Quarterly report pursuant to Section 13 or 15(d)

Equity Method Investment

v3.21.2
Equity Method Investment
9 Months Ended
Sep. 30, 2021
Equity Method Investments and Joint Ventures [Abstract]  
EQUITY METHOD INVESTMENT

NOTE 5 – EQUITY METHOD INVESTMENT

 

As of September 30, 2021 and December 31, 2020, the equity method investment amounted to $520,569 and $521,758, respectively. The investment represents the Company’s subsidiary, Avalon Shanghai’s interest in Epicon Biotech Co., Ltd. (“Epicon”). Epicon was incorporated on August 14, 2018 in PRC. Avalon Shanghai and the other unrelated company, Jiangsu Unicorn Biological Technology Co., Ltd. (“Unicorn”), accounted for 40% and 60% of the total ownership, respectively. Epicon is focused on cell preparation, third party testing, biological sample repository for commercial and scientific research purposes and the clinical transformation of scientific achievements.

 

The Company treats the equity investment in the consolidated financial statements under 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 post incorporation change in the Company’s share of the investee’s net assets and any impairment loss relating to the investment.

 

For the three months ended September 30, 2021 and 2020, the Company’s share of Epicon’s net loss was $14,203 and $14,966, respectively, which was included in loss from equity method investment in the accompanying condensed consolidated statements of operations and comprehensive loss. For the nine months ended September 30, 2021 and 2020, the Company’s share of Epicon’s net loss was $48,135 and $35,382, respectively, which was included in loss from equity method investment in the accompanying condensed consolidated statements of operations and comprehensive loss. In the nine months ended September 30, 2021, activity recorded for the Company’s equity method investment in Epicon is summarized in the following table:

 

Equity investment carrying amount at January 1, 2021   $ 521,758  
Payment made for equity method investment     40,179  
Epicon’s net loss attributable to the Company     (48,135 )
Foreign currency fluctuation     6,767  
Equity investment carrying amount at September 30, 2021   $ 520,569  

 

The tables below present the summarized financial information, as provided to the Company by the investee, for the unconsolidated company:

 

    September 30,
2021
    December 31,
2020
 
Current assets   $ 6,063     $ 13,023  
Noncurrent assets     229,105       264,390  
Current liabilities     41,306       6,615  
Noncurrent liabilities    
-
     
-
 
Equity     193,862       270,798  

  

    For the
Three Months Ended
September 30,
    For the
Nine Months Ended
September 30,
 
    2021     2020     2021     2020  
Net revenue   $
-
    $
-
    $
-
    $
-
 
Gross profit    
-
     
-
     
-
     
-
 
Loss from operation     35,509       37,418       120,338       88,587  
Net loss     35,509       37,417       120,338       88,456