Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2020shares | |
Cover [Abstract] | |
Entity Registrant Name | Taoping Inc. |
Entity Central Index Key | 0001552670 |
Document Type | 20-F |
Document Period End Date | Dec. 31, 2020 |
Amendment Flag | false |
Current Fiscal Year End Date | --12-31 |
Entity Well Known Seasoned Issuer | No |
Entity Voluntary Filers | No |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Filer Category | Non-accelerated Filer |
Entity Emerging Growth Company | false |
Entity Shell Company | false |
Entity Common Stock, Shares Outstanding | 8,486,956 |
Document Fiscal Period Focus | FY |
Document Fiscal Year Focus | 2020 |
Document Annual Report | true |
Document Transition Report | false |
Document Shell Company | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 | |
CURRENT ASSETS | |||
Cash and cash equivalents | $ 882,770 | $ 1,519,666 | |
Restricted cash | 214,144 | ||
Accounts receivable, net | 4,264,257 | 4,926,081 | |
Accounts receivable-related parties, net | 2,919,215 | 8,733,263 | |
Advances to suppliers | 3,202,313 | 1,064,901 | |
Inventories, net | 254,678 | 302,938 | |
Loan receivable - related party | 519,331 | 397,041 | |
Other current assets | 173,026 | 2,087,946 | |
TOTAL CURRENT ASSETS | 12,429,734 | 19,031,836 | |
Non-current accounts receivable, net | 1,839,230 | 1,648,109 | |
Non-current accounts receivable-related parties, net | 1,323,196 | 3,793,949 | |
Property, equipment and software, net | 10,851,899 | 11,835,516 | |
Intangible assets, net | 1,496 | ||
Long-term investments | 30,592 | ||
Other assets, non-current net | 4,302,000 | 4,304,640 | |
TOTAL ASSETS | 30,776,651 | 40,615,546 | |
CURRENT LIABILITIES | |||
Short-term bank loans | 6,210,176 | 6,584,664 | |
Accounts payable | 14,857,436 | 12,586,696 | |
Accounts payable-related parties | 69,585 | 65,276 | |
Advances from customers | 315,924 | 421,700 | |
Advances from customers-related parties | 161,063 | 140,938 | |
Amounts due to related parties | 137,664 | 129,139 | |
Accrued payroll and benefits | 231,598 | 193,912 | |
Other payables and accrued expenses | 6,636,097 | 4,897,672 | |
Income tax payable | 70,653 | ||
Convertible note payable, net of debt discounts | 1,180,908 | 916,511 | |
TOTAL CURRENT LIABILITIES | 29,800,451 | 26,007,161 | |
Commitments and Contingencies | |||
EQUITY | |||
Ordinary shares, 2020 and 2019: par $0; authorized capital 100,000,000 shares; shares issued and outstanding, 2020: 8,486,956 shares; 2019: 7,000,027 shares*; | [1] | 131,247,787 | 126,257,156 |
Additional paid-in capital | 15,643,404 | 16,461,333 | |
Reserve | 14,044,269 | 14,044,269 | |
Accumulated deficit | (192,212,544) | (174,517,769) | |
Accumulated other comprehensive income | 23,612,413 | 23,022,845 | |
Total equity of the Company | (7,664,671) | 5,267,834 | |
Non-controlling interest | 8,640,871 | 9,340,551 | |
TOTAL EQUITY | 976,200 | 14,608,385 | |
TOTAL LIABILITIES AND EQUITY | $ 30,776,651 | $ 40,615,546 | |
[1] | On July 30, 2020, the Company implemented a one-for-six reverse stock split of the Company's issued and outstanding ordinary shares. Except shares authorized, all references to number of shares, and to per share information in the consolidated financial statements have been retroactively adjusted. |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Ordinary shares, no par value | $ 0 | $ 0 |
Ordinary shares, shares authorized | 100,000,000 | 100,000,000 |
Ordinary shares, shares issued | 8,486,956 | 7,000,027 |
Ordinary shares, shares outstanding | 8,486,956 | 7,000,027 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | ||
TOTAL REVENUE | [1] | $ 11,062,775 | $ 13,791,303 | $ 20,578,340 |
TOTAL COST | 7,119,125 | 7,189,092 | 10,924,246 | |
GROSS PROFIT | 3,943,650 | 6,602,211 | 9,654,094 | |
Administrative expenses | 16,707,106 | 6,657,972 | 4,299,820 | |
Research and development expenses | 3,889,126 | 3,592,843 | 4,756,088 | |
Selling expenses | 714,147 | 523,557 | 429,362 | |
(LOSS) INCOME FROM OPERATIONS | (17,366,729) | (4,172,161) | 168,824 | |
Subsidy income | 556,186 | 431,555 | 556,187 | |
Other (loss) income, net | (578,766) | 238,200 | 400,566 | |
Interest income | 4,798 | 133,517 | 36,381 | |
Interest expense and debt discounts expense | (1,018,013) | (499,852) | (484,403) | |
(Loss) income before income taxes | (18,402,524) | (3,868,741) | 677,555 | |
Income tax benefit | 71,316 | 274,480 | 1,201,231 | |
NET (LOSS) INCOME | (18,331,208) | (3,594,261) | 1,878,786 | |
Less: net loss (income) attributable to the non-controlling interest | 636,433 | 11,929 | (186,803) | |
NET (LOSS) INCOME ATTRIBUTABLE TO THE COMPANY | $ (17,694,775) | $ (3,582,332) | $ 1,691,983 | |
(Loss) earnings per share - Basic and Diluted | ||||
Basic | [2] | $ (2.49) | $ (0.54) | $ 0.24 |
Diluted | [2] | (2.49) | (0.54) | 0.24 |
(LOSS) EARNINGS PER SHARE ATTRIBUTABLE TO THE COMPANY | ||||
Basic | (2.40) | (0.54) | 0.24 | |
Diluted | $ (2.40) | $ (0.54) | $ 0.24 | |
Products [Member] | ||||
TOTAL REVENUE | $ 6,591,132 | $ 3,116,145 | $ 6,546,016 | |
TOTAL COST | 6,211,647 | 6,448,965 | 9,808,837 | |
Products - Related Parties [Member] | ||||
TOTAL REVENUE | 375,736 | 7,352,236 | 9,373,272 | |
Software [Member] | ||||
TOTAL REVENUE | 3,080,152 | 2,246,497 | 3,037,912 | |
TOTAL COST | 572,054 | 525,473 | 783,702 | |
Software - Related Parties [Member] | ||||
TOTAL REVENUE | 45,400 | |||
System Integration [Member] | ||||
TOTAL COST | 57,911 | 227,677 | ||
Others [Member] | ||||
TOTAL REVENUE | 869,635 | 969,751 | 1,490,324 | |
TOTAL COST | 335,424 | 156,743 | 104,030 | |
Others - Related Parties [Member] | ||||
TOTAL REVENUE | $ 146,120 | $ 106,674 | $ 85,416 | |
[1] | Revenues by operating segments exclude intercompany transactions. | |||
[2] | On July 30, 2020, the Company implemented a one-for-six reverse stock split of the Company's issued and outstanding ordinary shares. Except shares authorized, all references to number of shares, and to per share information in the consolidated financial statements have been retroactively adjusted. |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Statement of Comprehensive Income [Abstract] | |||
Net (loss) income | $ (18,331,208) | $ (3,594,261) | $ 1,878,786 |
Other comprehensive (loss) income: | |||
Foreign currency translation gain (loss) | 526,321 | (189,873) | (957,379) |
Comprehensive (loss) income | (17,804,887) | (3,784,134) | 921,407 |
Comprehensive loss (income) attributable to the non- controlling interest | 699,680 | 6,485 | (213,031) |
Comprehensive (loss) income attributable to the Company | $ (17,105,207) | $ (3,777,649) | $ 708,376 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Equity - USD ($) | Ordinary Shares [Member] | Additional Paid-in Capital [Member] | Reserve [Member] | Accumulated Deficit [Member] | Accumulated Other Comprehensive Income [Member] | Noncontrolling Interest [Member] | Total | ||
Balance at Dec. 31, 2017 | $ 123,950,544 | [1] | $ 15,814,328 | $ 13,812,095 | $ (172,395,246) | $ 24,201,766 | $ 9,134,005 | $ 14,517,492 | |
Balance, shares at Dec. 31, 2017 | [1] | 6,705,193 | |||||||
Stock-based payment for consulting fee (Note 16) | [1] | 33,899 | 33,899 | ||||||
Stock-based payment for consulting fee (Note 16), shares | [1] | ||||||||
Exercise of the stock options for consulting services (Note 16) | $ 70,268 | [1] | (23,768) | 46,500 | |||||
Exercise of the stock options for consulting services (Note 16), shares | [1] | 8,333 | |||||||
Issued common stock as a result of exercising stock options by employees (Note 16) | $ 626,184 | [1] | (626,184) | ||||||
Issued common stock as a result of exercising stock options by employees (Note 16), shares | [1] | 79,834 | |||||||
Issued common stock in connection with the private placement (Note 16) | $ 1,500,000 | [1] | 1,500,000 | ||||||
Issued common stock in connection with the private placement (Note 16), shares | [1] | 166,667 | |||||||
Allocation to reserve | [1] | 232,174 | (232,174) | ||||||
Net (loss) income for the year | [1] | 1,691,983 | 186,803 | 1,878,786 | |||||
Foreign currency translation (loss) gain | [1] | (983,607) | 26,228 | (957,379) | |||||
Employee Stock Incentive | [1] | 584,629 | 584,629 | ||||||
Employee Stock Incentive, shares | [1] | ||||||||
Balance at Dec. 31, 2018 | $ 126,146,996 | [1] | 15,782,904 | 14,044,269 | (170,935,437) | 23,218,159 | 9,347,036 | 17,603,927 | |
Balance, shares at Dec. 31, 2018 | [1] | 6,960,027 | |||||||
Shares issued for service | $ 110,160 | 110,160 | |||||||
Shares issued for service, shares | 40,000 | ||||||||
Detachable warrant and beneficial conversion feature in connection with Convertible note (Note 13) | [1] | 113,526 | 113,526 | ||||||
Non-employee Stock options and warrants issued for service | [1] | 59,462 | 59,462 | ||||||
Issuance of detachable warrant along with convertible note (Note 13) | [1] | 11,126 | 11,126 | ||||||
Net (loss) income for the year | [1] | (3,582,332) | (11,929) | (3,594,261) | |||||
Foreign currency translation (loss) gain | [1] | (195,314) | 5,444 | (189,873) | |||||
Employee Stock Incentive | [1] | 494,315 | 494,315 | ||||||
Employee Stock Incentive, shares | [1] | ||||||||
Balance at Dec. 31, 2019 | $ 126,257,156 | [1] | 16,461,333 | 14,044,269 | (174,517,769) | 23,022,845 | 9,340,551 | 14,608,385 | |
Balance, shares at Dec. 31, 2019 | [1] | 7,000,027 | |||||||
Stock-based payment for consulting fee (Note 16) | $ 327,674 | [1] | 84,586 | 412,260 | |||||
Stock-based payment for consulting fee (Note 16), shares | [1] | 104,887 | |||||||
Exercise of non-employee warrants | $ 74,539 | [1] | (74,539) | ||||||
Exercise of non-employee warrants, shares | [1] | 18,144 | |||||||
Exercise of Employee Stock Options (Note 16) | $ 1,305,577 | [1] | (1,305,577) | ||||||
Exercise of Employee Stock Options (Note 16), shares | [1] | 72,414 | |||||||
Conversion of convertible notes (Note 16) | $ 2,065,693 | [1] | (217,360) | 1,848,333 | |||||
Conversion of convertible notes (Note 16), shares | [1] | 767,527 | |||||||
Insurance of common stock for financing (Note 16) | $ 1,151,738 | [1] | 1,151,738 | ||||||
Insurance of common stock for financing (Note 16), shares | [1] | 507,936 | |||||||
Detachable warrant and beneficial conversion feature in connection with Convertible note (Note 13) | [1] | 462,280 | 462,280 | ||||||
Net (loss) income for the year | [1] | (17,694,775) | (636,433) | (18,331,208) | |||||
Round-up of fractional shares in connection with 6:1 reverse stock split | 2,911 | [1] | |||||||
Foreign currency translation (loss) gain | [1] | 589,568 | (63,247) | 526,321 | |||||
Employee Stock Incentive | $ 65,410 | [1] | 232,681 | 298,091 | |||||
Employee Stock Incentive, shares | [1] | 13,110 | |||||||
Balance at Dec. 31, 2020 | $ 131,247,787 | [1] | $ 15,643,404 | $ 14,044,269 | $ (192,212,544) | $ 23,612,413 | $ 8,640,871 | $ 976,200 | |
Balance, shares at Dec. 31, 2020 | [1] | 8,486,956 | |||||||
[1] | On July 30, 2020, the Company implemented a one-for-six reverse stock split of the Company's issued and outstanding ordinary shares. Except shares authorized, all references to number of shares, and to per share information in the consolidated financial statements have been retroactively adjusted. |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | ||
OPERATING ACTIVITIES | ||||
Net (loss) income | $ (18,331,208) | $ (3,594,261) | $ 1,878,786 | |
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities: | ||||
Provision for losses on accounts receivable and other current assets | 13,521,182 | 3,628,544 | 830,266 | |
Provision for obsolete inventories | 5,629 | 115,191 | 30,403 | |
Depreciation | 3,206,568 | 2,842,787 | 2,940,387 | |
Amortization of intangible assets and other asset | 273,076 | 58,164 | 734,150 | |
Amortization of convertible note discount | 558,690 | 46,165 | ||
Loss on sale of property and equipment | 435,767 | 4,243 | ||
Loss from disposal of inventories | 128,983 | 62,732 | 189,861 | |
Stock-based payments for consulting services | 445,749 | 86,326 | 43,788 | |
Stock-based compensation | 298,091 | 494,316 | 584,629 | |
Gain from write-off of long aged payables | (278,099) | |||
Impairment of long-term investments | 45,400 | |||
Changes in operating assets and liabilities: | ||||
Accounts receivable | (3,033,406) | 923,873 | (5,156,120) | |
Accounts receivable from related parties | (292,230) | (5,262,357) | (5,137,222) | |
Inventories | 59,002 | 207,233 | (320,267) | |
Other non-current assets | (4,343,311) | |||
Other receivables and prepaid expenses | 2,054,954 | 4,385,133 | 2,497,105 | |
Advances to suppliers | (2,643,860) | (598,082) | 1,123,765 | |
Amounts due to/from related party | (870,859) | (118,771) | ||
Other payables and accrued expenses | 691,846 | 663,584 | 652,149 | |
Advances from customers | (126,515) | 122,720 | 38,951 | |
Advances from customers from related parties | 10,247 | 91,233 | (939,957) | |
Accounts payable | 1,025,912 | (503,267) | 3,963,341 | |
Accounts payable from related party | 68,845 | |||
Income tax payable | (71,316) | (237,968) | (1,201,831) | |
Net cash (used in) provided by operating activities | (1,782,839) | (1,682,104) | 2,473,802 | |
INVESTING ACTIVITIES | ||||
Proceeds from sale of property and equipment | 25,697 | 133 | 577 | |
Purchases of property, equipment and software | (1,668,363) | (1,619,325) | (1,797,510) | |
Disbursement of loan receivable - related party | (90,977) | (400,608) | ||
Disbursement of loan receivable | (2,270,006) | |||
Proceeds from loan receivable | 2,171,655 | |||
Net cash (used in) provided by investing activities | (1,733,643) | 151,855 | (4,066,939) | |
FINANCING ACTIVITIES | ||||
Proceeds from borrowings under short-term loans | 6,285,837 | 7,817,959 | 6,810,017 | |
Repayment of short-term loans | (7,052,014) | (7,231,612) | (8,178,074) | |
Proceeds from exercise of consultants' stock options | 44,843 | |||
Proceeds from issuance of convertible note, net of debt issuance costs | 2,687,387 | 1,000,000 | ||
Proceeds from issuance of ordinary shares in connection with private placement net of offering costs | 1,151,738 | 1,500,000 | ||
Net cash provided by financing activities | 3,072,948 | 1,586,347 | 176,786 | |
Effect of exchange rate changes on cash and cash equivalents and restricted cash | 20,782 | (189,692) | (191,197) | |
NET DECREASE IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | (422,752) | (133,594) | (1,607,548) | |
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING | 1,519,666 | 1,653,260 | 3,260,808 | |
CASH AND CASH EQUIVALENTS, AND RESTRICTED CASH, ENDING | 1,096,914 | 1,519,666 | 1,653,260 | |
Cash paid during the year | ||||
Income taxes | 600 | |||
Interest | 357,092 | 445,582 | 484,403 | |
Reconciliation to amounts on consolidated balance sheets | ||||
Cash and cash equivalents | 882,770 | 1,519,666 | ||
Restricted cash | 214,144 | |||
Total cash, cash equivalents, and restricted cash | 1,096,914 | 1,519,666 | ||
Supplemental disclosure of significant non-cash transactions: | ||||
Issuance of 79,834 ordinary shares as a result of cashless exercise of stock options | [1] | 626,000 | ||
Purchase of software | [1] | 1,600,000 | 1,500,000 | |
Issuance 40,000 ordinary shares as compensation of a consultant's service | [1] | 110,000 | ||
Issuance an individual investor warrant to purchase 26,667 shares of the Company's ordinary share in connection with the issuance of a convertible promissory note. | [1] | 1,040,000 | ||
Issuance warrant to purchase 25,000 shares of the Company's ordinary shares as compensation of a consultant's service. | [1] | $ 58,000 | ||
Issuance of aggregate restrict and non-restricted ordinary shares warrants | [1] | 300,000 | ||
Issuance of two individual investors warrants with fair value of $11,580 for each to purchase 26,667 shares of the Company's ordinary share in connection with the issuance of convertible promissory note | [1] | $ 1,480,000 | ||
[1] | On July 30, 2020, the Company implemented a one-for-six reverse stock split of the Company's issued and outstanding ordinary shares. Except shares authorized, all references to number of shares, and to per share information in the consolidated financial statements have been retroactively adjusted. |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Parenthetical) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||
Dec. 31, 2020 | Sep. 30, 2020 | Mar. 31, 2020 | Feb. 28, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Jul. 31, 2020 | |
Restricted ordinary shares | 32,887 | ||||||
Non restricted ordinary shares | 72,000 | ||||||
Warrants issued as compensation | 16,667 | ||||||
Issuance of convertible promissory note | $ 1,848,333 | ||||||
Consultants [Member] | |||||||
Number of ordinary shares issued | 40,000 | ||||||
Warrants to purchase common stock | 25,000 | ||||||
Consultants [Member] | Two Individual investors [Member] | |||||||
Issuance of convertible promissory note | $ 11,580 | ||||||
Issuance of convertible promissory note, shares | 26,667 | ||||||
Individual Investor [Member] | |||||||
Number of ordinary shares issued | 285,714 | ||||||
Warrants to purchase common stock | 26,667 | ||||||
Issuance of convertible promissory note | $ 18,040 | ||||||
Issuance of convertible promissory note, shares | 53,333 | ||||||
Holders [Member] | Convertible Promissory Note [Member] | |||||||
Debt instrument principal amount | $ 1,089,833 | ||||||
Debt instrument price per share | $ 2.40 | ||||||
Number of shares issued for debt connversion | 454,097 | ||||||
Each of Two Holders [Member] | Convertible Promissory Note [Member] | |||||||
Debt instrument principal amount | $ 383,875 | $ 379,250 | |||||
Debt instrument price per share | $ 2.565 | $ 2.42 | $ 2.565 | ||||
Number of shares issued for debt connversion | 149,659 | 156,715 | |||||
Other payable | $ 767,750 | $ 767,750 | |||||
Two Holders [Member] | Convertible Promissory Note [Member] | Subsequent Event [Member] | |||||||
Number of shares issued for debt connversion | 299,318 | ||||||
2016 Equity Incentive Plan [Member] | Consultants [Member] | |||||||
Options granted | 57,366 | ||||||
2016 Equity Incentive Plan [Member] | Directors and Employees [Member] | |||||||
Options granted | 333,348 | ||||||
2016 Equity Incentive Plan [Member] | Employee [Member] | |||||||
Options granted | 13,110 | 13,110 |
Organization, Principal Activit
Organization, Principal Activities and Management's Plans | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization, Principal Activities and Management's Plans | 1. ORGANIZATION, PRINCIPAL ACTIVITIES AND MANAGEMENT’S PLANS Taoping Inc. (f/k/a China Information Technology, Inc.), together with its subsidiaries (the “Company” or “TAOP”), is a leading provider of cloud-app technologies for Smart City IoT platforms, digital advertising delivery, and other internet-based information distribution systems in China. Our Internet ecosystem enables all participants of the new media community to efficiently promote branding, disseminate information, and exchange resources. In addition, we provide a broad portfolio of software, hardware with fully integrated solutions, including information technology infrastructure, Internet-enabled display technologies, and IoT platforms to customers in government, education, residential community management, media, transportation, and other private sectors. In May 2018, we changed our corporate name from “China Information Technology Inc.” to “Taoping Inc.”, to more accurately reflect our current business operations in the new media and IoT industries. As listed in the table below, these services are provided through the Company’s wholly-owned People’s Republic of China (PRC) subsidiaries, Information Security Technology International Co., Ltd. (“IST”), TopCloud Software Co., Ltd., (“TopCloud”), and Information Security IoT Tech. Co., Ltd. (“ISIOT ), and through the Company’s variable interest entities (“VIE”), iASPEC Technology Group Co., Ltd. (“iASPEC”) and its subsidiaries, iASPEC Bocom IoT Technology Co. Ltd. (“Bocom”), and Shenzhen Biznest Internet Tech. Co., Ltd. (“Biznest”), and the Company’s wholly-owned Hong Kong subsidiary Information Security Tech. International Co. Ltd. (“IST HK”). December 31, December 31, December 31, Subsidiaries/ 2020 2019 2018 Entities VIE % owned % owned % owned Location Taoping Inc. British Virgin Islands Taoping Holdings Limited (THL) Subsidiary 100 % 100 % 100 % British Virgin Islands Information Security Tech. International Co., Ltd. (IST HK) Subsidiary 100 % 100 % 100 % Hong Kong, China Information Security Tech. (China) Co., Ltd. (IST) Subsidiary 100 % 100 % 100 % Shenzhen, China TopCloud Software (China) Co., Ltd. (TopCloud) Subsidiary 100 % 100 % 100 % Shenzhen, China Information Security IoT Tech. Co., Ltd. (ISIOT) Subsidiary 100 % 100 % 100 % Shenzhen, China iASPEC Technology Group Co., Ltd. (iASPEC) VIE 100 % 100 % 100 % Shenzhen, China Biznest Internet Tech. Co., Ltd. (Biznest) VIE 100 % 100 % 100 % Shenzhen, China iASPEC Bocom IoT Tech. Co., Ltd. (Bocom) VIE 100 % 100 % 100 % Shenzhen, China Management Service Agreement iASPEC is a VIE of the Company. To comply with PRC laws and regulations that restrict foreign ownership of companies that provide public security information technology and Geographic Information Systems software operating services to certain government and other customers, the Company operates the restricted aspect of its business through iASPEC. Pursuant to the terms of a management service agreement by and among IST, iASPEC and its shareholders, dated July 1, 2007 (“MSA”), iASPEC granted IST a ten-year, exclusive, royalty-free, transferable worldwide license to use and install certain iASPEC software, along with copies of source and object codes relating to such software. In addition, IST licensed back to iASPEC a royalty-free, limited, non-exclusive license to the software, without right of sub-license, for the sole purpose of permitting iASPEC to carry out its business as presently conducted. IST has the right to designate two Chinese citizens to serve as senior managers of iASPEC, to serve as a majority on iASPEC’s Board of Directors, and to assist managing the business and operations of iASPEC. In addition, both iASPEC and IST will require the affirmative vote of a majority of the Company’s Board of Directors, including at least one non-insider director, for certain material actions, as defined, with respect to iASPEC. Option Agreement In connection with the MSA, on July 1, 2007, IST also entered into an immediately exercisable purchase option agreement (the “Option Agreement”) with iASPEC and its shareholders. Pursuant to the Option Agreement, the iASPEC shareholder granted IST or its designee(s) an exclusive, irrevocable option to purchase, from time to time, all or a part of iASPEC’s shares or iASPEC’s assets from the iASPEC shareholder for $1,800,000 in aggregate. The option may not be exercised if the exercise would violate any applicable laws and regulations in PRC or cause any license or permit held by, and necessary for the operation of iASPEC, to be cancelled or invalidated. The Option Agreement will terminate on the date that IST exercises its purchase option and acquires all the shares or assets of iASPEC pursuant to the terms of the Option Agreement. The Option Agreement may be rescinded by IST upon 30 days’ notice without costs to terminate. The Option Agreement does not have renewal provisions. Amended and Restated MSA The Amended and Restated MSA was entered into on December 13, 2009, by and among IST, iASPEC and iASPEC’s sole shareholder, Mr. Jianghuai Lin (“Mr. Lin”). Pursuant to the Amended and Restated MSA, IST will provide management and consulting services to iASPEC, under the following terms: ● iASPEC agreed that IST will be entitled to receive ninety five percent (95%) of the Net Received Profit, as defined, of iASPEC during the term of the Agreement. iASPEC is obligated to calculate and pay the Net Received Profit due to IST no later than the last day of the first month following the end of each fiscal quarter. Mr. Lin, agreed to enter into an agreement with IST to pledge all of his equity interests in iASPEC as security for his and iASPEC’s fulfillment of their respective obligations under the MSA, and to register the pledge agreement with the local AIC (Administration for Industry and Commerce). The Amended and Restated MSA was executed on December 13, 2009. Based on the advice of the Company’s PRC legal counsel, in January 2010 all the parties to the agreement decided not to enter into a pledge agreement. ● Mr. Lin confirmed his status as the sole iASPEC shareholder and his assumption of all of the obligations of the iASPEC shareholder under the agreement, including a confirmation of his continuing obligation under a written guaranty, executed by the then iASPEC shareholders. ● Based on iASPEC’s needs for its development and operation, IST has the right, from time to time, at its sole discretion, to provide iASPEC with capital support. ● IST agreed that it will not interfere with any business of iASPEC covered by iASPEC’s PRC State Secret related Computer Information System Integration Certificate, including but not limited to, seeking access to relevant documents regarding such business. However, iASPEC agreed that it will cooperate with the requests of the Company as necessary to comply with the Company’s reporting obligations to the Securities and Exchange Commission. (“SEC”). The Amended and Restated MSA amended certain terms of the original Management Service Agreement which became effective on July 1, 2007 and has a term of 30 years unless otherwise early termination by the parties by one of the following means: ● Either iASPEC or IST may terminate the Amended and Restated MSA immediately (a) upon the material breach by a party of its obligations and the failure of such party to cure such breach within 30 working days after written notice from the non-breaching party; or (b) upon the filing of a voluntary or involuntary petition in bankruptcy by a party, or of which the party is the subject to insolvency, or the commencement of any proceedings placing the party in a receivership, or of any assignment by a party for the benefit of creditors; or ● The Amended and Restated MSA may be terminated at any time by IST upon 90 calendar days’ written notice delivered to all other parties. Upon any effective date of any termination of the Amended and Restated MSA: (a) IST will cease providing management services to iASPEC; (ii) IST will deliver to iASPEC all chops and seals of iASPEC; (iii) IST will deliver to iASPEC all of the financial and other books and records of iASPEC, including any and all permits, licenses, certificates and other proprietary and operational documents and instruments; (iv) the senior managers who are recommended by IST and elected as directors of iASPEC will resign from the Board of Directors of iASPEC in a lawful way; and (v) the software license that iASPEC granted to IST according to the Amended and Restated MSA will terminate unless otherwise agreed by the parties. In addition, any amounts owing from any party to any other party on the effective date of any termination under the terms of the Amended and Restated MSA will continue to be due and owing despite such termination. The Amended and Restated MSA does not have renewal provisions. We expect that the parties to the Amended and Restated MSA will negotiate to extend the term of the agreement before its expiration. The substance of the Amended and Restated MSA and the Option Agreement is to: ● Allow the Company to utilize the business licenses, contacts, permits, and other resources of iASPEC in order for the Company to be able to expand its operations and business model; ● Provide the Company with effective control over all of iASPEC’s operations; and provide the shareholders of iASPEC an opportunity to monetize a portion of their investment through the $1.8 million purchase option. Going Concern and Management’s Plans In the first 6 months of 2020, various levels of city lock-downs resulted in confining individual’s mobility, ceasing private and public transportations, halting vast majority of business transactions, depleting businesses’ cash flows due to outbreak of the COVID-19 pandemic. As a result of negative impact to overall economy and businesses from the COVID-19 pandemic, the Company was unable to deliver products and services and collect outstanding trade accounts receivable causing significant decline in revenue and increase in allowance for credit losses. Due to the unfavorable macro environment and the slowdown of the out-of-home advertising industry in China, the Company suffered a net loss of approximately $18.3 million for the year ended December 31, 2020, compared to a net loss of approximately $3.6 million for the year ended December 31, 2019. The Company reported cash outflows from operations of approximately $1.8 million for the year ended December 31, 2020, compared to cash outflows from operations of $1.7 million for the year ended December 31, 2019. As of December 31, 2020, the Company had a working capital deficit of approximately $17.4 million, compared to a working capital deficit of approximately $7.0 million as of December 31 2019. The Company had significant accumulated deficit approximately $192.2 million and $174.5 million as of December 31, 2020 and 2019, respectively. In March 2020, the Company completed a financing transaction comprising of ordinary shares, convertible notes, and warrants with aggregate proceeds net of issuance cost and debt discount of $1.9 million. In September 2020, the Company consummated a financing transaction comprising of ordinary shares, convertible notes, and warrants with aggregate proceeds net of issuance cost and debt discount of $1.9 million. Both financing activities were to increase the Company’s working capital. In July and September 2020, the Company also successfully secured three one-year short term bank loans totaling approximately $2.0 million to further better liquidly. In the first quarter of 2021, the Company consummated a series of financing transactions for new issuance of ordinary shares, with net proceeds of approximately $13.1 million to enrich the Company’s working capital. In 2018, the Company completed transformation of its business model from providing IT software, hardware, and system integration services to the public sectors to offering cloud-based ecosystem solutions to the private sectors. In 2020, the management continued to execute the existing business strategies with focuses on selection of quality customers, collection of accounts receivable, maintaining proper inventory level, and managing accounts payable to enhance operating cash flows. In addition, the Company will aggressively develop domestic and international markets to attract new customers. The Company has also advanced into international area by forming a joint venture in Singapore, establishing a business relationship in Canada, and exploring opportunities in other geographical regions. Starting from the first quarter of 2021, the Company has also sought to explore more market opportunities with the acquisition of 100% shares of Taoping New Media Co., Ltd. and 51% stake of Render Lake Tech Limited. Taoping New Media is a leading media operator in China’s out-of-home digital advertising industry. It has built up its digital advertising network based on TAOP’s cloud platform. Mr. Jianghuai Lin, the Chairman and CEO of TAOP, currently owns approximately 51% of Taoping New Media. Render Lake is a company that provides comprehensive cloud solutions and develops cloud desktop, cloud rendering, cloud computing, NFT (Non-Fungible Token), and cloud gaming businesses. The Company is to issue new ordinary common shares to pay for these two acquisitions. The acquisitions of Taoping New Media Co., Ltd and Render Lake Tech Limited are expected to close in mid-year of 2021. In addition, management believes that the Company has the ability, if needed, to obtain additional credit lines from local banks to provide for capital needs for market expansions by using the title of its office facility as collateral. Management believes that the Company’s current cash and cash equivalents, anticipated cash flows from operations will sustain our operations and business expansion. If the Company’s business strategies are not successful in addressing its current financial concerns, additional capital raise from issuing equity security or debt instrument or additional loan facility may occur to support required cash flows. However, the Company can make no assurances that financing will be available for the amounts we need, or on terms commercially acceptable to us, if at all. If one or all of these events do not occur or subsequent capital raise was insufficient to bridge financial and liquidity shortfall, substantial doubt exists about the Company’s ability to continue as a going concern. The consolidated financial statements have been prepared assuming that the Company will continue as a going concern and, accordingly, do not include any adjustments that might result from the outcome of this uncertainty. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (a) Basis of Presentation and Principles of Consolidation The consolidated financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles. The consolidated financial statements include the accounts of the Company, its subsidiaries, and its VIE and VIE subsidiaries for which the Company is the primary beneficiary. All significant intercompany accounts and transactions have been eliminated in consolidation. Reverse Stock Split: A one (1)-for-six (6) reverse stock split of the Company’s issued and outstanding ordinary shares was effective on July 30, 2020 (the “Reverse Stock Split”). Except shares authorized, all share and per share information has been retroactively adjusted to give effect to the Reverse Stock Split for all periods presented, unless otherwise indicated. (b) Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. The Company’s significant estimates include its accounts receivable, fair value of stock options and warrants, valuation allowance of deferred tax assets, and other intangible assets. Management makes these estimates using the best information available at the time the estimates are made; however actual results could differ from those estimates. (c) Economic, pandemic, and Political Risks All the Company’s revenue-generating operations are conducted in the PRC. Accordingly, the Company’s business, financial condition and results of operations may be influenced by the political, economic, public health, and legal environments in the PRC, and by the general state of the PRC economy. The Company’s operations in the PRC are subject to special considerations and significant risks that are not typically pertaining to the companies in North America and Western Europe. These include risks associated with, among others, the political, economic, public health, and legal environments and foreign currency exchange. The Company’s financial results may be adversely affected by changes in the political, public health, and social conditions in the PRC, and by changes in governmental policies with respect to laws and regulations, fiscal and monetary policies, anti-inflationary measures, currency conversion, remittances abroad, and rates and methods of taxation. (d) Cash and Cash Equivalents The Company considers all highly liquid investments purchased and cash deposits with financial institutions with original maturities of three months or less to be cash equivalents. The Company had no cash equivalents as of December 31, 2020 or 2019. The Company maintains its cash accounts at credit worthy financial institutions and closely monitors the movements of its cash positions. As of December 31, 2020 and 2019, approximately $0.9 million and $1.5 million of cash, respectively, was held in bank accounts in the PRC. (e) Restricted Cash The Company also held restricted cash of $0.2 million as of December 31, 2020. The restricted fund is a time deposit served as collateral to secure a bank loan facility that matures on May 7, 2021. (f) Accounts Receivable, Accounts Receivable –related parties, and Concentration of Risk In January 2020, the Company adopted ASU 2016-13, Topics 326-Credit Loss, Measurement of Credit Losses on Financial Instruments, which replaces the incurred loss methodology with an expected loss methodology that is referred to as the current expected credit loss (CECL) methodology, as its accounting standard for its trade accounts receivable. The adoption of the credit loss accounting standard has no material impact on the Company’s consolidated financial statements as of January 1, 2020. Accounts receivable are recognized and carried at carrying amount less an allowance for credit loss, if any. The Company maintains an allowance for credit losses resulting from the inability of its customers to make required payments based on contractual terms. The Company reviews the collectability of its receivables on a regular and ongoing basis. The Company has also included in calculation of allowance for credit losses, the potential impact of the COVID-19 pandemic on our customers businesses and their ability to pay their accounts receivable. After all attempts to collect a receivable have failed, the receivable is written off against the allowance. The Company also considers external factors to the specific customer, including current conditions and forecasts of economic conditions, including the potential impact of the COVID-19 pandemic. In the event the Company recovers amounts previously reserved for, the Company will reduce the specific allowance for credit losses. The balance of allowance for credit loss for the year ended December 31, 2020 has increased approximately $14.0 million from the year ended December 31, 2019. The Company evaluates the creditworthiness of all of its customers individually before accepting them and continuously monitors the recoverability of accounts receivable. If there are any indicators that a customer may not make payment, the Company may consider making provision for non-collectability for that particular customer. At the same time, the Company may cease further sales or services to such customer. The following are some of the factors that the Company considers in determining whether to discontinue sales, record as contra revenue or allowance for credit losses: ● the customer fails to comply with its payment schedule; ● the customer is in serious financial difficulty; ● a significant dispute with the customer has occurred regarding job progress or other matters; ● the customer breaches any of the contractual obligations; ● the customer appears to be financially distressed due to economic or legal factors; ● the business between the customer and the Company is not active; and ● other objective evidence indicates non-collectability of the accounts receivable. The Company considers the following factors when determining whether to permit a longer payment period or provide other concessions to customers: ● the customer’s past payment history; ● the customer’s general risk profile, including factors such as the customer’s size, age, and public or private status; ● macroeconomic conditions that may affect a customer’s ability to pay; and ● the relative importance of the customer relationship to the Company’s business. Accounts receivable as at December 31, 2020 and 2019 are as follows: December 31, 2020 December 31, 2019 Accounts Receivable $ 12,359,619 $ 9,611,788 Allowance for credit losses (8,095,362 ) (4,685,707 ) Accounts Receivable, net $ 4,264,257 $ 4,926,081 Accounts Receivable - related parties $ 12,017,651 $ 10,862,238 Allowance for credit losses (9,098,436 ) (2,128,975 ) Accounts Receivable - related parties, net $ 2,919,215 $ 8,733,263 Non-current Accounts Receivable $ 3,013,532 $ 1,804,189 Non-current credit losses (1,174,302 ) (156,080 ) Non-current Accounts Receivable, net $ 1,839,230 $ 1,648,109 Non-current Accounts Receivable - related parties $ 4,172,502 $ 4,035,831 Non-current Allowance for credit losses - related parties (2,849,306 ) (241,882 ) Non-current Accounts Receivable - related parties, net $ 1,323,196 $ 3,793,949 The normal credit term is ranging from 1 month to 3 months after the customers’ acceptance of hardware or software, and completion of services. However, because of various factors of business cycle, the actual collection of outstanding accounts receivable may be beyond the normal credit terms. In accordance with ASC 210-10-45, the non-current accounts receivable and non-current accounts receivable-related parties represent the amounts that the Company does not reasonably expect to be realized during the normal operating cycle of the Company. Considering the limited operating history with the customers and Taoping Alliance members, in accordance with ASC 210-10-45, the operating cycle of the Company is not identifiable. Therefore, the Company uses one-year time period as the basis for the separation of current and non-current assets. The allowance for credit losses at December 31, 2020 and 2019, totaled approximately $21.2 million and $7.2 million, respectively, representing management’s best estimate. The following table describes the movements for allowance for credit losses during the years ended December 31, 2020 and 2019. Balance at January 1, 2019 $ 3,683,842 Increase in allowance for credit losses 3,576,669 Foreign exchange difference (47,867 ) Balance at December 31, 2019 $ 7,212,644 Increase in allowance for credit losses 13,528,638 Foreign exchange difference 476,124 Balance at December 31, 2020 $ 21,217,406 (g) Advances to Suppliers Advances to suppliers represent cash deposits for the purchase of inventory items including but not limited to super-computing server machines from suppliers. (h) Advances from Customers and Related Parties Advances from customers and related parties represent cash received from customers and related parties as advance payments for the purchases of the Company’s products and services. (i) Fair Value and Fair Value Measurement of Financial Instruments Management has estimated that carrying amounts reported in the consolidated balance sheets for cash, accounts receivable, accounts receivable – related party, advances to suppliers, loan receivable - related party, other current assets, accounts payable, other payables and accrued expenses, income taxes payable, convertible note payable, net, and due to related parties approximate their fair market value based on the short-term maturity of these instruments. (j) Fair Value Accounting Financial Accounting Standards Board (FASB) Accounting Standards Codifications (ASC) 820-10 “Fair Value Measurements and Disclosures”, establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). As required by FASB ASC 820-10, assets are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The three levels of the fair value hierarchy under FASB ASC 820-10 are described below: Level 1 Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; Level 2 Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability; and Level 3 Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity). On January 1, 2020, the Company adopted ASU 2018-13,” Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement.” The adoption of the disclosure requirements for Fair Value Accounting has no material impact on the Company’s consolidated financial statements. (k) Inventories, net Inventories are valued at the lower of cost (weighted average basis) or net realizable value. Net realizable value is the expected selling price in the ordinary course of business minus any costs of completion, disposal, and transportation to make the sale. The Company performs an analysis of slow-moving or obsolete inventory periodically and any necessary valuation reserves, which could potentially be significant, are included in the period in which the evaluations are completed. Any inventory impairment results in a new cost basis for accounting purposes. (l) Property, equipment and software, net Property, equipment and software are stated at cost less accumulated amortization and depreciation. Amortization and depreciation is provided over the assets’ estimated useful lives, using the straight-line method. Estimated useful lives of property, equipment and software are as follows: Office buildings 20-50 years Plant and machinery 3-20 years Electronics equipment, furniture and fixtures 3-5 years Motor vehicles 5 years Purchased software 5 years Maintenance and repairs costs are expensed as incurred, whereas significant renewals and betterments are capitalized. (m) Intangible assets, net Intangible assets represent technology, and software development costs and trademarks acquired by the Company through business acquisition. Intangible assets are stated at acquisition fair value or cost less accumulated amortization, and amortized using the straight-line method over the following estimated useful lives: Software development costs 3-5 years Trademarks 5 years (n) Long-term investment. The Company’s long-term investment consists of equity investments without readily determinable fair value. The Company adopted ASU No. 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities (“ASU 2016-01”), codified in ASC Topic 321, Investments—Equity Securities (“ASC 321”), from January 1, 2018. Pursuant to ASC 321, equity investments, except for those accounted for under the equity method, those that result in consolidation of the investee and certain other investments, are measured at fair value, and any changes in fair value are recognized in earnings. For equity securities without readily determinable fair value and do not qualify for the existing practical expedient in ASC Topic 820, Fair Value Measurements and Disclosures (“ASC 820”) to estimate fair value using the net asset value per share (or its equivalent) of the investment, the Company elected to use the measurement alternative to measure those investments at cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer, if any. Significant judgments are required to determine (i) whether observable price changes are orderly transactions and identical or similar to an investment held by the Company; and (ii) the selection of appropriate valuation methodologies and underlying assumptions, including expected volatility and the probability of exit events as it relates to liquidation and redemption features used to measure the price adjustments for the difference in rights and obligations between instruments. For equity investments that the Company elects to use the measurement alternative, the Company makes a qualitative assessment considering impairment indicators to evaluate whether investments are impaired at each reporting date. Impairment indicators considered include, but are not limited to, a significant deterioration in the earnings performance or business prospects of the investee, including factors that raise significant concerns about the investee’s ability to continue as a going concern, a significant adverse change in the regulatory, economic, or technologic environment of the investee and a significant adverse change in the general market condition of either the geographical area or the industry in which the investee operates. If a qualitative assessment indicates that the investment is impaired, the entity has to estimate the investment’s fair value in accordance with the principles of ASC 820. If the fair value is less than the investment’s carrying value, the Company recognizes an impairment loss in net income equal to the difference between the carrying value and fair value. (o) Convertible promissory note The Company determines the appropriate accounting treatment of its convertible debts in accordance with the terms in relation to conversion features. After considering the impact of such features, the Company may account for such instrument as a liability in its entirety, or separate the instrument into debt and equity components following the guidance described under ASC 815 Derivatives and Hedging and ASC 470 Debt. The debt discount, if any, together with related issuance cost are subsequently amortized as interest expense over the period from the issuance date to the earliest conversion date or stated redemption date. The Company presented the issuance cost of debt in the balance sheet as a direct deduction from the related debt. (p) Impairment of Long-Lived Assets Long-lived assets held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of assets may not be recoverable. It is reasonably possible that these assets could become impaired as a result of technology or other industry changes. Recoverability of assets to be held and used is determined by comparing their carrying amount with their expected future net undiscounted future cash flows from the assets. If such assets are considered to be impaired, the impairment to be recognized is measured by how much the carrying amount exceeds the fair value of the assets. There were no impairment charges for the years ended December 31, 2020, 2019 and 2018. Assets held for disposal, if any, are reported at the lower of the carrying amount or fair value less costs to sell. (q) Revenue Recognition Beginning January 1, 2018, the Company has adopted the ASU 2014-09, Topic 606, “Revenue from Contracts with Customers” and its related amendments (collectively referred to as “ASC 606”) as its new revenue recognition accounting policy that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. The adoption of the new revenue recognition standard has no material impact on the Company’s consolidated financial statements for any periods prior to 2018. Therefore prior period amounts are not adjusted. The Company generates its revenues primarily from three sources: (1) product sales, (2) software sales, and (3) other sales. Revenue is recognized when obligations under the terms of a contract with our customers are satisfied; and generally occurs upon delivery of the goods and services. Revenue-Products Product revenues are generated primarily from the sale of Cloud-Application-Terminal based digital ads display terminals with integrated software essential to the functionality of the hardware to our customers (inclusive of related parties) and high-end data storage servers. Although manufacturing of the hardware has been outsourced to the Company’s Original Equipment Manufacturer (OEM) suppliers, the Company has acted as the principal of the contract. The Company recognized the hardware sales at the point of delivery. The Company has indicated that it may from time to time provide future unspecified software upgrades to the hardware products’ essential software, which is expected to be infrequent and, free of charge. Non-software service is mainly the one-time training session provided to the customer to familiarize them with the software operation upon the customer’s initial introduction to the software platform. The costs of providing infrequent software upgrade and training provided to the customer for familiarizing the software operations are de minimis. As a result, the Company does not allocate transaction price to software upgrade and customer training. Product sales are classified as “Revenue-Products” on the Company’s consolidated statements of operations. Revenue-Software Customers in the private sector contract the Company to design and develop software products specifically customized for their needs for a fixed price. Software development projects usually include developing software, integrating various isolated software systems into one, and testing the system. The design and build services, together with the integration of the various elements, are generally determined to be essential to the functionality of the delivered software. The contracted price is usually paid in installments based on progression of the project or at the delivery of the software. The Company usually provides non-software services including after-sale support, technical training. The technical training only occurs at the introduction of the software. The software is highly specialized and stable, after-sale support and subsequent upgrade or enhancement are infrequent. The Company has estimated the costs associated with the non-software performance obligations and concludes that these obligations are de minimis to the overall contract. Therefore, the Company does not further allocate transaction price. The Company usually completes the customized software contracts less than 12 months and recognizes the revenue at the point of delivery because the Company does not have an enforceable right to payment for performance completed to date. Revenues from software development contracts are classified as “Revenue-Software” on the Company’s consolidated statements of operations. Revenue-Other The Company also reports other revenue which comprises revenue generates from System upgrade and technical support services, platform service fee, advertising revenue, and rental income. System upgrade and technical support revenue is recognized when performance obligations are satisfied upon completion of the services. Platform service fee is charged based on number of the display terminals used by the customers or a percentage of advertising revenue generated by the display terminals. Platform service revenue is recognized on a monthly basis over the contract period. The Company recognizes new media advertising revenue upon transferring services for delivering the advertisements as contracted with customers, who rent advertising slots on vehicular display terminals for an agreed upon transaction price. New media advertising revenue is recognized over period of time. On January 1, 2019, the Company adopted ASC 842 – Leases that requires lessor to identify the underlying assets and allocate rental income among considerations in lease and non-lease components. Upon adoption, the Company will recognize a lease liability and corresponding right-to-use asset based on the present value of minimum lease payments. The effects on the results of operations are not expected to be significant, as recognition and measurement of expenses and cash flows for leases will be substantially the same under the new standard. Therefore, prior period amounts are not adjusted. The Company owns two units of office space renting out to a third party and a related party under non-cancelable operating lease agreements with lease terms of six years starting from May 1, 2016 and three years starting from July 1, 2019, respectively. The lease agreements have fixed monthly rental payments, and no non-lease component or option for lessees to purchase the underlying assets. The Company collects monthly rental payments from the lessees, and has generated approximately $405,000 and $420,000 rental income for the years ended December 31, 2020, and 2019, respectively. Annual minimum lease payments to be received in the next 5 years: 2021 378,940 2022 136,452 Total 515,392 Contract balances The Company records advances from customers when cash payments are received or due in advance of our performance. For the year ended December 31, 2020, 2019 and 2018, the Company recognized revenue of approximately $256,000, $335,000 and $1,290,000, respectively, that was included in the advances from customers balance at the beginning of each reporting period. Practical expedients and exemptions The Company generally expenses sales commissions if any incurred because the amortization period would have been one year or less. In many cases, the Company is approached by customers for customizing software products for their specific needs without incurring significant selling expenses. The Company does not disclose the value of unsatisfied performance obligations for contracts with an original expected length of one year or less. (r) Treasury Stock The Company repurchases its ordinary shares from time to time in the open market and holds such shares as treasury stock. The Company applies the “cost method” and presents the cost to repurchase such shares as a reduction in equity. (s) Stock-based compensation The Company applies ASC No. 718, “Compensation-Stock Compensation”, which requires that share-based payment transactions with employees, such as share options, be measured based on the grant date fair value of the equity instrument and recognized as compensation expense over the requisite service period, with a corresponding addition to equity. Under this method, compensation cost related to employee share options or similar equity instruments is measured at the grant date based on the fair value of the award and is recognized over the period during which an employee is required to provide service in exchange for the award, which generally is the vesting period. The Company adopted ASU 2018-07, Compensation-Stock Compensation (Topic: 718): Improvements to Nonemployee Share-Based Payment Accounting on January 1, 2019, to account for stock-based compensation to goods and services provided by the third parties. The fair value of the equity awards to nonemployee are measured on the grant day. Under this guidance, compensation cost related to nonemployee share options or similar equity instruments is recognized in the same period and in the same manner (i.e. capitalize or expense) the entity would if it paid cash for the goods or services. The Company’s adoption of ASU 2018-07 has no material impact to the Company’s consolidated financial statements, nor requirement for cumulative adjustment in retained earnings or other components of equity or net assets. During the year ended December 31, 2020, 2019, and 2018, the Company recognized approximately $744,000, $580,000 and $629,000, respectively, of stock-based compensation expense. (t) Foreign Currency Translation The functional currency of the US and BVI companies is the United States dollar. The functional currency of the Company’s Hong Kong subsidiaries is the Hong Kong dollar. The functional currency of the Company’s wholly-owned PRC subsidiaries and its VIE is the Chinese Renminbi Yuan, (“RMB”). RMB is not freely convertible into foreign currencies. The Company’s PRC subsidiaries’ and their VIE’s financial statements are maintained in the functional currency. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency at rates of exchange prevailing at the balance sheet date. Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transactions. Exchange gains or losses arising from foreign currency transactions are included in the determination of net loss for the respective periods. For financial reporting purposes, the financial statements of the Company have been translated into United States dollars. Assets and liabilities are translated at exchange rates at the balance sheet dates, revenue and expenses are translated at average exchange rates, and equity is translated at historical exchange rates. Any resulting translation adjustments are not included in determining net income but are included in other comprehensive loss, a component of equity. The exchange rates adopted are as follows: December 31, 2020 December 31, 2019 Year-end RMB to US$ exchange rate 6.5377 6.9692 Average yearly RMB to US$ exchange rate 6.9044 6.9072 The average yearly RMB to US$ exchange rate adopted for the year ended December 31, 2018 was 6.8787. No representation is made that the RMB amounts could have been, or could be, converted into United States dollars at the rates used in translation. (u) Research & Development Expenses The Company follows the guidance in FASB ASC 985-20, Cost of Software to Be Sold, Leased or Marketed, regarding software development costs to be sold, leased, or otherwise marketed. FASB ASC 985-20-25 requires research and development costs for software development to be expensed as incurred until the software model is technologically feasible. Technological feasibility is established when the enterprise has completed all planning, designing, coding, testing, and identification of risks activities necessary to establish that the product can be produced to meet its design specifications, features, functions, technical performance requirements. A certain amount of judgment and estimation is required to assess when technological feasibility is established, as well as the ongoing assessment of the recoverability of capitalized costs. The Company’s products reach technological feasibility shortly before the products are released and sold to the public. Therefore research and development costs are generally expensed as incurred. (v) Subsidy Income Subsidy income mainly represents income received from various local governmental agencies in China for developing high technology products in the fields designated by the government as new and highly innovative. The Company has no continuing obligation under the subsidy provision. The Company recognizes subsidy income upon receipt of official grant notice from local government authorities. (w) Sales, use, other value-added taxes, and income taxes Revenue is recorded net of applicable sales, use, and value-added taxes. Income taxes are provided on an asset and liability approach for financial accounting and reporting of income taxes. Deferred income taxes are recognized for all significant temporary differences at enacted rates and classified as non-current in the financial statements. A valuation allowance is provided to reduce the amount of deferred tax assets if it is considered more likely than not that some portion, or all of, the deferred tax assets will not be realized. The Company classifies interest and/or penalties related to unrecognized tax benefits, if any, as a component of income tax expense. The Company applies the provisions of ASC No. 740 “Income Taxes” (“ASC 740”), which clarifies the accounting for uncertainty in income taxes recognized by prescribing a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC 740 also provides accounting guidance on de-recognition, classification, interest and penalties, and disclosure. (x) Discontinued Operations The Company follows “ASU 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity” for reporting discontinued operations. Under the revised standard, a discontinued operation must represent a strategic shift that has or will have a major effect on an entity’s operations and financial results. Examples could include a disposal of a major line of business, a major geographical area, a major equity method investment, or other major parts of an entity. The revised standard also allows an entity to have certain continuing cash flows or involvement with the component after the disposal. Additionally, the standard requires expanded disclosures about discontinued operations that will provide financial statement users with more information about the assets, liabilities, income, and expenses of discontinued operations. (y) Segment reporting Segment information is consistent with how management reviews the businesses, makes investing and resource allocation decisions and assesses operating performance. Transfers and sales between reportable segments, if any, are recorded at cost. ASC 280, Disclosures about Segments of an Enterprise and Related Information establishes standards for reporting information about operating segments. Operating segments are defined as components of an enterprise which engage in business activities from which they may earn revenues and incur expenses, and about which separate financial information is available that is evaluated regularly by the chief operating decision-maker, or decision-making group, in deciding how to allocate resources and in assessing performance. Reportable segments are defined as an operating segment that either (a) exceeds 10% of revenue, or (b) rep |
Variable Interest Entity
Variable Interest Entity | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Variable Interest Entity | 3. VARIABLE INTEREST ENTITY The Company is the primary beneficiary of iASPEC, pursuant to the Amended and Restated MSA. iASPEC is qualified as a variable interest entity of the Company and is subject to consolidation. Accordingly, the assets and liabilities and revenues and expenses of iASPEC have been included in the accompanying consolidated financial statements. In the opinion of management, (i) the ownership structure of the Company, and the VIEs are in compliance with existing PRC laws and regulations; (ii) the contractual arrangements with the VIEs and its shareholder are valid and binding, and do not result in any violation of PRC laws or regulations currently in effect; and (iii) the Company’s business operations are in compliance with existing PRC laws and regulations in all material respects. However, there are substantial uncertainties regarding the interpretation and application of current and future PRC laws and regulations. China’s legal system is a civil law system based on written statutes and unlike common law systems. It is a system in which decided legal cases have little value as precedent. As a result, China’s administrative and judicial authorities have significant discretion in interpreting and implementing statutory and contractual terms. Thus, it may be more difficult to evaluate the outcome of administrative and judicial proceedings and the level of legal protection available than in more developed legal systems. Accordingly, the Company cannot be assured that PRC regulatory authorities will not ultimately take a contrary view to its opinion with respect to the contractual arrangements with its VIEs. Because all of these contractual arrangements are governed by the PRC laws and provide for the resolution of disputes through arbitration in the PRC, these contracts would be interpreted in accordance with the PRC laws and any dispute would be resolved in accordance with the PRC legal procedures. If the VIEs or their respective shareholders fail to perform their respective obligations under the contractual arrangements, of which they are a party, the Company may have to incur substantial costs and resources to enforce its rights under the contracts and rely on legal remedies under the PRC laws, which may not be sufficient or effective. Under the PRC laws, rulings by arbitrators are final; parties cannot appeal the arbitration results in courts; and the prevailing parties may only enforce the arbitration awards in the PRC courts through arbitration award recognition proceedings, which would cause the Company to incur additional expenses and delays. As a result, uncertainties in the PRC legal system could limit the Company’s ability to enforce these contractual arrangements. In the event the Company is unable to enforce these contractual arrangements, it may not be able to exert effective control over the VIEs, and its ability to conduct its business may be negatively affected. In addition, if the PRC government determines that the Company is not in compliance with applicable laws, it may revoke the Company’s business and operating licenses, and require the Company to discontinue or restrict its operations, deconsolidate the Company’s interests in the VIEs, restrict its right to collect revenues. The PRC government may require the Company to restructure its operations, impose additional conditions, of which the Company may not be able to comply, impose restrictions on the Company’s business operations or on its customers, or take other regulatory or enforcement actions against the Company that could be harmful to its business. The Company believes that the contractual arrangements with its VIEs are in compliance with current PRC laws and are legally enforceable. In the opinion of management, the likelihood of loss in respect to the Company’s current ownership structure or the contractual arrangements with VIEs is remote based on current facts and circumstances. For the years ended December 31, 2020, 2019 and 2018, net loss of $636,433, net loss of $11,929, a net income of $186,803, respectively, have been attributed to non-controlling interest in the consolidated statements of operations of the Company. Government licenses, permits and certificates represent substantially all of the unrecognized revenue-producing assets held by the VIEs. Recognized revenue-producing assets held by the VIEs consist of property, plant and equipment, and intangible assets. The VIE’s assets and liabilities were as follows as of December 31, 2020 and 2019: December 31, 2020 December 31, 2019 Total current assets $ 9,261,921 $ 17,854,356 Other assets, non-current 4,302,000 4,304,640 Non-current accounts receivable, net 2,101,276 4,985,479 Property, plant and equipment 3,713,860 3,516,313 Intangible assets - - Total assets 19,379,057 30,660,788 Intercompany payable to the WFOE 20,449,508 19,623,596 Total current liabilities 41,717,595 39,005,733 Total liabilities 41,717,595 39,005,733 Total equity $ (22,338,538 ) $ (8,344,945 ) |
Disposals of Consolidated Entit
Disposals of Consolidated Entities | 12 Months Ended |
Dec. 31, 2020 | |
Disposals Of Consolidated Entities | |
Disposals of Consolidated Entities | 4. DISPOSALS OF CONSOLIDATED ENTITIES SZ iASPEC was dissolved on October 26, 2018. The dissolution of SZ iASPEC did not result in any gain or loss for the year ended December 31, 2018. None of the above-referenced disposals in 2018 qualified as discontinued operations as they do not individually or in the aggregate represent a strategic shift that has had a major impact on the Company’s operations or financial results. |
Earnings (Loss) Per Share
Earnings (Loss) Per Share | 12 Months Ended |
Dec. 31, 2020 | |
(Loss) earnings per share - Basic and Diluted | |
Earnings (Loss) Per Share | 5. EARNINGS (LOSS) PER SHARE Basic earnings (loss) per share is computed by dividing earnings (loss) available to common shareholders by the weighted-average number of ordinary shares outstanding during the period. Diluted earnings (loss) per share reflects the potential dilution that could occur, if securities or other contracts to issue ordinary shares were exercised or converted into ordinary shares, or resulted in the issuance of ordinary shares that shared in the earnings of the entity. Components of basic and diluted earnings (loss) per share were as follows for the year ended December 31, 2020, 2019, and 2018: 2020 2019* 2018* Net (loss) income attributable to the Company $ (17,694,775 ) $ (3,582,332 ) $ 1,691,983 Weighted average outstanding ordinary shares-Basic 7,373,347 6,964,740 6,809,938 -dilutive effect of stock options- employees - - 111,553 -dilutive effect of stock options- nonemployees - - 6,106 Weighted average outstanding ordinary shares- Diluted 7,373,347 6,964,740 6,927,597 (Loss) earnings per share: Basic $ (2.40 ) $ (0.54 ) $ 0.24 Diluted $ (2.40 ) $ (0.54 ) $ 0.24 For the years ended December 31, 2020, 2019, and 2018, 0 shares, 0 shares, and 117,659 shares were included in the diluted earnings per share calculation, respectively. These incremental shares were added to denominator for the period that stock options were outstanding due to the average market price of the Company’s stock in the period exceeded the exercise prices of the stock options granted to the Company’s employees and various consultants. The incremental shares were computed under the treasury stock method. The EPS calculation excluded the if-converted shares from the convertible promissory note or exercised shares from detachable warrant associated with the convertible promissory note based on the Company’s recent stock prices, which were significantly below the stated convertible price and among other conversion prices of alternative conversions or exercise price of the warrant. Because the effect would be anti-dilutive, there were warrants associated with the convertible promissory notes for purchase of 133,334 shares that were not included in the computation of dilutive weighted average shares outstanding for the year ended December 31, 2020. Also, 296,900 stock options and warrants for the purchase of 51,667 shares were not included in the calculations for the years ended December 31, 2019, and warrants for the purchase of 158,333 shares were not included in the calculations for the years ended December 31, 2018, as their effect would have been anti-dilutive. *On July 30, 2020, the Company implemented a one-for-six reverse stock split of the Company’s issued and outstanding ordinary shares. Except shares authorized, all share and per share information has been retroactively adjusted to give effect to the reverse stock split for all periods presented, unless otherwise indicated. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2020 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 6. RELATED PARTY TRANSACTIONS (a) Revenue – related party Since May 2017, the Company has entered into a series of contracts with Taoping New Media Co., Ltd. (Taoping New Media) and its affiliates for the sale of the Company’s Cloud-Application-Terminal based digital ads display terminals, software and technical services. Taoping New Media is a related party company controlled by Mr. Lin, the Company’s Chairman and Chief Executive Officer. For the years ended December 31, 2020, 2019 and 2018, revenues from related parties for sales of products were approximately $0.4 million, $7.4 million and $9.4 million, respectively. Accounts receivable from related parties, net of allowance for credit losses, as of December 31, 2020, 2019 and 2018 were approximately $4.2 million, $12.5 million and $9.5 million, respectively. Advances received from related parties were $161,063, $140,938 and $51,183 as of December 31, 2020, 2019 and 2018, respectively. (b) Other revenue – related parties On July 1, 2017, the Company entered into a lease agreement with Taoping New Media for leasing the Company’s office space located at 18th Floor, Education and Technology Building, Zhuzilin, Futian District, Shenzhen City which has been renewed on July 1, 2019 and expires on June 30, 2022. For the years ended December 31, 2020, 2019 and 2018, the Company’s rental income from related party were approximately $61,000, $61,000 and $63,000, respectively. Other revenue generated from related parties also includes system maintenance service provided to Taoping affiliate customers, which was $85,289, $44,621 and $22,416, for the years ended December 31, 2020, 2019 and 2018, respectively. (c) Services purchase – related party iASPEC and Bocom each has a total of $69,585 and $65,276 payable to Taoping New Media as of December 31, 2020 and 2019, respectively, for certain consultation service provided by Taoping New Media during 2018. The balance will be paid off in 2021. No consultation service was provided in 2020 and 2019. (d) Loan receivable – related party As of December 31, 2020 and 2019, the Company recorded $0.5 million and $0.4 million loan receivable from Taoping New Media, which is for short-term loan without interest, and is expected to be fully repaid by September 2021. (e) Amount due to related party As of December 31, 2020 and 2019, the balance of due to related party was $0.14 million and $0.13 million, respectively, which was borrowed from Taoping New Media for working capital purpose. The balance was due on demand without interest. |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2020 | |
Inventory Disclosure [Abstract] | |
Inventories | 7. INVENTORIES As of December 31, 2020 and 2019, inventories consist of: December 31, 2020 December 31, 2019 Raw materials $ 3,663 $ 3,437 Finished goods 427,942 453,634 Cost of projects 34,792 49,233 $ 466,397 $ 506,304 Allowance for slow-moving or obsolete inventories (211,719 ) (203,366 ) Inventories, net $ 254,678 $ 302,938 For the year ended December 31, 2020, 2019, and 2018, impairments expense for obsolete inventories were approximately $6,000, $115,000 and $30,000, respectively. |
Property, Equipment and Softwar
Property, Equipment and Software, Net | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property, Equipment and Software, Net | 8. PROPERTY, EQUIPMENT AND SOFTWARE, NET As of December 31, 2020 and 2019, property, equipment and software consist of: December 31, 2020 2019 Office buildings $ 5,140,635 $ 4,822,303 Electronic equipment, furniture and fixtures 5,470,985 5,029,249 Motor vehicles 201,509 242,265 Purchased software 17,465,168 15,538,161 28,278,297 25,631,978 Less: accumulated depreciation (17,426,398 ) (13,796,462 ) Property, equipment and software, net $ 10,851,899 $ 11,835,516 Depreciation expense for the year ended December 31, 2020, 2019, and 2018 were approximately $3.2 million, $2.8 million and $2.9 million, respectively. Company’s office buildings, with net carry value of approximately $3.0 million, are used as collateral for its short-term bank loan. |
Intangible Assets, Net
Intangible Assets, Net | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets, Net | 9. INTANGIBLE ASSETS, NET As of December 31, 2020 and 2019, intangible assets consist of: Software and software development costs Trademarks Total Gross carrying amounts Balance as of January 1, 2019 $ 4,083,543 892,848 4,976,391 Foreign currency translation (53,061 ) (11,603 ) (64,664 ) Balance as of December 31, 2019 4,030,482 881,245 4,911,727 Foreign currency translation 266,062 58,173 324,235 Balance as of December 31, 2020 4,296,545 939,419 5,235,964 Accumulated amortization Balance as of January 1, 2019 4,037,464 879,006 4,916,470 Amortization expense 45,889 12,275 58,164 Foreign currency translation (52,871 ) (11,532 ) (64,403 ) Balance as of December 31, 2019 4,030,482 879,749 4,910,231 Amortization expense - 1,510 1,510 Foreign currency translation 266,062 58,160 324,221 Balance as of December 31, 2020 4,296,545 939,419 5,235,964 Intangible assets, net $ - $ - $ - Amortization expense for the year ended December 31, 2020, 2019 and 2018 was approximately $1,510, $0.06 million and $0.7 million, respectively. Intangible assets were fully amortized in 2020. |
Bank Loans
Bank Loans | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Bank Loans | 10. BANK LOANS December 31, 2020 December 31, 2019 Secured short-term loans $ 6,210,176 $ 6,584,664 Total short-term bank loans $ 6,210,176 $ 6,584,664 Detailed information of secured short-term loan balances as of December 31, 2020 and 2019 were as follows: December 31, 2020 December 31, 2019 Collateralized by office buildings of IST and guaranteed by Mr. Lin and Biznest $ 3,976,960 $ 4,017,664 Guaranteed by IST and Mr. Lin and Collateralized by the real property of ISIOT and equity investment of ISTIL 2,019,072 1,985,874 Guaranteed by IST and guaranteed by Mr. Lin and guaranteed by DU YONG - 258,278 Guaranteed by a $ 0.2 million restricted bank time deposit 214,144 Guaranteed by High-tech Investment Company(i) and Mr. Lin - 322,848 Total $ 6,210,176 $ 6,584,664 (i) High-tech Investment Company is an unrelated third party. As of December 31, 2020 the Company had short-term bank loans of approximately $6.2 million, which mature on various dates from April 29, 2021 to September 14, 2021. The short-term bank loans may be extended for another year by the banks without additional charges to the Company upon maturity. The bank borrowings are in the form of credit facilities. Amounts available to the Company from the banks are based on the amount of collateral pledged or the amount guaranteed by the Company’s subsidiaries. These borrowings bear interest rates ranging from 4.95% to 6.22% per annum. The weighted average interest rates on short term debts were approximately 5.59%, 6.56% and 6.43% for the year ended December 31, 2020, 2019, and 2018, respectively. The interest expenses were approximately $0.4 million, $0.5 million and $0.5 million, respectively, for the same periods, respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 11. INCOME TAXES Pre-tax income (loss) from continuing operations for the year ended December 31, 2020, 2019, and 2018 were taxable in the following jurisdictions: 2020 2019 2018 PRC $ (15,810,350 ) $ (2,342,102 ) $ 2,371,708 Hong Kong (12,072 ) (38,574 ) (28,177 ) BVI (2,580,102 ) (1,488,065 ) (1,665,976 ) Total (loss) income before income taxes $ (18,402,524 ) $ (3,868,741 ) $ 677,555 United States Because of the domestication transaction in 2012 by which CNIT BVI became the parent of our group, under Section 7874 of the Internal Revenue Code of 1986, as amended, the Company is treated for U.S. federal tax purposes as a U.S. corporation and, among other consequences, is subject to U.S. federal income tax on its worldwide income. It is management’s intention to reinvest all the income attributable to the Company earned by its operations outside the United States. On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the “Act”). The Act makes broad and complex changes to the U.S. tax code, including, but not limited to, (1) reducing the U.S. federal corporate tax rate from 35 percent to 21 percent; (2) requiring companies to pay a one-time transition tax on certain unrepatriated earnings of foreign subsidiaries; (3) generally eliminating U.S. federal income taxes on dividends from foreign subsidiaries; (4) requiring a tax on Global Intangible Low-Taxed Income (“GILTI”) which is a current inclusion in U.S. federal taxable income of certain earnings of controlled foreign corporations; (5) eliminating the corporate alternative minimum tax (“AMT”) and changing how existing AMT credits can be realized; (6) creating the base erosion anti-abuse tax (“BEAT”), a new minimum tax; (7) creating a new limitation on deductible interest expense; and (8) changing rules related to uses and limitations of net operating loss carryforwards created in tax years beginning after December 31, 2017. The SEC staff issued Staff Accounting Bulletin 118, which provides guidance on accounting for the tax effects of the Act for which the accounting under ASC 740, Income Taxes (“ASC 740”) is incomplete. To the extent that a company’s accounting for certain income tax effects of the Act is incomplete but it is able to determine a reasonable estimate, it must record a provisional estimate in the financial statements. If a company cannot determine a provisional estimate to be included in the financial statements, it should continue to apply ASC 740 on the basis of the provisions of the tax laws that were in effect immediately before enactment of the Act. The Company from time to time evaluates the tax effect of GILTI, and determined that there was no impact of GILTI tax to the Company’s consolidated financial statements as of December 31, 2020. BVI Under the current laws of the BVI, dividends and capital gains arising from the Company’s investments in the BVI and ordinary income, if any, are not subject to income taxes. Hong Kong Under the current laws of Hong Kong, IST HK is subject to a profit tax rate of 16.5%. PRC Income tax (benefit) expense from continuing operations consists of the following: 2020 2019 2018 Current taxes $ (71,316 ) $ (274,480 ) $ (1,201,231 ) Deferred taxes - - - Income tax (benefit) $ (71,316 ) $ (274,480 ) $ (1,201,231 ) Current income tax (benefit) expense was recorded in 2020, 2019 and 2018 and was related to differences between the book and corporate income tax returns. 2020 2019 2018 PRC statutory tax rate 25 % 25 % 25 % Computed expected income tax (benefit) expense $ (4,600,631 ) $ (967,185 ) $ 169,389 Tax rate differential benefit from tax holiday 1,805,951 180,996 (246,999 ) Permanent differences 248,636 (203,842 ) (1,376,474 ) Tax effect of deductible temporary differences not recognized 1,826,684 333,891 (170,685 ) Non-deductible tax loss 648,044 381,660 423,538 Income tax (benefit) $ (71,316 ) $ (274,480 ) $ (1,201,231 ) The significant components of deferred tax assets and deferred tax liabilities were as follows as of December 31, 2020 and 2019: December 31, 2020 December 31, 2019 Deferred Deferred Deferred Deferred Tax Tax Tax Tax Assets Liabilities Assets Liabilities Allowance for credit losses $ 3,640,083 $ - $ 1,670,652 $ - Loss carry-forwards 3,714,825 - 2,326,787 - Fixed assets 80,456 (258,451 ) 22,635 (243,517 ) Inventory valuation 369,064 - 332,760 - Long-term investments 5,736 - 5,381 - Intangible assets - 134,197 - 125,887 Gross deferred tax assets and (liabilities) 7,810,164 (124,254 ) 4,358,215 (117,630 ) Valuation allowance (7,685,910 ) - (4,240,585 ) - Total deferred tax assets and (liabilities) $ 124,254 $ (124,254 ) $ 117,630 $ (117,630 ) The Company has net operating loss carry forwards totaling RMB153.1 million ($23.4 million) as of December 31, 2020, substantially all of which were from PRC subsidiaries and will expire on various dates through December 31, 2025. Valuation allowance for deferred tax asset was fully provided. IST is approved as being high-technology enterprises and subject to PRC enterprise income tax rate (“EIT”) at 15%. For Biznest, the income tax starts from the earning year, tax free for the first two years and 12.5% income tax rate for year 3-5. The Company recognizes that virtually all tax positions in the PRC are not free of some degree of uncertainty due to tax law and policy changes by the State. However, the Company cannot reasonably quantify political risk factors and thus must depend on guidance issued by current State officials. Based on all known facts, circumstances, and current tax law, the Company has recorded nil unrecognized tax benefits from year 2018 to 2020. The Company believes that there are no tax positions for which it is reasonably possible, based on current Chinese tax laws and policies, that the unrecognized tax benefits will significantly increase or decrease over the next 12 months, individually or in the aggregate, and have a material effect on the Company’s results of operations, financial condition or cash flows. The Company’s policy is to recognize interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense. Any accrued interest or penalties associated with any unrecognized tax benefits were not significant for the year ended December 31, 2020, 2019, and 2018. Since the Company intends to reinvest its earnings to further expand its businesses in the PRC, the PRC subsidiaries do not intend to declare dividends to their parent companies in the foreseeable future. The Company’s foreign subsidiaries are in a cumulative deficit position. Accordingly, the Company has not recorded any deferred taxes on the cumulative amount of any undistributed deficit. It is impractical to calculate the tax effect of the deficit at this time. |
Other Current and Non-Current A
Other Current and Non-Current Assets | 12 Months Ended |
Dec. 31, 2020 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Other Current and Non-Current Assets | 12. OTHER CURRENT AND NON-CURRENT ASSETS (a) As of December 31, 2020 and 2019, other current assets consist of: December 31, 2020 December 31, 2019 Advances to unrelated-parties (i) $ 8,305 $ 1,835,826 Advances to employees 45,396 64,777 Other current assets 119,325 187,343 $ 173,026 $ 2,087,946 (i) The advances to unrelated parties for business development, and are non-interest bearing and due on demand. As of December 31, 2019, included in the balance of advances to unrelated parties, $1.8 million was the amount due from one unrelated party, which consisted of $0.16 million interest receivables related to a loan agreement entered during 2018 and $1.66 million advances for business development purposes which were non-interest bearing and due on demand. During the year ended December 31, 2020, the Company has fully collected the balance from this unrelated party. (b) As of December 31, 2020 and 2019, Other assets, non-current consist of: December 31, 2020 December 31, 2019 Other assets, non-current, net $ 4,302,000 $ 4,304,640 $ 4,302,000 $ 4,304,640 As of December 31, 2019, the Company advanced RMB 30 million (USD $4.3 million) to a vendor, whom the Company has contracted to develop a vehicular IOT smart advertising software (“Internet of Vehicle” or “IOV” software) to interconnect to the Company’s new media advertising sharing platform expanding its advertising capability to people riding in motor vehicles. According to the contract and its subsequent amendment, total commitment of the funding was RMB 30 million (USD $4.3 million). The vendor is solely responsible for hardware and software development and marketing the vehicular terminal. The Company financially supports development cost of IOV software in exchange for advertising revenue generated from the software for four years of the contract term. Based on the amendment of the contract, if the Company’s new media advertising revenue generated from IOV software does not reach certain threshold during specified period, the contract could be terminated by the Company, and all funding with applicable interest, and less the revenue generated from the IOV software shall be repaid to the Company within half year after the termination of the contract. Once the vendor fully repays the total funding plus applicable interest, the vendor will own 100% the title of the vehicular terminal and related equipment. The first period as specified was from October 1, 2020 to April 30, 2021 with a threshold advertising revenue from IOV software of RMB 3 million (approximately USD $462,000). The threshold revenue is to increase incrementally by 15% in every six months going forward until the contract expires four years after the commencing date of the operation. As of April 30, 2021, revenue generated from the IOV software has reached RMB 3.0 million (approximately USD $462,000). The Company will continue to monitor advertising revenue generation from the IOV software and evaluate for impairment, if an event occurs or circumstance changes that would potentially indicate that the carrying amount of the asset exceeded its fair value. The vendor will own the title of the IOV software upon its fulfillment of the contract obligations after four years. The development of IOV software was completed by September 30, 2020. Since Company has the right to use the IOV software in the contract term, software was capitalized as “other assets, non-current, net” and started to amortize from October 1, 2020 over the four-year contract term. As of December 31, 2020, the balance of “other assets, non-current, net” was $4,302,000, after amortization of approximately $0.3 million for the year ended December 31, 2020. |
Convertible Note Payable
Convertible Note Payable | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Convertible Note Payable | 13. CONVERTIBLE NOTE PAYABLE In October 2019, March 2020, and September 2020, the Company completed three financing transactions (SPA-1, SPA-2, and SPA-3, collectively “SPAs”) through private placements. All SPAs issued Convertible Promissory Notes (Note-1, Note-2, and Note-3, collectively “Notes”) in principal amount of $1.04 million for Note-1, $1.48 million for Note-2, and $1.48 million for Note-3. All three Notes mature in 12 months from the issue dates of the Notes (the “Maturity Dates”), with an interest rate of 5% per annum. The three Notes carry an original issue discount (OID) of $40,000, $80,000, and $80,000, respectively, to cover investors’ transaction costs of the Notes. The proceeds net of issuance cost and debt discount of Note-1, Note-2, and Note-3 were $1 million, $1.34 million, and $1.34 million, respectively. All three Notes are convertible into the Company’s ordinary shares at $9.0 per share at the holder’s option at any time on or before Maturity dates. Upon occurrence of default events, the holders of the Notes are entitled to alternate conversions that offer holders of the Notes the most favorable conversion price based on various adjustments, while the number of the Company’s shares upon conversion shall not exceed 470,000 shares for Note-1, 1,000,000 shares for Note-2 and Note-3. On the Maturity Dates, the holders of the Notes have the rights to convert all of the outstanding balance of the Notes at a price of no less than $3.0 per share for Note-1 and $2.4 per share for Note-2 and Note-3. In conjunction with issuance of the Notes, the Company also issued the holders of the Notes warrants to purchase 26,667, 53,334, and 53,334 ordinary shares of the Company, respectively, with an exercise price at $9.0 per share and a cashless-exercise option. The warrants will expire in three years from the dates of issuance. The warrants are also subject to exercise price adjustments upon occurrence of stock splits, stock dividends, reorganization or similar events. The investors of SPA-2 also purchased an aggregate of 285,714 shares of the Company’s ordinary Shares with no par value at a price of $2.1 per share pursuant to the Purchase Agreements. The investors of SPA-3 also purchased an aggregate of 222,222 shares of the Company’s ordinary Shares with no par value at a price of $2.7 per share pursuant to the Purchase Agreements. Thus, aggregate proceeds net of issuance cost and debt discount of the SPA-1, SPA-2, and SPA-3 were $1 million, $1.9 million, and $1.9 million, respectively. The detachable warrants issued to holders of the Notes are considered being indexed to the Company’s own stock and classified in stockholders’ equity and therefore they meet the scope exception prescribed in ASC 815-10-15. The warrants are initially measured at fair value of $11,250 for Note-1, $11,676 for Note-2, and $18,275 for Note-3 by using Black-Scholes Merton Valuation Model with no subsequent adjustment of fair value in accordance with ASC 815. The Company assessed the accounting for the Notes in accordance with ASC 470-20 allocating the proceeds to convertible notes and the detachable warrants on their relative fair value basis, in the amount of $988,874 and $ 11,126, respectively, for Note-1, $1,388,420 and $ 11,580, respectively, for Note-2, $1,381,960 and $18,040, respectively, for Note-3. For the holders of the Notes, conversion prices result in beneficial conversion feature (BCF) that is separated as an equity component and assigned Note-1, Note-2, and Note-3 values of $113,526, $165,580, and $246,040, respectively, which are the intrinsic values of the BCF for Note-1, Note-2, and Note-3 that are measured by differences between the effective conversion prices based on the proceeds allocated to the convertible instruments and the fair value of the ordinary shares and recorded as a debt discounts. Debt discounts are amortized using the effective interest rate method over the periods from the issuance dates through the stated maturity dates. The Notes are recognized initially at fair values, net of debt discounts including original issue discounts (OID) and allocations of proceeds to beneficial conversion features and the detachable warrants, in the amount of $164,651 for Note-1, $257,159 for Note-2, and $344,079 for Note-3. The Notes of SPA-1 and SPA-2 along with accrued interests were fully converted to the Company’s ordinary shares with no par value in three conversions taking place in September, October, and December 2020. As of December 31, 2020, the Note-3 remaining unamortized debt discount was $257,352, and will be amortized through September 30, 2021. Amortizations of issuance costs and other Discounts accretion are recorded as interest expenses in the consolidated statement of comprehensive income. The Company incurred $80,000 and $80,874 of finder fee for SPA-2 and SPA-3, respectively. For SPA-2, the finder fee was assigned to an equity component of $24,000 and a debt discount of $56,000 proportionally. For SPA-3, the finder fee was assigned to an equity component of $24,262 and a debt discount of $56,612 proportionally. The Company recognized interest expense of approximately $160,216 for Note-1, $244,871 for Note-2, and $119,648 for Note-3 for the period ended December 31, 2020 including interest relating to contractual interest obligation approximately of $37,000 and amortization of the discounts and debt issuance cost approximately of $124,000 for Note-1 and interest relating to contractual interest obligation approximately of $46,000 and amortization of the discounts and debt issuance cost approximately of $199,000 for Note-2, and interest relating to contractual interest obligation approximately of $19,000 and amortization of the discounts and debt issuance cost approximately of $101,000 for Note-3. As of December 31, 2020, the balance of principal and accrued interest of Note-1 and Note-2 were fully converted to the Company’s ordinary shares (see Note 16 Equity), and the outstanding balance of Note-3 net of unamortized debt discount was $1,180,908. Note-1 was modified on September 28, 2020 by adding a paragraph of “Quarterly Conversion” with a floor price of $2.4 per share and the original floor price of $3 per share for conversion upon maturity was amended into $2.4 per share. Because the difference in fair value of embedded conversion feature immediately before and immediately after the modification was approximately $21,000, which is less than 10% of the initial fair value of the Note, it was considered a modification effectuated on September 28, 2020. The Company recognized the increase in the fair value of the embedded conversion option of approximately $21,000 as a debt discount with a corresponding increase in additional paid-in capital. |
Other Payables and Accrued Expe
Other Payables and Accrued Expenses | 12 Months Ended |
Dec. 31, 2020 | |
Other Liabilities Disclosure [Abstract] | |
Other Payables and Accrued Expenses | 14. OTHER PAYABLES AND ACCRUED EXPENSES As of December 31, 2020 and 2019, other payables and accrued expenses consist of: December 31, 2020 December 31, 2019 Advances from unrelated third-parties (i) $ 469,418 $ 115,760 Other taxes payable (ii) 4,089,013 3,927,037 Unrecognized tax benefits (iii) 433,000 433,000 Accrued professional fees 404,025 190,640 Amount due to employees (iv) 65,785 51,188 Other current liabilities (v) 1,174,856 180,047 $ 6,636,097 $ 4,897,672 (i) The advances from unrelated parties are non-interest bearing and due on demand. (ii) The other taxes payable were the amounts due to the value added tax, business tax, city maintenance and construction tax, and individual income tax. The increase in other taxes payable was mainly attributed to reassessment of prior years’ business tax, value added tax, land use tax, and other auxiliary taxes. (iii) The Unrecognized tax benefits refer to the land value added tax due to the sale of property, equipment, and land use rights in September 2015. (iv) The amounts due to employees were pertaining to employees’ out-of-pocket expenses for travel and meal allowance, etc. (v) The other current liabilities included the following: a) approximate of $89,000 loss on a customer’s bankruptcy claim, b) approximate of $203,000 loss on return of prior year’s government funding, c) an amount of $767,500 for ordinary shares converted from the convertible debt, which were not yet issued as of December 31, 2020. |
Reserve and Distribution of Pro
Reserve and Distribution of Profit | 12 Months Ended |
Dec. 31, 2020 | |
Reserve And Distribution Of Profit | |
Reserve and Distribution of Profit | 15. RESERVE AND DISTRIBUTION OF PROFIT In accordance with relevant PRC regulations and the Articles of Association of our PRC subsidiaries, our PRC subsidiaries are required to allocate at least 10% of their annual after-tax profits determined in accordance with PRC statutory financial statements to a statutory general reserve fund until the amounts in said fund reaches 50% of their registered capital. As of December 31, 2020 and 2019, the balance of general reserve was $14.0 million, respectively. Under the applicable PRC regulations, the Company may pay dividends only out of the accumulated profits, if any, determined in accordance with the PRC accounting standards and regulations. As the statutory reserve funds can only be used for specific purposes under the PRC laws and regulations. The general reserves are not distributable as cash dividends. Our after-tax profits or losses with respect to the payment of dividends out of accumulated profits and the annual appropriation of after-tax profits as calculated pursuant to the PRC accounting standards and regulations do not result in significant differences as compared to after-tax earnings as presented in our consolidated financial statements. However, there are certain differences between the PRC accounting standards and regulations and the U.S. generally accepted accounting principles, arising from different treatment of items such as amortization of intangible assets and change in fair value of contingent consideration arising from business combinations. |
Equity
Equity | 12 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
Equity | 16. EQUITY (a) Ordinary shares The Company is authorized to issue 100,000,000 ordinary shares at no par value. In January 2018, 79,834 and 8,333 ordinary shares were issued as a result of exercise of stock options granted to employees and consultants, respectively. As a result, the amount of approximately $626,000 and $24,000, previously charged to additional paid in capital in the periods services were provided were credited to ordinary shares, respectively. In November 2018, the Company issued 166,667 ordinary shares to two individuals including Mr. Lin at a price of $9 per share for a total consideration of $1,500,000. The settlement price was negotiated and resembled the highest trading price of the Company’s stock on November 13, 2018. In October 2019, the Company issued 40,000 restricted shares to a consultant as its service compensation for the service period from October 28, 2019 to October 27, 2020. The fair value of the 40,000 ordinary shares was approximately $110,000, which was determined by the market closing price on the grant date and a discount for lacking of market liquidity. The service compensation of approximately $110,000 is amortized over the service period. In March 2020, the Company issued a total of 285,714 ordinary shares to certain individual investors at $2.1 per share, which generated approximately $576,000 net proceeds for the Company. In the first half of 2020, the Company issued a total of 30,000 ordinary shares as compensation of investor relations service, fair value of which was approximately $144,000 which is amortized over the service period until July 21, 2020. In April 2020, the Company issued 16,667 restricted shares of the ordinary shares to a consultant as its service compensation for the service period from April 2, 2020 to April 1, 2021. The fair value of the 16,667 ordinary shares was approximately $42,000, which is amortized over the service period. In July 2020, the Company issued 42,000 ordinary shares to a consultant as its service compensation for the service period from July 20, 2020 to January 20, 2021. The fair value of the 42,000 ordinary shares was approximately $101,000, which is amortized over the service period In July and September 2020, the Company issued an aggregate of 13,110 ordinary shares to an employee for the individual’s job performance. The fair value of the 13,110 ordinary shares was approximately $65,000, which was determined by the market closing price on the grant date. In September, October, and December, the holders of the promissory note issued in September 2019, and March 2020 converted principal balance of the promissory notes and accrued interests to the Company’s ordinary shares in an aggregate of 1,066,845 shares with no par value of which 299,318 shares converted on December 30, 2020 were not issued until February 2021 (see Note 13). The total amount of principal and accrued interest converted into the ordinary shares as of December 31, 2020 was approximately $1.8 million. In September 2020, the Company issued 16,220 restricted shares to a consultant as a part of finder fees for the financing services. The fair value of the 16,220 ordinary shares was approximately $41,000, which was determined by the market closing price on the grant date and a discount for lacking of market liquidity. (b) Stock-based compensation The following table provides the details of the approximate total share-based payments expense during the year ended December 31, 2020, 2019, and 2018: For the Year Ended December 31, 2020 December 31, 2019 December 31, 2018 Employees and directors share-based payments $ 298,000 (a)(c) $ 494,000 (c) $ 585,000 (c) Stock options issued for services $ 89,000 (d) $ 67,000 (d) $ 44,000 (d) Shares issued for services $ 357,000 (a) 19,000 (a) - $ 744,000 $ 580,000 $ 629,000 (c) Stock options to employees and directors On May 9, 2016, the Board of Directors of the Company adopted the 2016 Equity Incentive Plan, or the 2016 Plan. Pursuant to the 2016 Plan, the Company may offer up to 833,334 million ordinary shares as equity incentives to its directors, employees and consultants. Such number of shares is subject to adjustment in the event of certain reorganizations, mergers, business combinations, recapitalizations, stock splits, stock dividends, or other change in the corporate structure of the Company affecting the issuable shares under the 2016 Plan. The Company accounts for its stock option awards to employees and directors pursuant to the provisions of ASC 718, Compensation – Stock Compensation. The fair value of each option award is estimated on the date of grant using the Black-Scholes Merton valuation model. The Company recognizes the fair value of each option as compensation expense ratably using the straight-line attribution method over the service period, which is generally the vesting period. On May 27, 2016, the Company granted options to purchase an aggregate of 452,000 ordinary shares under the 2016 Plan. The fair value of these options was approximately $1.6 million at the date of the grant, which was fully amortized as of December 31, 2019. Approximately $365,000 and $407,000 was recorded as compensation and included in administrative expenses in the consolidated statements of operations for the services provided for the years ended December 31, 2019 and 2018, respectively. On May 17, 2017, the Company granted options to employees and directors to purchase an aggregate of 160,000 ordinary shares under the 2016 Plan. The fair value of these options was approximately $0.5 million at the date of the grant, which was fully vested and amortized as of December 31, 2020. Approximately $92,000, $129,000 and $178,000 was recorded as compensation and included in administrative expenses in the consolidated statements of operations for the services provided for the year ended December 31, 2020, 2019, and 2018, respectively. On July 24, 2020, the Company granted options to employees and directors to purchase an aggregate of 333,348 ordinary shares under the 2016 Plan. The fair value of these options was approximately $0.3 million at the date of the grant, of which approximately $140,000 was recorded as compensation and included in administrative expenses in the consolidated statements of operations for the services provided for the year ended December 31, 2020. On July 31, 2020, the stock options granted to employees and directors in 2016 and 2017 were fully exercised on a cashless method, with 72,414 ordinary shares issued. Stock option activity for the year ended December 31, 2020, 2019 and 2018 is summarized as follows: Weighted Average Remaining Weighted Contractual Aggregated Options Average Life Intrinsic Outstanding * Exercise Price* (Year) Value Outstanding at January 1, 2018 486,333 $ 6.84 3.40 $ 996,860 Exercised (133,800 ) 7.26 - - Canceled (18,833 ) $ 6.66 - - Outstanding at December 31, 2018 333,700 $ 6.66 2.40 $ 188,790 Exercised - - - - Canceled (36,800 ) $ 6.90 - - Outstanding at December 31, 2019 296,900 $ 6.66 1.4 $ - Granted 333,348 2.4 - - Exercised (294,733 ) 6.66 - - Canceled (9,167 ) $ 3.48 - - Outstanding at December 31, 2020 326,348 2.4 2.6 $ 143,587 Vested and expected to be vested as of December 31, 2020 310,017 2.4 2.6 136,407 Options exercisable as of December 31, 2020 (vested) - - - - There were 333,348 stock options granted to employees during the years ended December 31, 2020. No options were granted to employees during the years ended December 31, 2019 and 2018. The total intrinsic value of stock options exercised during the years ended December 31, 2020 and 2018 was approximately $637,000 and $1,473,000, and there was no option exercised during the year ended December 31, 2019. The Company did not receive any proceeds related to the cashless exercise of stock options from employees for the years ended December 31, 2020, 2019 and 2018. The following table summarizes the status of options which contain vesting provisions: Weighted Average Grant Date Options* Fair Value* Non-vested at January 1, 2020 41,650 $ 3.54 Granted 333,348 $ 1.01 Vested (41,650 ) $ 3.54 Canceled (7,000 ) $ 1.01 Non-vested at December 31, 2020 326,348 $ 1.01 As of December 31, 2020 and 2019, approximately $0.2 million and $0.1 million of total unrecognized compensation expense related to non-vested share options expected to be recognized over a weighted average remaining vesting period of approximately 0.3 year and 0.1 year respectively. The total fair value of options vested during the year ended December 31, 2020, 2019 and 2018 was approximately $0.1 million, $0.6 million and $0.6 million, respectively. To the extent the actual forfeiture rate is different from what the Company has anticipated; stock-based compensation related to these awards will be different from its expectations. *On July 30, 2020, the Company implemented a one-for-six reverse stock split of the Company’s issued and outstanding ordinary shares. Except shares authorized, all share and per share information has been retroactively adjusted to give effect to the reverse stock split for all periods presented, unless otherwise indicated. (d) Stock options and warrants to non-employees Pursuant to the Company’s 2016 Equity Incentive Plan, for the year ended December 31, 2018, the Company issued 33,333 stock options to consultants with 20,833 options vested in 2018 and 12,500 options vested in 2019. The stock options issued to non-employees would be forfeited either three months after the expiration of the service agreement or upon the expiry of contractual life of the options. On February 20, 2019, the Company issued warrants to the Consultant to purchase 25,000 of the Company’s ordinary shares with exercise price at $6.60 per share, which was fully exercised in cashless for 6,250 ordinary shares on July 31, 2020. On April 2, 2020, the Company issued warrants to the Consultant to purchase 16,667 of the Company’s ordinary shares, no par value with an exercise price at $2.52 per share, which was fully exercised in cashless for 11,894 ordinary shares on July 31, 2020. In July 2020, the Company granted options to certain consultants to purchase an aggregate of 57,366 ordinary shares of the Company with an exercise price at $2.64 per share. The options were fully vested at the grant date as a rewarding for the past service of the consultants. Before the adoption of ASU2018-07, the fair value of the options and warrants issued to consultants was estimated on the measurement date using the Black-Scholes Merton valuation model, after the adoption on January 1, 2019, the fair value of the equity awards to consultants was measured on the grant date. The Company expensed to administrative expense approximately $89,000, $67,000 and $44,000 for the years ended December 31, 2020, 2019 and 2018, respectively. As of December 31, 2020, the exercise price for the stock options issued to non-employee for service was $2.64 and remaining life was 2.52 years. The stock options granted to non-employees were expired in three years after the grant date. The following table outlines the options outstanding and exercisable as of December 31, 2020: 2020 Number of Options Outstanding Exercise Expiration and Exercisable Price Date July 2020 stock options granted to certain consultants 57,366 $ 2.64 07/09/2023 Total 57,366 |
Consolidated Segment Data
Consolidated Segment Data | 12 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
Consolidated Segment Data | 17. CONSOLIDATED SEGMENT DATA Segment information is consistent with how management reviews the businesses, makes investing and resource allocation decisions, and assesses operating performance. Transfers and sales between reportable segments, if any, are recorded at cost. All sales occurred in China since our revenue-generating operations are located in China. The Company reports financial and operating information in the following two segments: (a) Cloud-based Technology (CBT) segment — The CBT segment is the Company’s current and future focus for corporate development. It includes the Company’s cloud-based products, high-end data storage servers. and related services sold to private sectors including new media, healthcare, education, and residential community management, and among other industries and applications. In this segment, the Company generates revenues from the sales of hardware and software total solutions with proprietary software and content as well as from designing and developing software products specifically customized for private sector customers’ needs for a fixed price. As a result of COVID-19 pandemic, city lockdowns, travel restrictions, and other preventive measures had negatively impacted on the China out-of-home advertising business and significantly dampened customers’ demand for ads display terminals. Nevertheless, mandatory home stays and work from remote locations triggered a steep surge in on-line gaming, on-line shopping, on-line entertainment, and electronic communication, and created a great demand for high-end data storage servers to accommodate internet information transmission. The Company has stabilized supply chains for the high-end data storage server to meet market demands supplementing the declining revenue from ads display terminals and included the revenue and cost of revenue of high-end data storage servers in the CBT segment. (b) Traditional Information Technology (TIT) segment —The TIT segment includes the Company’s project-based technology products and services. The solutions the Company has sold primarily include Geographic Information Systems (GIS), Digital Public Security Technology (DPST), and Digital Hospital Information Systems (DHIS). In this segment, the Company generates revenues from sales of hardware and system integration services. Selected information by segment is presented in the following tables for the year ended December 31, 2020, 2019, and 2018. 2020 2019 2018 Revenues (1) TIT Segment $ 377,499 $ 241,132 $ 383,420 CBT Segment 10,685,276 13,550,171 20,194,920 $ 11,062,775 $ 13,791,303 $ 20,578,340 (1) 2020 2019 2018 (Loss) income from operations TIT Segment $ (166,727 ) $ (662,556 ) $ (528,891 ) CBT Segment (15,268,750 ) (2,037,151 ) 2,391,930 Corporate and others (2) (1,931,252 ) (1,472,454 ) (1,694,215 ) ( Loss) income from operations (17,366,729 ) (4,172,161 ) 168,824 Corporate other (loss) income, net (22,580 ) 669,755 956,753 Corporate interest income 4,798 133,517 36,381 Corporate interest expense (1,018,013 ) (499,852 ) (484,403 ) (Loss) income before income taxes (18,402,524 ) (3,868,741 ) 677,555 Income tax benefit 71,316 274,480 1,201,231 Net (loss) income (18,331,208 ) (3,594,261 ) 1,878,786 Less: Loss (income) attributable to the non-controlling interest 636,433 11,929 (186,803 ) Net (loss) income attributable to the Company $ (17,694,775 ) $ (3,582,332 ) $ 1,691,983 (2) Non-cash employee compensation by segment for the year ended December 31, 2020, 2019, and 2018 are as follows: 2020 2019 2018 Non-cash employee compensation: Corporate and others 298,091 494,316 584,629 $ 298,091 $ 494,316 $ 584,629 Depreciation and amortization by segment for the year ended December 31, 2020, 2019, and 2018 are as follows: 2020 2019 2018 Depreciation and amortization: TIT Segment $ 19,783 $ 17,278 $ 13,941 CBT Segment 3,459,861 2,883,674 3,660,596 $ 3,479,644 $ 2,900,952 $ 3,674,537 2020 2019 2018 Provisions for allowance for credit losses on accounts receivable, other receivable and advances to suppliers : TIT Segment $ 36,895 $ 344,550 $ (438,378 ) CBT Segment 13,484,287 3,283,994 1,268,644 $ 13,521,182 $ 3,628,544 $ 830,266 2020 2019 2018 Inventory obsolescence provision: TIT Segment $ 10,943 $ 2,366 $ 9,261 CBT Segment (5,318 ) 112,824 21,142 $ 5,625 $ 115,190 $ 30,403 2020 2019 2018 Impairment of long-term investments CBT Segment - - 45,400 $ - $ - $ 45,400 Total assets by segment as at December 31, 2020 and 2019 are as follows: 2020 2019 Total assets TIT Segment $ 213,329 $ 725,088 CBT Segment 30,488,753 39,755,020 Corporate and others 74,569 135,438 $ 30,776,651 $ 40,615,546 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 18. COMMITMENTS AND CONTINGENCIES On December 12, 2018, IST HK entered into a non-exclusive joint venture agreement with Mr. Huang, a permanent resident of Republic of Singapore, to form Asia Taoping PTE. LTD. (“Asia Taoping”) for providing Internet + Sharing New Media Platform service and other business to South East Asia countries. IST HK will own 10% of equity interest of and contributes registered capital approximately $369,000 to Asia Taoping. Capital contribution is made in installment, of which the first installment is to be contributed within 300 days from the execution date of the joint venture agreement. IST HK has not made the first installment of capital contribution to Asia Taoping, which will be incurred pursuant to specific capital needs of Asia Taoing. IST HK provides hardware, software platform, and services to the joint venture. Asia Taoping is a corporate joint venture and IST HK does not exercise significant influence, therefore, the equity investment to Asia Taoping will be accounted for using the measurement alternative under Long-Term Investment. Revenue generated from Sales of hardware and services rendered are accounted for related-party transactions. The Company received a notification from Nasdaq Listing Qualifications on June 18, 2019, as announced in a report with the SEC on a 6-K Form filed on June 19, 2019, that the Company was not in compliance with the minimum bid price requirements set forth in Nasdaq Listing Rule 5550(a)(2) for continued listing on The Nasdaq Capital Market. On July 30, 2020, The Company may from time to time be subject to legal proceedings, investigations, and claims incidental to conduct of our business. The Company is currently subject to a legal proceeding with the bankruptcy receiver (the Receiver) for Shenzhen Kejian Information Technology Co., Ltd. (Kejian). The Receiver was appointed by the bankruptcy court to liquidate Kejian that filed bankruptcy on December 6, 2016. On July 28, 2016, the Company received a payment in the amount of RMB 550,000 (approximately $89,000) from Kejian, which was considered as a preferential payment within 6 months from Kejian’s bankruptcy filing by China bankruptcy laws and requested to return the amount to the Receiver. The Company has anticipated an unfavorable outcome from the lawsuit and accrued a contingent liability of $89,000 for the probable loss. Since the second quarter of 2020, COVID-19 pandemic has been largely contained in China, and only sporadic imported infection cases are reported. Business around China has resumed to normal. The operations of our customers and the supply chains were gradually back to normal, as well. Nevertheless, the COVID-19 pandemic did negatively impact on operational cash flows of most of businesses inclusive of our customers in China’s out-of-home advertising market from the initial lockdown measures, travel restrictions, and gradual recovery in business activities in the second half of the 2020 that result in prolonging our collection of outstanding accounts receivable and additional credit loss provisions. The COVID-19 has had a material adverse impact on our operating results for the year of 2020. With the additional injection of the approximately $13.1 million net proceeds raised in the first quarter of 2021, we believe that we will have sufficient capital to maintain our operations for the next 12 months. With the deployment of Antminers and general-purpose servers in 2021 and beyond, we will acquire additional capital through equity or debt financings. |
Concentrations
Concentrations | 12 Months Ended |
Dec. 31, 2020 | |
Risks and Uncertainties [Abstract] | |
Concentrations | 19. CONCENTRATIONS For the year ended December 31, 2020, 2019 and 2018, no customer accounted for greater than 10% of revenue. For the year ended December 31, 2020, 2019, and 2018, the Company’s top five customers accounted for 25%, 24% and 23% of the Company’s revenues, respectively. The Company’s top five accounts receivable accounted for 25% and 20% of accounts receivable as of December 31, 2020 and 2019, respectively. No customer each accounted for greater than 10% or more of accounts receivable as of December 31, 2020 and 2019. For the year ended December 31, 2020, 2019 and 2018, approximately 62%, 97% and 89%, respectively, of total inventory purchases were from five unrelated suppliers. Three suppliers each accounted for greater than 10% of total inventory purchases in 2020, two suppliers each accounted for greater than 10% of total inventory purchases in 2019 and 2018. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | 20. SUBSEQUENT EVENTS Private Placements in 2021 During the first quarter of 2021, the Company entered into several securities purchase agreements with certain investors to sell an aggregate of 3,140,740 ordinary shares, no par value, with total proceeds of approximately $13.1 million before deducting offering expenses. The Company intends to use the net proceeds from the financing for working capital and general corporate purposes. Strategic Partnership in 2021 On January 26, 2021, the Company entered into a strategic partnership agreement with Ivy International Education Technology Co., Ltd. (“Ivy International Education”) to develop and market new learning programs for quality education. In February, Biznest and Ivy International Education formed a joint venture company, Shenzhen Taoping Education Technology Co., Ltd., 51% equity interests of which owned by Biznest. On March 22, 2021, the Company entered into a strategic cooperation agreement with BitFuFu.com (“BitFuFu”). to purchase blockchain cloud computing service with a total value of $10 million from BitFuFu within three years. The first batch of $1 million service subscription is from March 18, 2021 to March 13, 2022. By purchasing the blockchain cloud computing service, TAOP will be able to start Bitcoin mining through Antminer, which is expected to bring direct revenues for the Company. On March 29, 2021, the Company entered into a strategic cooperation framework agreement with Shanghai Guanghua Education Investment Management Co., Ltd. (“Shanghai Guanghua Education”) and Wuhu Sasan Education Management Co., Ltd. (“Wuhu Sasan”), a majority-owned subsidiary of Shanghai Guanghua Education for a term of three years to promote on-line education programs. As a part of the agreement, TAOP and Wuhu Sasan formed a joint venture company, Wuhu Taoping Education Technology Co., Ltd., in March, 2021. Biznest and Wuhu Sasan owns 51 percent and 49 percent equity interests in the joint venture, respectively. On April 13, 2021, the Company entered into exclusive strategic cooperation and joint operation agreement with Ordos Blockchain Cloud Computing Technology Co., Ltd. to jointly establish and operate a GPU cloud computing power trading platform to provide Taoping’s smart cloud services: cloud desktop, cloud rendering, cloud gaming, digital assets and other blockchain applications. Both parties will jointly build and operate a GPU cloud (“Taoping G Cloud”) computing power trading platform. Issuance of Restricted Shares and Warrants for Services in 2021 On February 19, 2021, the Company entered into a consulting agreement with Great Bay Capital Investment Limited (“Great Bay”) for a two-year term effective February 19, 2021. Great Bay will provide consulting services to assist the Company in blockchain and digital investment and M&A opportunities. The Company agreed to issue to Great Bay a warrant for the purchase of 1,000,000 ordinary shares of the Company with no par value, exercisable at $3.50 per share (subject to adjustment) at any time prior to the 181st calendar day after the date of issuance. The warrant can only be exercised in cash. On April 16, 2021, the Company entered into two one-year term consulting agreements with Shenzhen Jinfuze Industrial Co., Ltd. (“Jinzefu”) and Shanjing Capital Group Co., Ltd. (“Shanjing Capital”). Jinzefu will mainly advise the Company on the financing activities. Shanjing Capital will advise the Company on the supply chain related activities. The Company agreed to issue each of the consultants warrants to purchase 450,000 ordinary shares of the Company with no par value, exercisable at $6.30 per share (subject to adjustment) at any time prior to the 12-month anniversary after the date of issuance. The warrants may only be exercised in cash. Acquisitions in 2021 On March 19, 2021, the Company entered into a share purchase agreement to acquire 100% equity interest in Taoping New Media Co., Ltd. (“Taoping New Media”). After the closing of the transaction, Taoping New Media will become a wholly owned subsidiary of Biznest Internet Technology Co., Ltd., a variable interest entity of TAOP. Taoping New Media is a leading media operator in China’s out-of-home digital advertising industry. It has purchased smart display screens from TAOP since 2017 and built up its digital advertising network based on TAOP’s cloud platform. Mr. Jianghuai Lin, the Chairman and CEO of TAOP, who owns approximately 24.6% of TAOP, also owns approximately 51% of Taoping New Media. After the acquisition, Taoping New Media business is expected to be part of TAOP’s newly created Digital Culture Business Division, and TAOP will capture advertising revenue streams from Taoping network. Pursuant to the share purchase agreement, as consideration of the purchase, TAOP has agreed to issue to the shareholders of Taoping New Media a total of 1,213,630 ordinary shares of TAOP, equivalent to $10.24 million, based on the financial position, advantages of its technology and nation-wide sales net-work in China, and growth potential of the target company. Mr. Lin, as the majority shareholder of Taoping New Media, will receive 614,369 ordinary shares. The closing of the transaction is subject to a number of conditions, including, without limitation, completion of all respective internal approval procedures of the parties, no material adverse impact on the assets, operation and management team of Taoping New Media prior to closing, and the satisfaction or waiver of other customary closing conditions. The parties intend to close the transaction no later than May 10, 2021. Both the board of directors of TAOP and the audit committee of board approved the transaction based on a written opinion rendered by Albeck Financial Services, the independent financial advisor to the board, to the effect that, as of the date of such opinion, the consideration in the transaction is fair to TAOP and TAOP’s shareholders, from a financial point of view. The Company is in the process of finalizing purchase accounting. The acquisition is not considered as acquisition of entity under common control. The Company will engage an independent valuation firm to assist with the allocation of the purchase price of Taoping New Media which is not yet final. TAOP will disclose the item(s) that still remain outstanding in accordance with the requirement contained in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 805, “Business Combinations”. On March 31, 2021 the Company entered into a share purchase agreement with Genie Global Limited. (“Genie Global”) to acquire 51% equity interest in Genie Global’s wholly owned subsidiary, Render Lake Tech Ltd. (“Render Lake”). Founded in Ontario, Canada in 2019, Render Lake is a cloud infrastructure service provider committed to provide high-performance cloud computing solutions for special effects companies. Through its network of Trusted Partner Network (TPN)-compliant data centers, Render Lake provides comprehensive cloud solutions and develops cloud desktop, cloud rendering, cloud computing, NFT (Non-Fungible Token), and cloud gaming businesses. The acquisition of Render Lake is important to strategically provide TAOP great opportunities in cloud desktop, cloud computing, and cloud gaming business in the 5G era. Also, cloud rendering and NFT can provide powerful technical support for TAOP’s new media, smart cloud, and online education platform businesses. Others in 2021 On April 21, 2021, the Company established a wholly-owned Hong Kong subsidiary, Taoping Capital Limited (“Taoping Capital”), to provide capital support for the growth of TAOP’s blockchain and digital asset business and the Company’s cloud desktop, cloud rendering and cloud gaming business. Most of the funds provided by Taoping Capital will be invested in TAOP projects for the purchase of bitcoin mining machines and general-purpose servers suitable for Ethereum and cloud desktops. At the same time, Taoping Capital will support the Company with operation management consulting. Taoping Capital will also actively seek investment opportunities in the blockchain industry. On April 15, 2021, the Company signed a Bitcoin mining machine purchase agreement (the “Purchase Agreement”) with Bitmain Technologies Limited. Pursuant to the Purchase Agreement, TAOP will purchase Antminer S19j Pro Bitcoin mining machines with a total order value of about $24 million. The purchase will be funded by a line of credit collateralized by the Company’s properties and secured by the personal real estate holding of Mr. Jianghuai Lin, the Chairman and CEO of TAOP. The miners are scheduled to deliver starting from August 2021. Upon the completion of deliveries under the Purchase Agreement, TAOP is expected to own an additional hash rate of approximately 300,000 TH/s. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Principles of Consolidation | (a) Basis of Presentation and Principles of Consolidation The consolidated financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles. The consolidated financial statements include the accounts of the Company, its subsidiaries, and its VIE and VIE subsidiaries for which the Company is the primary beneficiary. All significant intercompany accounts and transactions have been eliminated in consolidation. Reverse Stock Split: A one (1)-for-six (6) reverse stock split of the Company’s issued and outstanding ordinary shares was effective on July 30, 2020 (the “Reverse Stock Split”). Except shares authorized, all share and per share information has been retroactively adjusted to give effect to the Reverse Stock Split for all periods presented, unless otherwise indicated. |
Use of Estimates | (b) Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. The Company’s significant estimates include its accounts receivable, fair value of stock options and warrants, valuation allowance of deferred tax assets, and other intangible assets. Management makes these estimates using the best information available at the time the estimates are made; however actual results could differ from those estimates. |
Economic, Pandemic, and Political Risks | (c) Economic, pandemic, and Political Risks All the Company’s revenue-generating operations are conducted in the PRC. Accordingly, the Company’s business, financial condition and results of operations may be influenced by the political, economic, public health, and legal environments in the PRC, and by the general state of the PRC economy. The Company’s operations in the PRC are subject to special considerations and significant risks that are not typically pertaining to the companies in North America and Western Europe. These include risks associated with, among others, the political, economic, public health, and legal environments and foreign currency exchange. The Company’s financial results may be adversely affected by changes in the political, public health, and social conditions in the PRC, and by changes in governmental policies with respect to laws and regulations, fiscal and monetary policies, anti-inflationary measures, currency conversion, remittances abroad, and rates and methods of taxation. |
Cash and Cash Equivalents | (d) Cash and Cash Equivalents The Company considers all highly liquid investments purchased and cash deposits with financial institutions with original maturities of three months or less to be cash equivalents. The Company had no cash equivalents as of December 31, 2020 or 2019. The Company maintains its cash accounts at credit worthy financial institutions and closely monitors the movements of its cash positions. As of December 31, 2020 and 2019, approximately $0.9 million and $1.5 million of cash, respectively, was held in bank accounts in the PRC. |
Restricted Cash | (e) Restricted Cash The Company also held restricted cash of $0.2 million as of December 31, 2020. The restricted fund is a time deposit served as collateral to secure a bank loan facility that matures on May 7, 2021. |
Accounts Receivable, Accounts Receivable -related Parties, and Concentration of Risk | (f) Accounts Receivable, Accounts Receivable –related parties, and Concentration of Risk In January 2020, the Company adopted ASU 2016-13, Topics 326-Credit Loss, Measurement of Credit Losses on Financial Instruments, which replaces the incurred loss methodology with an expected loss methodology that is referred to as the current expected credit loss (CECL) methodology, as its accounting standard for its trade accounts receivable. The adoption of the credit loss accounting standard has no material impact on the Company’s consolidated financial statements as of January 1, 2020. Accounts receivable are recognized and carried at carrying amount less an allowance for credit loss, if any. The Company maintains an allowance for credit losses resulting from the inability of its customers to make required payments based on contractual terms. The Company reviews the collectability of its receivables on a regular and ongoing basis. The Company has also included in calculation of allowance for credit losses, the potential impact of the COVID-19 pandemic on our customers businesses and their ability to pay their accounts receivable. After all attempts to collect a receivable have failed, the receivable is written off against the allowance. The Company also considers external factors to the specific customer, including current conditions and forecasts of economic conditions, including the potential impact of the COVID-19 pandemic. In the event the Company recovers amounts previously reserved for, the Company will reduce the specific allowance for credit losses. The balance of allowance for credit loss for the year ended December 31, 2020 has increased approximately $14.0 million from the year ended December 31, 2019. The Company evaluates the creditworthiness of all of its customers individually before accepting them and continuously monitors the recoverability of accounts receivable. If there are any indicators that a customer may not make payment, the Company may consider making provision for non-collectability for that particular customer. At the same time, the Company may cease further sales or services to such customer. The following are some of the factors that the Company considers in determining whether to discontinue sales, record as contra revenue or allowance for credit losses: ● the customer fails to comply with its payment schedule; ● the customer is in serious financial difficulty; ● a significant dispute with the customer has occurred regarding job progress or other matters; ● the customer breaches any of the contractual obligations; ● the customer appears to be financially distressed due to economic or legal factors; ● the business between the customer and the Company is not active; and ● other objective evidence indicates non-collectability of the accounts receivable. The Company considers the following factors when determining whether to permit a longer payment period or provide other concessions to customers: ● the customer’s past payment history; ● the customer’s general risk profile, including factors such as the customer’s size, age, and public or private status; ● macroeconomic conditions that may affect a customer’s ability to pay; and ● the relative importance of the customer relationship to the Company’s business. Accounts receivable as at December 31, 2020 and 2019 are as follows: December 31, 2020 December 31, 2019 Accounts Receivable $ 12,359,619 $ 9,611,788 Allowance for credit losses (8,095,362 ) (4,685,707 ) Accounts Receivable, net $ 4,264,257 $ 4,926,081 Accounts Receivable - related parties $ 12,017,651 $ 10,862,238 Allowance for credit losses (9,098,436 ) (2,128,975 ) Accounts Receivable - related parties, net $ 2,919,215 $ 8,733,263 Non-current Accounts Receivable $ 3,013,532 $ 1,804,189 Non-current credit losses (1,174,302 ) (156,080 ) Non-current Accounts Receivable, net $ 1,839,230 $ 1,648,109 Non-current Accounts Receivable - related parties $ 4,172,502 $ 4,035,831 Non-current Allowance for credit losses - related parties (2,849,306 ) (241,882 ) Non-current Accounts Receivable - related parties, net $ 1,323,196 $ 3,793,949 The normal credit term is ranging from 1 month to 3 months after the customers’ acceptance of hardware or software, and completion of services. However, because of various factors of business cycle, the actual collection of outstanding accounts receivable may be beyond the normal credit terms. In accordance with ASC 210-10-45, the non-current accounts receivable and non-current accounts receivable-related parties represent the amounts that the Company does not reasonably expect to be realized during the normal operating cycle of the Company. Considering the limited operating history with the customers and Taoping Alliance members, in accordance with ASC 210-10-45, the operating cycle of the Company is not identifiable. Therefore, the Company uses one-year time period as the basis for the separation of current and non-current assets. The allowance for credit losses at December 31, 2020 and 2019, totaled approximately $21.2 million and $7.2 million, respectively, representing management’s best estimate. The following table describes the movements for allowance for credit losses during the years ended December 31, 2020 and 2019. Balance at January 1, 2019 $ 3,683,842 Increase in allowance for credit losses 3,576,669 Foreign exchange difference (47,867 ) Balance at December 31, 2019 $ 7,212,644 Increase in allowance for credit losses 13,528,638 Foreign exchange difference 476,124 Balance at December 31, 2020 $ 21,217,406 |
Advances to Suppliers | (g) Advances to Suppliers Advances to suppliers represent cash deposits for the purchase of inventory items including but not limited to super-computing server machines from suppliers. |
Advances from Customers and Related Parties | (h) Advances from Customers and Related Parties Advances from customers and related parties represent cash received from customers and related parties as advance payments for the purchases of the Company’s products and services. |
Fair Value and Fair Value Measurement of Financial Instruments | (i) Fair Value and Fair Value Measurement of Financial Instruments Management has estimated that carrying amounts reported in the consolidated balance sheets for cash, accounts receivable, accounts receivable – related party, advances to suppliers, loan receivable - related party, other current assets, accounts payable, other payables and accrued expenses, income taxes payable, convertible note payable, net, and due to related parties approximate their fair market value based on the short-term maturity of these instruments. |
Fair Value Accounting | (j) Fair Value Accounting Financial Accounting Standards Board (FASB) Accounting Standards Codifications (ASC) 820-10 “Fair Value Measurements and Disclosures”, establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). As required by FASB ASC 820-10, assets are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The three levels of the fair value hierarchy under FASB ASC 820-10 are described below: Level 1 Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; Level 2 Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability; and Level 3 Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity). On January 1, 2020, the Company adopted ASU 2018-13,” Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement.” The adoption of the disclosure requirements for Fair Value Accounting has no material impact on the Company’s consolidated financial statements. |
Inventories, Net | (k) Inventories, net Inventories are valued at the lower of cost (weighted average basis) or net realizable value. Net realizable value is the expected selling price in the ordinary course of business minus any costs of completion, disposal, and transportation to make the sale. The Company performs an analysis of slow-moving or obsolete inventory periodically and any necessary valuation reserves, which could potentially be significant, are included in the period in which the evaluations are completed. Any inventory impairment results in a new cost basis for accounting purposes. |
Property, Equipment and Software, Net | (l) Property, equipment and software, net Property, equipment and software are stated at cost less accumulated amortization and depreciation. Amortization and depreciation is provided over the assets’ estimated useful lives, using the straight-line method. Estimated useful lives of property, equipment and software are as follows: Office buildings 20-50 years Plant and machinery 3-20 years Electronics equipment, furniture and fixtures 3-5 years Motor vehicles 5 years Purchased software 5 years Maintenance and repairs costs are expensed as incurred, whereas significant renewals and betterments are capitalized. |
Intangible Assets, Net | (m) Intangible assets, net Intangible assets represent technology, and software development costs and trademarks acquired by the Company through business acquisition. Intangible assets are stated at acquisition fair value or cost less accumulated amortization, and amortized using the straight-line method over the following estimated useful lives: Software development costs 3-5 years Trademarks 5 years |
Long-term Investment | (n) Long-term investment. The Company’s long-term investment consists of equity investments without readily determinable fair value. The Company adopted ASU No. 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities (“ASU 2016-01”), codified in ASC Topic 321, Investments—Equity Securities (“ASC 321”), from January 1, 2018. Pursuant to ASC 321, equity investments, except for those accounted for under the equity method, those that result in consolidation of the investee and certain other investments, are measured at fair value, and any changes in fair value are recognized in earnings. For equity securities without readily determinable fair value and do not qualify for the existing practical expedient in ASC Topic 820, Fair Value Measurements and Disclosures (“ASC 820”) to estimate fair value using the net asset value per share (or its equivalent) of the investment, the Company elected to use the measurement alternative to measure those investments at cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer, if any. Significant judgments are required to determine (i) whether observable price changes are orderly transactions and identical or similar to an investment held by the Company; and (ii) the selection of appropriate valuation methodologies and underlying assumptions, including expected volatility and the probability of exit events as it relates to liquidation and redemption features used to measure the price adjustments for the difference in rights and obligations between instruments. For equity investments that the Company elects to use the measurement alternative, the Company makes a qualitative assessment considering impairment indicators to evaluate whether investments are impaired at each reporting date. Impairment indicators considered include, but are not limited to, a significant deterioration in the earnings performance or business prospects of the investee, including factors that raise significant concerns about the investee’s ability to continue as a going concern, a significant adverse change in the regulatory, economic, or technologic environment of the investee and a significant adverse change in the general market condition of either the geographical area or the industry in which the investee operates. If a qualitative assessment indicates that the investment is impaired, the entity has to estimate the investment’s fair value in accordance with the principles of ASC 820. If the fair value is less than the investment’s carrying value, the Company recognizes an impairment loss in net income equal to the difference between the carrying value and fair value. |
Convertible Promissory Note | (o) Convertible promissory note The Company determines the appropriate accounting treatment of its convertible debts in accordance with the terms in relation to conversion features. After considering the impact of such features, the Company may account for such instrument as a liability in its entirety, or separate the instrument into debt and equity components following the guidance described under ASC 815 Derivatives and Hedging and ASC 470 Debt. The debt discount, if any, together with related issuance cost are subsequently amortized as interest expense over the period from the issuance date to the earliest conversion date or stated redemption date. The Company presented the issuance cost of debt in the balance sheet as a direct deduction from the related debt. |
Impairment of Long-lived Assets | (p) Impairment of Long-Lived Assets Long-lived assets held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of assets may not be recoverable. It is reasonably possible that these assets could become impaired as a result of technology or other industry changes. Recoverability of assets to be held and used is determined by comparing their carrying amount with their expected future net undiscounted future cash flows from the assets. If such assets are considered to be impaired, the impairment to be recognized is measured by how much the carrying amount exceeds the fair value of the assets. There were no impairment charges for the years ended December 31, 2020, 2019 and 2018. Assets held for disposal, if any, are reported at the lower of the carrying amount or fair value less costs to sell. |
Revenue Recognition | (q) Revenue Recognition Beginning January 1, 2018, the Company has adopted the ASU 2014-09, Topic 606, “Revenue from Contracts with Customers” and its related amendments (collectively referred to as “ASC 606”) as its new revenue recognition accounting policy that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. The adoption of the new revenue recognition standard has no material impact on the Company’s consolidated financial statements for any periods prior to 2018. Therefore prior period amounts are not adjusted. The Company generates its revenues primarily from three sources: (1) product sales, (2) software sales, and (3) other sales. Revenue is recognized when obligations under the terms of a contract with our customers are satisfied; and generally occurs upon delivery of the goods and services. Revenue-Products Product revenues are generated primarily from the sale of Cloud-Application-Terminal based digital ads display terminals with integrated software essential to the functionality of the hardware to our customers (inclusive of related parties) and high-end data storage servers. Although manufacturing of the hardware has been outsourced to the Company’s Original Equipment Manufacturer (OEM) suppliers, the Company has acted as the principal of the contract. The Company recognized the hardware sales at the point of delivery. The Company has indicated that it may from time to time provide future unspecified software upgrades to the hardware products’ essential software, which is expected to be infrequent and, free of charge. Non-software service is mainly the one-time training session provided to the customer to familiarize them with the software operation upon the customer’s initial introduction to the software platform. The costs of providing infrequent software upgrade and training provided to the customer for familiarizing the software operations are de minimis. As a result, the Company does not allocate transaction price to software upgrade and customer training. Product sales are classified as “Revenue-Products” on the Company’s consolidated statements of operations. Revenue-Software Customers in the private sector contract the Company to design and develop software products specifically customized for their needs for a fixed price. Software development projects usually include developing software, integrating various isolated software systems into one, and testing the system. The design and build services, together with the integration of the various elements, are generally determined to be essential to the functionality of the delivered software. The contracted price is usually paid in installments based on progression of the project or at the delivery of the software. The Company usually provides non-software services including after-sale support, technical training. The technical training only occurs at the introduction of the software. The software is highly specialized and stable, after-sale support and subsequent upgrade or enhancement are infrequent. The Company has estimated the costs associated with the non-software performance obligations and concludes that these obligations are de minimis to the overall contract. Therefore, the Company does not further allocate transaction price. The Company usually completes the customized software contracts less than 12 months and recognizes the revenue at the point of delivery because the Company does not have an enforceable right to payment for performance completed to date. Revenues from software development contracts are classified as “Revenue-Software” on the Company’s consolidated statements of operations. Revenue-Other The Company also reports other revenue which comprises revenue generates from System upgrade and technical support services, platform service fee, advertising revenue, and rental income. System upgrade and technical support revenue is recognized when performance obligations are satisfied upon completion of the services. Platform service fee is charged based on number of the display terminals used by the customers or a percentage of advertising revenue generated by the display terminals. Platform service revenue is recognized on a monthly basis over the contract period. The Company recognizes new media advertising revenue upon transferring services for delivering the advertisements as contracted with customers, who rent advertising slots on vehicular display terminals for an agreed upon transaction price. New media advertising revenue is recognized over period of time. On January 1, 2019, the Company adopted ASC 842 – Leases that requires lessor to identify the underlying assets and allocate rental income among considerations in lease and non-lease components. Upon adoption, the Company will recognize a lease liability and corresponding right-to-use asset based on the present value of minimum lease payments. The effects on the results of operations are not expected to be significant, as recognition and measurement of expenses and cash flows for leases will be substantially the same under the new standard. Therefore, prior period amounts are not adjusted. The Company owns two units of office space renting out to a third party and a related party under non-cancelable operating lease agreements with lease terms of six years starting from May 1, 2016 and three years starting from July 1, 2019, respectively. The lease agreements have fixed monthly rental payments, and no non-lease component or option for lessees to purchase the underlying assets. The Company collects monthly rental payments from the lessees, and has generated approximately $405,000 and $420,000 rental income for the years ended December 31, 2020, and 2019, respectively. Annual minimum lease payments to be received in the next 5 years: 2021 378,940 2022 136,452 Total 515,392 Contract balances The Company records advances from customers when cash payments are received or due in advance of our performance. For the year ended December 31, 2020, 2019 and 2018, the Company recognized revenue of approximately $256,000, $335,000 and $1,290,000, respectively, that was included in the advances from customers balance at the beginning of each reporting period. Practical expedients and exemptions The Company generally expenses sales commissions if any incurred because the amortization period would have been one year or less. In many cases, the Company is approached by customers for customizing software products for their specific needs without incurring significant selling expenses. The Company does not disclose the value of unsatisfied performance obligations for contracts with an original expected length of one year or less. |
Treasury Stock | (r) Treasury Stock The Company repurchases its ordinary shares from time to time in the open market and holds such shares as treasury stock. The Company applies the “cost method” and presents the cost to repurchase such shares as a reduction in equity. |
Stock-based Compensation | (s) Stock-based compensation The Company applies ASC No. 718, “Compensation-Stock Compensation”, which requires that share-based payment transactions with employees, such as share options, be measured based on the grant date fair value of the equity instrument and recognized as compensation expense over the requisite service period, with a corresponding addition to equity. Under this method, compensation cost related to employee share options or similar equity instruments is measured at the grant date based on the fair value of the award and is recognized over the period during which an employee is required to provide service in exchange for the award, which generally is the vesting period. The Company adopted ASU 2018-07, Compensation-Stock Compensation (Topic: 718): Improvements to Nonemployee Share-Based Payment Accounting on January 1, 2019, to account for stock-based compensation to goods and services provided by the third parties. The fair value of the equity awards to nonemployee are measured on the grant day. Under this guidance, compensation cost related to nonemployee share options or similar equity instruments is recognized in the same period and in the same manner (i.e. capitalize or expense) the entity would if it paid cash for the goods or services. The Company’s adoption of ASU 2018-07 has no material impact to the Company’s consolidated financial statements, nor requirement for cumulative adjustment in retained earnings or other components of equity or net assets. During the year ended December 31, 2020, 2019, and 2018, the Company recognized approximately $744,000, $580,000 and $629,000, respectively, of stock-based compensation expense. |
Foreign Currency Translation | (t) Foreign Currency Translation The functional currency of the US and BVI companies is the United States dollar. The functional currency of the Company’s Hong Kong subsidiaries is the Hong Kong dollar. The functional currency of the Company’s wholly-owned PRC subsidiaries and its VIE is the Chinese Renminbi Yuan, (“RMB”). RMB is not freely convertible into foreign currencies. The Company’s PRC subsidiaries’ and their VIE’s financial statements are maintained in the functional currency. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency at rates of exchange prevailing at the balance sheet date. Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transactions. Exchange gains or losses arising from foreign currency transactions are included in the determination of net loss for the respective periods. For financial reporting purposes, the financial statements of the Company have been translated into United States dollars. Assets and liabilities are translated at exchange rates at the balance sheet dates, revenue and expenses are translated at average exchange rates, and equity is translated at historical exchange rates. Any resulting translation adjustments are not included in determining net income but are included in other comprehensive loss, a component of equity. The exchange rates adopted are as follows: December 31, 2020 December 31, 2019 Year-end RMB to US$ exchange rate 6.5377 6.9692 Average yearly RMB to US$ exchange rate 6.9044 6.9072 The average yearly RMB to US$ exchange rate adopted for the year ended December 31, 2018 was 6.8787. No representation is made that the RMB amounts could have been, or could be, converted into United States dollars at the rates used in translation. |
Research & Development Expenses | (u) Research & Development Expenses The Company follows the guidance in FASB ASC 985-20, Cost of Software to Be Sold, Leased or Marketed, regarding software development costs to be sold, leased, or otherwise marketed. FASB ASC 985-20-25 requires research and development costs for software development to be expensed as incurred until the software model is technologically feasible. Technological feasibility is established when the enterprise has completed all planning, designing, coding, testing, and identification of risks activities necessary to establish that the product can be produced to meet its design specifications, features, functions, technical performance requirements. A certain amount of judgment and estimation is required to assess when technological feasibility is established, as well as the ongoing assessment of the recoverability of capitalized costs. The Company’s products reach technological feasibility shortly before the products are released and sold to the public. Therefore research and development costs are generally expensed as incurred. |
Subsidy Income | (v) Subsidy Income Subsidy income mainly represents income received from various local governmental agencies in China for developing high technology products in the fields designated by the government as new and highly innovative. The Company has no continuing obligation under the subsidy provision. The Company recognizes subsidy income upon receipt of official grant notice from local government authorities. |
Sales, Use, Other Value-added Taxes, and Income Taxes | (w) Sales, use, other value-added taxes, and income taxes Revenue is recorded net of applicable sales, use, and value-added taxes. Income taxes are provided on an asset and liability approach for financial accounting and reporting of income taxes. Deferred income taxes are recognized for all significant temporary differences at enacted rates and classified as non-current in the financial statements. A valuation allowance is provided to reduce the amount of deferred tax assets if it is considered more likely than not that some portion, or all of, the deferred tax assets will not be realized. The Company classifies interest and/or penalties related to unrecognized tax benefits, if any, as a component of income tax expense. The Company applies the provisions of ASC No. 740 “Income Taxes” (“ASC 740”), which clarifies the accounting for uncertainty in income taxes recognized by prescribing a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC 740 also provides accounting guidance on de-recognition, classification, interest and penalties, and disclosure. |
Discontinued Operations | (x) Discontinued Operations The Company follows “ASU 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity” for reporting discontinued operations. Under the revised standard, a discontinued operation must represent a strategic shift that has or will have a major effect on an entity’s operations and financial results. Examples could include a disposal of a major line of business, a major geographical area, a major equity method investment, or other major parts of an entity. The revised standard also allows an entity to have certain continuing cash flows or involvement with the component after the disposal. Additionally, the standard requires expanded disclosures about discontinued operations that will provide financial statement users with more information about the assets, liabilities, income, and expenses of discontinued operations. |
Segment Reporting | (y) Segment reporting Segment information is consistent with how management reviews the businesses, makes investing and resource allocation decisions and assesses operating performance. Transfers and sales between reportable segments, if any, are recorded at cost. ASC 280, Disclosures about Segments of an Enterprise and Related Information establishes standards for reporting information about operating segments. Operating segments are defined as components of an enterprise which engage in business activities from which they may earn revenues and incur expenses, and about which separate financial information is available that is evaluated regularly by the chief operating decision-maker, or decision-making group, in deciding how to allocate resources and in assessing performance. Reportable segments are defined as an operating segment that either (a) exceeds 10% of revenue, or (b) reported profit or loss in absolute amount exceeds 10% of profit of all operating segments that did not report a loss or (c) exceeds 10% of the combined assets of all operating segments. The Company report financial and operational information in the following two segments: (1) Cloud-based Technology (CBT) segment — The CBT segment is our current and future focus of corporate development. It includes the Company’s cloud-based products, high-end data storage servers. and related services sold to private sectors including new media, healthcare, education, and residential community management, and among other industries and applications. In this segment, the Company generates revenues from the sales of hardware and software total solutions with proprietary software and content as well as from designing and developing software products specifically customized for private sector customers’ needs for a fixed price. As a result of COVID-19 pandemic, city lockdowns, travel restrictions, and other preventive measures had negatively impacted on the China out-of-home advertising business and significantly dampened customers’ demand for ads display terminals. Nevertheless, mandatory home stays and work from remote locations triggered a steep surge in on-line gaming, on-line shopping, on-line entertainment, and electronic communication, and created a great demand for high-end data storage servers to accommodate internet information transmission. The Company has stabilized supply chains for the high-end data storage server to meet market demands supplementing the declining revenue from ads display terminals and included the revenue and cost of revenue of high-end data storage servers in the CBT segment. (2) Traditional Information Technology (TIT) segment — The TIT segment includes our project-based technology products and services, including Digital Public Security Technology (DPST) and Multi-screen Digital Display Systems (MDDS). In this segment, we generate revenues from the sales of software and systems integration services. |
Reclassifications | (z) Reclassifications Certain prior period amounts have been reclassified to be comparable to the current period presentation. This reclassification has no effect on previously reported net assets or net income (loss). |
Recent Accounting Pronouncements | (y) Recent Accounting Pronouncements In January 2020, the FASB issued ASU No. 2020-01, Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815)—Clarifying the Interactions between Topic 321, Topic 323, and Topic 815 (a consensus of the FASB Emerging Issues Task Force)(“ASU 2020-01”), which clarifies the interactions of the accounting for certain equity securities under ASC 321, investments accounted for under the equity method of accounting in ASC 323, and the accounting for certain forward contracts and purchased options accounted for under ASC 815. ASU 2020-01 could change how an entity accounts for (i) an equity security under the measurement alternative and (ii) a forward contract or purchased option to purchase securities that, upon settlement of the forward contract or exercise of the purchased option, would be accounted for under the equity method of accounting or the fair value option in accordance with ASC 825. These amendments improve current U.S. GAAP by reducing diversity in practice and increasing comparability of the accounting for these interactions. The new guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 31, 2020. Early adoption is permitted. The Company is currently in the process of evaluating the of adopting ASU 2020-01 on its consolidated financial statements and related disclosure. In August 2020, the FASB issued ASU No. 2020-06 (“ASU 2020-06”) “Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity.” ASU 2020-06 will simplify the accounting for convertible instruments by reducing the number of accounting models for convertible debt instruments and convertible preferred stock. Limiting the accounting models results in fewer embedded conversion features being separately recognized from the host contract as compared with current GAAP. Convertible instruments that continue to be subject to separation models are (1) those with embedded conversion features that are not clearly and closely related to the host contract, that meet the definition of a derivative, and that do not qualify for a scope exception from derivative accounting and (2) convertible debt instruments issued with substantial premiums for which the premiums are recorded as paid-in capital. ASU 2020-06 also amends the guidance for the derivatives scope exception for contracts in an entity’s own equity to reduce form-over-substance-based accounting conclusions and is effective for public business entities fiscal years beginning after December 15, 2021, and interim periods within those fiscal years. The Company is currently evaluating the effect of the adoption of ASU 2020-06 on the consolidated financial statements. The effect will largely depend on the composition and terms of the financial instruments at the time of adoption. In January 2021, the FASB issued ASU No. 2021-01 (“ASU 2021-01”) “Reference Rate Reform (Topics 848). ASU 2021 -01 clarifies that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivative instruments that use an interest rate for margining, discounting, or contract price alignment that is modified as a result of reference rate reform. Amendments in this Update to the expedients and exceptions in Topic 848 capture the incremental consequences of the scope clarification and tailor the existing guidance to derivative instruments affected by the discounting transition. ASU 2021-01 is effective immediately for all entities. Adoption of ASU 2021-01 is not expected to have material impact on the consolidated financial statements. The Company has considered all other recently issued accounting pronouncements and does not believe that the adoption of such pronouncements will have a material impact on the consolidated financial statements. |
Organization, Principal Activ_2
Organization, Principal Activities and Management's Plans (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Subsidiaries and Variable Interest Entity | December 31, December 31, December 31, Subsidiaries/ 2020 2019 2018 Entities VIE % owned % owned % owned Location Taoping Inc. British Virgin Islands Taoping Holdings Limited (THL) Subsidiary 100 % 100 % 100 % British Virgin Islands Information Security Tech. International Co., Ltd. (IST HK) Subsidiary 100 % 100 % 100 % Hong Kong, China Information Security Tech. (China) Co., Ltd. (IST) Subsidiary 100 % 100 % 100 % Shenzhen, China TopCloud Software (China) Co., Ltd. (TopCloud) Subsidiary 100 % 100 % 100 % Shenzhen, China Information Security IoT Tech. Co., Ltd. (ISIOT) Subsidiary 100 % 100 % 100 % Shenzhen, China iASPEC Technology Group Co., Ltd. (iASPEC) VIE 100 % 100 % 100 % Shenzhen, China Biznest Internet Tech. Co., Ltd. (Biznest) VIE 100 % 100 % 100 % Shenzhen, China iASPEC Bocom IoT Tech. Co., Ltd. (Bocom) VIE 100 % 100 % 100 % Shenzhen, China |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Schedule of Accounts Receivable | Accounts receivable as at December 31, 2020 and 2019 are as follows: December 31, 2020 December 31, 2019 Accounts Receivable $ 12,359,619 $ 9,611,788 Allowance for credit losses (8,095,362 ) (4,685,707 ) Accounts Receivable, net $ 4,264,257 $ 4,926,081 Accounts Receivable - related parties $ 12,017,651 $ 10,862,238 Allowance for credit losses (9,098,436 ) (2,128,975 ) Accounts Receivable - related parties, net $ 2,919,215 $ 8,733,263 Non-current Accounts Receivable $ 3,013,532 $ 1,804,189 Non-current credit losses (1,174,302 ) (156,080 ) Non-current Accounts Receivable, net $ 1,839,230 $ 1,648,109 Non-current Accounts Receivable - related parties $ 4,172,502 $ 4,035,831 Non-current Allowance for credit losses - related parties (2,849,306 ) (241,882 ) Non-current Accounts Receivable - related parties, net $ 1,323,196 $ 3,793,949 |
Schedule of Allowance for Credit Losses | The following table describes the movements for allowance for credit losses during the years ended December 31, 2020 and 2019. Balance at January 1, 2019 $ 3,683,842 Increase in allowance for credit losses 3,576,669 Foreign exchange difference (47,867 ) Balance at December 31, 2019 $ 7,212,644 Increase in allowance for credit losses 13,528,638 Foreign exchange difference 476,124 Balance at December 31, 2020 $ 21,217,406 |
Schedule of Future Minimum Payments for Operating Leases | Annual minimum lease payments to be received in the next 5 years: 2021 378,940 2022 136,452 Total 515,392 |
Schedule of Foreign Currency Translation | The exchange rates adopted are as follows: December 31, 2020 December 31, 2019 Year-end RMB to US$ exchange rate 6.5377 6.9692 Average yearly RMB to US$ exchange rate 6.9044 6.9072 |
Property, Equipment and Software [Member] | |
Schedule of Estimated Useful Lives | Estimated useful lives of property, equipment and software are as follows: Office buildings 20-50 years Plant and machinery 3-20 years Electronics equipment, furniture and fixtures 3-5 years Motor vehicles 5 years Purchased software 5 years |
Intangible Assets [Member] | |
Schedule of Estimated Useful Lives | Intangible assets are stated at acquisition fair value or cost less accumulated amortization, and amortized using the straight-line method over the following estimated useful lives: Software development costs 3-5 years Trademarks 5 years |
Variable Interest Entity (Table
Variable Interest Entity (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Variable Interest Entity of Assets and Liabilities | The VIE’s assets and liabilities were as follows as of December 31, 2020 and 2019: December 31, 2020 December 31, 2019 Total current assets $ 9,261,921 $ 17,854,356 Other assets, non-current 4,302,000 4,304,640 Non-current accounts receivable, net 2,101,276 4,985,479 Property, plant and equipment 3,713,860 3,516,313 Intangible assets - - Total assets 19,379,057 30,660,788 Intercompany payable to the WFOE 20,449,508 19,623,596 Total current liabilities 41,717,595 39,005,733 Total liabilities 41,717,595 39,005,733 Total equity $ (22,338,538 ) $ (8,344,945 ) |
Earnings (Loss) Per Share (Tabl
Earnings (Loss) Per Share (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
(Loss) earnings per share - Basic and Diluted | |
Schedule of Components of Basic and Diluted Earnings Per Share | Components of basic and diluted earnings (loss) per share were as follows for the year ended December 31, 2020, 2019, and 2018: 2020 2019* 2018* Net (loss) income attributable to the Company $ (17,694,775 ) $ (3,582,332 ) $ 1,691,983 Weighted average outstanding ordinary shares-Basic 7,373,347 6,964,740 6,809,938 -dilutive effect of stock options- employees - - 111,553 -dilutive effect of stock options- nonemployees - - 6,106 Weighted average outstanding ordinary shares- Diluted 7,373,347 6,964,740 6,927,597 (Loss) earnings per share: Basic $ (2.40 ) $ (0.54 ) $ 0.24 Diluted $ (2.40 ) $ (0.54 ) $ 0.24 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | As of December 31, 2020 and 2019, inventories consist of: December 31, 2020 December 31, 2019 Raw materials $ 3,663 $ 3,437 Finished goods 427,942 453,634 Cost of projects 34,792 49,233 $ 466,397 $ 506,304 Allowance for slow-moving or obsolete inventories (211,719 ) (203,366 ) Inventories, net $ 254,678 $ 302,938 |
Property, Equipment and Softw_2
Property, Equipment and Software, Net (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Equipment and Software | As of December 31, 2020 and 2019, property, equipment and software consist of: December 31, 2020 2019 Office buildings $ 5,140,635 $ 4,822,303 Electronic equipment, furniture and fixtures 5,470,985 5,029,249 Motor vehicles 201,509 242,265 Purchased software 17,465,168 15,538,161 28,278,297 25,631,978 Less: accumulated depreciation (17,426,398 ) (13,796,462 ) Property, equipment and software, net $ 10,851,899 $ 11,835,516 |
Intangible Assets, Net (Tables)
Intangible Assets, Net (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets | As of December 31, 2020 and 2019, intangible assets consist of: Software and software development costs Trademarks Total Gross carrying amounts Balance as of January 1, 2019 $ 4,083,543 892,848 4,976,391 Foreign currency translation (53,061 ) (11,603 ) (64,664 ) Balance as of December 31, 2019 4,030,482 881,245 4,911,727 Foreign currency translation 266,062 58,173 324,235 Balance as of December 31, 2020 4,296,545 939,419 5,235,964 Accumulated amortization Balance as of January 1, 2019 4,037,464 879,006 4,916,470 Amortization expense 45,889 12,275 58,164 Foreign currency translation (52,871 ) (11,532 ) (64,403 ) Balance as of December 31, 2019 4,030,482 879,749 4,910,231 Amortization expense - 1,510 1,510 Foreign currency translation 266,062 58,160 324,221 Balance as of December 31, 2020 4,296,545 939,419 5,235,964 Intangible assets, net $ - $ - $ - |
Bank Loans (Tables)
Bank Loans (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Short-Term Bank Debt | December 31, 2020 December 31, 2019 Secured short-term loans $ 6,210,176 $ 6,584,664 Total short-term bank loans $ 6,210,176 $ 6,584,664 |
Schedule of Secured Short-Term Bank Debt | Detailed information of secured short-term loan balances as of December 31, 2020 and 2019 were as follows: December 31, 2020 December 31, 2019 Collateralized by office buildings of IST and guaranteed by Mr. Lin and Biznest $ 3,976,960 $ 4,017,664 Guaranteed by IST and Mr. Lin and Collateralized by the real property of ISIOT and equity investment of ISTIL 2,019,072 1,985,874 Guaranteed by IST and guaranteed by Mr. Lin and guaranteed by DU YONG - 258,278 Guaranteed by a $ 0.2 million restricted bank time deposit 214,144 Guaranteed by High-tech Investment Company(i) and Mr. Lin - 322,848 Total $ 6,210,176 $ 6,584,664 (i) High-tech Investment Company is an unrelated third party. |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income Before Income Taxes | Pre-tax income (loss) from continuing operations for the year ended December 31, 2020, 2019, and 2018 were taxable in the following jurisdictions: 2020 2019 2018 PRC $ (15,810,350 ) $ (2,342,102 ) $ 2,371,708 Hong Kong (12,072 ) (38,574 ) (28,177 ) BVI (2,580,102 ) (1,488,065 ) (1,665,976 ) Total (loss) income before income taxes $ (18,402,524 ) $ (3,868,741 ) $ 677,555 |
Schedule of Components of Income Tax Expense (Benefit) | Income tax (benefit) expense from continuing operations consists of the following: 2020 2019 2018 Current taxes $ (71,316 ) $ (274,480 ) $ (1,201,231 ) Deferred taxes - - - Income tax (benefit) $ (71,316 ) $ (274,480 ) $ (1,201,231 ) |
Schedule of Effective Income Tax Rate Reconciliation | Current income tax (benefit) expense was recorded in 2020, 2019 and 2018 and was related to differences between the book and corporate income tax returns. 2020 2019 2018 PRC statutory tax rate 25 % 25 % 25 % Computed expected income tax (benefit) expense $ (4,600,631 ) $ (967,185 ) $ 169,389 Tax rate differential benefit from tax holiday 1,805,951 180,996 (246,999 ) Permanent differences 248,636 (203,842 ) (1,376,474 ) Tax effect of deductible temporary differences not recognized 1,826,684 333,891 (170,685 ) Non-deductible tax loss 648,044 381,660 423,538 Income tax (benefit) $ (71,316 ) $ (274,480 ) $ (1,201,231 ) |
Schedule of Components of Deferred Tax Assets and Liabilities | The significant components of deferred tax assets and deferred tax liabilities were as follows as of December 31, 2020 and 2019: December 31, 2020 December 31, 2019 Deferred Deferred Deferred Deferred Tax Tax Tax Tax Assets Liabilities Assets Liabilities Allowance for credit losses $ 3,640,083 $ - $ 1,670,652 $ - Loss carry-forwards 3,714,825 - 2,326,787 - Fixed assets 80,456 (258,451 ) 22,635 (243,517 ) Inventory valuation 369,064 - 332,760 - Long-term investments 5,736 - 5,381 - Intangible assets - 134,197 - 125,887 Gross deferred tax assets and (liabilities) 7,810,164 (124,254 ) 4,358,215 (117,630 ) Valuation allowance (7,685,910 ) - (4,240,585 ) - Total deferred tax assets and (liabilities) $ 124,254 $ (124,254 ) $ 117,630 $ (117,630 ) |
Other Current and Non-Current_2
Other Current and Non-Current Assets (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of Other Current Assets | As of December 31, 2020 and 2019, other current assets consist of: December 31, 2020 December 31, 2019 Advances to unrelated-parties (i) $ 8,305 $ 1,835,826 Advances to employees 45,396 64,777 Other current assets 119,325 187,343 $ 173,026 $ 2,087,946 (i) The advances to unrelated parties for business development, and are non-interest bearing and due on demand. |
Schedule of Other Assets, Noncurrent | As of December 31, 2020 and 2019, Other assets, non-current consist of: December 31, 2020 December 31, 2019 Other assets, non-current, net $ 4,302,000 $ 4,304,640 $ 4,302,000 $ 4,304,640 |
Other Payables and Accrued Ex_2
Other Payables and Accrued Expenses (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Other Liabilities Disclosure [Abstract] | |
Schedule of Other Payable and Accrued Expenses | As of December 31, 2020 and 2019, other payables and accrued expenses consist of: December 31, 2020 December 31, 2019 Advances from unrelated third-parties (i) $ 469,418 $ 115,760 Other taxes payable (ii) 4,089,013 3,927,037 Unrecognized tax benefits (iii) 433,000 433,000 Accrued professional fees 404,025 190,640 Amount due to employees (iv) 65,785 51,188 Other current liabilities (v) 1,174,856 180,047 $ 6,636,097 $ 4,897,672 (i) The advances from unrelated parties are non-interest bearing and due on demand. (ii) The other taxes payable were the amounts due to the value added tax, business tax, city maintenance and construction tax, and individual income tax. The increase in other taxes payable was mainly attributed to reassessment of prior years’ business tax, value added tax, land use tax, and other auxiliary taxes. (iii) The Unrecognized tax benefits refer to the land value added tax due to the sale of property, equipment, and land use rights in September 2015. (iv) The amounts due to employees were pertaining to employees’ out-of-pocket expenses for travel and meal allowance, etc. (v) The other current liabilities included the following: a) approximate of $89,000 loss on a customer’s bankruptcy claim, b) approximate of $203,000 loss on return of prior year’s government funding, c) an amount of $767,500 for ordinary shares converted from the convertible debt, which were not yet issued as of December 31, 2020. |
Equity (Tables)
Equity (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
Schedule of Share Based Payments Expense | The following table provides the details of the approximate total share-based payments expense during the year ended December 31, 2020, 2019, and 2018: For the Year Ended December 31, 2020 December 31, 2019 December 31, 2018 Employees and directors share-based payments $ 298,000 (a)(c) $ 494,000 (c) $ 585,000 (c) Stock options issued for services $ 89,000 (d) $ 67,000 (d) $ 44,000 (d) Shares issued for services $ 357,000 (a) 19,000 (a) - $ 744,000 $ 580,000 $ 629,000 |
Summary of Stock Option Activity | Stock option activity for the year ended December 31, 2020, 2019 and 2018 is summarized as follows: Weighted Average Remaining Weighted Contractual Aggregated Options Average Life Intrinsic Outstanding * Exercise Price* (Year) Value Outstanding at January 1, 2018 486,333 $ 6.84 3.40 $ 996,860 Exercised (133,800 ) 7.26 - - Canceled (18,833 ) $ 6.66 - - Outstanding at December 31, 2018 333,700 $ 6.66 2.40 $ 188,790 Exercised - - - - Canceled (36,800 ) $ 6.90 - - Outstanding at December 31, 2019 296,900 $ 6.66 1.4 $ - Granted 333,348 2.4 - - Exercised (294,733 ) 6.66 - - Canceled (9,167 ) $ 3.48 - - Outstanding at December 31, 2020 326,348 2.4 2.6 $ 143,587 Vested and expected to be vested as of December 31, 2020 310,017 2.4 2.6 136,407 Options exercisable as of December 31, 2020 (vested) - - - - |
Schedule of Non-vested Share Activity | The following table summarizes the status of options which contain vesting provisions: Weighted Average Grant Date Options* Fair Value* Non-vested at January 1, 2020 41,650 $ 3.54 Granted 333,348 $ 1.01 Vested (41,650 ) $ 3.54 Canceled (7,000 ) $ 1.01 Non-vested at December 31, 2020 326,348 $ 1.01 |
Schedule of Options Outstanding and Exercisable | The following table outlines the options outstanding and exercisable as of December 31, 2020: 2020 Number of Options Outstanding Exercise Expiration and Exercisable Price Date July 2020 stock options granted to certain consultants 57,366 $ 2.64 07/09/2023 Total 57,366 |
Consolidated Segment Data (Tabl
Consolidated Segment Data (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting | Selected information by segment is presented in the following tables for the year ended December 31, 2020, 2019, and 2018. 2020 2019 2018 Revenues (1) TIT Segment $ 377,499 $ 241,132 $ 383,420 CBT Segment 10,685,276 13,550,171 20,194,920 $ 11,062,775 $ 13,791,303 $ 20,578,340 (1) 2020 2019 2018 (Loss) income from operations TIT Segment $ (166,727 ) $ (662,556 ) $ (528,891 ) CBT Segment (15,268,750 ) (2,037,151 ) 2,391,930 Corporate and others (2) (1,931,252 ) (1,472,454 ) (1,694,215 ) ( Loss) income from operations (17,366,729 ) (4,172,161 ) 168,824 Corporate other (loss) income, net (22,580 ) 669,755 956,753 Corporate interest income 4,798 133,517 36,381 Corporate interest expense (1,018,013 ) (499,852 ) (484,403 ) (Loss) income before income taxes (18,402,524 ) (3,868,741 ) 677,555 Income tax benefit 71,316 274,480 1,201,231 Net (loss) income (18,331,208 ) (3,594,261 ) 1,878,786 Less: Loss (income) attributable to the non-controlling interest 636,433 11,929 (186,803 ) Net (loss) income attributable to the Company $ (17,694,775 ) $ (3,582,332 ) $ 1,691,983 (2) Non-cash employee compensation by segment for the year ended December 31, 2020, 2019, and 2018 are as follows: 2020 2019 2018 Non-cash employee compensation: Corporate and others 298,091 494,316 584,629 $ 298,091 $ 494,316 $ 584,629 Depreciation and amortization by segment for the year ended December 31, 2020, 2019, and 2018 are as follows: 2020 2019 2018 Depreciation and amortization: TIT Segment $ 19,783 $ 17,278 $ 13,941 CBT Segment 3,459,861 2,883,674 3,660,596 $ 3,479,644 $ 2,900,952 $ 3,674,537 2020 2019 2018 Provisions for allowance for credit losses on accounts receivable, other receivable and advances to suppliers : TIT Segment $ 36,895 $ 344,550 $ (438,378 ) CBT Segment 13,484,287 3,283,994 1,268,644 $ 13,521,182 $ 3,628,544 $ 830,266 2020 2019 2018 Inventory obsolescence provision: TIT Segment $ 10,943 $ 2,366 $ 9,261 CBT Segment (5,318 ) 112,824 21,142 $ 5,625 $ 115,190 $ 30,403 2020 2019 2018 Impairment of long-term investments CBT Segment - - 45,400 $ - $ - $ 45,400 Total assets by segment as at December 31, 2020 and 2019 are as follows: 2020 2019 Total assets TIT Segment $ 213,329 $ 725,088 CBT Segment 30,488,753 39,755,020 Corporate and others 74,569 135,438 $ 30,776,651 $ 40,615,546 |
Organization, Principal Activ_3
Organization, Principal Activities and Management's Plans (Details Narrative) - USD ($) | Dec. 13, 2009 | Jul. 01, 2007 | Sep. 30, 2020 | Mar. 31, 2020 | Mar. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Jul. 31, 2020 |
Purchase price of assets | $ 1,800,000 | ||||||||
Net income loss | $ (17,694,775) | $ (3,582,332) | $ 1,691,983 | ||||||
Cash flow from operating activities | (1,782,839) | (1,682,104) | $ 2,473,802 | ||||||
Working capital deficiency | 17,400,000 | 7,000,000 | |||||||
Accumulated deficit | $ (192,212,544) | $ (174,517,769) | |||||||
Proceeds net of issuance cost and debt discount | $ 1,900,000 | $ 1,900,000 | |||||||
Short-term bank loan | $ 2,000,000 | $ 2,000,000 | |||||||
Subsequent Event [Member] | |||||||||
Proceeds from ordinary shares | $ 13,100,000 | ||||||||
iASPEC Technology Group Co., Ltd. (iASPEC) [Member] | |||||||||
Net profit received, percentage | 95.00% | ||||||||
Taoping New Media Co., Ltd [Member] | Subsequent Event [Member] | |||||||||
Business combination step acquisition shares percentage | 100.00% | ||||||||
Render Lake Tech Limited Member] | Subsequent Event [Member] | |||||||||
Business combination step acquisition shares percentage | 51.00% | ||||||||
Shenzhen Taoping New Media Co., Ltd [Member] | |||||||||
Business combination step acquisition shares percentage | 51.00% |
Organization, Principal Activ_4
Organization, Principal Activities and Management's Plans - Schedule of Subsidiaries and Variable Interest Entity (Details) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Taoping Inc. [Member] | |||
Entities | Taoping Inc. | ||
Location | British Virgin Islands | ||
Taoping Holdings Limited (THL) [Member] | |||
Entities | Taoping Holdings Limited (THL) | ||
Subsidiaries/VIE | Subsidiary | ||
Percentage owned | 100.00% | 100.00% | 100.00% |
Location | British Virgin Islands | ||
Information Security Tech International Co., Ltd. [Member] | |||
Entities | Information Security Tech. International Co., Ltd. (IST HK) | ||
Subsidiaries/VIE | Subsidiary | ||
Percentage owned | 100.00% | 100.00% | 100.00% |
Location | Hong Kong, China | ||
Information Security Tech (China) Co., Ltd. [Member] | |||
Entities | Information Security Tech. (China) Co., Ltd. (IST) | ||
Subsidiaries/VIE | Subsidiary | ||
Percentage owned | 100.00% | 100.00% | 100.00% |
Location | Shenzhen, China | ||
TopCloud Software (China) Co., Ltd. (TopCloud) [Member] | |||
Entities | TopCloud Software (China) Co., Ltd. (TopCloud) | ||
Subsidiaries/VIE | Subsidiary | ||
Percentage owned | 100.00% | 100.00% | 100.00% |
Location | Shenzhen, China | ||
Information Security IoT Tech. Co., Ltd. (ISIOT) [Member] | |||
Entities | Information Security IoT Tech. Co., Ltd. (ISIOT) | ||
Subsidiaries/VIE | Subsidiary | ||
Percentage owned | 100.00% | 100.00% | 100.00% |
Location | Shenzhen, China | ||
iASPEC Technology Group Co., Ltd. (iASPEC) [Member] | |||
Entities | iASPEC Technology Group Co., Ltd. (iASPEC) | ||
Subsidiaries/VIE | VIE | ||
Percentage owned | 100.00% | 100.00% | 100.00% |
Location | Shenzhen, China | ||
Biznest Internet Tech Co., Ltd. [Member] | |||
Entities | Biznest Internet Tech. Co., Ltd. (Biznest) | ||
Subsidiaries/VIE | VIE subsidiary | ||
Percentage owned | 100.00% | 100.00% | 100.00% |
Location | Shenzhen, China | ||
iASPEC Bocom IoT Tech. Co., Ltd. (Bocom) [Member] | |||
Entities | iASPEC Bocom IoT Tech. Co., Ltd. (Bocom) | ||
Subsidiaries/VIE | VIE subsidiary | ||
Percentage owned | 100.00% | 100.00% | 100.00% |
Location | Shenzhen, China |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details Narrative) | Jul. 30, 2020 | Jan. 02, 2020 | Jul. 01, 2017 | Dec. 31, 2020USD ($)Number | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) |
Reverse stock split | On July 30, 2020, the Company implemented a one-for-six reverse stock split of the Company's issued and outstanding ordinary shares | A one (1)-for-six (6) reverse stock split of the Company's issued and outstanding ordinary shares was effective on July 30, 2020 (the "Reverse Stock Split"). | ||||
Cash equivalents | ||||||
Cash and cash equivalents | 882,770 | 1,519,666 | ||||
Restricted cash | 214,144 | |||||
Increase in allowance for credit losses | 13,528,638 | 3,576,669 | ||||
Allowance for credit losses | 21,217,406 | 7,212,644 | $ 3,683,842 | |||
Impairment of long-lived assets | ||||||
Rental income | 405,000 | 420,000 | ||||
Operating lease, description | The Company entered into a lease agreement with Taoping New Media for leasing the Company's office space located at 18th Floor, Education and Technology Building, Zhuzilin, Futian District, Shenzhen City which has been renewed on July 1, 2019 and expires on June 30, 2022. | |||||
Recognized revenue | 256,000 | 335,000 | ||||
Stock-based compensation expense | $ 744,000 | $ 580,000 | 629,000 | |||
Segment reporting description | Reportable segments are defined as an operating segment that either (a) exceeds 10% of revenue, or (b) reported profit or loss in absolute amount exceeds 10% of profit of all operating segments that did not report a loss or (c) exceeds 10% of the combined assets of all operating segments. | |||||
Number of reportable segments | Number | 2 | |||||
Average Yearly RMB [Member] | ||||||
Recognized revenue | $ 1,290,000 | |||||
Foreign currency exchange rate, translation | 6.9044 | 6.9072 | 6.8787 | |||
Accounting Standards Update 2016-02 [Member] | Non-cancelable Operating Lease Agreements [Member] | ||||||
Operating lease, description | The Company owns two units of office space renting out to a third party and a related party under non-cancelable operating lease agreements with lease terms of six years starting from May 1, 2016 and three years starting from July 1, 2019, respectively. | |||||
Accounting Standards Update 2016-02 [Member] | Non-cancelable Operating Lease Agreements [Member] | Third Party [Member] | ||||||
Operating lease term | 6 years | |||||
Accounting Standards Update 2016-02 [Member] | Non-cancelable Operating Lease Agreements [Member] | Related Party [Member] | ||||||
Operating lease term | 3 years | |||||
Maximum [Member] | ||||||
Increase in allowance for credit losses | $ 14,000,000 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Schedule of Accounts Receivable (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Accounting Policies [Abstract] | ||
Accounts Receivable | $ 12,359,619 | $ 9,611,788 |
Allowance for credit losses | (8,095,362) | (4,685,707) |
Accounts Receivable, net | 4,264,257 | 4,926,081 |
Accounts Receivable - related parties | 12,017,651 | 10,862,238 |
Allowance for credit losses | (9,098,436) | (2,128,975) |
Accounts Receivable - related parties, net | 2,919,215 | 8,733,263 |
Non-current Accounts Receivable | 3,013,532 | 1,804,189 |
Non-current credit losses | (1,174,302) | (156,080) |
Non-current Accounts Receivable, net | 1,839,230 | 1,648,109 |
Non-current Accounts Receivable - related parties | 4,172,502 | 4,035,831 |
Non-current Allowance for credit losses - related parties | (2,849,306) | (241,882) |
Non-current Accounts Receivable - related parties, net | $ 1,323,196 | $ 3,793,949 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Schedule of Allowance for Credit Losses (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Accounting Policies [Abstract] | ||
Allowance for credit losses, beginning | $ 7,212,644 | $ 3,683,842 |
Increase in allowance for credit losses | 13,528,638 | 3,576,669 |
Foreign exchange difference | 476,124 | (47,867) |
Allowance for credit losses, ending | $ 21,217,406 | $ 7,212,644 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Schedule of Estimated Useful Lives (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Office Buildings [Member] | Minimum [Member] | |
Estimated useful life of property, plant and equipment | 20 years |
Office Buildings [Member] | Maximum [Member] | |
Estimated useful life of property, plant and equipment | 50 years |
Plant and Machinery [Member] | Minimum [Member] | |
Estimated useful life of property, plant and equipment | 3 years |
Plant and Machinery [Member] | Maximum [Member] | |
Estimated useful life of property, plant and equipment | 20 years |
Electronics Equipment, Furniture and Fixtures [Member] | Minimum [Member] | |
Estimated useful life of property, plant and equipment | 3 years |
Electronics Equipment, Furniture and Fixtures [Member] | Maximum [Member] | |
Estimated useful life of property, plant and equipment | 5 years |
Motor Vehicles [Member] | |
Estimated useful life of property, plant and equipment | 5 years |
Purchased Software [Member] | |
Estimated useful life of property, plant and equipment | 5 years |
Software Development Costs [Member] | Minimum [Member] | |
Estimated useful life of intangible assets | 3 years |
Software Development Costs [Member] | Maximum [Member] | |
Estimated useful life of intangible assets | 5 years |
Trademarks [Member] | |
Estimated useful life of intangible assets | 5 years |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies - Schedule of Future Minimum Payments for Operating Leases (Details) | Dec. 31, 2020USD ($) |
Accounting Policies [Abstract] | |
2021 | $ 378,940 |
2022 | 136,452 |
Total | $ 515,392 |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies - Schedule of Foreign Currency Translation (Details) | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Year-end RMB [Member] | |||
Foreign Currency Exchange Rate, Translation | 6.5377 | 6.9692 | |
Average Yearly RMB [Member] | |||
Foreign Currency Exchange Rate, Translation | 6.9044 | 6.9072 | 6.8787 |
Variable Interest Entity (Detai
Variable Interest Entity (Details Narrative) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Net income/loss | $ 636,433 | $ 11,929 | $ (186,803) |
Variable Interest Entity - Sche
Variable Interest Entity - Schedule of Variable Interest Entity of Assets and Liabilities (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Total current assets | $ 9,261,921 | $ 17,854,356 |
Other assets, non-current | 4,302,000 | 4,304,640 |
Non-current accounts receivable, net | 2,101,276 | 4,985,479 |
Property, plant and equipment | 3,713,860 | 3,516,313 |
Intangible assets | ||
Total assets | 19,379,057 | 30,660,788 |
Intercompany payable to the WFOE | 20,449,508 | 19,623,596 |
Total current liabilities | 41,717,595 | 39,005,733 |
Total liabilities | 41,717,595 | 39,005,733 |
Total equity | $ (22,338,538) | $ (8,344,945) |
Earnings (Loss) Per Share (Deta
Earnings (Loss) Per Share (Details Narrative) - shares | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Number of anti-dilutive shares | 0 | 0 | 117,659 |
Warrants [Member] | |||
Number of anti-dilutive shares | 133,334 | 51,667 | 158,333 |
Stock Options [Member] | |||
Number of anti-dilutive shares | 296,900 |
Earnings (Loss) Per Share - Sch
Earnings (Loss) Per Share - Schedule of Components of Basic and Diluted Earnings Per Share (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
(Loss) earnings per share - Basic and Diluted | |||
Net (loss) income attributable to the Company | $ (17,694,775) | $ (3,582,332) | $ 1,691,983 |
Weighted average outstanding ordinary shares-Basic | 7,373,347 | 6,964,740 | 6,809,938 |
Weighted average outstanding ordinary shares-Basic - dilutive effect of stock options- employees | 111,553 | ||
Weighted average outstanding ordinary shares-Basic - dilutive effect of stock options- nonemployees | 6,106 | ||
Weighted average outstanding ordinary shares- Diluted | 7,373,347 | 6,964,740 | 6,927,597 |
(Loss) earnings per share: Basic | $ (2.40) | $ (0.54) | $ 0.24 |
(Loss) earnings per share: Diluted | $ (2.40) | $ (0.54) | $ 0.24 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | Jul. 01, 2017 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Accounts receivable from related parties | $ 12,017,651 | $ 10,862,238 | ||
Lease expiration date | Jun. 30, 2022 | |||
Lease description | The Company entered into a lease agreement with Taoping New Media for leasing the Company's office space located at 18th Floor, Education and Technology Building, Zhuzilin, Futian District, Shenzhen City which has been renewed on July 1, 2019 and expires on June 30, 2022. | |||
Loan receivable from related party | 519,331 | 397,041 | ||
Taoping New Media Co., Ltd [Member] | ||||
Revenues from related parties | 400,000 | 7,400,000 | $ 9,400,000 | |
Accounts receivable from related parties | 4,200,000 | 12,500,000 | 9,500,000 | |
Advances received from related parties | 161,063 | 140,938 | 51,183 | |
Rental income, related party | 61,000 | 61,000 | 63,000 | |
Other revenue related party | 85,289 | 44,621 | $ 22,416 | |
Loan receivable from related party | 500,000 | 400,000 | ||
Due to related party | 140,000 | 130,000 | ||
iASPEC Technology Group Co., Ltd. (iASPEC) [Member] | ||||
Amount for consultation services | 69,585 | 65,276 | ||
iASPEC Bocom IoT Tech. Co., Ltd. (Bocom) [Member] | ||||
Amount for consultation services | $ 69,585 | $ 66,135 |
Inventories (Details Narrative)
Inventories (Details Narrative) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Inventory Disclosure [Abstract] | |||
Impairments for obsolete inventories | $ 6,000 | $ 115,000 | $ 30,000 |
Inventories - Schedule of Inven
Inventories - Schedule of Inventories (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 3,663 | $ 3,437 |
Finished goods | 427,942 | 453,634 |
Cost of projects | 34,792 | 49,233 |
Inventories, gross | 466,397 | 506,304 |
Allowance for slow-moving or obsolete inventories | (211,719) | (203,366) |
Inventories, net | $ 254,678 | $ 302,938 |
Property, Equipment and Softw_3
Property, Equipment and Software, Net (Details Narrative) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Depreciation expenses | $ 3,206,568 | $ 2,842,787 | $ 2,940,387 |
Office Buildings [Member] | |||
Collateral for short-term-bank loan | $ 3,000,000 |
Property, Equipment and Softw_4
Property, Equipment and Software, Net - Schedule of Property, Equipment and Software (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Property, plant and equipment, gross | $ 28,278,297 | $ 25,631,978 |
Less: accumulated depreciation | (17,426,398) | (13,796,462) |
Property, equipment and software, net | 10,851,899 | 11,835,516 |
Office Buildings [Member] | ||
Property, plant and equipment, gross | 5,140,635 | 4,822,303 |
Electronic Equipment, Furniture and Fixtures [Member] | ||
Property, plant and equipment, gross | 5,470,985 | 5,029,249 |
Motor Vehicles [Member] | ||
Property, plant and equipment, gross | 201,509 | 242,265 |
Purchased Software [Member] | ||
Property, plant and equipment, gross | $ 17,465,168 | $ 15,538,161 |
Intangible Assets, Net (Details
Intangible Assets, Net (Details Narrative) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Amortization expense | $ 273,076 | $ 58,164 | $ 734,150 |
Intangible Assets, Net - Schedu
Intangible Assets, Net - Schedule of Intangible Assets (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Gross carrying amounts, beginning balance | $ 4,911,727 | $ 4,976,391 |
Gross carrying amounts, Foreign currency translation | 324,235 | (64,664) |
Gross carrying amounts, ending balance | 5,235,964 | 4,911,727 |
Accumulated amortization, beginning balance | 4,910,231 | 4,916,470 |
Accumulated amortization, Amortization expense | 1,510 | 58,164 |
Accumulated amortization, Foreign currency translation | 234,221 | (64,403) |
Accumulated amortization, ending balance | 5,235,964 | 4,910,231 |
Intangible assets, net | 1,496 | |
Software and Software Development Costs [Member] | ||
Gross carrying amounts, beginning balance | 4,030,482 | 4,083,543 |
Gross carrying amounts, Foreign currency translation | 266,062 | (53,061) |
Gross carrying amounts, ending balance | 4,296,545 | 4,030,482 |
Accumulated amortization, beginning balance | 4,030,482 | 4,037,464 |
Accumulated amortization, Amortization expense | 45,889 | |
Accumulated amortization, Foreign currency translation | 266,062 | (52,871) |
Accumulated amortization, ending balance | 4,296,545 | 4,030,482 |
Intangible assets, net | ||
Trademarks [Member] | ||
Gross carrying amounts, beginning balance | 881,245 | 892,848 |
Gross carrying amounts, Foreign currency translation | 58,173 | (11,603) |
Gross carrying amounts, ending balance | 939,419 | 881,245 |
Accumulated amortization, beginning balance | 879,749 | 879,006 |
Accumulated amortization, Amortization expense | 1,510 | 12,275 |
Accumulated amortization, Foreign currency translation | 58,160 | (11,532) |
Accumulated amortization, ending balance | 939,419 | $ 879,749 |
Intangible assets, net |
Bank Loans (Details Narrative)
Bank Loans (Details Narrative) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Short-term bank loans | $ 6,210,176 | $ 6,584,664 | $ 6,082,574 |
Debt instrument maturity date description | Mature on various dates from April 29, 2021 to September 14, 2021. | ||
Weighted average interest rate, percentage | 5.59% | 6.56% | 6.43% |
Interest expenses | $ 400,000 | $ 500,000 | $ 500,000 |
Minimum [Member] | |||
Borrowings, interest rate | 4.95% | ||
Maximum [Member] | |||
Borrowings, interest rate | 6.22% |
Bank Loans - Schedule of Short-
Bank Loans - Schedule of Short-Term Bank Debt (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Debt Disclosure [Abstract] | ||
Secured short-term loans | $ 6,210,176 | $ 6,584,664 |
Total short-term bank loans | $ 6,210,176 | $ 6,584,664 |
Bank Loans - Schedule of Secure
Bank Loans - Schedule of Secured Short-Term Bank Debt (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 | |
Total short-term bank loans | $ 6,210,176 | $ 6,584,664 | |
Collateralized by office buildings of IST and guaranteed by Mr. Lin and Biznest [Member] | |||
Total short-term bank loans | 3,976,960 | 4,017,664 | |
Guaranteed by IST and Mr. Lin and Collateralized by the real property of ISIOT and equity investment of ISTIL [Member] | |||
Total short-term bank loans | 2,019,072 | 1,985,874 | |
Guaranteed by IST and guaranteed by Mr. Lin and guaranteed by DU YONG [Member] | |||
Total short-term bank loans | 258,278 | ||
Guaranteed by a $ 0.2 million restricted bank time deposit [Member] | |||
Total short-term bank loans | 214,144 | ||
Guaranteed by High-tech Investment Company(i) and Mr. Lin [Member] | |||
Total short-term bank loans | [1] | $ 322,848 | |
[1] | High-tech Investment Company is an unrelated third party. |
Bank Loans - Schedule of Secu_2
Bank Loans - Schedule of Secured Short-Term Bank Debt (Details) (Parenthetical) | Dec. 31, 2020USD ($) |
Guaranteed by a $ 0.2 million restricted bank time deposit [Member] | |
Restricted bank time deposit | $ 200,000 |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) | 12 Months Ended | |||
Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2020CNY (¥) | |
Income tax examination, description | On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the "Act"). The Act makes broad and complex changes to the U.S. tax code, including, but not limited to, (1) reducing the U.S. federal corporate tax rate from 35 percent to 21 percent. IST is approved as being high-technology enterprises and subject to PRC enterprise income tax rate ("EIT") at 15%. For Biznest, the income tax starts from the earning year, tax free for the first two years and 12.5% income tax rate for year 3-5. | |||
Corporate tax rate | 25.00% | 25.00% | 25.00% | |
Net operating loss carry forward | $ 23,400,000 | |||
Expiration date | Dec. 31, 2025 | |||
Unrecognized tax benefits | ||||
High Technology Enterprise [Member] | ||||
Corporate tax rate | 15.00% | |||
Biznest [Member] | ||||
Corporate tax rate | 12.50% | |||
RMB [Member] | ||||
Net operating loss carry forward | ¥ | ¥ 153,100,000 | |||
U.S [Member] | Maximum [Member] | ||||
Corporate tax rate | 35.00% | |||
U.S [Member] | Minimum [Member] | ||||
Corporate tax rate | 21.00% | |||
Hong Kong [Member] | ||||
Tax profits | 16.50% |
Income Taxes - Schedule of Inco
Income Taxes - Schedule of Income Before Income Taxes (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Total (loss) income before income taxes | $ (18,402,524) | $ (3,868,741) | $ 677,555 |
PRC [Member] | |||
Total (loss) income before income taxes | (15,810,350) | (2,342,102) | 2,371,708 |
Hong Kong [Member] | |||
Total (loss) income before income taxes | (12,072) | (38,574) | (28,177) |
BVI [Member] | |||
Total (loss) income before income taxes | $ (2,580,102) | $ (1,488,065) | $ (1,665,976) |
Income Taxes - Schedule of Comp
Income Taxes - Schedule of Components of Income Tax Expense (Benefit) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||
Current taxes | $ (71,316) | $ (274,480) | $ (1,201,231) |
Deferred taxes | |||
Income tax (benefit) | $ (71,316) | $ (274,480) | $ (1,201,231) |
Income Taxes - Schedule of Effe
Income Taxes - Schedule of Effective Income Tax Rate Reconciliation (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||
PRC statutory tax rate | 25.00% | 25.00% | 25.00% |
Computed expected income tax (benefit) expense | $ (4,600,631) | $ (967,185) | $ 169,389 |
Tax rate differential benefit from tax holiday | 1,805,951 | 180,996 | (246,999) |
Permanent differences | 248,636 | (203,842) | (1,376,474) |
Tax effect of deductible temporary differences not recognized | 1,826,684 | 333,891 | (170,685) |
Non-deductible tax loss | 648,044 | 381,660 | 423,538 |
Income tax (benefit) | $ (71,316) | $ (274,480) | $ (1,201,231) |
Income Taxes - Schedule of Co_2
Income Taxes - Schedule of Components of Deferred Tax Assets and Liabilities (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Income Tax Disclosure [Abstract] | ||
Deferred tax assets, Allowance for doubtful accounts | $ 3,640,083 | $ 1,670,652 |
Deferred tax assets, Loss carry-forwards | 3,714,825 | 2,326,787 |
Deferred tax assets, Fixed assets | 80,456 | 22,635 |
Deferred tax assets, Inventory valuation | 369,064 | 332,760 |
Deferred tax assets, Long-term investments | 5,736 | 5,381 |
Deferred tax assets, Intangible assets | ||
Deferred tax assets, Gross | 7,810,164 | 4,358,215 |
Deferred tax assets, Valuation allowance | (7,685,910) | (4,240,585) |
Total deferred tax assets | 124,254 | 117,630 |
Deferred tax liabilities, Allowance for doubtful accounts | ||
Deferred tax liabilities, Loss carry-forwards | ||
Deferred tax liabilities, Fixed assets | (258,451) | (243,517) |
Deferred tax liabilities, Inventory valuation | ||
Deferred tax liabilities, Salary payable | ||
Deferred tax liabilities, Long-term investments | ||
Deferred tax liabilities, Intangible assets | 134,197 | 125,887 |
Deferred tax liabilities, Gross (liabilities) | (124,254) | (117,630) |
Deferred tax liabilities, Valuation allowance | ||
Total deferred tax (liabilities) | $ (124,254) | $ (117,630) |
Other Current and Non-Current_3
Other Current and Non-Current Assets (Details Narrative) | Oct. 02, 2020 | Apr. 30, 2021USD ($) | Apr. 30, 2021CNY (¥) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2019CNY (¥) | |
Advances to unrelated parties | [1] | $ 8,305 | $ 1,835,826 | |||||
Interest receivables | $ 160,000 | |||||||
Non-interest bearing | 1,660,000 | |||||||
Ownership percentage | 100.00% | |||||||
Revenue | [2] | $ 11,062,775 | 13,791,303 | $ 20,578,340 | ||||
Debt instrument covenant description | Once the vendor fully repays the total funding plus applicable interest, the vendor will own 100% the title of the vehicular terminal and related equipment. | |||||||
Contract term | 4 years | |||||||
Other assets, non-current net | $ 4,302,000 | 4,304,640 | ||||||
Amortization cost | $ 300,000 | |||||||
Subsequent Event [Member] | ||||||||
Debt instrument covenant description | The threshold revenue is to increase incrementally by 15% in every six months going forward until the contract expires four years after the commencing date of the operation. | The threshold revenue is to increase incrementally by 15% in every six months going forward until the contract expires four years after the commencing date of the operation. | ||||||
U.S [Member] | ||||||||
Advances to a vendor | 4,300,000 | |||||||
Total commitment | $ 4,300,000 | |||||||
U.S [Member] | Subsequent Event [Member] | Advertising [Member] | ||||||||
Revenue | $ 462,000 | |||||||
RMB [Member] | ||||||||
Advances to a vendor | ¥ | ¥ 30,000,000 | |||||||
Total commitment | ¥ | ¥ 30,000,000 | |||||||
RMB [Member] | Subsequent Event [Member] | Advertising [Member] | ||||||||
Revenue | ¥ | ¥ 3,000,000 | |||||||
[1] | The advances to unrelated parties for business development, and are non-interest bearing and due on demand. | |||||||
[2] | Revenues by operating segments exclude intercompany transactions. |
Other Current and Non-Current_4
Other Current and Non-Current Assets- Schedule of Other Current Assets (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||
Advances to unrelated-parties | [1] | $ 8,305 | $ 1,835,826 |
Advances to employees | 45,396 | 64,777 | |
Other current assets | 119,325 | 187,343 | |
Total | $ 173,026 | $ 2,087,946 | |
[1] | The advances to unrelated parties for business development, and are non-interest bearing and due on demand. |
Other Current and Non-Current_5
Other Current and Non-Current Assets - Schedule of Other Assets, Noncurrent (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Other assets, non-current, net | $ 4,302,000 | $ 4,304,640 |
Total | $ 4,302,000 | $ 4,304,640 |
Convertible Note Payable (Detai
Convertible Note Payable (Details Narrative) - USD ($) | Sep. 28, 2020 | Oct. 31, 2019 | Sep. 30, 2020 | Mar. 31, 2020 | Oct. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Jul. 30, 2020 |
Debt instrument maturity date, description | Mature on various dates from April 29, 2021 to September 14, 2021. | ||||||||
Proceeds from debt, net of issuance costs | $ 1,900,000 | $ 1,900,000 | |||||||
Shares issued price per share | $ 2.04 | ||||||||
Interest expenses | $ 400,000 | $ 500,000 | $ 500,000 | ||||||
Convertible note payable, net of debt discounts | 1,180,908 | $ 916,511 | |||||||
Note Holder One [Member] | |||||||||
Beneficial conversion feature | $ 113,526 | ||||||||
Note Holder Two [Member] | |||||||||
Beneficial conversion feature | 165,580 | ||||||||
Note Holder Three [Member] | |||||||||
Beneficial conversion feature | 246,040 | ||||||||
Convertible Promissory Note-2 [Member] | |||||||||
Fair value of warrant liability | 1,388,420 | ||||||||
Convertible Promissory Note-2 [Member] | Warrants [Member] | |||||||||
Fair value of warrant liability | 11,580 | ||||||||
Convertible Promissory Note-2 [Member] | Warrants [Member] | Note Holder [Member] | |||||||||
Fair value of warrant liability | 11,676 | ||||||||
Convertible Promissory Note-3 [Member] | |||||||||
Fair value of warrant liability | 1,381,960 | ||||||||
Convertible Promissory Note-3 [Member] | Warrants [Member] | |||||||||
Fair value of warrant liability | 18,040 | ||||||||
Convertible Promissory Note-3 [Member] | Warrants [Member] | Note Holder [Member] | |||||||||
Fair value of warrant liability | 18,275 | ||||||||
Convertible Promissory Note-1 [Member] | |||||||||
Fair value of warrant liability | 988,874 | ||||||||
Beneficial conversion feature | $ 21,000 | ||||||||
Debt discount | $ 21,000 | ||||||||
Floor price per share | $ 2.4 | $ 3 | |||||||
Beneficial conversion feature description | Because the difference in fair value of embedded conversion feature immediately before and immediately after the modification was approximately $21,000, which is less than 10% of the initial fair value of the Note, it was considered a modification effectuated on September 28, 2020. | ||||||||
Convertible Promissory Note-1 [Member] | Warrants [Member] | |||||||||
Fair value of warrant liability | 11,126 | ||||||||
Convertible Promissory Note-1 [Member] | Warrants [Member] | Note Holder [Member] | |||||||||
Fair value of warrant liability | 11,250 | ||||||||
Note-1 [Member] | |||||||||
Proceeds to beneficial conversion feature and detachable warrant | 164,651 | ||||||||
Interest expenses | 160,216 | ||||||||
Contractual interest obligation | 37,000 | ||||||||
Amortization of the discounts and debt issuance cost | 124,000 | ||||||||
Convertible note payable, net of debt discounts | 998,837 | ||||||||
Note-2 [Member] | |||||||||
Proceeds to beneficial conversion feature and detachable warrant | 257,159 | ||||||||
Finder Fee | 80,000 | ||||||||
Equity component cost | 24,000 | ||||||||
Debt discount | 56,000 | ||||||||
Interest expenses | 244,871 | ||||||||
Contractual interest obligation | 46,000 | ||||||||
Amortization of the discounts and debt issuance cost | 199,000 | ||||||||
Note-3 [Member] | |||||||||
Proceeds to beneficial conversion feature and detachable warrant | 344,079 | ||||||||
Unamortized debt discount | 257,352 | ||||||||
Finder Fee | 80,874 | ||||||||
Equity component cost | 24,262 | ||||||||
Debt discount | 56,612 | ||||||||
Interest expenses | 119,648 | ||||||||
Contractual interest obligation | 19,000 | ||||||||
Amortization of the discounts and debt issuance cost | 101,000 | ||||||||
Convertible note payable, net of debt discounts | $ 1,180,908 | ||||||||
Private Placement [Member] | Convertible Promissory Note [Member] | |||||||||
Principal amount | $ 1,040,000 | $ 1,040,000 | |||||||
Debt instrument, interest rate | 5.00% | 5.00% | |||||||
Original issue discount | $ 40,000 | $ 40,000 | |||||||
Shares issued price per share | $ 9 | $ 9 | |||||||
Warrants to purchase common stock | 26,667 | 26,667 | |||||||
Warrant exercise price | $ 9 | $ 9 | |||||||
Private Placement [Member] | Convertible Promissory Note-2 [Member] | |||||||||
Principal amount | $ 1,480,000 | ||||||||
Debt instrument, interest rate | 5.00% | ||||||||
Original issue discount | $ 80,000 | ||||||||
Proceeds from debt, net of issuance costs | $ 1,340,000 | ||||||||
Shares issued price per share | $ 9 | ||||||||
Debt conversion description | On the Maturity Dates, the holders of the Notes have the rights to convert all of the outstanding balance of the Notes at a price of no less than $3.0 per share for Note-1 and $2.4 per share for Note-2 and Note-3. | ||||||||
Warrants to purchase common stock | 53,334 | ||||||||
Warrant exercise price | $ 9 | ||||||||
Private Placement [Member] | Convertible Promissory Note-2 [Member] | Purchase Agreement [Member] | |||||||||
Proceeds from debt, net of issuance costs | $ 1,900,000 | ||||||||
Shares issued price per share | $ 2.1 | ||||||||
Shares upon conversion | 285,714 | ||||||||
Private Placement [Member] | Convertible Promissory Note-2 [Member] | Maximum [Member] | |||||||||
Shares upon conversion | 1,000,000 | ||||||||
Private Placement [Member] | Convertible Promissory Note-3 [Member] | |||||||||
Principal amount | $ 1,480,000 | ||||||||
Debt instrument, interest rate | 5.00% | ||||||||
Original issue discount | $ 80,000 | ||||||||
Proceeds from debt, net of issuance costs | $ 1,340,000 | ||||||||
Shares issued price per share | $ 9 | ||||||||
Debt conversion description | On the Maturity Dates, the holders of the Notes have the rights to convert all of the outstanding balance of the Notes at a price of no less than $3.0 per share for Note-1 and $2.4 per share for Note-2 and Note-3. | ||||||||
Warrants to purchase common stock | 53,334 | ||||||||
Warrant exercise price | $ 9 | ||||||||
Private Placement [Member] | Convertible Promissory Note-3 [Member] | Purchase Agreement [Member] | |||||||||
Proceeds from debt, net of issuance costs | $ 1,900,000 | ||||||||
Shares issued price per share | $ 2.7 | ||||||||
Shares upon conversion | 222,222 | ||||||||
Private Placement [Member] | Convertible Promissory Note-3 [Member] | Maximum [Member] | |||||||||
Shares upon conversion | 1,000,000 | ||||||||
Private Placement [Member] | Convertible Promissory Note-1 [Member] | |||||||||
Debt instrument maturity date, description | All three Notes mature in 12 months from the issue dates of the Notes | ||||||||
Proceeds from debt, net of issuance costs | $ 1,000,000 | ||||||||
Debt conversion description | On the Maturity Dates, the holders of the Notes have the rights to convert all of the outstanding balance of the Notes at a price of no less than $3.0 per share for Note-1 and $2.4 per share for Note-2 and Note-3. | ||||||||
Private Placement [Member] | Convertible Promissory Note-1 [Member] | Purchase Agreement [Member] | |||||||||
Proceeds from debt, net of issuance costs | $ 1,000,000 | ||||||||
Private Placement [Member] | Convertible Promissory Note-1 [Member] | Maximum [Member] | |||||||||
Shares upon conversion | 470,000 |
Other Payables and Accrued Ex_3
Other Payables and Accrued Expenses - Schedule of Other Payable and Accrued Expenses (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 | |
Other Liabilities Disclosure [Abstract] | |||
Advances from unrelated third-parties | [1] | $ 469,418 | $ 115,760 |
Other taxes payable | [2] | 4,089,013 | 3,927,037 |
Unrecognized tax benefits | [3] | 433,000 | 433,000 |
Accrued professional fees | 404,025 | 190,640 | |
Amount due to employees | [4] | 65,785 | 51,188 |
Other current liabilities | [5] | 1,174,856 | 180,047 |
Other Payables and Accrued Expenses | $ 6,636,097 | $ 4,897,672 | |
[1] | The advances from unrelated parties are non-interest bearing and due on demand. | ||
[2] | The other taxes payable were the amounts due to the value added tax, business tax, city maintenance and construction tax, and individual income tax. The increase in other taxes payable was mainly attributed to reassessment of prior years' business tax, value added tax, land use tax, and other auxiliary taxes. | ||
[3] | The Unrecognized tax benefits refer to the land value added tax due to the sale of property, equipment, and land use rights in September 2015. | ||
[4] | The amounts due to employees were pertaining to employees' out-of-pocket expenses for travel and meal allowance, etc. | ||
[5] | The other current liabilities included the following: a) approximate of $89,000 loss on a customer's bankruptcy claim, b) approximate of $203,000 loss on return of prior year's government funding, c) an amount of $767,500 for ordinary shares converted from the convertible debt, which were not yet issued as of December 31, 2020. |
Other Payables and Accrued Ex_4
Other Payables and Accrued Expenses - Schedule of Other Payable and Accrued Expenses (Details) (Parenthetical) | Dec. 31, 2020USD ($) |
Other Liabilities Disclosure [Abstract] | |
Loss on customer bankruptcy claim | $ 89,000 |
Loss on return of prior year's government funding | 203,000 |
Convertible debt instrument amount | $ 767,500 |
Reserve and Distribution of P_2
Reserve and Distribution of Profit (Details Narrative) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Reserve And Distribution Of Profit | ||
Annual tax profits | 10.00% | |
Statutory reserve percentage | 50.00% | |
General reserve | $ 14,000,000 | $ 14,000,000 |
Equity (Details Narrative)
Equity (Details Narrative) - USD ($) | Dec. 31, 2020 | Dec. 30, 2020 | Jul. 31, 2020 | Jul. 30, 2020 | Jul. 24, 2020 | May 17, 2017 | May 27, 2016 | May 09, 2016 | Sep. 30, 2020 | Jul. 31, 2020 | Apr. 30, 2020 | Mar. 31, 2020 | Oct. 31, 2019 | Nov. 30, 2018 | Jan. 31, 2018 | Sep. 30, 2020 | Jun. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Apr. 02, 2020 | Feb. 20, 2019 | |
Ordinary shares, authorized | 100,000,000 | 100,000,000 | 100,000,000 | ||||||||||||||||||||
Number of shares issued, value | $ 1,500,000 | ||||||||||||||||||||||
Shares issued price per share | $ 2.04 | ||||||||||||||||||||||
Number of restricted shares issued | 32,887 | ||||||||||||||||||||||
Shares issued for services, value | 46,500 | ||||||||||||||||||||||
Ordinary shares, no par value | $ 0 | $ 0 | $ 0 | ||||||||||||||||||||
Stock option to purchase common stock | [1] | 333,348 | |||||||||||||||||||||
Share based compensation | $ 744,000 | $ 580,000 | 629,000 | ||||||||||||||||||||
Proceeds from stock options exercised | 44,843 | ||||||||||||||||||||||
Unrecognized compensation expense related to non-vested share options | $ 200,000 | $ 200,000 | $ 100,000 | ||||||||||||||||||||
Weighted average remaining vesting period | 3 months 19 days | 1 month 6 days | |||||||||||||||||||||
Fair value of stock option vested | $ 100,000 | $ 600,000 | 600,000 | ||||||||||||||||||||
Reverse stock split description | On July 30, 2020, the Company implemented a one-for-six reverse stock split of the Company's issued and outstanding ordinary shares | A one (1)-for-six (6) reverse stock split of the Company's issued and outstanding ordinary shares was effective on July 30, 2020 (the "Reverse Stock Split"). | |||||||||||||||||||||
Administrative expense | $ 16,707,106 | 6,657,972 | $ 4,299,820 | ||||||||||||||||||||
2016 Equity Incentive Plan [Member] | |||||||||||||||||||||||
Number of shares issued | 79,834 | ||||||||||||||||||||||
Stock option to purchase common stock | 452,000 | ||||||||||||||||||||||
Fair value of stock option grant date | $ 1,600,000 | ||||||||||||||||||||||
2016 Equity Incentive Plan [Member] | Administrative Expenses [Member] | |||||||||||||||||||||||
Share based compensation | $ 365,000 | $ 407,000 | |||||||||||||||||||||
Employees [Member] | |||||||||||||||||||||||
Number of shares issued | 79,834 | ||||||||||||||||||||||
Number of shares issued, value | $ 626,000 | ||||||||||||||||||||||
Consultants [Member] | |||||||||||||||||||||||
Number of shares issued | 8,333 | 40,000 | |||||||||||||||||||||
Number of shares issued, value | $ 24,000 | ||||||||||||||||||||||
Number of restricted shares issued | 40,000 | ||||||||||||||||||||||
Shares issued for services | 40,000 | ||||||||||||||||||||||
Shares issued for services, value | $ 110,000 | ||||||||||||||||||||||
Consultants [Member] | 2016 Equity Incentive Plan [Member] | |||||||||||||||||||||||
Stock option to purchase common stock | 57,366 | 33,333 | |||||||||||||||||||||
Stock option vested, shares | 12,500 | 20,833 | |||||||||||||||||||||
Warrants to purchase common stock | 16,667 | 25,000 | |||||||||||||||||||||
Warrants exercise price | $ 2.52 | $ 6.60 | |||||||||||||||||||||
Stock options exercised | 6,250 | ||||||||||||||||||||||
Shares exercises price per share | $ 2.64 | ||||||||||||||||||||||
Administrative expense | $ 89,000 | $ 67,000 | $ 44,000 | ||||||||||||||||||||
Consultants [Member] | 2016 Equity Incentive Plan [Member] | Warrants Two [Member] | |||||||||||||||||||||||
Stock options exercised | 11,894 | ||||||||||||||||||||||
Two Individuals [Member] | |||||||||||||||||||||||
Number of shares issued | 166,667 | ||||||||||||||||||||||
Shares issued price per share | $ 0.9 | ||||||||||||||||||||||
Consideration amount | $ 1,500,000 | ||||||||||||||||||||||
Individual Investor [Member] | |||||||||||||||||||||||
Number of shares issued | 285,714 | ||||||||||||||||||||||
Shares issued price per share | $ 2.1 | ||||||||||||||||||||||
Proceeds from issuance of common stock | $ 576,000 | ||||||||||||||||||||||
Investors [Member] | |||||||||||||||||||||||
Number of shares issued | 30,000 | ||||||||||||||||||||||
Proceeds from issuance of common stock | $ 144,000 | ||||||||||||||||||||||
Consultant [Member] | |||||||||||||||||||||||
Number of restricted shares issued | 16,220 | 16,667 | |||||||||||||||||||||
Shares issued for services | 42,000 | 16,667 | |||||||||||||||||||||
Shares issued for services, value | $ 41,000 | $ 101,000 | $ 42,000 | ||||||||||||||||||||
Employee [Member] | |||||||||||||||||||||||
Shares issued for services | 13,110 | ||||||||||||||||||||||
Shares issued for services, value | $ 65,000 | ||||||||||||||||||||||
Stock option to purchase common stock | 333,348 | ||||||||||||||||||||||
Intrinsic value of stock options exercised | $ 637,000 | $ 1,473,000 | |||||||||||||||||||||
Proceeds from stock options exercised | |||||||||||||||||||||||
Promissory Note Holder [Member] | |||||||||||||||||||||||
Number of shares issued | 1,066,845 | ||||||||||||||||||||||
Ordinary shares, no par value | |||||||||||||||||||||||
Debt instrument shares converted | 299,318 | ||||||||||||||||||||||
Debt instrument shares converted amount | $ 1,800,000 | ||||||||||||||||||||||
Directors, Employees and Consultants [Member] | 2016 Equity Incentive Plan [Member] | |||||||||||||||||||||||
Number of ordinary shares issued as equity incentives | 833,334 | ||||||||||||||||||||||
Employees and Directors [Member] | 2016 Equity Incentive Plan [Member] | |||||||||||||||||||||||
Number of shares issued | 72,414 | ||||||||||||||||||||||
Stock option to purchase common stock | 333,348 | 160,000 | |||||||||||||||||||||
Fair value of stock option grant date | $ 300,000 | $ 500,000 | |||||||||||||||||||||
Employees and Directors [Member] | 2016 Equity Incentive Plan [Member] | Administrative Expenses [Member] | |||||||||||||||||||||||
Share based compensation | $ 140,000 | $ 92,000 | $ 129,000 | $ 178,000 | |||||||||||||||||||
Non-employees [Member] | |||||||||||||||||||||||
Stock option weighted average exercise price per shares | $ 2.64 | $ 2.64 | |||||||||||||||||||||
Stock option weighted average remaining life | 2 years 6 months 7 days | ||||||||||||||||||||||
[1] | On July 30, 2020, the Company implemented a one-for-six reverse stock split of the Company's issued and outstanding ordinary shares. Except shares authorized, all share and per share information has been retroactively adjusted to give effect to the reverse stock split for all periods presented, unless otherwise indicated. |
Equity - Schedule of Share Base
Equity - Schedule of Share Based Payments Expense (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Equity [Abstract] | |||
Employees and directors share-based payments | $ 298,000 | $ 494,000 | $ 585,000 |
Stock options issued for services | 89,000 | 67,000 | 44,000 |
Shares issued for services | 357,000 | 19,000 | |
Total share based payments expenses | $ 744,000 | $ 580,000 | $ 629,000 |
Equity - Summary of Stock Optio
Equity - Summary of Stock Option Activity (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | ||
Option Outstanding, Granted | [1] | 333,348 | ||
Weighted Average Remaining Contractual Life (Year), Vested and expected to be vested | 3 months 19 days | 1 month 6 days | ||
Stock Option [Member] | ||||
Option Outstanding, Balance Beginning | 296,900 | 333,700 | 486,333 | |
Option Outstanding, Granted | 333,348 | |||
Option Outstanding, Exercised | (294,733) | (133,800) | ||
Option Outstanding, Canceled | (9,167) | (36,800) | (18,833) | |
Option Outstanding, Balance Ending | 326,348 | 296,900 | 333,700 | |
Option Outstanding, Vested and expected to be vested | 310,017 | |||
Option Outstanding, Options Exercisable | ||||
Weighted Average Exercise Price, Beginning Balance | $ 6.66 | $ 6.66 | $ 6.84 | |
Weighted Average Exercise Price, Granted | 2.4 | |||
Weighted Average Exercise Price, Exercised | 6.66 | 7.26 | ||
Weighted Average Exercise Price, Canceled | 3.48 | 6.90 | 6.66 | |
Weighted Average Exercise Price, Ending Balance | 2.4 | $ 6.66 | $ 6.66 | |
Weighted Average Exercise Price, Vested and expected to be vested | 2.4 | |||
Weighted Average Exercise Price, Options Exercisable | ||||
Weighted Average Remaining Contractual Life (Year), Beginning | 1 year 4 months 24 days | 2 years 4 months 24 days | 3 years 4 months 24 days | |
Weighted Average Remaining Contractual Life (Year), Ending | 2 years 7 months 6 days | 1 year 4 months 24 days | 2 years 4 months 24 days | |
Weighted Average Remaining Contractual Life (Year), Vested and expected to be vested | 2 years 7 months 6 days | |||
Weighted Average Remaining Contractual Life (Year), Options exercisable | 0 years | |||
Aggregated Intrinsic Value, Outstanding Beginning | $ 188,790 | $ 996,860 | ||
Aggregated Intrinsic Value, Outstanding Ending | 143,587 | 188,790 | ||
Aggregated Intrinsic Value, Vested and expected to be vested | 136,407 | |||
Aggregated Intrinsic Value, Options exercisable | ||||
[1] | On July 30, 2020, the Company implemented a one-for-six reverse stock split of the Company's issued and outstanding ordinary shares. Except shares authorized, all share and per share information has been retroactively adjusted to give effect to the reverse stock split for all periods presented, unless otherwise indicated. |
Equity - Schedule of Non-vested
Equity - Schedule of Non-vested Share Activity (Details) | 12 Months Ended | |
Dec. 31, 2020$ / sharesshares | [1] | |
Equity [Abstract] | ||
Options Non-vested, Beginning | shares | 41,650 | |
Options Granted | shares | 333,348 | |
Options Vested | shares | (41,650) | |
Options Canceled | shares | (7,000) | |
Options Non-vested, Ending | shares | 326,348 | |
Weighted Average Grant Date Fair Value, Non-Vested Beginning Balance | $ / shares | $ 3.54 | |
Weighted Average Grant Date Fair Value, Granted | $ / shares | 1.01 | |
Weighted Average Grant Date Fair Value, Vested | $ / shares | 3.54 | |
Weighted Average Grant Date Fair Value, Canceled | $ / shares | 1.01 | |
Weighted Average Grant Date Fair Value, Non-Vested Ending Balance | $ / shares | $ 1.01 | |
[1] | On July 30, 2020, the Company implemented a one-for-six reverse stock split of the Company's issued and outstanding ordinary shares. Except shares authorized, all share and per share information has been retroactively adjusted to give effect to the reverse stock split for all periods presented, unless otherwise indicated. |
Equity - Schedule of Options Ou
Equity - Schedule of Options Outstanding and Exercisable (Details) | 12 Months Ended |
Dec. 31, 2020$ / sharesshares | |
Number of Options Outstanding and Exercisable | 57,366 |
July 2020 Stock Options Granted to Certain Consultants [Member] | |
Number of Options Outstanding and Exercisable | 57,366 |
Exercise Price | $ / shares | $ 2.64 |
Expiration Date | Jul. 9, 2023 |
Consolidated Segment Data - Sch
Consolidated Segment Data - Schedule of Segment Reporting (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | ||
Revenues | [1] | $ 11,062,775 | $ 13,791,303 | $ 20,578,340 |
(Loss) income from operations | (17,366,729) | (4,172,161) | 168,824 | |
Corporate other (loss) income, net | (22,580) | 669,755 | 956,753 | |
Corporate interest income | 4,798 | 133,517 | 36,381 | |
Corporate interest expense | (1,018,013) | (499,852) | (484,403) | |
(Loss) income before income taxes | (18,402,524) | (3,868,741) | 677,555 | |
Income tax benefit | 71,316 | 274,480 | 1,201,231 | |
Net (loss) income | (18,331,208) | (3,594,261) | 1,878,786 | |
Less: (Loss) income attributable to the non-controlling interest | 636,433 | 11,929 | (186,803) | |
Net (loss) income attributable to the Company | (17,694,775) | (3,582,332) | 1,691,983 | |
Non-cash employee compensation | 298,091 | 494,316 | 584,629 | |
Depreciation and amortization | 3,479,644 | 2,900,952 | 3,674,537 | |
Provisions for allowance for credit losses on accounts receivable, other receivable and advances to suppliers | 13,521,182 | 3,628,544 | 830,266 | |
Inventory obsolescence provision | 5,629 | 115,191 | 30,403 | |
Impairment of long-term investments | 45,400 | |||
Total assets | 30,776,651 | 40,615,546 | ||
TIT Segment [Member] | ||||
Revenues | [1] | 377,499 | 241,132 | 383,420 |
(Loss) income from operations | (166,727) | (662,556) | (528,891) | |
Depreciation and amortization | 19,783 | 17,278 | 13,941 | |
Provisions for allowance for credit losses on accounts receivable, other receivable and advances to suppliers | 36,895 | 344,550 | (438,378) | |
Inventory obsolescence provision | 10,943 | 2,366 | 9,261 | |
Total assets | 213,329 | 725,088 | ||
CBT Segment [Member] | ||||
Revenues | [1] | 10,685,276 | 13,550,171 | 20,194,920 |
(Loss) income from operations | (15,268,750) | (2,037,151) | 2,391,930 | |
Depreciation and amortization | 3,459,861 | 2,883,674 | 3,660,596 | |
Provisions for allowance for credit losses on accounts receivable, other receivable and advances to suppliers | 13,484,287 | 3,283,994 | 1,268,644 | |
Inventory obsolescence provision | (5,318) | 112,824 | 21,142 | |
Impairment of long-term investments | 45,400 | |||
Total assets | 30,488,753 | 39,755,020 | ||
Corporate and Others [Member] | ||||
(Loss) income from operations | [2] | (1,931,252) | (1,472,454) | (1,694,215) |
Non-cash employee compensation | 298,091 | 494,316 | $ 584,629 | |
Total assets | $ 74,569 | $ 135,438 | ||
[1] | Revenues by operating segments exclude intercompany transactions. | |||
[2] | Includes non-cash compensation, professional fees and consultancy fees for the Company. |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) | Jul. 30, 2020$ / shares | Jul. 28, 2016USD ($) | Jul. 28, 2016CNY (¥) | Mar. 31, 2021USD ($) | Dec. 31, 2020USD ($) | Dec. 12, 2018USD ($) |
Ownership percentage | 100.00% | |||||
Reverse stock split description | On July 30, 2020, the Company implemented a one-for-six reverse stock split of the Company's issued and outstanding ordinary shares | A one (1)-for-six (6) reverse stock split of the Company's issued and outstanding ordinary shares was effective on July 30, 2020 (the "Reverse Stock Split"). | ||||
Share issued price per share | $ / shares | $ 2.04 | |||||
Accrued contingent liability | $ 89,000 | |||||
Subsequent Event [Member] | ||||||
Net proceeds raised from additional injection | $ 13,100,000 | |||||
Asia Taoping PTE. LTD [Member] | ||||||
Ownership percentage | 10.00% | |||||
Registered capital | $ 369,000 | |||||
Kejian [Member] | ||||||
Preferential payment received | $ 89,000 | |||||
Kejian [Member] | RMB [Member] | ||||||
Preferential payment received | ¥ | ¥ 550,000 |
Concentrations (Details Narrati
Concentrations (Details Narrative) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Five Unrelated Suppliers [Member] | |||
Concentration of risk percentage | 62.00% | 97.00% | 89.00% |
Minimum [Member] | Supplier One [Member] | |||
Concentration of risk percentage | 10.00% | 10.00% | 10.00% |
Minimum [Member] | Supplier Two [Member] | |||
Concentration of risk percentage | 10.00% | 10.00% | 10.00% |
Minimum [Member] | Supplier Three [Member] | |||
Concentration of risk percentage | 10.00% | ||
Sales Revenue, Net [Member] | No Customer [Member] | |||
Concentration of risk percentage | 10.00% | 10.00% | |
Sales Revenue, Net [Member] | No Customer [Member] | Minimum [Member] | |||
Concentration of risk percentage | 10.00% | ||
Sales Revenue, Net [Member] | One Customer [Member] | |||
Concentration of risk percentage | 10.00% | ||
Sales Revenue, Net [Member] | Top Five Customers [Member] | |||
Concentration of risk percentage | 25.00% | 24.00% | 23.00% |
Accounts Receivable [Member] | No Customer [Member] | Minimum [Member] | |||
Concentration of risk percentage | 10.00% | ||
Accounts Receivable [Member] | Top Five Customers [Member] | |||
Concentration of risk percentage | 25.00% | 20.00% |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - USD ($) | Apr. 16, 2021 | Mar. 19, 2021 | Feb. 19, 2021 | Mar. 31, 2021 | Jun. 30, 2020 | Mar. 13, 2022 | Apr. 15, 2021 | Mar. 29, 2021 | Mar. 22, 2021 | Jan. 26, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Stock par value per share | $ 0 | $ 0 | ||||||||||
Equity method ownership percentage | 100.00% | |||||||||||
Investors [Member] | ||||||||||||
Proceeds from issuance of shares before deducting offering expenses | $ 144,000 | |||||||||||
Strategic Cooperation Agreement [Member] | BitFuFu [Member] | Forecast [Member] | ||||||||||||
Service subscription amount | $ 1,000,000 | |||||||||||
Subsequent Event [Member] | ||||||||||||
Proceeds from issuance of shares before deducting offering expenses | $ 13,100,000 | |||||||||||
Subsequent Event [Member] | Mr. Jianghuai Lin [Member] | ||||||||||||
Business acquisition ownership percentage | 24.60% | |||||||||||
Subsequent Event [Member] | Securities Purchase Agreement [Member] | Investors [Member] | ||||||||||||
Aggregate number of ordinary shares sold | 3,140,740 | |||||||||||
Stock par value per share | ||||||||||||
Proceeds from issuance of shares before deducting offering expenses | $ 13,100,000 | |||||||||||
Subsequent Event [Member] | Strategic Partnership Agreement [Member] | Ivy International Education [Member] | ||||||||||||
Equity method ownership percentage | 51.00% | |||||||||||
Subsequent Event [Member] | Strategic Cooperation Agreement [Member] | BitFuFu [Member] | ||||||||||||
Value of blockchain cloud computing service | $ 10,000,000 | |||||||||||
Subsequent Event [Member] | Strategic Cooperation Frameword Agreement [Member] | Biznes [Member] | ||||||||||||
Equity method ownership percentage | 51.00% | |||||||||||
Subsequent Event [Member] | Strategic Cooperation Frameword Agreement [Member] | Wuhu Sasan [Member] | ||||||||||||
Equity method ownership percentage | 49.00% | |||||||||||
Subsequent Event [Member] | Consulting Agreement [Member] | Great Bay Capital Investment Limited [Member] | ||||||||||||
Term of agreement | 2 years | |||||||||||
Warrants to purchase ordinary shares | 1,000,000 | |||||||||||
Warrants exercise price per share | $ 3.50 | |||||||||||
Subsequent Event [Member] | Consulting Agreement [Member] | Jinzefu and Shanjing Capital [Member] | ||||||||||||
Term of agreement | 1 year | |||||||||||
Warrants to purchase ordinary shares | 450,000 | |||||||||||
Warrants exercise price per share | $ 6.30 | |||||||||||
Subsequent Event [Member] | Share Purchase Agreement [Member] | Taoping New Media Co., Ltd [Member] | ||||||||||||
Business acquisition ownership percentage | 100.00% | |||||||||||
Ordinary shares issued under business acquisition | 1,213,630 | |||||||||||
Value of shares issued under business acquisition | $ 10,240,000 | |||||||||||
Subsequent Event [Member] | Share Purchase Agreement [Member] | Genie Global Limited [Member] | ||||||||||||
Equity method ownership percentage | 51.00% | |||||||||||
Subsequent Event [Member] | Share Purchase Agreement [Member] | Mr. Jianghuai Lin [Member] | Taoping New Media Co., Ltd [Member] | ||||||||||||
Equity method ownership percentage | 51.00% | |||||||||||
Ordinary shares issued under business acquisition | 614,369 | |||||||||||
Subsequent Event [Member] | Purchase Agreement [Member] | Bitmain Technologies Limited [Member] | ||||||||||||
Value of bitcoin mining machines | $ 24,000,000 |