Document and Entity Information
Document and Entity Information | 12 Months Ended |
Mar. 31, 2020shares | |
Document and Entity Information [Abstract] | |
Entity Registrant Name | Happiness Biotech Group Ltd |
Entity Central Index Key | 0001751876 |
Amendment Flag | false |
Current Fiscal Year End Date | --03-31 |
Document Type | 20-F |
Document Period End Date | Mar. 31, 2020 |
Document Fiscal Period Focus | FY |
Document Fiscal Year Focus | 2020 |
Entity Emerging Growth Company | true |
Entity Well-known Seasoned Issuer | No |
Entity Voluntary Filers | No |
Entity Current Reporting Status | Yes |
Entity Filer Category | Non-accelerated Filer |
Entity Ex Transition Period | false |
Entity Shell Company | false |
Document Transition Report | false |
Document Annual Report | true |
Document Shell Company Report | false |
Entity Interactive Data Current | Yes |
Entity Incorporation State Country Code | E9 |
Entity File Number | 333-230170 |
Entity Common Stock, Shares Outstanding | 25,000,000 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Mar. 31, 2020 | Mar. 31, 2019 |
Current assets | ||
Cash and cash equivalents | $ 33,654,765 | $ 14,800,772 |
Accounts receivable | 30,036,448 | 32,011,536 |
Inventories | 2,029,406 | 1,970,735 |
Prepaid expenses and other current assets | 4,264,130 | 6,057,216 |
Total current assets | 69,984,749 | 54,840,259 |
Property, plant and equipment, net | 7,896,501 | 7,807,045 |
Land use rights, net | 719,722 | 774,374 |
Other assets | 6,496,501 | 2,257,370 |
TOTAL ASSETS | 85,097,473 | 65,679,048 |
Current liabilities | ||
Accounts payable | 1,549,255 | 1,664,002 |
Other payables and accrued liabilities | 512,249 | 1,117,661 |
Due to related parties | 844,716 | |
Income tax payable | 568,830 | 942,160 |
Short-term bank borrowings | 2,032,434 | 1,039,578 |
TOTAL LIABILITIES | 5,507,484 | 4,763,401 |
COMMITMENTS AND CONTINGENCIES | ||
SHAREHOLDERS' EQUITY | ||
Ordinary shares, $0.0005 par value, 90,000,000 shares authorized, 25,000,000 and 23,000,000 shares issued and outstanding, respectively | 12,500 | 11,500 |
Preferred shares, $0.0005 par value, 10,000,000 shares authorized, 0 shares issued and outstanding | ||
Additional paid-in capital | 15,044,002 | 5,702,663 |
Statutory surplus reserve | 2,064,096 | 2,064,096 |
Retained earnings | 66,623,204 | 53,935,169 |
Accumulated other comprehensive loss | (4,153,813) | (797,781) |
Total shareholders' equity | 79,589,989 | 60,915,647 |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ 85,097,473 | $ 65,679,048 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2020 | Mar. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Ordinary shares, par value | $ 0.0005 | $ 0.0005 |
Ordinary shares, shares authorized | 90,000,000 | 90,000,000 |
Ordinary shares, shares issued | 25,000,000 | 23,000,000 |
Ordinary shares, shares outstanding | 25,000,000 | 23,000,000 |
Preferred stock, par value | $ 0.0005 | $ 0.0005 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Consolidated Statements of Inco
Consolidated Statements of Income and Comprehensive Income - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Income Statement [Abstract] | ||
Revenues | $ 65,061,953 | $ 63,936,185 |
Cost of revenues | (34,642,649) | (31,689,117) |
Gross profit | 30,419,304 | 32,247,068 |
Operating expenses: | ||
Selling and marketing | 9,179,160 | 6,291,228 |
General and administrative | 3,482,459 | 1,951,259 |
Research and development | 2,358,968 | 2,161,708 |
Total operating expenses | 15,020,587 | 10,404,195 |
Operating income | 15,398,717 | 21,842,873 |
Other income (expenses): | ||
Interest income | 74,929 | 42,038 |
Interest expense | (98,086) | (83,549) |
Other income | 156,562 | 103,771 |
Total other income | 133,405 | 62,260 |
Income before income taxes | 15,532,122 | 21,905,133 |
Income tax provision | (2,844,087) | (3,183,154) |
Net income | 12,688,035 | 18,721,979 |
Other comprehensive income : | ||
Foreign currency translation adjustments | (3,356,032) | (2,985,586) |
Comprehensive income | $ 9,332,003 | $ 15,736,393 |
Basic and diluted earnings per ordinary share | ||
Basic and diluted | $ 0.53 | $ 0.81 |
Weighted average number of ordinary shares outstanding | ||
Basic and diluted | 23,843,836 | 23,000,000 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders' Equity - USD ($) | Ordinary shares | Additional paid-in capital | Statutory surplus reserve | Retained earnings | Accumulated other comprehensive income (loss) | Total |
Balance at Mar. 31, 2018 | $ 11,500 | $ 5,075,035 | $ 2,008,019 | $ 35,269,267 | $ 2,187,805 | $ 44,551,626 |
Balance, shares at Mar. 31, 2018 | 23,000,000 | |||||
Capital contributions | 627,628 | 627,628 | ||||
Net income | 18,721,979 | 18,721,979 | ||||
Statutory reserve | 56,077 | (56,077) | ||||
Foreign currency translation adjustment | (2,985,586) | (2,985,586) | ||||
Balance at Mar. 31, 2019 | $ 11,500 | 5,702,663 | 2,064,096 | 53,935,169 | (797,781) | 60,915,647 |
Balance, shares at Mar. 31, 2019 | 23,000,000 | |||||
Ordinary shares issue for cash | $ 1,000 | 9,341,339 | 9,342,339 | |||
Ordinary shares issue for cash, shares | 2,000,000 | |||||
Net income | 12,688,035 | 12,688,035 | ||||
Foreign currency translation adjustment | (3,356,032) | (3,356,032) | ||||
Balance at Mar. 31, 2020 | $ 12,500 | $ 15,044,002 | $ 2,064,096 | $ 66,623,204 | $ (4,153,813) | $ 79,589,989 |
Balance, shares at Mar. 31, 2020 | 25,000,000 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash Flows from Operating Activities: | ||
Net income | $ 12,688,035 | $ 18,721,979 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 690,749 | 699,538 |
Inventory write-downs | 117,753 | |
Loss (gain) on disposal of equipment | 38 | (3,155) |
Changes in operating assets and liabilities: | ||
Accounts receivable | 393,143 | (1,601,202) |
Other receivables | 3,714 | |
Inventories | (276,909) | 148,388 |
Prepaid expenses | 1,525,053 | (6,025,735) |
Other assets | (4,402,208) | (2,257,979) |
Accounts payable | (32,722) | (3,378,079) |
Other payables and accrued liabilities | (559,496) | 61,303 |
Due to related parties | 966,589 | |
Income taxes payable | (332,182) | 176,107 |
Net cash provided by operating activities | 10,777,843 | 6,544,879 |
Cash Flows from Investing Activities: | ||
Purchases of property, plant and equipment | (1,159,355) | (283,100) |
Proceeds from disposal of equipment | 5,942 | |
Net cash used in investing activities | (1,159,355) | (277,158) |
Cash Flows from Financing Activities: | ||
Ordinary shares issue for cash | 9,342,339 | 627,628 |
Proceeds from short-term loans | 3,129,711 | 1,396,382 |
Repayments on short-term loans | (2,067,332) | (1,752,905) |
Net cash provided by financing activities | 10,404,718 | 271,105 |
Effect of exchange rate changes on cash and cash equivalents | (1,169,213) | (622,883) |
Net increase in cash and cash equivalents | 18,853,993 | 5,915,943 |
Cash and cash equivalents at the beginning of year | 14,800,772 | 8,884,829 |
Cash and cash equivalents at the end of year | 33,654,765 | 14,800,772 |
Supplemental disclosures of cash flows information: | ||
Cash paid for income taxes | 3,176,269 | 3,007,047 |
Cash paid for interest expense | $ 98,086 | $ 83,549 |
Organization and Nature of Oper
Organization and Nature of Operations | 12 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND NATURE OF OPERATIONS | NOTE 1 – ORGANIZATION AND NATURE OF OPERATIONS Happiness Biotech Group Limited ("Happiness Biotech" or "the Company") is a holding company incorporated on February 13, 2018 under the laws of the Cayman Islands. The Company has no substantive operations other than holding all of the outstanding share capital of Happiness Biotech Group Limited ("Happiness Hong Kong"). Happiness Hong Kong is a holding company of all of the equity or ownership of Happiness (Nanping) Biotech Co., Ltd ("Happiness Nanping"). Happiness Nanping is a holding company of all of the equity or ownership of Fujian Happiness Biotech Co., Ltd ("Fujian Happiness") a limited liability company established under the laws of the People's Republic of China ("PRC") on November 19, 2004. Fujian Happiness holds all of the equity or ownership of Shunchang Happiness Nutraceutical Co., Ltd ("Shunchang Happiness").Through Fujian Happiness and Shunchang Happiness, the Company is a biotech company that specializes in research, development, production and selling of nutraceutical and dietary supplements made of Ganoderma spore powder and others mainly in China. Reorganization A Reorganization of the legal structure was completed in August 2018. The Reorganization involved the incorporation of Happiness Biotech Group Limited, a Cayman Islands holding company; Happiness Biology Technology Group Limited, a holding company established in Hong Kong, PRC; Happiness (Nanping) Biotech Co., Ltd, a holding company established in Fujian, PRC; and the transfer of 100% ownership of Fujian Happiness from the former shareholders to Happiness Nanping. Happiness Biotech, Happiness Hong Kong and Happiness Nanping are all holding companies and had not commenced operation till August 21, 2018. Prior to the reorganization, Mr. Wang Xuezhu, Chief Executive Officer owns 47.7% ownership of Fujian Happiness. On August 21, 2018, Mr. Wang Xuezhu and other shareholders of Fujian Happiness transferred their 100% ownership interests in Fujian Happiness to Happiness Nanping, which is 100% owned by Happiness Hong Kong. After the reorganization, Happiness Biotech owns 100% equity interests of Fujian Happiness. Mr. Wang Xuezhu, who owns 52.37% ownership of Happiness Biotech, is the ultimate controlling shareholder ("the Controlling Shareholder") of the Company. Since the Company is effectively controlled by the same Controlling Shareholder before and after the reorganization, it is considered under common control. Therefore the above mentioned transactions were accounted for as a recapitalization. The reorganization has been accounted for at historical cost and prepared on the basis as if the aforementioned transactions had become effective as of the beginning of the first period presented in the accompanying financial statements of the Company. On March 4, 2019, the Company subdivided its 50,000 ordinary shares into 100,000,000 ordinary shares. The authorized ordinary shares became 100,000,000 shares and the par value changed from $1 to $0.0005. On the same day, the Company cancelled 77,223,100 ordinary shares and sold additional 223,100 ordinary shares. As of March 31, 2019, the Company has 23,000,000 ordinary shares issued and outstanding. The Company has retrospectively reflected the stock subdivision and cancellation in all periods presented in these financial statements. Initial Public Offering On October 25, 2019, the Company announced the closing of its initial public offering of 2,000,000 ordinary shares, US$0.0005 par value per share ("Ordinary Shares") at an offering price of $5.50 per share for a total of $11,000,000 in gross proceeds. The Company raised total net proceeds of $9,342,339 after deducting underwriting discounts and commissions and offering expenses. In addition, the Company granted to its underwriters, Univest Securities, LLC as the Underwriter Representative, an option for a period of 45 days after the closing of the initial public offering to purchase up to 15% of the total number of the Company's Ordinary Shares to be offered by the Company pursuant to the initial public offering (excluding shares subject to this option), solely for the purpose of covering overallotments, at the initial public offering price less the underwriting discount. During the reporting periods, the Company has two operating subsidiaries in PRC. Details of the Company and its operating subsidiaries are set out below: Name of Entity Date of Incorporation Place of Incorporation Registered % of Principal Activities Fujian Happiness Biotech Co., Ltd ("Fujian Happiness") Incorporated on PRC RMB 25,755,000 100% by Research, development, production and selling of nutraceutical and dietary supplements Shunchang Happiness Nutraceutical Co., Ltd ("Shunchang Happiness") Incorporated on PRC RMB 2,000,000 100% by Research, development, production and selling of edible fungi |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("US GAAP") and have been consistently applied. The accompanying consolidated financial statements include the financial statements of Happiness Biotech Group Limited and its subsidiaries. All inter-company balances and transactions have been eliminated upon consolidation. Use of Estimates In preparing the consolidated financial statements in conformity with US GAAP, management makes 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 revenues and expenses during the reporting period. These estimates are based on information as of the date of the consolidated financial statements. Significant estimates required to be made by management include, but are not limited to, the valuation of accounts receivable and related allowance for doubtful accounts, useful lives of property and equipment and intangible assets, the recoverability of long-lived assets, inventory reserve, and provisions necessary for contingent liabilities. The current economic environment has increased the degrees of uncertainty inherent in those estimates and assumptions, actual results could differ from those estimates. Cash and Cash Equivalents The Company considers all highly liquid investment instruments with an original maturity of three months or less from the date of purchase to be cash equivalents. The Company maintains all bank accounts in the PRC. Cash balances in bank accounts in PRC are not insured by the Federal Deposit Insurance Corporation or other programs. Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are recognized and carried at original invoiced amount less an estimated allowance for uncollectible accounts. The Company determines the adequacy of reserves for doubtful accounts based on individual account analysis and historical collection trends. The Company establishes a provision for doubtful receivables when there is objective evidence that the Company may not be able to collect amounts due. The allowance is based on management's best estimates of specific losses on individual exposures, as well as a provision on historical trends of collections. Based on management of customers' credit and ongoing relationship, management makes conclusions whether any balances outstanding at the end of the period will be deemed uncollectible on an individual basis and on aging analysis basis. The provision is recorded against accounts receivables balances, with a corresponding charge recorded in the consolidated statements of income and comprehensive income. Delinquent account balances are written-off against the allowance for doubtful accounts after management has determined that the likelihood of collection is not probable. Inventories Inventories are stated at the lower of cost or net realizable value. Cost of inventories is determined using the weighted-average method. In addition to cost of raw materials, work in progress and finished goods include direct labor costs and overheads. The Company periodically assesses the recoverability of all inventories to determine whether adjustments are required to record inventories at the lower of cost or market value. Inventories that the Company determines to be obsolete or in excess of forecasted usage are reduced to its estimated realizable value based on assumptions about future demand and market conditions. If actual demand is lower than the forecasted demand, additional inventory write-downs may be required. Property and Equipment Property and equipment are stated at cost. The straight-line depreciation method is used to compute depreciation over the estimated useful lives of the assets, as follows: Useful Lives Buildings 20 years Machinery 10 years Furniture, fixture and electronic equipment 3-10 years Vehicles 4 years Expenditures for maintenance and repairs, which do not materially extend the useful lives of the assets, are charged to expense as incurred. Expenditures for major renewals and betterment which substantially extend the useful life of assets are capitalized. The cost and related accumulated depreciation of assets retired or sold are removed from the respective accounts, and any gain or loss is recognized in the consolidated statements of income and other comprehensive income in other income or expenses. Land Use Rights Under the PRC law, all land in the PRC is owned by the government and cannot be sold to an individual or company. The government grants individuals and companies the right to use parcels of land for specified periods of time. These land use rights are sometimes referred to informally as "ownership". Land use rights are stated at cost, less accumulated amortization. Land use rights are amortized using the straight-line method over the grant period of 50 years. Impairment of Long-lived Assets The Company reviews long-lived assets, including definitive-lived intangible assets, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If the estimated cash flows from the use of the asset and its eventual disposition are below the asset's carrying value, then the asset is deemed to be impaired and written down to its fair value. There were no impairments of these assets as of March 31, 2020 and 2019. Fair Value of Financial Instruments The Financial Accounting Standards Board (FASB) Accounting Standards Codification 820, Fair Value Measurement and Disclosures ● Level 1 - Quoted prices in active markets for identical assets and liabilities. ● Level 2 - Quoted prices in active markets for similar assets and liabilities, or other inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. ● Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs. The Company considers the recorded value of its financial assets and liabilities, which consist primarily of cash and cash equivalents, accounts receivable, other receivable, accounts payable, short-term borrowings, accounts payable, and income taxes payable and to approximate the fair value of the respective assets and liabilities at March 31, 2020 and 2019 based upon the short-term nature of the assets and liabilities. Revenue Recognition The Company generates its revenue mainly from sales of nutraceutical and dietary supplements made of Ganoderma spore powder and others. The Company's revenue recognition policies were in compliance with ASC 605, Revenue Recognition, for the period prior to April 1, 2019. Sales revenue is recognized at the date of shipment to customers when a formal arrangement exists, the price is fixed or determinable, the delivery is completed, no other significant obligations of the Company exist and collectability is reasonably assured. The Company allows its customers to return products within some range. The range was limited to 3% of the customer's yearly payment amount for the year. The transportation fee is borne by the customers in the condition of products return. There were no products return incurred for the years ended March 31, 2020 and 2019. The Company adopted the new guidance of ASC Topic 606, Revenue from Contracts with Customers ("Topic 606"), which supersedes the revenue recognition requirements in ASC Topic 605, Revenue Recognition on April 1, 2019. Topic 606 requires the Company to recognize revenue upon transfer of control of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company sells nutraceutical and dietary supplements to distributors and experience stores. For all sales, the Company requires a signed contract and sales order, which specifies pricing, quantity and product specifications. Under ASC 606, the Company recognizes revenue upon the satisfaction of its performance obligation, which is to transfer the control of the promised products to customers in an amount that reflects the consideration to which the Company expects to be entitled to in exchange for those products, excluding amounts collected on behalf of third parties (e.g. value-added taxes). The transfer of control of the products is satisfied at a point in time, which is the delivery of the products to customers' premises and evidenced by signed customer acknowledgment. The selling price, which is specified in the signed sales orders, is fixed. The Company has unconditional right to receive full payment of the sales price, upon the delivery of the products to customers and the signing of the customer acknowledgment. Customers are required to pay under the customary payment terms, which is generally less than six months. The Company adopted Topic 606 as of April 1, 2019 using the modified retrospective transition method, the Company recognizes the cumulative effect of initially applying the new revenue standard as an adjustment to the opening balance of retained earnings; however, no adjustment was required as a result of adopting the new revenue standard. Results for reporting periods beginning after April 1, 2019 are presented under the new standard. The comparative information has not been restated and continues to be reported under the historic accounting standards in effect for those periods. The Company does not expect any impact to its net income from the adoption of ASU 2014-09 on an ongoing basis. The Company's revenue consists of sales under two contract types, one for traditional revenue model and one for experience store model. All of the Company's revenues from contracts with customers represent products transferred at a point in time as control is transferred to the customer and are generated in PRC. The following table presents an overview of our sales from our product lines for the years ended March 31, 2020 and 2019: For the years ended 2020 2019 Lucidum spore powder products $ 28,233,256 $ 19,886,508 Cordyceps mycelia products 8,854,717 10,883,298 Ejiao solution products 6,266,098 9,583,260 Vitamins and dietary supplements products 6,235,541 8,616,318 American ginseng products 3,921,671 4,912,011 Others 11, 550,670 10,054,790 Total $ 65,061,953 $ 63,936,185 The following table presents an overview of revenues from our sales models for the years ended March 31, 2020 and 2019: For the years ended 2020 2019 Traditional distribution model $ 38,263,069 $ 39,424,118 Regional distributors 29,986,045 32,934,385 Chain drugstores, malls and supermarkets 8,277,024 6,489,733 Experience store model 26,798,884 24,512,067 Total revenues $ 65,061,953 $ 63,936,185 Government Grant Government grants are recognized when received and all the conditions for their receipt have been met. Government grants as compensation for the Company's research and development efforts. For the years ended March 31, 2020 and 2019, the Company recognized government grants of $162,268 and $146,992, respectively, for the government support of the Company's research and development activities and patent applications. The government grants were recorded as other income. Research and Development Costs Research and development activities are directed toward the development of new products as well as improvements in existing processes. These costs, which primarily include salaries, contract services, raw materials, and supplies, are expensed as incurred. Shipping and Handling Costs Shipping and handling costs are expensed when incurred as selling and marketing expense. Shipping and handling costs were $1,869,505 and $1,841,312 for the years ended March 31, 2020 and 2019, respectively. Advertising Costs Advertising costs are expensed as incurred in accordance with ASC 720-35, "Other Expenses-Advertising Costs". Advertising costs were $3,856,921 and $3,217,096 for the years ended March 31, 2020 and 2019, respectively. Income Taxes The Company accounts for current income taxes in accordance with the laws of the relevant tax authorities. Deferred income taxes are recognized when temporary differences exist between the tax bases of assets and liabilities and their reported amounts in the consolidated financial statements. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period including the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. The provisions of ASC 740-10, "Accounting for Uncertainty in Income Taxes", prescribe a more-likely-than-not threshold for consolidated financial statement recognition and measurement of a tax position taken (or expected to be taken) in a tax return. This interpretation also provides guidance on the recognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, accounting for interest and penalties associated with tax positions, and related disclosures. The Company does not believe that there was any uncertain tax position at March 31, 2020 and 2019. To the extent applicable, the Company records interest and penalties as a general and administrative expense. All of the tax returns of the Company and its subsidiaries remain subject to examination by PRC tax authorities for five years from the date of filing. The Company is subject to Chinese tax laws. We are not subject to U.S. tax laws and local state tax laws. Our income and our related entities must be computed in accordance with Chinese and foreign tax laws, as applicable, and we are subject to Chinese tax laws, all of which may be changed in a manner that could adversely affect the amount of distributions to shareholders. There can be no assurance that Income Tax Laws of China will not be changed in a manner that adversely affects shareholders. In particular, any such change could increase the amount of tax payable by us, reducing the amount available to pay dividends to the holders of our ordinary shares. We are a holding company with no material operations of our own. We conduct our operations through our subsidiaries in China. As a result, our ability to pay dividends and to finance any debt we may incur depends upon dividends paid by our subsidiaries. Under applicable PRC regulations, foreign-invested enterprises in China may pay dividends only out of their accumulated profits, if any, determined in accordance with PRC accounting standards and regulations. In addition, a foreign-invested enterprise in China is required to set aside at least 10% of its after-tax profit based on PRC accounting standards each year to its general reserves until the accumulative amount of such reserves reaches 50% of its registered capital. These reserves are not distributable as cash dividends. As of March 31, 2020, our PRC subsidiaries had an aggregate retained earnings of approximately RMB 454.5 million (US$67.6 million) under PRC GAAP. With respect to retained earnings accrued after such date, our Board of Directors may declare dividends after taking into account our operations, earnings, financial condition, cash requirements and availability and other factors as it may deem relevant at such time. Any declaration and payment, as well as the amount, of dividends will be subject to our By-Laws, charter and applicable Chinese and U.S. state and federal laws and regulations, including the approval from the shareholders of each subsidiary which intends to declare such dividends, if applicable. Value-added Tax ("VAT") Value-added taxes ("VAT") collected from customers relating to product sales and remitted to governmental authorities are presented on a net basis. VAT collected from customers is excluded from revenue. The Company is generally subject to the value added tax ("VAT") for selling merchandise. Before May 1, 2018, the applicable VAT rate was 17%, while after May 1, 2018 and before April 1, 2019, the Company is subject to a VAT rate of 16%. After April 1, 2019, the Company is subject to a VAT rate of 13% based on the new Chinese tax law. Earnings per Share The Company computes earnings per share ("EPS") in accordance with ASC 260, "Earnings per Share". ASC 260 requires companies with complex capital structures to present basic and diluted EPS. Basic EPS is measured as net income divided by the weighted average common shares outstanding for the period. Diluted EPS is similar to basic EPS but presents the dilutive effect on a per share basis of potential common shares (e.g., convertible securities, options and warrants) as if they had been converted at the beginning of the periods presented, or issuance date, if later. Potential common shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS. Foreign Currency Translation The Company and its subsidiaries' principal country of operations is the PRC. The financial position and results of its operations are determined using RMB, the local currency, as the functional currency. The Company's financial statements are reported using U.S. Dollars. The consolidated statements of income and comprehensive income and cash flows denominated in foreign currency are translated at the average rate of exchange during the reporting period. Assets and liabilities denominated in foreign currencies at the balance sheet date are translated at the applicable rates of exchange in effect at that date. The equity denominated in the functional currency is translated at the historical rate of exchange at the time of capital contribution. Because cash flows are translated based on the average rate of exchange, amounts related to assets and liabilities reported on the consolidated statements of cash flows will not necessarily agree with changes in the corresponding balances on the consolidated balance sheets. Translation adjustments arising from the use of different exchange rates from period to period are included as a separate component of accumulated other comprehensive income (loss) included in consolidated statements of changes in shareholders' equity. Gains and losses from foreign currency transactions are included in the consolidated statement of income and comprehensive income. The value of RMB against US$ and other currencies may fluctuate and is affected by, among other things, changes in the PRC's political and economic conditions. Any significant revaluation of RMB may materially affect the Company's financial condition in terms of US$ reporting. The following table outlines the currency exchange rates that were used in creating the consolidated financial statements in this report: March 31,2020 March 31,2019 Period-end spot rate US$1=RMB 7.0851 Yuan US$1=RMB 6.7335 Yuan Average rate US$1=RMB 6.9655 Yuan US$1=RMB 6.7317 Yuan Comprehensive Income Comprehensive income includes net income and foreign currency translation adjustments and is reported in the consolidated statements of income and comprehensive income. Concentration of Risks Exchange Rate Risks The Company operates in China, which may give rise to significant foreign currency risks from fluctuations and the degree of volatility of foreign exchange rates between the US$ and the RMB. As at March 31, 2020 and 2019, cash and cash equivalents of $33,430,403 (RMB 236,857,749 Yuan) and $14,800,772 (RMB 99,661,001 Yuan), respectively, is denominated in RMB and is held in PRC. Currency Convertibility Risks Substantially all of the Company's operating activities are transacted in RMB, which is not freely convertible into foreign currencies. All foreign exchange transactions take place either through the People's Bank of China or other banks authorized to buy and sell foreign currencies at the exchange rates quoted by the People's Bank of China. Approval of foreign currency payments by the People's Bank of China or other regulatory institutions requires submitting a payment application form together with other information such as suppliers' invoices, shipping documents and signed contracts. Concentration of Credit Risks Financial instruments that potentially subject the Company to concentration of credit risks consist primarily of cash and cash equivalents and accounts receivable, the balances of which are stated on the consolidated balance sheets which represent the Company's maximum exposure. The Company places its cash and cash equivalents in good credit quality financial institutions in China. Concentration of credit risks with respect to accounts receivables is linked to the concentration of revenue. To manage credit risk, the Company performs ongoing credit evaluations of customers' financial condition. Interest Rate Risks The Company is subject to interest rate risk. Bank interest bearing loans are charged at variable interest rates within the reporting period. The Company is subject to the risk of adverse changes in the interest rates charged by the banks when these loans are refinanced. Risks and Uncertainties The operations of the Company are located in the PRC. Accordingly, the Company's business, financial condition, and results of operations may be influenced by political, economic, and legal environments in the PRC, as well as by the general state of the PRC economy. The Company's results may be adversely affected by changes in the political, regulatory and social conditions in the PRC. Although the Company has not experienced losses from these situations and believes that it is in compliance with existing laws and regulations including its organization and structure disclosed in Note 1, this may not be indicative of future results. Related Parties The Company accounts for related party transactions in accordance with ASC 850 ("Related Party Disclosures"). A party is considered to be related to the Company if the party directly or indirectly or through one or more intermediaries, controls, is controlled by, or is under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. A party which can significantly influence the management or operating policies of the transacting parties or if it has an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests is also a related party. Recent Accounting Pronouncements The Company considers the applicability and impact of all accounting standards updates ("ASUs"). Management periodically reviews new accounting standards that are issued. Recently Adopted Accounting Pronouncements In May 2014, the Financial Accounting Standard Board (the "FASB") issued ASU No. 2014-09, "Revenue from Contracts with Customers (Topic 606)" ("ASU 2014-09"). ASU 2014-09 is a comprehensive revenue recognition model that requires a company to recognize revenue to depict the transfer of goods or services to a customer at an amount that reflects the consideration it expects to receive in exchange for those goods or services. ASU 2014-09 also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfil a contract. In August 2015, the Financial Accounting Standards Board issued ASU No. 2015-14, "Revenue from Contracts with Customers (Topic 606)," which delayed the effective date of ASU 2014-09 by one year. In addition, between March 2016 and December 2016, the Financial Accounting Standards Board issued ASU No. 2016-08, "Revenue from Contracts with Customers - Principal versus Agent Considerations (Reporting revenue gross versus net)" ("ASU 2016-08"), ASU No. 2016-10, "Identifying Performance Obligations and Licensing" ("ASU 2016-10"), ASU No. 2016-12, "Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients" ("ASU 2016-12"), and ASU No. 2016- 20, "Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers" ("ASU 2016-20"). ASU 2016-08, ASU 2016-10, ASU 2016-12 and ASU 2016-20 clarify certain aspects of ASU 2014-09 and provide additional implementation guidance. ASU 2014-09, ASU 2016-08, ASU 2016-10, ASU 2016-12 and ASU 2016-20 (collectively, "ASC 606") became effective for annual reporting periods (including interim periods within those periods) beginning after December 15, 2017 for public companies. The effective date for all other entities is one year later than this (i.e., December 15, 2018). Entities are permitted to adopt ASC 606 using one of two methods: (a) full retrospective adoption, meaning the standard is applied to all periods presented, or (b) modified retrospective adoption, meaning the cumulative effect of applying the new standard is recognized as an adjustment to the opening retained earnings balance. Under ASC 606, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of ASC 606, the entity performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. ASC 606 also impacts certain other areas, such as the accounting for costs to obtain or fulfill a contract. The standard also requires disclosure of the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The Company has adopted the new revenue standard on April 1, 2019, the effective date applicable to non-issuers using the modified retrospective method. The adoption of this guidance did not have material impact on the Company's revenue recognition practices, financial positions, results of operations or cash flows. The new standard requires the Company to provide more robust disclosures than required by previous guidance, including disclosures related to disaggregation of revenue into appropriate categories, performance obligations, and the judgments made in revenue recognition determinations. In January 2017, the FASB issued ASU No. 2017-01, "Business Combinations (Topic 805): Clarifying the Definition of a Business". The amendments in this ASU clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. These amendments take effect for public businesses for fiscal years beginning after December 15, 2017 and interim periods within those periods, and all other entities should apply these amendments for fiscal years beginning after December 15, 2018, and interim periods within annual periods beginning after December 15, 2019. The Company adopted ASU 2017-01 on April 1, 2019 and this update does not have a material impact on the Company's consolidated financial position, results of operations and cash flows. In February 2017, the FASB issued ASU No. 2017-05, "Other Income – Gains and Losses from the De-recognition of Nonfinancial Assets". The amendments in this ASU provides guidance for recognizing gains and losses from the transfer of nonfinancial assets and in-substance nonfinancial assets in contracts with non-customers, unless other specific guidance applies. The standard requires a company to derecognize nonfinancial assets once it transfers control of a distinct nonfinancial asset or distinct in substance nonfinancial asset. Additionally, when a company transfers its controlling interest in a nonfinancial asset, but retains a non-controlling ownership interest, the company is required to measure any non-controlling interest it receives or retains at fair value. The guidance requires companies to recognize a full gain or loss on the transaction. ASU 2017-05 is effective for annual periods beginning after December 15, 2017, including interim periods within that reporting period. The effective date of this guidance coincides with revenue recognition guidance. The Company adopted ASU 2017-05 on April 1, 2019 and this update does not have a material effect on the Company's consolidated financial positions, results of operations or cash flows. In June 2018, FASB issued ASU 2018-07 to expand the scope of ASC Topic 718, Compensation - Stock Compensation, to include share-based payment transactions for acquiring goods and services from nonemployees. The standard is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2018, with early adoption permitted. The Company adopted this Standard effective April 1, 2019; there was no material impact on the Company's financial statements. Recently Issued Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02, "Leases (Topic 842)," which increases lease transparency and comparability among organizations. Under the new standard, lessees will be required to recognize all assets and liabilities arising from leases on the balance sheet, with the exception of leases with a term of 12 months or less, which permits a lessee to make an accounting policy election by class of underlying asset not to recognize lease assets and liabilities. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, and early adoption is permitted. In March 2018, the FASB approved an alternative transition method to the modified retrospective approach, which eliminates the requirement to restate prior period financial statements and requires the cumulative effect of the retrospective allocation to be recorded as an adjustment to the opening balance of retained earnings at the date of adoption. In May 2020, the FASB issued ASC 2020-05 to defer the effective date for non-issuer entities that have not yet issued their financial statements reflecting the adoption of leases; the amended effective date non-issuer entities is for fiscal years beginning after December 15, 2021. The Company as an "emerging growth company" has elected to adopt the new lease standard as of the effective date applicable to non-issuers and will adopt the new lease standard on April 1, 2022 using the modified retrospective method. The modified retrospective approach would not require any transition accounting for leases that expired before the earliest comparative period presented. The Company does not expect this update will have a material impact on the Company's consolidated financial position, results of operations and cash flow. In August 2018, the FASB issued ASU No. 2018-13, "Fair Value Measurement (Topic 820): Disclosure Framework Changes to the Disclosure Requirements for Fair Value Measurement" ("ASU 2018-13"). The amendments in this ASU modify the disclosure requirements on fair value measurements. ASU 2018-13 is effective for public entities for fiscal years beginning after December 15, 2019, with early adoption permitted for any removed or modified disclosures. The removed and modified disclosures will be adopted on a retrospective basis and the new disclosures will be adopted on a prosp |
Accounts Receivable
Accounts Receivable | 12 Months Ended |
Mar. 31, 2020 | |
Receivables [Abstract] | |
ACCOUNTS RECEIVABLE | NOTE 3 – ACCOUNTS RECEIVABLE Accounts receivable consisted of the following as of March 31, 2020 and 2019: As of As of 2020 2019 Accounts receivable, gross $ 30,036,448 $ 32,011,536 Less: allowance for doubtful accounts - - Accounts receivable $ 30,036,448 $ 32,011,536 The Company recorded no allowance for doubtful accounts as of March 31, 2020 and 2019. The Company gives its customers credit period of 180 days and continually assesses the recoverability of uncollected accounts receivable. As of March 31, 2020 and 2019, the balances of the Company's accounts receivable are all due within 1 year. The Company believes the balances of its accounts receivable are fully recoverable as of March 31, 2020. |
Inventories
Inventories | 12 Months Ended |
Mar. 31, 2020 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | NOTE 4 – INVENTORIES Inventories consisted of the following as of March 31, 2020 and 2019: As of As of 2020 2019 Raw materials $ 1,647,667 $ 1,696,353 Work in process - 40,143 Finished goods 381,739 234,239 Total $ 2,029,406 $ 1,970,735 No lower of cost or net realizable value adjustment was recorded as of March 31, 2020 and 2019, respectively. There were no write-downs recognized of inventories for the year ended March 31, 2019. The inventory write-downs for the year ended March 31, 2020 was $117,753. |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 12 Months Ended |
Mar. 31, 2020 | |
Prepaid Expenses [Abstract] | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | NOTE 5 – PREPAID EXPENSES AND OTHER CURRENT ASSETS Prepaid expenses and other current assets consisted of the following as of March 31, 2020 and 2019: As of As of 2020 2019 Prepayments to suppliers $ 3,564,705 $ 5,940,447 Other current assets 699,425 116,769 Total $ 4,264,130 $ 6,057,216 In March 2019, the Company prepaid $5,940,447 (RMB 40 million) to Shandong Guanxian Lingzhibao Biological Co., Ltd. (Guanxian Lingzhibao) to purchase certain materials that the Company uses in its products. The prepayment was an initial deposit for the purchase in order to secure the quantities Guanxian Linzhibao produces. The prepayment the Company made is fully refundable in condition of failure of supply caused by Guanxian Lingzhibao. As of March 31, 2020, $79,069 (approximately RMB 0.6 million) prepayments to Guanxian Lingzhibao remained outstanding. As of March 31, 2020, the prepayments to suppliers also include prepayments of approximately $2.8 million (approximately RMB 19.7 million) to one Southeast Asia trading company for cubilose raw material and approximately $0.72 million (approximately RMB 5.0 million) for lucidum spore powder raw materials. |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Mar. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY, PLANT AND EQUIPMENT | NOTE 6 – PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment consisted of the following as of March 31, 2020 and 2019: As of As of 2020 2019 Buildings $ 9,590,058 $ 9,273,325 Machinery 2,339,879 2,150,738 Furniture, fixture and electronic equipment 163,819 172,552 Vehicles 131,381 68,360 Total property plant and equipment, at cost 12,225,137 11,664,975 Less: accumulated depreciation (4,328,636 ) (3,857,930 ) Property, plant and equipment, net $ 7,896,501 $ 7,807,045 As of March 31, 2020 and 2019, the Company pledged its building with a carrying value of approximately $5.1 million and $3.1 million, respectively, as the collateral for short-term bank loans (see Note 9 Depreciation expense was $674,247 and $682,462 for the years ended March 31, 2020 and 2019, respectively. Depreciation allocated as manufacturing overhead to inventories was $555,636 and $568,017 for the years ended March 31, 2020 and 2019, respectively. |
Land Use Rights
Land Use Rights | 12 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
LAND USE RIGHTS | NOTE 7 – LAND USE RIGHTS As of As of 2020 2019 Land use rights, cost $ 811,194 $ 853,552 Less: accumulated amortization (91,472 ) (79,178 ) Land use rights, net $ 719,722 $ 774,374 As of March 31, 2020 and 2019, the Company pledged its land use right on its land with a carrying value of $719,722 (29,720 square meters) and $95,540 (12,120 square meters), respectively, as the collateral for a short-term bank loans (see Note 9 Amortization expense was $16,502 and $17,076 for the years ended March 31, 2020 and 2019, respectively. Estimated future amortization expense is as follows as of March 31, 2020: Years ending March 31, Amortization 2021 $ 16,502 2022 16,502 2023 16,502 2024 16,502 2025 16,502 Thereafter 637,212 $ 719,722 |
Other Assets
Other Assets | 12 Months Ended |
Mar. 31, 2020 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
OTHER ASSETS | NOTE 8 – OTHER ASSETS Other assets consisted of the following as of March 31, 2020 and 2019: As of As of 2020 2019 Prepayments for advertising or marketing $ 6,200,104 $ 1,856,390 Prepayment of celebrity endorsement fee 296,397 400,980 Total $ 6,496,501 $ 2,257,370 The Company entered into several agreements with 45 exclusive distributors to provide subsidy of $141,141 (RMB 1 million) to each exclusive distributor for advertising and marketing. The prepayments were amortized within the contract periods of 3 years. In order to promote the culture of Chinese medicine and to seek for opportunities to export traditional Chinese herbal products to overseas health care and wellness market, the Company entered into a business development cooperation agreement with a service company located in the U.S. The agreement has a 3-year term for a total of $1,600,000. The service provider will provide market channel and advertisement supports to the Company. In October 2018, the Company paid a celebrity endorsement fee of $445,533 (RMB 3 million). The celebrity endorsement contract is for a period of 5 years. |
Short-term Bank Borrowings
Short-term Bank Borrowings | 12 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
SHORT-TERM BANK BORROWINGS | NOTE 9 – SHORT-TERM BANK BORROWINGS Short-term bank borrowings consisted of the following as of March 31, 2020 and 2019: As of As of 2020 2019 Industrial Bank Co., Ltd $ 987,989 $ 1,039,578 Postal Saving Bank of China 1,044,445 - Total $ 2,032,434 $ 1,039,578 On May 4, 2018, the Company entered into a bank loan agreement with Industrial Bank Co., Ltd to borrow $1,039,578 (RMB 7 million Yuan) as working capital for one year with due date on April 21, 2019. The loan bears a fixed interest rate of 1-year Loan Prime Rate ("LPR") +2.19% on the date of drawing per annum. The loan facility agreement is personally guaranteed by Mr. Xuezhu Wang, Mr. Xianfu Wang, and Mrs. Yanying Lin. Based on guarantee contract the maximum guaranteed amount was RMB 7 million Yuan. The Company also pledged its building and land use rights as collaterals. Based on the pledge agreement, the maximum pledged amount was RMB 17.4 million Yuan. There were no loan guarantee fees paid to the personal guarantors. In April 2019, Fujian Happiness renewed the loan agreement with Industrial Bank Co. Ltd for $987,989 (RMB 7,000,000) bearing interest rate at LPR plus 1.69% per annum, payable monthly. The loan was expired in April 2020. The Company signed three term loans in 2020 to replace this bank loan. On June 24, 2019, the Company entered into a loan facility framework agreement with Postal Saving Bank of China. The agreement allows the Company to access a total borrowing of approximately $3.4 million (RMB 24.4 million Yuan) for short-term loans. The loan facility agreement is valid until June 23, 2025 and subject to renewal. The loan facility agreement is personally guaranteed by Mr. Xuezhu Wang and Happiness Nanping. The Company also pledged its building and land use right as collaterals. Pursuant to the loan facility agreement with Postal Saving Bank of China, which is valid from June 24, 2019 to June 23, 2025, on June 28, 2019 and August 1, 2019, the Company entered into a loan agreement of RMB 4.0 million Yuan and RMB 3.4 million Yuan with Postal Saving Bank of China as working capital for one year, respectively. The loans bear a fixed interest rate of 5.66%; and the Company repaid both loans in full during the fiscal year. Additionally, on January 15, 2020 and February 6, 2020, the Company entered into a loan agreement of $846,848 (RMB 6.0 million) and $197,597 (RMB 1.4 million) short-term loans bearing fixed interest rate of 4.35%, which will be due on January 14, 2021 and February 5, 2021, respectively. The carrying values of the Company's pledged assets to secure short-term borrowings by the Company are as follows: As of As of 2020 2019 Buildings, net $ 5,079,080 $ 3,069,599 Land use rights, net 719,722 95,540 Total $ 5,798,802 $ 3,165,139 For the years ended March 31, 2020 and 2019, interest expense on all short-term bank loans amounted to $98,086 and $83,549, respectively. |
Amounts Due to Related Party
Amounts Due to Related Party | 12 Months Ended |
Mar. 31, 2020 | |
Related Party Transactions [Abstract] | |
AMOUNTS DUE TO RELATED PARTY | NOTE 10 – AMOUNTS DUE TO RELATED PARTY As of March 31, 2020, $ |
Shareholders' Equity
Shareholders' Equity | 12 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
SHAREHOLDERS' EQUITY | NOTE 11 – SHAREHOLDERS' EQUITY Ordinary shares Happiness Biotech was incorporated under the laws of the Cayman Islands on February 9, 2018. The Company issued 50,000 ordinary shares with par value of $1 to exchange for the ownership in Fujian Happiness from the former shareholders to Happiness Nanping. A Reorganization of the legal structure was completed in August 2018. The Reorganization involved the incorporation of Happiness Biotech Group Limited, a Cayman Islands holding company; Happiness Biology Technology Group Limited, a holding company established in Hong Kong, PRC; Happiness (Nanping) Biotech Co., Ltd, a holding company established in Fujian, PRC; and the transfer of 100% ownership of Fujian Happiness from the former shareholders to Happiness Nanping. In May 2018, the Company received $627,628 (RMB 4,000,000 Yuan) from two investors into Fujian Happiness. On March 4, 2019, the Company subdivided its 50,000 ordinary shares into 100,000,000 ordinary shares. The authorized ordinary shares became 100,000,000 shares and the par value changed from $1 to $0.0005. On the same day, the Company cancelled 77,223,100 ordinary shares and sold additional 223,100 ordinary shares. The Company has retrospectively reflected the stock subdivision and cancellation in all periods presented in these financial statements. On October 25, 2019, the Company announced the closing of its initial public offering of 2,000,000 ordinary shares, US$0.0005 par value per share ("Ordinary Shares") at an offering price of $5.50 per share for a total of $11,000,000 in gross proceeds. The Company raised total net proceeds of $9,342,339 after deducting underwriting discounts and commissions and offering expenses. Statutory reserve The Company is required to make appropriations to certain reserve funds, comprising the statutory surplus reserve and the discretionary surplus reserve, based on after-tax net income determined in accordance with generally accepted accounting principles of the PRC ("PRC GAAP"). Appropriations to the statutory surplus reserve are required to be at least 10% of the after-tax net income determined in accordance with PRC GAAP until the reserve is equal to 50% of the entity's registered capital. Appropriations to the discretionary surplus reserve are made at the discretion of the Board of Directors. In 2019, $56,077 was appropriated by Fujian Happiness to the statutory surplus reserve and the statutory reserve reached 50% of its registered capital. In 2020, no statutory surplus was appropriated. The reserved amounts as determined pursuant to PRC statutory laws totalled $2,064,096 as of March 31, 2020 and 2019. Under PRC laws and regulations, statutory surplus reserves are restricted to set-off against losses, expansion of production and operation and increasing registered capital of the respective company, and are not distributable other than upon liquidation. The reserves are not allowed to be transferred to the Company in terms of cash dividends, loans or advances, nor allowed for distribution except under liquidation. Amounts restricted include paid-in capital, additional paid-in capital and statutory surplus reserves of the Company in PRC totalling $7,778,259 as of March 31, 2020 and 2019. As of March 31, 2020, our PRC subsidiaries had an aggregate retained earnings of approximately RMB 454.5 million (US$67.6 million) under PRC GAAP. With respect to retained earnings accrued after such date, our Board of Directors may declare dividends after taking into account our operations, earnings, financial condition, cash requirements and availability and other factors as it may deem relevant at such time. Options In October 2019, the Company granted its underwriters an option for a period of 45 days after the closing of the initial public offering to purchase up to 15% of the total number of the Company's Ordinary Shares to be offered by the Company pursuant to the offering (excluding shares subject to this option), solely for the purpose of covering overallotments, at the initial public offering price less the underwriting discount. These options expired and unexercised in 2020. Number Outstanding Weighted Average Exercise Price Contractual Life in Days Intrinsic Value Options Outstanding as of March 31, 2019 - $ - - $ - Options Exercisable as of March 31, 2019 - $ - - Options granted 300,000 5.12 45 - Options forfeited - - - - Options expired (300,000 ) 5.12 45 - Options Outstanding as of March 31, 2020 - $ - - $ - Options Exercisable as of March 31, 2020 - $ - - $ - Warrants In October 2019, the Company granted to the underwriters warrants to purchase up to a total of 184,000 ordinary shares (equal to 8% of the aggregate number of ordinary shares sold in the offering, if over-allotment shares are placed by the underwriters. Without over-allotment share issuance, a total of 160,000 warrants will be granted). The warrants will be exercisable at an exercise price equal to one hundred twenty percent (120%) of the offering price, in whole or in parts, at any time from issuance and expire five (5) years from the effective date of the offering. The Company's outstanding and exercisable warrants as of March 31, 2020 are presented below: Number Outstanding Weighted Average Exercise Price Contractual Life in Years Intrinsic Value Warrants Outstanding as of March 31, 2019 - $ - - $ - Warrants granted 160,000 $ 6.60 5.0 - Warrants forfeited - - - - Warrants exercised - $ - - - Warrants Outstanding as of March 31, 2020 160,000 $ 6.60 4.6 $ - |
Taxes
Taxes | 12 Months Ended |
Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
TAXES | NOTE 12 – TAXES (a) Corporate Income Taxes ("CIT") The Company was incorporated in the Cayman Islands and is not subject to tax on income or capital gain under the laws of the Cayman Islands. Happiness Hong Kong was incorporated in Hong Kong and is subject to a statutory income tax rate of 16.5%. Under the Law of the People's Republic of China on Enterprise Income Tax ("New EIT Law"), which was effective from January 1, 2008, both domestically-owned enterprises and foreign-invested enterprises are subject to a uniform tax rate of 25% while preferential tax rates, tax holidays and even tax exemption may be granted on case-by-case basis. EIT grants preferential tax treatment to High and New Technology Enterprises ("HNTEs"). Under this preferential tax treatment, HNTEs are entitled to an income tax rate of 15%, subject to a requirement that they re-apply for HNTE status every three years. Fujian Happiness, the Company's main operating entity in PRC, was approved as HNTEs and is entitled to a reduced income tax rate of 15% from December 2019 to December 2022. The Company evaluates each uncertain tax position (including the potential application of interest and penalties) based on the technical merits, and measure the unrecognized benefits associated with the tax positions. As of March 31, 2020 and 2019, the Company did not have any significant unrecognized uncertain tax positions. The Company did not incur any interest and penalties related to potential underpaid income tax expenses for the years ended March 31, 2020 and 2019, respectively, and also did not anticipate any significant increases or decreases in unrecognized tax benefits in the next 12 months from March 31, 2020. The following table reconciles the statutory rate to the Company's effective tax rate: For the years ended 2020 2019 PRC statutory income tax rate 25 % 25 % Effect of PRC preferential tax rate (10 )% (10 )% Effect of other deductible expenses 3.3 % (0.5 )% Total 18.3 % 14.5 % The provision for income tax consisted of the following: For the years ended 2020 2019 Current income tax provision $ 2,844,087 $ 3,183,154 Deferred income tax provision - - Total $ 2,844,087 $ 3,183,154 Deferred income taxes reflect the net effects of temporary difference between the carrying amounts of assets and liabilities for financial statement purposes and the amounts used for income tax purposes. The Company recorded no deferred tax assets and liabilities as of March 31, 2020 and 2019, as there were no material temporary difference between the carrying amounts of assets and liabilities. (b) Taxes Payable The Company's taxes payable as of March 31, 2020 and 2019 consisted of the following: As of As of 2020 2019 Income tax payable $ 568,830 $ 942,160 VAT payable 109,414 522,335 Other tax payables (other payables and accrued liabilities) 18,408 68,655 Total $ 696,652 $ 1,533,150 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 13 – COMMITMENTS AND CONTINGENCIES As of March 31, 2020 and 2019, Company has no significant leases or unused letters of credit. From time to time, the Company is involved in various legal proceedings, claims and other disputes arising from commercial operations, employees, and other matters which, in general, are subject to uncertainties and in which the outcomes are not predictable. The Company determines whether an estimated loss from a contingency should be accrued by assessing whether a loss is deemed probable and can be reasonably estimated. Although the Company can give no assurances about the resolution of pending claims, litigation or other disputes and the effect such outcomes may have on the Company, the Company believes that any ultimate liability resulting from the outcome of such proceedings, to the extent not otherwise provided or covered by insurance, will not have a material adverse effect on our consolidated financial position or results of operations or liquidity. As of March 31, 2020 and 2019, Company has no pending legal proceedings. |
Customer and Supplier Concentra
Customer and Supplier Concentration | 12 Months Ended |
Mar. 31, 2020 | |
Risks and Uncertainties [Abstract] | |
CUSTOMER AND SUPPLIER CONCENTRATION | NOTE 14 – CUSTOMER AND SUPPLIER CONCENTRATION Significant customers and suppliers are those that account for greater than 10% of the Company's revenues and purchases. The Company's sales are made to customers that are located primarily in China. For the years ended March 31, 2020 and 2019, no individual customer accounted for more than 10% of the Company's total revenues. As of March 31, 2020 and 2019, no individual customer accounted for more than 10% of the total outstanding accounts receivable balance. For the years ended March 31, 2020 and 2019, the Company purchased a substantial portion of raw materials from one third-party supplier (16.67% of total raw materials purchase of the year ended March 31, 2020). As of March 31, 2020, the amounts due to this vendor was $-0-. For the year ended March 31, 2019, the Company purchased a substantial portion of raw materials from two third-party suppliers (12.7% and 11.7% of total purchase of the year ended March 31, 2019, respectively). As of March 31, 2019, the amounts due to the two vendors were $384,547 and $129,984, respectively. The Company believes there are numerous other suppliers that could be substituted should this supplier become unavailable or non-competitive. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Mar. 31, 2020 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 15 – SUBSEQUENT EVENTS In April 2020, Fujian Happiness Medical Equipment Co. Ltd ("Happiness Medical") was set up by Fujian Happiness Biotech Co., Ltd, which holds 51% of equity interest in Happiness Medical and Mr. ZhiHui Zhen who holds 49%. The registered capital of Happiness Medical is RMB 10 million. Happiness Medical started to produce facial masks at first and then expanded business scopes to include the manufacture and sale of face shields, glass shields, medical gloves and sanitary products. As of the date of this report, the Company has contributed RMB 500,000 to the Happiness Medical. On April 19, 2019, the Company entered into a bank loan agreement with Industrial Bank Co., Ltd to borrow RMB 7 million Yuan as working capital for one year with due date in April 2020. In April 2020, Fujian Happiness renewed this RMB 7 million Yuan loan with three separate loan agreements with Industrial Bank Co. Ltd for a total amount of RMB 7,000,000 bearing interest rate at LPR plus 1.45% per annum, payable monthly. Mr. Xuezhu Wang, Mr. Xianfu Wang and Ms. Yanying Lin personally guaranteed these loans. All term loans have a one-year life and are due in April 2021. On April 7, 2020, Fujian Happiness Biotech Co., Ltd entered into an agreement due in May 2021 with Postal Saving Bank of China that provided for a RMB 3,000,000 one-year term loan bearing interest at LPR Index plus 0.2% per annum (LPR 4.2 % in April 2020) payable monthly, with a revolving credit facility clause in this contract. Fujian Happiness Biotech Co., Ltd withdrew proceeds of a RMB 1.7 million under this credit facility on April 7, 2020 and may drawdown another RMB 1.3 million within loan tenor period. COVID-19 Pandemic The outbreak of COVID-19 began in January 2020 and was quickly declared as a Public Health Emergency of International Concern and subsequently a pandemic by the World Health Organization. A series of prevention and control measures including quarantines, travel restrictions, and the temporary closure of facilities were implemented across the country. The Company was impacted by the COVID-19 pandemic in many ways, including the plump of closures of experience stores, diving sales by distribution channels, and shut down or partly shut down of production facilities for around three months. As a result, revenue dropped by approximately 50% for the three months ended on March 31, 2020, compared with the revenue of the same period in 2019. In addition, the planting and harvesting of Cordyceps mylitaris ceased for three months, so an inventory loss was recorded. Despite the fact that China has largely brought the pandemic under control, there is still a high degree of uncertainty as to how the pandemic will evolve going forward. A new outbreak in China could cause new disruptions of our production, distribution and sales, and have an adverse impact on our business, financial condition and results of operations for the remainder of the fiscal year ending March 31, 2021, which cannot be reasonably estimated at the current stage. We will regularly assess its business conditions and adopt measures to mitigate any new impact of the ongoing pandemic. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 12 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("US GAAP") and have been consistently applied. The accompanying consolidated financial statements include the financial statements of Happiness Biotech Group Limited and its subsidiaries. All inter-company balances and transactions have been eliminated upon consolidation. |
Use of Estimates | Use of Estimates In preparing the consolidated financial statements in conformity with US GAAP, management makes 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 revenues and expenses during the reporting period. These estimates are based on information as of the date of the consolidated financial statements. Significant estimates required to be made by management include, but are not limited to, the valuation of accounts receivable and related allowance for doubtful accounts, useful lives of property and equipment and intangible assets, the recoverability of long-lived assets, inventory reserve, and provisions necessary for contingent liabilities. The current economic environment has increased the degrees of uncertainty inherent in those estimates and assumptions, actual results could differ from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investment instruments with an original maturity of three months or less from the date of purchase to be cash equivalents. The Company maintains all bank accounts in the PRC. Cash balances in bank accounts in PRC are not insured by the Federal Deposit Insurance Corporation or other programs. |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are recognized and carried at original invoiced amount less an estimated allowance for uncollectible accounts. The Company determines the adequacy of reserves for doubtful accounts based on individual account analysis and historical collection trends. The Company establishes a provision for doubtful receivables when there is objective evidence that the Company may not be able to collect amounts due. The allowance is based on management's best estimates of specific losses on individual exposures, as well as a provision on historical trends of collections. Based on management of customers' credit and ongoing relationship, management makes conclusions whether any balances outstanding at the end of the period will be deemed uncollectible on an individual basis and on aging analysis basis. The provision is recorded against accounts receivables balances, with a corresponding charge recorded in the consolidated statements of income and comprehensive income. Delinquent account balances are written-off against the allowance for doubtful accounts after management has determined that the likelihood of collection is not probable. |
Inventories | Inventories Inventories are stated at the lower of cost or net realizable value. Cost of inventories is determined using the weighted-average method. In addition to cost of raw materials, work in progress and finished goods include direct labor costs and overheads. The Company periodically assesses the recoverability of all inventories to determine whether adjustments are required to record inventories at the lower of cost or market value. Inventories that the Company determines to be obsolete or in excess of forecasted usage are reduced to its estimated realizable value based on assumptions about future demand and market conditions. If actual demand is lower than the forecasted demand, additional inventory write-downs may be required. |
Property and Equipment | Property and Equipment Property and equipment are stated at cost. The straight-line depreciation method is used to compute depreciation over the estimated useful lives of the assets, as follows: Useful Lives Buildings 20 years Machinery 10 years Furniture, fixture and electronic equipment 3-10 years Vehicles 4 years Expenditures for maintenance and repairs, which do not materially extend the useful lives of the assets, are charged to expense as incurred. Expenditures for major renewals and betterment which substantially extend the useful life of assets are capitalized. The cost and related accumulated depreciation of assets retired or sold are removed from the respective accounts, and any gain or loss is recognized in the consolidated statements of income and other comprehensive income in other income or expenses. |
Land Use Rights | Land Use Rights Under the PRC law, all land in the PRC is owned by the government and cannot be sold to an individual or company. The government grants individuals and companies the right to use parcels of land for specified periods of time. These land use rights are sometimes referred to informally as "ownership". Land use rights are stated at cost, less accumulated amortization. Land use rights are amortized using the straight-line method over the grant period of 50 years |
Impairment of Long-lived Assets | Impairment of Long-lived Assets The Company reviews long-lived assets, including definitive-lived intangible assets, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If the estimated cash flows from the use of the asset and its eventual disposition are below the asset's carrying value, then the asset is deemed to be impaired and written down to its fair value. There were no impairments of these assets as of March 31, 2020 and 2019 |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Financial Accounting Standards Board (FASB) Accounting Standards Codification 820, Fair Value Measurement and Disclosures ● Level 1 - Quoted prices in active markets for identical assets and liabilities. ● Level 2 - Quoted prices in active markets for similar assets and liabilities, or other inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. ● Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs. The Company considers the recorded value of its financial assets and liabilities, which consist primarily of cash and cash equivalents, accounts receivable, other receivable, accounts payable, short-term borrowings, accounts payable, and income taxes payable and to approximate the fair value of the respective assets and liabilities at March 31, 2020 and 2019 based upon the short-term nature of the assets and liabilities. |
Revenue Recognition | Revenue Recognition The Company generates its revenue mainly from sales of nutraceutical and dietary supplements made of Ganoderma spore powder and others. The Company's revenue recognition policies were in compliance with ASC 605, Revenue Recognition, for the period prior to April 1, 2019. Sales revenue is recognized at the date of shipment to customers when a formal arrangement exists, the price is fixed or determinable, the delivery is completed, no other significant obligations of the Company exist and collectability is reasonably assured. The Company allows its customers to return products within some range. The range was limited to 3% of the customer's yearly payment amount for the year. The transportation fee is borne by the customers in the condition of products return. There were no products return incurred for the years ended March 31, 2020 and 2019. The Company adopted the new guidance of ASC Topic 606, Revenue from Contracts with Customers ("Topic 606"), which supersedes the revenue recognition requirements in ASC Topic 605, Revenue Recognition on April 1, 2019. Topic 606 requires the Company to recognize revenue upon transfer of control of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company sells nutraceutical and dietary supplements to distributors and experience stores. For all sales, the Company requires a signed contract and sales order, which specifies pricing, quantity and product specifications. Under ASC 606, the Company recognizes revenue upon the satisfaction of its performance obligation, which is to transfer the control of the promised products to customers in an amount that reflects the consideration to which the Company expects to be entitled to in exchange for those products, excluding amounts collected on behalf of third parties (e.g. value-added taxes). The transfer of control of the products is satisfied at a point in time, which is the delivery of the products to customers' premises and evidenced by signed customer acknowledgment. The selling price, which is specified in the signed sales orders, is fixed. The Company has unconditional right to receive full payment of the sales price, upon the delivery of the products to customers and the signing of the customer acknowledgment. Customers are required to pay under the customary payment terms, which is generally less than six months. The Company adopted Topic 606 as of April 1, 2019 using the modified retrospective transition method, the Company recognizes the cumulative effect of initially applying the new revenue standard as an adjustment to the opening balance of retained earnings; however, no adjustment was required as a result of adopting the new revenue standard. Results for reporting periods beginning after April 1, 2019 are presented under the new standard. The comparative information has not been restated and continues to be reported under the historic accounting standards in effect for those periods. The Company does not expect any impact to its net income from the adoption of ASU 2014-09 on an ongoing basis. The Company's revenue consists of sales under two contract types, one for traditional revenue model and one for experience store model. All of the Company's revenues from contracts with customers represent products transferred at a point in time as control is transferred to the customer and are generated in PRC. The following table presents an overview of our sales from our product lines for the years ended March 31, 2020 and 2019: For the years ended 2020 2019 Lucidum spore powder products $ 28,233,256 $ 19,886,508 Cordyceps mycelia products 8,854,717 10,883,298 Ejiao solution products 6,266,098 9,583,260 Vitamins and dietary supplements products 6,235,541 8,616,318 American ginseng products 3,921,671 4,912,011 Others 11, 550,670 10,054,790 Total $ 65,061,953 $ 63,936,185 The following table presents an overview of revenues from our sales models for the years ended March 31, 2020 and 2019: For the years ended 2020 2019 Traditional distribution model $ 38,263,069 $ 39,424,118 Regional distributors 29,986,045 32,934,385 Chain drugstores, malls and supermarkets 8,277,024 6,489,733 Experience store model 26,798,884 24,512,067 Total revenues $ 65,061,953 $ 63,936,185 |
Government Grant | Government Grant Government grants are recognized when received and all the conditions for their receipt have been met. Government grants as compensation for the Company's research and development efforts. For the years ended March 31, 2020 and 2019, the Company recognized government grants of $162,268 and $146,992, respectively, for the government support of the Company's research and development activities and patent applications. The government grants were recorded as other income. |
Research and Development Costs | Research and Development Costs Research and development activities are directed toward the development of new products as well as improvements in existing processes. These costs, which primarily include salaries, contract services, raw materials, and supplies, are expensed as incurred. |
Shipping and Handling Costs | Shipping and Handling Costs Shipping and handling costs are expensed when incurred as selling and marketing expense. Shipping and handling costs were $1,869,505 and $1,841,312 for the years ended March 31, 2020 and 2019, respectively. |
Advertising Costs | Advertising Costs Advertising costs are expensed as incurred in accordance with ASC 720-35, "Other Expenses-Advertising Costs". Advertising costs were $3,856,921 and $3,217,096 for the years ended March 31, 2020 and 2019, respectively. |
Income Taxes | Income Taxes The Company accounts for current income taxes in accordance with the laws of the relevant tax authorities. Deferred income taxes are recognized when temporary differences exist between the tax bases of assets and liabilities and their reported amounts in the consolidated financial statements. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period including the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. The provisions of ASC 740-10, "Accounting for Uncertainty in Income Taxes", prescribe a more-likely-than-not threshold for consolidated financial statement recognition and measurement of a tax position taken (or expected to be taken) in a tax return. This interpretation also provides guidance on the recognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, accounting for interest and penalties associated with tax positions, and related disclosures. The Company does not believe that there was any uncertain tax position at March 31, 2020 and 2019. To the extent applicable, the Company records interest and penalties as a general and administrative expense. All of the tax returns of the Company and its subsidiaries remain subject to examination by PRC tax authorities for five years from the date of filing. The Company is subject to Chinese tax laws. We are not subject to U.S. tax laws and local state tax laws. Our income and our related entities must be computed in accordance with Chinese and foreign tax laws, as applicable, and we are subject to Chinese tax laws, all of which may be changed in a manner that could adversely affect the amount of distributions to shareholders. There can be no assurance that Income Tax Laws of China will not be changed in a manner that adversely affects shareholders. In particular, any such change could increase the amount of tax payable by us, reducing the amount available to pay dividends to the holders of our ordinary shares. We are a holding company with no material operations of our own. We conduct our operations through our subsidiaries in China. As a result, our ability to pay dividends and to finance any debt we may incur depends upon dividends paid by our subsidiaries. Under applicable PRC regulations, foreign-invested enterprises in China may pay dividends only out of their accumulated profits, if any, determined in accordance with PRC accounting standards and regulations. In addition, a foreign-invested enterprise in China is required to set aside at least 10% of its after-tax profit based on PRC accounting standards each year to its general reserves until the accumulative amount of such reserves reaches 50% of its registered capital. These reserves are not distributable as cash dividends. As of March 31, 2020, our PRC subsidiaries had an aggregate retained earnings of approximately RMB 454.5 million (US$67.6 million) under PRC GAAP. With respect to retained earnings accrued after such date, our Board of Directors may declare dividends after taking into account our operations, earnings, financial condition, cash requirements and availability and other factors as it may deem relevant at such time. Any declaration and payment, as well as the amount, of dividends will be subject to our By-Laws, charter and applicable Chinese and U.S. state and federal laws and regulations, including the approval from the shareholders of each subsidiary which intends to declare such dividends, if applicable. |
Value-added Tax ("VAT") | Value-added Tax ("VAT") Value-added taxes ("VAT") collected from customers relating to product sales and remitted to governmental authorities are presented on a net basis. VAT collected from customers is excluded from revenue. The Company is generally subject to the value added tax ("VAT") for selling merchandise. Before May 1, 2018, the applicable VAT rate was 17%, while after May 1, 2018 and before April 1, 2019, the Company is subject to a VAT rate of 16%. After April 1, 2019, the Company is subject to a VAT rate of 13% based on the new Chinese tax law. |
Earnings per Share | Earnings per Share The Company computes earnings per share ("EPS") in accordance with ASC 260, "Earnings per Share". ASC 260 requires companies with complex capital structures to present basic and diluted EPS. Basic EPS is measured as net income divided by the weighted average common shares outstanding for the period. Diluted EPS is similar to basic EPS but presents the dilutive effect on a per share basis of potential common shares (e.g., convertible securities, options and warrants) as if they had been converted at the beginning of the periods presented, or issuance date, if later. Potential common shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS. |
Foreign Currency Translation | Foreign Currency Translation The Company and its subsidiaries' principal country of operations is the PRC. The financial position and results of its operations are determined using RMB, the local currency, as the functional currency. The Company's financial statements are reported using U.S. Dollars. The consolidated statements of income and comprehensive income and cash flows denominated in foreign currency are translated at the average rate of exchange during the reporting period. Assets and liabilities denominated in foreign currencies at the balance sheet date are translated at the applicable rates of exchange in effect at that date. The equity denominated in the functional currency is translated at the historical rate of exchange at the time of capital contribution. Because cash flows are translated based on the average rate of exchange, amounts related to assets and liabilities reported on the consolidated statements of cash flows will not necessarily agree with changes in the corresponding balances on the consolidated balance sheets. Translation adjustments arising from the use of different exchange rates from period to period are included as a separate component of accumulated other comprehensive income (loss) included in consolidated statements of changes in shareholders' equity. Gains and losses from foreign currency transactions are included in the consolidated statement of income and comprehensive income. The value of RMB against US$ and other currencies may fluctuate and is affected by, among other things, changes in the PRC's political and economic conditions. Any significant revaluation of RMB may materially affect the Company's financial condition in terms of US$ reporting. The following table outlines the currency exchange rates that were used in creating the consolidated financial statements in this report: March 31,2020 March 31,2019 Period-end spot rate US$1=RMB 7.0851 Yuan US$1=RMB 6.7335 Yuan Average rate US$1=RMB 6.9655 Yuan US$1=RMB 6.7317 Yuan |
Comprehensive Income | Comprehensive Income Comprehensive income includes net income and foreign currency translation adjustments and is reported in the consolidated statements of income and comprehensive income. |
Concentration of Risks | Concentration of Risks Exchange Rate Risks The Company operates in China, which may give rise to significant foreign currency risks from fluctuations and the degree of volatility of foreign exchange rates between the US$ and the RMB. As at March 31, 2020 and 2019, cash and cash equivalents of $33,430,403 (RMB 236,857,749 Yuan) and $14,800,772 (RMB 99,661,001 Yuan), respectively, is denominated in RMB and is held in PRC. Currency Convertibility Risks Substantially all of the Company's operating activities are transacted in RMB, which is not freely convertible into foreign currencies. All foreign exchange transactions take place either through the People's Bank of China or other banks authorized to buy and sell foreign currencies at the exchange rates quoted by the People's Bank of China. Approval of foreign currency payments by the People's Bank of China or other regulatory institutions requires submitting a payment application form together with other information such as suppliers' invoices, shipping documents and signed contracts. Concentration of Credit Risks Financial instruments that potentially subject the Company to concentration of credit risks consist primarily of cash and cash equivalents and accounts receivable, the balances of which are stated on the consolidated balance sheets which represent the Company's maximum exposure. The Company places its cash and cash equivalents in good credit quality financial institutions in China. Concentration of credit risks with respect to accounts receivables is linked to the concentration of revenue. To manage credit risk, the Company performs ongoing credit evaluations of customers' financial condition. Interest Rate Risks The Company is subject to interest rate risk. Bank interest bearing loans are charged at variable interest rates within the reporting period. The Company is subject to the risk of adverse changes in the interest rates charged by the banks when these loans are refinanced. |
Risks and Uncertainties | Risks and Uncertainties The operations of the Company are located in the PRC. Accordingly, the Company's business, financial condition, and results of operations may be influenced by political, economic, and legal environments in the PRC, as well as by the general state of the PRC economy. The Company's results may be adversely affected by changes in the political, regulatory and social conditions in the PRC. Although the Company has not experienced losses from these situations and believes that it is in compliance with existing laws and regulations including its organization and structure disclosed in Note 1, this may not be indicative of future results. |
Related Parties | Related Parties The Company accounts for related party transactions in accordance with ASC 850 ("Related Party Disclosures"). A party is considered to be related to the Company if the party directly or indirectly or through one or more intermediaries, controls, is controlled by, or is under common control with the Company. Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. A party which can significantly influence the management or operating policies of the transacting parties or if it has an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests is also a related party. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements The Company considers the applicability and impact of all accounting standards updates ("ASUs"). Management periodically reviews new accounting standards that are issued. Recently Adopted Accounting Pronouncements In May 2014, the Financial Accounting Standard Board (the "FASB") issued ASU No. 2014-09, "Revenue from Contracts with Customers (Topic 606)" ("ASU 2014-09"). ASU 2014-09 is a comprehensive revenue recognition model that requires a company to recognize revenue to depict the transfer of goods or services to a customer at an amount that reflects the consideration it expects to receive in exchange for those goods or services. ASU 2014-09 also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfil a contract. In August 2015, the Financial Accounting Standards Board issued ASU No. 2015-14, "Revenue from Contracts with Customers (Topic 606)," which delayed the effective date of ASU 2014-09 by one year. In addition, between March 2016 and December 2016, the Financial Accounting Standards Board issued ASU No. 2016-08, "Revenue from Contracts with Customers - Principal versus Agent Considerations (Reporting revenue gross versus net)" ("ASU 2016-08"), ASU No. 2016-10, "Identifying Performance Obligations and Licensing" ("ASU 2016-10"), ASU No. 2016-12, "Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients" ("ASU 2016-12"), and ASU No. 2016- 20, "Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers" ("ASU 2016-20"). ASU 2016-08, ASU 2016-10, ASU 2016-12 and ASU 2016-20 clarify certain aspects of ASU 2014-09 and provide additional implementation guidance. ASU 2014-09, ASU 2016-08, ASU 2016-10, ASU 2016-12 and ASU 2016-20 (collectively, "ASC 606") became effective for annual reporting periods (including interim periods within those periods) beginning after December 15, 2017 for public companies. The effective date for all other entities is one year later than this (i.e., December 15, 2018). Entities are permitted to adopt ASC 606 using one of two methods: (a) full retrospective adoption, meaning the standard is applied to all periods presented, or (b) modified retrospective adoption, meaning the cumulative effect of applying the new standard is recognized as an adjustment to the opening retained earnings balance. Under ASC 606, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of ASC 606, the entity performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. ASC 606 also impacts certain other areas, such as the accounting for costs to obtain or fulfill a contract. The standard also requires disclosure of the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The Company has adopted the new revenue standard on April 1, 2019, the effective date applicable to non-issuers using the modified retrospective method. The adoption of this guidance did not have material impact on the Company's revenue recognition practices, financial positions, results of operations or cash flows. The new standard requires the Company to provide more robust disclosures than required by previous guidance, including disclosures related to disaggregation of revenue into appropriate categories, performance obligations, and the judgments made in revenue recognition determinations. In January 2017, the FASB issued ASU No. 2017-01, "Business Combinations (Topic 805): Clarifying the Definition of a Business". The amendments in this ASU clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. These amendments take effect for public businesses for fiscal years beginning after December 15, 2017 and interim periods within those periods, and all other entities should apply these amendments for fiscal years beginning after December 15, 2018, and interim periods within annual periods beginning after December 15, 2019. The Company adopted ASU 2017-01 on April 1, 2019 and this update does not have a material impact on the Company's consolidated financial position, results of operations and cash flows. In February 2017, the FASB issued ASU No. 2017-05, "Other Income – Gains and Losses from the De-recognition of Nonfinancial Assets". The amendments in this ASU provides guidance for recognizing gains and losses from the transfer of nonfinancial assets and in-substance nonfinancial assets in contracts with non-customers, unless other specific guidance applies. The standard requires a company to derecognize nonfinancial assets once it transfers control of a distinct nonfinancial asset or distinct in substance nonfinancial asset. Additionally, when a company transfers its controlling interest in a nonfinancial asset, but retains a non-controlling ownership interest, the company is required to measure any non-controlling interest it receives or retains at fair value. The guidance requires companies to recognize a full gain or loss on the transaction. ASU 2017-05 is effective for annual periods beginning after December 15, 2017, including interim periods within that reporting period. The effective date of this guidance coincides with revenue recognition guidance. The Company adopted ASU 2017-05 on April 1, 2019 and this update does not have a material effect on the Company's consolidated financial positions, results of operations or cash flows. In June 2018, FASB issued ASU 2018-07 to expand the scope of ASC Topic 718, Compensation - Stock Compensation, to include share-based payment transactions for acquiring goods and services from nonemployees. The standard is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2018, with early adoption permitted. The Company adopted this Standard effective April 1, 2019; there was no material impact on the Company's financial statements. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02, "Leases (Topic 842)," which increases lease transparency and comparability among organizations. Under the new standard, lessees will be required to recognize all assets and liabilities arising from leases on the balance sheet, with the exception of leases with a term of 12 months or less, which permits a lessee to make an accounting policy election by class of underlying asset not to recognize lease assets and liabilities. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, and early adoption is permitted. In March 2018, the FASB approved an alternative transition method to the modified retrospective approach, which eliminates the requirement to restate prior period financial statements and requires the cumulative effect of the retrospective allocation to be recorded as an adjustment to the opening balance of retained earnings at the date of adoption. In May 2020, the FASB issued ASC 2020-05 to defer the effective date for non-issuer entities that have not yet issued their financial statements reflecting the adoption of leases; the amended effective date non-issuer entities is for fiscal years beginning after December 15, 2021. The Company as an "emerging growth company" has elected to adopt the new lease standard as of the effective date applicable to non-issuers and will adopt the new lease standard on April 1, 2022 using the modified retrospective method. The modified retrospective approach would not require any transition accounting for leases that expired before the earliest comparative period presented. The Company does not expect this update will have a material impact on the Company's consolidated financial position, results of operations and cash flow. In August 2018, the FASB issued ASU No. 2018-13, "Fair Value Measurement (Topic 820): Disclosure Framework Changes to the Disclosure Requirements for Fair Value Measurement" ("ASU 2018-13"). The amendments in this ASU modify the disclosure requirements on fair value measurements. ASU 2018-13 is effective for public entities for fiscal years beginning after December 15, 2019, with early adoption permitted for any removed or modified disclosures. The removed and modified disclosures will be adopted on a retrospective basis and the new disclosures will be adopted on a prospective basis. The Company does not plan to early adopt ASU 2018-13 or expect this update will have a material impact on the Company's consolidated financial position, results of operations and cash flows. In November 2018, FASB issued ASU 2018-18, Collaborative Arrangements (Topic 808): Clarifying the Interaction between Topic 808 and Topic 606, which, among other things, provides guidance on how to assess whether certain collaborative arrangement transactions should be accounted for under Topic 606. The amendments in this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019, with early adoption permitted. The Company is in the process of evaluating the impact the standard will have on its financial statements. |
Organization and Nature of Op_2
Organization and Nature of Operations (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of operating subsidiaries | Name of Entity Date of Incorporation Place of Incorporation Registered % of Principal Activities Fujian Happiness Biotech Co., Ltd ("Fujian Happiness") Incorporated on PRC RMB 25,755,000 100% by Research, development, production and selling of nutraceutical and dietary supplements Shunchang Happiness Nutraceutical Co., Ltd ("Shunchang Happiness") Incorporated on PRC RMB 2,000,000 100% by Research, development, production and selling of edible fungi |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Schedule of property and equipment net | Useful Lives Buildings 20 years Machinery 10 years Furniture, fixture and electronic equipment 3-10 years Vehicles 4 years |
Schedule of our sales from our product lines | For the years ended 2020 2019 Lucidum spore powder products $ 28,233,256 $ 19,886,508 Cordyceps mycelia products 8,854,717 10,883,298 Ejiao solution products 6,266,098 9,583,260 Vitamins and dietary supplements products 6,235,541 8,616,318 American ginseng products 3,921,671 4,912,011 Others 11, 550,670 10,054,790 Total $ 65,061,953 $ 63,936,185 |
Schedule of of revenues from our sales models | For the years ended 2020 2019 Traditional distribution model $ 38,263,069 $ 39,424,118 Regional distributors 29,986,045 32,934,385 Chain drugstores, malls and supermarkets 8,277,024 6,489,733 Experience store model 26,798,884 24,512,067 Total revenues $ 65,061,953 $ 63,936,185 |
Schedule of foreign currency translation | March 31,2020 March 31,2019 Period-end spot rate US$1=RMB 7.0851 Yuan US$1=RMB 6.7335 Yuan Average rate US$1=RMB 6.9655 Yuan US$1=RMB 6.7317 Yuan |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
Receivables [Abstract] | |
Schedule of Accounts Receivable | As of As of 2020 2019 Accounts receivable, gross $ 30,036,448 $ 32,011,536 Less: allowance for doubtful accounts - - Accounts receivable $ 30,036,448 $ 32,011,536 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventorie | As of As of 2020 2019 Raw materials $ 1,647,667 $ 1,696,353 Work in process - 40,143 Finished goods 381,739 234,239 Total $ 2,029,406 $ 1,970,735 |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
Prepaid Expenses And Other Current Assets | |
Schedule of Prepaid Expenses and Other Current Assets | As of As of 2020 2019 Prepayments to suppliers $ 3,564,705 $ 5,940,447 Other current assets 699,425 116,769 Total $ 4,264,130 $ 6,057,216 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property, plant and equipment | As of As of 2020 2019 Buildings $ 9,590,058 $ 9,273,325 Machinery 2,339,879 2,150,738 Furniture, fixture and electronic equipment 163,819 172,552 Vehicles 131,381 68,360 Total property plant and equipment, at cost 12,225,137 11,664,975 Less: accumulated depreciation (4,328,636 ) (3,857,930 ) Property, plant and equipment, net $ 7,896,501 $ 7,807,045 |
Land Use Rights (Tables)
Land Use Rights (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of land use rights | As of As of 2020 2019 Land use rights, cost $ 811,194 $ 853,552 Less: accumulated amortization (91,472 ) (79,178 ) Land use rights, net $ 719,722 $ 774,374 |
Schedule of estimated future amortization expense | Years ending March 31, Amortization 2021 $ 16,502 2022 16,502 2023 16,502 2024 16,502 2025 16,502 Thereafter 637,212 $ 719,722 |
Other Assets (Tables)
Other Assets (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of other assets | As of As of 2020 2019 Prepayments for advertising or marketing $ 6,200,104 $ 1,856,390 Prepayment of celebrity endorsement fee 296,397 400,980 Total $ 6,496,501 $ 2,257,370 |
Short-term Bank Borrowings (Tab
Short-term Bank Borrowings (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of short-term bank borrowings | As of As of 2020 2019 Industrial Bank Co., Ltd $ 987,989 $ 1,039,578 Postal Saving Bank of China 1,044,445 - Total $ 2,032,434 $ 1,039,578 |
Schedule of secure short term borrowings | As of As of 2020 2019 Buildings, net $ 5,079,080 $ 3,069,599 Land use rights, net 719,722 95,540 Total $ 5,798,802 $ 3,165,139 |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Schedule of options outstanding | Number Outstanding Weighted Average Exercise Price Contractual Life in Days Intrinsic Value Options Outstanding as of March 31, 2019 - $ - - $ - Options Exercisable as of March 31, 2019 - $ - - Options granted 300,000 5.12 45 - Options forfeited - - - - Options expired (300,000 ) 5.12 45 - Options Outstanding as of March 31, 2020 - $ - - $ - Options Exercisable as of March 31, 2020 - $ - - $ - |
Schedule of outstanding options granted | Number Outstanding Weighted Average Exercise Price Contractual Life in Years Intrinsic Value Warrants Outstanding as of March 31, 2019 - $ - - $ - Warrants granted 160,000 $ 6.60 5.0 - Warrants forfeited - - - - Warrants exercised - $ - - - Warrants Outstanding as of March 31, 2020 160,000 $ 6.60 4.6 $ - |
Taxes (Tables)
Taxes (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Schedule of taxes reconciles rate | For the years ended 2020 2019 PRC statutory income tax rate 25 % 25 % Effect of PRC preferential tax rate (10 )% (10 )% Effect of other deductible expenses 3.3 % (0.5 )% Total 18.3 % 14.5 % |
Schedule of income tax | For the years ended 2020 2019 Current income tax provision $ 2,844,087 $ 3,183,154 Deferred income tax provision - - Total $ 2,844,087 $ 3,183,154 |
Schedule of taxes payable | As of As of 2020 2019 Income tax payable $ 568,830 $ 942,160 VAT payable 109,414 522,335 Other tax payables (other payables and accrued liabilities) 18,408 68,655 Total $ 696,652 $ 1,533,150 |
Organization and Nature of Op_3
Organization and Nature of Operations (Details) - CNY (¥) | 12 Months Ended | |
Mar. 31, 2020 | Aug. 31, 2018 | |
% of Ownership | 100.00% | |
Fujian Happiness Biotech Co., Ltd ("Fujian Happiness") [Member] | ||
Date of Incorporation | Nov. 19, 2004 | |
Place of Incorporation | PRC | |
Principal Activities | Research, development, production and selling of nutraceutical and dietary supplements | |
Fujian Happiness Biotech Co., Ltd ("Fujian Happiness") [Member] | RMB [Member] | ||
Registered Capital | ¥ 25,755,000 | |
% of Ownership | 100.00% | |
Shunchang Happiness Nutraceutical Co., Ltd ("Shunchang Happiness") [Member] | ||
Date of Incorporation | May 19, 1998 | |
Place of Incorporation | PRC | |
Principal Activities | Research, development, production and selling of edible fungi | |
Shunchang Happiness Nutraceutical Co., Ltd ("Shunchang Happiness") [Member] | RMB [Member] | ||
Registered Capital | ¥ 2,000,000 | |
% of Ownership | 100.00% |
Organization and Nature of Op_4
Organization and Nature of Operations (Details Textual) - USD ($) | 1 Months Ended | |||||||
Mar. 04, 2019 | Aug. 21, 2018 | Mar. 31, 2020 | Oct. 31, 2019 | Oct. 25, 2019 | Mar. 31, 2019 | Aug. 31, 2018 | Feb. 09, 2018 | |
Organization and Nature of Operations [Textual] | ||||||||
Ownership percentage | 100.00% | |||||||
Equity method investment, description | Mr. Wang Xuezhu and other shareholders of Fujian Happiness transferred their 100% ownership interests in Fujian Happiness to Happiness Nanping, which is 100% owned by Happiness Hong Kong. After the reorganization, Happiness Biotech owns 100% equity interests of Fujian Happiness. Mr. Wang Xuezhu, who owns 52.37% ownership of Happiness Biotech, is the ultimate controlling shareholder (“the Controlling Shareholder”) of the Company. | |||||||
Ordinary shares authorized | 100,000,000 | 90,000,000 | 90,000,000 | |||||
Ordinary shares, par value | $ 0.0005 | $ 0.0005 | ||||||
Ordinary shares, issued | 25,000,000 | 23,000,000 | ||||||
Ordinary shares, Outstanding | 25,000,000 | 23,000,000 | ||||||
Cancelled ordinary shares | 77,223,100 | |||||||
Purchase percentage | 15.00% | |||||||
IPO [Member] | ||||||||
Organization and Nature of Operations [Textual] | ||||||||
Ordinary shares authorized | 2,000,000 | |||||||
Ordinary shares, par value | $ 0.0005 | |||||||
Share per price | $ 5.50 | |||||||
Total gross proceed | $ 11,000,000 | |||||||
Total net proceeds | $ 9,342,339 | |||||||
Purchase percentage | 15.00% | |||||||
Ordinary shares | ||||||||
Organization and Nature of Operations [Textual] | ||||||||
Ordinary shares authorized | 50,000 | |||||||
Ordinary shares, par value | $ 1 | |||||||
Ordinary shares, issued | 50,000 | |||||||
Cancelled ordinary shares | 77,223,100 | |||||||
Additional shares sold | 223,100 | |||||||
Mr. Wang Xuezhu [Member] | ||||||||
Organization and Nature of Operations [Textual] | ||||||||
Ownership percentage | 47.70% |
Significant Accounting Polici_4
Significant Accounting Policies (Details) | 12 Months Ended |
Mar. 31, 2020 | |
Buildings [Member] | |
Estimated useful lives of the assets | 20 years |
Machinery [Member] | |
Estimated useful lives of the assets | 10 years |
Furniture, fixture and electronic equipment [Member] | Minimum [Member] | |
Estimated useful lives of the assets | 3 years |
Furniture, fixture and electronic equipment [Member] | Maximum [Member] | |
Estimated useful lives of the assets | 10 years |
Vehicles [Member] | |
Estimated useful lives of the assets | 4 years |
Significant Accounting Polici_5
Significant Accounting Policies (Details 1) - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Other | $ 11,550,670 | $ 10,054,790 |
Total | 65,061,953 | 63,936,185 |
Lucidum spore powder products [Member] | ||
Total | 28,233,256 | 19,886,508 |
Cordyceps mycelia products [Member] | ||
Total | 8,854,717 | 10,883,298 |
Ejiao solution products [Member] | ||
Total | 6,266,098 | 9,583,260 |
Vitamins and dietary supplements products [Member] | ||
Total | 6,235,541 | 8,616,318 |
American ginseng products [Member] | ||
Total | $ 3,921,671 | $ 4,912,011 |
Significant Accounting Polici_6
Significant Accounting Policies (Details 2) - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Significant Accounting Policies | ||
Traditional distribution model | $ 39,424,118 | $ 38,263,069 |
Regional distributors | 32,934,385 | 29,986,045 |
Chain drugstores, malls and supermarkets | 6,489,733 | 8,277,024 |
Experience store model | 24,512,067 | 26,798,884 |
Total revenues | $ 63,936,185 | $ 65,061,953 |
Significant Accounting Polici_7
Significant Accounting Policies (Details 3) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Period-end spot rate [Member] | ||
Currency exchange rates | US$1=RMB 7.0851 Yuan | US$1=RMB 6.7335 Yuan |
Average rate [Member] | ||
Currency exchange rates | US$1=RMB 6.9655 Yuan | US$1=RMB 6.7317 Yuan |
Significant Accounting Polici_8
Significant Accounting Policies (Details Textual) | 12 Months Ended | ||||
Mar. 31, 2020USD ($) | Mar. 31, 2019USD ($) | Mar. 31, 2020CNY (¥) | Mar. 31, 2019CNY (¥) | Mar. 31, 2018USD ($) | |
Significant Accounting Policies (Textual) | |||||
Straight-line method over the grant period | 50 years | ||||
Percentage of maximum revenue payment to customer | 3.00% | 3.00% | |||
Government grants | $ 162,268 | $ 146,992 | |||
Shipping and handling costs | 1,869,505 | 1,841,312 | |||
Advertising costs | $ 3,856,921 | 3,217,096 | |||
Description of value-added tax | Before May 1, 2018, the applicable VAT rate was 17%, while after May 1, 2018 and before April 1, 2019, the Company is subject to a VAT rate of 16%. After April 1, 2019, the Company is subject to a VAT rate of 13% based on the new Chinese tax law. | ||||
Cash and cash equivalents | $ 33,654,765 | 14,800,772 | $ 8,884,829 | ||
After tax profit | 10.00% | ||||
Accumulative amount of reserve | 50.00% | ||||
Retained earnings | $ 66,623,204 | $ 53,935,169 | |||
RMB [Member] | |||||
Significant Accounting Policies (Textual) | |||||
Cash and cash equivalents | ¥ | ¥ 236,857,749 | ¥ 99,661,001 |
Accounts Receivable (Details)
Accounts Receivable (Details) - USD ($) | Mar. 31, 2020 | Mar. 31, 2019 |
Receivables [Abstract] | ||
Accounts receivable, gross | $ 30,036,448 | $ 32,011,536 |
Less: allowance for doubtful accounts | ||
Accounts receivable | $ 30,036,448 | $ 32,011,536 |
Accounts Receivable (Details Te
Accounts Receivable (Details Textual) - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Accounts Receivable (Textual) | ||
Allowance for doubtful accounts | ||
Customers credit period | 180 days | |
Accounts receivable due | 1 year |
Inventories (Details)
Inventories (Details) - USD ($) | Mar. 31, 2020 | Mar. 31, 2019 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 1,647,667 | $ 1,696,353 |
Work in process | 40,143 | |
Finished goods | 381,739 | 234,239 |
Total | $ 2,029,406 | $ 1,970,735 |
Inventories (Details Textual)
Inventories (Details Textual) - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Inventories (Textual) | ||
Inventory write-downs | $ 117,753 |
Prepaid Expenses and Other Cu_3
Prepaid Expenses and Other Current Assets (Details) - USD ($) | Mar. 31, 2020 | Mar. 31, 2019 |
Prepaid Expenses Details Abstract | ||
Prepayments to suppliers | $ 3,564,705 | $ 5,940,447 |
Other current assets | 699,425 | 116,769 |
Total | $ 4,264,130 | $ 6,057,216 |
Prepaid Expenses and Other Cu_4
Prepaid Expenses and Other Current Assets (Details Textual) | Mar. 31, 2020USD ($) | Mar. 31, 2020CNY (¥) | Mar. 31, 2019USD ($) | Mar. 31, 2019CNY (¥) |
Prepaid expenses | $ | $ 3,564,705 | $ 5,940,447 | ||
Suppliers [Member] | ||||
Prepaid expenses | $ | 2,800,000 | |||
Raw material | $ | $ 72,000 | |||
RMB [Member] | ||||
Prepaid expenses | ¥ | ¥ 600,000 | ¥ 40,000,000 | ||
RMB [Member] | Suppliers [Member] | ||||
Prepaid expenses | ¥ | 19,700,000 | |||
Raw material | ¥ | ¥ 5,000,000 |
Property, Plant and Equipment_2
Property, Plant and Equipment (Details) - USD ($) | Mar. 31, 2020 | Mar. 31, 2019 |
Total property plant and equipment, at cost | $ 12,225,137 | $ 11,664,975 |
Less: accumulated depreciation | (4,328,636) | (3,857,930) |
Property, plant and equipment, net | 7,896,501 | 7,807,045 |
Buildings [Member] | ||
Total property plant and equipment, at cost | 9,590,058 | 9,273,325 |
Machinery [Member] | ||
Total property plant and equipment, at cost | 2,339,879 | 2,150,738 |
Furniture, fixture and electronic equipment [Memebr] | ||
Total property plant and equipment, at cost | 163,819 | 172,552 |
Vehicles [Member] | ||
Total property plant and equipment, at cost | $ 131,381 | $ 68,360 |
Property, Plant and Equipment_3
Property, Plant and Equipment (Details Textual) - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Property, Plant and Equipment (Textual) | ||
Building collateral for short-term bank loans | $ 5,100,000 | $ 3,100,000 |
Depreciation expense | 674,247 | 682,462 |
Capitalized depreciation in inventories | $ 555,636 | $ 568,017 |
Land Use Rights (Details)
Land Use Rights (Details) - USD ($) | Mar. 31, 2020 | Mar. 31, 2019 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Land use rights, cost | $ 811,194 | $ 853,552 |
Less: accumulated amortization | (91,472) | (79,178) |
Land use rights, net | $ 719,722 | $ 774,374 |
Land Use Rights (Details 1)
Land Use Rights (Details 1) - USD ($) | Mar. 31, 2020 | Mar. 31, 2019 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2021 | $ 16,502 | |
2022 | 16,502 | |
2023 | 16,502 | |
2024 | 16,502 | |
2025 | 16,502 | |
Thereafter | 637,212 | |
Total amortization expense | $ 719,722 | $ 774,374 |
Land Use Rights (Details Textua
Land Use Rights (Details Textual) | 12 Months Ended | |
Mar. 31, 2020USD ($)ft² | Mar. 31, 2019USD ($)ft² | |
Land Use Rights (Textual) | ||
Land use right collateral for a short-term bank loans | $ 719,722 | $ 95,540 |
Amortization expense | $ 16,502 | $ 17,076 |
Square meters | ft² | 29,720 | 12,120 |
Other Assets (Details)
Other Assets (Details) - USD ($) | Mar. 31, 2020 | Mar. 31, 2019 |
Other Assets | ||
Prepayments for advertising or marketing | $ 6,200,104 | $ 1,856,390 |
Prepayment of celebrity endorsement fee | 296,397 | 400,980 |
Total | $ 6,496,501 | $ 2,257,370 |
Other Assets (Details Textual)
Other Assets (Details Textual) | 1 Months Ended | 12 Months Ended | ||
Oct. 31, 2018USD ($) | Oct. 31, 2018CNY (¥) | Mar. 31, 2020USD ($)distributors | Mar. 31, 2020CNY (¥)distributors | |
Other Assets (Textual) | ||||
Number of exclusive distributors | distributors | 45 | 45 | ||
Subsidy to exclusive distributor for advertising and marketing | $ 141,141 | |||
Amount paid to celebrity endorsement fee | $ 445,533 | |||
Celebrity endorsement contract period | 5 years | 5 years | ||
Marketing and advertisement cost | $ 1,600,000 | |||
Prepayments amortized contract period | 3 years | 3 years | ||
RMB [Member] | ||||
Other Assets (Textual) | ||||
Subsidy to exclusive distributor for advertising and marketing | ¥ | ¥ 1,000,000 | |||
Amount paid to celebrity endorsement fee | ¥ | ¥ 3,000,000 |
Short-Term Bank Borrowings (Det
Short-Term Bank Borrowings (Details) - USD ($) | Mar. 31, 2020 | Mar. 31, 2019 |
Short-term bank borrowings | $ 2,032,434 | $ 1,039,578 |
Industrial Bank Co., Ltd [Member] | ||
Short-term bank borrowings | 987,989 | 1,039,578 |
Postal Saving Bank of China [Member] | ||
Short-term bank borrowings | $ 1,044,445 |
Short-Term Bank Borrowings (D_2
Short-Term Bank Borrowings (Details 1) - USD ($) | Mar. 31, 2020 | Mar. 31, 2019 |
Pledged assets to secure short-term borrowings | $ 5,798,802 | $ 3,165,139 |
Buildings, net [Member] | ||
Pledged assets to secure short-term borrowings | 5,079,080 | 3,069,599 |
Land use rights, net [Member] | ||
Pledged assets to secure short-term borrowings | $ 719,722 | $ 95,540 |
Short-Term Bank Borrowings (D_3
Short-Term Bank Borrowings (Details Textual) | Feb. 06, 2020USD ($) | Jan. 15, 2020USD ($) | May 04, 2018USD ($) | Jun. 28, 2019CNY (¥) | Apr. 30, 2019USD ($) | Apr. 19, 2019CNY (¥) | Mar. 31, 2020USD ($) | Mar. 31, 2019USD ($) | Feb. 06, 2020CNY (¥) | Jan. 15, 2020CNY (¥) | Aug. 01, 2019CNY (¥) | Jun. 24, 2019USD ($) | Jun. 24, 2019CNY (¥) | Apr. 30, 2019CNY (¥) | May 04, 2018CNY (¥) |
Short-Term Bank Borrowings (Textual) | |||||||||||||||
Interest expense on short-term bank loans | $ | $ 98,086 | $ 83,549 | |||||||||||||
Industrial Bank Co., Ltd [Member] | |||||||||||||||
Short-Term Bank Borrowings (Textual) | |||||||||||||||
Short-term bank borrowings | $ | $ 1,039,578 | $ 987,989 | |||||||||||||
Due date | Apr. 21, 2019 | Apr. 30, 2020 | Apr. 30, 2020 | ||||||||||||
Interest rate, description | The loan bears a fixed interest rate of 1-year Loan Prime Rate ("LPR") +2.19% on the date of drawing per annum. | Bearing interest rate at LPR plus 1.69% per annum, payable monthly. | |||||||||||||
Industrial Bank Co., Ltd [Member] | RMB [Member] | |||||||||||||||
Short-Term Bank Borrowings (Textual) | |||||||||||||||
Short-term bank borrowings | ¥ 7,000,000 | ¥ 7,000,000 | ¥ 7,000,000 | ||||||||||||
Maximum guaranteed amount | 7,000,000 | ||||||||||||||
Maximum pledged amount for building and land use rights | ¥ 17,400,000 | ||||||||||||||
Postal Saving Bank of China [Member] | |||||||||||||||
Short-Term Bank Borrowings (Textual) | |||||||||||||||
Short-term bank borrowings | $ | $ 197,597 | $ 846,848 | $ 3,400,000 | ||||||||||||
Due date | Feb. 5, 2021 | Jan. 14, 2021 | |||||||||||||
Interest rate, description | Loans bearing fixed interest rate of 4.35%, which will be due on January 14, 2021 and February 5, 2021, respectively. | Loans bearing fixed interest rate of 4.35%, which will be due on January 14, 2021 and February 5, 2021, respectively. | The loans bear a fixed interest rate of 5.66%; and the Company repaid both loans in full during the fiscal year. | ||||||||||||
Postal Saving Bank of China [Member] | RMB [Member] | |||||||||||||||
Short-Term Bank Borrowings (Textual) | |||||||||||||||
Short-term bank borrowings | ¥ 4,000,000 | ¥ 1,400,000 | ¥ 6,000,000 | ¥ 3,400,000 | ¥ 24,400,000 |
Amounts Due to Related Party (D
Amounts Due to Related Party (Details) | Mar. 31, 2020USD ($) |
Xuezhu Wang [Member] | |
Amounts Due To Related Party (Textual) | |
Due to related parties | $ 844,716 |
Shareholders' Equity (Details)
Shareholders' Equity (Details) | 12 Months Ended |
Mar. 31, 2020USD ($)$ / sharesshares | |
Number Outstanding | |
Options Outstanding, beginning balance | |
Options Exercisable, beginning balance | |
Options granted | 300,000 |
Options forfeited | |
Options expired | (300,000) |
Options Outstanding, ending balance | |
Options Exercisable, ending balance | |
Weighted Average Exercise Price | |
Options Outstanding, beginning balance | $ / shares | |
Options Exercisable, beginning balance | $ / shares | |
Options granted | $ / shares | 5.12 |
Options forfeited | $ / shares | |
Options expired | $ / shares | 5.12 |
Options Outstanding, ending balance | $ / shares | |
Options Exercisable, ending balance | $ / shares | |
Contractual Life in Days | |
Options granted | 45 days |
Options expired | 45 days |
Intrinsic Value | |
Options Outstanding, beginning balance | $ | |
Options Exercisable, beginning balance | $ | |
Options granted | |
Options forfeited | |
Intrinsic Value, expired | |
Options Outstanding, ending balance | $ | |
Options Exercisable, ending balance | $ |
Shareholders' Equity (Details 1
Shareholders' Equity (Details 1) | 12 Months Ended |
Mar. 31, 2020USD ($)$ / sharesshares | |
Number Outstanding | |
Warrants Outstanding, Beginning | shares | |
Warrants granted | shares | 160,000 |
Warrants forfeited | shares | |
Warrants exercised | shares | |
Warrants Outstanding, Ending | shares | 160,000 |
Weighted Average Exercise Price | |
Warrants Outstanding, Beginning | $ / shares | |
Warrants granted | $ / shares | 6.60 |
Warrants forfeited | $ / shares | |
Warrants exercised | $ / shares | |
Warrants Outstanding, Ending | $ / shares | $ 6.60 |
Contractual Life in Years | |
Warrants Outstanding, Beginning | |
Warrants granted | 5 years |
Warrants forfeited | |
Warrants exercised | |
Warrants Outstanding, Ending | 4 years 7 months 6 days |
Intrinsic Value | |
Warrants Outstanding, Beginning | $ | |
Warrants granted | $ | |
Warrants forfeited | $ | |
Warrants exercised | $ | |
Warrants Outstanding, Ending | $ |
Shareholders' Equity (Details T
Shareholders' Equity (Details Textual) | 1 Months Ended | 12 Months Ended | ||||||||
Oct. 31, 2019 | Mar. 04, 2019$ / sharesshares | May 31, 2018USD ($) | May 31, 2018CNY (¥) | Mar. 31, 2019USD ($)$ / sharesshares | Mar. 31, 2020USD ($)$ / sharesshares | Mar. 31, 2020CNY (¥)shares | Oct. 25, 2019USD ($)$ / sharesshares | Aug. 31, 2018 | Feb. 09, 2018$ / sharesshares | |
Shareholders' Equity (Textual) | ||||||||||
Issued ordinary shares | 23,000,000 | 25,000,000 | 25,000,000 | |||||||
Ordinary shares authorized | 100,000,000 | 90,000,000 | 90,000,000 | 90,000,000 | ||||||
Ordinary shares par value | $ / shares | $ 0.0005 | $ 0.0005 | $ 0.0005 | |||||||
Ownership percentage | 100.00% | |||||||||
Cancelled ordinary shares | 77,223,100 | |||||||||
Sold additional ordinary shares | 223,100 | |||||||||
Statutory surplus reserve percentage description | Appropriations to the statutory surplus reserve are required to be at least 10% of the after-tax net income determined in accordance with PRC GAAP until the reserve is equal to 50% of the entity's registered capital. Appropriations to the discretionary surplus reserve are made at the discretion of the Board of Directors. In 2019, $56,077 was appropriated by Fujian Happiness to the statutory surplus reserve and the statutory reserve reached 50% of its registered capital. In 2020, no statutory surplus was appropriated. | |||||||||
Statutory surplus reserve | $ | $ 2,064,096 | $ 2,064,096 | ||||||||
Ordinary shares, shares authorized | 100,000,000 | 90,000,000 | 90,000,000 | 90,000,000 | ||||||
Purchase percentage | 15.00% | |||||||||
Retained earnings | $ | $ 53,935,169 | $ 66,623,204 | ||||||||
PRC [Member] | ||||||||||
Shareholders' Equity (Textual) | ||||||||||
Retained earnings | $ | 67,600,000 | |||||||||
IPO [Member] | ||||||||||
Shareholders' Equity (Textual) | ||||||||||
Ordinary shares authorized | 2,000,000 | |||||||||
Ordinary shares par value | $ / shares | $ 0.0005 | |||||||||
Ordinary shares, shares authorized | 2,000,000 | |||||||||
Share per price | $ / shares | $ 5.50 | |||||||||
Total gross proceed | $ | $ 11,000,000 | |||||||||
Total net proceeds | $ | $ 9,342,339 | |||||||||
Purchase percentage | 15.00% | |||||||||
RMB [Member] | PRC [Member] | ||||||||||
Shareholders' Equity (Textual) | ||||||||||
Retained earnings | ¥ | ¥ 454,500,000 | |||||||||
Investor 2 [Member] | ||||||||||
Shareholders' Equity (Textual) | ||||||||||
Cash received from investor | $ | $ 627,628 | |||||||||
Investor 2 [Member] | RMB [Member] | ||||||||||
Shareholders' Equity (Textual) | ||||||||||
Cash received from investor | ¥ | ¥ 4,000,000 | |||||||||
Ordinary Shares [Member] | ||||||||||
Shareholders' Equity (Textual) | ||||||||||
Issued ordinary shares | 50,000 | |||||||||
Ordinary shares authorized | 50,000 | |||||||||
Ordinary shares par value | $ / shares | $ 1 | $ 1 | ||||||||
Cancelled ordinary shares | 77,223,100 | |||||||||
Ordinary shares, shares authorized | 50,000 | |||||||||
Additional Paid-In Capital [Member] | ||||||||||
Shareholders' Equity (Textual) | ||||||||||
Statutory surplus reserve | $ | $ 7,778,259 | $ 7,778,259 | ||||||||
Warrant [Member] | ||||||||||
Shareholders' Equity (Textual) | ||||||||||
Description of warrant | The Company granted to the underwriters warrants to purchase up to a total of 184,000 ordinary shares (equal to 8% of the aggregate number of ordinary shares sold in the offering, if over-allotment shares are placed by the underwriters. Without over-allotment share issuance, a total of 160,000 warrants will be granted). The warrants will be exercisable at an exercise price equal to one hundred twenty percent (120%) of the offering price, in whole or in parts, at any time from issuance and expire five (5) years from the effective date of the offering. |
Taxes (Details)
Taxes (Details) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||
PRC statutory income tax rate | 25.00% | 25.00% |
Effect of PRC preferential tax rate | (10.00%) | (10.00%) |
Effect of other deductible expenses | 3.30% | 0.50% |
Total | 18.30% | 14.50% |
Taxes (Details 1)
Taxes (Details 1) - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||
Current income tax provision | $ 2,844,087 | $ 3,183,154 |
Deferred income tax provision | ||
Total | $ 2,844,087 | $ 3,183,154 |
Taxes (Details 2)
Taxes (Details 2) - USD ($) | Mar. 31, 2020 | Mar. 31, 2019 |
Income Tax Disclosure [Abstract] | ||
Income tax payable | $ 568,830 | $ 942,160 |
VAT payable | 109,414 | 522,335 |
Other tax payables (other payables and accrued liabilities) | 18,408 | 68,655 |
Total | $ 696,652 | $ 1,533,150 |
Taxes (Details Textual)
Taxes (Details Textual) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Taxes (Textual) | ||
Statutory income tax rate | 18.30% | 14.50% |
Income tax (''New EIT Law''), description | Effective from January 1, 2008, both domestically-owned enterprises and foreign-invested enterprises are subject to a uniform tax rate of 25% while preferential tax rates, tax holidays and even tax exemption may be granted on case-by-case basis. EIT grants preferential tax treatment to High and New Technology Enterprises (“HNTEs”). Under this preferential tax treatment, HNTEs are entitled to an income tax rate of 15%, subject to a requirement that they re-apply for HNTE status every three years. Fujian Happiness, the Company’s main operating entity in PRC, was approved as HNTEs and is entitled to a reduced income tax rate of 15% from December 2019 to December 2022. | |
Hong Kong [Member] | ||
Taxes (Textual) | ||
Statutory income tax rate | 16.50% |
Customer and Supplier Concent_2
Customer and Supplier Concentration (Details) - USD ($) | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Customer and Supplier Concentration (Textual) | ||
Description of the risk factors | Significant customers and suppliers are those that account for greater than 10% of the Company’s revenues and purchases. | |
Third-party supplier 1 [Member] | Purchase [Member] | ||
Customer and Supplier Concentration (Textual) | ||
Concentration risk, percentage | 16.67% | 12.70% |
Third-party supplier 2 [Member] | Purchase [Member] | ||
Customer and Supplier Concentration (Textual) | ||
Concentration risk, percentage | 11.70% | |
Vendor 1 [Member] | Purchase [Member] | ||
Customer and Supplier Concentration (Textual) | ||
Concentration due amount | $ 0 | $ 384,547 |
Vendor 2 [Member] | Purchase [Member] | ||
Customer and Supplier Concentration (Textual) | ||
Concentration due amount | $ 129,984 | |
Revenues [Member] | Customer [Member] | ||
Customer and Supplier Concentration (Textual) | ||
Concentration risk, percentage | 10.00% | 10.00% |
Accounts Receivable [Member] | Customer [Member] | ||
Customer and Supplier Concentration (Textual) | ||
Concentration risk, percentage | 10.00% | 10.00% |
Subsequent Events (Details)
Subsequent Events (Details) | Apr. 07, 2020CNY (¥) | May 04, 2018USD ($) | Apr. 30, 2020CNY (¥) | Apr. 30, 2019USD ($) | Apr. 19, 2019CNY (¥) | Mar. 31, 2020CNY (¥) | Apr. 30, 2019CNY (¥) | Aug. 31, 2018 | May 04, 2018CNY (¥) |
Subsequent Events (Textual) | |||||||||
Ownership equity interest, percentage | 100.00% | ||||||||
Covid-19, description | The Company was impacted by the COVID-19 pandemic inmany ways, including the plump of closures of experience stores, diving sales by distribution channels, and shut down or partly shut down of production facilities for around three months. As a result, revenue dropped by approximately 50% for the three months ended on March 31, 2020, compared with the revenue of the same period in 2019. | ||||||||
Industrial Bank Co., Ltd [Member] | |||||||||
Subsequent Events (Textual) | |||||||||
Loan agreement amount | $ | $ 1,039,578 | $ 987,989 | |||||||
Due date | Apr. 21, 2019 | Apr. 30, 2020 | Apr. 30, 2020 | ||||||
Interest rate, description | The loan bears a fixed interest rate of 1-year Loan Prime Rate ("LPR") +2.19% on the date of drawing per annum. | Bearing interest rate at LPR plus 1.69% per annum, payable monthly. | |||||||
RMB [Member] | Industrial Bank Co., Ltd [Member] | |||||||||
Subsequent Events (Textual) | |||||||||
Loan agreement amount | ¥ 7,000,000 | ¥ 7,000,000 | ¥ 7,000,000 | ||||||
Subsequent Event [Member] | |||||||||
Subsequent Events (Textual) | |||||||||
Line of credit facility, description | Fujian Happiness Biotech Co., Ltd withdrew proceeds of a RMB 1.7 million under this credit facility on April 7, 2020 and may drawdown another RMB 1.3 million within loan tenor period. | ||||||||
Subsequent Event [Member] | Industrial Bank Co., Ltd [Member] | |||||||||
Subsequent Events (Textual) | |||||||||
Due date | Apr. 30, 2021 | ||||||||
Interest rate, description | Bearing interest rate at LPR plus 1.45% per annum, payable monthly. | ||||||||
Subsequent Event [Member] | RMB [Member] | Industrial Bank Co., Ltd [Member] | |||||||||
Subsequent Events (Textual) | |||||||||
Loan agreement amount | ¥ 7,000,000 | ||||||||
Total amount of short term borrowings | ¥ 7,000,000 | ||||||||
Fujian Happiness Biotech Co., Ltd [Member] | RMB [Member] | |||||||||
Subsequent Events (Textual) | |||||||||
Ownership equity interest, percentage | 100.00% | ||||||||
Registered capital | ¥ 25,755,000 | ||||||||
Fujian Happiness Biotech Co., Ltd [Member] | Subsequent Event [Member] | |||||||||
Subsequent Events (Textual) | |||||||||
Due date | May 31, 2021 | ||||||||
Ownership equity interest, percentage | 51.00% | ||||||||
Interest rate, description | Loan bearing interest at LPR Index plus 0.2% per annum (LPR 4.2 % in April 2020) payable monthly, with a revolving credit facility clause in this contract. | ||||||||
Fujian Happiness Biotech Co., Ltd [Member] | Subsequent Event [Member] | RMB [Member] | |||||||||
Subsequent Events (Textual) | |||||||||
Loan agreement amount | ¥ 3,000,000 | ||||||||
Mr. ZhiHui Zhen [Member] | Subsequent Event [Member] | |||||||||
Subsequent Events (Textual) | |||||||||
Ownership equity interest, percentage | 49.00% | ||||||||
Fujian Happiness Medical Equipment Co. Ltd [Member] | Subsequent Event [Member] | RMB [Member] | |||||||||
Subsequent Events (Textual) | |||||||||
Registered capital | ¥ 10,000,000 | ||||||||
Contributed amount of medical products | ¥ 500,000 |