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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_______________
FORM 10-Q
☑
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
For the quarterly period ended September 30, 2022
☐ TRANSITION
REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT OF 1934
For the transition period from ______ to _______
Commission File Number 000-53737
SUIC Worldwide Holdings Ltd.
(Exact
name of registrant as specified in its charter)
Nevada (State
of incorporation)
47-2148252 (I.R.S. Employer Identification No.)
136-20 38th Ave. Unit 3G
Flushing,
NY 11354
(Address
of Principal Executive Offices)
_______________
(929)
391-2550
(Issuer
Telephone number)
Check
whether the issuer (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 12 months
(or for such shorter period that the issuer was required to file such reports), and (2) has been subject to such filing requirements for
the past 90 days. Yes ☑ No ☐
Indicate
by check mark whether the registrant has submitted electronically and posted on its corporate web site, if any, every Interactive Data
File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12
months (or for such shorter period that the registrant was required to submit and post such files). Yes ☑ No ☐
Indicate by check mark whether the registrant is a
larger accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of "accelerated filer and large accelerated
filer" in Rule 12b-2 of the Exchange Act. (Check one)
| Large
accelerated filer ☐ |
Accelerated
filer ☐ |
| Non-accelerated filer ☐ |
Smaller
reporting company ☑ |
| |
Emerging
growth company ☐ |
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate
by check mark whether the registrant is a shell company as defined in Rule 12b-2 of the Exchange Act. Yes ☐ No ☑
At September 30, 2022, there were 33,503,604 shares
of the registrant's common stock issued and outstanding.
SUIC Worldwide Holdings Ltd.
FORM 10-Q
September 30, 2022
INDEX
PART I-- FINANCIAL INFORMATION
| Item 1. |
Financial Statements |
3 |
| Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations. |
11 |
| Item 3. |
Quantitative and Qualitative Disclosures About Market Risk |
14 |
| Item 4. |
Control and Procedures |
14 |
PART II-- OTHER INFORMATION
| Item 1. |
Legal Proceedings |
16 |
| Item 2. |
Unregistered Sales of Equity Securities and Use of Proceeds |
16 |
| Item 3. |
Defaults Upon Senior Securities |
16 |
| Item 4. |
Mine Safety Disclosures. |
16 |
| Item 5. |
Other Information. |
16 |
| Item 6. |
Exhibits |
16 |
| SIGNATURES |
17 |
SUIC Worldwide Holdings Ltd.
Index to the consolidated financial statements
| Table
of Contents |
Page(s) |
| Balance
Sheets at September 30, 2022 (Unaudited) and December 31, 2021 |
F-2 |
| Unaudited
Statements of Operations for the Three and Nine Months Ended September 30, 2022 and 2021 |
F-3 |
| Unaudited
Statement of Stockholders’ Equity for the Nine Months Ended September 30, 2022 |
F-4 |
| Unaudited
Statements of Cash Flows for the Nine Months Ended September 30, 2022 and 2021 |
F-5 |
| Notes
to the Consolidated Financial Statements (Unaudited) |
F-6
- F-9 |
SUIC Worldwide Holdings Ltd.
Balance Sheet
September 30, 2022
See accompanying notes to the financial statements.
SUIC Worldwide Holdings Ltd.
Statements of Operations
(Unaudited)
See accompanying notes to the financial statements.
SUIC Worldwide Holdings Ltd.
Statements of Stockholders' Equity (Deficiency)
See accompanying notes to the financial statements.
SUIC Worldwide Holdings Ltd.
Statements of Cash Flows
(Unaudited)
The accompanying notes
are an integral part of these financial statements.
SUIC Worldwide Holdings Ltd.
Notes to the Financial Statements
September 30, 2022
(Unaudited)
Note 1 – Organization and Basis of presentation
Organization
The accompanying consolidated financial statements
of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“US
GAAP”) and include the accounts of the Company and its wholly owned subsidiary. All inter-company transactions and balances are
eliminated in consolidation.
Certain amounts in last year’s financial
statements have been reclassified to conform to current year presentation.
Interim Financial Statements
These interim unaudited financial statements have
been prepared in accordance with accounting principles generally accepted in the United States for interim financial information. They
do not include all of the information and footnotes required by generally accepted accounting principles for complete consolidated financial
statements. Therefore, these consolidated financial statements should be read in conjunction with the Company's audited financial statements
and notes thereto contained in its report on Form 10-K for the year ended December 31, 2021.
The consolidated financial statements included herein
are unaudited; however, they contain all normal recurring accruals and adjustments that, in the opinion of management, are necessary to
present fairly the Company's financial position at September 30, 2022, and the results of its operations and cash flows for the nine months
ended September 30, 2022. The results of operations for the period ended September 30, 2022 are not necessarily indicative of the results
to be expected for future quarters or the full year.
Note 2 – Going Concern
The accompanying consolidated financial statements
have been prepared assuming that the Company will continue as a going concern. The Company had a working capital deficit of $19,114, an
accumulated deficit of $1,700,348 and stockholders’ deficiency was $19,114 as of September 30, 2022. The Company did not generate
cash or income from its continuing operation. These factors, among others, raise substantial doubt about the Company’s ability to
continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of
this uncertainty.
The company is developing new businesses in various
fields. There are no assurances that the Company will be able to either (1) achieve a level of revenues adequate to generate sufficient
cash flow from operations; or (2) obtain additional financing through either private placement, public offerings and/or bank financing
necessary to support the Company’s working capital requirements. To the extent that funds generated from any private placements,
public offering and/or bank financing are insufficient to support the Company’s working capital requirements, the Company will have
to raise additional working capital from additional financing. No assurance can be given that additional financing will be available,
or if available, will be on terms acceptable to the Company. If adequate working capital is not available, the Company may not be able
continue its operations.
NOTE 3 – Summary of Significant Accounting
Policies
Use of Estimates
The preparation of consolidated financial statements
in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date
of the consolidated financial statements and the amount of revenues and expenses during the reporting periods. Management makes these
estimates using the best information available at the time the estimates are made. However, actual results could differ materially from
those results. Significant accounting estimates reflected in the Company’s consolidated financial statements included the valuation
of accounts receivable, the estimated useful lives of long-term assets, the valuation of short-term investment and the valuation of deferred
tax assets.
Cash and cash equivalents
Cash and cash equivalents include cash on hand and
deposits placed with banks or other financial institutions, which are unrestricted as to withdrawal and use and with an original maturity
of three months or less. The Company maintains its cash in bank deposit accounts. Cash accounts are guaranteed by the Federal Deposit
Insurance Corporation up to $250,000. The Company has not experienced any losses in such accounts and believes it is not exposed to any
significant credit risk on such cash.
Accounts Receivable and Allowance for Doubtful
Accounts
Accounts receivable are recorded at the invoiced amount,
net of an allowance for doubtful accounts. The Company follows paragraph 310-10-50-9 of the FASB Accounting Standards Codification to
estimate the allowance for doubtful accounts. The Company performs on-going credit evaluations of its customers and adjusts credit limits
based upon payment history and the customer’s current credit worthiness, as determined by the review of their current credit information;
and determines the allowance for doubtful accounts based on historical write-off experience, customer specific facts and economic conditions.
Outstanding account balances are reviewed individually
for collectability. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in
the Company’s existing accounts receivable. Bad debt expense is included in general and administrative expenses, if any. Pursuant
to paragraph 310-10-50-2 of the FASB Accounting Standards Codification account balances are charged off against the allowance after all
means of collection have been exhausted and the potential for recovery is considered remote. The Company has adopted paragraph 310-10-50-6
of the FASB Accounting Standards Codification and determine when receivables are past due or delinquent based on how recently payments
have been received.
Revenue Recognition
The Company’s revenue recognition policies are
in compliance with ASC 605 (Originally issued as Staff Accounting Bulletin (SAB) 104). Revenue is recognized at the date of shipment to
customers when a formal arrangement exists, the price is fixed or determinable, the delivery is completed, no other significant obligations
of the Company exist, and collectability is reasonably assured. Payments received before all of the relevant criteria for revenue recognition
are satisfied are recorded as unearned revenue. Discounts provided to customers by the Company at the time of sale are
recognized as a reduction in sales as the products are sold. Sales taxes are not recorded as a component of sales.
The Company derives its revenues from sales contracts
with customers with revenues being generated upon the shipment of merchandise. Persuasive evidence of an arrangement is demonstrated via
sales invoice or contract; product delivery is evidenced by warehouse shipping log as well as a signed acknowledgement of receipt from
the customers or a signed bill of lading from the third party trucking company and title transfers upon shipment, based on free on board
(“FOB”) warehouse terms; the sales price to the customer is fixed upon acceptance of the signed purchase order or contract
and there is no separate sales rebate, discount, or volume incentive. When the Company recognizes revenue, no provisions are made for
returns because, historically, there have been very few sales returns and adjustments that have impacted the ultimate collection of revenues.
Net sales of products represent the
invoiced value of goods, net of value added taxes (“VAT”). The Company is subject to VAT which is levied on all of the Company’s
products at the rate of 5% on the invoiced value of sales. Sales or Output VAT is borne by customers in addition to the invoiced value
of sales and Purchase or Input VAT is borne by the Company in addition to the invoiced value of purchases to the extent not refunded for
export sales.
Property and Equipment
Property and equipment are stated at cost, less accumulated
depreciation and amortization. Property and equipment are depreciated using the straight-line method over the estimated useful lives of
the assets. Leasehold and tenant improvements are amortized over the shorter of the lease term or the estimated useful lives of the assets.
The Company periodically reviews assets’ estimated useful lives based upon actual experience and expected future utilization. A
change in useful life is treated as a change in accounting estimate and is applied prospectively.
Upon retirement or disposition of property
and equipment, the cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is reflected in selling,
general and administrative expenses for that period. Major additions and betterments are capitalized to the asset accounts while maintenance
and repairs, which do not improve or extend the lives of assets, are expensed as incurred.
Investments in Non-Consolidated Entities
Investments in non-consolidated entities
are accounted for using the equity method or cost basis depending upon the level of ownership and/or the Company's ability to exercise
significant influence over the operating and financial policies of the investee. When the equity method is used, investments are recorded
at original cost and adjusted periodically to recognize the Company's proportionate share of the investees' net income or losses after
the date of investment. When net losses from an investment are accounted for under the equity method exceed its carrying amount, the investment
balance is reduced to zero and additional losses are not provided for. The Company resumes accounting for the investment under the equity
method if the entity subsequently reports net income and the Company's share of that net income exceeds the share of net losses not recognized
during the period the equity method was suspended. Investments are written down only when there is clear evidence that a decline in value
that is other than temporary has occurred.
Income Taxes
The Company accounts for income taxes in accordance
with ASC 740, Income Taxes, which requires that the Company recognize deferred tax liabilities and assets based on the differences
between the financial statement carrying amounts and the tax basis of assets and liabilities, using enacted tax rates in effect in the
years the differences are expected to reverse. Deferred income tax benefit (expense) results from the change in net deferred tax assets
or deferred tax liabilities. A valuation allowance is recorded when, in the opinion of management, it is more likely than not that some
or all of any deferred tax assets will not be realized.
The Company adopted ASC 740-10-25, Income Taxes- Overall-Recognition,
on January 1, 2007, which provides criteria for the recognition, measurement, presentation and disclosure of uncertain tax position. The
Company must recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be
sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the
financial statements from such a position are measured based on the largest benefit that has a greater than 50% likelihood of being realized
upon ultimate resolution. The Company did not recognize any additional liabilities for uncertain tax positions as a result of the implementation
of ASC 740-10-25.
Earnings per Share
The Company calculates its basic and diluted earnings
per share in accordance with ASC 260. Basic earnings per share are calculated by dividing net income by the weighted average number of
common shares outstanding for the period. Diluted earnings per share are calculated by adjusting the weighted average outstanding shares
to assume conversion. For the nine months ended September 30, 2022 and 2021, the difference between numbers of basic and diluted shares
of common stock is due to effect of convertible promissory note.
Recently Issued Accounting Pronouncements
The SEC has provided in the Bulletin that in situations
where the accounting is incomplete for certain effects of the Tax Act, a measurement period which begins in the reporting period that
includes the enactment of the Tax Act and ends when the entity has obtained, prepared and analyzed the information is needed in order
to complete the accounting requirements. The measurement period shall not exceed one year from enactment.
In February 2018, the FASB issued ASU 2018-02, “Income
Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income,”
which allows a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from
the Tax Cuts and Jobs Act. This guidance is effective for all entities for fiscal years, and interim periods within those years, beginning
after December 15, 2018, with early adoption permitted. The amendments in ASU 2018-02 should be applied either in the period of adoption
or retrospectively to each period in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Cuts and
Jobs Act is recognized. The adoption of this guidance is not expected to have a material impact on the Company's Financial Statements
and related disclosures.
Management does not believe that any recently issued,
but not yet effective accounting pronouncements, when adopted, will have a material effect on the accompanying financial statements.
NOTE 4 – Loan Receivable
There was no loan receivable made during
the period.
NOTE 5 – Convertible Promissory Note
There was no convertible promissory note made during
the period.
NOTE 6 – Income Taxes
The Company did not provide any current or deferred
U.S. federal income tax provision or benefit for any of the periods presented because the Company has experienced operating losses for
U.S. federal income tax purposes since inception. When it is more likely than not that the deferred tax asset cannot be realized through
future income the Company must set up allowance for this future tax benefit. As of September
30, 2022, the Company had approximately $1.7 million net operating loss carryforward available in the U.S. from continuing operation
to reduce future taxable income. The Company set up 100% valuation allowance for deferred tax assets resulting from net operating
loss carryforward.
The U.S. Tax Cuts and Jobs Act (the "Act")
was enacted on December 22, 2017 and introduces significant changes to U.S. income tax law. Effective in 2018, the Tax Act reduces the
U.S. statutory tax rate from 35% to 21% and creates new taxes on certain foreign-sourced earnings and certain related-party payments,
which are referred to as the global intangible low-taxed income tax and the base erosion tax, respectively. The Company's deferred tax
assets were remeasured to reflect the reduction in the U.S. corporate income tax rate from 35% to 21%, resulting in a change of deferred
tax assets of $142,650 for the year ended December 31, 2017. This amount can be seen on the rate reconciliation as an adjustment to deferred
tax asset and corresponding valuation allowance.
A reconciliation of the provision for income taxes
to the Company’s effective income tax rate for is as follows:
| | |
| |
|
| | |
Nine Months Ended
September 30, |
| | |
2022 | |
2021 |
| Pre-tax income(loss) | |
$ | 37,054 | | |
$ | 12,435 | |
| U.S. federal corporate income tax rate | |
| 21 | % | |
| 21 | % |
| Expected U.S. income tax expense(credit) | |
| 7,781 | | |
| 2,611 | |
| Change of valuation allowance | |
| (7,781 | ) | |
| (2,611 | ) |
| Effective tax expense | |
$ | — | | |
$ | — | |
NOTE 7 –SUBSEQUENT EVENTS
The Company has evaluated the existence of
significant events subsequent to the balance sheet date through the date the financial statements were issued and has determined that
there were no subsequent events or transactions which would require recognition or disclosure in the financial statements.
ITEM 8 - MANAGEMENT’S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
This Quarterly Report
contains forward-looking statements within the meaning of the federal securities laws. These include statements about our expectations,
beliefs, intentions or strategies for the future, which we indicate by words or phrases such as "anticipate," "expect,"
"intend," "plan," "will," "we believe," "management believes" and similar language.
The forward-looking statements are based on the current expectations of the Company and are subject to certain risks, uncertainties and
assumptions, including those set forth in the discussion under "Management's Discussion and Analysis of Financial Condition and
Results of Operations" in this report. Actual results may differ materially from results anticipated in these forward-looking statements.
We base the forward-looking statements on information currently available to us, and we assume no obligation to update them.
Investors are also advised
to refer to the information in our previous filings with the Securities and Exchange Commission (SEC), especially on Forms 10-K, 10-Q
and 8-K, in which we discuss in more detail various important factors that could cause actual results to differ from expected or historic
results. It is not possible to foresee or identify all such factors. As such, investors should not consider any list of such factors
to be an exhaustive statement of all risks and uncertainties or potentially inaccurate assumptions.
Overview
From
2018 to 2021, the Company focused in products and services that adopt IoT, cloud computing, mobile payments, Big Data, Blockchain
and AI, and other new and exciting business models that will create revolutionary products and services. On 2020 to 2021, the Company
has signed a total of USD90,000 Note agreements with Sinoway International Corp. (“Sinoway”). This is in connection with
the new business venture between the Company and Sinoway relating to various technology platform development. In 2022, Sinoway has changed
its registered company name to Beneway Holdings Group. Beneway Holdings Group Ltd.
is a global integrated supply chain management platform, providing innovative fintech solutions and a large-scale distribution network
to facilitate growth & funding for businesses. Operating through a novel cloud-based POS API platform that allows for the integration
of resources across numerous supply chain marketplaces, Beneway’s core objective is to connect various financial service providers
(e.g., digital wallets, electronic cards, P2P lenders, payment gateways and cross-border payments providers) with merchants/borrowers
who can efficiently synergize together to maximize products, services, and consumer demands. With the robust financing services and tailored
marketing plans, Beneway looks to create substantial value and growth for businesses and stakeholders through progressively constructuing
a deep customer base and leveraging on the power of economies of scale. Learn more about Beneway Holdings Group at their website www.benewaygroup.com
On
August 7, 2021, the Company has acquired 49% of the registered shares of Midas Touch Technology Co. Ltd., a digital asset management
platform registered in the U.K (company number 13088810), which was founded in 2020.
On
November 4, 2021, the Company signed a joint venture and partnered with Maninderpal Bhullar and Simon Eeu Yin How as directors of Beneway
(MY) Sdn. Bhd., the joint venture company. Subsequently on November 21, 2021, the Company registered the joint venture company named
Beneway (MY) Sdn. Bhd. in which the company owns 35% of the shares.
The Company is working
new businesses in various fields through careful review and critical selection of new growth businesses. The Company is working to strengthen
our core competencies in high technology and blockchain related businesses, such as blockchain apps technology, fintech services, professional
consultancy for ICO’s, and other high potential critical blockchain projects.
Results of Operations
Three and Nine Months ended September 30, 2022
and 2021.
Revenue
The Company recognized $45,000 and $106,000 of
revenue during the three months ended September 30, 2022 and 2021, and $176,000 and $204,000 of revenue during nine months ended
September 30, 2022 and 2021 respectively. Our revenues were generated from the I.T. management consulting services.
General and Administrative Expenses:
General and administrative expenses were $11,701 and
$62,585 for the three months ended September 30, 2022 and 2021, and $142,234 and $190,793 for the nine months ended September 30, 2022
and 2021, respectively. The increase was primarily due to office expenses and professional expenses.
Interest expense
During the three months ended September 30, 2022 and
2021, the Company had interest expense of $4,953 and $4,475 and during the nine months ended September 30, 2022 and 2021, the company
had interest expenses of $14,778 and $13,524, from convertible promissory note respectively.
Net income
As a result of the foregoing, the Company generated
net income (loss) of $31,167 and $49,574 for the three months ended September 30, 2022 and 2021, and $37,054 and $12,435 for the nine
months ended September 30, 2022 and 2021 respectively.
Liquidity and Capital Resources
We have funded our operations to date primarily through
operations, and non-related party loans and capital contributions. Due to our net loss and negative cash flow from operating activities,
there is substantial doubt about the Company’s ability to continue as a going concern. The Company’s management recognizes
that the Company must generate sales and obtain additional financial resources to continue to develop its operations
As of September 30, 2022, we had a working capital
deficit of $19,114. Our current assets on September 30, 2022 were $427,174 primarily consisting of cash of $14,649, accounts receivable
of $382,525 and Short Term Investment- Held-for-Trading in iDrink Technology Co. Ltd. $30,000. Other assets include loans receivable of
$50,000, other receivables- Income from HFT $9,000, other interest receivables -Sinoway International $6,068, and other receivables- others
$144,626. Our current liabilities were primarily composed of credit card payable of $2,784, convertible promissory notes of $287,000,
short term debt of $172,734 and accrued expenses and other liabilities of $193,625.
Cash Flow from Operating Activities
Net cash provided/ used in operating activities was
$15,201during the nine months ended September 30, 2022 which consisted of our net income of $37,054 offset by the changes in other receivable
$12,974, accounts receivable $43,500, interest receivables -Sinoway International $3,366, a change of accrued expenses of $6,991, and
a change of credit card payable of $556.
Net cash provided/ used in operating activities was
$61,187 during the nine months ended September 30, 2021 which consisted of our net income of $12,435 offset by the changes in other receivable
$77,520 accounts receivable $64,025, interest receivables -Sinoway International $1,441, a change of accrued expenses of $57,490, and
a change of credit card payable of $11,836.
Cash Flow from Investing
Activities
Net cash used in investing activities totaled $0 for the nine
months ended September 30, 2020.
Net cash used in investing activities totaled $0 for the nine
months ended September 30, 2021.
Cash Flow from Financing
Activities
Net cash provided by financing activities
totaled $0 of proceeds from non-related party for the nine months ended September 30, 2022.
Net cash provided by financing activities
totaled $90,000 of proceeds from non-related party for the nine months ended September 30, 2021.
Off-Balance Sheet Arrangements
There are no off-balance sheet arrangements that have
or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues, expenses,
results of operations, liquidity, capital expenditures or capital resources.
Inflation
We do not believe our business and operations
have been materially affected by inflation
Critical Accounting Policies and Estimates
This discussion and analysis of our financial condition
and results of operations are based on our financial statements that have been prepared under accounting principle generally accepted
in the United States of America. The preparation of financial statements in conformity with accounting principles generally accepted in
the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities
and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those estimates.
A summary of significant accounting policies is included
in Note 3 to the consolidated financial statements included in this Annual Report. Of these policies, we believe that the following items
are the most critical in preparing our financial statements.
Accounts Receivable and Allowance for Doubtful
Accounts
Accounts receivable are recorded at the invoiced amount,
net of an allowance for doubtful accounts. The Company follows paragraph 310-10-50-9 of the FASB Accounting Standards Codification to
estimate the allowance for doubtful accounts. The Company performs on-going credit evaluations of its customers and adjusts credit limits
based upon payment history and the customer’s current credit worthiness, as determined by the review of their current credit information;
and determines the allowance for doubtful accounts based on historical write-off experience, customer specific facts and economic conditions.
Outstanding account balances are reviewed individually
for collectability. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in
the Company’s existing accounts receivable. Bad debt expense is included in general and administrative expenses, if any. Pursuant
to paragraph 310-10-50-2 of the FASB Accounting Standards Codification account balances are charged off against the allowance after all
means of collection have been exhausted and the potential for recovery is considered remote. The Company has adopted paragraph 310-10-50-6
of the FASB Accounting Standards Codification and determine when receivables are past due or delinquent based on how recently payments
have been received.
Inventories
Inventories consists of products purchased and are
valued at the lower of cost or net realizable value. Cost is determined on the weighted average cost method. The Company reduces inventories
for the diminution of value, resulting from product obsolescence, damage or other issues affecting marketability, equal to the difference
between the cost of the inventory and its estimated net realizable value. Factors utilized in the determination of estimated net realizable
value include (i) current sales data and historical return rates, (ii) estimates of future demand, (iii) competitive pricing pressures,
(iv) new product introductions, (v) product expiration dates, and (vi) component and packaging obsolescence.
The Company evaluates its current level of inventories
considering historical sales and other factors and, based on this evaluation, classify inventory markdowns in the income statement as
a component of cost of goods sold pursuant to Paragraph 420-10-S99 of the FASB Accounting Standards Codification to adjust inventories
to net realizable value. These markdowns are estimates, which could vary significantly from actual requirements if future economic conditions,
customer demand or competition differ from expectations.
Revenue Recognition
The Company’s revenue recognition policies are
in compliance with ASC 605 (Originally issued as Staff Accounting Bulletin (SAB) 104). Revenue is recognized at the date of shipment to
customers when a formal arrangement exists, the price is fixed or determinable, the delivery is completed, no other significant obligations
of the Company exist and collectability is reasonably assured. Payments received before all of the relevant criteria for revenue recognition
are satisfied are recorded as unearned revenue. Discounts provided to customers by the Company at the time of sale are
recognized as a reduction in sales as the products are sold. Sales taxes are not recorded as a component of sales.
The Company derives its revenues from sales contracts
with customers with revenues being generated upon the shipment of merchandise. Persuasive evidence of an arrangement is demonstrated via
sales invoice or contract; product delivery is evidenced by warehouse shipping log as well as a signed acknowledgement of receipt from
the customers or a signed bill of lading from the third party trucking company and title transfers upon shipment, based on free on board
(“FOB”) warehouse terms; the sales price to the customer is fixed upon acceptance of the signed purchase order or contract
and there is no separate sales rebate, discount, or volume incentive. When the Company recognizes revenue, no provisions are made for
returns because, historically, there have been very few sales returns and adjustments that have impacted the ultimate collection of revenues.
Net sales of products represent the invoiced value
of goods, net of value added taxes (“VAT”). The Company is subject to VAT which is levied on all of the Company’s products
at the rate of 5% on the invoiced value of sales. Sales or Output VAT is borne by customers in addition to the invoiced value of sales
and Purchase or Input VAT is borne by the Company in addition to the invoiced value of purchases to the extent not refunded for export
sales.
Foreign Currency Translation
The Company follows Section 830-10-45 of the FASB
Accounting Standards Codification (“Section 830-10-45”) for foreign currency translation to translate the financial statements
of the foreign subsidiary from the functional currency, generally the local currency, into U.S. Dollars. Section 830-10-45 sets out the
guidance relating to how a reporting entity determines the functional currency of a foreign entity (including of a foreign entity in a
highly inflationary economy), re-measures the books of record (if necessary), and characterizes transaction gains and losses. the assets,
liabilities, and operations of a foreign entity shall be measured using the functional currency of that entity. An entity’s functional
currency is the currency of the primary economic environment in which the entity operates; normally, that is the currency of the environment,
or local currency, in which an entity primarily generates and expends cash.
The functional currency of each foreign subsidiary
is determined based on management’s judgment and involves consideration of all relevant economic facts and circumstances affecting
the subsidiary. Generally, the currency in which the subsidiary transacts a majority of its transactions, including billings, financing,
payroll and other expenditures, would be considered the functional currency, but any dependency upon the parent and the nature of the
subsidiary’s operations must also be considered. If a subsidiary’s functional currency is deemed to be the local currency,
then any gain or loss associated with the translation of that subsidiary’s financial statements is included in accumulated other
comprehensive income. However, if the functional currency is deemed to be the U.S. Dollar, then any gain or loss associated with the
re-measurement of these financial statements from the local currency to the functional currency would be included in the consolidated
statements of comprehensive income (loss). If the Company disposes of foreign subsidiaries, then any cumulative translation gains or
losses would be recorded into the consolidated statements of comprehensive income (loss). If the Company determines that there has been
a change in the functional currency of a subsidiary to the U.S. Dollar, any translation gains or losses arising after the date of change
would be included within the statement of comprehensive income (loss). Based on an assessment of the factors discussed above, the management
of the Company determined the relevant subsidiaries’ local currencies to be their respective functional currencies.
PART
II — OTHER INFORMATION
Item 1. Legal Proceedings.
To the best knowledge of the officers and directors,
the Company was not a party to any legal proceeding or litigation as of September 30, 2022.
Item 2. Unregistered Sales of Equity Securities
and Use of Proceeds.
None.
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Mine Safety Disclosures
Not applicable.
Item 5. Other Information.
None.
Item 6. Exhibits.
| Exhibit
No. |
Description |
| 31.1 |
Chief
Executive Officer Certification of Periodic Financial Report Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
| 31.2 |
Chief
Financial Officer Certification of Periodic Financial Report Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
| 32.1 |
Chief
Executive Officer Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes Oxley Act
of 2002. |
| 32.2 |
Chief
Financial Officer Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes Oxley Act
of 2002 |
| 101 |
The
following materials from SUIC Worldwide Holdings Ltd.’s Quarterly Report on Form 10-Q for the period ended September
30, 2018 are formatted in eXtensible Business Reporting Language (XBRL): (i) the Consolidated Balance Sheet; (ii) the Consolidated
Statement of Comprehensive Income; (iii) the Consolidated Statements of Cash Flows, and (iv) Notes to Consolidated Financial Statements.
This Exhibit 101 is deemed not filed for purposes of Sections 11 or 12 of the Securities Act of 1933 and Section 18 of the Securities
Exchange Act of 1934, and otherwise is not subject to liability under these sections. |
SUIC Worldwide Holdings Ltd.
In accordance with the requirements of the Exchange Act, the
registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
SIGNATURES
Date: November 10, 2022.
By: /s/ Yanru Zhou
Yanru Zhou
Chief Executive Officer
Date: November 10, 2022.
By: /s/ Yanru Zhou
Yanru Zhou
Chief Finance Officer
17
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