TRADE ACCOUNTS RECEIVABLE, NET

12 Months Ended

Jun. 30, 2016

Loans, Notes, Trade and Other Receivables Disclosure [Text Block]

NOTE 4. TRADE ACCOUNTS RECEIVABLE, NET

Accounts receivable consisted of the following:

	June 30, 2015		June 30, 2016		June 30, 2016
Third Party	RMB		RMB		U.S. Dollars
Trade accounts receivable	¥	58,049,462	¥	42,665,499	$	6,421,340
Allowance for doubtful accounts		(5,863,065)		(4,567,873)		(687,485)
Total - third- party, net	¥	52,186,397	¥	38,097,626	$	5,733,855

	June 30, 2015		June 30, 2016		June 30, 2016
Related Party	RMB		RMB		U.S. Dollars
Beijing Langchen Construction Company	¥	726,800	¥	-	$	-
Xiamen Huangsheng Hitek Computer Network Co. Ltd.**		980,000		-		-
Xiamen Henda Hitek Computer Network Co. Ltd.***		3,063,000		-		-
Total - related-parties, net	¥	4,769,800	¥	-	$	-

	June 30, 2015		June 30, 2016		June 30, 2016
Third Party – long-term	RMB		RMB		U.S. Dollars
Beijing Yabei Nuoda Science and Technology Co. Ltd. *	¥	4,934,072	¥	2,467,036	$	371,299
Allowance for doubtful accounts		(493,407)		(246,704)		(37,130)
Total - long-term trade accounts receivable, net	¥	4,440,665	¥	2,220,332	$	334,169

*The receivable from Yabei Nuoda was recognized primarily from the sale of automation system and services based on written contracts. Based on the repayment agreement signed on September 2, 2015, the outstanding balance was to be collected in two years beginning in 2017, with each installment of ¥2,467,036 ($371,299). During the year ended June 30, 2016, the Company received the payment on time as scheduled.

** During the year ended June 30, 2016, the Company offset ¥980,000 ($147,494) of accounts receivable and accounts payable pursuant to certain settlement agreements with Xiamen Huangsheng Hitek Computer Network Co. Ltd , a related party of the Company.

*** During the year ended June 30, 2016, the Company offset ¥2,699,347 ($406,263) of accounts receivable with ¥2,499,347 ($376,162) of accounts payable and ¥200,000 ($30,101) pursuant to certain settlement agreements with Xiamen Henda Hitek Computer Network Co. Ltd., a related party of the Company.

Provision for accounts receivables due from third party was ¥19,421 and ¥1,650,745 ($248,444) for the years ended June 30, 2015 and 2016, respectively.

Movement of allowance for doubtful accounts is as follows:

	June 30, 2015		June 30, 2016		June 30, 2016
	RMB		RMB		U.S. Dollars
Beginning balance		6,337,051		6,356,472		956,676
Charge to expense		19,421		1,650,745		248,444
Less: write-off		-		(3,192,640)		(480,505)
Ending balance	¥	6,356,472	¥	4,814,577	$	724,615

- Definition

The entire disclosure for claims held for amounts due a entity, excluding financing receivables. Examples include, but are not limited to, trade accounts receivables, notes receivables, loans receivables. Includes disclosure for allowance for credit losses.

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