Restatement (Tables)

9 Months Ended

Sep. 30, 2016

Schedule of restatement on consolidated balance sheet

	As Previously Reported			Restated			Net Adjustment
Accounts receivable		25,062,146			25,723,889			661,743
Current portion of investment in sales-type leases, net		6,948,365			6,973,954			25,589
Interest receivable on sales-type leases		3,320,420			3,094,017			(226,403	)
Other receivables		873,448			387,477			(485,971	)

Investment in sales-type leases, net		109,728,463			52,512,266			(57,216,197	)
Total assets		277,533,892			220,292,653			(57,241,239	)

Deferred tax liability, net (current)		1,089,690			1,103,309			13,619
Deferred tax liability, net (non-current)		8,811,021			2,578,984			(6,232,037	)
Total liabilities		66,981,515			60,763,097			(6,218,418	)

Statutory reserve		14,448,084			14,210,589			(237,495	)
Accumulated other comprehensive income		(2,689,316	)		(2,589,793	)		99,523
Retained earnings		87,015,098			36,130,249			(50,884,849	)
Total company stockholders’ equity		210,571,342			159,548,521			(51,022,821	)
Total liabilities and equity		277,533,892			220,292,653			(57,241,239	)

Schedule of restatement on consolidated statement of income and comprehensive income

The following table presents the effects of the restatement on the accompanying consolidated statement of income and comprehensive income for the nine months ended September 30, 2016:

	As Previously Reported			Restated			Net Adjustment
Contingent rental income		-			2,791,444			2,791,444
Cost of sales		-			-			-
Gross profit		-			2,791,444			2,791,444
Interest income on sales-type leases		10,945,411			9,879,962			(1,065,449	)
Total operating income		10,945,411			12,671,406			1,725,995
General and administrative expenses		1,153,894			3,064,746			1,910,852
Impairment loss of net investment receivable					57,168,035			57,168,035
Income (loss) from operations		9,791,517			(47,561,375	)		(57,352,892	)

Income (loss) before income tax		1,888,854			(55,464,038	)		(57,352,892	)
Income tax benefit		(861,811	)		(7,092,359	)		(6,230,548	)

Net income (loss) attributable to China Recycling Energy Corporation		2,977,791			(48,144,553	)		(51,122,344	)
Foreign currency translation gain (loss)		(5,899,631	)		(5,800,108	)		99,523
Comprehensive loss attributable to China Recycling Energy Corporation		(2,921,840	)		(53,944,661	)		(51,022,821	)

The following table presents the effects of the restatement on the accompanying consolidated statement of income and comprehensive income for the three months ended September 30, 2016:

	As Previously Reported			Restated			Net Adjustment
Contingent rental income		-			1,683,723			1,683,723
Cost of Sales		-			-			-
Gross profit		-			1,683,723			1,683,723
Interest income on sales-type leases		2,286,948			1,682,428			(604,520	)
Total operating income		2,286,948			3,366,151			1,079,203
General and administrative expense		299,110			1,431,719			1,132,609
Impairment loss of net investment receivable					(1,184,209	)		(1,184,209	)
Income from operations		1,987,838			3,118,641			1,130,803

Income before income tax		567,875			1,698,678			1,130,803
Income tax expense (benefit)		110,957			88,926			(22,031	)

Net income attributable to China Recycling Energy Corporation		536,839			1,689,673			1,152,834
Foreign currency translation loss		(1,400,319	)		(2,096,212	)		(695,893	)
Comprehensive income (loss) attributable to China Recycling Energy Corporation		(863,480	)		(406,539	)		456,941

Schedule of restatement on consolidated statement of cash flows

	As Previously Reported			Restated			Net Adjustment
Income including noncontrolling interest		2,750,665			(48,371,679	)		(51,122,344	)
Impairment loss of net investment receivable		-			57,168,035			57,168,035
Changes in deferred tax		(2,073,235	)		(8,303,783	)		(6,230,548	)
Interest receivable on sales type leases		(2,785,713	)		(2,600,856	)		184,857

Net cash provided by operating activities		30,432,764			30,432,764			-