Annual report pursuant to Section 13 and 15(d)

Shareholders' Equity

v3.21.2
Shareholders' Equity
12 Months Ended
Dec. 31, 2020
Stockholders' Equity Note [Abstract]  
SHAREHOLDERS' EQUITY

NOTE 13 – SHAREHOLDERS’ EQUITY

 

Statutory reserve

 

Pingtan Guansheng, Fujian Heyue, Pingtan Fishing and Pingtan Dingxin, which operate in the PRC are required to reserve 10% of their net profits after income tax, as determined in accordance with the PRC accounting rules and regulations. Appropriation to the statutory reserve by the Company is based on profit arrived at under PRC accounting standards for business enterprises for each year. The statutory reserves of the Company represent the statutory reserves of the above-mentioned companies as required under the PRC law.

 

The profit arrived at must be set off against any accumulated losses sustained by the Company in prior years, before allocation is made to the statutory reserve. Appropriation to the statutory reserve must be made before distribution of dividends to shareholders. The appropriation is required until the statutory reserve reaches 50% of the registered capital. This statutory reserve is not distributable in the form of cash dividends. As of December 31, 2015, the Company appropriated the required 50% of its registered capital to statutory reserve for Heyue. Accordingly, no additional statutory reserve for Heyue was required for the years ended December 31, 2020, 2019 and 2018.. The Company made appropriation to statutory reserve for Pingtan Fishing amounted to $2,961 by the end of year 2020. 

 

Pingtan Guansheng, Pingtan Dingxin, Pingtan Ocean, Fuzhou Howcious Investment, Pingtan Shinsilkroad and Pingtan Yikang had sustained losses since their establishment. No appropriation to their statutory reserves was required as they incurred recurring net losses.

 

For the years ended December 31, 2020 and 2019, statutory reserve activities for Pingtan Fishing and Fujian Heyue were as follows:

 

    Pingtan
Fishing
    Fujian
Heyue
    Total  
Balance - December 31, 2018   $ 13,955,930     $ 804,182     $ 14,760,112  
Addition to statutory reserve     988,639      
-
      988,639  
Balance – December 31, 2019     14,944,569       804,182       15,748,751  
Addition to statutory reserve     2,961      
-
      2,961  
Balance – December 31, 2020   $ 14,947,530     $ 804,182     $ 15,751,712