0001617351 false --07-31 Q1 2022 0001617351 2021-08-01 2021-10-31 0001617351 2021-10-31 0001617351 2021-07-31 0001617351 2020-08-01 2020-10-31 0001617351 us-gaap:CommonStockMember 2020-07-31 0001617351 us-gaap:AdditionalPaidInCapitalMember 2020-07-31 0001617351 LEPX:RetainedEarningsUnrestrictedMember 2020-07-31 0001617351 LEPX:RetainedEarningsStatutoryReserveMember 2020-07-31 0001617351 LEPX:ForeignCurrencyReservesMember 2020-07-31 0001617351 2020-07-31 0001617351 us-gaap:CommonStockMember 2020-08-01 2020-10-31 0001617351 us-gaap:AdditionalPaidInCapitalMember 2020-08-01 2020-10-31 0001617351 LEPX:RetainedEarningsUnrestrictedMember 2020-08-01 2020-10-31 0001617351 LEPX:RetainedEarningsStatutoryReserveMember 2020-08-01 2020-10-31 0001617351 LEPX:ForeignCurrencyReservesMember 2020-08-01 2020-10-31 0001617351 us-gaap:CommonStockMember 2020-10-31 0001617351 us-gaap:AdditionalPaidInCapitalMember 2020-10-31 0001617351 LEPX:RetainedEarningsUnrestrictedMember 2020-10-31 0001617351 LEPX:RetainedEarningsStatutoryReserveMember 2020-10-31 0001617351 LEPX:ForeignCurrencyReservesMember 2020-10-31 0001617351 2020-10-31 0001617351 us-gaap:CommonStockMember 2021-07-31 0001617351 us-gaap:AdditionalPaidInCapitalMember 2021-07-31 0001617351 LEPX:RetainedEarningsUnrestrictedMember 2021-07-31 0001617351 LEPX:RetainedEarningsStatutoryReserveMember 2021-07-31 0001617351 LEPX:ForeignCurrencyReservesMember 2021-07-31 0001617351 us-gaap:CommonStockMember 2021-08-01 2021-10-31 0001617351 us-gaap:AdditionalPaidInCapitalMember 2021-08-01 2021-10-31 0001617351 LEPX:RetainedEarningsUnrestrictedMember 2021-08-01 2021-10-31 0001617351 LEPX:RetainedEarningsStatutoryReserveMember 2021-08-01 2021-10-31 0001617351 LEPX:ForeignCurrencyReservesMember 2021-08-01 2021-10-31 0001617351 us-gaap:CommonStockMember 2021-10-31 0001617351 us-gaap:AdditionalPaidInCapitalMember 2021-10-31 0001617351 LEPX:RetainedEarningsUnrestrictedMember 2021-10-31 0001617351 LEPX:RetainedEarningsStatutoryReserveMember 2021-10-31 0001617351 LEPX:ForeignCurrencyReservesMember 2021-10-31 0001617351 LEPX:ReneLawrenceMember us-gaap:PrivatePlacementMember 2020-02-16 2020-02-18 0001617351 LEPX:ZhaoLixinMember 2020-02-16 2020-02-18 0001617351 2020-04-13 0001617351 2020-04-14 0001617351 2020-06-01 2020-06-02 0001617351 2020-06-02 0001617351 LEPX:ShareExchangeAgreementMember LEPX:MuYanSamoaAndShareholdersMember 2020-08-11 2020-08-12 0001617351 LEPX:ShareExchangeAgreementMember LEPX:MuYanSamoaMember 2020-08-11 2020-08-12 0001617351 LEPX:PeriodEndRMBMember 2021-10-31 0001617351 LEPX:PeriodEndRMBMember 2020-10-31 0001617351 LEPX:PeriodAverageRMBMember 2021-10-31 0001617351 LEPX:PeriodAverageRMBMember 2020-10-31 0001617351 us-gaap:VehiclesMember srt:MinimumMember 2021-08-01 2021-10-31 0001617351 us-gaap:VehiclesMember srt:MaximumMember 2021-08-01 2021-10-31 0001617351 us-gaap:OfficeEquipmentMember 2021-08-01 2021-10-31 0001617351 2020-08-01 2021-07-31 0001617351 LEPX:RentalDepositMember 2021-10-31 0001617351 LEPX:RentalDepositMember 2021-07-31 0001617351 LEPX:PendingInputVatMember 2021-10-31 0001617351 LEPX:PendingInputVatMember 2021-07-31 0001617351 LEPX:PrepaidLegalServiceFeeMember 2021-10-31 0001617351 LEPX:PrepaidLegalServiceFeeMember 2021-07-31 0001617351 LEPX:AmountForRAndDServiceFeeMember 2021-10-31 0001617351 LEPX:AmountForRAndDServiceFeeMember 2021-07-31 0001617351 LEPX:OthersMember 2021-10-31 0001617351 LEPX:OthersMember 2021-07-31 0001617351 LEPX:ThirdPartyMember us-gaap:ResearchAndDevelopmentArrangementMember 2021-04-22 0001617351 LEPX:MrZhaoLixinMember 2021-05-01 2021-05-10 0001617351 LEPX:MrZhaoLixinMember 2021-05-10 0001617351 LEPX:MotorVehicleMember 2021-10-31 0001617351 LEPX:OneDesktopComputersMember 2021-10-31 0001617351 us-gaap:OfficeEquipmentMember 2021-10-31 0001617351 2019-08-01 2020-07-31 0001617351 country:HK 2021-08-01 2021-10-31 0001617351 LEPX:PRCMember 2021-08-01 2021-10-31 0001617351 LEPX:StateAdministrationOfTaxationMember 2019-04-01 2019-04-02 0001617351 LEPX:GeneralAdministrationOfCustomsMember 2019-04-01 2019-04-02 0001617351 2019-04-02 0001617351 LEPX:HangZhouHuoBaoBaoADandMediaCoLtdMember 2021-08-01 2021-10-31 0001617351 LEPX:HangZhouHuoBaoBaoADandMediaCoLtdMember 2021-10-31 0001617351 LEPX:HangZhouHuoBaoBaoADandMediaCoLtdMember 2021-07-31 0001617351 LEPX:BangBiTuoShenZhenTechnologyCoLTDMember 2021-08-01 2021-10-31 0001617351 LEPX:BangBiTuoShenZhenTechnologyCoLTDMember 2021-10-31 0001617351 LEPX:BangBiTuoShenZhenTechnologyCoLTDMember 2021-07-31 0001617351 LEPX:ZhaoLixinMember 2021-08-01 2021-10-31 0001617351 LEPX:ZhaoLixinMember 2021-10-31 0001617351 LEPX:ZhaoLixinMember 2021-07-31 0001617351 us-gaap:ServiceMember LEPX:HangZhouHuoBaoBaoADandMediaCoLtdMember 2021-08-01 2021-10-31 0001617351 us-gaap:ServiceMember LEPX:HangZhouHuoBaoBaoADandMediaCoLtdMember 2020-08-01 2021-07-31 0001617351 LEPX:BangBiTuoShenZhenTechnologyCoLTDMember 2020-08-01 2021-07-31 0001617351 2020-07-02 iso4217:USD xbrli:shares iso4217:USD xbrli:shares xbrli:pure iso4217:HKD

U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

Mark One

~~[X]~~☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~April~~October 3031, 2021

~~[ ]~~☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______ to _______

Commission File No. 333-198808

MU YAN TECHNOLOGY GROUP CO., LIMITED

(Formerly, Lepota Inc.)

(Exact name of registrant as specified in its charter)

Nevada		EIN 47-1549749
(State or Other Jurisdiction of		(IRS Employer
Incorporation or Organization)		Identification Number)

Room 1703B, Zhongzhou Building,

No. 3088, Jintian Road, Futian District

Shenzhen City, Guangdong Province

People’s Republic of China 518000

(Address of principal executive offices)

+86 0755 8325-7679

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act: None

Indicate by check mark whether the registrant has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes ~~[X]~~☒ No ~~[ ]~~☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ~~[X]~~☒ No ~~[ ]~~☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer [☐ ] Accelerated filer [☐ ] Non-accelerated filer ~~[X]~~☒ Smaller reporting company ~~[X]~~☒ Emerging growth company ~~[X]~~☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ~~[ ]~~☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act)

Yes ~~[ ]~~☐ No ~~[X]~~☒

As of ~~April~~October 3031, 2021, the registrant had 307,430,000 shares of common stock issued and outstanding.

PART I

Item 1. Financial statements.

~~CONDENSED~~ CONSOLIDATED BALANCE SHEETS

(In U.S. Dollars, except share data or otherwise stated)

AS OF THE PERIOD ENDED ~~APRIL~~OCTOBER 3031, 2021 AND THE YEAR ENDED JULY 31, ~~2020~~2021

	Nine Months Ended			Fiscal Year Ended
	Three Months Ended			The Year Ended
	April 30, 2021			July 31, 2020
	October 31, 2021			July 31, 2021
	(Unaudited)			(Audited)
Assets
Current assets
Cash and cash equivalents	$	~~616~~437,~~108~~665		$	~~864~~1,~~860~~092,575
Down payment to suppliers	$	~~192~~36,~~049~~345		$	~~179~~225,~~426~~489
Amount due from related parties	$	~~590~~310,~~720~~603		$	1371,~~073,761~~473
Other receivables	$	1390,~~282,807~~421		$	93479,~~067~~739
Accounts receivable		3,866			-
Advance for vehicle purchase	$	-		$	1,849,788
Inventory, net	$	193,079		$	1,212,381
Accounts receivable	$	3,912		$	3,870
Held for sale assets	$	2,241,424		$	2,075,326
Inventory, net	$	522,047		$	236,046
Total current assets	$	5,120,053		$	5,498,821
Held for sale assets	$	-		$	2,243,852
Total current assets	$	1,700,993		$	6,502,832
Non-current assets
Property, plant and equipment, net	$	~~337~~1,~~321~~839,718		$	~~204~~337,~~103~~881
Operating lease right-of-use assets	$	~~350~~206,~~082~~114		$	~~515~~278,~~589~~712
Total non-current assets	$	~~687~~2,~~403~~045,832		$	~~719~~616,~~692~~593
Total assets	$	53,~~807~~746,~~456~~825		$	67,~~218~~119,~~513~~425
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable	$	~~441~~5,~~138~~175		$	~~307~~320,~~415~~224
Advance from customers	$	-9,389		$	1176,~~539,343~~465
Other payables	$	~~159~~196,~~688~~034		$	~~229~~232,~~195~~265
Income tax payable	$	~~610~~22,~~628~~528		$	~~440~~21,~~323~~691
Current operating lease liabilities	$	~~298~~206,~~558~~114		$	~~257~~278,~~810~~712
Amount due to related parties	$	-		$	642,~~645~~554,100
Total current liabilities	$	1439,~~510,012~~240		$	23,~~838~~583,~~731~~457
Non-current liabilities
Lease liabilities, non-current	$	~~51,524~~-		$	~~257,779~~-
Total non-current liabilities	$	~~51,524~~-		$	~~257,779~~-
Total liabilities	$	1439,~~561,536~~240		$	3,~~096~~583,~~510~~457
Stockholders’ equity
Common stock ($0.001 par value, 500,000,000 shares authorized, 307,430,000 shares issued and outstanding at April 30, 2021 and July 31, 2020, respectively)(1)	$	307,430		$	307,430
Common stock ($0.001 par value, 500,000,000 shares authorized, 307,430,000 shares issued and outstanding at October 31, 2021 and July 31, 2021, respectively)	$	307,430		$	307,430
Additional paid-in capital(1)	$	(263,298	)	$	(263,298	)
Additional paid-in capital	$	(263,298	)	$	(263,298	)
Retained profits	$	32,~~430~~469,~~592~~445		$	32,~~058~~733,~~049~~265
Statutory reserve	$	485,415		$	-485,415
Foreign currency translation reserve	$	~~285~~308,~~781~~593		$	19273,~~822~~156
Total stockholders’ equity	$	43,~~245~~307,~~920~~585		$	3,~~122~~535,~~003~~968
Total liabilities and stockholders’ equity	$	53,~~807~~746,~~456~~825		$	67,~~218~~119,~~513~~425

~~(1)~~See ~~Par~~accompanying ~~value~~notes ~~of shares, additional paid-in capital and share data have been retroactively restated~~ to ~~give effect to~~ the ~~share~~consolidated ~~exchange effected~~financial ~~on August 12, 2020~~statements. ~~See Note 1. “Description of the Business and Organization.”~~

See accompanying notes to the condensed consolidated financial statements.

MU YAN TECHNOLOGY GROUP CO., LIMITED ~~(fka “LEPOTA INC.”)~~

AND ITS SUBSIDIARIES

~~CONDENSED~~ CONSOLIDATED STATEMENTS OF INCOME (LOSS) AND COMPREHENSIVE INCOME (LOSS)

(In U.S. Dollars, except share data or otherwise stated)

FOR THE THREE ~~AND NINE~~ MONTHS ENDED ~~APRIL~~OCTOBER 3031, 2021

AND

~~APRIL~~OCTOBER 3031, 2020

(Unaudited)


	Three months ended
	October 31, 2021			October 31, 2020
	(Unaudited)			(Audited)
Revenues	$	168,235		$	4,551,255
Cost of revenues	$	(25,658	)	$	(1,955,934	)
Taxes and surcharges	$	(3,426	)	$	(39,527	)
Gross profit	$	139,151		$	2,555,794
Operating expenses
Selling and marketing expenses	$	(525	)	$	(141,005	)
General and Administrative Expenses	$	(490,421	)	$	(326,233	)
Research and development expenses	$	(269,349	)	$	(86,782	)
Total operating expenses	$	(760,295	)	$	(554,020	)
Other income, net	$	357,920		$	46

Profit (loss) before tax	$	(263,224	)	$	2,001,820
Income tax	$	(596	)	$	(506,818	)
Net profit (loss)	$	(263,820	)	$	1,495,002

Foreign currency translation differences	$	35,437		$	138,218
Total comprehensive profit (loss) for the period	$	(228,383	)	$	1,633,220

(Loss) earnings per share – basic and diluted	$	(0.00	)	$	0.01
Weighted average number of shares outstanding – Basic and diluted		307,430,000			307,430,000

	Three months ended April 30,						Nine months ended April 30,
	2021			2020			2021			2020
Revenues	$	59,769		$	1,709,292		$	6,218,736		$	4,798,863
Cost of revenues	$	(23,695	)	$	(556,013	)	$	(2,616,494	)	$	(1,752,534	)
Taxes and surcharges	$	(414	)	$	(4,552	)	$	(51,888	)	$	(13,620	)
Gross profit	$	35,660		$	1,148,727		$	3,550,354		$	3,032,709
Operating expenses
Selling and marketing expenses	$	(4,904	)	$	(186,885	)	$	(620,226	)	$	(479,265	)
General and administrative expenses	$	(465,150	)	$	(157,276	)	$	(1,280,283	)	$	(510,431	)
Research and development expenses	$	(74,509	)	$	(218,193	)	$	(244,985	)	$	(245,869	)
Total operating expenses	$	(544,563	)	$	(562,354	)	$	(2,145,494	)	$	(1,235,565	)
(Other expenses)/other income, net	$	(21,334	)	$	336,097		$	(15,772	)	$	369,854
(Loss)/profit before tax	$	(530,237	)	$	922,470		$	1,389,088		$	2,166,998
Income tax	$	(11,141	)	$	(326,330	)	$	(531,130	)	$	(551,068	)
Net (loss)/profit	$	(541,378	)	$	596,140		$	857,958		$	1,615,930
Foreign currency translation differences	$	(22,405	)	$	(32,236	)	$	265,959		$	(10,062	)
Total comprehensive (loss)/profit	$	(563,783	)	$	563,904		$	1,123,917		$	1,605,868
Earnings per share – basic and diluted(1)	$	(0.00	)	$	0.00		$	0.00		$	0.01
Weighted average number of shares – basic and diluted(1)		307,430,000			307,430,000			307,430,000			307,430,000

See accompanying notes to the consolidated financial statements.

(1) Share and per share data have been retroactively restated to give effect to the share exchange effected on August 12, 2020. See Note 1. “Description of the Business and Organization.”

See accompanying notes to the condensed consolidated financial statements.

MU YAN TECHNOLOGY GROUP CO., LIMITED ~~(fka “LEPOTA INC.”)~~

AND ITS SUBSIDIARIES

~~CONDENSED~~ CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (DEFICIT)

(In U.S. Dollars, except share data or otherwise stated)

FOR THE ~~NINE~~THREE MONTHS ENDED ~~APRIL~~OCTOBER 3031, 2021 ~~AND THE YEAR ENDED JULY 31, 2020~~

~~(Unaudited)~~AND

	Common Stock				Additional			Retained Earnings					Foreign			Total
	Shares		Amount		Paid-in Capital			Unrestricted			Statutory reserve		Currency Reserves			Equity
Balance at July 31, 2019		307,430,000	$	307,430	$	(278,130	)	$	(36,650	)	$	-	$	-		$	(7,350	)
Asset and liabilities discharged by ex-shareholders					$	14,832										$	14,832
Foreign currency translation		-	$	-	$	-		$	-		$	-	$	(10,062	)	$	(10,062	)
Net profit		-	$	-	$	-		$	1,615,930		$	-	$	-		$	1,615,930
Balance at April 30, 2020		307,430,000	$	307,430	$	(263,298	)	$	1,579,280		$	-	$	(10,062	)	$	1,613,350
Balance at July 31, 2020		307,430,000	$	307,430	$	(263,298	)	$	3,058,049		$	-	$	19,822		$	3,122,003
Movement of Statutory reserve		-	$	-	$	-		$	(485,415	)	$	485,415	$	-		$	-
Foreign currency translation		-	$	-	$	-		$	-		$	-	$	265,959		$	265,959
Net profit		-	$	-	$	-		$	857,958		$	-	$	-		$	857,958
Balance at April 31, 2021		307,430,000	$	307,430	$	(263,298	)	$	3,430,592		$	485,415	$	285,781		$	4,245,920

OCTOBER 31, 2020

See accompanying notes to the condensed consolidated financial statements.


	Common Stock				Additional			Retained Earnings					Foreign		Total
	Shares		Amount		Paid-inCapital			Unrestricted			Statutory reserve		Currency Reserves		Equity
Balance at July 31, 2020		307,430,000	$	307,430	$	(263,298	)	$	3,058,049		$	-	$	19,822	$	3,122,003
Foreign currency translation		-	$	-	$	-		$	-		$	-	$	138,218	$	138,218
Net profit		-	$	-	$	-		$	1,495,002		$	-	$	-	$	1,495,002
Balance at October 31, 2020		307,430,000	$	307,430	$	(263,298	)	$	4,553,051		$	-	$	158,040	$	4,755,223

Balance at July 31, 2021		307,430,000	$	307,430	$	(263,298	)	$	2,733,265		$	485,415	$	273,156	$	3,535,968
Foreign currency translation		-	$	-	$	-		$	-		$	-	$	35,437	$	35,437
Net profit		-	$	-	$	-		$	(263,820	)	$	-	$	-	$	(263,820	)
Balance at October 31, 2021		307,430,000	$	307,430	$	(263,298	)	$	2,469,445		$	485,415	$	308,593	$	3,307,585

See accompanying notes to the consolidated financial statements.

MU YAN TECHNOLOGY GROUP CO., LIMITED ~~(fka “LEPOTA INC.”)~~

AND ITS SUBSIDIARIES

~~CONDENSED~~ CONSOLIDATED STATEMENTS OF CASH FLOWS

(In U.S. Dollars, except share data or otherwise stated)

FOR THE ~~NINE~~THREE MONTHS ENDED ~~APRIL~~OCTOBER 3031, 2021

AND

~~THE~~OCTOBER ~~NINE MONTHS ENDED APRIL 30~~31, 2020

(Unaudited)


	October 31, 2021			October 31, 2020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	(263,820	)	$	1,495,002
Adjustments for:
Depreciation	$	50,127		$	14,856
Operating profit before working capital changes:	$	(213,693	)	$	1,509,858
(Increase) decrease in:
Accounts receivable	$	-		$	-
Tax Payable	$	596		$	303,302
Other receivables	$	129,545		$	(2,957,626	)
Advance for vehicle purchase	$	1,714,936		$	-
Inventories	$	(280,915	)	$	532,432
Held for sale assets	$	2,248,098		$	-
Accrued expense and other payables	$	23,066		$	(5,916	)
Accounts payable	$	(121,506	)	$	754,832
Down payment to suppliers	$	171,595		$	157,672
Advance from customers	$	(167,494	)	$	(1,581,657	)
Amount due to a related party	$	(2,558,933	)	$	20,213
Amount due from related parties	$	64,333		$	547,428
Net cash provided by (used in) operating activities	$	1,009,628		$	(719,462	)
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of property, plant and equipment	$	(1,674,569	)	$	(2,339	)
Net cash used in investing activities	$	(1,674,569	)	$	(2,339	)
CASH FLOWS FROM FINANCING ACTIVITIES
Sale of common shares	$	-		$	-
Net cash provided by financing activities	$	-		$	-
Effect of exchange rate changes on cash and cash equivalents	$	10,031		$	22,667
Net decrease in cash and cash equivalents	$	(654,910	)	$	(699,134	)
Cash and cash equivalents at beginning of period	$	1,092,575		$	864,860
CASH AND CASH EQUIVALENTS, END OF PERIOD	$	437,665		$	165,726
SUPPLEMENTAL CASH FLOW INFORMATION
Income tax paid	$	-		$	200,916
Right-of-use assets obtained in exchange for operating lease liabilities	$	206,114		$	470,135

	April 30, 2021			April 30, 2020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	857,958		$	1,615,930
Adjustments for:	$			$
Depreciation	$	55,799		$	14,620
Operating profit before working capital changes:	$	913,757		$	1,630,550
(Increase) decrease in:
Accounts receivable	$	(3,783	)	$	-
Tax Payable	$	132,173		$	184,477
Other receivables	$	(718,393	)	$	(57,167	)
Inventories	$	1,092,446		$	(543,769	)
Held for sale assets		-			(986,695	)
Accrued expense and other payables	$	(135,686	)	$	78,971
Accounts payable	$	106,784		$	654,171
Down payment to suppliers	$	(455,107	)	$	(238,626	)
Advance from customers	$	(1,626,965	)	$	21,387
Amount due to a related party		-			85,766
Amount due from related parties	$	556,802		$	(213,868	)
Net cash used in operating activities	$	(137,972	)	$	615,197
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of property, plant and equipment	$	(170,180	)	$	(227,244	)
Net cash used in investing activities	$	(170,180	)	$	(227,244	)
CASH FLOWS FROM FINANCING ACTIVITIES
Sale of common shares	$	-		$	5,148
Net cash provided by financing activities	$	-		$	5,148
Effect of exchange rate changes on cash and cash equivalents	$	59,400		$	2,951
Net decrease in cash and cash equivalents	$	(248,752	)	$	396,052
Cash and cash equivalents at beginning of period	$	864,860		$	2,334
CASH AND CASH EQUIVALENTS, END OF PERIOD	$	616,108		$	398,386
SUPPLEMENTAL CASH FLOW INFORMATION
Income tax paid	$	452,696		$	366,591
Right-of-use assets obtained in exchange for operating lease liabilities	$	350,082		$	-

See accompanying notes to the consolidated financial statements.

See accompanying notes to the condensed consolidated financial statements.

MU YAN TECHNOLOGY GROUP CO., LIMITED ~~(fka “LEPOTA INC.”)~~

AND ITS SUBSIDIARIES

NOTES TO THE ~~CONDENSED~~ CONSOLIDATED FINANCIAL STATEMENTS

FOR THE ~~NINE~~THREE MONTHS ENDED ~~APRIL~~OCTOBER 3031, 2021

AND

~~THE~~OCTOBER ~~NINE MONTHS ENDED APRIL 30~~31, 2020

(UNAUDITED)

NOTE 1. DESCRIPTION OF THE BUSINESS AND ORGANIZATION

Mu Yan Technology Group Co., Limited, formerly Lepota Inc. (“MYTG” or the “Company”), is a US holding company incorporated in Nevada on December 9, 2013. Our primary business originally was in the import of cosmetics into the Russian Federation and distribution of the products through shops and drugstores. However, since August 12, 2020, we have been engaged in the mobile advertisement backpack business. The Company’s current address is Room 1703B, Zhongzhou Building, No. 3088, Jintian Road, Futian District, Shenzhen City, Guangdong Province, People’s Republic of China 518000.

On February 18, 2020, as a result of a private transaction, 5,000,000 shares of our common stock (the “Shares”) were transferred from Rene Lawrence to certain purchasers, including Zhao Lixin who became a 53.8% holder of the voting rights of the Company at the time. The consideration paid for the Shares, which represented 67.3% of the issued and outstanding share capital of the Company on a fully-diluted basis, was $257,160. The source of the cash consideration for the Shares was personal funds of the Purchasers.

On April 14, 2020, the Company filed a Certificate of Amendment with the Secretary of State of the State of Nevada to amend the Articles of Incorporation of the Company by increasing the authorized common stock of the Company from 75,000,000 shares to 500,000,000 shares.

Mu Yan Technology Holding Co., Ltd (“Mu Yan Samoa”) was incorporated in the Independent State of Samoa on April 2, 2020. Mu Yan Samoa, together with its subsidiaries, is engaged in the mobile advertisement backpack business.

Mu Yan (Hong Kong) Technology Co., Limited, (“Mu Yan HK”), a wholly-owned subsidiary of Mu Yan Samoa, was incorporated in Hong Kong on January 10, 2020. On June 1, 2020, Mu Yan Samoa entered into an equity transfer agreement with the shareholder of Mu Yan HK, under which Mu Yan Samoa agreed to pay total consideration of HKD 1,000 (approximately $128.21) in cash in exchange for a 100% ownership interest in Mu Yan HK.

Mu Yan (Shenzhen) Media Technology Co., Ltd. (“Mu Yan WFOE”), a wholly-owned subsidiary of Mu Yan HK, was incorporated in the PRC on June 10, 2020.

Mu Yan (Shenzhen) Digital Technology Co., Ltd. (“Mu Yan Shenzhen”) was incorporated in the PRC on September 30, 2019 and became a wholly-owned subsidiary of Mu Yan WFOE on July 1, 2020. Mu Yan Shenzhen sells its mobile advertisement backpacks to consumers in the PRC and worldwide and operates primarily out of the PRC. Mu Yan Shenzhen was controlled by the same owner immediately prior to its acquisition by Mu Yan HK. As these transactions are between entities under common control, the Company has reported the results of operations for the periods in a manner similar to a pooling of interests and has consolidated financial results since the initial date in which the above companies were under common control. Assets and liabilities were combined on their carrying values and no recognition of goodwill was made.

On August 12, 2020, the Company entered into a Share Exchange Agreement (the “Exchange Agreement”), with Mu Yan Samoa and shareholders who together own shares constituting 100% of the issued and outstanding shares of Mu Yan Samoa and who are listed in Annex I to the Exchange Agreement (the “Sellers”). Pursuant to the terms of the Exchange Agreement, the Sellers transferred to the Company all of their shares of Mu Yan Samoa in exchange for the issuance of 300,000,000 shares (the “Shares”) of the Company’s common stock (representing approximately 98% of the Company’s outstanding common stock upon issuance) (the “Acquisition”). The Acquisition is accounted for as a reverse merger because on a post-merger basis, the former shareholders of Mu Yan Samoa held a majority of our outstanding ordinary shares on a voting and fully diluted basis.

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying ~~condensed~~ consolidated financial statements include the balances and results of operations of the Company. The ~~condensed~~ consolidated financial statements have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) and in conformity with generally accepted accounting principles in the U.S. (“US GAAP”).

The accompanying ~~condensed~~ consolidated financial statements are presented on the basis that the Company is a going concern. The going concern ~~assumption~~ assumption contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

Basis of Consolidation

The ~~condensed~~ consolidated financial statements include the financial statements of the Company and its subsidiaries. Subsidiaries are all ~~entities~~ entities over which the Company has control. Control exists when the Company has the power over the entity, exposure or rights to variable ~~returns~~ returns from involvement in the entity and the ability to use power over the entity to affect returns through its power over the entity. In assessing control, potential voting rights that presently are exercisable are taken into account. The financial statements of subsidiaries ~~are~~ are included in the ~~condensed~~ consolidated financial statements from the date that control commences until the date that control ceases.

Economic and Political Risks

The Company’s operations are conducted in the PRC. Accordingly, the Company’s business, financial condition and results of operations may be influenced by the political, economic and legal environment in the PRC and by the general state of the PRC economy. Because all of our operations are conducted in the PRC through our wholly-owned subsidiaries, the Chinese government may exercise significant oversight and discretion over the conduct of our business and may intervene in or influence our operations at any time, which could result in a material change in our operations and/or the value of our shares.

The Company’s operations in the PRC are subject to special considerations and significant risks not typically associated with companies in North America and Western Europe. These include risks associated with, among others, the political, economic and legal environment and foreign currency exchange. The Company’s results may be adversely affected by changes in the political and social conditions in the PRC and by changes in governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversion, remittances abroad and rates and methods of taxation.

Foreign Currency Translation

The Company’s reporting currency is the U.S. dollar and the functional currency is the Chinese Renminbi (“RMB”). All assets and liabilities are translated at exchange rates at the balance sheet date, revenue and expenses are translated at the average yearly exchange rates and equity is translated at historical exchange rates. Any translation adjustments resulting are not included in determining net income but are included in foreign exchange adjustment to other comprehensive income, a component of equity.

Transactions in currencies other than the functional currencies during the period are converted into the applicable functional currencies at the applicable rates of exchange prevailing at the dates of the transactions. Exchange gains and losses are recognized in the statements of operations. The exchange rates utilized are as follows:

	As of and for the nine months ended April 30, 2021		As of and for the nine months ended April 30, 2020
Period-end CNY¥ : US$1 exchange rate		6.47		7.05
Period-average CNY¥ : US$1 exchange rate		6.61		7.01

	As of and for the three months ended October 31, 2021		As of and for the three months ended October 31, 2020
Period-end CNY¥ : US$1 exchange rate		6.39		6.58
Period-average CNY¥ : US$1 exchange rate		6.45		6.80

No representation is made that the RMB amounts could have been, or could be, converted into U.S. dollars at the rates used in translation.

Use of Estimates

The preparation of ~~condensed~~ consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions ~~that~~ that affect the reported amounts of assets and liabilities, related disclosures of contingent liabilities at the balance sheet date and ~~revenue~~ revenue and expenses in the ~~condensed~~ consolidated financial statements and accompanying notes. Significant accounting estimates reflected in the Company’s financial statements include the valuation allowance for deferred tax assets, economic lives and impairment of property, plant and equipment, allowance for doubtful accounts, etc. Actual results could differ from those estimates and such differences could affect the results of operations reported in future periods.

Fair Value Measurement

Accounting Standards Codification (“ASC”) 820 “Fair Value Measurements and Disclosures,” which defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. The statement clarifies that the exchange price is the price in an orderly transaction between market participants to sell the asset or transfer the liability in the market in which the reporting entity would transact for the asset or liability, that is, the principal or most advantageous market for the asset or liability. It also emphasizes that fair value is a market-based measurement, not an entity-specific measurement, and that market participant assumptions include assumptions about risk and effect of a restriction on the sale or use of an asset.

This ASC establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described below:

Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;

Level 2: Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability; and

Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity).

At ~~April~~October 3031, 2021, the Company has no financial assets or liabilities subject to recurring fair value measurements. The Company’s financial instruments include cash, accounts receivable, advances to suppliers, other receivables, held for sale assets, accounts payable, other payables, taxes payable and related party receivables or payables. Management estimates that the carrying amounts of financial instruments approximate their fair values due to their short-term nature. The fair value of amounts with related parties is not practicable to estimate due to the related party nature of the underlying transactions.

Cash and Cash Equivalents

The Company considers all highly liquid investments purchased with original maturities of three months or less to be cash equivalents. All cash and cash equivalents relate to cash on hand and cash at the bank as of ~~April~~October 3031, 2021 and July 31, ~~2020~~2021.

The RMB is not freely convertible into foreign currencies. Under the PRC Foreign Exchange Control Regulations and Administration of Settlement, Sales and Payment of Foreign Exchange Regulations, the Company is permitted to exchange RMB for foreign currencies through banks that are authorized to conduct foreign exchange business.

Accounts Receivable

Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of accounts receivable. The Company extends credit to its customers in the normal course of business and generally does not require collateral. The Company’s credit terms are dependent upon the segment, and the customer. The Company assesses the probability of collection from each customer at the outset of the arrangement based on a number of factors, including the customer’s payment history and its current creditworthiness. If in management’s judgment collection is not probable, the Company does not record revenue until the uncertainty is removed.

Management performs ongoing credit evaluations, and the Company maintains an allowance for potential credit losses based upon its loss history and its aging analysis. The allowance for doubtful accounts is the Company’s best estimate of the amount of credit losses in existing accounts receivable. Management reviews the allowance for doubtful accounts each reporting period based on a detailed analysis of trade receivables. In the analysis, management primarily considers the age of the customer’s receivable, and also considers the creditworthiness of the customer, the economic conditions of the customer’s industry, general economic conditions and trends, and the business relationship and history with its customers, among other factors. If any of these factors change, the Company may also change its original estimates, which could impact the level of the Company’s future allowance for doubtful accounts. If judgments regarding the collectability of receivables were incorrect, adjustments to the allowance may be required, which would reduce profitability.

Accounts receivable are recognized and carried at the original invoice amount less an allowance for any uncollectible amounts. An estimate for doubtful accounts receivable is made when collection of the full amount is no longer probable. Bad debts are written off as incurred. No allowance for doubtful accounts was made as of ~~April~~October 3031, 2021 and July 31, ~~2020~~2021.

Inventories

Inventories consist of raw materials and finished goods and are stated at the lower of cost, determined on a weighted average basis, or net realizable value. Net realizable value is the estimated selling price in the ordinary course of business less the estimated cost of completion and the estimated costs necessary to make the sale. When inventories are sold, their carrying amount is charged to expense in the period in which the revenue is recognized. Write-downs for declines in net realizable value or for losses of inventories are recognized as an expense in the period the impairment or loss occurs. The Company made no allowance for obsolete finished goods for the ~~nine~~three months ended ~~April~~October 3031, 2021 and the year ended July 31, ~~2020~~2021.

Held for sale assets

Held for sale assets are stated at the lower of their cost or fair value less cost to sell. A gain is recognized for any subsequent increase in fair value less cost to sell, but recognized gains may not exceed the cumulative losses previously recognized.

Property, plant and equipment

Property, plant and equipment are carried at cost less accumulated depreciation. Depreciation is provided over the assets’ estimated useful lives, using the straight-line method. Estimated useful lives of the property, plant and equipment are as follows:

Motor vehicles			4 years
Office equipment			3 years

Motor vehicles			4 to 10 years
Office equipment			3 years

The cost and related accumulated depreciation of assets sold or otherwise retired are eliminated from the accounts and any gain or loss is included in the statement of income. The cost of maintenance and repairs is charged to the statement of income as incurred, whereas significant renewals and betterments are capitalized.

Impairment of long-lived assets

The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may no longer be recoverable. Whenever there is an indication showing a permanent decrease in the amount of property, plant and equipment, such as an evidence of obsolescence or physical damage of an asset or significant changes in the manner in which an asset is used or is expected to be used, the Company shall recognize loss on decrease in value of property, plant and equipment in the statement of income where the carrying amount of the asset is higher than the recoverable amount. The Company measures impairment by comparing the carrying value of the long-lived assets to the estimated undiscounted future cash flows expected to result from the use of the assets and their eventual disposition. If the sum of the expected undiscounted cash flow is less than the carrying amount of the assets, the Company would recognize an impairment loss based on the fair value of the assets. The Company did not record any impairment losses on long-lived assets during the ~~nine~~three months ended ~~April~~October 3031, 2021 and the year ended July 31, ~~2020~~2021.

Operating leases

The Company determines if an arrangement contains a lease at inception. The Company elected the practical expedient, for all asset classes, to account for each lease component of a contract and its associated non-lease components as a single lease component, rather than allocating a standalone value to each component of a lease. For purposes of calculating operating lease obligations under the standard, the Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise such option. The Company’s leases do not contain material residual value guarantees or material restrictive covenants. Operating lease expense is recognized on a straight-line basis over the lease terms. The discount rate used to measure a lease obligation is usually the rate implicit in the lease; however, the Company’s operating leases generally do not provide an implicit rate. Accordingly, the Company uses its incremental borrowing rate at lease commencement to determine the present value of lease payments. The incremental borrowing rate is an entity-specific rate that represents the rate of interest a lessee would pay to borrow on a collateralized basis over a similar term with similar payments.

Revenue recognition

Recognition of revenue

Revenue is generated through the sale of goods and rendering services. Revenue is recognized when a customer obtains control of promised goods or services and is recognized in an amount that reflects the consideration that the Company expects to receive in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The amount of revenue that is recorded reflects the consideration that the Company expects to receive in exchange for those goods and services. The Company applies the following five-step model in order to determine this amount:

(i)

identification of the promised goods and services in the contract;

	(ii)	determination of whether the promised goods and services are performance obligations, including whether they are distinct in the context of the contract;

	(iii)	measurement of the transaction price, including the constraint on variable consideration;

	(iv)	allocation of the transaction price to the performance obligations; and

	(v)	recognition of revenue when (or as) the Company satisfies each performance obligation.

The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. Once a contract is determined to be within the scope of ASC 606 at contract inception, the Company reviews the contract to determine which performance obligations the Company must deliver and which of these performance obligations are distinct. The Company recognizes as revenues the amount of the transaction price that is allocated to the respective performance obligations when the performance obligation is satisfied or as it is satisfied. Generally, the Company’s performance obligations are transferred to customers at a point in time, typically upon delivery.

Contract liabilities

A contract liability is the obligation to transfer goods to a customer for which the Company has received consideration (or an amount of consideration is due) from the customer. If a customer pays consideration before the Company transfers goods or services to the customer, a contract liability is recognized when the payment is made or the payment is due (whichever is earlier). The Company’s contract liabilities comprise advances from customers, which are recognized as revenue when the Company performs under the contract. The balances of advances from customers as of ~~April~~October 3031, 2021 and July 31, ~~2020~~2021 are $~~Nil~~ 9,389 and $1$176,~~539,343~~465 respectively.

For all reporting periods, the Company has not disclosed the value of unsatisfied performance obligations for all service revenue contracts with an original expected length of one year or less, which is an optional exemption that is permitted under the adopted rules.

Other income and other expenses

Other income and other expenses are recognized on an accrual basis in accordance with the substance of the relevant agreements.

Research and development expenses

Research and development expenses include payroll, employee benefits and other operating expenses associated with research and platform development. To date, expenditures incurred between when the application has reached the development stage and when it is substantially complete and ready for its intended use have been inconsequential and, as a result, the Company did not capitalize any qualifying development costs in the accompanying ~~condensed~~ consolidated financial statements.

Earnings per share

The Company reports earnings per share in accordance with ASC 260 “Earnings Per Share,” which requires presentation of basic and diluted earnings per share in conjunction with the disclosure of the methodology used in computing such earnings per share. Basic earnings per share excludes dilution and is computed by dividing income available to common stockholders by the weighted average common shares outstanding during the reporting period. Diluted earnings per share takes into account the potential dilution that could occur if securities or other contracts to issue common stock were exercised and converted into common stock. Further, if the number of common shares outstanding increases as a result of a stock dividend or stock split or decreases as a result of a reverse stock split, the computations of a basic and diluted earnings per share shall be adjusted retrospectively for all periods presented to reflect that change in capital structure.

The Company’s basic earnings per share is computed by dividing the net income available to holders by the weighted average number of the Company’s ordinary shares outstanding. Diluted earnings per share reflects the amount of net income available to each ordinary share outstanding during the period plus the number of additional shares that would have been outstanding if potentially dilutive securities had been issued. The Company had no potentially dilutive shares as of ~~April~~October 3031, 2021.

Share capital

Incremental costs directly attributable to the issue of shares are recognized as a deduction from equity.

Related party balances and transactions

A related party is generally defined as:

(i) any person that holds the Company’s securities, including such person’s immediate family,

(ii) the Company’s management,

(iii) someone that directly or indirectly controls, is controlled by or is under common control with the Company, or

(iv) anyone who can significantly influence the consolidated financial and operating decisions of the Company.

A transaction is considered to be a related party transaction when there is a transfer of resources or obligations between related parties.

Income taxes

The Company accounts for income taxes using the asset and liability method prescribed by ASC 740 “Income Taxes.” Under this method, deferred tax assets and liabilities are determined based on the difference between the consolidated financial reporting and tax bases of assets and liabilities using enacted tax rates that will be in effect in the year in which the differences are expected to reverse. The Company records a valuation allowance to offset deferred tax assets if based on the weight of available evidence, it is more-likely-than-not that some portion, or all, of the deferred tax assets will not be realized. The effect on deferred taxes of a change in tax rates is recognized as income or loss in the period that includes the enactment date.

The Company does not have any material unrecognized tax benefits.

The Company is governed by the Income Tax Laws of the PRC. The PRC federal statutory tax rate is 25%. The Company files income tax returns with the relevant government authorities in the PRC. The Company does not believe there will be any material changes in its unrecognized tax positions over the next 12 months.

The Company’s policy is to recognize interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense. The Company does not have any accrued interest or penalties associated with any unrecognized tax benefits, nor was any interest expense recognized during the ~~nine~~three months ended ~~April~~October 3031, 2021 and the ~~nine~~three months ended ~~April~~October 3031, 2020. The Company’s effective tax rate differs from the PRC federal statutory rate primarily due to non-deductible expenses, temporary differences and preferential tax treatment.

Recently issued and adopted accounting pronouncements

In June 2016, the FASB issued ASU 2016-13, “Financial Instruments — Credit Losses (Topic 326), Measurement of Credit Losses on Financial Statements.” This ASU requires a financial asset (or group of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial asset(s) to present the net carrying value at the amount expected to be collected on the financial asset. This Accounting Standards Update affects entities holding financial assets and net investment in leases that are not accounted for at fair value through net income. The amendments affect loans, debt securities, trade receivables, net investments in leases, off balance sheet credit exposures, reinsurance receivables and any other financial assets not excluded from the scope that have the contractual right to receive cash. For public business entities, the amendments in this Update are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. All entities may adopt the amendments in this Update through a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective (that is, a modified-retrospective approach). The Company is in the process of evaluating the impact of the adoption of this pronouncement on its financial statements.

The Company reviews new accounting standards as issued. Management has not identified any other new standards that it believes will have a significant impact on the Company’s financial statements.

NOTE 3. OTHER RECEIVABLES

Other receivables consisted of the following:

	April 30, 2021		July 31, 2020
Rental deposit	$	53,930	$	49,934
Pending input VAT	$	59,894	$	17,378
Prepaid legal service fee	$	21,000	$	-
Advance for R&D service fee		466,797
Others	$	681,186	$	25,755
Total	$	1,282,807	$	93,067

SUMMARY OF OTHER RECEIVABLES

	October 31, 2021		July 31, 2021
Rental deposit	$	54,576	$	53,989
Pending input VAT	$	1,390	$	74,340
Prepaid legal service fee	$	50,000	$	5,250
Advance for R&D service fee	$	118,096	$	292,064
Others	$	166,359	$	54,096
Total	$	390,421	$	479,739

The Company leases an office and paid an amount equal to two months’ rent as a security deposit.

On April 22, 2021, the Company prepaid $~~466~~118,~~797~~096 to ~~the~~a third party ~~Shenzhen~~for ~~Rubao~~a ~~Technology~~research ~~Co.,~~and ~~Ltd~~development ~~for R&D~~ project on the ~~packbag~~backpack. ~~The project is expected to be completed in December of 2021.~~

On April 29, 2021, the Company lend out $618,506 to the third party Shenzhen Kaishengwei Technology Co., Ltd without any interest or secured and the Company received the full amount at June 1, 2021.

NOTE 4. INVENTORIES

Inventories consist of the following:

	April 30, 2021		July 31, 2020
Raw materials	$	95,990	$	520,972
Finished goods	$	97,089	$	691,409
Total inventories	$	193,079	$	1,212,381

SCHEDULE OF INVENTORY

There is no inventory allowance for the nine months ended April 30, 2021 and the year ended July 31, 2020.

	October 31, 2021		July 31, 2021
Raw materials	$	324,622	$	138,852
Finished goods	$	197,425	$	97,194
Total inventories	$	522,047	$	236,046

There is no inventory allowance for the three months ended October 31, 2021 and the year ended July 31, 2021.

NOTE 5. HELD FOR SALE ASSETS

Held for sale assets relate to IT servers acquired during the year ended July 31, ~~2020~~2021. ~~Management~~On ~~plans~~May 10, 2021, the Company entered into a contract with Mr. Zhao Lixin, the Company’s CEO, to sell these IT servers byto ~~end~~him offor $2,554,100. The IT servers were delivered to Mr. Zhao ~~July~~on August 10, 2021.

NOTE 6. DOWN PAYMENTS TO SUPPLIERS

The Company has made advances to third-party suppliers. These advances are down payments according to the purchase agreements made to expedite the delivery and preferential prices for the materials and the parts for the goods that the Company sells.

NOTE 7. PROPERTY, PLANT AND EQUIPMENT

	April 30, 2021			July 31, 2020
Motor vehicles	$	377,341		$	204,654
Office equipment	$	48,106		$	28,252
Less: accumulated depreciation	$	(88,126	)	$	(28,803	)
Total	$	337,321		$	204,103

During the nine months ended April 30, 2021, the Company acquired 1 motor vehicle costing $156,309 and office equipment consisting of 4 notebook computers, costing an aggregate of $4,209, and 3 desktop computers, costing an aggregate of $1,880, and 1 digital camera, costing $2,085, and 10 cell phones, costing an aggregate of $9,419, for a total cost of $173,902. Depreciation expense for the nine months ended April 30, 2021 and nine months ended April 30, 2020 was $59,323 and $14,530, respectively.

	October 31, 2021			July 31, 2021
Motor vehicles	$	1,955,200		$	402,957
Office equipment	$	51,962		$	50,534
Less: accumulated depreciation	$	(167,443	)	$	(115,610	)
Total	$	1,839,718		$	337,881

During the three months ended October 31, 2021, the Company acquired a motor vehicle costing $1,547,861 and office equipment consisting of 1 desktop computers, costing $878, for a total cost of $1,548,739. Depreciation expense for the three months ended October 31, 2021 and the year ended July 31, 2021 was $50,127 and $$83,134, respectively.

NOTE 8. INCOME TAXES

Enterprise income tax (“EIT”)

The Company was incorporated under the laws of the State of Nevada and is subject to the United States federal income tax. No provision for income taxes in the United States has been made as the Company had no United States taxable income for the ~~nine~~three months ended ~~April 30,~~October 31, 2021 and the year ended July 31, ~~2020~~2021.

The Company operates in the PRC and files tax returns in PRC jurisdictions.

The Company’s subsidiary formed in the Independent State of Samoa is not subject to tax on its income or capital gains. In addition, upon payment of dividends by the Company to its shareholders, no withholding tax is imposed.

The Company’s subsidiary formed in Hong Kong is subject to a profits tax rate of 16.5% for income generated and operation in the special administrative region.

The Company operates in the PRC and files tax returns in PRC jurisdictions. Income generated and operations in the PRC are subject to a tax rate of 25%.

The full realization of the tax benefit associated with a carry forward depends predominantly upon the Company’s ability to generate taxable income during the carry forward period.

In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. A valuation allowance is provided for deferred tax assets if it is more likely than not these items will either expire before the Company is able to realize their benefits, or that future deductibility is uncertain.

The reconciliation of income taxes computed at the PRC federal statutory tax rate applicable in the PRC, to income tax expenses are as follows:

	For the nine months ended April 30, 2021			For the year ended July 31, 2020
PRC statutory tax rate		25	%		25	%
Expenses not deductible		1	%		0.0	%
Valuation allowance		12	%		0.2	%
Income tax expense		38	%		25.2	%

	For the nine months ended April 30, 2021			For the year ended July 31, 2020
	For the three months ended October 31, 2021			For the year ended July 31, 2021
PRC statutory tax rate		25	%		25	%
Computed expected (expenses)/benefits	$	347,272		$	1,034,709
Expenses not deductible		-	%		3	%
Expenses not deductible	$	12,468		$	2,833
Valuation allowance		(24	)%		46	%
Valuation allowance	$	171,390		$	6,596
Income tax expense		1	%		74	%
Income tax expense	$	531,130		$	1,044,138

	For the three months ended October 31, 2021			For the year ended July 31, 2021
PRC statutory tax rate		25	%		25	%
Computed expected (expenses)/benefits	$	(70,636	)	$	153,926
Expenses not deductible	$	596		$	18,190
Valuation allowance	$	70,636		$	282,959
Income tax expense	$	596		$	455,075

Value added tax (“VAT”)

Pursuant to the Provisional Regulations on Value-Added Tax of the PRC and its implementation regulations, unless otherwise stipulated by relevant laws and regulations, any entity or individual engaged in the sales of goods, provision of processing, repairs and replacement services and importation of goods into China is generally required to pay a value-added tax, or VAT, for revenues generated from sales of products, while qualified input VAT paid on taxable purchases can be offset against such output VAT.

According to the Announcement on Relevant Policies for Deepening Value-added Tax Reform jointly promulgated by the Chinese Ministry of Finance, the State Administration of Taxation and the General Administration of Customs, which became effective on April 1, 2019, the taxable goods previously subject to VAT rates of 16% and 10%, respectively, become subject to lower VAT rates of 13% and 9% respectively starting from April 1, 2019. Our sales of goods are subject to VAT rates of 13%.

NOTE 9. RELATED PARTIES TRANSACTIONS

The Company had the following balances with related parties:

(a) Amount due from related parties

	Relationship	For the ~~nine~~three months ended ~~April~~October 3031, 2021		For the year ended July 31, ~~2020~~2021
Hang Zhou Huo Bao Bao AD and Media Co. Ltd.	Common shareholder of Winning Match Int’l Co., Ltd which is one of the shareholders of Mu Yan Samoa	$	~~139~~140,~~164~~830	$	~~214~~139,~~752~~315
Bang Bi Tuo (Shen Zhen) Technology Co., LTD.	Mr Zhao Lixin, CEO of this entity	$	~~451~~169,~~556~~773	$	~~859~~232,~~008~~158

The balances with related parties are unsecured, non-interest bearing and repayable on demand.

(b) Amount due to a related party

		For the nine months ended April 30, 2021		For the year ended July 31, 2020
		For the three months ended October 31, 2021		For the year ended July 31, 2021
Wang Zhen	He is one of the shareholders	$	-	$	64,645
Zhao Lixin	Mr Zhao Lixin, CEO of this entity	$	-	$	2,554,100

The balance with related party is unsecured, non-interest bearing and repayable on demand.

Trade in nature	For the ~~nine~~three months ended ~~April~~October 3031, 2021		For the year ended July 31, ~~2020~~2021
Purchase products from Hang Zhou Huo Bao Bao AD and Media Co. Ltd.	$	-	$	569,058
Service provided by Hang Zhou Huo Bao Bao AD and Media Co. Ltd.	$	-	$	91,410
Service provided by Hang Zhou Huo Bao Bao AD and Media Co. Ltd.	$	90,790	$	-
Cash advance to related parties
Bang Bi Tuo (Shen Zhen) Technology Co., Ltd.	$	~~139~~22,~~258~~516	$	~~859~~228,~~008~~493
Hang Zhou Huo Bao Bao AD and Media Co. Ltd.	$	-	$	214,752
Wang Zhen	$	115,818	$	-
Repayment from related parties
Bang Bi Tuo (Shen Zhen) Technology Co., Ltd.	$	~~605~~86,~~270~~849	$	-914,099
Wang Zhen	$	115,818	$	-
Cash advance from related parties
Wang Zhen	$	-	$	797,856
Repayment to related parties
Wang Zhen	$	64,645	$	733,614

NOTE 10. RESERVES

Statutory reserve

In accordance with the relevant laws and regulations of the PRC, the company established in the PRC is required to transfer 10% of its annual profit after taxation prepared in accordance with the accounting regulations of the PRC to the statutory reserve until the reserve balance reaches 50% of the company’s paid-up capital. Such reserves may be used to offset accumulated losses or increase the registered capital of the company, subject to the approval from the PRC authorities, and are not available for dividend distribution to the shareholders. There is $485,415 and ~~Nil~~$485,415 reserve provided for the ~~nine~~three months ended ~~April~~October 3031, 2021 and the year ended July 31, ~~2020~~2021, respectively.

Currency translation reserve

The currency translation reserve represents translation differences arising from translation of foreign currency financial statements into the Company’s functional currency.

NOTE 11. LEASES

In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842).” The guidance supersedes existing guidance on accounting for leases with the main difference being that operating leases are to be recorded in the statement of financial position as right-of-use assets and lease liabilities, initially measured at the present value of the lease payments. For operating leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election not to recognize lease assets and liabilities. For public business entities, the guidance is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early application of the guidance is permitted. In transition, entities are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. Effective July 1, 2020, the Company adopted this standard, resulting in the recognition of right-of-use assets of $~~350~~206,~~082~~114 and operating lease liabilities of $~~350~~206,~~082~~114.

The adoption of the new lease guidance did not have a material impact on the Company’s results of operations or liquidity, but resulted in the recognition of operating lease liabilities and operating lease right-of-use assets on its balance sheets. Right-of-use (“ROU”) assets represent the right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make lease payments arising from the lease. ROU assets and liabilities are recognized at the lease commencement date based on the estimated present value of lease payments over the lease term. The Company has a lease for the office in Shenzhen, PRC, under an operating lease expiring in June 2022, which is classified as an operating lease. There are no residual value guarantees and no restrictions or covenants imposed by the lease. Rent expense for the ~~nine~~three months ended ~~April~~October 3031, 2021 and the ~~nine~~three months ended ~~April~~October 3031, 2020 were $~~218~~78,~~578~~679 and $~~Nil~~$70,153, respectively. Cash paid for the operating lease was included in the operating cash flows.

There are no residual value guarantees and no restrictions or covenants imposed by the lease. As of ~~April~~October 3031, 2021, the Company has $~~350~~206,~~082~~114 of right-of-use assets, $~~298~~206,~~558~~114 in current operating lease liabilities and $~~51,524~~Nil in non-current operating lease liabilities.

Significant assumptions and judgments made as part of the adoption of this new lease standard include determining (i) whether a contract contains a lease, (ii) whether a contract involves an identified asset, and (iii) which party to the contract directs the use of the asset. The discount rates used to calculate the present value of lease payments were determined based on hypothetical borrowing rates available to the Company over terms similar to the lease terms.

The Company’s future minimum payments under long-term non-cancelable operating leases are as follows:

	April 30,2021
Within 1 year	$	308,786
After 1 year but within 5 years	$	51,830
Total lease payments	$	360,616
Less: imputed interest	$	(10,534	)
Total lease obligations	$	350,082
Less: current obligations	$	(298,558	)
Long-term lease obligations	$	51,524

	October 31,2021
Within 1 year	$	209,802
After 1 year but within 5 years	$	-
Total lease payments	$	209,802
Less: imputed interest	$	(3,688	)
Total lease obligations	$	206,114
Less: current obligations	$	(206,114	)
Long-term lease obligations	$	-

Other information:

	For the nine months ended
	April 30, 2021			April 30, 2020
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flow from operating lease	$	223,357		$	-
Right-of-use assets obtained in exchange for operating lease liabilities	$	350,082		$	-
Remaining lease term for operating lease (years)		1			-
Weighted average discount rate for operating lease		4.75	%		-

NOTE 12. CONSOLIDATED SEGMENT DATA

	For the three months ended
	October 31, 2021			October 31, 2020
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flow from operating lease	$	78,676		$	71,618
Right-of-use assets obtained in exchange for operating lease liabilities	$	206,114		$	470,135
Remaining lease term for operating lease (years)		1			2
Weighted average discount rate for operating lease		4.75	%		4.75	%

~~Segment~~NOTE ~~information is consistent with how chief operating decision maker reviews the businesses, makes investing and resource allocation decisions and assesses operating performance~~12. ~~The~~SUBSEQUENT ~~segment data presented reflects this segment structure. The Company reports financial and operating information in the following four segments:~~EVENTS

(a) Mobile advertisement backpack. Including manufacturing and distribution of backpacks; (b) Advertising services. Providing logistic services;

Selected information in the segment structure is presented in the following tables:

Revenues by segment for the three and nine months ended April 30, 2021 and 2020 are as follows:

	Three months ended April 30,				Nine months ended April 30,
Revenues	2021		2020		2021		2020
Mobile advertisement backpack	$	53,456	$	1,709,292	$	5,886,116	$	4,798,863
Advertising services	$	6,313	$	-	$	332,620	$	-
Total of reportable segments and consolidated revenue	$	59,769	$	1,709,292	$	6,218,736	$	4,798,863

Income from operations by segment for the three and nine months ended April 30, 2021 and 2020 are as follows:

	Three months ended						Nine months ended
	April 30,						April 30,
	2021			2020			2021			2020
Mobile advertisement backpack	$	31,982		$	1,153,279		$	3,342,794		$	3,046,329
Advertising services	$	4,092		$	-		$	259,448		$	-
Total of reportable segments	$	36,074		$	1,153,279		$	3,602,242		$	3,046,329
Reconciliation – Corporate	$	(566,311	)	$	(230,809	)	$	(2,213,154	)	$	(879,331	)
Total consolidated profit(loss) from operations	$	(530,237	)	$	922,470		$	1,389,088		$	2,166,998

Total assets by segment as at April 30, 2021 and July 31, 2020 are as follows:

Total assets	April 30, 2021		July 31, 2020
Mobile advertisement backpack	$	3,342,794	$	4,138,837
Advertising services		259,448		-
Total of reportable segments	$	3,602,242	$	4,138,837
Reconciliation – Corporate		2,205,214		2,079,676
Consolidated total assets	$	5,807,456	$	6,218,513

NOTE 13. SUBSEQUENT EVENTS

No subsequent events.

2019

Item 2. Management’s discussion and analysis of financial condition and results of operation

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and the related notes included elsewhere in this report. Our consolidated financial statements have been prepared in accordance with U.S. GAAP. In addition, our consolidated financial statements and the financial data included in this Quarterly Report reflect our reorganization and have been prepared as if our current corporate structure had been in place throughout the relevant periods. The following discussion and analysis contain forward-looking statements that involve risks and uncertainties. Actual results could differ materially from those projected in the forward-looking statements.

Overview

The Company was originally incorporated in Nevada under the name “Lepota Inc.” on December 9, 2013. It maintains its principal executive offices at Room 1703B, Zhongzhou Building, No. 3088 Jintian Road, Futian District, Shenzhen City, Guangdong Province, People’s Republic of China 518000. The Company was formed for the purpose of importing and distributing cosmetics into the Russian Federation.

The Company filed a registration statement on Form S-1 with the SEC on September 18, 2014, which was declared effective on May 4, 2016. However, because the Company did not identify a viable business model or engage in any business prior to the share exchange discussed below, it was a shell company until August 12, 2020.

On February 18, 2020, as a result of a private transaction, 5,000,000 shares of the Company’s Common Stock were transferred from Rene Lawrence, its controlling shareholder, to certain purchasers (the “Purchasers”), with Zhao Lixin, the Company’s current CEO, becoming a 53.8% holder of the voting rights of the Company, and the Purchasers becoming the controlling shareholders. As a result of the change of control, Iurii Iurtaev resigned as the Company’s president, chief executive officer, chief financial officer and director and Rene Lawrence resigned as the Company’s secretary. Zhao Lixin was then named President, Chief Executive Officer, Chief Financial Officer, Treasurer, Secretary and Chairman of the Board of Directors of the Company.

On August 12, 2020 (the “Closing Date”), the Company closed on a share exchange (the “Share Exchange”) with Mu Yan Technology Holding Co., Limited, a limited liability company incorporated in Samoa (“Mu Yan Samoa”), and the holders of 100% of the outstanding shares of Mu Yan Samoa’s common stock (the “Mu Yan Shareholders”). As a result, Mu Yan Samoa is now a wholly owned subsidiary of the Company. Under the Share Exchange Agreement, the Mu Yan Shareholders exchanged 100% of the outstanding shares of Mu Yan Samoa’s common stock for 300,000,000 shares of the Company’s Common Stock. As a result of the Share Exchange, effective September 22, 2020, the Company’s name was changed to Mu Yan Technology Group Co., Limited.

For accounting purposes, the Share Exchange was treated as a recapitalization of the Company with Mu Yan Samoa as the acquirer. When we refer in this Quarterly Report to business and financial information for periods prior to the consummation of the Share Exchange, we are referring to the business and financial information of Mu Yan Samoa unless the context suggests otherwise.

2120

As a result of the closing of the Share Exchange, the Mu Yan Shareholders own approximately 98% of the total outstanding common shares of the Company and the former shareholders of the Company own approximately 2%. The shares issued to the Mu Yan Shareholders in connection with the Share Exchange were not registered under the Securities Act in reliance upon the exemption from registration provided by Section 4(a)(2) of the Securities Act, which exempts transactions by an issuer not involving any public offering. These securities may not be offered or sold absent registration or an applicable exemption from the registration requirement.

As a result of the recapitalization described above, management of the Company believes that the Company is no longer a shell company. The Company’s operations now consist of the operations of Mu Yan Samoa and its subsidiaries.

An outbreak of respiratory illness caused by a novel coronavirus (“COVID-19”) first emerged in Wuhan city, Hubei province, China in late 2019 and has continued to expand within the PRC and globally. Since our operating subsidiary, Mu Yan Shenzhen, was formed in September 2019 and did not commence sales of our products until January 2020, we have no comparable revenue data for the prior nine month period ended April 30, 2020, making it impossible to quantify or accurately assess the impact of the COVID-19 pandemic on our revenues for the nine month period ended April 30, 2021. However, management believes that the pandemic did negatively impact our results of operations and anticipates that the ongoing pandemic will also have a negative effect on the Company’s results of operations for the 2021 fiscal year, and possibly longer.

Throughout the remainder of this Quarterly Report, when we use phrases such as “we,” “our,” “Company” and “us,” we are referring to the Company and all of its subsidiaries, as a combined entity.

~~Results~~China ofPolitical ~~Operations for the three months ended April 30, 2021~~ and ~~2020~~Economic Risks

The ~~following~~Company’s ~~summarizes~~operations ~~our~~are conducted in the PRC. Accordingly, the Company’s business, financial condition and results of operations may ~~for~~be influenced by the ~~three~~political, ~~months~~economic ~~ended~~and ~~April~~legal ~~30,~~environment ~~2021~~in the PRC and ~~2020.~~by ~~The~~the ~~table~~general ~~and~~state of the ~~discussion~~PRC ~~below~~economy. Because all ~~should~~of beour ~~read~~operations are conducted in ~~conjunction~~the ~~with~~PRC through our ~~financial~~wholly-owned ~~statements~~subsidiaries, the Chinese government may exercise significant oversight and discretion over the ~~notes~~conduct ~~thereto~~of ~~appearing~~our ~~elsewhere~~business and may intervene in ~~this~~or ~~Quarterly~~influence ~~Report~~our operations at any time, which could result in a material change in our operations and/or the value of our shares.

Recently, the PRC government initiated a series of regulatory actions and made a number of public statements on the regulation of business operations in the PRC with little advance notice, including cracking down on illegal activities in the securities market, enhancing supervision over PRC-based companies listed overseas using a variable interest entity structure, adopting new measures to extend the scope of cybersecurity reviews, and expanding efforts in anti-monopoly enforcement. We do not believe that we are directly subject to these regulatory actions or statements, as we do not have a variable interest entity structure and our business does not involve the collection of user data, implicate cybersecurity, or involve any other type of restricted industry. Because these statements and regulatory actions are new, however, it is highly uncertain how soon legislative or administrative regulation making bodies in the PRC will respond to them, or what existing or new laws or regulations will be modified or promulgated, if any, or the potential impact such modified or new laws and regulations will have on our daily business operations or our ability to accept foreign investments and list on an U.S. exchange.

The structure of cash flows within our organization, and as summary of the applicable regulations, is as follows:

1. Our equity structure is a direct holding structure, that is, the overseas entity trading in the U.S., Mu Yan Technology Group Co., Limited (“Mu Yan Technology”), through our 100% owned Samoan subsidiary controls Mu Yan (Hong Kong) Technology Co., Limited (“Mu Yan Hong Kong”), which owns 100% of Mu Yan (Shenzhen) Media Technology Co., (“Mu Yan Shenzhen”) (the “WFOE”), which owns 100% of Mu Yan (Shenzen Digital Technology Co., Limited (“Mu Yan Digital).

2. Within our direct holding structure, the cross-border transfer of funds within our corporate group is legal and compliant with the laws and regulations of the PRC. After foreign investors’ funds enter Mu Yan Technology, the funds can be directly transferred to Mu Yan Hong Kong, and then to Mu Yan Shenzhen in the PRC and then transferred to subordinate operating entities through the WFOE.

If the Company intends to distribute dividends, the Company will transfer the dividends to Mu Yan Hong Kong in accordance with the laws and regulations of the PRC, and then Mu Yan Hong Kong will transfer the dividends to Mu Yan Technology, and the dividends will be distributed from Mu Yan Technology to all shareholders respectively in proportion to the shares they hold, regardless of whether the shareholders are U.S. investors or investors in other countries or regions.

3. In the reporting periods presented in this Form 10-Q, no cash and other asset transfers have occurred among the Company and its subsidiaries; and no dividends or distributions of a subsidiary has been made to the Company. For the foreseeable future, the Company intends to use any earnings for research and development, to develop new products and to expand its distribution and production capacity. As a result, we do not expect to pay any cash dividends.

4. Our PRC subsidiaries’ ability to distribute dividends is based upon their distributable earnings. Current PRC regulations permit our PRC subsidiaries to pay dividends to their respective shareholders only out of their accumulated profits, if any, determined in accordance with PRC accounting standards and regulations. In addition, each of our PRC subsidiaries is required to set aside at least 10% of its after-tax profits each year, if any, to fund a statutory reserve until such reserve reaches 50% of each of their registered capitals. These reserves are not distributable as cash dividends.

To address persistent capital outflows and the RMB’s depreciation against the U.S. dollar in the fourth quarter of 2016, the People’s Bank of China and the State Administration of Foreign Exchange, or SAFE, have implemented a series of capital control measures in the subsequent months, including stricter vetting procedures for PRC-based companies to remit foreign currency for overseas acquisitions, dividend payments and shareholder loan repayments. The PRC government may continue to strengthen its capital controls and our PRC subsidiaries’ dividends and other distributions may be subject to tightened scrutiny in the future. The PRC government also imposes controls on the conversion of RMB into foreign currencies and the remittance of currencies out of the PRC. Therefore, we may experience difficulties in completing the administrative procedures necessary to obtain and remit foreign currency for the payment of dividends from our profits, if any. Furthermore, if our subsidiaries in the PRC incur debt on their own in the future, the instruments governing the debt may restrict their ability to pay dividends or make other payments.

In addition, the Enterprise Income Tax Law and its implementation rules provide that a withholding tax at a rate of 10% will be applicable to dividends payable by Chinese companies to non-PRC-resident enterprises unless reduced under treaties or arrangements between the PRC central government and the governments of other countries or regions where the non-PRC resident enterprises are tax resident. Pursuant to the tax agreement between Mainland China and the Hong Kong Special Administrative Region, the withholding tax rate in respect to the payment of dividends by a PRC enterprise to a Hong Kong enterprise may be reduced to 5% from a standard rate of 10%. However, if the relevant tax authorities determine that our transactions or arrangements are for the primary purpose of enjoying a favorable tax treatment, the relevant tax authorities may adjust the favorable withholding tax in the future. Accordingly, there is no assurance that the reduced 5% withholding rate will apply to dividends received by our Hong Kong subsidiary from our PRC subsidiaries. This withholding tax will reduce the amount of dividends we may receive from our PRC subsidiaries.

Results of Operations for the three months ended October 31, 2021 and 2020

The following summarizes our results of operations for the three months ended October 31, 2021 and 2020. The table and the discussion below should be read in conjunction with our financial statements and the notes thereto appearing elsewhere in this Quarterly Report.

Revenue

Revenue generated from selling our mobile advertisement backpack contributed $53168,~~456~~235 and $14,~~709~~551,~~292~~255 to our total revenue for the three ~~months~~ months ended ~~April~~October 3031, 2021 and 2020, respectively. The decrease in revenue ~~generated~~for ~~by mobile advertisement backpack sales resulted from a suspension of sales during~~ the ~~quarter~~three ~~while~~months ~~the~~ended ~~Company~~October ~~worked~~31, on2021 ~~upgrading~~was ~~and~~due ~~updating~~to a ~~the~~significant ~~hardware~~decrease ~~and~~in the ~~software~~number ~~utilized~~of ~~in the~~ mobile advertisement backpack. ~~During~~sold during the three months ended ~~April~~October 3031, 2021, weas ~~sold~~a 13result of ~~backpacks,~~the ~~whereas~~suspension ~~during~~of ~~the~~sales ~~three~~while ~~months~~the ~~ended April~~Company ~~30,~~worked ~~2020,~~on weupgrading ~~sold~~and ~~9,149.~~updating ~~The~~the hardware and the software ~~improvements~~utilized ~~are~~in ~~expected~~the tobackpacks as bewell ~~completed~~as ina ~~July~~shortage ofraw ~~2021~~materials.

Revenue generated from advertising services contributed $6,313 and $Nil to our total revenue for the three months ended April 30, 2021 and 2020, respectively. The increase in revenue from advertising services was due to the fact that the Company did not commence operations in this business segment until December 2020.

Total revenue for the three months ended April 30, 2021 and 2020 were $59,769 and $1,709,292, respectively.

Cost of Revenue

	Three months ended April 30,								Increase (decrease) in
	Three months ended October 31,								Increase (decrease) in
	2021				2020				2021 compared to 2020
	(In U.S. dollars, except for percentages)
Net revenue for mobile advertisement backpack	$	53168,~~456~~235	100.0	%	$	14,~~709~~551,~~292~~255	100.0	%	$	(14,~~655~~383,~~836~~020	)	(96.93	)%
Inventory	$	2125,~~474~~658	4015.23	%	$	~~556~~1,~~013~~955,934	3243.50	%	$	(~~534~~1,~~539~~930,276	)	(9698.17	)%
Total cost of revenue for mobile advertisement backpack	$	2125,~~474~~658	4015.23	%	$	~~556~~1,~~013~~955,934	3243.50	%	$	(~~534~~1,~~539~~930,276	)	(9698.17	)%
Gross profit for mobile advertisement backpack	$	31142,~~982~~577	5984.87	%	$	12,~~153~~595,~~279~~321	6757.50	%	$	(12,~~121~~452,~~297~~744	)	(9794.25	)%
Net revenue for advertising services	$	6,313	100.0	%	$	-	-		$	6,313		N/A
Labor	$	1,709	27.1	%	$	-	-		$	1,709		N/A
Marketing	$	512	8.1	%	$	-	-		$	512		N/A
Total cost of revenue for advertising services	$	2,221	35.2	%	$	-	-		$	2,221		N/A
Gross Profit for advertising services	$	4,092	64.8	%	$	-	-		$	4,092		N/A
Total cost of revenue	$	23,695	39.6	%	$	556,013	32.5	%	$	(532,317	)	(95.7	)%
Gross profit	$	36,074	60.4	%	$	1,153,279	67.5	%	$	(1,117,206	)	(96.9	)%

Cost of revenue for mobile advertisement backpack for the three months ended ~~April~~October 3031, 2021 and 2020 was $2125,~~474~~658 and $~~556~~1,~~013~~955,934 respectively. The significant decrease in cost of revenue ~~for our mobile advertisement backpack~~ was ~~due~~a toresult ~~the~~of ~~fact~~our ~~that~~having ~~the Company~~ sold ~~only~~207 13 mobile advertisement backpacks during the three months ended ~~April~~October 3031, 2021, compared to 911,~~149~~816 ~~mobile~~backpacks ~~advertisement~~having ~~backpacks~~been sold during the three months ended ~~April~~October 3031, 2020 ~~and, therefore, needed to purchase commensurately fewer components for assembly into backpacks~~.

For our mobile advertisement backpack business, we outsourced the assembly processes of our products to subcontractors, and we maintained stable relationships with them. We outsource our delivery services to two courier companies. Delivery fees are paid by the ultimate customers upon delivery of the products. We have not experienced difficulty in obtaining inventory for our business, and we believe we maintain good relationships with our suppliers.

Inventory costs for our mobile advertisement backpack business were 4015.23% of our total mobile advertisement backpack business revenue in the three months ended ~~April~~October 3031, 2021, compared with ~~32.5~~43% in the three months ended ~~April~~October 3031, 2020. The ~~increased~~decreased percentage was mainly due to anto ~~increase~~a 50% increment in the ~~purchase~~selling ~~cost~~price of ~~the~~our ~~inventory~~mobile advertisement backpacks due to a shortage of raw materials from September 2021 to October 2021.

Cost of revenue for advertising services for the three months ended April 30, 2021 and 2020 was $2,221 and $Nil respectively. The increase in cost of revenue for advertising services reflects that the Company did not commence operations in this business segment until December 2020.

Total cost of revenue for the three months ended April 30, 2021 was $23,695 compared with the amount of $556,013 for the three months ended April 30, 2020. Total cost of revenue as a percentage for the three months ended April 30, 2021 was 39.6%, compared with 32.5% for the three months ended April 30, 2020. Gross profit for the three months ended April 30, 2021 was 60.4% compared with 67.5% for the three months ended April 30, 2020. The reasons for the decrease in the total cost of revenue as a percentage of the revenue for three months ended April 30, 2021, compared to the comparable period in the prior year are described above.

Net Profit

	Three months ended						2021 compared to 2020
	April 30,			April 30,			Amount of			% of
	October 31,			October 31,			Amount of			% of
	2021			2020			Increase			Increase
Gross Profit for mobile advertisement backpack	$	31142,~~982~~577		$	12,~~153~~595,~~279~~321		$	(12,~~121~~452,~~297~~744	)		(9795	)%
Gross Profit for advertising services	$	4,092		$	-		$	4,092			N/A
Additional Tax	$	(3,426	)	$	(39,527	)	$	36,101			(91	)%
Additional Tax	$	(415	)	$	(4,552	)	$	4,137			(91	)%
Gross Profit	$	139,151		$	2,555,794		$	(2,416,643	)		(95	)%
Gross Profit	$	35,659		$	1,148,727		$	(1,113,068	)		(97	)%
Operating Expenses:
Selling and Marketing Expenses	$	(~~4,904~~525	)	$	(~~186~~141,~~885~~005	)	$	~~181~~140,~~981~~480			(97100	)%
General and Administrative Expenses	$	(~~465~~490,~~150~~421	)	$	(~~157~~326,~~276~~233	)	$	(~~307~~164,~~874~~188	)		~~196~~50	%
Research and Development Expenses	$	(74269,~~509~~349	)	$	(~~218~~86,~~193~~782	)	$	~~143~~(182,~~684~~567	)		~~(66~~210	%
Operating Expenses	$	(~~544~~760,~~563~~295	)	$	(~~562~~554,~~354~~020	)	$	17(206,~~791~~275	)		(337	%
Other Income, net	$	~~(21~~357,~~334~~920	)	$	~~336,097~~46		$	(357,~~431~~874	)		~~(106~~777,987	)%
Income from Operations	$	(~~530~~263,~~238~~224	)	$	~~922~~2,~~470~~001,820		$	(12,~~452~~265,~~708~~044	)		(~~157~~113	)%
Revenue Related Tax	$	(~~11,141~~596	)	$	(~~326~~506,~~330~~818	)	$	~~315~~506,~~189~~222			(97100	)%
Net Profit	$	(541,379	)	$	596,140		$	(1,137,519	)		(191	)%
Net (Loss) Profit	$	(263,820	)	$	1,495,002		$	(1,758,822	)		(118	)%

Gross profit ~~from~~for our ~~for~~ mobile advertisement backpack for the three months ended ~~April~~October 3031, 2021 and the three months ended ~~April~~October 3031, 2020 was $31139,~~982~~151 and $12,~~153~~555,~~279~~794, respectively. Gross profit margin for our mobile advertisement backpack for the three months ended October 31, 2021 and the three months ended October 31, 2020 were 84.7% and 57%, respectively. The decrease in gross profit was primarily due to the reduction in revenue that resulted from reduced sales while the Company worked on upgrading and updating the hardware and the software utilized in the mobile advertisement backpack. ~~Gross~~ ~~profit~~The ~~margin~~increase ~~for~~in ~~the~~gross ~~mobile~~profit ~~advertisement~~margin ~~backpack~~was ~~for~~principally ~~the~~due ~~three~~to ~~months~~the ~~ended~~selling ~~April~~price of ~~30, 2021 and~~ the ~~three~~backpacks ~~months~~was ~~ended~~increased ~~April 30,~~by ~~2020 were 59.8~~50% ~~and~~from ~~67.5%,~~September ~~respectively.~~2021 ~~Inventory~~to ~~decreased~~October ~~from~~2021, ~~December~~and ~~2020~~a asfurther ~~sales~~reduction ~~were~~in ~~suspended~~revenue ~~during~~that ~~the~~resulted ~~quarter~~from ~~ended~~reduced ~~April~~sales ~~30,~~while ~~2021,~~the toCompany ~~work~~worked on upgrading and updating the hardware and the software utilized in the mobile advertisement backpack. ~~Management~~ Management believes that, ~~when~~now that the upgrades and updates ~~are~~have been completed, the Company`’s dependence upon third party suppliers will decrease and unit savings in production will be realized.

Net (loss) profit for the three months ended ~~April~~October 3031, 2021 and the three months ended ~~April~~October 3031, 2020 were $(~~541~~263,~~379~~820) and $~~596~~1,~~140~~495, 002, respectively.

Selling and Marketing Expenses

Our selling and marketing expenses for the three months ended ~~April~~October 3031, 2021 and 2020 were $~~4,904~~525 and $~~186~~141,~~885~~005, respectively. Selling and marketing expenses during ~~the~~both ~~three~~of ~~months~~those ~~ended~~periods ~~April~~consisted ~~30, 2021 were comprised~~ primarily of marketing expenses. The decrease in selling and marketing expenses from ~~decrease~~the ~~during~~three months ended October 31, 2021 to the three months ended ~~April~~October 3031, ~~2021~~2020 was primarily attributable to a decrease in selling expenses related to our mobile advertisement backpack due to a reduction in sales ~~have~~of ~~been~~that ~~suspended~~product. ~~meanwhile~~During the three months ended October ~~Company~~31, ~~worked~~2021, onwe ~~upgrading~~sold ~~and~~207 ~~updating~~backpacks, whereas during the ~~appearance~~three ~~and~~months ~~application~~ended ~~program~~October of31, ~~the~~2020, ~~mobile~~we ~~advertisement~~sold ~~backpack~~11,816.

General and Administrative Expenses

Our general and administrative expenses for the three months ended ~~April~~October 3031, 2021 and 2020 were $~~465~~490,~~150~~421 and $~~157~~326,~~276~~233, respectively. General and administrative expenses consisted primarily of administrative payroll, office expense, depreciation charges and other office expenses that are not directly attributable to our revenues. The general and administrative expenses increase during the three months ended ~~April~~October 3031, 2021 was primarily attributable to ~~business~~the ~~entertainment~~increment ~~expense~~of ~~that~~administrative ispayroll ~~used~~for toprofessional ~~maintain~~managers ~~business~~and ~~relationship~~depreciation ~~with~~charges ~~cooperative~~in ~~partners~~Vehicle onand ~~mobile advertisement backpack while~~ the ~~Company~~Vehicle ~~worked~~maintenance onfee, ~~upgrading~~such ~~and~~as ~~updating~~vehicle ~~the~~insurance ~~hardware~~ and ~~the~~fuel ~~software utilized in the mobile advertisement backpack~~cost.

Research and Development Expenses

Our research and development expenses for the three months ended ~~April~~October 3031, 2021 and 2020 were $74269,~~509~~349 and $~~218~~86,~~193~~782, respectively. Research and development expenses consist primarily of researchers’ payroll and IT services expenses. The research and development expenses ~~decrease~~increase during the three months ended ~~April~~October 3031, 2021 was primarily attributable to ~~IT services expenses that is used to run research and development projects. Some of them have been completed while~~ the ~~Company worked on~~ upgrading and updating of the hardware and the software utilized in the Company’s mobile advertisement backpack. ~~The hardware and software improvements are expected to be completed in July of 2021.~~

Other Income

Other income in the three months ended October 31, 2021 was $357,920 compared to other income of $46 in the three months ended October 31, 2020. Other income in the three months ended October 31, 2021 was attributable to the sale of IT servers, acquired during the year ended July 31, 2021. On May 10, 2021, the Company entered into a contract with Mr. Zhao Lixin, the Company’s CEO, to sell these IT servers to him for $2,554,100. The IT servers were delivered to Mr. Zhao on Aug 10, 2021.

Income Taxes

Income tax for the three months ended ~~April~~October 3031, 2021 and 2020 were $~~11,141~~596 and $~~326~~506,~~330~~818, respectively.

Results of Operations for the nine months ended April 30, 2021 and 2020

The following summarizes our results of operations for the nine months ended April 30, 2021 and 2020. The table and the discussion below should be read in conjunction with our financial statements and the notes thereto appearing elsewhere in this Quarterly Report.

Revenue

Revenue generated from selling our mobile advertisement backpack contributed $5,886,116 and $4,798,863 to our total revenue for the nine months ended April 30, 2021 and 2020, respectively. The increase in mobile advertisement backpack revenue is due to the fact that the Company’s operating subsidiary was not formed until September 30, 2019 and sold 9,149 backpacks between then and April 30, 2020, whereas it sold 15,252 backpacks during the nine months ended April 30, 2021. The hardware and software improvements are expected to be completed in July of 2021.

Revenue generated from advertising services contributed $332,620 and $Nil to our total revenue for the nine months ended April 30, 2021 and 2020, respectively. The increase in revenue from advertising services was due to the fact that the Company did not commence operations in this business segment until December 2020.

Total revenue for the nine months ended April 30, 2021 and 2020 were $6,218,736 and $4,798,863, respectively.

Cost of Revenue

	Nine months ended April 30,								Increase (decrease) in 2021 compared to
	2021				2020				2020
	(In U.S. dollars, except for percentages)
Net revenue for mobile advertisement backpack	$	5,886,116	100.0	%	$	4,798,863	100.0	%	$	1,087,253	22.7	%
Inventory	$	2,543,322	43.2	%	$	1,752,534	36.5	%	$	790,788	45.1	%
Total cost of revenue for mobile advertisement backpack	$	2,543,322	43.2	%	$	1,752,534	36.5	%	$	790,788	45.1	%
Gross profit for mobile advertisement backpack	$	3,342,794	56.8	%	$	3,046,329	63.5	%	$	296,465	9.7	%
Net revenue for advertising services	$	332,620	100.0	%	$	-	-		$	332,620	N/A
Labor	$	8,472	2.5	%	$	-	-		$	8,472	N/A
Marketing	$	64,700	19.5	%	$	-	-		$	64,700	N/A
Total cost of revenue for advertising services	$	73,172	22.0	%	$	-	-		$	73,172	N/A
Gross profit for advertising services	$	259,448	78.0	%	$	-	-		$	259,448	N/A
Total cost of revenue	$	2,616,494	42.1	%	$	1,752,534	36.5	%	$	863,961	49.3	%
Gross profit	$	3,602,242	57.9	%	$	3,046,329	63.5	%	$	555,912	18.2	%

Cost of revenue for mobile advertisement backpack for the nine months ended April 30, 2021 and 2020 was $2,543,322 and $1,752,534 respectively. The significant increase in cost of revenue was a result of our having sold 15,252 mobile advertisement backpacks during the nine months ended April 30, 2021 compared to 9,149 backpacks having been sold during the nine months ended April 30, 2020.

Inventory costs for our mobile advertisement backpack business were 43.2% of our total mobile advertisement backpack business revenue in the nine months ended April 30, 2020, compared with 36.5% in the nine months ended April 30, 2020. The increased percentage was mainly due to a 50% reduction in the selling price of our mobile advertisement backpacks due to a promotion from September 2020 to November 2020.

Cost of revenue for advertising services for the nine months ended April 30, 2021 and 2020 was $73,172 and $Nil, respectively. The increase in cost of revenue for advertising services was due to the fact that the Company did not commence sales in this business segment until December 2020.

For our advertising services business, we outsource some of the business to our contractors. The labor fees represented approximately 2.5% and Nil of total cost of revenues for our advertising services segment for the nine months ended April 30, 2021 and 2020, respectively. The marketing fees represented approximately 19.5% and Nil of total cost of revenues for our advertising services segment for the nine months ended April 30, 2021 and 2020, respectively.

Labor costs for our advertising services business for the nine months ended April 30, 2021 were $8,472 compared with $Nil for the nine months ended April 30, 2020. Labor costs for our service business accounted for 2.5% of our total service revenue for the nine months ended April 30, 2021, compared with Nil for the nine months ended April 30, 2020.

Marketing costs for our advertising services business for the nine months ended April 30, 2021 were $64,700 compared with $Nil for the nine months ended April 30, 2020. Marketing costs for our service business accounted for 19.5% of our total service revenue for the nine months ended April 30, 2021, compared with Nil for the nine months ended April 30, 2020.

Total cost of revenue for the nine months ended April 30, 2021 was $2,616,494 compared with the amount of $1,752,534 for the nine months ended April 30, 2020. Total cost of revenue as a percentage for the nine months ended April 30, 2021 was 42.1%, compared with 36.5% for the nine months ended April 30, 2020. Gross profit for the nine months ended April 30, 2021 was 57.9% compared with 63.5% for the nine months ended April 30, 2020.

Net Profit

	Nine months ended						2021 compared to 2020
	April 30,			April 30,			Amount of			% of
	2021			2020			Increase			Increase
Gross Profit for mobile advertisement backpack	$	3,342,794		$	3,046,329		$	296,465			10	%
Gross Profit for advertising services	$	259,448		$	-		$	259,448			N/A
Additional Tax	$	(51,888	)	$	(13,620	)	$	(38,268	)		281	%
Gross Profit	$	3,550,354		$	3,032,709		$	517,645			17	%
Operating Expenses:
Selling and Marketing Expenses	$	(620,226	)	$	(479,265	)	$	(140,961	)		29	%
General and Administrative Expenses	$	(1,280,283	)	$	(510,431	)	$	(769,852	)		151	%
Research and Development Expenses	$	(244,985	)	$	(245,869	)	$	884			(0	)%
Operating Expenses	$	(2,145,494	)	$	(1,235,565	)	$	(909,929	)		74	%
Other Income, net	$	(15,772	)	$	369,854		$	(385,626	)		(104	)%
Income from Operations	$	1,389,088		$	2,166,998		$	(777,910	)		(36	)%
Revenue Related Tax	$	(531,130	)	$	(551,068	)	$	19,938			(4	)%
Net Profit	$	857,958		$	1,615,930		$	(757,972	)		(47	)%

Gross profit for mobile advertisement backpack for the nine months ended April 30, 2021 and the nine months ended April 30, 2020 were $3,342,794 and $3,046,329, respectively. Gross profit margin for our mobile advertisement backpack for the nine months ended April 30, 2021 and the nine months ended April 30, 2020 were 56.8% and 63.5% , respectively. The decrease in gross profit margin was principally due to a promotion in which the selling price of the backpacks was reduced by 50% from September 2020 to November 2020, and a further reduction in revenue that resulted from reduced sales while the Company worked on upgrading and updating the hardware and the software utilized in the mobile advertisement backpack. Management believes that when the upgrades and updates are completed the Company’s dependence upon third party suppliers will decrease and unit savings in production will be realized.

Gross profit for advertising services for the nine months ended April 30, 2021 and the nine months ended April 30, 2020 were $259,448 and $Nil , respectively. Gross profit margin for advertising services for the nine months ended April 30, 2021 and the nine months ended April 30, 2020 were 78% and Nil , respectively. The increase in gross profit margin for advertising services was due to the fact that the Company did not commence sales in this business segment until December 2020.

Net profit for the nine months ended April 30, 2021 and the nine months ended April 30, 2020 were $857,958 and $1,615,930, respectively.

Selling and Marketing Expenses

Our selling and marketing expenses for the nine months ended April 30, 2021 and 2020 were $620,226 and $479,265, respectively. Selling and marketing expenses during the nine months ended April 30, 2021 were comprised primarily of marketing expenses. The selling and marketing expenses increase during the nine months ended April 30, 2021 was primarily attributable to marketing expenses that is used for business publicity on mobile advertisement backpack. During the nine months ended April 30, 2021, we sold 15,252 backpacks, whereas during the nine months ended April 30, 2020, we sold 9,149.

General and Administrative Expenses

Our general and administrative expenses for the nine months ended April 30, 2021 and 2020 were $1,280,283 and $510,431, respectively. General and administrative expenses consisted primarily of administrative payroll, office expense, depreciation charges and other office expenses that are not directly attributable to our revenues. The general and administrative expenses increase during the nine months ended April 30, 2021 was primarily attributable to business entertainment expense that is used to maintain business relationship with cooperative partners on mobile advertisement backpack while the Company worked on upgrading and updating the hardware and the software utilized in the mobile advertisement backpack.

Research and Development Expenses

Our research and development expenses for the nine months ended April 30, 2021 and 2020 were $244,985 and $245,869, respectively. Research and development expenses consist primarily of researchers’ payroll and IT services expenses.

Income Taxes

Income tax for the nine months ended April 30, 2021 and 2020 were $531,130 and $551,068, respectively.

Summary of Cash Flows

Summary cash flows information for the ~~nine~~three months ended ~~April~~October 3031, 2021 and 2020 are as follow:

	April 30,
	October 31,
	2021			2020
	(In U.S. Dollars)
Net cash (used in) provided by operating activities	$	~~(137~~1,~~972~~009,628	)	$	~~615~~(719,~~197~~462	)
Net cash provided by financing activities	$	-		$	5,148
Net cash (used in) investing activities	$	(1,674,569	)	$	(2,339	)
Net cash (used in) investing activities	$	(170,180	)	$	(227,244	)

Net cash (used in) or provided by operating activities were $~~(137~~1,~~972)~~009,628 and $~~615~~(719,~~197~~462) for the ~~nine~~three months ended ~~April~~October 3031, 2021 and 2020, respectively. The cash ~~used~~provided inby operating activities during the ~~nine~~three months ended ~~April~~October 3031, 2021 was primarily attributable to other receivables inventories and ~~advances~~held ~~from~~for ~~customers~~sale assets.

Net cash used in investing activities during the ~~nine~~three months ended ~~April~~October 3031, 2021 was $~~170~~1,~~180~~674,569, consisting entirely from the acquisition of property, plant and equipment. Net cash used in investing activities during the ~~nine~~three months ended ~~April~~October 3031, 2020 was $~~227~~2,~~244~~339.

Net cash provided by or used in financing activities during the nine months ended April 30, 2021 was $Nil. Net cash provided by financing activities during the nine months ended April 30, 2020 was $5,148 and was derived entirely from the sale of common shares.

Financial Condition, Liquidity and Capital Resources

As of ~~April~~October 3031, 2021, we had cash on hand of $~~616~~437,~~108~~665, total current assets of $51,~~120~~700,~~053~~993 and current liabilities of $1439,~~510,012~~240. The Company had revenues of $6168,~~218,736~~235 and generated a net ~~profit~~loss of $~~857~~263,~~958~~820 for the ~~nine~~three months ended ~~April~~October 3031, 2021. We believe that our business can generate sufficient cash flows to support the growth of our business.

Concentration of Credit Risk

Financial instruments that potentially expose the Company to significant concentration of credit risk consist primarily of cash and cash equivalents and amount due from related parties. As of ~~April~~October 3031, 2021 and ~~April~~October 3031, 2020, substantially all of the Company’s cash and cash equivalents were deposited with financial institutions with high-credit ratings and quality. The Company did not have any clients constituting 10% or more of its net revenues for the ~~nine~~three months period ended ~~April~~October 3031, 2021 and the ~~nine~~three month period ended ~~April~~October 3031, 2020.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements (as that term is defined in Item 303(a)(4)(ii) of Regulation S-K) as of ~~April~~October 3031, 2021 that ~~have~~ have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

As a smaller reporting company, we are not required to respond to this item.

Item 4. Controls and Procedures.

Under the supervision and with the participation of our principal executive officer, Zhao Lixin, and principal financial officer, Feng Wanning, we conducted an evaluation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) and Rule 15d-15(e) promulgated under the Exchange Act, as of ~~April~~October 3031, 2021. Based on this evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were ineffective at such time to ensure that information required to be disclosed by us in the reports filed or submitted under the Exchange Act were recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Our principal executive officer and principal financial officer also concluded that our disclosure controls, which are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to management, were inappropriate to allow timely decisions regarding required disclosure.

2926

Based on management’s assessment, the Company determined that there were material weaknesses in its internal control over financial reporting as of ~~April~~October 3031, 2021. The material weaknesses identified were as follows:

● Due to the small size of the Company and the lack of an accounting and finance department or a sufficient number of experienced accounting and finance personnel, there were limited controls over information processing.

● There was an inadequate segregation of duties consistent with control objectives as management was composed of only three persons at ~~April~~October 3031, 2021, and there remains an issue with inadequate segregation of duties as of the date of filing this Quarterly Report. In ~~order~~ order to remedy this situation, we would need to hire additional managers and staff to provide greater segregation of duties. Currently, it it is not financially feasible to hire additional managers and staff to obtain optimal segregation of duties. Management will reassess ~~this~~ this matter on an ongoing basis to determine whether improvement in segregation of duties is feasible.

● The Company does not have a formal audit committee with a financial expert, and thus the Company lacks the Board of Directors oversight role within the financial reporting process.

● Although the financial statements and footnotes are reviewed by our management, we do not have formal policies and procedures necessary to adequately review significant accounting transactions and the accounting treatment of those transactions.

As a result of these material weaknesses, our management concluded that our internal control over financial reporting was not effective as of ~~April~~October 3031, 2021. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control over financial reporting that is less severe than a material weakness, yet important enough to merit attention by those responsible for oversight of the company’s financial reporting.

Evaluation of Internal Controls and Procedures

Management is responsible for establishing and maintaining adequate internal control over financial reporting. As defined in Rule 13a-15(f) under the Exchange Act, internal control over financial reporting is a process designed by, or under the supervision of, the Company’s principal executive, principal operating and principal financial officers, or persons performing similar functions, and effected by the Company’s Board of Directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America.

The Company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the Company’s assets; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of the Company’s management and directors; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.

3027

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Our management assessed the effectiveness of our internal control over financial reporting at ~~April~~October 3031, 2021, and determined that, as of ~~April~~October 3031, 2021, our internal control over financial reporting was not effective.

Changes in Internal Controls over Financial Reporting

There have been no changes to our internal controls over financial reporting that occurred during our last fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

3128

PART II — OTHER INFORMATION

Item 1. Legal Proceedings.

We are currently not involved in any litigation that we believe could have a material adverse effect on our financial condition or results of operations. There is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the executive officers of our Company, threatened against or affecting our Company, or our common stock, in which an adverse decision could have a material adverse effect.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

None

Item 3. Defaults Upon Senior Securities.

None

Item 4. Mine Safety Disclosures.

Not applicable

Item 5. Other Information.

None

Item 6. Exhibits.

Exhibit
Number		Description

31.1		Certification of Chief Executive Officer pursuant to Section 302(a) of the Sarbanes-Oxley Act
31.2		Certification of Chief Financial Officer pursuant to Section 302(a) of the Sarbanes-Oxley Act
32.1		Certification of Chief Executive Officer Under Section 1350 as Adopted Pursuant Section 906 of the Sarbanes-Oxley Act
32.2		Certification of Chief Financial Officer Under Section 1350 as Adopted Pursuant Section 906 of the Sarbanes-Oxley Act

3229

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: June 14, 2021	MU YAN TECHNOLOGY GROUP CO., LIMITED
Date: December 20, 2021	MU YAN TECHNOLOGY GROUP CO., LIMITED
	By:	/s/ ZHAO Lixin
		ZHAO Lixin, President
Date: June 14, 2021	By:	/s/ FENG Wanning
Date: December 20, 2021	By:	/s/ FENG Wanning
		FENG Wanning, Treasurer and CFO

3330

Filing Compare · Mu Yan Technology Group Co., Ltd