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Goodwill

12 Months Ended

Dec. 31, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

13. Goodwill

The movement of the goodwill for the year ended December 31, 2021 is as follows:

Balance as of January 1, 2021	$	-
Acquisition of Hitrans		1,606,518
Foreign exchange adjustment		38,714
Balance as of December 31, 2021	$	1,645,232

To assess potential impairment of goodwill, the Company performs an assessment of the carrying value of the reporting units at least on an annual basis or when events occur or circumstances change that would more likely than not reduce the estimated fair value of the reporting units below its carrying value. The Company performed a goodwill impairment analysis as of December 31, 2021. When determining the fair value on reporting unit comprises of NCM precursor and cathode materials products (“Hitrans Reporting unit”), the Company used a discounted cash flow model that included a number of significant unobservable inputs. Key assumptions used to determine the estimated fair value include: (a) internal cash flows forecasts including expected revenue growth, operating margins and estimated capital needs, (b) an estimated terminal value using a terminal year long-term future growth rate determined based on the growth prospects of the reporting units; and (c) a discount rate that reflects the weighted-average cost of capital adjusted for the relevant risk associated with the Hitrans Reporting unit’s operation and the uncertainty inherent in the Company’s internally developed forecasts. Based on the Company’s assessment as of December 31, 2021, the fair value of Hitrans Reporting unit exceeded their carrying value.