Equity Method Investment
|6 Months Ended|
Jun. 30, 2021
|Equity Method Investments and Joint Ventures [Abstract]|
|EQUITY METHOD INVESTMENT||
NOTE 7 – EQUITY METHOD INVESTMENT
At June 30, 2021 and December 31, 2020, the equity investment amounted to $29,530,620 and $29,689,813, respectively. The investment represents the Company’s subsidiary, Pingtan Fishing’s interest in Global Deep Ocean. On June 12, 2014, Pingtan Fishing incorporated Global Deep Ocean with two unrelated companies in the PRC. In April 2017, these two companies sold their shares to another unrelated party, Zhen Lin. As of June 30, 2020 and 2021, Pingtan Fishing and Zhen Lin accounted for 20% and 80% of the total ownership, respectively.
Global Deep Ocean processes, stores, and transports Deep Ocean fishing products. Total registered capital of Global Deep Ocean is RMB 1 billion (approximately US $154.8 million) and as of June 30, 2021, Pingtan Fishing had contributed its share of registered capital of RMB 200 million (approximately US$31.0 million).
The Company measures this equity investment in the consolidated financial statements utilizing the equity method. Under the equity method, the investment is initially recorded at cost, adjusted for any excess of the Company’s share of the incorporated-date fair values of the investee’s identifiable net assets over the cost of the investment (if any). Thereafter, the investment is adjusted for the changes in the Company’s share of the investee’s net assets and any impairment loss relating to the investment. For the three months ended June 30, 2021 and 2020, the Company’s share of Global Deep Ocean’s net loss was $244,313 and $143,015, respectively, which was included in loss on equity method investment in the accompanying consolidated statements of operations and comprehensive income. For the six months ended June 30, 2021 and 2020, the Company’s share of Global Deep Ocean’s net loss was $456,180 and $268,543, respectively, which was included in loss on equity method investment in the accompanying consolidated statements of operations and comprehensive income.
The entire disclosure for equity method investments and joint ventures. Equity method investments are investments that give the investor the ability to exercise significant influence over the operating and financial policies of an investee. Joint ventures are entities owned and operated by a small group of businesses as a separate and specific business or project for the mutual benefit of the members of the group.
Reference 1: http://www.xbrl.org/2003/role/disclosureRef