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Concentrations and Credit Risk

6 Months Ended

Mar. 31, 2016

Concentrations and Credit Risk [Text Block]

20.	Concentrations and Credit Risk

	(a)	Concentrations

		The Company had three and two customers that individually comprised 10% or more of net revenue for the three months ended March 31, 2015 and 2016, respectively, as follows:

		Three months ended March 31,
		2015						2016
Shenzhen Dibike Electronics Technology Co., Ltd	$	819,523			26.72%		$	*			*
Guangdong Pisen Electronics Co., Ltd.		810,096			26.41%			*			*
Sichuan Pisen Electronics Co., Ltd		536,857			17.50%			*			*
Shandong Tangjun Electric Co., Ltd		*			*			1,362,787			42.60%
Pingxiang Anyuan Tourist Bus Co., Ltd	$	*			*		$	1,265,844			39.57%

* Comprised less than 10% of net revenue for the respective period.

The Company had three and two customers that individually comprised 10% or more of net revenue for the six months ended March 31, 2015 and 2016, respectively, as follows:

		Six months ended March 31,
		2015						2016
Guangdong Pisen Electronics Co., Ltd.	$	2,189,722			35.63%		$	*			*
Sichuan Pisen Electronics Co., Ltd		1,976,898			32.17%			*			*
Shenzhen Dibike Electronics Technology Co., Ltd		819,523			13.34%			*			*
Shandong Tangjun Electric Co., Ltd		*			*			3,799,258			43.67%
Pingxiang Anyuan Tourist Bus Co., Ltd	$	*			*		$	2,468,130			28.37%

The Company had two and two customers that individually comprised 10% or more of accounts receivable as of September 30, 2015 and March 31, 2016, respectively, as follows:

		September 30, 2015						March 31, 2016

Sichuan Pisen Electronics Co., Ltd.	$	3,146,177			65.93%		$	*			*
Guangdong Pisen Electronics Co., Ltd		763,738			16.01%			*			*
Shandong Tangjun Electric Co., Ltd		*			*			3,296,818			47.43%
Pingxiang Anyuan Tourist Bus Co., Ltd	$	*			*		$	2,708,893			38.97%

* Comprised less than 10% of accounts receivable for the respective period.

For the three and six months ended March 31, 2015 and 2016, the Company recorded the following transactions with the former subsidiaries as follows:

		Three months ended March 31,						Six months ended March 31,
		2015			2016			2015			2016
Purchase of inventories from
BAK Tianjin	$	1,824,814		$	140,400		$	3,559,757		$	3,185,306
Shenzhen BAK		-			11,888			-			17,231

Sales to
BAK Tianjin		58,488			27,007			58,488			368,237
Shenzhen BAK	$	43,208		$	215,178		$	64,650		$	827,517

	(b)	Credit Risk

		Financial instruments that potentially subject the Company to a significant concentration of credit risk consist primarily of cash and cash equivalents and pledged deposits. As of September 30, 2015 and March 31, 2016, substantially all of the Company’s cash and cash equivalents and pledged deposits were held by major financial institutions located in the PRC, which management believes are of high credit quality.

		For the credit risk related to trade accounts receivable, the Company performs ongoing credit evaluations of its customers and, if necessary, maintains reserves for potential credit losses. Historically, such losses have been within management’s expectations.