Document And Entity Information
Document And Entity Information | 12 Months Ended |
Jun. 30, 2023 shares | |
Document Information Line Items | |
Entity Registrant Name | ICZOOM GROUP INC. |
Trading Symbol | IZM |
Document Type | 20-F |
Current Fiscal Year End Date | --06-30 |
Amendment Flag | false |
Entity Central Index Key | 0001854572 |
Entity Current Reporting Status | Yes |
Entity Voluntary Filers | No |
Entity Filer Category | Non-accelerated Filer |
Entity Well-known Seasoned Issuer | No |
Document Period End Date | Jun. 30, 2023 |
Document Fiscal Year Focus | 2023 |
Document Fiscal Period Focus | FY |
Entity Emerging Growth Company | true |
Entity Shell Company | false |
Entity Ex Transition Period | false |
ICFR Auditor Attestation Flag | false |
Document Registration Statement | false |
Document Annual Report | true |
Document Transition Report | false |
Document Shell Company Report | false |
Entity File Number | 001-41645 |
Entity Incorporation, State or Country Code | E9 |
Entity Address, Address Line One | Room 3801, Building A, Sunhope e·METRO, No. 7018 Cai Tian Road |
Entity Address, Address Line Two | Futian District |
Entity Address, City or Town | Shenzhen |
Entity Address, Country | CN |
Entity Address, Postal Zip Code | 518000 |
Title of 12(b) Security | Class A Ordinary shares, par value $0.16 per share |
Security Exchange Name | NASDAQ |
Entity Interactive Data Current | Yes |
Document Financial Statement Error Correction [Flag] | false |
Document Accounting Standard | U.S. GAAP |
Auditor Firm ID | 3487 |
Auditor Name | Alliance LLP |
Auditor Location | Singapore |
Business Contact [Member] | |
Document Information Line Items | |
Entity Address, Address Line One | Room 3801, Building A, Sunhope e·METRO, No. 7018 Cai Tian Road |
Entity Address, Address Line Two | Futian District |
Entity Address, City or Town | Shenzhen |
Entity Address, Country | CN |
Entity Address, Postal Zip Code | 518000 |
Contact Personnel Name | Mr. Lei Xia |
City Area Code | 86 755 |
Local Phone Number | 86036281 |
Class A Ordinary Shares | |
Document Information Line Items | |
Entity Common Stock, Shares Outstanding | 6,496,874 |
Class B Ordinary Shares | |
Document Information Line Items | |
Entity Common Stock, Shares Outstanding | 3,829,500 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Jun. 30, 2023 | Jun. 30, 2022 | |
CURRENT ASSETS: | |||
Cash | $ 1,109,834 | $ 1,134,416 | |
Restricted cash | 5,303,533 | 1,817,607 | |
Short-term investments | 1,490 | ||
Notes receivable | 18,000 | ||
Accounts receivable, net | 76,690,246 | 76,020,296 | |
Inventories, net | 833,858 | 365,615 | |
Advances to suppliers | 1,608,941 | 6,613,280 | |
Prepaid expenses and other current assets | 1,341,201 | 2,432,913 | |
TOTAL CURRENT ASSETS | 86,887,613 | 88,403,617 | |
Property and equipment, net | 126,032 | 119,244 | |
Right-of-use assets, net | 862,852 | 692,571 | |
Intangible assets, net | 288,436 | 378,338 | |
Other non-current assets | 10,600 | 14,491 | |
Deferred tax assets | 305 | 24,751 | |
TOTAL NON-CURRENT ASSETS | 1,288,225 | 1,229,395 | |
TOTAL ASSETS | 88,175,838 | 89,633,012 | |
CURRENT LIABILITIES: | |||
Short-term bank loans, net | 14,022,523 | 11,760,387 | |
Short-term borrowings- third-party loans | 100,000 | ||
Accounts payable | 51,127,328 | 59,558,743 | |
Contract liabilities | 1,671,353 | 3,651,700 | |
Due to related parties | 1,508,766 | 349,684 | |
Taxes payable | 2,932,137 | 2,675,002 | |
Operating lease liabilities | 524,698 | 232,221 | |
Accrued expenses and other current liabilities | 469,781 | 329,924 | |
TOTAL CURRENT LIABILITIES | 72,256,586 | 78,657,661 | |
Operating lease liabilities | 375,056 | 480,436 | |
TOTAL NON-CURRENT LIABILITY | 375,056 | 480,436 | |
TOTAL LIABILITIES | 72,631,642 | 79,138,097 | |
COMMITMENTS AND CONTINGENCIES | |||
SHAREHOLDERS’ EQUITY | |||
Ordinary shares value | [1] | ||
Additional paid-in capital | 18,795,548 | 14,499,213 | |
Statutory reserve | 624,097 | 624,097 | |
Accumulated deficit | (5,334,300) | (7,085,470) | |
Accumulated other comprehensive income(loss) | (193,368) | 1,044,856 | |
TOTAL SHAREHOLDERS’ EQUITY | 15,544,196 | 10,494,915 | |
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | 88,175,838 | 89,633,012 | |
Class A Ordinary shares | |||
SHAREHOLDERS’ EQUITY | |||
Ordinary shares value | 1,039,499 | 799,499 | |
Class B Ordinary shares | |||
SHAREHOLDERS’ EQUITY | |||
Ordinary shares value | $ 612,720 | $ 612,720 | |
[1]Retrospectively restated for effect of 1-for-4 reverse split on November 2020 and 1-for-2 reverse split on August 8, 2022 of the ordinary shares, see Note 16. |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - $ / shares | Jun. 30, 2023 | Jun. 30, 2022 | |
Ordinary shares, par value (in Dollars per share) | [1] | $ 0.16 | $ 0.16 |
Ordinary shares, shares authorized | [1] | 35,000,000 | 35,000,000 |
Ordinary shares, shares issued | [1] | 10,326,374 | 8,826,374 |
Ordinary shares, shares outstanding | [1] | 10,326,374 | 8,826,374 |
Class A Ordinary shares | |||
Ordinary shares, shares authorized | 30,000,000 | 30,000,000 | |
Ordinary shares, shares issued | 6,496,874 | 4,996,874 | |
Ordinary shares, shares outstanding | 6,496,874 | 4,996,874 | |
Class B Ordinary shares | |||
Ordinary shares, shares authorized | 5,000,000 | 5,000,000 | |
Ordinary shares, shares issued | 3,829,500 | 3,829,500 | |
Ordinary shares, shares outstanding | 3,829,500 | 3,829,500 | |
[1]Retrospectively restated for effect of 1-for-4 reverse split on November 2020 and 1-for-2 reverse split on August 8, 2022 of the ordinary shares, see Note 16. |
Consolidated Statements of Inco
Consolidated Statements of Income and Comprehensive Income - USD ($) | 12 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | ||
Revenue, net | |||
Sales of electronic components, net of sales taxes and value added taxes | $ 211,123,155 | $ 286,539,736 | |
Service commission fees, net of sales taxes and value added taxes | 3,282,071 | 3,836,635 | |
Total revenue, net | 214,405,226 | 290,376,371 | |
Cost of revenue | 209,112,615 | 282,561,907 | |
Gross profit | 5,292,611 | 7,814,464 | |
OPERATING EXPENSES | |||
Selling expenses | 1,991,992 | 1,931,785 | |
General and administrative expenses | 2,425,587 | 2,511,424 | |
Total operating expenses | 4,417,579 | 4,443,209 | |
INCOME FROM OPERATIONS | 875,032 | 3,371,255 | |
OTHER INCOME (EXPENSES) | |||
Foreign exchange transaction gain | 1,788,870 | 301,133 | |
Interest expense | (567,915) | (356,624) | |
Short-term investment income | 14,748 | 30,775 | |
Subsidy income | 125,125 | 213,741 | |
Loss from termination of the VIE agreements | (205,249) | ||
Other expenses, net | (219,020) | (197,945) | |
Total other income (expenses), net | 1,141,808 | (214,169) | |
INCOME BEFORE INCOME TAX PROVISION | 2,016,840 | 3,157,086 | |
INCOME TAX EXPENSES | (265,670) | (587,276) | |
NET INCOME | 1,751,170 | 2,569,810 | |
Foreign currency translation adjustments | (1,238,224) | 817,991 | |
TOTAL COMPREHENSIVE INCOME | $ 512,946 | $ 3,387,801 | |
EARNINGS PER ORDINARY SHARE: | |||
– BASIC (in Dollars per share) | $ 0.19 | $ 0.29 | |
– DILUTED (in Dollars per share) | $ 0.18 | $ 0.27 | |
WEIGHTED AVERAGE NUMBER OF ORDINARY SHARES*: | |||
– BASIC (in Shares) | [1] | 9,201,374 | 8,826,374 |
– DILUTED (in Shares) | [1] | 9,918,931 | 9,547,346 |
[1]Retrospectively restated for effect of 1-for-4 reverse split on November 2020 and 1-for-2 reverse split on August 8, 2022 of the ordinary shares, see Note 16. |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders’ Equity - USD ($) | Class A Common Stock Common Stock | Class A Common Stock | Class B common stock Common Stock | Class B common stock | Additional Paid-in Capital | Statutory Reserve | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | Total | |
Balance at Jun. 30, 2021 | $ 799,499 | $ 612,720 | $ 14,600,143 | $ 538,750 | $ (9,364,684) | $ 226,865 | $ 7,413,293 | |||
Balance (in Shares) at Jun. 30, 2021 | 4,996,874 | 3,829,500 | ||||||||
Employee common share options | 54,171 | 54,171 | ||||||||
Net income for the year | 2,569,810 | 2,569,810 | ||||||||
Appropriation to statutory reserve | 85,347 | (85,347) | ||||||||
Effect of termination of the VIE | (155,101) | (205,249) | (360,350) | |||||||
Foreign currency translation adjustment | 817,991 | 817,991 | ||||||||
Balance at Jun. 30, 2022 | $ 799,499 | $ 612,720 | 14,499,213 | 624,097 | (7,085,470) | 1,044,856 | $ 10,494,915 | |||
Balance (in Shares) at Jun. 30, 2022 | 4,996,874 | 4,996,874 | 3,829,500 | 3,829,500 | 8,826,374 | [1] | ||||
Employee common share options | 102,783 | $ 102,783 | ||||||||
Net income for the year | 1,751,170 | 1,751,170 | ||||||||
Foreign currency translation adjustment | (1,238,224) | (1,238,224) | ||||||||
Issuance of new shares | $ 240,000 | 4,193,552 | 4,433,552 | |||||||
Issuance of new shares (in Shares) | 1,500,000 | |||||||||
Balance at Jun. 30, 2023 | $ 1,039,499 | $ 612,720 | $ 18,795,548 | $ 624,097 | $ (5,334,300) | $ (193,368) | $ 15,544,196 | |||
Balance (in Shares) at Jun. 30, 2023 | 6,496,874 | 6,496,874 | 3,829,500 | 3,829,500 | 10,326,374 | [1] | ||||
[1]Retrospectively restated for effect of 1-for-4 reverse split on November 2020 and 1-for-2 reverse split on August 8, 2022 of the ordinary shares, see Note 16. |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Cash flows from operating activities: | ||
Net income | $ 1,751,170 | $ 2,569,810 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 197,233 | 148,071 |
Loss (gain) from disposal of property and equipment | 882 | (2,296) |
Amortization of right-of-use assets | 381,795 | 41,968 |
(Reversal)/Provision for doubtful accounts | (99,003) | 30,187 |
Provision for inventory impairment | 1,851 | |
Amortization of share-based compensation | 1,325,616 | 54,171 |
Amortization of debt issuance costs | 102,783 | 197,366 |
Deferred income tax provision | 23,465 | 5,994 |
Unrealized exchange gain | (383,469) | (172,794) |
Loss from termination of the VIE agreements | 205,249 | |
Changes in operating assets and liabilities: | ||
Notes receivable | 18,000 | |
Accounts receivable | (3,711,373) | (9,211,978) |
Inventories | (495,580) | 2,096,212 |
Advances to suppliers | 5,004,076 | 30,759 |
Prepaid expenses and other current assets | 315,056 | 622,011 |
Accounts payable | (6,364,245) | 5,179,267 |
Contract liabilities | (1,832,960) | (1,632,254) |
Taxes payable | 421,057 | 454,963 |
Operating Lease liabilities | (392,422) | (22,985) |
Accrued expenses and other current liabilities | (15,764) | (455,171) |
Net cash (used in) provided by operating activities | (3,751,832) | 138,550 |
Cash flows from investing activities: | ||
Purchase of property and equipment | (81,913) | (22,218) |
Proceeds from disposal of property and equipment | 3,096 | |
Purchase of intangible assets | (63,698) | (9,669) |
Purchase of short-term investments | (4,125,704) | (20,025,600) |
Proceeds upon maturity of short-term investments | 4,127,088 | 20,918,110 |
Net cash (used in) provided by investing activities | (144,227) | 863,719 |
Cash flows from financing activities: | ||
Proceeds from short-term bank loans | 30,912,118 | 30,052,076 |
Repayments of short-term bank loans | (27,708,103) | (32,900,000) |
Proceeds from loans payable to third-parties | 660,000 | 962,239 |
Repayments from loans payable to third-parties | (760,000) | (1,232,239) |
Proceeds from banker’s acceptance notes payable | 1,500,000 | |
Repayment of banker’s acceptance notes payable | (1,500,035) | |
Proceeds from borrowings from related parties | 5,540,543 | 940,300 |
Proceeds from sale of common stock, net of issuance costs | 4,433,552 | |
Payment for deferred IPO costs | (231,355) | |
Repayment of related party borrowings | (4,328,894) | (1,086,860) |
Net cash provided by (used in) financing activities | 8,749,216 | (3,495,874) |
Effect of exchange rate fluctuation on cash and restricted cash | (1,391,813) | (1,362,562) |
Net increase (decrease) in cash and restricted cash | 3,461,344 | (3,856,167) |
Cash and restricted cash at beginning of year | 2,952,023 | 6,808,190 |
Cash and restricted cash at end of year | 6,413,367 | 2,952,023 |
Supplemental cash flow information | ||
Cash paid for income taxes | (190,438) | (151,055) |
Cash paid for interest | (567,915) | (356,624) |
Supplemental disclosure of non-cash investing and financing activities | ||
Right-of-use assets obtained in exchange for operating lease obligations | $ 241,678 | $ 732,993 |
Cash Flow Statement Reconciliat
Cash Flow Statement Reconciliation of Cash and Restricted Cash - USD ($) | Jun. 30, 2023 | Jun. 30, 2022 |
Statement of Cash Flows [Abstract] | ||
Cash, end of year | $ 1,109,834 | $ 1,134,416 |
Restricted cash, end of year | 5,303,533 | 1,817,607 |
Cash and restricted cash at end of year | 6,413,367 | 2,952,023 |
Cash, beginning of year | 1,134,416 | 3,196,683 |
Restricted cash, beginning of year | 1,817,607 | 3,611,507 |
Cash and restricted cash at beginning of year | $ 2,952,023 | $ 6,808,190 |
Organization and Business Descr
Organization and Business Description | 12 Months Ended |
Jun. 30, 2023 | |
Organization and Business Description [Abstract] | |
ORGANIZATION AND BUSINESS DESCRIPTION | NOTE 1 — ORGANIZATION AND BUSINESS DESCRIPTION Business ICZOOM Group Inc. (“ICZOOM” or the “Company”), through its wholly-owned subsidiaries, is engaged in sales of electronic components to customers in the People’s Republic of China (“PRC”). Major electronic components purchased from suppliers and then sold to customers through the Company’s online platform include: integrated circuit, discrete, passive components, optoelectronics, electromechanical, Maintenance, Repair and Operations (“MRO”), design tools, etc. These electronic components are primarily used by customers in the consumer electronic industry, automotive electronics, industry control segment with primary target customers being China-based small and medium-sized enterprises. In addition, the Company also provides customs clearance, temporary warehousing, logistic and shipping services to customers to earn service commission fees. Organization ICZOOM, formerly known as Horizon Business Intelligence Co., Limited, was incorporated as an exempted company with limited liability under the laws of the Cayman Islands on June 18, 2015 and changed to its current name on May 3, 2018. ICZOOM owns 100% of the equity interests of the following four subsidiaries incorporated in accordance with the laws and regulations in Hong Kong: (1) Iczoom Electronics Limited (“ICZOOM HK”) was incorporated on May 22, 2012; (2) Ehub Electronics Limited (“Ehub”) was incorporated on September 13, 2012; (3) Hjet Industrial Corporation Limited (“Hjet HK”) was incorporated on August 6, 2013 and (4) Components Zone International Limited (‘Components Zone HK”) was incorporated on May 19, 2020. ICZOOM HK, Ehub and Hjet HK are primarily engaged in purchases and distribution of electronic components from overseas suppliers, and Components Zone HK is a holding company with no activities. On September 17, 2020, Components Zone (Shenzhen) Development Limited (“ICZOOM WFOE”) was incorporated pursuant to PRC laws as a wholly foreign owned enterprise of Components Zone HK. ICZOOM, Components Zone HK and ICZOOM WFOE are currently not engaging in any active business operations and merely acting as holding companies. Prior to the reorganization described below, the chairman of the Board of Directors, Mr. Lei Xia, who is also the Chief Executive Officer (“CEO”) of the Company, and the Chief Operating Officer (“COO”) of the Company, Ms. Duanrong Liu, were the controlling shareholders of the following entities: (1) Hjet Shuntong (Shenzhen) Co., Ltd. (“Hjet Shuntong”), formed in Shenzhen City, China on November 8, 2013; (2) Shenzhen Hjet Supply Chain Co., Ltd. (“Hjet Supply Chain”), formed in Shenzhen City, China on July 3, 2006; (3) Shanghai Heng Nuo Chen International Freight Forwarding Co., Ltd. (“Heng Nuo Chen”), formed in Shanghai City, China on March 25, 2015; (4) Shenzhen Iczoom Electronics Co., Ltd. (“ICZOOM Shenzhen”), formed in Shenzhen City, China on July 20, 2015; (5) Shenzhen Hjet Yun Tong Logistics Co., Ltd. (“Hjet Logtistics”), formed in Shenzhen City, China on May 31, 2013 and (6) Shenzhen Pai Ming Electronics Co., Ltd. (“Pai Ming Shenzhen”), formed in Shenzhen City, China on May 9, 2012. Hjet Shuntong is currently not engaging in any active business operations and merely acting as a holding company. ICZOOM Shenzhen operates the Company’s e-commerce platform to facilitate the sales of electronic components. Hjet Supply Chain handles order fulfilment for e-commerce customers. Heng Nuo Chen and Hjet Logistics are engaged in logistic, shipping and delivery of products to customers. In order to comply with the PRC laws and regulations, Pai Ming Shenzhen holds Internet Content Provider (“ICP”) license to operate the e-commerce platform. Hjet Shuntong, ICZOOM Shenzhen, Hjet Supply Chain, Heng Nuo Chen and Hjet Logistics are collectively called “ICZOOM Operating Entities”. Reorganization A reorganization of the Company’s legal structure (“Reorganization”) was completed on December 14, 2020. The reorganization involved the incorporation of ICZOOM WFOE, the transfer of the 100% equity interest of ICZOOM operating entities to ICZOOM WFOE, and entering into certain contractual arrangements between ICZOOM WFOE and the shareholders of Pai Ming Shenzhen. Consequently, ICZOOM became the ultimate holding company of all the entities mentioned above. On December 14, 2020, ICZOOM WFOE entered into a series of contractual arrangements with the shareholder of Pai Ming Shenzhen. These agreements include Exclusive Purchase Agreement, Exclusive Business Cooperation Agreement, Share Pledge Agreement, Power of Attorney and Spousal Consent Letter (collectively the “VIE Agreements”). Pursuant to the VIE Agreements, ICZOOM WFOE has the exclusive right to provide Pai Ming Shenzhen with consulting services related to business operations including technical and management consulting services. As a result of our direct ownership in ICZOOM WFOE and the VIE Agreements, Pai Ming Shenzhen was treated as a Variable Interest Entity (“VIE”) under the Statement of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 810 Consolidation, which allowed ICZOOM to consolidate Pai Ming Shenzhen’ operations and financial results in ICZOOM’s consolidated financial statements in accordance with U.S. GAAP. ICZOOM was treated as the primary beneficiary for accounting purposes under U.S. GAAP. The Company, together with its wholly owned subsidiaries and its VIE, was effectively controlled by the same shareholders before and after the Reorganization and therefore the Reorganization was considered as a recapitalization of entities under common control. The consolidation of the Company, its subsidiaries, and the VIE 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 consolidated financial statements. The consolidated financial statements of the Company include the following entities: Name of Entity Date of Place of % of Principal ICZOOM June 18, 2015 Cayman Islands Parent, 100% Investment holding ICZOOM HK May 22, 2012 Hong Kong 100% Purchase of electronic components from overseas suppliers Ehub September 13, 2012 Hong Kong 100% Purchase of electronic components from overseas suppliers Hjet HK August 6, 2013 Hong Kong 100% Purchase of electronic components from overseas suppliers Components Zone HK May 19, 2020 Hong Kong 100% Investment holding ICZOOM WFOE September 17, 2020 PRC 100% WFOE, Consultancy Hjet Shuntong November 8, 2013 PRC 100% Investment holding Hjet Supply Chain July 3, 2006 PRC 100% Order fulfilment ICZOOM Shenzhen July 20, 2015 PRC 100% Sales of electronic components through B2B e-commerce platform Hjet Logistics May 31, 2013 PRC 100% Logistics and product shipping Heng Nuo Chen May 25, 2015 PRC 100% Logistics and product shipping. Deregistered in August 2021 Pai Ming Shenzhen May 9, 2012 PRC 0%, Former VIE Holds an EDI license and an ICP License. The VIE agreements has been terminated in December 2021 In order to streamline the Company’s business structure, on August 23, 2021, one of the Company’s subsidiaries, Heng Nuo Chen, completed the deregistration with China’s State Administration of Industry and Commerce. The deregistration of Heng Nuo Chen has no material impact on the Company’s business because Heng Nuo Chen had limited business activities and operation since its inception. Total assets and total liabilities of Heng Nuo Chen as of June 30, 2021 amounted to approximately $5,879 and $325,497, accounted for 0.01% and 0.41% of the Company’s consolidated total assets and liabilities, respectively. Heng Nuo Chen did not generated any revenue since its inception and the accumulated deficit of Heng Nuo Chen as of June 30, 2021 was $305,780, accounted for 3.27% of the Company’s consolidated accumulated deficit. Due to such immateriality, no discontinued operation was reported. The VIE Agreements A VIE is an entity which has a total equity investment that is insufficient to finance its activities without additional subordinated financial support, or whose equity investors lack the characteristics of a controlling financial interest, such as through voting rights, right to receive the expected residual returns of the entity or obligation to absorb the expected losses of the entity. The variable interest holder, if any, that has a controlling financial interest in a VIE is deemed to be the primary beneficiary of, and must consolidate, the VIE. Prior to December 10, 2021, in order to comply with the PRC laws and regulations, the Company held its ICP license to operate the e-commerce platform, through Pai Ming Shenzhen. Pursuant to the VIE Agreements, neither the Company nor its subsidiaries owned any equity interest in Pai Ming Shenzhen. Instead, the Company controlled and received the economic benefits of the operation results of Pai Ming Shenzhen through the VIE Agreements. Under U.S. GAAP, for accounting purposes, the Company was deemed to have a controlling financial interest in, and be the primary beneficiary of Pai Ming Shenzhen, because pursuant to the VIE Agreements, the operations of Pai Ming Shenzhen were solely for the benefit of ICZOOM WFOE and ultimately, the Company. The Company consolidated the operation and financial results of Pai Ming Shenzhen as primary beneficiary through VIE Agreements in lieu of direct equity ownership by the Company. The Company terminated the VIE Agreements with Pai Ming Shenzhen on December 10, 2021 (see “Termination of the VIE Agreements” below for details). Termination of the VIE Agreements Due to PRC legal restrictions on direct foreign investment in internet-based businesses, such as provision of internet information services platform and other value-added telecommunication services, the Company originally carried out its business through a series of VIE Agreements with Pai Ming Shenzhen. On December 10, 2021 (the “VIE termination date”), the Company terminated the VIE Agreements under the VIE structure. There were no penalties or non-compete agreements derived from the termination of the VIE Agreements. After the termination of the VIE Agreement, the Company will no longer consolidate the operation and financial results of Pai Ming Shenzhen going forward. The Company’s Hong Kong subsidiary, ICZOOM HK, now operates a new B2B online platform, which does not require an ICP license under the PRC law. After the termination of the VIE Agreements under the VIE structure, in consideration that it may take some time for customers to take actions to complete the transfer and adapt to new platform, ICZOOM WFOE entered into a business cooperation agreement with Pai Ming Shenzhen on January 18, 2022 to assist such transition over a one-year period, pursuant to which Pai Ming Shenzhen has agreed to provide ICZOOM WFOE with network services including but not limited to business consultation, website information push, matching services of supply and demand information, online advertising, software customization, data analysis, website operation and other in-depth vertical services through online and offline data push, etc., and ICZOOM WFOE has agreed to pay Pai Ming Shenzhen with a base monthly fixed fee of RMB100,000 and additional service fee based on the service performance of Pai Ming Shenzhen. After termination of the VIE Agreement, Pai Ming Shenzhen was treated as a related party to the Company because the COO’s brother was one of the shareholders of Pai Ming Shenzhen. On April 19, 2022, the COO’s brother transferred all of his ownership interest in Pai Ming Shenzhen to an unrelated individual, and Pai Ming Shenzhen was no longer treated as a related party to the Company after April 19, 2022. Therefore, the consulting service fees paid to Pai Ming Shenzhen during the period from January 18, 2022 to April 19, 2022 were accounted for as related party transactions (see Note 14). The termination of the VIE Agreements did not discontinue the Company’s existing business, which is to sell electronic component products and provide related services to customers. Historically, the Company’s business was substantially conducted through its wholly owned subsidiaries established in China and Hong Kong. Prior to the termination of the VIE Agreements, operating revenue generated through Pai Ming Shenzhen amounted to $72,425 from July 1, 2021 to December 10, 2021, accounted for only 0.03% of the Company’s consolidated total revenue for the years ended June 30, 2022. Total assets and total liabilities of Pai Ming Shenzhen amounted to approximately $219,897 and $427,395 as of December 10, 2021, accounted for only 0.60% and 0.89% of the Company’s consolidated total assets and liabilities as of June 30, 2022, respectively. The Company recorded a loss of $205,249 from the termination of the VIE Agreements for the year ended June 30, 2022. Therefore, the Company’s management believes that the termination of the VIE Agreements does not represent a strategic shift that has (or will have) a major effect on the Company’s operations and financial results. The termination is not accounted as discontinued operations in accordance with ASC 205-20. The following presents the unaudited balance sheet information of Pai Ming Shenzhen as of December 10, 2021 and June 30, 2021, and the unaudited result of operations and cash flows of Pai Ming Shenzhen for the period from July 1, 2021 to December 10, 2021 as compared to the year ended June 30, 2021, after elimination of intercompany transactions and balances. December 10, June 30, ASSETS CURRENT ASSETS Cash $ 41,912 $ 2,891 Accounts receivable 173,550 — Prepaid expenses and other current assets 2,024 7,061 TOTAL CURRENT ASSETS 217,486 9,952 Other noncurrent assets 2,411 1,452 TOTAL ASSETS $ 219,897 $ 11,404 LIABILITIES CURRENT LIABILITIES Accrued expenses and other current liabilities $ 427,395 $ 566,158 TOTAL CURRENT LIABILITIES 427,395 566,158 TOTAL LIABILITIES $ 427,395 $ 566,158 From July 1, For the (Unaudited) REVENUE, net $ 72,425 $ 36,273 COST OF REVENUE 1,122 32,229 GROSS PROFIT 71,303 4,044 OPERATING EXPENSES Selling expenses 14,265 37,809 General and administrative expenses 75,751 182,628 Total operating expenses 90,016 220,437 LOSS FROM OPERATIONS (18,713 ) (216,393 ) OTHER INCOME Other income, net 92 243 Total other income, net 92 243 LOSS BEFORE INCOME TAX PROVISION (18,621 ) (216,150 ) PROVISION FOR INCOME TAXES — — NET LOSS $ (18,621 ) $ (216,150 ) From July 1, For the Cash flows from operating activities: Net loss $ (18,621 ) $ (216,150 ) Changes in operating assets and liabilities: Accounts receivable — — Advances to suppliers — — Prepaid expenses and other current assets 4,095 (2,847 ) Other noncurrent assets — (1,421 ) Accrued expenses and other current liabilities 53,198 216,478 Net cash provided by (used in) operating activities 38,672 (3,940 ) Effect of exchange rate fluctuation on cash 349 515 Net increase (decrease) in cash 39,021 (3,425 ) Cash at beginning of the period 2,891 6,316 Cash at end of the period $ 41,912 $ 2,891 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 — SUMMARY OF 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 (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The accompanying consolidated financial statements include the financial statements of the Company, its wholly owned subsidiaries, and entity which it consolidated the operation and financial results through VIE Agreements from the July 1, 2021 to the termination date of VIE Agreements. All inter-company balances and transactions are eliminated upon consolidation. Uses of estimates In preparing the consolidated financial statements in conformity U.S. GAAP, the 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 consolidated 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 advance to suppliers, inventory valuations, useful lives of property and equipment and intangible assets, the recoverability of long-lived assets, realization of deferred tax assets, and provision necessary for contingent liabilities. Actual results could differ from those estimates. Risks and uncertainties The main 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 economy in the PRC. 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, such experience may not be indicative of future results. The Company’s business, financial condition and results of operations may also be negatively impacted by risks related to natural disasters, extreme weather conditions, health epidemics and other catastrophic incidents, which could significantly disrupt the Company’s operations. The Company’s operations may be further affected by the ongoing outbreak of COVID-19 pandemic. A COVID-19 resurgence could negatively affect the execution of the Company’s sales contract and fulfilment of customer orders and the collection of the payments from customers on a timely manner. The Company will continue to monitor and modify the operating strategies in response to the COVID-19. The extent of the future impact of COVID-19 is still highly uncertain and cannot be predicted as of the date the Company’s financial statements are released. Concentration of credit risks Financial instruments that potentially subject the Company to significant concentration of credit risk consist primarily of cash and accounts receivable. As of June 30, 2023, the aggregate amounts of cash of $6,413,367 was deposited at major financial institutions located in the PRC and Hong Kong. In the event of bankruptcy of one of these financial institutions, the Company may not be able to claim its cash and demand deposits back in full. Management believes that these financial institutions are of high credit quality and continually monitors the credit worthiness of these financial institutions. Accounts receivable are typically unsecured and derived from revenue earned from customers in the PRC, which are exposed to credit risk. The risk is mitigated by credit evaluations. The Company maintains an allowance for doubtful accounts, and actual losses have generally been within management’s expectations. Refer to “Note 15. Concentrations” for detail. Interest rate risk The Company’s exposure to interest rate risk primarily relates to the interest income generated by excess cash, which is mostly held in interest-bearing bank deposits. The Company’s exposure to interest rate risk also arises from borrowings that have a floating rate of interest. The costs of floating rate borrowings may be affected by the fluctuations in the interest rates. The Company have not been, and do not expect to be, exposed to material interest rate risks, and therefore have not used any derivative financial instruments to manage such interest risk exposure. The Company has not been exposed to material risks due to changes in market interest rates, and not used any derivative financial instruments to manage the interest risk exposure during the year ended June 30, 2023. Cash Cash includes currency on hand and deposits held by banks that can be added or withdrawn without limitation. The Company maintains all of its bank accounts in the PRC. The Company’s cash balances in these bank accounts in the PRC are not insured by the Federal Deposit Insurance Corporation or other programs. Restricted cash Restricted cash consists of cash deposited with the PRC banks and used as collateral to secure the Company’s short-term bank loans. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash Notes receivable Notes receivable represent banks’ acceptances that have been arranged with third-party financial institutions by certain customers to settle their purchases from us. These notes receivable are non-interest bearing and are collectible within six to twelve months. As of June 30, 2023 and 2022, the Company had nil Accounts receivable, net Accounts receivable are presented net of allowance for doubtful accounts. The Company reduces accounts receivable by recording an allowance for doubtful accounts to account for the estimated impact of collection issues resulting from a client’s inability or unwillingness to pay valid obligations to the Company. The Company determines the adequacy of allowance for doubtful accounts based on individual account analysis, historical collection trend, and best estimate of specific losses on individual exposures. The Company establishes a provision for doubtful receivable when there is objective evidence that the Company may not be able to collect amounts due. Actual amounts received may differ from management’s estimate of credit worthiness and the economic environment. Delinquent account balances are written-off against the allowance for doubtful accounts after the management has determined that the likelihood of collection is not probable. Allowance for uncollectable balances amounted to nil Inventories, net Inventories are comprised of purchased electronic components products to be sold to customers. Inventories are stated at the lower of cost or net realizable value, determined using primarily an average weighted cost method. The Company reviews its inventories periodically to determine if any reserves are necessary for potential shrinkage and obsolete or unusable inventory. Inventory allowance amounted to$1,851 and nil Advances to suppliers, net Advances to suppliers consists of balances paid to suppliers for purchase of electronic components that have not been provided or received. Advances to suppliers are short-term in nature and are reviewed periodically to determine whether their carrying value has become impaired. The Company considers the assets to be impaired if the collectability of the advance becomes doubtful. The Company uses the aging method to estimate the allowance for uncollectible balances. In addition, at each reporting date, the Company generally determines the adequacy of allowance for doubtful accounts by evaluating all available information, and then records specific allowances for those advances based on the specific facts and circumstances. As of June 30, 2023 and 2022, there was no allowance recorded as the Company considers all of the advances to be fully realizable. Short-term investments The Company’s short-term investments consist of wealth management financial products purchased from PRC banks with maturities ranging from one month to twelve months. The banks invest the Company’s fund in certain financial instruments including money market funds, bonds or mutual funds, with rates of return on these investments ranging from 1.5% to 2.5% per annum. The carrying values of the Company’s short-term investments approximate fair value because of their short-term maturities. The interest earned is recognized in the consolidated statements of income and comprehensive income over the contractual term of these investments (see Note 6). Leases On July 1, 2021, the Company adopted Accounting Standards Update (“ASU”) 2016-02, Leases (as amended by ASU 2018-01, 2018-10, 2018-11, 2018-20, and 2019-01, collectively “ASC 842”) using the modified retrospective basis and did not restate comparative periods as permitted under ASU 2018-11. ASC 842 requires that lessees recognize ROU assets and lease liabilities calculated based on the present value of lease payments for all lease agreements with terms that are greater than twelve months. ASC 842 distinguishes leases as either a finance lease or an operating lease that affects how the leases are measured and presented in the statement of operations and statement of cash flows. For operating leases, the Company calculated ROU assets and lease liabilities based on the present value of the remaining lease payments as of the date of adoption. The remaining balance of lease liabilities are presented within current portion of operating lease liabilities and the non-current portion of operating lease liabilities on the consolidated balance sheets (see Note 10). Property and equipment Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation and amortization of property and equipment are provided using the straight-line method over their expected useful lives, as follows: Useful life Office equipment and furniture 3 years Automobiles 5 years Leasehold improvement Lesser of useful life and lease term 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 betterments 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 consolidated statements of income and comprehensive income. Intangible assets, net The Company’s intangible assets primarily consist of internal-use software development costs associated with the Company’s e-commerce platform. Intangible assets are carried at cost less accumulated amortization and any recorded impairment. The Company amortizes its intangible assets over useful lives of 10 year using a straight-line method, which reflects the estimated pattern in which the economic benefits of the internally developed software are to be consumed. Impairment of long-lived Assets Long-lived assets with finite lives, primarily property and equipment and intangible assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An asset is considered impaired if its carrying amount exceeds the future net undiscounted cash flows that the asset is expected to generate. If such asset is considered to be impaired, the impairment recognized is the amount by which the carrying amount of the asset, if any, exceeds its fair value determined using a discounted cash flow model. There were no impairments of these assets as of June 30, 2023 and 2022. Borrowings Borrowings comprise short-term borrowings. Borrowings are recognized initially at fair value, net of transaction costs incurred. Borrowings are subsequently stated at amortized cost; any difference between the proceeds net of transaction costs and the redemption value is recognized in profit or loss over the period of the borrowings using the effective interest method. Accounts payable The Company’s accounts payable (“AP”) primarily include balance due to suppliers for purchase of electronic components products. Deferred initial public offering (“IPO”) costs The Company complies with the requirement of the ASC 340-10-S99-1 and SEC Staff Accounting Bulletin (“SAB”) Topic 5A — “Expenses of Offering”. Deferred offering costs consist of underwriting, legal, consulting and other expenses incurred through the balance sheet date that are directly related to the intended IPO. Deferred offering costs will be charged to shareholders’ equity upon the completion of the IPO. Should the IPO prove to be unsuccessful, these deferred costs, as well as additional expenses to be incurred, will be charged to operations. Deferred IPO costs as included in “prepaid expenses and other current assets” amounted to nil Fair value of financial instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A three-level fair value hierarchy prioritizes the inputs used to measure fair value. The hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows: ● Level 1 — inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. ● Level 2 — inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, quoted market prices for identical or similar assets in markets that are not active, inputs other than quoted prices that are observable and inputs derived from or corroborated by observable market data. ● Level 3 — inputs to the valuation methodology are unobservable. Unless otherwise disclosed, the fair value of the Company’s financial instruments, including cash, restricted cash, short-term investments, notes receivable, accounts receivable, advances to suppliers, inventories, prepaid expenses and other current assets, short-term bank loans, short-term borrowings — third-party loans, notes payable, accounts payable, deferred revenue, taxes payable, due to related parties, accrued expenses operating lease liabilities-current, and other current liabilities approximate the fair value of the respective assets and liabilities as of June 30, 2023 and2022 based upon the short-term nature of the assets and liabilities. Foreign currency translation The functional currency for ICZOOM, ICZOOM HK, Ehub, Hjet HK and Components Zone HK is the U.S Dollar (“US$”). The Company primarily operates its business through its PRC subsidiaries as of June 30, 2022. The functional currency of the Company’s PRC subsidiaries and the VIE is the Chinese Yuan (“RMB”). The Company’s consolidated financial statements have been translated into US$. Assets and liabilities accounts are translated using the exchange rate at each reporting period end date. Equity accounts are translated at historical rates. Income and expense accounts are translated at the average rate of exchange during the reporting period. The resulting translation adjustments are reported under other comprehensive income. Gains and losses resulting from the translations of foreign currency transactions and balances are reflected in the results of operations. The RMB is not freely convertible into foreign currency and all foreign exchange transactions must take place through authorized institutions. No representation is made that the RMB amounts could have been, or could be, converted into US$ at the rates used in translation. The following table outlines the currency exchange rates that were used in creating the consolidated financial statements in this report: June 30, June 30, Period-end spot rate US$1=RMB 7.2254 US$1=RMB 6.7114 Average rate US$1=RMB 6.9881 US$1=RMB 6.4641 Revenue recognition ASC 606 establishes principles for reporting information about the nature, amount, timing and uncertainty of revenue and cash flows arising from the entity’s contracts to provide goods or services to customers. The core principle requires an entity to recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration that it expects to be entitled to receive in exchange for those goods or services recognized as performance obligations are satisfied. This new guidance provides a five-step analysis in determining when and how revenue is recognized. Under the new guidance, revenue is recognized when a customer obtains control of promised goods or services and is recognized in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. In addition, the new guidance requires disclosure of the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The Company currently generates its revenue from the following main sources: Revenue from sales of electronic components to customers The Company operates a B2B online platform www.iczoomex.com The Company accounts for revenue from sales of electronic components on a gross basis as the Company is responsible for fulfilling the promise to provide the desired electronic component products to customers, and is subject to inventory risk before the product ownership and risk are transferred and has the discretion in establishing prices. All of the Company’s contracts are fixed price contracts and have one single performance obligation as the promise is to transfer the individual goods to customers, and there is no separately identifiable other promises in the contracts. The Company’s revenue from sales of electronic components is recognized at a point in time when title and risk of loss passes and the customer accepts the goods, which generally occurs at delivery. Advance payment from customers is recorded as deferred revenue first and then recognized as revenue when products are delivered to the customers and the Company’s performance obligations are satisfied. The Company does not routinely allow customers to return products and historically return allowance was immaterial. There is no separate rebate, discount, or volume incentive involved. Revenue is reported net of all value added taxes (“VAT”). Service commission fees The Company’s service commission fees primarily consist of (1) fees charged to customers for assisting them for customs clearance when they directly purchase electronic component products from overseas suppliers; (2) fees charged to customers for providing temporary warehousing and organizing the product shipping and delivery to customer designated destinations after customs clearance. There is no separately identifiable other promises in the contracts. The Company merely acts as an agent in this type of transaction and earns a commission fee ranging from 0.15% to 1.5% based on the value of the merchandise that customers purchase from suppliers and such commission fee is not refundable. The Company does not have control of the goods in this type of transaction, has no discretion in establishing prices and does not have the ability to direct the use of the goods to obtain substantially all the benefits. Such revenue is recognized at the point when the Company’s customs clearance, warehousing, logistic and delivery services are performed and the customer receive the products. Revenues are recorded net of sales taxes and value added taxes. Contract Assets and Liabilities The Company did not have contract assets as of June 30, 2023 and 2022. Contract liabilities are recognized for contracts where payment has been received in advance of delivery. The Company’s contract liabilities, which are reflected in its consolidated balance sheets as deferred revenue of $1,671,353 and $3,651,700 as of June 30, 2023 and 2022, respectively. Costs of fulfilling customers’ purchase orders, such as shipping, handling and delivery, which occur prior to the transfer of control, are recognized in selling expense when incurred. Disaggregation of revenue The Company disaggregates its revenue from contracts by product and service types, as the Company believes it best depicts how the nature, amount, timing and uncertainty of the revenue and cash flows are affected by economic factors. The summary of the Company’s total revenues by product and service type for the year ended June 30, 2023 and 2022 was as follows: For the years ended 2023 2022 Sales of electronic components products: Semiconductor: Integrated Circuits $ 36,208,767 $ 155,134,814 Power/Circuit Protection 13,902,350 15,971,800 Discrete 16,047,821 23,071,808 Passive Components 99,326,417 25,110,572 Optoelectronics/Electromechanical 8,535,997 12,056,185 Other semiconductor products 15,366,941 29,103,445 Equipment, tools and others: Equipment 10,102,545 8,745,020 Tools and others 11,632,317 17,346,092 Total sales of electronic components products 211,123,155 286,539,736 Service commission fees 3,282,071 3,836,635 Total revenue $ 214,405,226 $ 290,376,371 Segment reporting An operating segment is a component of the Company that engages in business activities from which it may earn revenues and incur expenses, and is identified on the basis of the internal financial reports that are provided to and regularly reviewed by the Company’s chief operating decision maker in order to allocate resources and assess performance of the segment. The Company purchases electronic component products from third-party suppliers and then sells to customers. The Company’s products have similar economic characteristics with respect to vendors, marketing and promotions, customers and methods of distribution. The Company’s chief operating decision maker has been identified as the Chief Executive Officer, who reviews consolidated results when making decisions about allocating resources and assessing performance of the Company, and concludes that the Company has only one reporting segment. Shipping and handling costs Shipping and handling costs are expensed as incurred. Inbound shipping and handling cost associated with bringing the purchased electronic component products from suppliers to the Company’s warehouse are included in cost of revenue. Outbound shipping and handling costs associated with shipping and delivery the products to customers are included in selling expenses. For the years ended June 30, 2023 and 2022, shipping and handling costs included in cost of revenue amounted to $474,543 and $589,291 and shipping and handling costs included in selling expenses amounted to $423,606 and $445,840, respectively. Research and development The Company’s research and development activities primarily relate to development and implementation of its e-commerce platform and software. Research and development costs are expensed as incurred unless such costs qualify for capitalization as software development costs. In order to qualify for capitalization, (i) the preliminary project should be completed, (ii) management has committed to funding the project and it is probable that the project will be completed and the software will be used to perform the function intended, and (iii) it will result in significant additional functionality in the Company’s e-commerce platform. Capitalized software development costs amounted to $63,698 and $16,351 for the years ended June 30, 2023 and 2022, respectively. Research and development expenses included in general and administrative expenses amounted to $437,261 and $530,144 for the years ended June 30, 2023 and 2022, respectively, primarily comprising employee costs, and amortization and depreciation to intangible assets and property and equipment used in the research and development activities. 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. An uncertain tax position is recognized only if it is “more likely than not” that the tax position would be sustained in a tax examination. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded. Penalties and interest incurred related to underpayment of income tax are classified as income tax expense in the period incurred. No significant penalties or interest relating to income taxes have been incurred for the year ended June 30, 2023 and 2022. The Company does not believe that there was any uncertain tax provision at June 30, 2023 and 2022. The Company’s subsidiaries in Hong Kong are subject to the profit taxes in Hong Kong. The Company’s subsidiaries in China are subject to the income tax laws of the PRC. For the year ended June 30, 2023 and 2022, the Company generated income before taxes of $877,850 and $1,109,748 through its Hong Kong subsidiaries. As of June 30, 2023, all of the tax returns of the Company’s subsidiaries remain available for statutory examination by Hong Kong and PRC tax authorities. Value added tax (“VAT”) The Company is a general taxpayer and is subject to applicable VAT tax rate of 6% or 16%, and starting from April 1, 2019, the Company is subject to applicable VAT tax rate of 6% or 13%. VAT is reported as a deduction to revenue when incurred. Entities that are VAT general taxpayers are allowed to offset qualified input VAT tax paid to suppliers against their output VAT liabilities. Debt issuance costs Debt issuance costs related to a recognized debt liability are presented in the consolidated balance sheet as a direct deduction from the carrying amount of the debt liability, consistent with debt discounts. Amortization of debt origination costs is calculated using the effective interest method and is included as a component of interest expense. Earnings per Share The Company computes earnings per share (“EPS”) in accordance with ASC 260, “Earnings per Share” (“ASC 260”). 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 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. The following table sets forth the computation of basic and diluted earnings per share for the year ended June 30, 2023 and 2022: For the years ended 2023 2022 Numerator: Net income attributable to ordinary shareholders $ 1,751,170 $ 2,569,810 Denominator: Weighted-average number of ordinary shares outstanding – basic 9,201,374 8,826,374 Outstanding options 742,762 751,012 Potentially dilutive shares from outstanding options 717,557 720,972 Weighted-average number of ordinary shares outstanding – diluted 9,918,931 9,547,346 Earnings per share – basic $ 0.19 $ 0.29 Earnings per share – diluted $ 0.18 $ 0.27 Employee benefit plan The Company’s subsidiaries in the PRC participate in a government-mandated multi-employer defined contribution plan pursuant to which pension, work-related injury benefits, maternity insurance, medical insurance, unemployment benefit and housing fund are provided to eligible full-time employees. The relevant labor regulations require the Company’s subsidiaries in the PRC to pay the local labor and social welfare authorities monthly contributions based on the applicable benchmarks and rates stipulated by the local government. The contributions to the plan are expensed as incurred. Employee social security and welfare benefits included as expenses in the accompanying consolidated statements of income and comprehensive income amounted to $175,762 and $199,472 for the year ended June 30, 2023 and 2022, respectively. Comprehensive income Comprehensive income consists of two components, net income and other comprehensive income. The foreign currency translation gain or loss resulting from translation of the consolidated financial statements expressed in RMB to US$ is reported in other comprehensive income in the consolidated statements of comprehensive income. Statement of cash flows In accordance with ASC 230, “Statement of Cash Flows”, cash flows from the Company’s operations are formulated based upon the local currencies using the average exchange rate in the period. As a result, 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. Government subsidies Government subsidies are provided by the relevant PRC municipal government authorities to subsidize the cost of certain research and development projects. The Company recognizes government subsidies as other operating income when they are received because they are not subject to any past or future conditions, there are no performance conditions or conditions of use, and they are not subject to future refunds. Government subsidies received and recognized as other operating income totaled $125,125 and $213,741 for the years ended June 30, 2023 and 2022, respectively. Share-based compensation The Company grants stock options to eligible employees for services and accounts for share-based compensation in accordance with ASC 718, Compensation — Stock Compensation. Share-based compensation awards are measured at the grant date fair value of the awards and recognized as expenses using the straight-line method over the vesting period. The fair value of share options was determined using the binomial option valuation model, which requires the input of highly subjective assumptions, including the expected volatility, the exercise multiple, the risk-free rate and the dividend yield. For expected volatility, the Company has made reference to historical volatility of several comparable companies in the same industry. The exercise multiple was estimated as the average ratio of the stock price to the exercise price of when employees would decide to voluntarily exercise their vested share options. The risk-free rate for periods within the contractual life of the share options is based on the market yield of U.S. Treasury Bonds in effect at the time of grant. The dividend yield is based on the expected dividend policy over the contractual life of the share options. Related parties and transactions The Company identifies related parties, and accounts for, discloses related party transactions in accordance with ASC 850, “Related Party Disclosures” and other relevant ASC standards. Parties, which can be a corporation or individual, are considered to be related if the Company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operational decisions. Companies are also considered to be related if they are subject to common control or common significant influence. Transactions between related parties commonly occurring in the normal course of business are considered to be related party transactions. Transactions between related parties are also considered to be related party transactions even though they may not be given accounting recognition. While ASC does not provide accounting or measurement guidance for such transactions, it nonetheless require |
Accounts Receivable, Net
Accounts Receivable, Net | 12 Months Ended |
Jun. 30, 2023 | |
Accounts Receivable, Net [Abstract] | |
ACCOUNTS RECEIVABLE, NET | NOTE 3 — ACCOUNTS RECEIVABLE, NET Accounts receivable consists of the following: June 30, June 30, Accounts receivable $ 76,690,246 $ 76,119,299 Less: allowance for doubtful accounts - (99,003 ) Accounts receivable, net $ 76,690,246 $ 76,020,296 The Company’s accounts receivable (“AR”) primarily includes balance due from customers when the Company’s products are sold and delivered to customers. All of the June 30, 2022 accounts receivable balance has been collected. Approximately 63.1% of the June 30, 2023 accounts receivable balance has been collected as of the date the Company’s interim consolidated financial statements for the year ended June 30, 2023 were issued. The following table summarizes the Company’s outstanding accounts receivable and subsequent collection by aging bucket: Balance as of Subsequent % of AR aged less than 6 months $ 76,401,424 48,068,811 62.9 % AR aged from 7 to 12 months 288,822 288,822 100.0 % Accounts Receivable $ 76,690,246 48,357,633 63.1 % Balance as of Subsequent % of AR aged less than 6 months $ 74,233,261 $ 74,233,261 100.0 % AR aged from 7 to 12 months 1,886,038 1,886,038 100.0 % Accounts Receivable $ 76,119,299 $ 76,119,299 100.0 % Allowance for doubtful accounts movement is as follows: June 30, June 30, Beginning balance $ 99,003 $ 133,059 Reversal (99,003 ) (30,187 ) Foreign currency translation adjustments - (3,869 ) Ending balance $ - $ 99,003 |
Inventories, Net
Inventories, Net | 12 Months Ended |
Jun. 30, 2023 | |
Inventories, Net [Abstract] | |
INVENTORIES, NET | NOTE 4 — INVENTORIES, NET Inventories, net, consist of the following: June 30, June 30, Semiconductors $ 764,592 $ 324,410 Equipment, tools and others 71,117 41,205 Inventory valuation allowance (1,851 ) — Total inventory, net $ 833,858 $ 365,615 |
Advances To Suppliers
Advances To Suppliers | 12 Months Ended |
Jun. 30, 2023 | |
Advances To Suppliers [Abstract] | |
ADVANCES TO SUPPLIERS | NOTE 5 — ADVANCES TO SUPPLIERS Advances to suppliers, net, consist of the following: June 30, June 30, Advances to suppliers $ 1,608,941 $ 6,613,280 Advances to suppliers represents balance paid to various suppliers for purchase of electronic components that have not been delivered. These advances are interest free, unsecured and short-term in nature and are reviewed periodically to determine whether their carrying value has become impaired. As of June 30, 2023 and 2022, there was no allowance recorded as the Company considers all of the advances to suppliers balance fully realizable. The June 30, 2022 advance to supplier balance has been fully realized in fiscal year 2023. Approximately 86.2% or $1.4 million of the June 30, 2023 advance to suppliers balance has been realized as of the date the Company’s consolidated financial statements for the year ended June 30, 2023 were issued. |
Short-Term Invstment
Short-Term Invstment | 12 Months Ended |
Jun. 30, 2023 | |
Short-Term Invstment [Abstract] | |
SHORT-TERM INVSTMENT | NOTE 6 — SHORT-TERM INVSTMENT The Company’s short-term investments consist of wealth management financial products purchased from PRC banks with maturities ranging from one month to twelve months. The banks invest the Company’s fund in certain financial instruments including money market funds, bonds or mutual funds, with rates of return on these investments ranging from 1.5% to 2.5% per annum. Short-term investment consisted of the following: June 30, June 30, Beginning balance $ 1,490 $ 928,800 Add: purchase additional wealth management financial products 4,125,704 20,025,600 Less: proceeds received upon maturity of short-term investment (4,127,088 ) (20,918,110 ) Foreign currency translation adjustments (106 ) (34,800 ) Ending balance of short-term investment $ - $ 1,490 Interest income generated from short-term investment amounted to $14,748 and $30,775 for the years ended June 30, 2023 and 2022, respectively. |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 12 Months Ended |
Jun. 30, 2023 | |
Prepaid Expenses And Other Current Assets [Abstract] | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | NOTE 7 — PREPAID EXPENSES AND OTHER CURRENT ASSETS Prepaid expenses and other current assets consist of the following: June 30, June 30, Other receivables, net (1) $ 1,286,920 $ 1,706,767 Deferred initial public offering costs (2) - 629,748 Prepaid expenses (3) 54,281 96,398 Prepaid expenses and other current assets $ 1,341,201 $ 2,432,913 (1) Other receivable primarily includes prepaid VAT input tax in connection with the Company’s purchase of electronic component products from third-party suppliers when VAT invoices have not been received as of the balance sheet date. Other receivable also includes, advances to employees for business development and security deposits for operating leases. As of June 30, 2023, the balance of other receivable mainly consists of $892,703 of prepaid VAT input tax, $21,910 of advances to employees and $317,459 of security deposits for operating leases. All the June 30, 2022 other receivable balance and approximately 74.9% of the June 30, 2023 other receivable balance has been collected or settled. (2) Deferred initial public offering costs of nil (3) Prepaid expenses include mainly prepayment for rental expense and equipment maintenance, etc. |
Property and Equipment, Net
Property and Equipment, Net | 12 Months Ended |
Jun. 30, 2023 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT, NET | NOTE 8 — PROPERTY AND EQUIPMENT, NET Property and equipment, net, consists of the following: June 30, June 30, Office equipment and furniture $ 151,007 $ 140,695 Automobiles 69,782 62,580 Leasehold improvement 403,778 369,065 Subtotal 624,567 572,340 Less: accumulated depreciation (498,535 ) (453,096 ) Property and equipment, net $ 126,032 $ 119,244 Depreciation expense was $65,471 and $29,887 for the years ended June 30, 2023 and 2022, respectively. |
Intangible Assets, Net
Intangible Assets, Net | 12 Months Ended |
Jun. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS, NET | NOTE 9 — INTANGIBLE ASSETS, NET Intangible assets, net, mainly consist of the following: June 30, June 30, Capitalized internal-use software development costs $ 905,431 $ 905,375 Less: accumulated amortization (616,995 ) (527,037 ) Intangible assets, net $ 288,436 $ 378,338 Amortization expense was $131,762 and $118,184 for the years ended June 30, 2023 and 2022, respectively. Estimated future amortization expense for intangible assets is as follows: Twelve months ending June 30, Amortization 2024 $ 88,821 2025 78,094 2026 76,316 2027 30,840 2028 11,241 Thereafter 3,124 $ 288,436 |
Leases
Leases | 12 Months Ended |
Jun. 30, 2023 | |
Leases [Abstract] | |
LEASES | NOTE 10 — LEASES The Company’s PRC subsidiaries and VIE entered into operating lease agreements with landlords to lease warehouse and office space. As of June 30, 2023, the remaining lease term was 1.9 years. The Company’s lease agreements do not provide a readily determinable implicit rate nor is it available to the Company from its lessors. Instead, the Company estimates its incremental discount rate based on the interest rate for three-year government bond as published by China’s central bank in order to discount lease payments to present value. The discount rate of the Company’s operating leases was 3.35%. For the years ended June 30, 2023 and 2022, there was no variable lease cost. For the years ended June 30, 2023 and 2022, total operating lease expense amounted to $432,422 and $582,631 respectively, and amortization of the operating lease right-of-use assets amounted to $381,795 and 41,968, respectively. For the year ended June 30, 2023, the interest on lease liabilities amounted to $28,685. Supplemental balance sheet information related to operating leases was as follows: The table below presents the operating lease related assets and liabilities recorded on the balance sheets. June 30, June 30, Operating lease right-of-use assets $ 1,274,479 732,993 Operating lease right-of-use assets – accumulated amortization (411,627 ) (40,422 ) Operating lease right-of-use assets – net $ 862,852 692,571 Operating lease liabilities, current 524,698 232,221 Operating lease liabilities, non-current 375,056 480,436 Total operating lease liabilities, $ 899,754 712,657 As of June 30, 2023, maturities of operating lease liabilities were as follows: Twelve months ending June 30, June 30, 2024 549,919 2025 376,604 Total future minimum lease payments 926,523 Less: Imputed interest (26,769 ) Total $ 899,754 |
Debt
Debt | 12 Months Ended |
Jun. 30, 2023 | |
Debt Disclosure [Abstract] | |
DEBT | NOTE 11 — DEBT The Company borrowed from PRC banks, other financial institutions and third parties as working capital funds. As of June 30, 2023 and 2022, the Company’s debt consisted of the following: (a) Short-term loans: June 30, June 30, Shanghai Pudong Development Bank (1) $ 4,152,000 $ 5,000,000 Agricultural Bank of China (2) 2,750,000 3,200,000 Industrial and Commercial Bank of China (3) 2,400,000 2,600,000 Bank Of China (4) 4,732,116 1,008,400 Less: Debt issuance cost (5) (11,593 ) (48,013 ) Total short-term loans, net $ 14,022,523 $ 11,760,387 (1) On March 15, 2022, the Company borrowed $2.7 million short-term loan from Shanghai Pudong Development Bank (“SPD”) bank as working capital for six months, with loan maturity date on September 13, 2022 and effective interest rate of 4.2% per annum. The loan borrowed was guaranteed by the Company’s certain shareholders. The loan was fully repaid upon maturity. On March 24, 2022, the Company borrowed $2.3 million short-term loan from SPD bank as working capital for six months, with loan maturity date on September 20, 2022 and effective interest rate of 4.2% per annum. The loan borrowed was guaranteed by the Company’s certain shareholders. The loan was fully repaid upon maturity. On September 21, 2022, the Company borrowed RMB¥13.9 million (approximately $2.0 million) short-term loan from SPD bank as working capital for six months, with loan maturity date on March 20, 2023 and effective interest rate of 4.64% per annum. The loan borrowed was guaranteed by the Company’s certain shareholders. The loan was fully repaid upon maturity. On September 23, 2022, the Company borrowed RMB¥16.1 million (approximately $2.3 million) short-term loan from SPD bank as working capital for six months, with loan maturity date on March 22, 2023 and effective interest rate of 4.64% per annum. The loan borrowed was guaranteed by the Company’s certain shareholders. The loan was fully repaid upon maturity. On March 21, 2023, the Company borrowed RMB13.9 million (approximately USD$2.0 million) short-term loan from SPD bank as working capital for six months, with loan maturity date on September 17, 2023 and effective interest rate of 4.64% per annum. The loan borrowed was guaranteed by the Company’s certain shareholders. The loan was fully repaid before maturity on April 23, 2023. On March 30, 2023, the Company borrowed RMB16.1 million (approximately USD$2.2 million) short-term loan from SPD bank as working capital for six months, with loan maturity date on September 26, 2023 and effective interest rate of 4.64% per annum. The loan borrowed was guaranteed by the Company’s certain shareholders. The loan was fully repaid upon maturity. On April 25, 2023, the Company borrowed RMB13.9 million (approximately USD$1.9 million) short-term loan from SPD bank as working capital for six months, with loan maturity date on October 20, 2023 and effective interest rate of 2.85% per annum. The loan borrowed was guaranteed by the Company’s certain shareholders. The loan was fully repaid upon maturity. For the above-mentioned loans from SPD bank, certain shareholders of the Company provided joint guarantees to these loans by pledging their personal properties as collaterals. (2) On February 25, 2022, the Company signed a new loan contract with Agricultural Bank of China (“ABC bank”) to borrow $3.2 million as working capital, with loan maturity date on August 22, 2022 and effective interest rate of 1.9% per annum. The loan was guaranteed by the Company’s certain shareholders and related parties. The loan was fully repaid upon maturity. On August 24, 2022, the Company signed a new loan contract with ABC bank to borrow $3.0 million as working capital, with loan maturity date on February 19, 2023 and effective interest rate of 4.0% per annum. The loan was guaranteed by the Company’s certain shareholders and related parties. The loan was fully repaid upon maturity. On February 22, 2023, the Company borrowed $2.75 million on short-term loan from ABC as working capital for six months, with loan maturity date on August 18, 2023 and effective interest rate of 5.69% per annum. The loan was fully repaid upon maturity. For the above-mentioned loans from ABC bank, certain shareholders of the Company provided joint guarantees to these loans by pledging their personal properties as collaterals. (3) On May 17, 2022, the Company borrowed $1.3 million short-term loan from Industrial and Commercial Bank of China (“ICBC”) as working capital for three months, with loan maturity date on August 12, 2022 and effective interest rate of 2.1% per annum. The loan was fully repaid upon maturity. On June 7, 2022, the Company borrowed $1.3 million short-term loan from ICBC as working capital for three months, with loan maturity date on September 5, 2022 and effective interest rate of 2.15% per annum. The loan was fully repaid upon maturity. On August 15, 2022, the Company borrowed $1.3 million short-term loan from ICBC as working capital for three months, with loan maturity date on November 9, 2022 and effective interest rate of 3.1% per annum. The loan was fully repaid upon maturity. On September 9, 2022, the Company borrowed $1.2 million short-term loan from ICBC as working capital for three months, with loan maturity date on December 7, 2022 and effective interest rate of 3.19% per annum. The loan was fully repaid upon maturity. On November 14, 2022, the Company borrowed $1.0 million short-term loan from ICBC as working capital for three months, with loan maturity date on February 8, 2023 and effective interest rate of 5.20% per annum. The loan was fully repaid upon maturity. On December 9, 2022, the Company borrowed $1.2 million short-term loan from ICBC as working capital for three months, with loan maturity date on March 8, 2023 and effective interest rate of 4.81% per annum. The loan was fully repaid upon maturity. On February 9, 2023, the Company borrowed $1.3 million short-term loan from ICBC as working capital for three months, with loan maturity date on May 9, 2023 and effective interest rate of 5.11% per annum. The loan was fully repaid upon maturity. On March 10, 2023, the Company borrowed $1.2 million short-term loan from ICBC as working capital for three months, with loan maturity date on June 7, 2023 and effective interest rate of 4.95% per annum. The loan borrowed from ICBC Bank was guaranteed by the Company’s certain shareholders. The loan was fully repaid upon maturity. On May 11, 2023, the Company borrowed $1.3 million short-term loan from ICBC as working capital for three months, with loan maturity date on August 8, 2023 and effective interest rate of 5.56% per annum. The loan borrowed from ICBC Bank was guaranteed by the Company’s certain shareholders. The loan was fully repaid upon maturity. On June 9, 2023, the Company borrowed $1.1 million short-term loan from ICBC as working capital for three months, with loan maturity date on September 5, 2023 and effective interest rate of 5.52% per annum. The loan borrowed from ICBC Bank was guaranteed by the Company’s certain shareholders. The loan was fully repaid upon maturity. For the above-mentioned loans from ICBC bank, certain shareholders of the Company provided joint guarantees to these loans by pledging their personal properties as collaterals. (4) On June 24, 2022, the Company borrowed GBP£0.82 million (approximately $1.0 million) short-term loan from Bank of China as working capital for twelve months, with loan maturity date on June 21, 2023 and effective interest rate of 1.91% per annum. The loan was pledged by a term deposit of JPY ¥136,300,000 (approximately $1.00 million). The loan was fully repaid upon maturity. On September 27, 2022, the Company borrowed GBP£0.92 million (approximately $1.2 million) short-term loan from Bank of China as working capital for twelve months, with loan maturity date on September 27, 2023 and effective interest rate of 4.51% per annum. The loan was pledged by a term deposit of JPY ¥144.7 million (approximately $1.06 million). The loan was fully repaid upon maturity. On November 21, 2022, the Company borrowed EUR 0.97 million (approximately $1.0 million) short-term loan from Bank of China as working capital for twelve months, with loan maturity date on November 21, 2023 and effective interest rate of 2.58% per annum. The loan was pledged by a term deposit of GBP£0.84 million (approximately $1.03 million). The loan was fully repaid upon maturity. On March 28, 2023, the Company borrowed HKD11.8 million (approximately $1.5 million) short-term loan from Bank of China as working capital for twelve months, with loan maturity date on March 27, 2024 and effective interest rate of 3.02% per annum. The loan was pledged by a term deposit of JPY ¥196.8 million (approximately $1.48 million). The loan was fully repaid upon maturity. On June 28, 2023, the Company borrowed GBP£0.8 million (approximately $1.0 million) short-term loan from Bank of China as working capital for twelve months, with loan maturity date on June 27, 2024 and effective interest rate of 6.02% per annum. The loan was pledged by a term deposit of JPY ¥144.0 million (approximately $1.0 million). The loan was fully repaid upon maturity. (5) In order to obtain the above-mentioned loans from PRC banks, as of June 30 2023 and 2022, the Company incurred total of $292,998 and $142,430 loan origination fees to be paid to above mentioned related parties for providing loan guarantees and pledging their personal assets as collaterals to safeguard the loans. The loan origination fees were recorded as deferred financing cost against the loan balances. For the year ended June 30, 2023 and 2022, $215,370 and $197,366 deferred financing cost was amortized, respectively. For the above-mentioned short-term loans from PRC banks and financial institutions, interest expense amounted to $530,568 and $293,102 f or the years ended June 30, 2023 and 2022, respectively. (b) Short-term borrowings- third-party loans From June to December 2022, the Company borrowed loans from an unrelated company as working capital, with loan maturity date ranging from November 2022 to March 2023, and effective interest rate of 3.6% per annum. As of June 30, 2023, the outstanding balance was $0. Total interest expense on these third-party loans amounted to $8,592 and $33,391 for the years ended June 30, 2023 and 2022, respectively. |
Accounts Payable
Accounts Payable | 12 Months Ended |
Jun. 30, 2023 | |
Accounts Payable [Abstract] | |
ACCOUNTS PAYABLE | NOTE 12 — ACCOUNTS PAYABLE The Company’s accounts payable (“AP”) primarily include balance due to suppliers for purchase of electronic components products. The June 30, 2022 accounts payable balance has been fully settled. Approximately 70.7% of the accounts payable balance as of June 30, 2023 has been settled as of the date the Company’s interim financial statements for the year ended June 30, 2023 were issued. The following table summarizes the Company’s outstanding accounts payable and subsequent settlement by aging bucket: Balance as of Subsequent % of Accounts payable aged less than 6 months $ 50,049,201 $ 35,071,648 70.1 % Accounts payable aged from 7 to 12 months 1,078,127 1,078,127 100.0 % Total accounts payable $ 51,127,328 $ 36,149,775 70.7 % Balance as of Subsequent % of Accounts payable aged less than 6 months $ 59,541,103 $ 59,541,103 100.0 % Accounts payable aged from 7 to 12 months 17,640 17,640 100.0 % Total accounts payable $ 59,558,743 $ 59,558,743 100.0 % |
Taxes
Taxes | 12 Months Ended |
Jun. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
TAXES | NOTE 13 — TAXES (a) Corporate Income Taxes (“CIT”) Cayman Islands Under the current tax laws of the Cayman Islands, the Company is not subject to tax on its income or capital gains. In addition, no Cayman Islands withholding tax will be imposed upon the payment of dividends by the Company to its shareholders. Hong Kong ICZOOM HK, Ehub, Hjet HK and Components Zone HK are incorporated in Hong Kong and are subject to profit taxes at a rate of 16.5% for taxable income earned in Hong Kong before April 1, 2018. Starting from the financial year commencing on or after April 1, 2018, the two-tiered profits tax rates regime took effect, under which the profits tax rate is 8.25% on assessable profits of the first HK$2 million and 16.5% on any assessable profits in excess of HK$2 million. There is an anti-fragmentation measure where each group will have to nominate only one company in the group to benefit from the progressive rates. As a result, Ehub is nominated by the Company and is subject to tax rate of 8.25% on the first HK$2 million of assessable profits and a tax rate of 16.5% on the remaining profits and ICZOOM HK, Hjet HK and Components Zone HK are subject to Hong Kong profit taxes at a rate of 16.5% for the years ended June 30, 2023 and 2022, respectively. PRC ICZOOM WFOE, Hjet Shuntong, ICZOOM Shenzhen, Hjet Supply Chain, Heng Nuo Chen, Hjet Logistics and Pai Ming Shenzhen are incorporated in the PRC, and are subject to the PRC Enterprise Income Tax Laws (“EIT Laws”) and are taxed at the statutory income tax rate of 25%. 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. ICZOOM Shenzhen, one of the Company’s ICZOOM Operating Entities in the PRC, was approved as HNTEs and is entitled to a reduced income tax rate of 15% beginning December 2020, which is valid for three years. (i) The components of the income tax provision from Cayman Islands, Hong Kong, and China are as follows: For the Years Ended June 30, 2023 2022 Current tax provision Cayman Islands $ — $ — Hong Kong 84,828 183,197 China 157,376 398,085 242,204 581,282 Deferred tax provision (benefit) Cayman Islands — — Hong Kong (305 ) — China 23,771 5,994 23,465 5,994 Income tax provision $ 265,670 $ 587,276 Reconciliation of the differences between the income tax provision computed based on PRC statutory income tax rate and the Company’s actual income tax provision for the years ended June 30, 2023 and 2022, respectively are as follows: For the Years Ended 2023 2022 Income tax expense computed based on PRC statutory rate $ 504,210 $ 709,419 Effect of rate differential for Hong Kong entities (110,932 ) (146,790 ) Non-deductible expenses: Stock-based compensation* 14,649 13,543 Meals and entertainment 3,375 4,067 Change in valuation allowance (145,632 ) 7,037 Actual income tax provision $ 265,670 $ 587,276 * The Company’s stock-based compensation expenses were recorded under the Cayman parent company level. Pursuant to the current tax laws of the Cayman Islands, the Company is not subject to tax on its income or capital gains. As a result, stock-based compensation expenses are non-deductible expenses for income tax purposes. Deferred tax assets The Company’s deferred tax assets are comprised of the following: June 30, June 30, Deferred tax assets derived from net operating loss (“NOL”) carry forwards $ 406,760 $ 576,432 Allowance for doubtful accounts - 24,751 Allowance of Inventory 305 Less: valuation allowance (406,760 ) (576,432 ) Deferred tax assets $ 305 $ 24,751 Movement of valuation allowance: June 30, June 30, Balance at beginning of the period $ 576,432 $ 726,607 Current period addition/(reversal) (169,672 ) 8,446 Effect due to the termination of VIE - (158,621 ) Balance at end of the period $ 406,760 $ 576,432 The Company periodically evaluates the likelihood of the realization of deferred tax assets, and reduces the carrying amount of the deferred tax assets by a valuation allowance to the extent it believes a portion will not be realized. Management considers new evidence, both positive and negative, that could affect the Company’s future realization of deferred tax assets including its recent cumulative earnings experience, expectation of future income, the carry forward periods available for tax reporting purposes and other relevant factors. The Company has four subsidiaries in HK, including ICZOOM HK, Components Zone HK, Hjet HK and Ehub, among which Components Zone HK were reported recurring operating losses since 2015 to June 2023. In addition, the Company also has five subsidiaries in the PRC, among which, ICZOOM Shenzhen were also reported recurring operating losses since 2015 to June 2023. Due to the termination of the VIE Agreements in December 2021, valuation allowance of $158,621 from Pai Ming Shenzhen as accrued in prior periods has been removed because the Company will no longer consolidate the operation results of the VIE, Pai Ming Shenzhen. Management concluded that the chances for the above-mentioned HK and PRC subsidiaries to be profitable in the foreseeable near future and to utilize their net operating loss carry forwards were uncertainty. Accordingly, the Company provided valuation allowance of $406,760 and $576,432 for the deferred tax assets of these subsidiaries for the years ended June 30, 2023 and 2022 respectively. (b) Taxes payable Taxes payable consist of the following: June 30, June 30, Income tax payable $ 2,363,980 $ 2,445,687 Value added tax payable 568,157 229,315 Total taxes payable $ 2,932,137 $ 2,675,002 |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Jun. 30, 2023 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 14 — RELATED PARTY TRANSACTIONS a. Due to related parties Due to related parties consists of the following: Name Related party relationship June 30, June 30, Mrs. Duanrong Liu Shareholder, Director and Chief Operating Officer $ 1,451,842 $ 282,336 Mr. Lei Xia Shareholder, Chairman and Chief Executive Officer 21,943 28,884 Other shareholders Shareholders of the Company 34,981 38,464 Total due to related parties $ 1,508,766 $ 349,684 As of June 30, 2023 and 2022, the balance due to related parties was loan advance from the Company’s shareholders and was used as working capital during the Company’s normal course of business. Such advance was non-interest bearing and due on demand. b. Loan guarantee provided by related parties In connection with the Company’s short-term borrowings from the PRC banks, the Company’s controlling shareholder and Chief Executive Officer and several other shareholders jointly signed guarantee agreements by pledging their personal properties with the banks to secure the bank loans. The Company also incurred loan origination fees of $292,998 and $142,430 as of June 30, 2023 and 2022 respectively, to be paid to these related parties for providing such loan guarantees (see Note 11). c. Consulting service arrangement with Pai Ming Shenzhen On December 10, 2021, the Company terminated the VIE Agreements with Pai Ming Shenzhen. On January 22, 2022, ICZOOM WFOE entered into a business cooperation agreement with Pai Ming Shenzhen, pursuant to which Pai Ming Shenzhen agreed to provide ICZOOM WFOE with network services including but not limited to business consultation, website information push, matching services of supply and demand information, online advertising, software customization, data analysis, website operation and other in-depth vertical services through online and offline data push, etc. over a one-year period, and ICZOOM WFOE has agreed to pay Pai Ming Shenzhen with a base monthly fixed fee of RMB100,000 and additional service fee based on the service performance of Pai Ming Shenzhen. After the termination of the VIE Agreement, Pai Ming Shenzhen was treated as a related party to the Company because the COO’s brother was one of the shareholders of Pai Ming Shenzhen. On April 19, 2022. the COO’s brother transferred all his ownership interest in Pai Ming Shenzhen to an unrelated individual and Pai Ming Shenzhen was no longer treated as a related party to the Company after April 19, 2022(see Note 1). Therefore, the consulting service paid to Pai Ming Shenzhen during the period from January 18, 2022 to April 19, 2022 accounted for as related party transactions was $48,885. |
Concentrations
Concentrations | 12 Months Ended |
Jun. 30, 2023 | |
Concentrations [Abstract] | |
Concentration Risk Disclosure [Text Block] | NOTE 15 — CONCENTRATIONS A majority of the Company’s revenue and expense transactions are denominated in RMB and a significant portion of the Company and its subsidiaries’ assets and liabilities are denominated in RMB. RMB is not freely convertible into foreign currencies. In the PRC, certain foreign exchange transactions are required by law to be transacted only by authorized financial institutions at exchange rates set by the People’s Bank of China (“PBOC”). Remittances in currencies other than RMB by the Company in China must be processed through the PBOC or other China foreign exchange regulatory bodies which require certain supporting documentation in order to affect the remittance. For the years ended June 30, 2023 and 2022, the Company’s substantial assets were located in the PRC and the Company’s substantial revenues excluding the intercompany transaction were derived from its subsidiaries located in the PRC. As of June 30, 2023 and 2022, $5,713,265 and $2,079,445 of the Company’s cash and restricted cash was on deposit at financial institutions in the PRC where there currently is no rule or regulation requiring such financial institutions to maintain insurance to cover bank deposits in the event of bank failure. As of June 30, 2023 and 2022, the Company’s substantial assets were located in the PRC and the Company’s substantial revenues excluding the intercompany transaction were derived from its subsidiaries and the VIE located in the PRC. For the years ended June 30, 2023 and 2022, no single customer accounted for more than 10% of the Company’s total revenue. The Company’s top 10 customers aggregately accounted for 26.7% and 24.1% of the total revenue for the year ended June 30, 2023 and 2022, respectively. As of June 30, 2023 and 2022, no customer accounted for more than 10% of the total accounts receivable balance. As of June 30, 2023 and 2022, no supplier accounted for more than 10% of the total advance to suppliers balance. As of June 30, 2023 and 2022, no single supplier accounted for more than 10% of the total accounts payable balance. For the years ended June 30, 2023 and 2022, no single supplier accounted for more than 10% of the Company’s total purchases. |
Shareholders' Equity
Shareholders' Equity | 12 Months Ended |
Jun. 30, 2023 | |
Stockholders' Equity Note [Abstract] | |
SHAREHOLDERS' EQUITY | NOTE 16 — SHAREHOLDERS’ EQUITY Ordinary shares The Company was incorporated under the laws of the Cayman Islands on June 23, 2015. The original authorized number of ordinary shares was 100 million shares with par value of US$0.02 per share (including 60,000,000 shares of Class A shares and 40,000,000 shares of Class B shares). Holders of Class A ordinary shares and Class B ordinary shares have the same rights except for voting and conversion rights. In respect of matters requiring a shareholder vote, each Class A ordinary share will be entitled to one vote and each Class B ordinary share will be entitled to ten votes. The Class A ordinary shares are not convertible into shares of any other class. The Class B ordinary shares are convertible into Class A ordinary shares at any time after issuance at the option of the holder on a one to one basis. On November 13, 2020, the Company amended its Memorandum of Association to reverse split the authorized number of shares at a ratio of 1-for-4 share to 25 million shares with par value of US$0.08 per share, and reverse split the issued shares from 70,610,963 shares at par value of US$0.02 per share to 17,652,743 ordinary shares with par value of $0.08 per share. The reverse split is considered part of the Reorganization of the Company, which was retroactively applied as if the transaction occurred at the beginning of the period presented. As a result of this revere split, the authorized number of Class A ordinary shares have been changed from 60,000,000 shares to 15,000,000 shares, and authorized number of Class B ordinary shares have been changed from 40,000,000 shares to 10,000,000 shares. On August 25, 2021, the Company amended its Memorandum of Association to increase the authorized shares of Class A ordinary shares from 15,000,000 shares to 60,000,000 shares with par value of $0.08 per share. As a result of this amendment, the total authorized ordinary shares has been changed from 25,000,000 shares (including 15,000,000 Class A ordinary shares and 10,000,000 Class B ordinary shares) to 70,000,000 shares (including 60,000,000 Class A ordinary shares and 10,000,000 Class B ordinary shares). On August 8, 2022, the Company amended its Memorandum of Association to reverse split the authorized number of shares at a ratio of 1-for-2 share to 35 million shares with par value of US$0.16 per share, and reverse split the issued shares from 17,652,743 shares at par value of US$0.08 per share to 8,826,374 ordinary shares with par value of $0.16 per share. The reverse split is considered part of the Reorganization of the Company, which was retroactively applied as if the transaction occurred at the beginning of the period presented (see Note1). As a result of this revere split, the authorized number of Class A ordinary shares have been changed from 60,000,000 shares to 30,000,000 shares, and authorized number of Class B ordinary shares have been changed from 10,000,000 shares to 5,000,000 shares. As of June 30, 2022, the Company had 8,826,374 ordinary shares issued and outstanding (including 4,996,874 shares of Class A ordinary shares and 3,829,500 shares of Class B ordinary shares). On March 15, 2023, the Company completed the initial public offering in Nasdaq Capital market and issued 1,500,000 Class A ordinary shares. As of June 30, 2023, the Company had 10,326,374 ordinary shares issued and outstanding (including 6,496,874 shares of Class A ordinary shares and 3,829,500 shares of Class B ordinary shares). Statutory reserve and restricted net assets Relevant PRC laws and regulations restrict the Company’s PRC subsidiaries and the VIE from transferring a portion of their net assets, equivalent to their statutory reserves and their share capital, to the Company in the form of loans, advances or cash dividends. Only PRC entities’ accumulated profits may be distributed as dividends to the Company without the consent of a third party. 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. The statutory reserve may be applied against prior year losses, if any, and may be used for general business expansion and production or increase in registered capital, but are not distributable as cash dividends. The payment of dividends by entities organized in China is subject to limitations, procedures and formalities. Regulations in the PRC currently permit payment of dividends only out of accumulated profits as determined in accordance with accounting standards and regulations in China. The results of operations reflected in the consolidated financial statements prepared in accordance with U.S GAAP differ from those in the statutory financial statements of the WFOE and its subsidiaries and VIE. Remittance of dividends by a wholly foreign-owned company out of China is subject to examination by the banks designated by State Administration of Foreign Exchange. In light of the foregoing restrictions, the Company’s PRC subsidiaries and the VIE and are restricted in their ability to transfer their net assets to the Company. Foreign exchange and other regulations in the PRC may further restrict the WFOE, the VIE and the Company’s PRC subsidiaries from transferring funds to the Company in the form of dividends, loans and advances. As of June 30, 2023 and 2022, the restricted amounts as determined pursuant to PRC statutory laws totaled $624,097 and $624,097, respectively. As of June 30, 2023 and 2022, the Company’s total restricted net assets amounted to $21,071,864 and $16,535,529, respectively. |
Share-Based Compensation
Share-Based Compensation | 12 Months Ended |
Jun. 30, 2023 | |
Share-Based Compensation [Abstract] | |
Share-Based Payment Arrangement [Text Block] | NOTE 17 — SHARE-BASED COMPENSATION On October 5, 2015, the Company’s Board of Directors approved the 2015 Equity Incentive Plan (the “Plan”) for the purpose of providing incentive and rewards to employees and executives. According to the Plan, 50,000,000 of the Company’s Class A ordinary shares was reserved for issuance to qualified employees, directors and officers. Given the reverse split on November 13, 2020 and August 8, 2022 (see Note 16), number of ordinary shares reserved for issuance changed to 6,250,000 shares. Under the Plan, the following stock-based compensations have been granted to the Company’s employees, directors and officers (number of option shares and exercise price reflected the effect of the1-for-4 share reverse split on November 13, 2020 and the effect of the1-for-2 share reverse split on August 8, 2022): (1) On October 5, 2015, options to purchase 795,644 shares of the Company’s Class A ordinary shares have been granted at an exercise price of $0.16 per share. These share options will vest equally over a service period of four (2) On December 26, 2016, options to purchase 64,250 shares of the Company’s Class A ordinary shares has been granted at an exercise price of $0.16 per share. These share options will vest equally over a service period of four (3) On December 22, 2017, options to purchase 213,125 of the Company’s Class A ordinary shares have been granted at an exercise price of $0.16. These option shares will vest equally over a service period of four (4) On December 21, 2018, options to purchase 44,250 of the Company’s Class A ordinary shares have been granted at an exercise price of $0.16 per share. These option shares will vest equally over a service period of four (5) On January 15, 2020, options to purchase 33,788 shares of the Company’s Class A ordinary shares have been granted at an exercise price of $2.40 per share. These option shares vest equally over a service period of four The following table summarizes the Company’s stock option activities: Number of Weighted Weighted Fair Value Outstanding, June 30, 2021 960,174 $ 0.18 2.80 $ 2,551,737 Exercisable, June 30, 2021 949,093 $ 0.16 2.76 $ 2,470,526 Granted — — — — Forfeited (209,162 ) 0.16 — (1,672,892 ) Exercised — — — — Outstanding, June 30, 2022 751,012 0.16 1.05 $ 878,845 Exercisable, June 30, 2022 749,440 0.17 1.04 $ 869,478 Granted — — — — Forfeited (8,250 ) 0.16 — (49,159 ) Exercised — — — — Outstanding, June 30, 2023 742,762 0.18 0.05 $ 829,686 Exercisable, June 30, 2023 742,762 0.18 0.05 $ 829,686 The fair value of share options was determined using the binomial option valuation model. The binomial model requires the input of highly subjective assumptions, including the expected share price volatility and the suboptimal early exercise factor. The risk-free rate for periods within the contractual life of the options is based on the market yield of U.S. Treasury Bonds in effect at the time of grant. For expected volatilities, the Company has made reference to historical volatilities of several comparable companies. The suboptimal early exercise factor was estimated based on the Company’s expectation of exercise behavior of the grantees. The Company’s management is ultimately responsible for the determination of the estimated fair value of its ordinary shares. There were no options granted under the Plan for the year ended June, 2023. On March 19, 2021, pursuant to the Plan, the Company’s Board of Directors approved to grant 68 employees the options to purchase 579,100 shares of the Company’s ordinary shares at an exercise price of $2.40 per share. These option shares will vest equally over a service period of four The total fair value of share options vested the year ended June, 2023 and 2022 was $9,366 and $71,845, respectively. The Company recorded share-based compensation expense of $102,783 and $54,717 for the year ended June 30, 2023 and 2022, respectively. For the year ended June 30, 2022, 209,143 outstanding share options were forfeited due to the resignation of certain employees, resulting in a decrease in the unrecognized share-based compensation expenses by $531,616. As of June 30, 2023 and 2022, there were Nil |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Jun. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 18 — COMMITMENTS AND CONTINGENCIES Operating lease commitment The operating lease commitments presented above mainly consist of the short-term lease commitments and leases that have not yet commenced but that create significant rights and obligations for the Company, which are not included in operating lease right-of–use assets and lease liabilities. For the years ended June 30, 2023 and 2022, total operating lease expense amounted to $432,422 and $582,631, respectively. As of June 30, 2023, future minimum lease payments under non-cancelable operating lease agreement are as follows: Twelve Months ended June 30, Lease 2024 $ 144,803 2025 93,757 Total 238,560 Contingencies From time to time, the Company is a party to various legal actions arising in the ordinary course of business. The Company accrues costs associated with these matters when they become probable and the amount can be reasonably estimated. Legal costs incurred in connection with loss contingencies are expensed as incurred. The Company’s management does not expect any liability from the disposition of such claims and litigation individually or in the aggregate to have a material adverse impact on the Company’s consolidated financial position, results of operations and cash flows. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Jun. 30, 2023 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 19 — SUBSEQUENT EVENTS From July 2023 to October 2023, the Company repaid an aggregate of $10.6 million outstanding short-term bank loans to various financial institutions upon maturity (see Note 11). From July 2023 to October 2023, the Company borrowed additional $11.1 million loans from various PRC banks, including the following: (1) On July 20, 2023, the Company borrowed CNY2.2 million (approximately USD$0.3 million) short-term loan from CCB as working capital for six months, with loan maturity date on March 13, 2024 and effective interest rate of 3.85% per annum. (2) On August 4, 2023, the Company borrowed CNY1.0 million (approximately USD$0.1 million) short-term loan from WeBank as working capital for two months, with loan maturity date on October 3, 2024 and effective interest rate of 8.82% per annum. The loan was fully repaid upon the maturity of the loan. (3) On August 25, 2023, the Company borrowed CNY20.5million (approximately $2.8million ) short-term loan from ABC as working capital for six months, with loan maturity date on February 18, 2024 and effective interest rate of 3.8% per annum. (4) On August 10, 2023, the Company borrowed $1.3 million short-term loan from ICBC as working capital for three months, with loan maturity date on November 7, 2023 and effective interest rate of 5.90% per annum. The loan borrowed from ICBC Bank was guaranteed by the Company’s certain shareholders. (5) On August 29, 2023, the Company borrowed HKD7.9 million (approximately $1.0 million) short-term loan from Bank of China as working capital for twelve months, with loan maturity date on August 28, 2024 and effective interest rate of 3.73% per annum. The loan was pledged by a term deposit of JPY ¥146.6 million (approximately $1.0 million). (6) On September 7, 2023, the Company borrowed $1.1 million short-term loan from ICBC as working capital for three months, with loan maturity date on December 5, 2023 and effective interest rate of 5.99% per annum. The loan borrowed from ICBC Bank was guaranteed by the Company’s certain shareholders. (7) On October 7, 2023, the Company borrowed CNY2.0 million (approximately USD$0.3 million) short-term loans from WeBank as working capital for twenty-four months, with loan maturity date on October 17, 2025 and effective interest rate of 10.26% per annum. (8) On October 24, 2023, the Company borrowed CNY16.0 million (approximately $2.2 million short-term loan from SPD as working capital for six months, with loan maturity date on April 19, 2024 and effective interest rate of 2.74% per annum. (9) On October 27, 2023, the Company borrowed CNY14.0 million (approximately $1.9 million short-term loan from SPD as working capital for six months, with loan maturity date on April 24, 2024 and effective interest rate of 2.61% per annum. The loan borrowed from ICBC Bank was guaranteed by the Company’s certain shareholders. As a result of the above repayment and new borrowings, the Company had outstanding short-term bank loan balances of $14.5 million as of the date the Company’s consolidated financial statements are released. The Company evaluated the subsequent event through the date of the consolidated financial statements are available to release and through the date of this annual report, and concluded that there are no additional reportable subsequent events except those disclosed. |
Financial Information of the Pa
Financial Information of the Parent Company | 12 Months Ended |
Jun. 30, 2023 | |
Financial Information of the Parent Company [Abstract] | |
Financial Information of the Parent Company | NOTE 20 — FINANCIAL INFORMATION OF THE PARENT COMPANY Rule 12-04(a), 5-04(c) and 4-08(e)(3) of Regulation S-X require the financial information of the parent company to be filed when the restricted net assets of consolidated subsidiaries exceed 25 percent of consolidated net assets as of the end of the most recently completed fiscal year. The Company performed a test on the restricted net assets of consolidated subsidiaries in accordance with such requirement and concluded that it was applicable to the Company as the restricted net assets of the Company’s PRC subsidiaries and the VIE exceeded 25% of the consolidated net assets of the Company, therefore, the condensed financial statements for the parent company are included herein. For purposes of the above test, restricted net assets of consolidated subsidiaries and the VIE shall mean that amount of the Company’s proportionate share of net assets of consolidated subsidiaries (after intercompany eliminations) which as of the end of the most recent fiscal year may not be transferred to the parent company by subsidiaries and the VIE in the form of loans, advances or cash dividends without the consent of a third party. The interim financial information of the parent company has been prepared using the same accounting policies as set out in the Company’s consolidated financial statements except that the parent company used the equity method to account for investment in its subsidiaries and the VIE. Such investment is presented on the condensed balance sheets as “Investment in subsidiaries and the VIE” and the respective profit or loss as “Equity in earnings of subsidiaries and the VIE” on the condensed statements of comprehensive income. The footnote disclosures contain supplemental information relating to the operations of the Company and, as such, these statements should be read in conjunction with the notes to the consolidated interim financial statements of the Company. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S GAAP have been condensed or omitted. The Company did not pay any dividend for the periods presented. As of June 30, 2023 and 2022, there were no material contingencies, significant provisions for long-term obligations, or guarantees of the Company, except for those which have been separately disclosed in the consolidated financial statements, if any. June 30, June 30, ASSETS Non-current asset Investment in subsidiaries and the VIE $ 15,544,196 $ 10,494,915 Total assets $ 15,544,196 $ 10,494,915 LIABILITIES AND SHAREHOLDERS’ EQUITY LIABILITIES $ — $ — COMMITMENTS AND CONTINGENCIES SHAREHOLDERS’ EQUITY Ordinary shares, US$0.16 par value, 35,000,000 shares authorized, 10,326,374 and 8,826,374 shares issued and outstanding as of June 30, 2023 and 2022, respectively: * Class A shares, 30,000,000 shares authorized, 6,496,874 and 4,996,874 shares issued and outstanding 1,039,499 799,499 Class B shares, 5,000,000 shares authorized, 3,829,500 shares issued and outstanding 612,720 612,720 Additional paid-in capital 18,795,548 14,499,213 Accumulated deficit (4,710,203 ) (6,461,373 ) Accumulated other comprehensive income(loss) (193,368 ) 1,044,856 Total shareholders’ equity 15,544,196 10,494,915 Total liabilities and shareholders’ equity $ 15,544,196 $ 10,494,915 * Retrospectively restated for effect of 1-for-4 reverse split on November 2020 and 1-for-2 reverse split on August 8, 2022 of the ordinary shares, see Note 16. For the Year Ended June 30, 2023 2022 EQUITY IN EARNINGS OF SUBSIDIARIES AND VIE $ 1,751,170 $ 2,569,810 NET INCOME 1,751,170 2,569,810 FOREIGN CURRENCY TRANSLATION ADJUSTMENTS (1,238,224 ) 817,991 COMPREHENSIVE INCOME ATTRIBUTABLE TO THE COMPANY $ 512,946 $ 3,387,801 For the Year Ended June 30, 2023 2022 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 1,751,170 $ 2,569,810 Adjustments to reconcile net cash flows from operating activities: Equity in earnings of subsidiaries and VIE (1,751,170 ) (2,569,810 ) Net cash used in operating activities — — CHANGES IN CASH AND RESTRICTED CASH — — CASH AND RESTRICTED CASH, beginning of year — — CASH AND RESTRICTED CASH, end of year $ — $ — |
Accounting Policies, by Policy
Accounting Policies, by Policy (Policies) | 12 Months Ended |
Jun. 30, 2023 | |
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 (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The accompanying consolidated financial statements include the financial statements of the Company, its wholly owned subsidiaries, and entity which it consolidated the operation and financial results through VIE Agreements from the July 1, 2021 to the termination date of VIE Agreements. All inter-company balances and transactions are eliminated upon consolidation. |
Uses of estimates | Uses of estimates In preparing the consolidated financial statements in conformity U.S. GAAP, the 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 consolidated 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 advance to suppliers, inventory valuations, useful lives of property and equipment and intangible assets, the recoverability of long-lived assets, realization of deferred tax assets, and provision necessary for contingent liabilities. Actual results could differ from those estimates. |
Risks and uncertainties | Risks and uncertainties The main 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 economy in the PRC. 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, such experience may not be indicative of future results. The Company’s business, financial condition and results of operations may also be negatively impacted by risks related to natural disasters, extreme weather conditions, health epidemics and other catastrophic incidents, which could significantly disrupt the Company’s operations. The Company’s operations may be further affected by the ongoing outbreak of COVID-19 pandemic. A COVID-19 resurgence could negatively affect the execution of the Company’s sales contract and fulfilment of customer orders and the collection of the payments from customers on a timely manner. The Company will continue to monitor and modify the operating strategies in response to the COVID-19. The extent of the future impact of COVID-19 is still highly uncertain and cannot be predicted as of the date the Company’s financial statements are released. Concentration of credit risks Financial instruments that potentially subject the Company to significant concentration of credit risk consist primarily of cash and accounts receivable. As of June 30, 2023, the aggregate amounts of cash of $6,413,367 was deposited at major financial institutions located in the PRC and Hong Kong. In the event of bankruptcy of one of these financial institutions, the Company may not be able to claim its cash and demand deposits back in full. Management believes that these financial institutions are of high credit quality and continually monitors the credit worthiness of these financial institutions. Accounts receivable are typically unsecured and derived from revenue earned from customers in the PRC, which are exposed to credit risk. The risk is mitigated by credit evaluations. The Company maintains an allowance for doubtful accounts, and actual losses have generally been within management’s expectations. Refer to “Note 15. Concentrations” for detail. Interest rate risk The Company’s exposure to interest rate risk primarily relates to the interest income generated by excess cash, which is mostly held in interest-bearing bank deposits. The Company’s exposure to interest rate risk also arises from borrowings that have a floating rate of interest. The costs of floating rate borrowings may be affected by the fluctuations in the interest rates. The Company have not been, and do not expect to be, exposed to material interest rate risks, and therefore have not used any derivative financial instruments to manage such interest risk exposure. The Company has not been exposed to material risks due to changes in market interest rates, and not used any derivative financial instruments to manage the interest risk exposure during the year ended June 30, 2023. |
Cash | Cash Cash includes currency on hand and deposits held by banks that can be added or withdrawn without limitation. The Company maintains all of its bank accounts in the PRC. The Company’s cash balances in these bank accounts in the PRC are not insured by the Federal Deposit Insurance Corporation or other programs. |
Restricted cash | Restricted cash Restricted cash consists of cash deposited with the PRC banks and used as collateral to secure the Company’s short-term bank loans. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash |
Notes receivable | Notes receivable Notes receivable represent banks’ acceptances that have been arranged with third-party financial institutions by certain customers to settle their purchases from us. These notes receivable are non-interest bearing and are collectible within six to twelve months. As of June 30, 2023 and 2022, the Company had nil |
Accounts receivable, net | Accounts receivable, net Accounts receivable are presented net of allowance for doubtful accounts. The Company reduces accounts receivable by recording an allowance for doubtful accounts to account for the estimated impact of collection issues resulting from a client’s inability or unwillingness to pay valid obligations to the Company. The Company determines the adequacy of allowance for doubtful accounts based on individual account analysis, historical collection trend, and best estimate of specific losses on individual exposures. The Company establishes a provision for doubtful receivable when there is objective evidence that the Company may not be able to collect amounts due. Actual amounts received may differ from management’s estimate of credit worthiness and the economic environment. Delinquent account balances are written-off against the allowance for doubtful accounts after the management has determined that the likelihood of collection is not probable. Allowance for uncollectable balances amounted to nil |
Inventories, net | Inventories, net Inventories are comprised of purchased electronic components products to be sold to customers. Inventories are stated at the lower of cost or net realizable value, determined using primarily an average weighted cost method. The Company reviews its inventories periodically to determine if any reserves are necessary for potential shrinkage and obsolete or unusable inventory. Inventory allowance amounted to$1,851 and nil |
Advances to suppliers, net | Advances to suppliers, net Advances to suppliers consists of balances paid to suppliers for purchase of electronic components that have not been provided or received. Advances to suppliers are short-term in nature and are reviewed periodically to determine whether their carrying value has become impaired. The Company considers the assets to be impaired if the collectability of the advance becomes doubtful. The Company uses the aging method to estimate the allowance for uncollectible balances. In addition, at each reporting date, the Company generally determines the adequacy of allowance for doubtful accounts by evaluating all available information, and then records specific allowances for those advances based on the specific facts and circumstances. As of June 30, 2023 and 2022, there was no allowance recorded as the Company considers all of the advances to be fully realizable. |
Short-term investments | Short-term investments The Company’s short-term investments consist of wealth management financial products purchased from PRC banks with maturities ranging from one month to twelve months. The banks invest the Company’s fund in certain financial instruments including money market funds, bonds or mutual funds, with rates of return on these investments ranging from 1.5% to 2.5% per annum. The carrying values of the Company’s short-term investments approximate fair value because of their short-term maturities. The interest earned is recognized in the consolidated statements of income and comprehensive income over the contractual term of these investments (see Note 6). |
Leases | Leases On July 1, 2021, the Company adopted Accounting Standards Update (“ASU”) 2016-02, Leases (as amended by ASU 2018-01, 2018-10, 2018-11, 2018-20, and 2019-01, collectively “ASC 842”) using the modified retrospective basis and did not restate comparative periods as permitted under ASU 2018-11. ASC 842 requires that lessees recognize ROU assets and lease liabilities calculated based on the present value of lease payments for all lease agreements with terms that are greater than twelve months. ASC 842 distinguishes leases as either a finance lease or an operating lease that affects how the leases are measured and presented in the statement of operations and statement of cash flows. For operating leases, the Company calculated ROU assets and lease liabilities based on the present value of the remaining lease payments as of the date of adoption. The remaining balance of lease liabilities are presented within current portion of operating lease liabilities and the non-current portion of operating lease liabilities on the consolidated balance sheets (see Note 10). |
Property and equipment | Property and equipment Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation and amortization of property and equipment are provided using the straight-line method over their expected useful lives, as follows: Useful life Office equipment and furniture 3 years Automobiles 5 years Leasehold improvement Lesser of useful life and lease term 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 betterments 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 consolidated statements of income and comprehensive income. |
Intangible assets, net | Intangible assets, net The Company’s intangible assets primarily consist of internal-use software development costs associated with the Company’s e-commerce platform. Intangible assets are carried at cost less accumulated amortization and any recorded impairment. The Company amortizes its intangible assets over useful lives of 10 year using a straight-line method, which reflects the estimated pattern in which the economic benefits of the internally developed software are to be consumed. |
Impairment of long-lived Assets | Impairment of long-lived Assets Long-lived assets with finite lives, primarily property and equipment and intangible assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An asset is considered impaired if its carrying amount exceeds the future net undiscounted cash flows that the asset is expected to generate. If such asset is considered to be impaired, the impairment recognized is the amount by which the carrying amount of the asset, if any, exceeds its fair value determined using a discounted cash flow model. There were no impairments of these assets as of June 30, 2023 and 2022. |
Borrowings | Borrowings Borrowings comprise short-term borrowings. Borrowings are recognized initially at fair value, net of transaction costs incurred. Borrowings are subsequently stated at amortized cost; any difference between the proceeds net of transaction costs and the redemption value is recognized in profit or loss over the period of the borrowings using the effective interest method. |
Accounts payable | Accounts payable The Company’s accounts payable (“AP”) primarily include balance due to suppliers for purchase of electronic components products. |
Deferred initial public offering (“IPO”) costs | Deferred initial public offering (“IPO”) costs The Company complies with the requirement of the ASC 340-10-S99-1 and SEC Staff Accounting Bulletin (“SAB”) Topic 5A — “Expenses of Offering”. Deferred offering costs consist of underwriting, legal, consulting and other expenses incurred through the balance sheet date that are directly related to the intended IPO. Deferred offering costs will be charged to shareholders’ equity upon the completion of the IPO. Should the IPO prove to be unsuccessful, these deferred costs, as well as additional expenses to be incurred, will be charged to operations. Deferred IPO costs as included in “prepaid expenses and other current assets” amounted to nil |
Fair value of financial instruments | Fair value of financial instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A three-level fair value hierarchy prioritizes the inputs used to measure fair value. The hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows: ● Level 1 — inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. ● Level 2 — inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, quoted market prices for identical or similar assets in markets that are not active, inputs other than quoted prices that are observable and inputs derived from or corroborated by observable market data. ● Level 3 — inputs to the valuation methodology are unobservable. Unless otherwise disclosed, the fair value of the Company’s financial instruments, including cash, restricted cash, short-term investments, notes receivable, accounts receivable, advances to suppliers, inventories, prepaid expenses and other current assets, short-term bank loans, short-term borrowings — third-party loans, notes payable, accounts payable, deferred revenue, taxes payable, due to related parties, accrued expenses operating lease liabilities-current, and other current liabilities approximate the fair value of the respective assets and liabilities as of June 30, 2023 and2022 based upon the short-term nature of the assets and liabilities. |
Foreign currency translation | Foreign currency translation The functional currency for ICZOOM, ICZOOM HK, Ehub, Hjet HK and Components Zone HK is the U.S Dollar (“US$”). The Company primarily operates its business through its PRC subsidiaries as of June 30, 2022. The functional currency of the Company’s PRC subsidiaries and the VIE is the Chinese Yuan (“RMB”). The Company’s consolidated financial statements have been translated into US$. Assets and liabilities accounts are translated using the exchange rate at each reporting period end date. Equity accounts are translated at historical rates. Income and expense accounts are translated at the average rate of exchange during the reporting period. The resulting translation adjustments are reported under other comprehensive income. Gains and losses resulting from the translations of foreign currency transactions and balances are reflected in the results of operations. The RMB is not freely convertible into foreign currency and all foreign exchange transactions must take place through authorized institutions. No representation is made that the RMB amounts could have been, or could be, converted into US$ at the rates used in translation. The following table outlines the currency exchange rates that were used in creating the consolidated financial statements in this report: June 30, June 30, Period-end spot rate US$1=RMB 7.2254 US$1=RMB 6.7114 Average rate US$1=RMB 6.9881 US$1=RMB 6.4641 |
Revenue recognition | Revenue recognition ASC 606 establishes principles for reporting information about the nature, amount, timing and uncertainty of revenue and cash flows arising from the entity’s contracts to provide goods or services to customers. The core principle requires an entity to recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration that it expects to be entitled to receive in exchange for those goods or services recognized as performance obligations are satisfied. This new guidance provides a five-step analysis in determining when and how revenue is recognized. Under the new guidance, revenue is recognized when a customer obtains control of promised goods or services and is recognized in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. In addition, the new guidance requires disclosure of the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The Company currently generates its revenue from the following main sources: Revenue from sales of electronic components to customers The Company operates a B2B online platform www.iczoomex.com The Company accounts for revenue from sales of electronic components on a gross basis as the Company is responsible for fulfilling the promise to provide the desired electronic component products to customers, and is subject to inventory risk before the product ownership and risk are transferred and has the discretion in establishing prices. All of the Company’s contracts are fixed price contracts and have one single performance obligation as the promise is to transfer the individual goods to customers, and there is no separately identifiable other promises in the contracts. The Company’s revenue from sales of electronic components is recognized at a point in time when title and risk of loss passes and the customer accepts the goods, which generally occurs at delivery. Advance payment from customers is recorded as deferred revenue first and then recognized as revenue when products are delivered to the customers and the Company’s performance obligations are satisfied. The Company does not routinely allow customers to return products and historically return allowance was immaterial. There is no separate rebate, discount, or volume incentive involved. Revenue is reported net of all value added taxes (“VAT”). Service commission fees The Company’s service commission fees primarily consist of (1) fees charged to customers for assisting them for customs clearance when they directly purchase electronic component products from overseas suppliers; (2) fees charged to customers for providing temporary warehousing and organizing the product shipping and delivery to customer designated destinations after customs clearance. There is no separately identifiable other promises in the contracts. The Company merely acts as an agent in this type of transaction and earns a commission fee ranging from 0.15% to 1.5% based on the value of the merchandise that customers purchase from suppliers and such commission fee is not refundable. The Company does not have control of the goods in this type of transaction, has no discretion in establishing prices and does not have the ability to direct the use of the goods to obtain substantially all the benefits. Such revenue is recognized at the point when the Company’s customs clearance, warehousing, logistic and delivery services are performed and the customer receive the products. Revenues are recorded net of sales taxes and value added taxes. Contract Assets and Liabilities The Company did not have contract assets as of June 30, 2023 and 2022. Contract liabilities are recognized for contracts where payment has been received in advance of delivery. The Company’s contract liabilities, which are reflected in its consolidated balance sheets as deferred revenue of $1,671,353 and $3,651,700 as of June 30, 2023 and 2022, respectively. Costs of fulfilling customers’ purchase orders, such as shipping, handling and delivery, which occur prior to the transfer of control, are recognized in selling expense when incurred. Disaggregation of revenue The Company disaggregates its revenue from contracts by product and service types, as the Company believes it best depicts how the nature, amount, timing and uncertainty of the revenue and cash flows are affected by economic factors. The summary of the Company’s total revenues by product and service type for the year ended June 30, 2023 and 2022 was as follows: For the years ended 2023 2022 Sales of electronic components products: Semiconductor: Integrated Circuits $ 36,208,767 $ 155,134,814 Power/Circuit Protection 13,902,350 15,971,800 Discrete 16,047,821 23,071,808 Passive Components 99,326,417 25,110,572 Optoelectronics/Electromechanical 8,535,997 12,056,185 Other semiconductor products 15,366,941 29,103,445 Equipment, tools and others: Equipment 10,102,545 8,745,020 Tools and others 11,632,317 17,346,092 Total sales of electronic components products 211,123,155 286,539,736 Service commission fees 3,282,071 3,836,635 Total revenue $ 214,405,226 $ 290,376,371 |
Segment reporting | Segment reporting An operating segment is a component of the Company that engages in business activities from which it may earn revenues and incur expenses, and is identified on the basis of the internal financial reports that are provided to and regularly reviewed by the Company’s chief operating decision maker in order to allocate resources and assess performance of the segment. The Company purchases electronic component products from third-party suppliers and then sells to customers. The Company’s products have similar economic characteristics with respect to vendors, marketing and promotions, customers and methods of distribution. The Company’s chief operating decision maker has been identified as the Chief Executive Officer, who reviews consolidated results when making decisions about allocating resources and assessing performance of the Company, and concludes that the Company has only one reporting segment. |
Shipping and handling costs | Shipping and handling costs Shipping and handling costs are expensed as incurred. Inbound shipping and handling cost associated with bringing the purchased electronic component products from suppliers to the Company’s warehouse are included in cost of revenue. Outbound shipping and handling costs associated with shipping and delivery the products to customers are included in selling expenses. For the years ended June 30, 2023 and 2022, shipping and handling costs included in cost of revenue amounted to $474,543 and $589,291 and shipping and handling costs included in selling expenses amounted to $423,606 and $445,840, respectively. |
Research and development | Research and development The Company’s research and development activities primarily relate to development and implementation of its e-commerce platform and software. Research and development costs are expensed as incurred unless such costs qualify for capitalization as software development costs. In order to qualify for capitalization, (i) the preliminary project should be completed, (ii) management has committed to funding the project and it is probable that the project will be completed and the software will be used to perform the function intended, and (iii) it will result in significant additional functionality in the Company’s e-commerce platform. Capitalized software development costs amounted to $63,698 and $16,351 for the years ended June 30, 2023 and 2022, respectively. Research and development expenses included in general and administrative expenses amounted to $437,261 and $530,144 for the years ended June 30, 2023 and 2022, respectively, primarily comprising employee costs, and amortization and depreciation to intangible assets and property and equipment used in the research and development activities. |
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. An uncertain tax position is recognized only if it is “more likely than not” that the tax position would be sustained in a tax examination. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded. Penalties and interest incurred related to underpayment of income tax are classified as income tax expense in the period incurred. No significant penalties or interest relating to income taxes have been incurred for the year ended June 30, 2023 and 2022. The Company does not believe that there was any uncertain tax provision at June 30, 2023 and 2022. The Company’s subsidiaries in Hong Kong are subject to the profit taxes in Hong Kong. The Company’s subsidiaries in China are subject to the income tax laws of the PRC. For the year ended June 30, 2023 and 2022, the Company generated income before taxes of $877,850 and $1,109,748 through its Hong Kong subsidiaries. As of June 30, 2023, all of the tax returns of the Company’s subsidiaries remain available for statutory examination by Hong Kong and PRC tax authorities. |
Value added tax (“VAT”) | Value added tax (“VAT”) The Company is a general taxpayer and is subject to applicable VAT tax rate of 6% or 16%, and starting from April 1, 2019, the Company is subject to applicable VAT tax rate of 6% or 13%. VAT is reported as a deduction to revenue when incurred. Entities that are VAT general taxpayers are allowed to offset qualified input VAT tax paid to suppliers against their output VAT liabilities. |
Debt issuance costs | Debt issuance costs Debt issuance costs related to a recognized debt liability are presented in the consolidated balance sheet as a direct deduction from the carrying amount of the debt liability, consistent with debt discounts. Amortization of debt origination costs is calculated using the effective interest method and is included as a component of interest expense. |
Earnings per Share | Earnings per Share The Company computes earnings per share (“EPS”) in accordance with ASC 260, “Earnings per Share” (“ASC 260”). 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 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. The following table sets forth the computation of basic and diluted earnings per share for the year ended June 30, 2023 and 2022: For the years ended 2023 2022 Numerator: Net income attributable to ordinary shareholders $ 1,751,170 $ 2,569,810 Denominator: Weighted-average number of ordinary shares outstanding – basic 9,201,374 8,826,374 Outstanding options 742,762 751,012 Potentially dilutive shares from outstanding options 717,557 720,972 Weighted-average number of ordinary shares outstanding – diluted 9,918,931 9,547,346 Earnings per share – basic $ 0.19 $ 0.29 Earnings per share – diluted $ 0.18 $ 0.27 |
Employee benefit plan | Employee benefit plan The Company’s subsidiaries in the PRC participate in a government-mandated multi-employer defined contribution plan pursuant to which pension, work-related injury benefits, maternity insurance, medical insurance, unemployment benefit and housing fund are provided to eligible full-time employees. The relevant labor regulations require the Company’s subsidiaries in the PRC to pay the local labor and social welfare authorities monthly contributions based on the applicable benchmarks and rates stipulated by the local government. The contributions to the plan are expensed as incurred. Employee social security and welfare benefits included as expenses in the accompanying consolidated statements of income and comprehensive income amounted to $175,762 and $199,472 for the year ended June 30, 2023 and 2022, respectively. |
Comprehensive income | Comprehensive income Comprehensive income consists of two components, net income and other comprehensive income. The foreign currency translation gain or loss resulting from translation of the consolidated financial statements expressed in RMB to US$ is reported in other comprehensive income in the consolidated statements of comprehensive income. |
Statement of cash flows | Statement of cash flows In accordance with ASC 230, “Statement of Cash Flows”, cash flows from the Company’s operations are formulated based upon the local currencies using the average exchange rate in the period. As a result, 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. |
Government subsidies | Government subsidies Government subsidies are provided by the relevant PRC municipal government authorities to subsidize the cost of certain research and development projects. The Company recognizes government subsidies as other operating income when they are received because they are not subject to any past or future conditions, there are no performance conditions or conditions of use, and they are not subject to future refunds. Government subsidies received and recognized as other operating income totaled $125,125 and $213,741 for the years ended June 30, 2023 and 2022, respectively. |
Share-based compensation | Share-based compensation The Company grants stock options to eligible employees for services and accounts for share-based compensation in accordance with ASC 718, Compensation — Stock Compensation. Share-based compensation awards are measured at the grant date fair value of the awards and recognized as expenses using the straight-line method over the vesting period. The fair value of share options was determined using the binomial option valuation model, which requires the input of highly subjective assumptions, including the expected volatility, the exercise multiple, the risk-free rate and the dividend yield. For expected volatility, the Company has made reference to historical volatility of several comparable companies in the same industry. The exercise multiple was estimated as the average ratio of the stock price to the exercise price of when employees would decide to voluntarily exercise their vested share options. The risk-free rate for periods within the contractual life of the share options is based on the market yield of U.S. Treasury Bonds in effect at the time of grant. The dividend yield is based on the expected dividend policy over the contractual life of the share options. |
Related parties and transactions | Related parties and transactions The Company identifies related parties, and accounts for, discloses related party transactions in accordance with ASC 850, “Related Party Disclosures” and other relevant ASC standards. Parties, which can be a corporation or individual, are considered to be related if the Company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operational decisions. Companies are also considered to be related if they are subject to common control or common significant influence. Transactions between related parties commonly occurring in the normal course of business are considered to be related party transactions. Transactions between related parties are also considered to be related party transactions even though they may not be given accounting recognition. While ASC does not provide accounting or measurement guidance for such transactions, it nonetheless requires their disclosure. |
Recent accounting pronouncements | Recent accounting pronouncements The Company considers the applicability and impact of all ASUs. Management periodically reviews new accounting standards that are issued. |
Recently issued accounting pronouncements not yet adopted | Recently issued accounting pronouncements not yet adopted In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326), which requires entities to measure all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. This replaces the existing incurred loss model and is applicable to the measurement of credit losses on financial assets measured at amortized cost. ASU 2016-13 was subsequently amended by Accounting Standards Update 2018-19, Codification Improvements to Topic 326, Financial Instruments — Credit Losses Codification Improvements to Topic 326, Financial Instruments — Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments Targeted Transition Relief. In October 2021, the FASB issued ASU No. 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (ASU 2021-08), which clarifies that an acquirer of a business should recognize and measure contract assets and contract liabilities in a business combination in accordance with Topic 606, Revenue from Contracts with Customers. The new amendments are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The amendments should be applied prospectively to business combinations occurring on or after the effective date of the amendments, with early adoption permitted. The Company is currently evaluating the impact of the new guidance on our consolidated financial statements. In March 2022, the FASB issued ASU No. 2022-02, Financial Instruments—Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures, which eliminates the troubled debt restructurings (TDRs) accounting model for creditors that have already adopted Topic 326, which is commonly referred to as the current expected credit loss (CECL) model. For entities that have adopted Topic 326, the amendments in this Update are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The FASB’s decision to eliminate the TDR accounting model is in response to feedback that the allowance under CECL already incorporates credit losses from loans modified as TDRs and, consequently, the related accounting and disclosures – which preparers often find onerous to apply – no longer provide the same level of benefit to users. The Company is currently evaluating the impact of the new guidance on our consolidated financial statements. In June 2022, the FASB issued ASU No. 2022-03, Fair Value Measurement (Topic 820) – Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions, which stipulates that a contractual restriction on the sale of an equity security should not be considered part of the equity security’s unit of account and, therefore, should not be considered in measuring its fair value. For public business entities, the amendments in this Update are effective for fiscal years beginning after December 15, 2023, and interim periods within those fiscal years. The Company is currently evaluating the impact of the new guidance on our consolidated financial statements. |
Organization and Business Des_2
Organization and Business Description (Tables) | 12 Months Ended |
Jun. 30, 2023 | |
Organization and Business Description (Tables) [Line Items] | |
Schedule of Consolidated Financial Statements of the Company | The consolidated financial statements of the Company include the following entities: Name of Entity Date of Place of % of Principal ICZOOM June 18, 2015 Cayman Islands Parent, 100% Investment holding ICZOOM HK May 22, 2012 Hong Kong 100% Purchase of electronic components from overseas suppliers Ehub September 13, 2012 Hong Kong 100% Purchase of electronic components from overseas suppliers Hjet HK August 6, 2013 Hong Kong 100% Purchase of electronic components from overseas suppliers Components Zone HK May 19, 2020 Hong Kong 100% Investment holding ICZOOM WFOE September 17, 2020 PRC 100% WFOE, Consultancy Hjet Shuntong November 8, 2013 PRC 100% Investment holding Hjet Supply Chain July 3, 2006 PRC 100% Order fulfilment ICZOOM Shenzhen July 20, 2015 PRC 100% Sales of electronic components through B2B e-commerce platform Hjet Logistics May 31, 2013 PRC 100% Logistics and product shipping Heng Nuo Chen May 25, 2015 PRC 100% Logistics and product shipping. Deregistered in August 2021 Pai Ming Shenzhen May 9, 2012 PRC 0%, Former VIE Holds an EDI license and an ICP License. The VIE agreements has been terminated in December 2021 |
Schedule of Unaudited Balance Sheet | June 30, June 30, ASSETS Non-current asset Investment in subsidiaries and the VIE $ 15,544,196 $ 10,494,915 Total assets $ 15,544,196 $ 10,494,915 LIABILITIES AND SHAREHOLDERS’ EQUITY LIABILITIES $ — $ — COMMITMENTS AND CONTINGENCIES SHAREHOLDERS’ EQUITY Ordinary shares, US$0.16 par value, 35,000,000 shares authorized, 10,326,374 and 8,826,374 shares issued and outstanding as of June 30, 2023 and 2022, respectively: * Class A shares, 30,000,000 shares authorized, 6,496,874 and 4,996,874 shares issued and outstanding 1,039,499 799,499 Class B shares, 5,000,000 shares authorized, 3,829,500 shares issued and outstanding 612,720 612,720 Additional paid-in capital 18,795,548 14,499,213 Accumulated deficit (4,710,203 ) (6,461,373 ) Accumulated other comprehensive income(loss) (193,368 ) 1,044,856 Total shareholders’ equity 15,544,196 10,494,915 Total liabilities and shareholders’ equity $ 15,544,196 $ 10,494,915 * Retrospectively restated for effect of 1-for-4 reverse split on November 2020 and 1-for-2 reverse split on August 8, 2022 of the ordinary shares, see Note 16. |
Condensed Cash Flow Statement [Table Text Block] | For the Year Ended June 30, 2023 2022 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 1,751,170 $ 2,569,810 Adjustments to reconcile net cash flows from operating activities: Equity in earnings of subsidiaries and VIE (1,751,170 ) (2,569,810 ) Net cash used in operating activities — — CHANGES IN CASH AND RESTRICTED CASH — — CASH AND RESTRICTED CASH, beginning of year — — CASH AND RESTRICTED CASH, end of year $ — $ — |
Pai Ming Shenzhen [Member] | |
Organization and Business Description (Tables) [Line Items] | |
Schedule of Unaudited Balance Sheet | December 10, June 30, ASSETS CURRENT ASSETS Cash $ 41,912 $ 2,891 Accounts receivable 173,550 — Prepaid expenses and other current assets 2,024 7,061 TOTAL CURRENT ASSETS 217,486 9,952 Other noncurrent assets 2,411 1,452 TOTAL ASSETS $ 219,897 $ 11,404 LIABILITIES CURRENT LIABILITIES Accrued expenses and other current liabilities $ 427,395 $ 566,158 TOTAL CURRENT LIABILITIES 427,395 566,158 TOTAL LIABILITIES $ 427,395 $ 566,158 |
Condensed Income Statement [Table Text Block] | From July 1, For the (Unaudited) REVENUE, net $ 72,425 $ 36,273 COST OF REVENUE 1,122 32,229 GROSS PROFIT 71,303 4,044 OPERATING EXPENSES Selling expenses 14,265 37,809 General and administrative expenses 75,751 182,628 Total operating expenses 90,016 220,437 LOSS FROM OPERATIONS (18,713 ) (216,393 ) OTHER INCOME Other income, net 92 243 Total other income, net 92 243 LOSS BEFORE INCOME TAX PROVISION (18,621 ) (216,150 ) PROVISION FOR INCOME TAXES — — NET LOSS $ (18,621 ) $ (216,150 ) |
Condensed Cash Flow Statement [Table Text Block] | From July 1, For the Cash flows from operating activities: Net loss $ (18,621 ) $ (216,150 ) Changes in operating assets and liabilities: Accounts receivable — — Advances to suppliers — — Prepaid expenses and other current assets 4,095 (2,847 ) Other noncurrent assets — (1,421 ) Accrued expenses and other current liabilities 53,198 216,478 Net cash provided by (used in) operating activities 38,672 (3,940 ) Effect of exchange rate fluctuation on cash 349 515 Net increase (decrease) in cash 39,021 (3,425 ) Cash at beginning of the period 2,891 6,316 Cash at end of the period $ 41,912 $ 2,891 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
Schedule of Depreciation and Amortization of Property and Equipment | Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation and amortization of property and equipment are provided using the straight-line method over their expected useful lives, as follows: Useful life Office equipment and furniture 3 years Automobiles 5 years Leasehold improvement Lesser of useful life and lease term |
Schedule of Currency Exchange Rates | The following table outlines the currency exchange rates that were used in creating the consolidated financial statements in this report: June 30, June 30, Period-end spot rate US$1=RMB 7.2254 US$1=RMB 6.7114 Average rate US$1=RMB 6.9881 US$1=RMB 6.4641 |
Schedule of Total Revenues by Product and Service Type | The summary of the Company’s total revenues by product and service type for the year ended June 30, 2023 and 2022 was as follows: For the years ended 2023 2022 Sales of electronic components products: Semiconductor: Integrated Circuits $ 36,208,767 $ 155,134,814 Power/Circuit Protection 13,902,350 15,971,800 Discrete 16,047,821 23,071,808 Passive Components 99,326,417 25,110,572 Optoelectronics/Electromechanical 8,535,997 12,056,185 Other semiconductor products 15,366,941 29,103,445 Equipment, tools and others: Equipment 10,102,545 8,745,020 Tools and others 11,632,317 17,346,092 Total sales of electronic components products 211,123,155 286,539,736 Service commission fees 3,282,071 3,836,635 Total revenue $ 214,405,226 $ 290,376,371 |
Schedule of Computation of Basic and Diluted Earnings Per Share | The following table sets forth the computation of basic and diluted earnings per share for the year ended June 30, 2023 and 2022: For the years ended 2023 2022 Numerator: Net income attributable to ordinary shareholders $ 1,751,170 $ 2,569,810 Denominator: Weighted-average number of ordinary shares outstanding – basic 9,201,374 8,826,374 Outstanding options 742,762 751,012 Potentially dilutive shares from outstanding options 717,557 720,972 Weighted-average number of ordinary shares outstanding – diluted 9,918,931 9,547,346 Earnings per share – basic $ 0.19 $ 0.29 Earnings per share – diluted $ 0.18 $ 0.27 |
Accounts Receivable, Net (Table
Accounts Receivable, Net (Tables) | 12 Months Ended |
Jun. 30, 2023 | |
Accounts Receivable, Net [Abstract] | |
Schedule of Accounts Receivable | Accounts receivable consists of the following: June 30, June 30, Accounts receivable $ 76,690,246 $ 76,119,299 Less: allowance for doubtful accounts - (99,003 ) Accounts receivable, net $ 76,690,246 $ 76,020,296 |
Schedule of Outstanding Accounts Receivable and Subsequent Collection | The following table summarizes the Company’s outstanding accounts receivable and subsequent collection by aging bucket: Balance as of Subsequent % of AR aged less than 6 months $ 76,401,424 48,068,811 62.9 % AR aged from 7 to 12 months 288,822 288,822 100.0 % Accounts Receivable $ 76,690,246 48,357,633 63.1 % Balance as of Subsequent % of AR aged less than 6 months $ 74,233,261 $ 74,233,261 100.0 % AR aged from 7 to 12 months 1,886,038 1,886,038 100.0 % Accounts Receivable $ 76,119,299 $ 76,119,299 100.0 % |
Schedule of Allowance for Doubtful Accounts Movement | Allowance for doubtful accounts movement is as follows: June 30, June 30, Beginning balance $ 99,003 $ 133,059 Reversal (99,003 ) (30,187 ) Foreign currency translation adjustments - (3,869 ) Ending balance $ - $ 99,003 |
Inventories, Net (Tables)
Inventories, Net (Tables) | 12 Months Ended |
Jun. 30, 2023 | |
Inventories, Net [Abstract] | |
Schedule of Inventories Net | Inventories, net, consist of the following: June 30, June 30, Semiconductors $ 764,592 $ 324,410 Equipment, tools and others 71,117 41,205 Inventory valuation allowance (1,851 ) — Total inventory, net $ 833,858 $ 365,615 |
Advances To Suppliers (Tables)
Advances To Suppliers (Tables) | 12 Months Ended |
Jun. 30, 2023 | |
Advances To Suppliers [Abstract] | |
Schedule of Advances to Suppliers Net | Advances to suppliers, net, consist of the following: June 30, June 30, Advances to suppliers $ 1,608,941 $ 6,613,280 |
Short-Term Invstment (Tables)
Short-Term Invstment (Tables) | 12 Months Ended |
Jun. 30, 2023 | |
Short-Term Invstment [Abstract] | |
Schedule of Short-Term Investment | Short-term investment consisted of the following: June 30, June 30, Beginning balance $ 1,490 $ 928,800 Add: purchase additional wealth management financial products 4,125,704 20,025,600 Less: proceeds received upon maturity of short-term investment (4,127,088 ) (20,918,110 ) Foreign currency translation adjustments (106 ) (34,800 ) Ending balance of short-term investment $ - $ 1,490 |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets (Tables) | 12 Months Ended |
Jun. 30, 2023 | |
Prepaid Expenses And Other Current Assets [Abstract] | |
Schedule of Prepaid expenses and other current assets | Prepaid expenses and other current assets consist of the following: June 30, June 30, Other receivables, net (1) $ 1,286,920 $ 1,706,767 Deferred initial public offering costs (2) - 629,748 Prepaid expenses (3) 54,281 96,398 Prepaid expenses and other current assets $ 1,341,201 $ 2,432,913 (1) Other receivable primarily includes prepaid VAT input tax in connection with the Company’s purchase of electronic component products from third-party suppliers when VAT invoices have not been received as of the balance sheet date. Other receivable also includes, advances to employees for business development and security deposits for operating leases. As of June 30, 2023, the balance of other receivable mainly consists of $892,703 of prepaid VAT input tax, $21,910 of advances to employees and $317,459 of security deposits for operating leases. All the June 30, 2022 other receivable balance and approximately 74.9% of the June 30, 2023 other receivable balance has been collected or settled. (2) Deferred initial public offering costs of nil (3) Prepaid expenses include mainly prepayment for rental expense and equipment maintenance, etc. |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 12 Months Ended |
Jun. 30, 2023 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment, Net | Property and equipment, net, consists of the following: June 30, June 30, Office equipment and furniture $ 151,007 $ 140,695 Automobiles 69,782 62,580 Leasehold improvement 403,778 369,065 Subtotal 624,567 572,340 Less: accumulated depreciation (498,535 ) (453,096 ) Property and equipment, net $ 126,032 $ 119,244 |
Intangible Assets, Net (Tables)
Intangible Assets, Net (Tables) | 12 Months Ended |
Jun. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets, Net | Intangible assets, net, mainly consist of the following: June 30, June 30, Capitalized internal-use software development costs $ 905,431 $ 905,375 Less: accumulated amortization (616,995 ) (527,037 ) Intangible assets, net $ 288,436 $ 378,338 |
Schedule of Estimated Future Amortization Expense for Intangible Assets | Amortization expense was $131,762 and $118,184 for the years ended June 30, 2023 and 2022, respectively. Estimated future amortization expense for intangible assets is as follows: Twelve months ending June 30, Amortization 2024 $ 88,821 2025 78,094 2026 76,316 2027 30,840 2028 11,241 Thereafter 3,124 $ 288,436 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Jun. 30, 2023 | |
Leases [Abstract] | |
Schedule of Operating Lease Related Assets and Liabilities on the Balance Sheets | The table below presents the operating lease related assets and liabilities recorded on the balance sheets. June 30, June 30, Operating lease right-of-use assets $ 1,274,479 732,993 Operating lease right-of-use assets – accumulated amortization (411,627 ) (40,422 ) Operating lease right-of-use assets – net $ 862,852 692,571 Operating lease liabilities, current 524,698 232,221 Operating lease liabilities, non-current 375,056 480,436 Total operating lease liabilities, $ 899,754 712,657 |
Schedule of Maturities of Operating Lease Liabilities | As of June 30, 2023, maturities of operating lease liabilities were as follows: Twelve months ending June 30, June 30, 2024 549,919 2025 376,604 Total future minimum lease payments 926,523 Less: Imputed interest (26,769 ) Total $ 899,754 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Jun. 30, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Short-Term Loans | The Company borrowed from PRC banks, other financial institutions and third parties as working capital funds. As of June 30, 2023 and 2022, the Company’s debt consisted of the following: June 30, June 30, Shanghai Pudong Development Bank (1) $ 4,152,000 $ 5,000,000 Agricultural Bank of China (2) 2,750,000 3,200,000 Industrial and Commercial Bank of China (3) 2,400,000 2,600,000 Bank Of China (4) 4,732,116 1,008,400 Less: Debt issuance cost (5) (11,593 ) (48,013 ) Total short-term loans, net $ 14,022,523 $ 11,760,387 |
Accounts Payable (Tables)
Accounts Payable (Tables) | 12 Months Ended |
Jun. 30, 2023 | |
Accounts Payable [Abstract] | |
Schedule of Outstanding Accounts Payable and Subsequent Settlement by Aging Bucket | The following table summarizes the Company’s outstanding accounts payable and subsequent settlement by aging bucket: Balance as of Subsequent % of Accounts payable aged less than 6 months $ 50,049,201 $ 35,071,648 70.1 % Accounts payable aged from 7 to 12 months 1,078,127 1,078,127 100.0 % Total accounts payable $ 51,127,328 $ 36,149,775 70.7 % Balance as of Subsequent % of Accounts payable aged less than 6 months $ 59,541,103 $ 59,541,103 100.0 % Accounts payable aged from 7 to 12 months 17,640 17,640 100.0 % Total accounts payable $ 59,558,743 $ 59,558,743 100.0 % |
Taxes (Tables)
Taxes (Tables) | 12 Months Ended |
Jun. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Provision | The components of the income tax provision from Cayman Islands, Hong Kong, and China are as follows: For the Years Ended June 30, 2023 2022 Current tax provision Cayman Islands $ — $ — Hong Kong 84,828 183,197 China 157,376 398,085 242,204 581,282 Deferred tax provision (benefit) Cayman Islands — — Hong Kong (305 ) — China 23,771 5,994 23,465 5,994 Income tax provision $ 265,670 $ 587,276 |
Schedule of Reconciliation of Differences Between Income Tax Provision Computed Based on PRC Statutory Income Tax Rate and Actual Income Tax Provision | Reconciliation of the differences between the income tax provision computed based on PRC statutory income tax rate and the Company’s actual income tax provision for the years ended June 30, 2023 and 2022, respectively are as follows: For the Years Ended 2023 2022 Income tax expense computed based on PRC statutory rate $ 504,210 $ 709,419 Effect of rate differential for Hong Kong entities (110,932 ) (146,790 ) Non-deductible expenses: Stock-based compensation* 14,649 13,543 Meals and entertainment 3,375 4,067 Change in valuation allowance (145,632 ) 7,037 Actual income tax provision $ 265,670 $ 587,276 * The Company’s stock-based compensation expenses were recorded under the Cayman parent company level. Pursuant to the current tax laws of the Cayman Islands, the Company is not subject to tax on its income or capital gains. As a result, stock-based compensation expenses are non-deductible expenses for income tax purposes. |
Schedule of Deferred Tax Assets | The Company’s deferred tax assets are comprised of the following: June 30, June 30, Deferred tax assets derived from net operating loss (“NOL”) carry forwards $ 406,760 $ 576,432 Allowance for doubtful accounts - 24,751 Allowance of Inventory 305 Less: valuation allowance (406,760 ) (576,432 ) Deferred tax assets $ 305 $ 24,751 |
Schedule of Valuation Allowance | Movement of valuation allowance: June 30, June 30, Balance at beginning of the period $ 576,432 $ 726,607 Current period addition/(reversal) (169,672 ) 8,446 Effect due to the termination of VIE - (158,621 ) Balance at end of the period $ 406,760 $ 576,432 |
Schedule of Taxes payable | Taxes payable consist of the following: June 30, June 30, Income tax payable $ 2,363,980 $ 2,445,687 Value added tax payable 568,157 229,315 Total taxes payable $ 2,932,137 $ 2,675,002 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 12 Months Ended |
Jun. 30, 2023 | |
Related Party Transactions [Abstract] | |
Schedule of Due to related parties consists | Due to related parties consists of the following: Name Related party relationship June 30, June 30, Mrs. Duanrong Liu Shareholder, Director and Chief Operating Officer $ 1,451,842 $ 282,336 Mr. Lei Xia Shareholder, Chairman and Chief Executive Officer 21,943 28,884 Other shareholders Shareholders of the Company 34,981 38,464 Total due to related parties $ 1,508,766 $ 349,684 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 12 Months Ended |
Jun. 30, 2023 | |
Share-Based Compensation [Abstract] | |
Share-Based Payment Arrangement, Option, Activity [Table Text Block] | The following table summarizes the Company’s stock option activities: Number of Weighted Weighted Fair Value Outstanding, June 30, 2021 960,174 $ 0.18 2.80 $ 2,551,737 Exercisable, June 30, 2021 949,093 $ 0.16 2.76 $ 2,470,526 Granted — — — — Forfeited (209,162 ) 0.16 — (1,672,892 ) Exercised — — — — Outstanding, June 30, 2022 751,012 0.16 1.05 $ 878,845 Exercisable, June 30, 2022 749,440 0.17 1.04 $ 869,478 Granted — — — — Forfeited (8,250 ) 0.16 — (49,159 ) Exercised — — — — Outstanding, June 30, 2023 742,762 0.18 0.05 $ 829,686 Exercisable, June 30, 2023 742,762 0.18 0.05 $ 829,686 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Jun. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Operating lease Future Minimum Lease Payments | As of June 30, 2023, future minimum lease payments under non-cancelable operating lease agreement are as follows: Twelve Months ended June 30, Lease 2024 $ 144,803 2025 93,757 Total 238,560 |
Financial Information of the _2
Financial Information of the Parent Company (Tables) | 12 Months Ended |
Jun. 30, 2023 | |
Financial Information of the Parent Company [Abstract] | |
Schedule of Parent Company Balance Sheets | June 30, June 30, ASSETS Non-current asset Investment in subsidiaries and the VIE $ 15,544,196 $ 10,494,915 Total assets $ 15,544,196 $ 10,494,915 LIABILITIES AND SHAREHOLDERS’ EQUITY LIABILITIES $ — $ — COMMITMENTS AND CONTINGENCIES SHAREHOLDERS’ EQUITY Ordinary shares, US$0.16 par value, 35,000,000 shares authorized, 10,326,374 and 8,826,374 shares issued and outstanding as of June 30, 2023 and 2022, respectively: * Class A shares, 30,000,000 shares authorized, 6,496,874 and 4,996,874 shares issued and outstanding 1,039,499 799,499 Class B shares, 5,000,000 shares authorized, 3,829,500 shares issued and outstanding 612,720 612,720 Additional paid-in capital 18,795,548 14,499,213 Accumulated deficit (4,710,203 ) (6,461,373 ) Accumulated other comprehensive income(loss) (193,368 ) 1,044,856 Total shareholders’ equity 15,544,196 10,494,915 Total liabilities and shareholders’ equity $ 15,544,196 $ 10,494,915 * Retrospectively restated for effect of 1-for-4 reverse split on November 2020 and 1-for-2 reverse split on August 8, 2022 of the ordinary shares, see Note 16. |
Schedule of Parent Company Statements of Comprehensive Income | For the Year Ended June 30, 2023 2022 EQUITY IN EARNINGS OF SUBSIDIARIES AND VIE $ 1,751,170 $ 2,569,810 NET INCOME 1,751,170 2,569,810 FOREIGN CURRENCY TRANSLATION ADJUSTMENTS (1,238,224 ) 817,991 COMPREHENSIVE INCOME ATTRIBUTABLE TO THE COMPANY $ 512,946 $ 3,387,801 |
Schedule of Parent Company Statements of Cash Flows | For the Year Ended June 30, 2023 2022 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 1,751,170 $ 2,569,810 Adjustments to reconcile net cash flows from operating activities: Equity in earnings of subsidiaries and VIE (1,751,170 ) (2,569,810 ) Net cash used in operating activities — — CHANGES IN CASH AND RESTRICTED CASH — — CASH AND RESTRICTED CASH, beginning of year — — CASH AND RESTRICTED CASH, end of year $ — $ — |
Organization and Business Des_3
Organization and Business Description (Details) | 5 Months Ended | 12 Months Ended | ||||
Dec. 10, 2021 USD ($) | Jun. 30, 2023 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2023 CNY (¥) | Jun. 30, 2021 USD ($) | Dec. 14, 2020 | |
Organization and Business Description (Details) [Line Items] | ||||||
Total assets (in Dollars) | $ 88,175,838 | $ 89,633,012 | ||||
Total liabilities (in Dollars) | 72,631,642 | 79,138,097 | ||||
Accumulated deficit (in Dollars) | (5,334,300) | (7,085,470) | ||||
Operating revenue (in Dollars) | $ 214,405,226 | $ 290,376,371 | ||||
Percentage of Total Revenue | 0.03% | |||||
ICZOOM Group Inc [Member] | ||||||
Organization and Business Description (Details) [Line Items] | ||||||
Percentage of equity interest | 100% | 100% | 100% | |||
Heng Nuo Chen [Member] | Other Assets [Member] | ||||||
Organization and Business Description (Details) [Line Items] | ||||||
Total assets (in Dollars) | $ 5,879 | |||||
Percentage of assets | 0.01% | |||||
Percentage of liabilities | 0.41% | |||||
Heng Nuo Chen [Member] | Other Liabilities [Member] | ||||||
Organization and Business Description (Details) [Line Items] | ||||||
Total liabilities (in Dollars) | $ 325,497 | |||||
Accumulated deficit (in Dollars) | $ 305,780 | |||||
Percentage of accumulated deficit | 3.27% | |||||
Pai Ming Shenzhen [Member] | ||||||
Organization and Business Description (Details) [Line Items] | ||||||
Monthly fixed fee (in Yuan Renminbi) | ¥ | ¥ 100,000 | |||||
Operating revenue (in Dollars) | $ 72,425 | |||||
Loss of termination of the VIE Agreements (in Dollars) | $ 205,249 | |||||
Pai Ming Shenzhen [Member] | Other Assets [Member] | ||||||
Organization and Business Description (Details) [Line Items] | ||||||
Total assets (in Dollars) | $ 219,897 | |||||
Percentage of assets | 0.60% | |||||
Pai Ming Shenzhen [Member] | Other Liabilities [Member] | ||||||
Organization and Business Description (Details) [Line Items] | ||||||
Total liabilities (in Dollars) | $ 427,395 | |||||
Percentage of liabilities | 0.89% |
Organization and Business Des_4
Organization and Business Description (Details) - Schedule of Consolidated Financial Statements of the Company | 12 Months Ended |
Dec. 31, 2020 | |
ICZOOM [Member] | |
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |
Date of Formation | Jun. 18, 2015 |
Place of Incorporation | Cayman Islands |
% of Ownership | 100% |
Principal Activities | Investment holding |
ICZOOM HK [Member] | |
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |
Date of Formation | May 22, 2012 |
Place of Incorporation | Hong Kong |
% of Ownership | 100% |
Principal Activities | Purchase of electronic components from overseas suppliers |
Ehub [Member] | |
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |
Date of Formation | Sep. 13, 2012 |
Place of Incorporation | Hong Kong |
% of Ownership | 100% |
Principal Activities | Purchase of electronic components from overseas suppliers |
Hjet HK [Member] | |
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |
Date of Formation | Aug. 06, 2013 |
Place of Incorporation | Hong Kong |
% of Ownership | 100% |
Principal Activities | Purchase of electronic components from overseas suppliers |
Components Zone HK [Member] | |
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |
Date of Formation | May 19, 2020 |
Place of Incorporation | Hong Kong |
% of Ownership | 100% |
Principal Activities | Investment holding |
ICZOOM WFOE [Member] | |
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |
Date of Formation | Sep. 17, 2020 |
Place of Incorporation | PRC |
% of Ownership | 100% |
Principal Activities | WFOE, Consultancy |
Hjet Shuntong [Member] | |
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |
Date of Formation | Nov. 08, 2013 |
Place of Incorporation | PRC |
% of Ownership | 100% |
Principal Activities | Investment holding |
Hjet Supply Chain [Member] | |
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |
Date of Formation | Jul. 03, 2006 |
Place of Incorporation | PRC |
% of Ownership | 100% |
Principal Activities | Order fulfilment |
ICZOOM Shenzhen [Member] | |
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |
Date of Formation | Jul. 20, 2015 |
Place of Incorporation | PRC |
% of Ownership | 100% |
Principal Activities | Sales of electronic components through B2B e-commerce platform |
Hjet Logistics [Member] | |
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |
Date of Formation | May 31, 2013 |
Place of Incorporation | PRC |
% of Ownership | 100% |
Principal Activities | Logistics and product shipping |
Heng Nuo Chen [Member] | |
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |
Date of Formation | May 25, 2015 |
Place of Incorporation | PRC |
% of Ownership | 100% |
Principal Activities | Logistics and product shipping. Deregistered in August 2021 |
Pai Ming Shenzhen [Member] | |
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |
Date of Formation | May 09, 2012 |
Place of Incorporation | PRC |
% of Ownership | 0% |
Principal Activities | Holds an EDI license and an ICP License. The VIE agreements has been terminated in December 2021 |
Organization and Business Des_5
Organization and Business Description (Details) - Schedule of Unaudited Balance Sheet - VIE [Member] - Pai Ming Shenzhen [Member] - USD ($) | Dec. 10, 2021 | Jun. 30, 2021 |
CURRENT ASSETS | ||
Cash | $ 41,912 | $ 2,891 |
Accounts receivable | 173,550 | |
Prepaid expenses and other current assets | 2,024 | 7,061 |
TOTAL CURRENT ASSETS | 217,486 | 9,952 |
Other noncurrent assets | 2,411 | 1,452 |
TOTAL ASSETS | 219,897 | 11,404 |
CURRENT LIABILITIES | ||
Accrued expenses and other current liabilities | 427,395 | 566,158 |
TOTAL CURRENT LIABILITIES | 427,395 | 566,158 |
TOTAL LIABILITIES | $ 427,395 | $ 566,158 |
Organization and Business Des_6
Organization and Business Description (Details) - Schedule of Unaudited Operation Statement - VIE [Member] - USD ($) | 5 Months Ended | 12 Months Ended |
Dec. 10, 2021 | Jun. 30, 2021 | |
Condensed Income Statements, Captions [Line Items] | ||
REVENUE, net | $ 36,273 | |
COST OF REVENUE | 32,229 | |
GROSS PROFIT | 4,044 | |
OPERATING EXPENSES | ||
Selling expenses | 37,809 | |
General and administrative expenses | 182,628 | |
Total operating expenses | 220,437 | |
LOSS FROM OPERATIONS | (216,393) | |
OTHER INCOME | ||
Other income, net | 243 | |
Total other income (expenses), net | 243 | |
LOSS BEFORE INCOME TAX PROVISION | (216,150) | |
PROVISION FOR INCOME TAXES | ||
NET LOSS | $ (216,150) | |
Pai Ming Shenzhen [Member] | ||
Condensed Income Statements, Captions [Line Items] | ||
REVENUE, net | $ 72,425 | |
COST OF REVENUE | 1,122 | |
GROSS PROFIT | 71,303 | |
OPERATING EXPENSES | ||
Selling expenses | 14,265 | |
General and administrative expenses | 75,751 | |
Total operating expenses | 90,016 | |
LOSS FROM OPERATIONS | (18,713) | |
OTHER INCOME | ||
Other income, net | 92 | |
Total other income (expenses), net | 92 | |
LOSS BEFORE INCOME TAX PROVISION | (18,621) | |
PROVISION FOR INCOME TAXES | ||
NET LOSS | $ (18,621) |
Organization and Business Des_7
Organization and Business Description (Details) - Schedule of Unaudited Cash flow - USD ($) | 5 Months Ended | 12 Months Ended | ||
Dec. 10, 2021 | Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2021 | |
Cash flows from operating activities: | ||||
Net loss | $ 1,751,170 | $ 2,569,810 | $ (216,150) | |
Changes in operating assets and liabilities: | ||||
Accounts receivable | 3,711,373 | 9,211,978 | ||
Advances to suppliers | ||||
Prepaid expenses and other current assets | (315,056) | (622,011) | (2,847) | |
Other noncurrent assets | (1,421) | |||
Accrued expenses and other current liabilities | 216,478 | |||
Net cash provided by (used in) operating activities | (3,751,832) | 138,550 | (3,940) | |
Effect of exchange rate fluctuation on cash | (1,391,813) | (1,362,562) | 515 | |
Net increase (decrease) in cash | $ 3,461,344 | (3,856,167) | (3,425) | |
Cash at beginning of the period | 6,316 | |||
Cash at end of the period | $ 2,891 | |||
Pai Ming Shenzhen [Member] | ||||
Cash flows from operating activities: | ||||
Net loss | $ (18,621) | |||
Changes in operating assets and liabilities: | ||||
Accounts receivable | ||||
Advances to suppliers | ||||
Prepaid expenses and other current assets | 4,095 | |||
Other noncurrent assets | ||||
Accrued expenses and other current liabilities | 53,198 | |||
Net cash provided by (used in) operating activities | 38,672 | |||
Effect of exchange rate fluctuation on cash | 349 | |||
Net increase (decrease) in cash | 39,021 | |||
Cash at beginning of the period | 2,891 | $ 2,891 | ||
Cash at end of the period | $ 41,912 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) - USD ($) | 12 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | ||
Summary of Significant Accounting Policies (Details) [Line Items] | |||
Restricted Cash Equivalents | $ 6,413,367 | ||
Notes receivable | $ 18,000 | ||
Allowance for uncollectable balances | 99,003 | ||
Inventory allowance | $ 1,851 | ||
Intangible assets over useful lives term | 10 years | ||
Deferred initial public offering costs | [1] | 629,748 | |
Deferred revenue | 1,671,353 | 3,651,700 | |
Cost of revenue | 209,112,615 | 282,561,907 | |
Selling expenses | 1,991,992 | 1,931,785 | |
Capitalized software development costs | 63,698 | 16,351 | |
General and administrative expenses | $ 437,261 | 530,144 | |
Tax benefit rate | 50% | ||
Income before taxes | $ 877,850 | 1,109,748 | |
Value added tax rate description | The Company is a general taxpayer and is subject to applicable VAT tax rate of 6% or 16%, and starting from April 1, 2019, the Company is subject to applicable VAT tax rate of 6% or 13%. | ||
Consolidated statements of income and comprehensive income amount | $ 175,762 | 199,472 | |
Government subsidies and other operating income | 125,125 | 213,741 | |
Shipping and Handling Costs [Member} | |||
Summary of Significant Accounting Policies (Details) [Line Items] | |||
Cost of revenue | 474,543 | 589,291 | |
Selling expenses | $ 423,606 | $ 445,840 | |
Minimum [Member] | |||
Summary of Significant Accounting Policies (Details) [Line Items] | |||
Investments rate | 1.50% | ||
Transaction and earns a commission fee percentage | 0.15% | ||
Maximum [Member] | |||
Summary of Significant Accounting Policies (Details) [Line Items] | |||
Investments rate | 2.50% | ||
Transaction and earns a commission fee percentage | 1.50% | ||
[1]Deferred initial public offering costs of nil |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) - Schedule of Depreciation and Amortization of Property and Equipment | 12 Months Ended |
Jun. 30, 2023 | |
Public Utility, Property, Plant and Equipment [Line Items] | |
Leasehold improvement | Lesser of useful life and lease term |
Office Equipment and Furniture [Member] | |
Public Utility, Property, Plant and Equipment [Line Items] | |
Expected useful lives | 3 years |
Automobiles [Member] | |
Public Utility, Property, Plant and Equipment [Line Items] | |
Expected useful lives | 5 years |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Details) - Schedule of Currency Exchange Rates | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Schedule Of Currency Exchange Rates Abstract | ||
Period-end spot rate | US$1=RMB 7.2254 | US$1=RMB 6.7114 |
Average rate | US$1=RMB 6.9881 | US$1=RMB 6.4641 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies (Details) - Schedule of Total Revenues by Product and Service Type - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Semiconductor: | ||
Total sales of electronic components products | $ 211,123,155 | $ 286,539,736 |
Service commission fees | 3,282,071 | 3,836,635 |
Total revenue | 214,405,226 | 290,376,371 |
Integrated Circuits [Member] | ||
Semiconductor: | ||
Total sales of electronic components products | 36,208,767 | 155,134,814 |
Power/Circuit Protection [Member] | ||
Semiconductor: | ||
Total sales of electronic components products | 13,902,350 | 15,971,800 |
Discrete [Member] | ||
Semiconductor: | ||
Total sales of electronic components products | 16,047,821 | 23,071,808 |
Passive Components [Member] | ||
Semiconductor: | ||
Total sales of electronic components products | 99,326,417 | 25,110,572 |
Optoelectronics/Electromechanical [Member] | ||
Semiconductor: | ||
Total sales of electronic components products | 8,535,997 | 12,056,185 |
Other Semiconductor Products [Member] | ||
Semiconductor: | ||
Total sales of electronic components products | 15,366,941 | 29,103,445 |
Equipment [Member] | ||
Semiconductor: | ||
Total sales of electronic components products | 10,102,545 | 8,745,020 |
Tools and Others [Member] | ||
Semiconductor: | ||
Total sales of electronic components products | $ 11,632,317 | $ 17,346,092 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies (Details) - Schedule of Computation of Basic and Diluted Earnings Per Share - USD ($) | 12 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | ||
Numerator: | |||
Net income attributable to ordinary shareholders (in Dollars) | $ 1,751,170 | $ 2,569,810 | |
Denominator: | |||
Weighted-average number of ordinary shares outstanding – basic | [1] | 9,201,374 | 8,826,374 |
Outstanding options | 742,762 | 751,012 | |
Potentially dilutive shares from outstanding options | 717,557 | 720,972 | |
Weighted-average number of ordinary shares outstanding – diluted | [1] | 9,918,931 | 9,547,346 |
Earnings per share – basic (in Dollars per share) | $ 0.19 | $ 0.29 | |
Earnings per share – diluted (in Dollars per share) | $ 0.18 | $ 0.27 | |
[1]Retrospectively restated for effect of 1-for-4 reverse split on November 2020 and 1-for-2 reverse split on August 8, 2022 of the ordinary shares, see Note 16. |
Accounts Receivable, Net (Detai
Accounts Receivable, Net (Details) | Jun. 30, 2023 |
Accounts Receivable, Net [Abstract] | |
Percentage of account receivables | 63.10% |
Accounts Receivable, Net (Det_2
Accounts Receivable, Net (Details) - Schedule of Accounts Receivable - USD ($) | Jun. 30, 2023 | Jun. 30, 2022 |
Accounts Receivable, Net [Line Items] | ||
Accounts receivable | $ 76,690,246 | $ 76,119,299 |
Less: allowance for doubtful accounts | (99,003) | |
Accounts receivable, net | $ 76,690,246 | $ 76,020,296 |
Accounts Receivable, Net (Det_3
Accounts Receivable, Net (Details) - Schedule of Outstanding Accounts Receivable and Subsequent Collection - USD ($) | Jun. 30, 2023 | Jun. 30, 2022 |
Condensed Financial Statements, Captions [Line Items] | ||
Accounts receivable | $ 76,690,246 | $ 76,119,299 |
Accounts receivable, subsequent collection | $ 48,357,633 | $ 76,119,299 |
Accounts receivable, % of collection | 63.10% | 100% |
AR Aged Less Than 6 Months [Member] | ||
Condensed Financial Statements, Captions [Line Items] | ||
Accounts receivable | $ 76,401,424 | $ 74,233,261 |
Accounts receivable, subsequent collection | $ 48,068,811 | $ 74,233,261 |
Accounts receivable, % of collection | 62.90% | 100% |
AR Aged From 7 to 12 Months [Member] | ||
Condensed Financial Statements, Captions [Line Items] | ||
Accounts receivable | $ 288,822 | $ 1,886,038 |
Accounts receivable, subsequent collection | $ 288,822 | $ 1,886,038 |
Accounts receivable, % of collection | 100% | 100% |
Accounts Receivable, Net (Det_4
Accounts Receivable, Net (Details) - Schedule of Allowance for Doubtful Accounts Movement - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Schedule of Allowance for Doubtful Accounts Movement [Abstract] | ||
Beginning balance | $ 99,003 | $ 133,059 |
Reversal | (99,003) | (30,187) |
Foreign currency translation adjustments | (3,869) | |
Ending balance | $ 99,003 |
Inventories, Net (Details) - Sc
Inventories, Net (Details) - Schedule of Inventories Net - USD ($) | Jun. 30, 2023 | Jun. 30, 2022 |
Inventories, Net [Line Items] | ||
Semiconductors | $ 764,592 | $ 324,410 |
Equipment, tools and others | 71,117 | 41,205 |
Inventory valuation allowance | (1,851) | |
Total inventory, net | $ 833,858 | $ 365,615 |
Advances To Suppliers (Details)
Advances To Suppliers (Details) $ in Millions | 12 Months Ended |
Jun. 30, 2023 USD ($) | |
Advances To Suppliers [Abstract] | |
Advance to suppliers percentage | 86.20% |
Advance to suppliers | $ 1.4 |
Advances To Suppliers (Detail_2
Advances To Suppliers (Details) - Schedule of Advances to Suppliers Net - USD ($) | Jun. 30, 2023 | Jun. 30, 2022 |
Advances To Suppliers [Line Items] | ||
Advances to suppliers | $ 1,608,941 | $ 6,613,280 |
Short-Term Invstment (Details)
Short-Term Invstment (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Short-Term Invstment (Details) [Line Items] | ||
Short-term investment | $ 14,748 | $ 30,775 |
Minimum [Member] | ||
Short-Term Invstment (Details) [Line Items] | ||
Short term investments percentage | 1.50% | |
Maximum [Member] | ||
Short-Term Invstment (Details) [Line Items] | ||
Short term investments percentage | 2.50% |
Short-Term Invstment (Details)
Short-Term Invstment (Details) - Schedule of Short-Term Investment - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Short-Term Investments [Line Items] | ||
Beginning balance | $ 1,490 | $ 928,800 |
Add: purchase additional wealth management financial products | 4,125,704 | 20,025,600 |
Less: proceeds received upon maturity of short-term investment | (4,127,088) | (20,918,110) |
Foreign currency translation adjustments | (106) | (34,800) |
Ending balance of short-term investment | $ 1,490 |
Prepaid Expenses and Other Cu_3
Prepaid Expenses and Other Current Assets (Details) - USD ($) | 12 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | ||
Prepaid Expenses And Other Current Assets [Abstract] | |||
Other receivable | $ 892,703 | ||
Advances to employees | 21,910 | ||
Security deposits | $ 317,459 | ||
Other receivable settled percentage | 74.90% | 74.90% | |
Deferred initial public offering costs | [1] | $ 629,748 | |
[1]Deferred initial public offering costs of nil |
Prepaid Expenses and Other Cu_4
Prepaid Expenses and Other Current Assets (Details) - Schedule of Prepaid Expenses and Other Current Assets - USD ($) | Jun. 30, 2023 | Jun. 30, 2022 | |
Prepaid Expenses and Other Current Assets (Details) - Schedule of Prepaid Expenses and Other Current Assets [Line Items] | |||
Other receivables, net | [1] | $ 1,286,920 | $ 1,706,767 |
Deferred initial public offering costs | [2] | 629,748 | |
Prepaid expenses | [3] | 54,281 | 96,398 |
Prepaid expenses and other current assets | $ 1,341,201 | $ 2,432,913 | |
[1]Other receivable primarily includes prepaid VAT input tax in connection with the Company’s purchase of electronic component products from third-party suppliers when VAT invoices have not been received as of the balance sheet date. Other receivable also includes, advances to employees for business development and security deposits for operating leases. As of June 30, 2023, the balance of other receivable mainly consists of $892,703 of prepaid VAT input tax, $21,910 of advances to employees and $317,459 of security deposits for operating leases. All the June 30, 2022 other receivable balance and approximately 74.9% of the June 30, 2023 other receivable balance has been collected or settled.[2]Deferred initial public offering costs of nil |
Property and Equipment, Net (De
Property and Equipment, Net (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation expense | $ 65,471 | $ 29,887 |
Property and Equipment, Net (_2
Property and Equipment, Net (Details) - Schedule of Property and Equipment, Net - USD ($) | Jun. 30, 2023 | Jun. 30, 2022 |
Property, Plant and Equipment [Line Items] | ||
Office equipment and furniture | $ 151,007 | $ 140,695 |
Automobiles | 69,782 | 62,580 |
Leasehold improvement | 403,778 | 369,065 |
Subtotal | 624,567 | 572,340 |
Less: accumulated depreciation | (498,535) | (453,096) |
Property and equipment, net | $ 126,032 | $ 119,244 |
Intangible Assets, Net (Details
Intangible Assets, Net (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization expense | $ 131,762 | $ 118,184 |
Intangible Assets, Net (Detai_2
Intangible Assets, Net (Details) - Schedule of Intangible Assets, Net - USD ($) | Jun. 30, 2023 | Jun. 30, 2022 |
Finite-Lived Intangible Assets [Line Items] | ||
Capitalized internal-use software development costs | $ 905,431 | $ 905,375 |
Less: accumulated amortization | (616,995) | (527,037) |
Intangible assets, net | $ 288,436 | $ 378,338 |
Intangible Assets, Net (Detai_3
Intangible Assets, Net (Details) - Schedule of Estimated Future Amortization Expense for Intangible Assets | Jun. 30, 2022 USD ($) |
Intangible Assets, Net (Details) - Schedule of Estimated Future Amortization Expense for Intangible Assets [Line Items] | |
2024 | $ 88,821 |
2025 | 78,094 |
2026 | 76,316 |
2027 | 30,840 |
2028 | 11,241 |
Thereafter | 3,124 |
Total | $ 288,436 |
Leases (Details)
Leases (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Leases [Abstract] | ||
Term of remaining lease | 1 year 10 months 24 days | |
Operating lease, discount rate | 3.35% | |
Operating lease expense | $ 432,422 | $ 582,631 |
Operating lease right-of-use assets | 381,795 | $ 41,968 |
Interest on lease liabilities amount | $ 28,685 |
Leases (Details) - Schedule of
Leases (Details) - Schedule of Operating Lease Related Assets and Liabilities on the Balance Sheets - USD ($) | Jun. 30, 2023 | Jun. 30, 2022 |
Leases (Details) - Schedule of Operating Lease Related Assets and Liabilities on the Balance Sheets [Line Items] | ||
Operating lease right-of-use assets | $ 1,274,479 | $ 732,993 |
Operating lease right-of-use assets – accumulated amortization | (411,627) | (40,422) |
Operating lease right-of-use assets – net | 862,852 | 692,571 |
Operating lease liabilities, current | 524,698 | 232,221 |
Operating lease liabilities, non-current | 375,056 | 480,436 |
Total operating lease liabilities, | $ 899,754 | $ 712,657 |
Leases (Details) - Schedule o_2
Leases (Details) - Schedule of Maturities of Operating Lease Liabilities - USD ($) | Jun. 30, 2023 | Jun. 30, 2022 |
Leases (Details) - Schedule of Maturities of Operating Lease Liabilities [Line Items] | ||
2024 | $ 549,919 | |
2025 | 376,604 | |
Total future minimum lease payments | 926,523 | |
Less: Imputed interest | (26,769) | |
Total | $ 899,754 | $ 712,657 |
Debt (Details)
Debt (Details) € in Thousands, £ in Thousands, ¥ in Millions, $ in Millions | 7 Months Ended | 12 Months Ended | |||||||||||||||||||||||||||||||||||||||||
Jun. 28, 2023 USD ($) | Jun. 24, 2023 USD ($) | Jun. 09, 2023 USD ($) | May 11, 2023 USD ($) | Apr. 25, 2023 USD ($) | Mar. 30, 2023 USD ($) | Mar. 28, 2023 USD ($) | Mar. 23, 2023 USD ($) | Mar. 10, 2023 USD ($) | Feb. 25, 2023 USD ($) | Feb. 22, 2023 USD ($) | Feb. 09, 2023 USD ($) | Dec. 09, 2022 USD ($) | Nov. 21, 2022 USD ($) | Nov. 14, 2022 USD ($) | Sep. 27, 2022 USD ($) | Sep. 23, 2022 USD ($) | Sep. 21, 2022 USD ($) | Sep. 09, 2022 USD ($) | Aug. 24, 2022 USD ($) | Aug. 15, 2022 USD ($) | Jun. 07, 2022 USD ($) | May 17, 2022 USD ($) | Mar. 24, 2022 USD ($) | Mar. 15, 2022 USD ($) | Dec. 31, 2022 | Jun. 30, 2023 USD ($) | Jun. 30, 2022 USD ($) | Jun. 28, 2023 GBP (£) | Jun. 28, 2023 JPY (¥) | Jun. 24, 2023 GBP (£) | Jun. 24, 2023 JPY (¥) | Apr. 25, 2023 CNY (¥) | Mar. 30, 2023 CNY (¥) | Mar. 28, 2023 JPY (¥) | Mar. 28, 2023 HKD ($) | Mar. 23, 2023 CNY (¥) | Nov. 21, 2022 GBP (£) | Nov. 21, 2022 EUR (€) | Sep. 27, 2022 GBP (£) | Sep. 27, 2022 JPY (¥) | Sep. 23, 2022 CNY (¥) | Sep. 21, 2022 CNY (¥) | |
Debt (Details) [Line Items] | |||||||||||||||||||||||||||||||||||||||||||
Short term borrowings | $ 1,000,000 | $ 1,000,000 | $ 1,100,000 | $ 1,300,000 | $ 1,900,000 | $ 2,200,000 | $ 1,500,000 | $ 2,000,000 | $ 1,200,000 | $ 3,200,000 | $ 1,300,000 | $ 1,200,000 | $ 1,000,000 | $ 1,000,000 | $ 1,200,000 | $ 2,300,000 | $ 2,000,000 | $ 1,200,000 | $ 3,000,000 | $ 1,300,000 | $ 1,300,000 | $ 1,300,000 | $ 2,300,000 | $ 2,700,000 | £ 800 | £ 820 | ¥ 13.9 | ¥ 16.1 | $ 0.8 | ¥ 13.9 | € 970 | £ 920 | ¥ 16.1 | ¥ 13.9 | |||||||||
Loan maturity date | Jun. 27, 2024 | Jun. 21, 2023 | Sep. 05, 2023 | Aug. 08, 2023 | Oct. 20, 2023 | Sep. 26, 2023 | Mar. 27, 2024 | Sep. 17, 2023 | Jun. 07, 2023 | Aug. 22, 2022 | Aug. 18, 2023 | May 09, 2023 | Mar. 08, 2023 | Nov. 21, 2023 | Feb. 08, 2023 | Sep. 27, 2023 | Mar. 22, 2023 | Mar. 20, 2023 | Dec. 07, 2022 | Feb. 19, 2023 | Nov. 09, 2022 | Sep. 05, 2022 | Aug. 12, 2022 | Sep. 20, 2022 | Sep. 13, 2022 | ||||||||||||||||||
Effective interest rate | 6.02% | 1.91% | 5.52% | 5.56% | 2.85% | 4.64% | 3.02% | 4.64% | 4.95% | 1.90% | 5.69% | 5.11% | 4.81% | 2.58% | 5.20% | 4.51% | 4.64% | 4.64% | 3.19% | 4% | 3.10% | 2.15% | 2.10% | 4.20% | 4.20% | 3.60% | 6.02% | 6.02% | 1.91% | 1.91% | 2.85% | 4.64% | 3.02% | 3.02% | 4.64% | 2.58% | 2.58% | 4.51% | 4.51% | 4.64% | 4.64% | ||
short-term loan | $ 2,750,000 | $ 14,022,523 | $ 11,760,387 | ||||||||||||||||||||||||||||||||||||||||
Pledged deposits | $ 1,000,000 | $ 1,000,000 | $ 1,480,000 | $ 1,030,000 | $ 1,060,000 | ¥ 144,000,000 | ¥ 136,300,000 | ¥ 196,800,000 | £ 840 | ¥ 144,700,000 | |||||||||||||||||||||||||||||||||
Related parties incurred loan origination fee to be paid | 292,998 | 142,430 | |||||||||||||||||||||||||||||||||||||||||
Deferred financing cost | 215,370 | 197,366 | |||||||||||||||||||||||||||||||||||||||||
Interest expense | 530,568 | 293,102 | |||||||||||||||||||||||||||||||||||||||||
Short term maturity date, description | November 2022 to March 2023 | ||||||||||||||||||||||||||||||||||||||||||
Outstanding balance | 0 | ||||||||||||||||||||||||||||||||||||||||||
Related Party [Member] | |||||||||||||||||||||||||||||||||||||||||||
Debt (Details) [Line Items] | |||||||||||||||||||||||||||||||||||||||||||
Interest expense on third-party | $ 8,592 | $ 33,391 |
Debt (Details) - Schedule of Sh
Debt (Details) - Schedule of Short-Term Loans - USD ($) | Aug. 23, 2023 | Jun. 30, 2023 | Jun. 30, 2022 |
Debt (Details) - Schedule of Short-Term Loans [Line Items] | |||
Total short-term loans, net | $ 2 | $ 14,022,523 | $ 11,760,387 |
Less: Debt issuance cost | (11,593) | (48,013) | |
Shanghai Pudong Development Bank [Member] | |||
Debt (Details) - Schedule of Short-Term Loans [Line Items] | |||
Total short-term loans, net | 4,152,000 | 5,000,000 | |
Agricultural Bank of China [Member] | |||
Debt (Details) - Schedule of Short-Term Loans [Line Items] | |||
Total short-term loans, net | 2,750,000 | 3,200,000 | |
Industrial and Commercial Bank of China [Member] | |||
Debt (Details) - Schedule of Short-Term Loans [Line Items] | |||
Total short-term loans, net | 2,400,000 | 2,600,000 | |
Bank Of China [Member] | |||
Debt (Details) - Schedule of Short-Term Loans [Line Items] | |||
Total short-term loans, net | $ 4,732,116 | $ 1,008,400 |
Accounts Payable (Details)
Accounts Payable (Details) | Jun. 30, 2022 |
Accounts Payable [Abstract] | |
Accounts payable balance percentage | 70.70% |
Accounts Payable (Details) - Sc
Accounts Payable (Details) - Schedule of Outstanding Accounts Payable and Subsequent Settlement by Aging Bucket - USD ($) | Jun. 30, 2023 | Jun. 30, 2022 |
Accounts Payable (Details) - Schedule of Outstanding Accounts Payable and Subsequent Settlement by Aging Bucket [Line Items] | ||
Total accounts payable | $ 51,127,328 | $ 59,558,743 |
Subsequent settlement | $ 36,149,775 | $ 59,558,743 |
% of collection | 70.70% | 100% |
Accounts payable aged less than 6 months [Member] | ||
Accounts Payable (Details) - Schedule of Outstanding Accounts Payable and Subsequent Settlement by Aging Bucket [Line Items] | ||
Total accounts payable | $ 50,049,201 | $ 59,541,103 |
Subsequent settlement | $ 35,071,648 | $ 59,541,103 |
% of collection | 70.10% | 100% |
Accounts payable aged from 7 to 12 months [Member] | ||
Accounts Payable (Details) - Schedule of Outstanding Accounts Payable and Subsequent Settlement by Aging Bucket [Line Items] | ||
Total accounts payable | $ 1,078,127 | $ 17,640 |
Subsequent settlement | $ 1,078,127 | $ 17,640 |
% of collection | 100% | 100% |
Taxes (Details)
Taxes (Details) $ in Millions | 1 Months Ended | 12 Months Ended | ||||
Apr. 01, 2018 | Dec. 31, 2021 USD ($) | Jun. 30, 2023 USD ($) | Jun. 30, 2023 HKD ($) | Jun. 30, 2022 USD ($) | Dec. 31, 2020 | |
Taxes (Details) [Line Items] | ||||||
Assessable profit | $ 2,000,000 | $ 2 | ||||
Valuation allowance deferred tax assets (in Dollars) | $ 158,621 | $ (145,632) | $ 7,037 | |||
HONG KONG | ||||||
Taxes (Details) [Line Items] | ||||||
Profit tax rate | 16.50% | 16.50% | 16.50% | 16.50% | ||
HONG KONG | Ehub [Member] | ||||||
Taxes (Details) [Line Items] | ||||||
Profit tax rate | 8.25% | 8.25% | ||||
Assessable profit | $ 2 | |||||
HONG KONG | Minimum [Member] | ||||||
Taxes (Details) [Line Items] | ||||||
Profit tax rate | 8.25% | 8.25% | ||||
HONG KONG | Maximum [Member] | ||||||
Taxes (Details) [Line Items] | ||||||
Profit tax rate | 16.50% | 16.50% | ||||
PRC [Member] | ||||||
Taxes (Details) [Line Items] | ||||||
Profit tax rate | 25% | 25% | ||||
PRC [Member] | HNTE [Member] | ||||||
Taxes (Details) [Line Items] | ||||||
Profit tax rate | 15% | 15% | 15% | |||
PRC [Member] | ||||||
Taxes (Details) [Line Items] | ||||||
Valuation allowance deferred tax assets (in Dollars) | $ 406,760 | $ 576,432 |
Taxes (Details) - Schedule of C
Taxes (Details) - Schedule of Components of Income Tax Provision - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Current tax provision | ||
Current tax provision | $ 242,204 | $ 581,282 |
Deferred tax provision (benefit) | ||
Deferred tax provision (benefit) | 23,465 | 5,994 |
Income tax provision | 265,670 | 587,276 |
Cayman Islands [Member] | ||
Current tax provision | ||
Current tax provision | ||
Deferred tax provision (benefit) | ||
Deferred tax provision (benefit) | ||
Hong Kong [Member] | ||
Current tax provision | ||
Current tax provision | 84,828 | 183,197 |
Deferred tax provision (benefit) | ||
Deferred tax provision (benefit) | (305) | |
China [Member] | ||
Current tax provision | ||
Current tax provision | 157,376 | 398,085 |
Deferred tax provision (benefit) | ||
Deferred tax provision (benefit) | $ 23,771 | $ 5,994 |
Taxes (Details) - Schedule of R
Taxes (Details) - Schedule of Reconciliation of Differences Between Income Tax Provision Computed Based on PRC Statutory Income Tax Rate and Actual Income Tax Provision - USD ($) | 1 Months Ended | 12 Months Ended | ||
Dec. 31, 2021 | Jun. 30, 2023 | Jun. 30, 2022 | ||
Schedule of Reconciliation of Differences Between Income Tax Provision Computed Based on PRC Statutory Income Tax Rate and Actual Income Tax Provision [Abstract] | ||||
Income tax expense computed based on PRC statutory rate | $ 504,210 | $ 709,419 | ||
Effect of rate differential for Hong Kong entities | (110,932) | (146,790) | ||
Non-deductible expenses: | ||||
Stock-based compensation | [1] | 14,649 | 13,543 | |
Meals and entertainment | 3,375 | 4,067 | ||
Change in valuation allowance | $ 158,621 | (145,632) | 7,037 | |
Actual income tax provision | $ 265,670 | $ 587,276 | ||
[1]The Company’s stock-based compensation expenses were recorded under the Cayman parent company level. Pursuant to the current tax laws of the Cayman Islands, the Company is not subject to tax on its income or capital gains. As a result, stock-based compensation expenses are non-deductible expenses for income tax purposes. |
Taxes (Details) - Schedule of D
Taxes (Details) - Schedule of Deferred Tax Assets - USD ($) | Jun. 30, 2023 | Jun. 30, 2022 |
Schedule of Deferred Tax Assets [Abstract] | ||
Deferred tax assets derived from net operating loss (“NOL”) carry forwards | $ 406,760 | $ 576,432 |
Allowance for doubtful accounts | 24,751 | |
Allowance of Inventory | 305 | |
Less: valuation allowance | (406,760) | (576,432) |
Deferred tax assets | $ 305 | $ 24,751 |
Taxes (Details) - Schedule of V
Taxes (Details) - Schedule of Valuation Allowance - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Schedule Of Valuation Allowance [Abstract] | ||
Balance at beginning of the period | $ 576,432 | $ 726,607 |
Current period addition/(reversal) | (169,672) | 8,446 |
Effect due to the termination of VIE | (158,621) | |
Balance at end of the period | $ 406,760 | $ 576,432 |
Taxes (Details) - Schedule of T
Taxes (Details) - Schedule of Taxes payable - USD ($) | Jun. 30, 2023 | Jun. 30, 2022 |
Schedule Of Taxes Payable [Abstract] | ||
Income tax payable | $ 2,363,980 | $ 2,445,687 |
Value added tax payable | 568,157 | 229,315 |
Total taxes payable | $ 2,932,137 | $ 2,675,002 |
Related Party Transactions (Det
Related Party Transactions (Details) | 3 Months Ended | 12 Months Ended | ||
Apr. 19, 2022 USD ($) | Jun. 30, 2023 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2022 CNY (¥) | |
Related Party Transactions [Abstract] | ||||
Loan origination fees | $ 292,998 | $ 142,430 | ||
Service fee (in Yuan Renminbi) | ¥ | ¥ 100,000 | |||
Related party transactions amount | $ 48,885 |
Related Party Transactions (D_2
Related Party Transactions (Details) - Schedule of Due to related parties consists - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Related Party Transaction [Line Items] | ||
Total due to related parties | $ 1,508,766 | $ 349,684 |
Mrs. Duanrong Liu [Member] | ||
Related Party Transaction [Line Items] | ||
Related party relationship | Shareholder, Director and Chief Operating Officer | |
Total due to related parties | $ 1,451,842 | 282,336 |
Mr. Lei Xia [Member] | ||
Related Party Transaction [Line Items] | ||
Related party relationship | Shareholder, Chairman and Chief Executive Officer | |
Total due to related parties | $ 21,943 | 28,884 |
Other shareholders [Member] | ||
Related Party Transaction [Line Items] | ||
Related party relationship | Shareholders of the Company | |
Total due to related parties | $ 34,981 | $ 38,464 |
Concentrations (Details)
Concentrations (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Revenue Benchmark [Member] | Customer Concentration Risk [Member] | Single Customer [Member] | ||
Concentrations (Details) [Line Items] | ||
Total revenue percentage | 10% | 10% |
Revenue Benchmark [Member] | Customer Concentration Risk [Member] | Ten Customer [Member] | ||
Concentrations (Details) [Line Items] | ||
Total revenue percentage | 26.70% | 24.10% |
Number of Customer | 10 | |
Account Receivable [Member] | Customer Concentration Risk [Member] | Other Customer [Member] | ||
Concentrations (Details) [Line Items] | ||
Total revenue percentage | 10% | 10% |
PRC [Member] | ||
Concentrations (Details) [Line Items] | ||
Restricted cash (in Dollars) | $ 5,713,265 | $ 2,079,445 |
Other Supplier [Member] | Advance to Suppler [Member] | Customer Concentration Risk [Member] | ||
Concentrations (Details) [Line Items] | ||
Total revenue percentage | 10% | 10% |
One Supplier [Member] | Account Payable [Member] | Supplier Concentration Risk [Member] | ||
Concentrations (Details) [Line Items] | ||
Total revenue percentage | 10% | 10% |
One Supplier [Member] | Total Purchases [Member] | Supplier Concentration Risk [Member] | ||
Concentrations (Details) [Line Items] | ||
Total revenue percentage | 10% | 10% |
Shareholders' Equity (Details)
Shareholders' Equity (Details) - USD ($) | 12 Months Ended | ||||||
Aug. 08, 2022 | Aug. 25, 2021 | Nov. 13, 2020 | Jun. 30, 2023 | Mar. 15, 2023 | Jun. 30, 2022 | ||
Shareholders' Equity (Details) [Line Items] | |||||||
Number of shares | 100,000,000 | ||||||
Shares per share value (in Dollars per share) | $ 0.02 | ||||||
Description of reverse split | On August 8, 2022, the Company amended its Memorandum of Association to reverse split the authorized number of shares at a ratio of 1-for-2 share to 35 million shares with par value of US$0.16 per share, and reverse split the issued shares from 17,652,743 shares at par value of US$0.08 per share to 8,826,374 ordinary shares with par value of $0.16 per share. The reverse split is considered part of the Reorganization of the Company, which was retroactively applied as if the transaction occurred at the beginning of the period presented (see Note1). | On November 13, 2020, the Company amended its Memorandum of Association to reverse split the authorized number of shares at a ratio of 1-for-4 share to 25 million shares with par value of US$0.08 per share, and reverse split the issued shares from 70,610,963 shares at par value of US$0.02 per share to 17,652,743 ordinary shares with par value of $0.08 per share. The reverse split is considered part of the Reorganization of the Company, which was retroactively applied as if the transaction occurred at the beginning of the period presented. | |||||
Ordinary shares, shares Outstanding | [1] | 10,326,374 | 8,826,374 | ||||
Ordinary shares, shares issued | [1] | 10,326,374 | 8,826,374 | ||||
Total restricted net assets amount (in Dollars) | $ 21,071,864 | $ 16,535,529 | |||||
Maximum [Member] | |||||||
Shareholders' Equity (Details) [Line Items] | |||||||
Increase in authorized shares | 70,000,000 | ||||||
Minimum [Member] | |||||||
Shareholders' Equity (Details) [Line Items] | |||||||
Increase in authorized shares | 25,000,000 | ||||||
Class A Ordinary shares | |||||||
Shareholders' Equity (Details) [Line Items] | |||||||
Number of shares | 60,000,000 | ||||||
Stockholders equity note changes in capital structure subsequent increases to par value of common shares (in Dollars per share) | $ 0.08 | ||||||
Ordinary shares, shares Outstanding | 6,496,874 | 4,996,874 | |||||
Ordinary shares, shares issued | 6,496,874 | 1,500,000 | 4,996,874 | ||||
Class A Ordinary shares | Maximum [Member] | |||||||
Shareholders' Equity (Details) [Line Items] | |||||||
Class A ordinary shares have been changed | 60,000,000 | 60,000,000 | |||||
Increase in authorized shares | 60,000,000 | 60,000,000 | |||||
Class A Ordinary shares | Minimum [Member] | |||||||
Shareholders' Equity (Details) [Line Items] | |||||||
Class A ordinary shares have been changed | 30,000,000 | 15,000,000 | |||||
Increase in authorized shares | 15,000,000 | 15,000,000 | |||||
Class B Ordinary shares | |||||||
Shareholders' Equity (Details) [Line Items] | |||||||
Number of shares | 40,000,000 | ||||||
Ordinary shares, shares Outstanding | 3,829,500 | 3,829,500 | |||||
Ordinary shares, shares issued | 3,829,500 | 3,829,500 | |||||
Class B Ordinary shares | Maximum [Member] | |||||||
Shareholders' Equity (Details) [Line Items] | |||||||
Class A ordinary shares have been changed | 10,000,000 | 40,000,000 | |||||
Increase in authorized shares | 10,000,000 | ||||||
Class B Ordinary shares | Minimum [Member] | |||||||
Shareholders' Equity (Details) [Line Items] | |||||||
Class A ordinary shares have been changed | 5,000,000 | 10,000,000 | |||||
Increase in authorized shares | 10,000,000 | ||||||
PRC [Member] | |||||||
Shareholders' Equity (Details) [Line Items] | |||||||
Total restricted net assets amount (in Dollars) | $ 624,097 | $ 624,097 | |||||
[1]Retrospectively restated for effect of 1-for-4 reverse split on November 2020 and 1-for-2 reverse split on August 8, 2022 of the ordinary shares, see Note 16. |
Share-Based Compensation (Detai
Share-Based Compensation (Details) | 12 Months Ended | ||||||||
Mar. 19, 2021 $ / shares shares | Jan. 15, 2020 $ / shares shares | Dec. 21, 2018 $ / shares shares | Dec. 22, 2017 $ / shares shares | Dec. 26, 2016 $ / shares shares | Oct. 05, 2015 $ / shares shares | Jun. 30, 2023 USD ($) $ / shares shares | Jun. 30, 2022 USD ($) $ / shares shares | Jun. 30, 2021 $ / shares | |
Share-Based Compensation (Details) [Line Items] | |||||||||
Employee stock plann | 50,000,000 | ||||||||
Shares reserved for issuance | 6,250,000 | ||||||||
Exercise price (in Dollars per share) | $ / shares | $ 0.18 | $ 0.17 | $ 0.16 | ||||||
Share-Based compensation Period | 4 years | ||||||||
Shares purchase | |||||||||
Exercise price per shares (in Dollars per share) | $ / shares | |||||||||
Share options vested amount (in Dollars) | $ | $ 9,366 | $ 71,845 | |||||||
Share-based compensation expense (in Dollars) | $ | 102,783 | $ 54,717 | |||||||
Outstanding share options were forfeited | 209,143 | ||||||||
Unrecognized share-based compensation (in Dollars) | $ | $ 531,616 | ||||||||
unrecognized share-based compensation (in Dollars) | $ | $ 102,783 | ||||||||
weighted-average vesting | 0 years | 1 year 29 days | |||||||
Board of Directors Chairman [Member] | |||||||||
Share-Based Compensation (Details) [Line Items] | |||||||||
Grant employees | 68 | ||||||||
Shares purchase | 579,100 | ||||||||
Exercise price per shares (in Dollars per share) | $ / shares | $ 2.4 | ||||||||
Common Class A [Member] | |||||||||
Share-Based Compensation (Details) [Line Items] | |||||||||
Options purchased shares | 33,788 | 44,250 | 213,125 | 64,250 | 795,644 | ||||
Exercise price (in Dollars per share) | $ / shares | $ 2.4 | $ 0.16 | $ 0.16 | $ 0.16 | $ 0.16 | ||||
Share-Based compensation Period | 4 years | 4 years | 4 years | 4 years | 4 years |
Share-Based Compensation (Det_2
Share-Based Compensation (Details) - Schedule of summarizes the Company’s stock option activities - USD ($) | 12 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2021 | |
Schedule of summarizes the Company’s stock option activities [Abstract] | |||
Options Outstanding Ending (in Shares) | 742,762 | 751,012 | 960,174 |
Weighted Average Exercise Price Outstanding Ending | $ 0.18 | $ 0.16 | $ 0.18 |
Weighted Average Remaining Contractual term Outstanding Ending | 18 days | 1 year 18 days | 2 years 9 months 18 days |
Fair Value Outstanding Ending (in Dollars) | $ 829,686 | $ 878,845 | $ 2,551,737 |
Options Exercisable, June 30 (in Shares) | 742,762 | 749,440 | 949,093 |
Weighted Average Exercise Price Exercisable | $ 0.18 | $ 0.17 | $ 0.16 |
Weighted Average Remaining Contractual term Exercisable Ending | 18 days | 1 year 14 days | 2 years 9 months 3 days |
Fair Value Exercisable Ending (in Dollars) | $ 829,686 | $ 869,478 | $ 2,470,526 |
Options Granted (in Shares) | |||
Weighted Average Exercise Price Granted | |||
Fair Value Granted | |||
Options Forfeited (in Shares) | (8,250) | (209,162) | |
Weighted Average Exercise Price Forfeited | $ 0.16 | $ 0.16 | |
Fair Value Forfeited | $ (49,159) | $ (1,672,892) | |
Options Exercised (in Shares) | |||
Weighted Average Exercise Price Exercised | |||
Fair Value Exercised (in Dollars) |
Commitments and Contingencies_2
Commitments and Contingencies (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Total operating lease expense | $ 432,422 | $ 582,631 |
Commitments and Contingencies_3
Commitments and Contingencies (Details) - Schedule of Operating lease Future Minimum Lease Payments | Jun. 30, 2023 USD ($) |
Schedule Of Operating Lease Future Minimum Lease Payments Abstract | |
2024 | $ 144,803 |
2025 | 93,757 |
Total | $ 238,560 |
Subsequent Events (Details)
Subsequent Events (Details) ¥ in Millions | 1 Months Ended | 3 Months Ended | |||||||||||||||||||
Oct. 27, 2023 USD ($) | Oct. 24, 2023 USD ($) | Oct. 07, 2023 USD ($) | Sep. 07, 2023 USD ($) | Aug. 29, 2023 USD ($) | Aug. 23, 2023 USD ($) | Aug. 10, 2023 USD ($) | Aug. 04, 2023 USD ($) | Oct. 24, 2023 USD ($) | Jul. 20, 2023 USD ($) | Sep. 30, 2023 USD ($) | Oct. 27, 2023 CNY (¥) | Oct. 24, 2023 CNY (¥) | Oct. 07, 2023 CNY (¥) | Aug. 29, 2023 CNY (¥) | Aug. 29, 2023 JPY (¥) | Aug. 23, 2023 CNY (¥) | Aug. 04, 2023 CNY (¥) | Jul. 20, 2023 CNY (¥) | Jun. 30, 2023 USD ($) | Jun. 30, 2022 USD ($) | |
Subsequent Events (Details) [Line Items] | |||||||||||||||||||||
Outstanding short-term bank loans | $ 14,500,000 | ||||||||||||||||||||
Borrowed amount | $ 2 | $ 14,022,523 | $ 11,760,387 | ||||||||||||||||||
Loan maturity date | Apr. 19, 2024 | Apr. 19, 2024 | Apr. 19, 2024 | ||||||||||||||||||
Subsequent Event [Member] | |||||||||||||||||||||
Subsequent Events (Details) [Line Items] | |||||||||||||||||||||
Borrowed amount | $ 1,000,000 | $ 1,300,000 | $ 100,000 | $ 0.3 | ¥ 900,000 | ¥ 1,000,000 | ¥ 2,200,000 | ||||||||||||||
Loan maturity date | Aug. 28, 2024 | Nov. 07, 2023 | Oct. 03, 2024 | Mar. 13, 2024 | Aug. 28, 2024 | Aug. 28, 2024 | Oct. 03, 2024 | Mar. 13, 2024 | |||||||||||||
Interest rate | 3.73% | 5.90% | 8.82% | 3.85% | |||||||||||||||||
Term deposits | $ 1,000,000 | ¥ 146.6 | |||||||||||||||||||
Forecast [Member] | |||||||||||||||||||||
Subsequent Events (Details) [Line Items] | |||||||||||||||||||||
Outstanding short-term bank loans | $ 10,600,000 | ||||||||||||||||||||
Borrowed amount | $ 1,900,000 | $ 2,200,000 | $ 300,000 | $ 1,100,000 | $ 2,200,000 | $ 11,100,000 | ¥ 14,000,000 | ¥ 16,000,000 | ¥ 2,000,000 | ¥ 20 | |||||||||||
Loan maturity date | Apr. 24, 2024 | Oct. 17, 2025 | Dec. 05, 2023 | Feb. 18, 2024 | Apr. 24, 2024 | Oct. 17, 2025 | Feb. 18, 2024 | ||||||||||||||
Interest rate | 2.61% | 2.74% | 10.26% | 5.99% | 3.80% |
Financial Information of the _3
Financial Information of the Parent Company (Details) | Jun. 30, 2023 |
PRC [Member] | |
Financial Information of the Parent Company (Details) [Line Items] | |
Net Assets Percentage | 25% |
Financial Information of the _4
Financial Information of the Parent Company (Details) - Schedule of Parent Company Balance Sheets - Parent Company [Member] - USD ($) | Jun. 30, 2023 | Jun. 30, 2022 |
Non-current asset | ||
Investment in subsidiaries and the VIE | $ 15,544,196 | $ 10,494,915 |
Total assets | 15,544,196 | 10,494,915 |
LIABILITIES | ||
SHAREHOLDERS’ EQUITY | ||
Common stock value | ||
Additional paid-in capital | 18,795,548 | 14,499,213 |
Accumulated deficit | (4,710,203) | (6,461,373) |
Accumulated other comprehensive income(loss) | (193,368) | 1,044,856 |
Total shareholders’ equity | 15,544,196 | 10,494,915 |
Total liabilities and shareholders’ equity | 15,544,196 | 10,494,915 |
Class A Ordinary shares | ||
SHAREHOLDERS’ EQUITY | ||
Common stock value | 1,039,499 | 799,499 |
Class B Ordinary Shares [Member] | ||
SHAREHOLDERS’ EQUITY | ||
Common stock value | $ 612,720 | $ 612,720 |
Financial Information of the _5
Financial Information of the Parent Company (Details) - Schedule of Parent Company Balance Sheets (Parentheticals) - Parent Company [Member] - shares | Jun. 30, 2023 | Jun. 30, 2022 |
Condensed Balance Sheet Statements, Captions [Line Items] | ||
Ordinary Shares Authorized | 35,000,000 | 35,000,000 |
Ordinary Shares issued | 10,326,374 | 8,826,374 |
Ordinary shares outstanding | 10,326,374 | 8,826,374 |
Class A Ordinary shares | ||
Condensed Balance Sheet Statements, Captions [Line Items] | ||
Ordinary Shares Authorized | 30,000,000 | 30,000,000 |
Ordinary Shares issued | 6,496,874 | 4,996,874 |
Ordinary shares outstanding | 6,496,874 | 4,996,874 |
Class B Ordinary Shares [Member] | ||
Condensed Balance Sheet Statements, Captions [Line Items] | ||
Ordinary Shares Authorized | 5,000,000 | 5,000,000 |
Ordinary Shares issued | 3,829,500 | 3,829,500 |
Ordinary shares outstanding | 3,829,500 | 3,829,500 |
Financial Information of the _6
Financial Information of the Parent Company (Details) - Schedule of Parent Company Statements of Comprehensive Income - Parent Company [Member] - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Condensed Statement of Income Captions [Line Items] | ||
EQUITY IN EARNINGS OF SUBSIDIARIES AND VIE | $ 1,751,170 | $ 2,569,810 |
NET INCOME | 1,751,170 | 2,569,810 |
FOREIGN CURRENCY TRANSLATION ADJUSTMENTS | (1,238,224) | 817,991 |
COMPREHENSIVE INCOME ATTRIBUTABLE TO THE COMPANY | $ 512,946 | $ 3,387,801 |
Financial Information of the _7
Financial Information of the Parent Company (Details) - Schedule of Parent Company Statements of Cash Flows - Parent Company [Member] - USD ($) | 12 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 1,751,170 | $ 2,569,810 |
Adjustments to reconcile net cash flows from operating activities: | ||
Equity in earnings of subsidiaries and VIE | (1,751,170) | (2,569,810) |
Net cash used in operating activities | ||
CHANGES IN CASH AND RESTRICTED CASH | ||
Cash and restricted cash at beginning of year | ||
Cash and restricted cash at end of year |