,040,017 Acquisitions — — — Impairment (451,732 ) (554,611 ) (1,006,343 ) Foreign Exchange (15,115 ) (18,559 ) (33,674 ) Balance at January 31, 2020 (unaudited) $ — $ — $ — |
OTHER CURRENT PAYABLE
OTHER CURRENT PAYABLE | 6 Months Ended |
Jan. 31, 2020 | |
Payables and Accruals [Abstract] | |
OTHER CURRENT PAYABLE | NOTE 10. OTHER CURRENT PAYABLE The following is a breakdown of the accounts and other payables as of January 31, 2020 and July 31, 2019: January 31, 2020 (unaudited) July 31, 2019 Payable to Acquiree $ 130,860 $ 131,856 Current Lease Liability-Financing lease 20,903 — Deferred revenue 76,439 — Other payable 117,826 44,000 $ 346,028 $ 175,856 Payable to acquiree is the unpaid consideration for the acquisitions described in Note 4 Acquisitions and Joint Venture. |
LEASE
LEASE | 6 Months Ended |
Jan. 31, 2020 | |
Notes to Financial Statements | |
LEASE | NOTE 11. LEASES At the inception of a contract, the Company assesses whether the contract is, or contains, a lease. The Company’s assessment is based on: (1) whether the contract involves the use of a distinct identified asset, (2) whether the Company obtains the right to substantially all the economic benefit from the use of the asset throughout the term, and (3) whether the Company has the right to direct the use of the asset. Leases are classified as either finance leases or operating leases based on criteria in Accounting Standards Codification (“ASC”) 842. Operating leases are included in ROU assets-Operating lease, Current Operating Lease liabilities and Operating lease liabilities, finance leases are included in Property and Equipment and Other Liabilities in the condensed Consolidated Balance Sheet. Right-of-use (“ROU”) assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. As the lease did not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the lease commencement date in China market. ROU assets also include any lease payments made and exclude lease incentives. Lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for operating leases, consisting of lease payments, is recognized on a straight-line basis over the lease term. Lease expense for finance leases consists of the amortization of the ROU asset on a straight-line basis over the asset’s estimated useful life and interest expense is calculated using the amortized cost basis. As of January 31, 2020, the Company has multiple operating leases for office spaces and a finance lease of land and hotel building. Our operating leases have remaining lease terms ranging from two years to six years, with various term extensions available. Our finance lease has remaining lease term of thirty-two years. The Company has elected not to recognize ROU assets and lease liabilities for short-term operating leases that have a term of twelve months or less. The finance lease was obtained through HZLJ acquisition on March 22, 2019 (See Note 4 Acquisitions and Joint Venture). On October 1, 2010, HZLJ leased the land and hotel building for 41 years. Finance lease right-of-use assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent the Company's obligation to make lease payments arising from the lease. Lease-related assets and liabilities at January 31, 2020 and July 31, 2019 were as follows: January 31, July 31, 2020 (unaudited) 2019 Assets Finance lease right-of-use assets, cost $ 270,799 $ 272,860 Less: accumulated amortization (61,645 ) (58,787 ) Finance lease right-of-use assets, net 209,154 214,073 ROU assets-Operating lease 3,815,301 — Total Lease ROU assets $ 4,024,455 $ 214,073 Liabilities Current Operating Lease liabilities $ 790,060 $ — Other current payable-Finance leases 20,903 20,336 Operating lease liabilities, noncurrent 3,013,797 — Finance lease liabilities, noncurrent 305,090 315,710 Total Lease liabilities $ 4,129,850 $ 336,046 The components of lease cost for the three and six months ended January 31, 2020 was as follows: Three months ended Six months ended January 31, 2020 (unaudited) January 31, 2020 (unaudited) Operating lease cost $ 259,589 $ 463,159 Finance leases: Amortization of ROU assets 1,675 3,302 Interest on finance lease liabilities 6,426 12,668 Finance lease cost 8,101 15,970 Total lease cost $ 267,690 $ 479,129 Supplemental cash flow information for leases for the six months ended January 31, 2020 was as follows: Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 327,895 Financing cash flows from finance leases 19,891 The weighted-average remaining lease term and weighted-average discount rate for operating and finance leases at January 31, 2020 was as follows: Operating Leases Finance Leases Weighted-average remaining lease term (years) 4.0 32 Weighted-average discount rate 8 % 8 % The following table reconciles the undiscounted future minimum lease payments for operating and finance leases executed at January 31, 2020: Operating Leases Finance Leases 2020 (excluding the six-months ended January 31, 2020) $ 474,691 $ — 2021 1,142,081 20,903 2022 1,003,176 21,624 2023 664,306 22,345 2024 583,026 23,066 2025 and thereafter 687,325 938,487 Total lease payments $ 4,554,605 $ 1,026,425 Less interest (750,748 ) (700,432 ) Present value of future lease payments $ 3,803,857 $ 325,993 Current Lease liabilities 790,060 20,903 Noncurrent Lease liabilities 3,013,797 305,090 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended |
Jan. 31, 2020 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 12. RELATED PARTY TRANSACTIONS Equity Transactions On October 2018, the Company refunded $1,429 of the additional paid in capital to the former CFO. On December 11, 2018, the Company sold 96,090,000 shares of its common stock to various investors, including 54,040,000 shares sold to its Officers and Directors with proceeds of $1,080,800. The whole amount of proceeds has been collected. Related Party Receivables As of January 31, 2020 and July 31, 2019, amount of $688,660 and $674,524, respectively, is due from Shanghai Qiaohong Real Estate Co., Ltd. (“SH Qiaohong”), the noncontrolling interest of Longjing. The balance was acquired through HFSH acquisition. HFSH loaned the amount to SH Qiaohong for two years on June 21, 2018 bearing annual interest of six percent. The balance will be paid back by June 30, 2020. $9,549 and $18,953 of interest income were recognized during the three and six months ended January 31, 2020. The remaining related party receivable of $49,789 and $39,088 as of January 31, 2020 and July 31, 2019, respectively, represents the operating advances made to the affiliates which are managed by the same management team. These advances do not bear interest and are considered due on demand. On October 2018, the Company borrowed $30,000 from a potential investor to fund the Company's ongoing activities. It was an indefinite short-term loan with no interest bearing. The loan was paid back by the Company in the following quarter. Related Party Payables As of January 31, 2020 and July 31, 2019, amount of $678,574 and $526,963, respectively, is payable to SH Qiaohong. Majority of the balance was part of the liability assumed through HFSH acquisition. This payable balance does not bear interest and due on demand. As of January 31, 2020 and July 31, 2019, amount of $598,267 and $602,821, respectively, is payable to Shanghai Qiao Garden Property Management Group (“Qiao Garden Group”), an entity managed by the same management team. The balance was part of the liability assumed through HZLJ acquisition. This payable balance does not bear interest and is considered due on demand. The remaining related party payable of $659,155 and $197,775 as of January 31, 2020 and July 31, 2019, respectively, represents the unpaid portion of operating advances made to the Company by following affiliates which are managed by the same management team. These advances do not bear interest and are considered due on demand. January 31, 2020 (unaudited) July 31, 2019 Shanghai Senior Investment Ltd. $ 58,957 $ 106,866 Shanghai Oversea Chinese Culture Media Ltd. 564,885 50,808 Various affiliates 35,313 40,101 $ 659,155 $ 197,775 As of January 31, 2020 and July 31, 2019, the Company has $588,099 and $585,146, respectively, long-term payable to Shanghai DuBian Assets Management Ltd., which is owned by the Company’s CEO’s relative. The payable balance was assumed from the acquisition transaction. On April 30, 2019, both parties entered a long-term agreement to convert the payable to long term debt, which expires on April 30, 2021, bearing approximately 2.5 percent of annual interest. $3,661 and $ 7,267 of interest expense were recognized during the three and six months ended January 31, 2020, respectively. The unpaid principle and interest will be due on the maturity date. This loan payable is not exposed to market risk due to the stable and fixed interest rates in accordance with the loan agreements. As of January 31, 2020 and July 31, 2019, the estimated fair value of long term loan payable was approximately $587,525 and $584,674, respectively. Other Related Party Transactions Office space is provided to Hartford Great Health Corp. at no additional cost by the sole executive officer. No provision for these costs has been included in these financial statements as the amounts are not material. On September 30, 2019, HF Int’l Education entered a long-term debt agreement with a related party, SH Qiao Hong. The debt agreement provides a line of credit up to RMB9.0 million and expires on September 30, 2021, bearing approximately 3.0 percent of annual interest. The unpaid principle and interest will be due on the maturity date. On September 30, 2019, HF Int’l Education entered another long-term debt agreement with a related party, Shanghai Oversea Chinese Culture Media Ltd. The debt agreement provides a line of credit up to RMB 5.0 million and expires on September 30, 2021, bearing approximately 3.0 percent of annual interest. The unpaid principle and interest will be due on the maturity date. As of January 31, 2020, no balance has been borrowed from these two related parties by HF Int’l Education. |
COMMITMENTS
COMMITMENTS | 6 Months Ended |
Jan. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS | NOTE 13. COMMITMENTS There has been no material contractual obligations and other commitments except the lease commitments disclosed in Note 11 Leases. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 6 Months Ended |
Jan. 31, 2020 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | NOTE 14. SEGMENT INFORMATION The Company currently operates in following industry segments: hospitality (hotel and travel agency) and early childhood education industry in China. Segment information on assets as of January 31, 2020 and revenue generated during the six months ended January 31, 2020, as follows: Hospitality Education Corporate and unallocated Total Revenue $ 44,386 $ 11,523 $ — $ 55,909 Operating loss (1,368,260 ) (410,199 ) (110,982 ) (1,889,441 ) Operating loss before tax (1,720,904 ) (59,015 ) (101,787 ) (1,881,706 ) Net Loss attributable to Hartford Great Health Corp (1,117,444 ) (264,458 ) (102,587 ) (1,484,489 ) Total assets (excluding Intercompany balances) 1,846,219 3,397,315 1,032,656 6,276,190 As of July 31, 2019, the company only operated in hospitality industry in China. The subsidiary had an amount of $2,547,989 in total assets, excluding inter-company balances, and it generated $56,174 in revenue. There was no revenue generated from inter-company transactions. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jan. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 15. SUBSEQUENT EVENTS In accordance with ASC 855 , "Subsequent Events" In March 2020, HF International Education established Shanghai Hongkou HaiDeFuDe Childcare Co., Ltd. and was approved the business license to conduct childcare operations in Shanghai, China. No actual business has been done thus far. On April 13, 2020, HFSH and HF International Education received Notices of Lease Termination from the landlord. HFSH and HF International Education then filed a civil case against the landlord for return the over-charged rent expense because of fictitious office size, approximately $260,000 (RMB1.8 million) and continue to execute the lease agreements. An initial trial is scheduled in May 2020. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jan. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation: |
Use of Estimates | Use of Estimates: |
Foreign Currency | Foreign Currency: |
Comprehensive Income (loss) | Comprehensive Income (loss): |
Fair value measurement | Fair value measurement: Level 1 - Quoted prices in active markets for identical assets or liabilities or funds. Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company’s financial instruments consist of cash and cash equivalents, accounts receivable, current loan receivable, related party receivable, prepaid and other current receivable, accounts payable, related party payable and other current payable. The carrying amounts of afore-mentioned accounts approximate fair value because of their short-term nature. |
Cash and Cash Equivalents | Cash and Cash Equivalents: Financial instruments that potentially subject the Company to significant concentrations of credit risk are cash and cash equivalents and accounts receivable. As of January 31, 2020, none of the Company’s cash and cash equivalents held by financial institutions was uninsured. With respect to accounts receivable, the Company generally does not require collateral and does not have an allowance for doubtful accounts. |
Loans and Receivables | Loans and Receivables: |
Property and equipment, net | Property and equipment, net: Years Leasehold improvements Lesser of lease term or estimated useful life ROU assets-Finance lease Lease term Furniture and fixtures 3-5 Office equipment and vehicles 3-5 Computer software 3-5 Expenditures for repairs and maintenance are charged to expense as incurred. |
Goodwill and Long-lived Assets | Goodwill and Long-lived Assets: The Company has the option to assess goodwill for possible impairment by performing a qualitative analysis to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. A quantitative assessment is performed if the qualitative assessment results in a more-likely-than-not determination or if a qualitative assessment is not performed. The quantitative assessment considers whether the carrying amount of a reporting unit exceeds its fair value, in which case an impairment charge is recorded to the extent that the reporting unit’s carrying value exceeds its fair value. The Company’s goodwill was generated from the acquisitions during the year ended July 31, 2019. We currently have two reporting units - Hospitality and Early Childhood Education. Given the impact of COVID-19 pandemic and the unfavorable operation results, an interim goodwill impairment assessment is performed as of January 31, 2020. Based on the assessment result, management determined that the goodwill was fully impaired as of January 31, 2020. |
Business Combinations | Business Combinations: |
Noncontrolling interest | Noncontrolling interest: |
Advertising costs | Advertising costs: |
Income Taxes | Income Taxes: On December 22, 2017, the President of the United States signed into law the Tax Reform Act. The Tax Reform Act permanently reduces the U.S. corporate income tax rate from a maximum of 35% to a flat 21% rate, effective January 1, 2018. In addition, the 2017 Tax Act also creates a new requirement that certain income (i.e., Global Intangible Low-Taxed Income (“GILTI”)) earned by controlled foreign corporations (“CFCs”) must be included in the gross income of the CFCs’ U.S. shareholder income. The tax law in PRC applies an income tax rate of 25% to all enterprises. The Company’s subsidiary does not receive any preferential tax treatment from local government. The Company has been in loss position for years and zero balances of tax provisions, deferred tax assets and liabilities as of the reporting periods ended. The tax reforms have no significant impacts on the Company. |
Revenue Recognition | Revenue Recognition: |
Income (Loss) Per Share | Income (Loss) Per Share: |
Recent Accounting pronouncements | Recent Accounting Pronouncements: Recently issued accounting pronouncements not yet adopted In December 2019, the FASB issued Accounting Standards Update (“ASU”) 2019-12, “Simplifying the Accounting for Income Taxes”, as part of its simplification initiative to reduce the cost and complexity in accounting for income taxes. ASU 2019-12 removes certain exceptions related to the approach for intra-period tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. ASU 2019-12 also amends other aspects of the guidance to help simplify and promote consistent application of GAAP. The guidance is effective for fiscal years beginning after December 15, 2020, with early adoption permitted. The Company is currently evaluating the impact of ASU 2019-12 on its financial position, results of operations and liquidity. In August 2018, the FASB issued ASU No. 2018-13, “Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement.” ASU No. 2018-13 removes certain disclosure requirements related to the fair value hierarchy, modifies existing disclosure requirements related to measurement uncertainty and adds new disclosure requirements. ASU No. 2018-13 disclosure requirements include disclosing the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements held at the end of the reporting period and the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. ASU No. 2018-13 is effective for the Company within those fiscal years beginning on December 15, 2019, with early adoption permitted. Certain disclosures in the new guidance will need to be applied on a retrospective basis and others on a prospective basis. The Company does not expect that the adoption of ASU No. 2018-13 will have a material impact on its financial position, results of operations and liquidity. In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments”. The accounting standard changes the methodology for measuring credit losses on financial instruments and the timing when such losses are recorded. ASU No. 2016-13 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2019. Early adoption is permitted for fiscal years, and interim periods within those years, beginning after December 15, 2018. The Company does not expect that the adoption of ASU No. 2016-13 will have a material impact on its financial position, results of operations and liquidity. Recently adopted accounting pronouncements In February 2018, the FASB issued ASU No. 2018-02, “Income Statement - Reporting Comprehensive Income (Topic 220)”, which amends the previous guidance to allow for certain tax effects “stranded” in accumulated other comprehensive income, which are impacted by the Tax Cuts and Jobs Act (the “Tax Reform Act”) , to be reclassified from accumulated other comprehensive income into retained earnings. This amendment pertains only to those items impacted by the new tax law and will not apply to any future tax effects stranded in accumulated other comprehensive income. This standard is effective for fiscal years beginning after December 15, 2018 and allows for early adoption. The adoption of ASU No. 2018-02 did not have an impact on the Company’s financial position, results of operations and liquidity. In January 2017, the FASB issued ASU No. 2017-04, “Intangibles and Other (Topic 350): Simplifying the Test for Goodwill Impairment”, which eliminates the requirement to calculate the implied fair value of goodwill, but rather requires an entity to record an impairment charge based on the excess of a reporting unit’s carrying value over its fair value. This amendment is effective for annual or interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early adoption is permitted. The Company early adopted ASU No. 2017-04 when we tested goodwill impairment as of January 31, 2020. Management determined the goodwill was fully impaired as of January 31, 2020. In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)”. ASU No. 2016-02 requires the recognition of lease assets and lease liabilities on the balance sheet for leases classified as operating leases under previous guidance. The accounting for finance leases (capital leases) was substantially unchanged. The original guidance required application on a modified retrospective basis with adjustments to the earliest comparative period presented. In August 2018, the FASB issued ASU No. 2018-11, “Targeted Improvements to ASC 842,” which included an option to not restate comparative periods in transition and elect to use the effective date of ASU No. 2016-02 as the date of initial application, which the Company elected. As a result, the consolidated balance sheet prior to August 1, 2019 was not restated, and continues to be reported under previous guidance that did not require the recognition of operating lease liabilities and corresponding lease assets on the consolidated balance sheet. The cumulative effect of the changes made to our Condensed Consolidated Balance Sheet at August 1, 2019 for the adoption of the new lease standard was as follows: Balance at Balance at July 31, 2019 Adjustments August 1, 2019 Assets: Prepaid and Other current receivables 386,700 (74,197 ) 312,503 ROU assets-Operating lease — 4,185,827 4,185,827 Liabilities: Current Operating Lease liabilities — 651,424 651,424 Operating lease liabilities — 3,481,229 3,481,229 The adoption of ASU No. 2016-02 had an immaterial impact on the Company’s condensed Consolidated Statement of Operation and condensed Consolidated Statement of Cash Flows for the six months ended January 31, 2020. In addition, the Company elected the package of practical expedients permitted under the transition guidance within the new standard, which allowed the Company to carry forward the historical lease classification, not reassess prior conclusions related to expired or existing contracts that are or that contain leases, and not reassess the accounting for initial direct costs. Operating leases with a term of 12 months or less will not be recorded on the Consolidated Balance Sheet. Additional information and disclosures required by ASU No. 2016-02 are contained in Note 11 Leases. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Jan. 31, 2020 | |
Accounting Policies [Abstract] | |
Schedule of property and equipment estimated lives | The estimated useful lives of property and equipment are as follows: Years Leasehold improvements Lesser of lease term or estimated useful life ROU assets-Finance lease Lease term Furniture and fixtures 3-5 Office equipment and vehicles 3-5 Computer software 3-5 |
Schedule of cumulative effect of changes fianancial statement | The cumulative effect of the changes made to our Condensed Consolidated Balance Sheet at August 1, 2019 for the adoption of the new lease standard was as follows: Balance at Balance at July 31, 2019 Adjustments August 1, 2019 Assets: Prepaid and Other current receivables 386,700 (74,197 ) 312,503 ROU assets-Operating lease — 4,185,827 4,185,827 Liabilities: Current Operating Lease liabilities — 651,424 651,424 Operating lease liabilities — 3,481,229 3,481,229 |
ACQUISITIONS AND JOINT VENTUR_2
ACQUISITIONS AND JOINT VENTURES (Tables) | 6 Months Ended |
Jan. 31, 2020 | |
Business Acquisition, Pro Forma Information | The unaudited pro forma results are as follows: Three months ended January 31, Six months ended January 31, 2020 2019 2020 2019 Revenues $ 25,684 $ 11,197 $ 55,909 $ 40,906 Net Loss (1,458,993 ) (283,436 ) (1,882,506 ) (484,716 ) Less: Net Loss Attributable to Noncontrolling Interest (314,498 ) (23,817 ) (398,017 ) (31,454 ) Net Loss Attributable to Hartford Great Health Corp $ (1,144,495 ) $ (259,619 ) $ (1,484,489 ) $ (453,262 ) Weighted average shares outstanding: Basic and diluted 99,108,000 99,108,000 99,108,000 99,108,000 Net loss per common share: Basic and Diluted (0.01 ) (0.00 ) (0.01 ) (0.00 ) |
HZHF [Member] | |
Schedule of Recognized Identified Assets Acquired | The calculation of purchase price and purchase price allocation is as following: Identifiable Assets Acquired Cash and cash equivalents $ 154 Other current assets 37,964 Property and equipment, net 4,038 Deferred Start-up cost, noncurrent 99,463 Total Consideration $ 141,61 9 |
HZLJ [Member] | |
Schedule of Recognized Identified Assets Acquired | The calculation of purchase price and purchase price allocation is as follows: Assets Acquired and Liabilities Assumed Cash and cash equivalents $ 15,383 Accounts and Other receivables 13,224 Related party receivable 22,861 Property and Equipment, net 247,940 Other assets 699,066 Goodwill 466,847 Accounts payable (2,671 ) Related party payable (1,232,512 ) Other account payable (28,772 ) Other liabilities (336,051 ) Noncontrolling interest 240,613 Total consideration * $ 105,928 *$16,537 payable due from HZLJ waived by HFHZ plus $89,891 (RMB600,000) cash payment totaled $105,928 consideration for the acquisition. |
HFSH [Member] | |
Schedule of Recognized Identified Assets Acquired | he calculation of purchase price and purchase price allocation is as follows: Assets Acquired and Liabilities Assumed Cash and cash equivalents $ 35,886 Accounts and Other receivables 92,120 Property and Equipment, net 6,511 Other assets 791,445 Goodwill 573,170 Accounts payable (3,126 ) Related party payable (1,073,380 ) Noncontrolling interest (63,911 ) Total consideration * $ 358,715 *$223,477 payable due to HFHZ waived plus $135,238 (RMB907,737) cash payment totaled $358,715 consideration for the acquisition. |
RESTRICTED CASH (Tables)
RESTRICTED CASH (Tables) | 6 Months Ended |
Jan. 31, 2020 | |
Cash and Cash Equivalents [Abstract] | |
Reconciliation of cash, cash equivalents and restricted cash | January 31, 2020 January 31, 2019 (unaudited) (unaudited) Cash and cash equivalents $ 50,379 $ 93,371 Restricted cash, noncurrent 28,832 — Total cash, cash equivalents and restricted cash shown in the statement of cash flows $ 79,211 $ 93,371 |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 6 Months Ended |
Jan. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property and equipment, net | Property and equipment, net consists of the following at January 31, 2020 and July 31, 2019: January 31, 2020 (unaudited) July 31, 2019 Leasehold improvements $ 23,190 $ 23,366 Finance lease assets 270,799 272,860 Furniture and fixtures 233,581 235,360 Office equipment and vehicles 76,620 68,859 Construction in progress 200,493 — 804,683 600,445 Less: accumulated depreciation and amortization (352,942 ) (346,861 ) $ 451,741 $ 253,584 |
OTHER ASSETS (Tables)
OTHER ASSETS (Tables) | 6 Months Ended |
Jan. 31, 2020 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Other assets | Other assets consist of the following at January 31, 2020 and July 31, 2019: January 31, 2020 (unaudited) July 31, 2019 Other miscellaneous assets $ 43,307 $ — Deferred cost of finance lease, net 657,734 673,634 $ 701,041 $ 673,634 |
Schedule of future amortization of other assets | The future amortization schedule for the other assets related to the cost of obtaining the finance lease as of January 31, 2020 is as following: 2020 (excluding the six months ended January 31, 2020) $ 10,812 2021 21,624 2022 21,624 2023 21,624 2024 21,624 2025 and thereafter 560,426 Total $ 657,73 4 |
GOODWILL (Tables)
GOODWILL (Tables) | 6 Months Ended |
Jan. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The following is a roll-forward of goodwill for the year ended July 31, 2019 and for the six months ended January 31, 2020: HZHF & HZLJ HFSH and Qiao Garden Int'l Travel Total Balance at July 31, 2018 $ — $ — $ — Acquisitions 466,847 573,170 1,040,017 Impairment — — — Balance at July 31, 2019 $ 466,847 $ 573,170 $ 1,040,017 Acquisitions — — — Impairment (451,732 ) (554,611 ) (1,006,343 ) Foreign Exchange (15,115 ) (18,559 ) (33,674 ) Balance at January 31, 2020 (unaudited) $ — $ — $ — ?char_error? ; |
OTHER CURRENT PAYABLE (Tables)
OTHER CURRENT PAYABLE (Tables) | 6 Months Ended |
Jan. 31, 2020 | |
Payables and Accruals [Abstract] | |
Accounts and other payables | The following is a breakdown of the accounts and other payables as of January 31, 2020 and July 31, 2019: January 31, 2020 (unaudited) July 31, 2019 Payable to Acquiree $ 130,860 $ 131,856 Current Lease Liability-Financing lease 20,903 — Deferred revenue 76,439 — Other payable 117,826 44,000 $ 346,028 $ 175,85 6 |
LEASE (Tables)
LEASE (Tables) | 6 Months Ended |
Jan. 31, 2020 | |
Notes to Financial Statements | |
Lease-related assets and liabilities | Lease-related assets and liabilities at January 31, 2020 and July 31, 2019 were as follows: January 31, July 31, 2020 (unaudited) 2019 Assets Finance lease right-of-use assets, cost $ 270,799 $ 272,860 Less: accumulated amortization (61,645 ) (58,787 ) Finance lease right-of-use assets, net 209,154 214,073 ROU assets-Operating lease 3,815,301 — Total Lease ROU assets $ 4,024,455 $ 214,073 Liabilities Current Operating Lease liabilities $ 790,060 $ — Other current payable-Finance leases 20,903 20,336 Operating lease liabilities, noncurrent 3,013,797 — Finance lease liabilities, noncurrent 305,090 315,710 Total Lease liabilities $ 4,129,850 $ 336,04 6 |
Components of lease cost | The components of lease cost for the three and six months ended January 31, 2020 was as follows: Three months ended Six months ended January 31, 2020 (unaudited) January 31, 2020 (unaudited) Operating lease cost $ 259,589 $ 463,159 Finance leases: Amortization of ROU assets 1,675 3,302 Interest on finance lease liabilities 6,426 12,668 Finance lease cost 8,101 15,970 Total lease cost $ 267,690 $ 479,12 9 |
Supplemental cash flow information for leases | Supplemental cash flow information for leases for the six months ended January 31, 2020 was as follows: Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 327,895 Financing cash flows from finance leases 19,891 |
Schedule of Weighted-average Remaining Lease Term and Weighted-average Discount Rate for Operating and Finance Leases | The weighted-average remaining lease term and weighted-average discount rate for operating and finance leases at January 31, 2020 was as follows: Operating Leases Finance Leases Weighted-average remaining lease term (years) 4.0 32 Weighted-average discount rate 8 % 8 % |
Future minimum lease payments for operating and finance leases | The following table reconciles the undiscounted future minimum lease payments for operating and finance leases executed at January 31, 2020: Operating Leases Finance Leases 2020 (excluding the six-months ended January 31, 2020) $ 474,691 $ — 2021 1,142,081 20,903 2022 1,003,176 21,624 2023 664,306 22,345 2024 583,026 23,066 2025 and thereafter 687,325 938,487 Total lease payments $ 4,554,605 $ 1,026,425 Less interest (750,748 ) (700,432 ) Present value of future lease payments $ 3,803,857 $ 325,993 Current Lease liabilities 790,060 20,903 Noncurrent Lease liabilities 3,013,797 305,090 |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 6 Months Ended |
Jan. 31, 2020 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transactions | January 31, 2020 (unaudited) July 31, 2019 Shanghai Senior Investment Ltd. $ 58,957 $ 106,866 Shanghai Oversea Chinese Culture Media Ltd. 564,885 50,808 Various affiliates 35,313 40,101 $ 659,155 $ 197,775 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 6 Months Ended |
Jan. 31, 2020 | |
Segment Reporting [Abstract] | |
Segment Information | Segment information on assets as of January 31, 2020 and revenue generated during the six months ended January 31, 2020, as follows: Hospitality Education Corporate and unallocated Total Revenue $ 44,386 $ 11,523 $ — $ 55,909 Operating loss (1,368,260 ) (410,199 ) (110,982 ) (1,889,441 ) Operating loss before tax (1,720,904 ) (59,015 ) (101,787 ) (1,881,706 ) Net Loss attributable to Hartford Great Health Corp (1,117,444 ) (264,458 ) (102,587 ) (1,484,489 ) Total assets (excluding Intercompany balances) 1,846,219 3,397,315 1,032,656 6,276,190 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) | 6 Months Ended |
Jan. 31, 2020 | |
Leasehold Improvements [Member] | |
Estimated useful lives of property and equipment | Lesser of lease term or estimated useful life |
ROU assets-Finance lease [Member] | |
Estimated useful lives of property and equipment | Lease term |
Furniture and Fixtures [Member] | Minimum [Member] | |
Property, Plant and Equipment, Useful Life | 3 years |
Furniture and Fixtures [Member] | Maximum [Member] | |
Property, Plant and Equipment, Useful Life | 5 years |
Office equipment and vehicles [Member] | Minimum [Member] | |
Property, Plant and Equipment, Useful Life | 3 years |
Office equipment and vehicles [Member] | Maximum [Member] | |
Property, Plant and Equipment, Useful Life | 5 years |
Computer Software [Member] | Minimum [Member] | |
Property, Plant and Equipment, Useful Life | 3 years |
Computer Software [Member] | Maximum [Member] | |
Property, Plant and Equipment, Useful Life | 5 years |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 1) - USD ($) | Aug. 02, 2019 | Jul. 31, 2019 |
Assets: | ||
Prepaid and Other current receivables | $ 312,503 | $ 386,700 |
ROU assets-Operating lease | 4,185,827 | 0 |
Liabilities: | ||
Current Operating Lease liabilities | 651,424 | 0 |
Operating lease liabilities | $ 3,481,229 | 0 |
Adjustments [Member] | ||
Assets: | ||
Prepaid and Other current receivables | (74,197) | |
ROU assets-Operating lease | 4,185,827 | |
Liabilities: | ||
Current Operating Lease liabilities | 651,424 | |
Operating lease liabilities | $ 3,481,229 |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jan. 31, 2020 | Jan. 31, 2019 | Jan. 31, 2020 | Jan. 31, 2019 | |
Accounting Policies [Abstract] | ||||
FDIC insured amount | $ 250,000 | $ 250,000 | ||
Impairment of goodwill | 0 | |||
Advertising cost | $ 3,154 | $ 0 | $ 9,118 | $ 0 |
U.S. corporate income tax rate | 21.00% | 35.00% | ||
Income tax rate | 25.00% |
GOING CONCERN (Details Narrativ
GOING CONCERN (Details Narrative) - USD ($) | 6 Months Ended | ||
Jan. 31, 2020 | Jan. 31, 2019 | Jul. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Accumulated deficit | $ (2,401,305) | $ (916,816) | |
Net cash used in operating activities | $ 4,755 | $ (80,779) |
STOCKHOLDERS' EQUITY (Details N
STOCKHOLDERS' EQUITY (Details Narrative) - USD ($) | Dec. 11, 2018 | Jan. 31, 2020 | Jan. 31, 2019 | Jul. 31, 2019 |
Stockholders' Equity | ||||
Preferred stock, par value per share | $ 0.001 | $ 0.001 | ||
Preferred stock, shares authorized | 5,000,000 | 5,000,000 | ||
Preferred stock, shares issued | 0 | 0 | ||
Preferred stock, shares outstanding | 0 | 0 | ||
Common stock, par value per share | $ 0.001 | $ 0.001 | ||
Common stock, shares authorized | 300,000,000 | 300,000,000 | ||
Common stock, shares issued | 99,108,000 | 99,108,000 | ||
Common stock, shares outstanding | 99,108,000 | 99,108,000 | ||
Stock issued during the period, Shares | 96,090,000 | |||
Share price | $ 0.02 | |||
Proceeds from issue of common stock | $ 1,921,800 | $ 0 | $ 616,000 |
ACQUISITIONS AND JOINT VENTUR_3
ACQUISITIONS AND JOINT VENTURES (Details) - USD ($) | Jan. 31, 2020 | Jul. 31, 2019 | Jul. 31, 2018 | |
Related party receivable | $ 738,449 | $ 713,612 | ||
Other assets | 657,734 | |||
Goodwill | 0 | 1,040,017 | $ 0 | |
Related party payable | (587,525) | (584,674) | ||
Noncontrolling interest | 487,586 | $ 81,141 | ||
Hangzhou Hartford Comprehensive Health Management | ||||
Cash and cash equivalents | 154 | |||
Other current assets | 37,964 | |||
Property and Equipment, net | 4,038 | |||
Noncontrolling interest | 99,463 | |||
Total consideration | 141,619 | |||
SH Luosheng | ||||
Cash and cash equivalents | 15,383 | |||
Accounts and Other receivables | 13,224 | |||
Related party receivable | 22,861 | |||
Property and Equipment, net | 247,940 | |||
Other assets | 699,066 | |||
Goodwill | 466,847 | |||
Accounts payable | (2,671) | |||
Related party payable | (1,232,512) | |||
Other account payable | (28,772) | |||
Other liabilities | (336,051) | |||
Noncontrolling interest | 240,613 | |||
Total consideration | [1] | 105,928 | ||
Shanghai Hartford Comprehensive Health Management | ||||
Cash and cash equivalents | 35,886 | |||
Accounts and Other receivables | 92,120 | |||
Property and Equipment, net | 6,511 | |||
Other assets | 791,445 | |||
Goodwill | 573,170 | |||
Accounts payable | (3,126) | |||
Related party payable | (1,073,380) | |||
Noncontrolling interest | (63,911) | |||
Total consideration | [2] | $ 358,715 | ||
[1] | $16,537 payable due from HZLJ waived by HFHZ plus $89,891 (RMB600,000) cash payment totaled $105,928 consideration for the acquisition. | |||
[2] | $223,477 payable due to HFHZ waived plus $135,238 (RMB907,737) cash payment totaled $358,715 consideration for the acquisition. |
ACQUISITIONS AND JOINT VENTUR_4
ACQUISITIONS AND JOINT VENTURES (Details 1) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jan. 31, 2020 | Jan. 31, 2019 | Jan. 31, 2020 | Jan. 31, 2019 | |
Notes to Financial Statements | ||||
Revenues | $ 25,684 | $ 11,197 | $ 55,909 | $ 40,906 |
Net Loss | (1,458,993) | (283,436) | (1,882,506) | (484,716) |
Less: Net Loss Attributable to Noncontrolling Interest | (314,498) | (23,817) | (398,017) | (31,454) |
Net Loss Attributable to Hartford Great Health Corp | $ (1,144,495) | $ (259,619) | $ (1,484,489) | $ (453,262) |
Weighted average shares outstanding: | ||||
Basic and Diluted | 99,108,000 | 99,108,000 | 99,108,000 | 99,108,000 |
Net loss per common share: | ||||
Basic and Diluted | $ (0.01) | $ 0 | $ (0.01) | $ 0 |
ACQUISITIONS AND JOINT VENTUR_5
ACQUISITIONS AND JOINT VENTURES (Details Narrative) - USD ($) | 6 Months Ended | |
Jan. 31, 2020 | Jul. 31, 2019 | |
Common Stock | ||
Issuance of common stock, Shares | 96,090,000 | |
Qiao Garden Group | ||
Due to related party | $ 595,939 | |
Shanghai DuBian Assets Management | ||
Advanced from related party | 596,348 | |
Shanghai Qiaohong Real Estate Co | ||
Related party receivable | 677,463 | |
SH Qiaohong | ||
Related party receivable | 688,660 | $ 674,524 |
Advanced from related party | 990,665 | |
Director | ||
Due from related party | 109,355 | |
Hartford International Education Technology | ||
Capital contribution from stockholders | 223,089 | |
Capital injected | $ 497,715 |
RESTRICTED CASH (Details)
RESTRICTED CASH (Details) - USD ($) | Jan. 31, 2020 | Jul. 31, 2019 | Jan. 31, 2019 | Jul. 31, 2018 |
Cash and Cash Equivalents [Abstract] | ||||
Cash and cash equivalents | $ 50,379 | $ 269,672 | $ 93,371 | |
Restricted cash, noncurrent | 28,832 | 29,052 | 0 | |
Total cash, cash equivalents and restricted cash shown in the statement of cash flows | $ 79,211 | $ 298,724 | $ 93,371 | $ 1,444 |
LOAN RECEIVABLES, CURRENT AND_2
LOAN RECEIVABLES, CURRENT AND NONCURRENT (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | |
Jan. 31, 2020 | Jan. 31, 2020 | Jul. 31, 2019 | |
Loan receivables | $ 0 | $ 0 | $ 204,561 |
Longsheng Aquatic Products [Member] | |||
Loan receivables | 99,870 | $ 99,870 | |
Expiration date | May 13, 2020 | ||
Interest rate | 6.00% | ||
Interest income | 1,531 | $ 3,063 | |
Interest receivable accrued | 5,843 | 5,843 | 2,780 |
Hong Kong Hong Tai Intl Trade Limited | |||
Loan receivables | 300,000 | $ 300,000 | |
Expiration date | Jun. 27, 2019 | ||
Interest rate | 6.00% | ||
Interest income | $ 1,923 | ||
Hong Kong Hong Tai Intl Trade [Member] | |||
Loan receivables | 200,000 | $ 200,000 | |
Expiration date | Sep. 3, 2020 | ||
Interest rate | 6.00% | ||
Interest income | 3,067 | $ 6,133 | |
Interest receivable accrued | $ 11,100 | $ 11,100 | $ 4,967 |
PROPERTY AND EQUIPMENT, NET (De
PROPERTY AND EQUIPMENT, NET (Details) - USD ($) | Jan. 31, 2020 | Jul. 31, 2019 |
Finance lease assets | $ 270,799 | $ 272,860 |
Property, plant and equipment - Gross | 804,683 | 600,445 |
Less: accumulated depreciation and amortization | (352,942) | (346,861) |
Property, plant and equipment - net | 451,741 | 253,584 |
Leasehold Improvements [Member] | ||
Property, plant and equipment - Gross | 23,190 | 23,366 |
Furniture and Fixtures [Member] | ||
Property, plant and equipment - Gross | 233,581 | 235,360 |
Office equipment and vehicles [Member] | ||
Property, plant and equipment - Gross | 76,620 | 68,859 |
Construction in Progress [Member] | ||
Property, plant and equipment - Gross | $ 200,493 | $ 0 |
PROPERTY AND EQUIPMENT, NET (_2
PROPERTY AND EQUIPMENT, NET (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jan. 31, 2020 | Jan. 31, 2019 | Jan. 31, 2020 | Jan. 31, 2019 | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation expense | $ 4,311 | $ 84 | $ 8,576 | $ 84 |
OTHER ASSETS (Details)
OTHER ASSETS (Details) - USD ($) | Jan. 31, 2020 | Jul. 31, 2019 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Other miscellaneous assets | $ 43,307 | $ 0 |
Deferred cost of finance lease, net | 657,734 | 673,634 |
Other assets | $ 701,041 | $ 673,634 |
OTHER ASSETS (Details 1)
OTHER ASSETS (Details 1) | Jan. 31, 2020USD ($) |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
2020 (excluding the six months ended January 31, 2020) | $ 10,812 |
2021 | 21,624 |
2022 | 21,624 |
2023 | 21,624 |
2024 | 21,624 |
2025 and thereafter | 560,426 |
Total | $ 657,734 |
OTHER ASSETS (Details Narrative
OTHER ASSETS (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jan. 31, 2020 | Jan. 31, 2019 | Jan. 31, 2020 | Jan. 31, 2019 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||||
Lease term | 41 years | 41 years | ||
Amortization expense | $ 5,369 | $ 0 | $ 10,656 | $ 0 |
GOODWILL (Details)
GOODWILL (Details) - USD ($) | 6 Months Ended | 12 Months Ended |
Jan. 31, 2020 | Jul. 31, 2019 | |
Goodwill at beginning | $ 1,040,017 | $ 0 |
Acquisitions | 0 | 1,040,017 |
Impairment | (1,006,343) | 0 |
Foreign Exchange | (33,674) | |
Goodwill at end | 0 | 1,040,017 |
Hangzhou Longjing Qiao Fu Vacation Hotel | ||
Goodwill at beginning | 466,847 | 0 |
Acquisitions | 0 | 466,847 |
Impairment | (451,732) | 0 |
Foreign Exchange | (15,115) | |
Goodwill at end | 0 | 466,847 |
HFSH and Shanghai Qiao Garden Int'l Travel Agency | ||
Goodwill at beginning | 573,170 | 0 |
Acquisitions | 0 | 573,170 |
Impairment | (554,611) | 0 |
Foreign Exchange | (18,559) | |
Goodwill at end | $ 0 | $ 573,170 |
OTHER CURRENT PAYABLE (Details)
OTHER CURRENT PAYABLE (Details) - USD ($) | Jan. 31, 2020 | Jul. 31, 2019 |
Payables and Accruals [Abstract] | ||
Payable to Acquiree | $ 130,860 | $ 131,856 |
Current Lease Liability-Financing lease | 20,903 | 0 |
Deferred revenue | 76,439 | 0 |
Other payable | 117,826 | 44,000 |
Total Other current payables | $ 346,028 | $ 175,856 |
LEASE (Details)
LEASE (Details) - USD ($) | Jan. 31, 2020 | Jul. 31, 2019 |
Assets | ||
Finance lease right-of-use assets, cost | $ 270,799 | $ 272,860 |
Less: accumulated amortization | (61,645) | (58,787) |
Finance lease right-of-use assets, net | 209,154 | 214,073 |
ROU assets-Operating lease | 3,815,301 | 0 |
Total Lease ROU assets | 4,024,455 | 214,073 |
Liabilities | ||
Current Operating Lease liabilities | 790,060 | 0 |
Other current payable-Finance leases | 20,903 | 20,336 |
Operating lease liabilities, noncurrent | 3,013,797 | 0 |
Finance lease liabilities, noncurrent | 305,090 | 315,710 |
Total Lease Liabilities | $ 4,129,850 | $ 336,046 |
LEASE (Details 1)
LEASE (Details 1) - USD ($) | 3 Months Ended | 6 Months Ended |
Jan. 31, 2020 | Jan. 31, 2020 | |
Notes to Financial Statements | ||
Operating lease cost | $ 259,589 | $ 463,159 |
Finance leases: | ||
Amortization of ROU assets | 1,675 | 3,302 |
Interest on finance lease liabilities | 6,426 | 12,668 |
Finance lease cost | 8,101 | 15,970 |
Total lease cost | $ 267,690 | $ 479,129 |
LEASE (Details 2)
LEASE (Details 2) | 6 Months Ended |
Jan. 31, 2020USD ($) | |
Cash paid for amounts included in the measurement of lease liabilities: | |
Operating cash flows from operating leases | $ 327,895 |
Financing cash flows from finance leases | $ 19,891 |
LEASE (Details 3)
LEASE (Details 3) | Jan. 31, 2020 |
Notes to Financial Statements | |
Operating Lease, Weighted Average Remaining Lease Term (years) | 4 years |
Operating Lease, Weighted Average Discount Rate | 8.00% |
Finance Lease, Weighted Average Remaining Lease Term (years) | 32 years |
Finance Lease, Weighted Average Discount Rate | 8.00% |
LEASE (Details 4)
LEASE (Details 4) - USD ($) | Jan. 31, 2020 | Jul. 31, 2019 |
Notes to Financial Statements | ||
2020 (excluding the six-months ended January 31, 2020) | $ 474,691 | |
2021 | 1,142,081 | |
2022 | 1,003,176 | |
2023 | 664,306 | |
2024 | 583,026 | |
2025 and thereafter | 687,325 | |
Total lease payments | 4,554,605 | |
Less interest | (750,748) | |
Present value of future lease payments | 3,803,857 | |
Current Lease liabilities | (790,060) | $ 0 |
Noncurrent Lease liabilities | 3,013,797 | 0 |
2020 (excluding the six-months ended January 31, 2020) | 0 | |
2021 | 20,903 | |
2022 | 21,624 | |
2023 | 22,345 | |
2024 | 23,066 | |
2025 and thereafter | 938,487 | |
Total lease payments | 1,026,425 | |
Less interest | (700,432) | |
Present value of future lease payments | 325,993 | |
Current Lease liabilities | (20,903) | (20,336) |
Noncurrent Lease liabilities | $ 305,090 | $ 315,710 |
LEASE (Details Narrative)
LEASE (Details Narrative) | Jan. 31, 2020 |
Notes to Financial Statements | |
Lease term | 41 years |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) | Jan. 31, 2020 | Jul. 31, 2019 |
Related party payable | $ 659,155 | $ 197,775 |
Shanghai Senior Investment Ltd | ||
Related party payable | 58,957 | 106,866 |
Shanghai Oversea Chinese Culture Media Ltd | ||
Related party payable | 564,885 | 50,808 |
Various affiliates | ||
Related party payable | $ 35,313 | $ 40,101 |
RELATED PARTY TRANSACTIONS (D_2
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | Dec. 11, 2018 | Sep. 30, 2019 | Jan. 31, 2019 | Jan. 31, 2020 | Jan. 31, 2020 | Jan. 31, 2019 | Jul. 31, 2019 |
Additional paid in capital refunded | $ 0 | $ 1,430 | |||||
Stock issued during the period, Shares | 96,090,000 | ||||||
Related party payable | $ 587,525 | 587,525 | $ 584,674 | ||||
Investor [Member] | |||||||
Amount borrowed | $ 30,000 | ||||||
Chief Financial Officer [Member] | |||||||
Additional paid in capital refunded | $ 1,429 | ||||||
Officers and Directors [Member] | |||||||
Stock issued during the period, Shares | 54,040,000 | ||||||
Investors [Member] | |||||||
Stock issued during the period, Shares | 96,090,000 | ||||||
Stock issued during the period, value | $ 1,080,800 | ||||||
SH Qiaohong | |||||||
Related party receivable | 688,660 | 688,660 | 674,524 | ||||
Related party payable | 678,574 | 678,574 | 526,963 | ||||
Interest income | 9,549 | 18,953 | |||||
Line of Credit Facility, Expiration Date | Sep. 30, 2021 | ||||||
Interest rate | 3.00% | ||||||
SH Qiaohong | RMB | |||||||
Line of credit | $ 9,000,000 | ||||||
Affiliates | |||||||
Related party receivable | 49,789 | 49,789 | 39,088 | ||||
Related party payable | 659,155 | 659,155 | 197,775 | ||||
Qiao Garden Group | |||||||
Related party payable | 598,267 | $ 598,267 | 602,821 | ||||
Shanghai DuBian Assets Management | |||||||
Interest rate | 2.50% | ||||||
Interest expenses | 3,661 | $ 7,267 | |||||
Related party payable | $ 588,099 | $ 588,099 | $ 585,146 | ||||
Expiration date | Apr. 30, 2021 | ||||||
Shanghai Oversea Chinese Culture Media Ltd | |||||||
Line of Credit Facility, Expiration Date | Sep. 30, 2021 | ||||||
Interest rate | 3.00% | ||||||
Shanghai Oversea Chinese Culture Media Ltd | RMB | |||||||
Line of credit | $ 5,000,000 |
SEGMENT INFORMATION (Details)
SEGMENT INFORMATION (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jan. 31, 2020 | Jan. 31, 2019 | Jan. 31, 2020 | Jan. 31, 2019 | Jul. 31, 2019 | |
Revenue | $ 25,684 | $ 0 | $ 55,909 | $ 0 | |
Operating loss | (1,461,164) | (56,060) | (1,889,441) | (59,809) | |
Operating loss before tax | (1,458,193) | (155,187) | (1,881,706) | (158,936) | |
Net Loss attributable to Hartford Great Health Corp | (1,144,495) | $ (155,187) | (1,484,489) | $ (158,936) | |
Total assets (excluding Intercompany balances) | 6,276,190 | 6,276,190 | $ 3,673,887 | ||
Hospitality | |||||
Revenue | 44,386 | ||||
Operating loss | (1,368,260) | ||||
Operating loss before tax | (1,720,904) | ||||
Net Loss attributable to Hartford Great Health Corp | (1,117,444) | ||||
Total assets (excluding Intercompany balances) | 1,846,219 | 1,846,219 | |||
Education | |||||
Revenue | 11,523 | ||||
Operating loss | (410,199) | ||||
Operating loss before tax | (59,015) | ||||
Net Loss attributable to Hartford Great Health Corp | (264,458) | ||||
Total assets (excluding Intercompany balances) | 3,397,315 | 3,397,315 | |||
Corporate and unallocated | |||||
Revenue | 0 | ||||
Operating loss | (110,982) | ||||
Operating loss before tax | (101,787) | ||||
Net Loss attributable to Hartford Great Health Corp | (102,587) | ||||
Total assets (excluding Intercompany balances) | $ 1,032,656 | $ 1,032,656 |
SEGMENT INFORMATION (Details Na
SEGMENT INFORMATION (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jan. 31, 2020 | Jan. 31, 2019 | Jan. 31, 2020 | Jan. 31, 2019 | Jul. 31, 2019 | |
Total assets | $ 6,276,190 | $ 6,276,190 | $ 3,673,887 | ||
Revenue | $ 25,684 | $ 0 | 55,909 | $ 0 | |
Subsidiaries [Member] | |||||
Total assets | $ 2,547,989 | ||||
Revenue | $ 56,174 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) | 1 Months Ended |
Apr. 30, 2020USD ($) | |
Subsequent Event [Member] | |
Over-charged rent expense | $ 260,000 |