NOTES
TO THE UNAUDITED FINANCIAL STATEMENTS
NOTE
1 – ORGANIZATION AND PRINCIPAL ACTIVITIES
Achison
Inc. (the “Company”) was incorporated under the laws of the State of New York on December 29, 2014.
On
July 1, 2019, Lansdale Inc, the principal stockholder of the Company (“Seller”) and controlled by the Company’s prior
President, Mr. Wanjun Xie, entered into a Stock Purchase Agreement (the “Agreement”) with Dazhong 368 Inc, (the “Buyer”),
pursuant to which, a total of 9,000,000 shares of Class A common stock of the Company were transferred to the Buyer, representing approximately
90% of the Company’s issued and outstanding shares of Class A common stock, resulting in a change of the control of the Company.
Mr. Dingshan Zhang was appointed as the President and CEO of the Company at the same date.
Prior
to July of 2019 the Company primarily engaged in trading spot gold and silver in Singapore Markets, crypto currency and US equity stocks.
The Company currently engages only in internet advertising through www.dazhong368.com (the “Website”) in the New York area
and has plans to seek other profitable business at the same time.
NOTE
2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis
of Presentation
In
the opinion of management, the unaudited interim condensed financial statements reflect all adjustments of a normal recurring nature
that are necessary for a fair presentation of the results for the interim periods presented. However, the results of operations included
in such financial statements may not necessary be indicative of annual results.
The
Company uses the same accounting policies in preparing quarterly and annual financial statements. Certain information and footnote disclosures
normally included in the annual financial statements prepared in accordance with accounting principles generally accepted in the United
States of America (“U.S. GAAP”) have been condensed or omitted. These unaudited condensed financial statements should be
read in conjunction with the Company’s audited financial statements and notes thereto included in the Company’s Annual Report
on Form 10-K for the year ended March 31, 2022 filed with the Securities and Exchange Commission (“SEC”) on June 28, 2022
(“2021 Form 10-K.”)
Use
of Estimates
The
accompanying financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”)
and the rules and regulations of the Securities and Exchange Commission (the “SEC”).
The
preparation of the Company’s financial statements in conformity with GAAP requires management to make estimates, judgments and
assumptions that affect the amounts reported in the financial statements and footnotes thereto. Actual results may differ from those
estimates and assumptions.
Revenue
Recognition
Revenue
is recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration
we expect to be entitled to in exchange for those goods or services. The Company determines revenue recognition by applying the following
steps: 1) identification of the contract, or contracts, with a customer; 2) identification of the performance obligations in the contract;
3) determination of the transaction price; 4) allocation of the transaction price to the performance obligations in the contract; and
5) recognition of revenue when, or as, we satisfy a performance obligation.
Advertising
revenue is generated by displaying advertising products on the Website. The Company recognizes revenue from the display of impression-based
advertisements in the contracted period in which the impressions are delivered. Impressions are considered delivered when an advertisement
is displayed to users. In general, the Company presents advertising revenue on a gross basis, since the Company controls the advertising
inventory before it is transferred to its customers. Control of advertisement inventory is evidenced by the Company’s sole ability
to monetize the advertising inventory before it is transferred to our customers. Pricing for our services is generally a fixed amount
and is typically due within 30 days upon signing the contract with customers. Unsatisfied performance obligations under advertising contracts
are recorded as contract liabilities.
Accounting
Standards Issued but Not Yet Adopted
Credit
Losses
In
June 2016, the FASB issued ASU No. 2016-13, (Topic 326), Financial Instruments – Credit Losses: Measurement of Credit Losses on
Financial Instruments which amends the current accounting guidance and requires the use of the new forward-looking “expected loss”
model, rather than the “incurred loss” model, which requires all expected losses to be determined based on historical experience,
current conditions and reasonable and supportable forecasts. This guidance amends the accounting for credit losses for most financial
assets and certain other instruments including trade and other receivables, held-to-maturity debt securities, loans and other instruments.
In
November 2019, the FASB issued ASU No. 2019-10 to postpone the effective date of ASU No. 2016-13 for public business entities eligible
to be smaller reporting companies (SRCs) as defined by the SEC. ASU No. 2016-13 is effective for SRCs for fiscal years beginning after
December 15, 2022, including interim periods within those fiscal years. The Company is evaluating the impact of the adoption of ASU 2016-13
on its financial position and results of operations.
There
were other updates recently issued. The management does not believe that other than disclosed above, accounting pronouncements the recently
issued but not yet adopted will have a material impact on its financial position results of operations or cash flows.
NOTE
3 – GOING CONCERN
The
Company’s financial statements have been prepared on a going concern basis, which contemplates the realization of assets and settlement
of liabilities and commitments in the normal course of business. During the three months ended June 30, 2022, the Company incurred a
net loss of $21,105. The Company had an accumulated deficit of $260,807 as of June 30, 2022 and negative working capital of $71,357.
These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern.
Management’s
plan to alleviate the substantial doubt about the Company’s ability to continue as a going concern include attempting to improve
its business profitability, its ability to generate sufficient cash flow from its operations to meet its operating needs on a timely
basis, obtain additional working capital funds from the majority shareholder and President of the Company to eliminate inefficiencies
in order to meet its anticipated cash requirements. However, there can be no assurance that these plans and arrangements will be sufficient
to fund the Company’s ongoing capital expenditures and other requirements.
The
financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts
and classification of liabilities that might be necessary in the event that the Company cannot continue as a going concern.
NOTE
4 – RELATED PARTY TRANSACTIONS
Lease
The
Company has been provided office space by its President at no cost. The management determined that such cost is immaterial and did not
recognize the rent expense in its financial statements.
Loan
In
August 2019, the Company borrowed $71,000
from the President of the Company, which bears no interest with a maturity in December
2021. During the year ended March 31, 2022, the Company repaid $17,000
to the President of the Company after the Company
borrowed $5,000 in May 2021. On December 29, 2021, the Company and our President entered into the first amendment to extend the maturity
date to December
31, 2022.
In
June 2022, the Company borrowed $2,000 from the President of the Company, which bears no interest with a same maturity date at December 31, 2022. As of June 30, 2022 and March 31, 2022, the outstanding balance of shareholder loan was $61,000 and $59,000, respectively.
NOTE
5 – INCOME TAX
The
Company has not recognized an income tax benefit for its operating losses generated based on uncertainties concerning its ability to
generate taxable income in future periods. The tax benefit for the period presented is offset by a valuation allowance established against
deferred tax assets arising from the net operating losses, the realization of which could not be considered more likely than not. In
future periods, tax benefits and related deferred tax assets will be recognized when management considers realization of such amounts
to be more likely than not.
For
the three months ended June 30, 2022 and March 31, 2022, the Company has incurred a net loss before tax of $ and $, respectively.
Net operation losses (“NOLs”) can be carried forever based on the 2017 Tax Cuts and Jobs Act. As of June 30, 2022 and March
31, 2022, deferred tax assets resulted from NOLs of approximately $31,323 and $11,945, which was fully off-set by valuation allowance
reserved.
NOTE
6 – SUBSEQUENT EVENTS
The
Company evaluated all events or transactions that occurred after June 30, 2022 through the date the financial statements were available
to be issued. During the period, the Company did not have any material recognizable subsequent events required to be disclosed or adjusted
as of and for the three months ended June 30, 2022.