LONG-TERM INVESTMENTS

6 Months Ended

Jun. 30, 2022

NOTE 5 – LONG-TERM INVESTMENTS

As of June 30, 2022 and December 31, 2021, the Company’s long-term investments consisted of the following:


	June 30, 2022
	(unaudited)		December 31, 2021
Equity investments under cost method	$	1,337,728	$	1,435,330
REITs		1,147,865		1,261,482
Total long-term investments	$	2,485,593	$	2,696,812

Equity Investments under cost method using the measurement alternative


	June 30, 2022
	(unaudited)				December 31, 2021
	Investment				Investment
Investee	Ownership			Amount	Ownership			Amount
Genius Insurance Broker Co., Ltd (“GIB”)	11.73	%	$	1,292,928	11.73	%	$	1,388,151
Hainan Haoguan Yucheng Technology Service LLP (“HAINAN”)	9.99	%		44,800	9.99	%		47,179

On February 13, 2015, the Company and AHFL, a wholly owned subsidiary of the Company, entered into an acquisition agreement with Mr. Chwan Hau Li, the selling shareholder of GHFL. Subsequent to the acquisition, GHFL became a wholly-owned subsidiary of the Company which in turn holds approximately 15.64% issued and outstanding shares of Genius Insurance Broker Co., Ltd. (“Genius Broker”). Accordingly, the acquisition was accounted for as an asset acquisition of Genius Broker, which is an equity investment under cost method using the measurement alternative acquired by the Company.

The total paid-in capital with GIB changed from NTD 45 million to NTD 60 million due to capital increase taken place on August 14, 2020. GIC didn’t subscribe the new shares during the capital increase. As a result, the equity interest of GIB owned by GIC reduced from 15.64% to 11.73%.

A new investee in the investment ownership was due to the Company’s investment in HAINAN in 2021. HAINAN operates projects for insurance platforms, which contain insurance product centralized procurement, share service platform of sub-hierarchy distribution channel, and IoT business requirement. The Company invested HAINAN for RMB 300,000, or 9.99%, to engage in the qualification of supplier membership and distributor membership.

The change in carrying value of equity investment resulted from the fluctuation of exchange rates.

REITs

REITs are valued based on quoted market prices in the active market of Taiwan. The fair value of REITs as of June 30, 2022 and December 31, 2021 were $1,147,865 and $1,261,482, respectively.

Unrealized losses included in earnings for assets held at the end of the reporting periods were $11,610 and $61,635 for the three months ended June 30, 2022 and 2021, and were $28,051 and $82,124 for the six months ended June 30, 2022 and 2021, respectively.

For the three and six months ended June 30, 2022 and 2021, no other-than temporary impairment were recorded related to the long-term investments.

China United Insurance Service, Inc. 10-Q