XML 25 R13.htm IDEA: XBRL DOCUMENT

Property, Plant and Equipment, net

9 Months Ended

Jun. 30, 2016

Property, Plant and Equipment, net [Text Block]

7.	Property, Plant and Equipment, net

Property, plant and equipment as of September 30, 2015 and June 30, 2016 consisted of the following:

		September 30,			June 30,
		2015			2016
Buildings	$	18,440,000		$	17,629,313
Machinery and equipment		4,020,238			4,132,736
Office equipment		37,050			78,356
Motor vehicles		147,197			140,726
		22,644,485			21,981,131
Accumulated depreciation		(369,665	)		(1,190,679	)
Carrying amount	$	22,274,820		$	20,790,452

Depreciation expense for the three and nine months ended June 30, 2015 and 2016 is included in the condensed consolidated statements of operations as follows:

		Three months ended June 30,				Nine months ended June 30,
		2015		2016		2015		2016
Cost of revenues	$	-	$	216,828	$	-	$	634,465
Research and development expenses		99,917		15,682		99,917		45,282
Sales and marketing expenses		-		11		-		11
General and administrative expenses		7,050		66,131		20,309		178,272
	$	106,967	$	298,652	$	120,226	$	858,030

The Company has not yet obtained the property ownership of the buildings in its Dalian manufacture facilities with a carrying amount of $18,318,313 and $17,135,560 as of September 30, 2015 and June 30, 2016, respectively. The management expects that they will obtain the property ownership rights in September 2016.

During the course of the Company’s strategic review of its operations, the Company assessed the recoverability of the carrying value of the Company’s property, plant and equipment. The impairment charge, if any, represented the excess of carrying amounts of the Company’s property, plant and equipment over the estimated discounted cash flows expected to be generated by the Company’s production facilities. The Company believes that there was no impairment of its property, plant and equipment for the three and nine months ended June 30, 2015 and 2016.