Full Press Release Details
SUPERIOR LIVING SDN. BHD.
FINANCIAL STATEMENTS
ENDED DECEMBER 31, 2019 AND 2018
OF INDEPENDENT REGISTERED PUBLIC
SUPERIOR LIVING SDN. BHD.
TO CONSOLIDATED FINANCIAL STATEMENTS
| Consolidated Financial Statements | |
| Report of Independent Registered Public Accounting Firm | F-3 |
| Consolidated Balance Sheets as of December 31, 2019 and 2018 | F-4 |
| Consolidated Statements of Operations and Comprehensive Income (Loss) for the Years Ended December 31, 2019 and 2018 | F-5 |
| Consolidated Statements of Changes in Shareholders' Equity for the Years Ended December 31, 2019 and 2018 | F-6 |
| Consolidated Statements of Cash Flows for the Years Ended December 31, 2019 and 2018 | F-7 |
| Notes to Consolidated Financial Statements | F-8 - F-27 |
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
the Board of Directors and
of Agape Superior Living Sdn. Bhd.
on the Consolidated Financial Statements
have audited the accompanying consolidated balance sheets of Agape Superior Living Sdn. Bhd. (the "Company") as
of December 31, 2019 and 2018, and the related consolidated statements of operations and comprehensive income (loss), changes
in shareholders' equity and cash flows for each of the years in the two-year period ended December 31, 2019, and the
related notes (collectively referred to as the consolidated financial statements). In our opinion, the consolidated financial
statements present fairly, in all material respects, the financial position of the Company as of December 31, 2019 and 2018,
and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2019, in
conformity with accounting principles generally accepted in the United States of America.
consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an
opinion on the Company's consolidated financial statements based on our audits. We are a public accounting firm registered
with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws
and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits
to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether
due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over
financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting,
but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting.
Accordingly, we express no such opinion.
audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether
due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis,
evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the
accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the
consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
have served as the Company's auditor since 2019
SUPERIOR LIVING SDN. BHD.
| December 31, | ||||||||
| 2019 | 2018 | |||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash | $ | 1,030,829 | $ | 1,544,525 | ||||
| Other receivables | 34,672 | 48,507 | ||||||
| Other receivables - related parties | 233,942 | 115,225 | ||||||
| Inventories | 552,901 | 137,553 | ||||||
| Prepaid taxes | 1,181,963 | 188,198 | ||||||
| Prepayments and other assets | 484,880 | 468,850 | ||||||
| Prepayment - related party | - | 214,701 | ||||||
| Total current assets | 3,519,187 | 2,717,559 | ||||||
| Other assets | ||||||||
| Property and equipment, net | 364,604 | 429,620 | ||||||
| Intangible assets, net | 7,592 | 11,027 | ||||||
| Deferred tax assets, net | 234,797 | - | ||||||
| Total other assets | 606,993 | 440,647 | ||||||
| Total assets | $ | 4,126,180 | $ | 3,158,206 | ||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||
| Current liabilities | ||||||||
| Accounts payable - related party | $ | 520,786 | $ | - | ||||
| Customer deposits | 1,632,747 | 1,371,047 | ||||||
| Other payables and accrued liabilities | 252,902 | 968,547 | ||||||
| Other payables - related parties | 12,104 | 4,376 | ||||||
| Total current liabilities | 2,418,539 | 2,343,970 | ||||||
| Other liabilities | ||||||||
| Deferred tax liabilities | - | 18,901 | ||||||
| Total liabilities | 2,418,539 | 2,362,871 | ||||||
| Commitments and contingencies | ||||||||
| Shareholders' equity | ||||||||
| *Ordinary shares, no par value, 9,590,598 and 1,500,000 shares issued and outstanding as of December 31, 2019 and 2018, respectively | 2,372,008 | 394,737 | ||||||
| Retained earnings (accumulated deficit) | (740,004 | ) | 319,490 | |||||
| Accumulated other comprehensive income | 75,637 | 81,108 | ||||||
| Total shareholders' equity | 1,707,641 | 795,335 | ||||||
| Total liabilities and shareholders' equity | $ | 4,126,180 | $ | 3,158,206 |
to the New Companies Act 2016 effective from January 31, 2017, the concept of authorized share capital and par value has been
abolished, the Company is no longer required to state authorized share capital and par value.
accompanying notes are an integral part of these consolidated financial statements.
SUPERIOR LIVING SDN. BHD.
STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
| For the Years Ended | ||||||||
| December 31, | ||||||||
| 2019 | 2018 | |||||||
| Net revenues | $ | 4,139,359 | $ | 14,393,762 | ||||
| Cost of revenues | 857,250 | 2,391,597 | ||||||
| Gross profit | 3,282,109 | 12,002,165 | ||||||
| Operating expenses | ||||||||
| Selling expenses | 1,759,136 | 1,339,754 | ||||||
| Commission expenses | 1,611,172 | 7,045,419 | ||||||
| General and administrative expenses | 1,307,715 | 1,083,717 | ||||||
| Total operating expenses | 4,678,023 | 9,468,890 | ||||||
| Income (loss) from operations | (1,395,914 | ) | 2,533,275 | |||||
| Other income | ||||||||
| Interest income | 4,021 | 8,904 | ||||||
| Other income, net | 20,175 | 37,280 | ||||||
| Total other income, net | 24,196 | 46,184 | ||||||
| Income (loss) before income taxes | (1,371,718 | ) | 2,579,459 | |||||
| Provision for (benefits of) income taxes | (312,224 | ) | 597,548 | |||||
| Net income (loss) | (1,059,494 | ) | 1,981,911 | |||||
| Foreign currency translation adjustment | (5,471 | ) | 2,460 | |||||
| Comprehensive income (loss) | $ | (1,064,965 | ) | $ | 1,984,371 | |||
| (Loss) earnings per share | ||||||||
| Basic and diluted | $ | (0.57 | ) | $ | 1.32 | |||
| Weighted average number of ordinary shares outstanding | ||||||||
| Basic and diluted | 1,854,656 | 1,500,000 |
accompanying notes are an integral part of these consolidated financial statements.
SUPERIOR LIVING SDN. BHD.
STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
| Retained | Accumulated | |||||||||||||||||||
| Ordinary Shares | Earnings | Other | ||||||||||||||||||
| Shares | Share Capital | (Accumulated Deficit) | Comprehensive Income | Total | ||||||||||||||||
| Balance, December 31, 2017 | 1,500,000 | $ | 394,737 | $ | 1,630,045 | $ | 78,648 | $ | 2,103,430 | |||||||||||
| Dividend distributions | - | - | (3,292,466 | ) | - | (3,292,466 | ) | |||||||||||||
| Net income | - | - | 1,981,911 | - | 1,981,911 | |||||||||||||||
| Foreign currency translation adjustment | - | - | - | 2,460 | 2,460 | |||||||||||||||
| Balance, December 31, 2018 | 1,500,000 | 394,737 | 319,490 | 81,108 | 795,335 | |||||||||||||||
| Net loss | - | - | (1,059,494 | ) | - | (1,059,494 | ) | |||||||||||||
| Capital contributions by a shareholder | 8,090,598 | 1,977,271 | - | - | 1,977,271 | |||||||||||||||
| Foreign currency translation adjustment | - | - | - | (5,471 | ) | (5,471 | ) | |||||||||||||
| Balance, December 31, 2019 | 9,590,598 | $ | 2,372,008 | $ | (740,004 | ) | $ | 75,637 | $ | 1,707,641 |
accompanying notes are an integral part of these consolidated financial statements.
SUPERIOR LIVING SDN. BHD.
STATEMENTS OF CASH FLOWS
| For the Years Ended | ||||||||
| December 31, | ||||||||
| 2019 | 2018 | |||||||
| Cash flows from operating activities | ||||||||
| Net (loss) income | $ | (1,059,494 | ) | $ | 1,981,911 | |||
| Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities | ||||||||
| Depreciation | 74,702 | 28,715 | ||||||
| Amortization | 6,077 | 5,709 | ||||||
| Deferred taxes (benefit) provision | (250,822 | ) | 16,814 | |||||
| Change in operating assets and liabilities | ||||||||
| Other receivables | 14,116 | (49,702 | ) | |||||
| Inventories | (409,086 | ) | 988,613 | |||||
| Prepaid taxes | (980,082 | ) | (652,413 | ) | ||||
| Prepayments and other assets | (11,514 | ) | (332,774 | ) | ||||
| Prepayment - related party | 214,100 | (219,991 | ) | |||||
| Accounts payable - related party | 514,524 | (525,666 | ) | |||||
| Customer deposits | 245,909 | 1,052,787 | ||||||
| Commission payables | - | (1,039,008 | ) | |||||
| Other payables and accrued liabilities | (715,974 | ) | 393,937 | |||||
| Net cash (used in) provided by operating activities | (2,357,544 | ) | 1,648,932 | |||||
| Cash flows from investing activities | ||||||||
| Purchases of equipment | (6,502 | ) | (455,786 | ) | ||||
| Purchase of intangible assets | (2,582 | ) | (6,698 | ) | ||||
| Net cash used in investing activities | (9,084 | ) | (462,484 | ) | ||||
| Cash flows from financing activities | ||||||||
| Dividend distributions | - | (3,292,466 | ) | |||||
| (Loans to) repayments from related parties | (116,227 | ) | 652,919 | |||||
| Loans from related parties | 1,961,091 | 807 | ||||||
| Net cash provided by (used in) financing activities | 1,844,864 | (2,638,740 | ) | |||||
| Effect of exchange rate on cash | 8,068 | (13,003 | ) | |||||
| Net change in cash | (513,696 | ) | (1,465,295 | ) | ||||
| Cash, beginning of year | 1,544,525 | 3,009,820 | ||||||
| Cash, end of year | $ | 1,030,829 | $ | 1,544,525 | ||||
| Supplemental cash flows information | ||||||||
| Income taxes paid | $ | 995,494 | $ | 1,047,473 | ||||
| Non-cash transactions of investing and financing activities | ||||||||
| Capital contributions from a shareholder loan for additional shares issued | $ | 1,977,271 | $ | - |
accompanying notes are an integral part of these consolidated financial statements.
SUPERIOR LIVING SDN. BHD.
TO CONSOLIDATED FINANCIAL STATEMENTS
Superior Living Sdn. Bhd. ("ASL" or the "Company") is a limited company incorporated on August 8, 2003,
under the laws of Malaysia.
Company engages in the direct selling marketing business in the Health and Wellness Industry. The principal activity of the Company
is to supply high-quality health and wellness products, including supplements to assist in cell metabolism, detoxification, blood
circulation, anti-aging and products designed to improve the overall health system in the body.
accompanying consolidated financial statements reflect the activities of ASL and Agape S.E.A. Sdn. Bhd. ("SEA"), a
variable interest entity ("VIE") (See Note 3).
Superior Living Sdn. Bhd. is a network marketing company specializing in healthcare products and focusing on improving people's
health and wellbeing. The Company primarily focuses its efforts on customers in Malaysia.
Company's scientific team and medical advisors strongly believe that this is best done through creating easy access to a
nutrient rich food supply that can have a direct effect in improving the wellbeing of the individual, through providing nutrients
and vitamins no longer readily available.
herbal and vitamin supplements are packed with naturally occurring nutrients and minerals. When they are combined with a healthy
balanced diet, the body is really nourished, and improvements in strength, skin color, healing ability and cell rejuvenation often
Company is also helping people enjoy greater health and superior living' right now through the ATP Zeta Super Health
Program. Other award winning products have been selected to compliment the products that form the ATP Zeta Program. The ATP Zeta
Super Health Program consists of twelve products. None of these products are owned or produced by the Company. In the event that
any of these products are no longer produced, or are otherwise unavailable, the Company may have to devote significant effort
to identifying and obtaining comparable replacement products. The twelve products that comprise the ATP Zeta Super Health Program
are ATP1s Survivor Select, ATP2 Energized Mineral Concentrate, ATP3 Ionized Cal-Mag, ATP4 Omega Blend, ATP5 BetaMaxx, AGN-Vege
Fruit Fiber, AGP1-Iron, YFA-Young Formula, Mitogize, ORYC-Organic Youth Care Cleansing Bar, No.1 MED and Trim+.
accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted
in the United States of America ("U.S. GAAP") pursuant to the rules and regulations of the SEC.
SUPERIOR LIVING SDN. BHD.
TO CONSOLIDATED FINANCIAL STATEMENTS
consolidated financial statements include the financial statements of the Company and its VIE. All transactions and balances among
the Company and its subsidiaries have been eliminated upon consolidation.
of Estimates and Assumptions
preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date
of the consolidated financial statements and the reported amounts of revenues and expenses during the periods presented. Significant
accounting estimates reflected in the Company's consolidated financial statements include allowance for doubtful accounts,
allowance for inventories obsolescence, useful lives of plant and equipment, impairment of long-lived assets, and allowance for
deferred tax assets and uncertain tax position. Actual results could differ from these estimates.
accounting standard regarding fair value of financial instruments and related fair value measurements defines financial instruments
and requires disclosure of the fair value of financial instruments held by the Company.
accounting standards define fair value, establish a three-level valuation hierarchy for disclosures of fair value measurement
and enhance disclosure requirements for fair value measures.
three levels are defined as follow:
| 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, and inputs that are observable for the assets or liability, either directly or indirectly, for substantially the full term of the financial instruments. | ||
| Level 3 inputs to the valuation methodology are unobservable and significant to the fair value. |
instruments included in current assets and current liabilities are reported in the consolidated balance sheets at face value or
cost, which approximate fair value because of the short period of time between the origination of such instruments and their expected
realization and their current market rates of interest.
Currency Translation and Transaction
reporting currency of the Company is the U.S. dollar. The Company in Malaysia conducts its businesses in the local currency, Ringgit
Malaysia (RM), as its functional currency. Assets and liabilities are translated at the unified exchange rate as quoted by the
Federal Reserve at the end of the period. The statement of income accounts are translated at the average translation rates and