UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C.20549

FORM 10-Q

☒	Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended ~~June~~September 30, 2017

☐	Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from ___________to ___________.

Commission File Number 001-34998

~~SINO~~Hui Ying ~~FORTUNE~~Financial ~~HOLDING~~Holdings ~~CORPORATION~~Corporation

(Exact name of registrant as specified in its charter)

Nevada		35-2507568
(State or Other Jurisdiction of		(I.R.S. Employer
Incorporation or Organization)		Identification No.)

2299 West Yan’an Road, Shanghai Mart Tower

24th Floor, Room 2403, Changning District

Shanghai 200336, China

(Address of Principal Executive Offices including zip code)

+86 021-2357-0077

(Registrant’s Telephone Number, Including Area Code)

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act 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 ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every, Interactive Data File required to be submitted and posted 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 and post such files). Yes ☐ No ☒

Indicate by check mark ifwhether the ~~registrant~~ Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting 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~~accelerated ~~Filer~~filer ☐ Accelerated ~~Filer~~filer ☐ Non-~~Accelerated~~accelerated ~~Filer~~filer ☐ Smaller reporting company ☒ (Do not check if a smaller reporting company) Emerging Growth Company ☒

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 Securities Exchange Act).

Yes ☐ No ☒

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY

PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d)of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.

☐ Yes ☐ No

APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

The number of shares of common stock issued and outstanding as of ~~August~~November 10, 2017 is 72,364,178.

TABLE OF CONTENTS

PART I:FINANCIAL INFORMATION		3
Item 1 – Financial Statements (unaudited)		3
Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations		2223
Item 3 – Quantitative and Qualitative Disclosures about Market Risk		3341
Item 4 – Controls and Procedures		3341
PART II: OTHER INFORMATION		3543
Item 1 – Legal Proceedings		3543
Item 1A – Risk Factors		3543
Item 2 – Unregistered Sales of Equity Securities and Use Of Proceeds		3543
Item 3 – Defaults Upon Senior Securities		3543
Item 4 – Mine Safety Disclosures		3543
Item 5 – Other Information		3543
Item 6 – Exhibits		3543
Signatures		3644

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

SINO FORTUNE HOLDING CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
		June 30,			December 31,
		2017			2016
		(Unaudited)
ASSETS
Current assets
Cash and cash equivalents	$	21,731,270		$	8,561,695
Short-term investments		7,420,365			8,274,306
Accounts receivable		360,799			281,038
Short-term loans receivable		7,377,434			—
Prepayments		904,476			2,078,926
Deposit for business acquisition		1,409,091			—
Other receivables		3,780,801			792,849
Total current assets		42,984,236			19,988,814
Property and equipment - net		466,479			279,408
Intangible assets		14,543			17,745
Total assets	$	43,465,258		$	20,285,967
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable and accrued liabilities	$	426,713		$	227,895
Taxes payable		2,389,238			1,285,160
Deferred tax liability		10,732			16,673
Interest payable		146,098			—
Liabilities from risk reserve fund guarantee, without recourse to the Company		10,078,847			7,297,123
Other payables		626,578			219,911
Total current liabilities		13,678,206			9,046,762
Convertible notes payable		13,189,164			—
Total long-term liabilities		13,189,164			—
Total liabilities		26,867,370			9,046,762
Stockholders’ equity
Preferred stock, $0.001 par value, 10,000,000 shares authorized, none issued		—			—
Common stock, $0.001 par value, 598,000,000 shares authorized, 72,364,178 shares issued and outstanding as of June 30, 2017 and December 31, 2016		72,364			72,364
Additional paid-in capital		9,527,326			9,527,326
Retained earnings		7,196,519			2,310,480
Accumulated other comprehensive loss		(198,321	)		(670,965	)
Total stockholders’ equity		16,597,888			11,239,205
Total liabilities and stockholders’ equity	$	43,465,258		$	20,285,967

HUI YING FINANCIAL HOLDINGS CORPORATION

~~The~~(f/k/a SINO ~~accompanying~~FORTUNE ~~notes~~HOLDING ~~are~~CORPORATION anAND ~~integral part of these unaudited condensed consolidated financial statements.~~SUBSIDIARIES)

3CONDENSED CONSOLIDATED BALANCE SHEETS

SINO FORTUNE HOLDING CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE INCOME (LOSS)
(Unaudited)
	For The Three Months Ended June 30,						For The Six Months Ended June 30,
	2017			2016			2017			2016
Revenues	$	10,798,846		$	5,747,405		$	18,685,745		$	11,307,547
Operating expenses
Selling, general and administrative expenses		7,176,725			6,120,753			12,381,576			10,041,469
Business and related taxes		21,323			13,806			65,540			40,545
Depreciation		46,763			31,185			76,458			65,547
Total operating expenses		7,244,811			6,165,744			12,523,574			10,147,561
Income from Operations		3,554,035			(418,339	)		6,162,171			1,159,986
Other income (expenses)
Interest income		125,176			26,841			156,028			59,525
Interest expense and bank charges		(148,793	)		—			(150,540	)		(4,826	)
Realized gain on investments		217,041			—			217,041			—
Other		19,669			(23,212	)		17,444			(42,206	)
Total other income (expense)		213,093			3,629			239,973			12,493
Income (loss) before provision for income taxes		3,767,128			(414,710	)		6,402,144			1,172,479
Provision for income taxes		(874,377	)		—			(1,516,105	)		(121,489	)
Net income (loss)		2,892,751			(414,710	)		4,886,039			1,050,990
Other comprehensive income (loss)
Net unrealized gain on investments (net of tax effect)		32,198			—			32,198			—
Foreign currency translation adjustment		353,388			(48,536	)		440,446			(21,168	)
Total comprehensive income (loss)	$	3,278,337		$	(463,246	)	$	5,358,683		$	1,029,822
Net income (loss) per common share
Basic	$	0.04		$	(0.01	)	$	0.07		$	0.02
Diluted	$	0.04		$	(0.01	)	$	0.07		$	0.02
Weighted average number of common shares outstanding
Basic		72,364,178			67,500,000			72,364,178			67,500,000
Diluted		72,436,643			67,500,000			72,400,611			67,500,000

(Unaudited)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

	September 30,		December 31,
	2017		2016
ASSETS
Current assets
Cash and cash equivalents	$	12,942,309	$	8,561,695
Short-term investments		—		8,274,306
Accounts receivable		572,440		281,038
Short-term loans receivable		35,312,326		—
Prepayments		587,237		2,078,926
Other receivables		1,079,850		792,849
Total current assets		50,494,162		19,988,814
Property and equipment - net		792,133		279,408
Investment in an equity investee		2,870,067		—
Intangible assets		15,004		17,745
Total assets	$	54,171,366	$	20,285,967

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable and accrued liabilities	$	470,282	$	227,895
Taxes payable		4,002,070		1,285,160
Deferred tax liability		—		16,673
Interest payable		348,252		—
Due to related party		601,538		—
Liabilities from risk reserve fund guarantee, without recourse to the Company		13,101,290		7,297,123
Other payables		519,235		219,911
Total current liabilities		19,042,667		9,046,762

Convertible notes payable		13,189,164		—
Total long-term liabilities		13,189,164		—
Total liabilities		32,231,831		9,046,762

Stockholders’ equity
Preferred stock, $0.001 par value, 10,000,000 shares authorized, none issued		—		—
Common stock, $0.001 par value, 598,000,000 shares authorized, 72,364,178 shares issued and outstanding as of September 30, 2017 and December 31, 2016		72,364		72,364
Additional paid-in capital		9,527,326		9,527,326
Retained earnings		11,955,875		2,310,480
Accumulated other comprehensive loss		383,970		(670,965	)
Total stockholders’ equity		21,939,535		11,239,205
Total liabilities and stockholders’ equity	$	54,171,366	$	20,285,967

4 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

SINO FORTUNE HOLDING CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
	For The Six Months Ended June 30,
	2017			2016
Cash flows from operating activities:
Net income	$	4,886,038		$	1,050,990
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		76,458			65,547
Accrued interest on subscription funds for convertible notes		144,021			—
Realized Gain on investments		(217,041	)		—
Changes in operating assets and liabilities:
Accounts receivable		(71,786	)		—
Short-term loans receivable		(7,272,561	)		—
Prepayments		1,208,356			(912,708	)
Other receivables		38,417			(277,212	)
Accounts payable and accrued liabilities		191,220			(440,403	)
Taxes payable		1,057,101			474,185
Risk reserve fund payable		2,564,532			1,285,201
Other payable		395,565			—
Net cash provided by operating activities		3,000,320			1,245,600
Cash flows from investing activities:
Purchases of property and equipment		(250,479	)		(117,438	)
Payments made for short-term investments		(7,272,561	)		—
Repayments of short-term investments		8,507,761			—
Deposit for business acquisition		(1,389,061	)		—
Net cash used in investing activities		(404,340	)		(117,438	)
Cash flows from financing activities:
Proceeds from issuance of convertible notes		10,177,986			—
Net cash provided by financing activities		10,177,986			—
Effect of exchange rate change		395,609			(131,891	)
Cash and cash equivalents:
Net increase		13,169,575			996,271
Balance at beginning of period		8,561,695			5,712,741
Balance at end of period	$	21,731,270		$	6,709,012
Supplemental Disclosures of Cash flow Information:
Cash paid for interest expense	$	—		$	—
Cash paid for income taxes	$	398,593		$	—

~~The~~HUI YING ~~accompanying~~FINANCIAL ~~notes~~HOLDINGS ~~are an integral part of these unaudited condensed consolidated financial statements~~CORPORATION

5(f/k/a SINO FORTUNE HOLDING CORPORATION AND SUBSIDIARIES)

~~SINO~~CONDENSED CONSOLIDATED ~~FORTUNE~~STATEMENTS ~~HOLDING~~OF ~~CORPORATION~~OPERATIONS AND ~~SUBSIDIARIES~~ COMPREHENSIVE INCOME (LOSS)

~~NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~ (Unaudited)

JUNE 30, 2017

	For The Three Months Ended September 30,						For The Nine Months Ended September 30,
	2017			2016			2017			2016

Revenues:
Financing income from entrusted loans	$	636,449		$	—		$	636,449		$	—
Loan facilitation and repayment management fees and others		13,646,313			7,074,552			32,332,058			18,382,099
Total revenue		14,282,762			7,074,552			32,968,507			18,382,099

Operating expenses
Selling, general and administrative expenses		7,753,250			5,016,297			20,134,827			15,057,766
Business and related taxes		58,117			82,028			123,657			122,573
Depreciation		64,872			53,629			141,330			119,176
Total operating expenses		7,876,239			5,151,954			20,399,814			15,299,515

Income from Operations		6,406,523			1,922,598			12,568,693			3,082,584

Other income (expenses)
Interest income		27,237			23,657			183,265			83,182
Interest expense and bank charges		(339,300	)		(1,486	)		(489,840	)		(6,312	)
Realized gain on investments		93,752			—			310,793			—
Other		(23,702	)		17,016			(6,258	)		(25,190	)
Total other income (expense)		(242,013	)		39,187			(2,040	)		51,680

Income before provision for income taxes		6,164,510			1,961,785			12,566,653			3,134,264
Provision for income taxes		(1,405,154	)		(503,232	)		(2,921,258	)		(624,721	)
Net income		4,759,356			1,458,553			9,645,395			2,509,543

Other comprehensive income
Net unrealized gain on investments (net of tax effect)		(50,018	)		—			(50,018	)		—
Foreign currency translation adjustment		614,489			(24,158	)		1,104,953			(45,326	)
Total comprehensive income	$	5,323,827		$	1,434,395		$	10,700,330		$	2,464,217

Net income per common share
Basic	$	0.07		$	0.02		$	0.13		$	0.04
Diluted	$	0.06		$	0.02		$	0.13		$	0.04
Weighted average number of common shares outstanding
Basic		72,364,178			67,500,000			72,364,178			67,500,000
Diluted		78,958,760			67,500,000			74,594,599			67,500,000

~~Note~~The accompanying 1notes -are ~~Organization~~an ~~and~~integral ~~description~~part of ~~business~~these unaudited condensed consolidated financial statements.

Sino Fortune Holding Corporation (“Sino Fortune” or the “Company”) was incorporated in the State of Nevada on April 18, 2014 under the name Tapioca Corp. Effective April 18, 2016, we amended our name from Tapioca Corp. to Sino Fortune Holding Corporation. 4

~~On May 13, 2016, the Company entered into~~HUI aYING ~~share~~FINANCIAL ~~exchange~~HOLDINGS agreement (the “Share Exchange Agreement”) and on September 14, 2016, the Company entered into an amendment to the Share Exchange Agreement (the “Amendment”) with Benefactum Alliance Holdings Company Limited (“Benefactum Alliance”), a British Virgin Islands company, and all the shareholders of Benefactum Alliance, namely, Mr. Bodang Liu, Avis Genesis Inc. and Manor Goldie Inc. (each a “Shareholder” and collectively the “Shareholders”), to acquire all the issued and outstanding capital stock of Benefactum Alliance in exchange for the issuance to the Shareholders an aggregate of 337,500,000 restricted shares of our common stock (the “Reverse Merger”). The Reverse Merger closed on September 29, 2016. As a result, Benefactum Alliance became our wholly owned subsidiary and after the Reverse Merger, Sino Fortune had a total of 342,960,000 ( or 68,592,000 after considering the effect of 1:5 reverse stock split approved in June 2017) shares of common stock outstanding and former shareholders of Benefactum Alliance owned 98.41% of the issued and outstanding shares. CORPORATION

The acquisition of Benefactum Alliance was accounted for as a recapitalization effected by a share exchange, wherein Benefactum Alliance is considered the acquirer for accounting and financial reporting purposes (legal acquiree) with no adjustment to the historical basis of its assets and liabilities. Benefactum Alliance’s Shareholders become the majority shareholders and have control of the Company. Sino Fortune was f/k/a ~~non-operating~~ ~~public~~SINO ~~shell~~FORTUNE ~~prior~~HOLDING toCORPORATION ~~the~~AND ~~acquisition and as a result of the acquisition of Benefactum Alliance, the Company is no longer a shell company. Pursuant to Securities and Exchange Commission (“SEC”~~SUBSIDIARIES) rules, the merger or acquisition of a private operating company into a non-operating public shell with nominal net assets is considered a capital transaction in substance, rather than a business combination. The historical financial statements for periods prior to September 29, 2016 are those of Benefactum Alliance except that the equity section and earnings per share have been retroactively restated to reflect the recapitalization.

~~Benefactum Alliance is a holding company~~CONDENSED ~~incorporated~~CONSOLIDATED ~~under~~STATEMENTS ~~the~~OF ~~laws~~CASH of British Virgin Islands on March 15, 2016. On April 7, 2016, Benefactum Alliance incorporated Benefactum Sino Limited (“Benefactum Sino”) in Hong Kong SAR. Benefactum Sino, in turn, incorporated Benefactum Alliance (Shenzhen) Investment Consulting Company Limited (“Benefactum Shenzhen” or “WFOE”) in the People’s Republic of China (“PRC” or “China”) with a registered capital of RMB 100,000 on April 21, 2016. Benefactum Shenzhen entered into a series of contractual agreements with Benefactum Alliance Business Consultant (Beijing) Co., Ltd. (“Benefactum Beijing”), a company incorporated in the People’s Republic of China on September 10, 2013 with a registered capital of RMB 50,000,000. Benefactum Beijing is engaged in operating an electronic online financial platform, www.hyjf.com, as well as mobile apps, which are designed to match investors with small and medium-sized enterprises (“SMEs”) and individual borrowers in China and generate its revenue from services in connection with matching investors with these borrowers.FLOWS

6(Unaudited)

Due to PRC legal restrictions on foreign ownership and investment in, among other areas, value-added telecommunications services, which include internet content providers, or ICPs, we, similar to all other entities with foreign-incorporated holding company structures operating in our industry in China, have to operate our internet businesses and other businesses in which foreign investment is restricted or prohibited in the PRC through a series of contractual agreements between our WFOE and our operating entity of Benefactum Beijing. These agreements include Trademarks, Technologies & Management and Consulting Service Agreement; The Equity Interest Pledge Agreement; Exclusive Right and Option to Purchase Agreement; Equity Interest Holders’ Voting Rights Proxy Agreement.

	For The Nine Months Ended September 30,
	2017			2016
Cash flows from operating activities:
Net income	$	9,645,395		$	2,509,543
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		141,330			119,176
Accrued interest for convertible notes		348,252			—
Changes in operating assets and liabilities:
(increase) decrease:
Accounts receivable		(272,943	)		(752	)
Prepayments		1,547,000			(720,051	)
Other receivables		(246,844	)		(802,900	)
Increase (decrease):
Accounts payable and accrued liabilities		228,775			(792,708	)
Taxes payable		2,601,664			474,045
Due to related party		588,140			—
Liabilities from risk reserve fund guarantee		5,364,095			2,122,641
Other payables		283,324			—
Net cash provided by operating activities		20,228,188			2,908,994

Cash flows from investing activities:
Purchases of property and equipment		(627,301	)		(17,886	)
Purchase of intangible asset		—			(18,850	)
Purchase of short-term investments		(7,345,919	)		—
Proceeds from disposal of short-term investments		15,720,267			—
Disbursements for short-term entrusted loans made		(34,525,821	)
Investment in an equity investee		(2,806,142	)		—
Net cash used in investing activities		(29,584,916	)		(36,736	)

Cash flows from financing activities:
Proceeds from issuance of convertible notes		13,275,151			—
Net cash provided by financing activities		13,275,151			—

Effect of exchange rate change		462,191			(191,649	)

Cash and cash equivalents:
Net increase		4,380,614			2,680,609
Balance at beginning of period		8,561,695			5,712,741
Balance at end of period	$	12,942,309		$	8,393,350

Supplemental Disclosures of Cash flow Information:
Cash paid for income taxes	$	415,719		$	—

~~All these contractual agreements, collectively,~~The ~~enable~~accompanying usnotes toare ~~exercise effective control over, and realize substantially all of the economic risks and benefits arising from Benefactum Beijing, as well as give us~~ an ~~exclusive~~integral ~~option to purchase all or~~ part of ~~the~~these ~~equity~~unaudited ~~interests~~condensed and assets of Benefactum Beijing when and to the extent permitted by PRC law. Therefore, the Company believes that Benefactum Beijing should be considered as a Variable Interest Entity (“VIE”) under the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 810 “Consolidation”. Accordingly, the accounts of Benefactum Beijing are consolidated ~~with~~ ~~those~~financial ~~of WFOE.~~statements

~~Note 2 – Summary of significant accounting policies~~5

~~Basis~~Hui Ying ofFinancial ~~presentation~~Holdings ~~and principles of consolidation~~Corporation

~~The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States~~ (~~“U.S.~~f/k/a ~~GAAP”~~SINO orFORTUNE ~~the~~HOLDING ~~“Standard”).~~CORPORATION InAND ~~the opinion of management, all adjustments (consisting only of normal recurring adjustments~~SUBSIDIARIES) necessary for the fair presentation of the financial information for the interim periods reported have been made. Interim results are not necessarily indicative of results of a full year. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes included in our annual report on Form 10-K for the fiscal year ended December 31, 2016, filed with the Securities and Exchange Commission on April 13, 2017.

~~The~~NOTES ~~unaudited~~TO ~~condensed~~UNAUDITED ~~consolidated~~CONDENSED ~~financial~~CONSOLIDATED ~~statements~~FINANCIAL ~~include~~STATEMENTS the accounts of Sino Fortune, Benefactum Alliance, including its wholly owned subsidiaries Benefactum Sino and WFOE, and its variable interest entity Benefactum Beijing. All inter-company balances and transactions have been eliminated in consolidation.

~~Use~~Note 1 - Organization and description of ~~Estimates~~business

~~Preparation~~Hui ofYing ~~financial~~Financial ~~statements~~Holdings inCorporation ~~conformity~~(“the ~~with~~Company”) ~~U.S.~~(formerly ~~GAAP~~known ~~requires~~as ~~management~~Sino toFortune ~~make~~Holding ~~estimates~~Corporation ~~and~~until ~~assumptions~~its ~~that~~name ~~affect~~was ~~the~~changed ~~reported~~on ~~amount~~September of29, ~~assets and liabilities~~2017), ~~and~~was ~~disclosure~~incorporated ofin ~~contingent assets and liabilities at~~ the ~~date~~State of ~~the~~Nevada ~~unaudited~~on ~~condensed~~April ~~consolidated~~18, ~~financial~~2014 ~~statements~~under ~~as well as~~ the ~~reported~~original ~~amounts~~name ofTapioca ~~revenues and expenses during the reporting period~~Corp. ~~Significant~~Effective ~~estimates~~April ~~required~~18, to2016, bethe ~~made by~~Company ~~management~~amended ~~include,~~its ~~but~~name ~~are~~from ~~not~~Tapioca ~~limited~~Corp. to, ~~useful~~Sino ~~lives~~Fortune ofHolding ~~property,~~Corporation. ~~plant~~Effective ~~and~~on ~~equipment~~September 29, ~~intangible assets~~2017, the ~~recoverability of~~Company ~~long-lived~~amended ~~assets,~~its name ~~allowance~~from ~~for~~Sino ~~doubtful~~Fortune ~~accounts,~~Holding ~~deferred~~Corporation ~~revenues~~to ~~and~~Hui ~~deferred~~Ying ~~income~~Financial ~~tax.~~Holdings ~~Actual results could differ from those estimates~~Corporation.

7On May 13, 2016, the Company entered into a share exchange agreement (the “Share Exchange Agreement”) and on September 14, 2016, the Company entered into an amendment to the Share Exchange Agreement (the “Amendment”) with Benefactum Alliance Holdings Company Limited (“Benefactum Alliance”), a British Virgin Islands company, and all the shareholders of Benefactum Alliance, namely, Mr. Bodang Liu, Avis Genesis Inc. and Manor Goldie Inc. (each a “Shareholder” and collectively the “Shareholders”), to acquire all the issued and outstanding capital stock of Benefactum Alliance in exchange for the issuance to the Shareholders an aggregate of 337,500,000 restricted shares of our common stock (the “Reverse Merger”). The Reverse Merger closed on September 29, 2016. As a result, Benefactum Alliance became our wholly owned subsidiary and after the Reverse Merger, the Company had a total of 342,960,000 ( or 68,592,000 after considering the effect of 1:5 reverse stock split approved in June 2017) shares of common stock outstanding and former shareholders of Benefactum Alliance owned 98.41% of the issued and outstanding shares.

~~Cash~~The acquisition of Benefactum Alliance was accounted for as a recapitalization effected by a share exchange, wherein Benefactum Alliance is considered the acquirer for accounting and ~~Cash~~financial ~~Equivalents~~reporting purposes (legal acquiree) with no adjustment to the historical basis of its assets and liabilities. Benefactum Alliance’s Shareholders become the majority shareholders and have control of the Company. The Company was a non-operating public shell prior to the acquisition and as a result of the acquisition of Benefactum Alliance, the Company is no longer a shell company. Pursuant to Securities and Exchange Commission (“SEC”) rules, the merger or acquisition of a private operating company into a non-operating public shell with nominal net assets is considered a capital transaction in substance, rather than a business combination. The historical financial statements for periods prior to September 29, 2016 are those of Benefactum Alliance except that the equity section and earnings per share have been retroactively restated to reflect the recapitalization.

~~Cash~~Benefactum ~~and~~Alliance ~~cash~~is ~~equivalents~~a ~~include~~holding ~~cash~~company incorporated under the laws of British Virgin Islands on ~~hand~~March ~~and~~15, ~~highly~~2016. ~~liquid~~On ~~investments~~April ~~with~~7, ~~maturities~~2016, Benefactum Alliance incorporated Benefactum Sino Limited (“Benefactum Sino”) in Hong Kong SAR. Benefactum Sino, in turn, incorporated Benefactum Alliance (Shenzhen) Investment Consulting Company Limited (“Benefactum Shenzhen” or “WFOE”) in the People’s Republic of ~~three~~China ~~months~~(“PRC” or ~~less~~“China”) ~~when~~with ~~purchased~~a registered capital of RMB 100,000 on April 21, 2016. ~~The~~Benefactum ~~Company~~Shenzhen entered ~~has~~into noa ~~cash~~series ~~equivalents~~of contractual agreements with Benefactum Alliance Business Consultant (Beijing) Co., Ltd. (“Benefactum asBeijing”), a company incorporated in the People’s Republic of ~~June~~China 30on September 10, ~~2017~~2013 ~~and~~with ~~December~~a 31registered capital of RMB 50,000,000. ~~2016~~Benefactum Beijing is engaged in operating an electronic online financial platform, ~~respectively~~www.hyjf.com, as well as mobile apps, which are designed to match investors with small and medium-sized enterprises (“SMEs”) and individual borrowers in China and generate its revenue from services in connection with matching investors with these borrowers.

~~Investments~~Due to PRC legal restrictions on foreign ownership and investment in, among other areas, value-added telecommunications services, which include internet content providers, or ICPs, we, similar to all other entities with foreign-incorporated holding company structures operating in our industry in China, have to operate our internet businesses and other businesses in which foreign investment is restricted or prohibited in the PRC through a series of contractual agreements between our WFOE and our operating entity of Benefactum Beijing. These agreements include Trademarks, Technologies & Management and Consulting Service Agreement; The Equity Interest Pledge Agreement; Exclusive Right and Option to Purchase Agreement; Equity Interest Holders’ Voting Rights Proxy Agreement.

Investments other than highly liquid ones are classified and accounted for as available-for-sale. Management determines the appropriate classification of its investments at the time of purchase and reevaluates the classifications at each balance sheet date. The Company classifies its investments as either short-term or long-term based on each instrument’s underlying contractual maturity date, the nature of the investment and its availability for use in current operations. The Company’s investments are carried at fair value, with unrealized gains and losses, net of taxes, reported as a component of accumulated other comprehensive income in shareholders’ equity, with the exception of unrealized losses believed to be other-than-temporary, which are reported in earnings in the current period. When we sell an investment, the cost is based on the specific identification method. 6

~~Prepayments~~All these contractual agreements, collectively, enable us to exercise effective control over, and realize substantially all of the economic risks and benefits arising from Benefactum Beijing, as well as give us an exclusive option to purchase all or part of the equity interests and assets of Benefactum Beijing when and to the extent permitted by PRC law. Therefore, the Company believes that Benefactum Beijing should be considered as a Variable Interest Entity (“VIE”) under the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 810 “Consolidation”. Accordingly, the accounts of Benefactum Beijing are consolidated with those of WFOE.

~~Prepayments~~Benefactum ~~consist~~Beijing ofincorporated ~~amounts~~Qianhai Zhonghui ~~paid~~Business ~~in advance~~Consultant toCo., ~~contractors~~Ltd (“Qianhai”) On May 9, 2017 and ~~vendors~~incorporated ~~for~~Puhui ~~goods~~Equity Investment Co., Ltd (“Puhui”) on February 24, 2017. Both Qianhai and ~~services~~Puhui are located in Xinjiang Huoerguosi Economic Development Zone, where a favorable income tax holiday is offered for service-oriented entities.

~~Property~~Note ~~and~~2 ~~Equipment~~– Summary of significant accounting policies

~~Property~~Basis ~~and equipment are recorded at cost. Depreciation is computed using the straight-line method, over the estimated useful lives~~ of ~~these~~presentation ~~assets.~~and ~~Estimated useful~~principles ~~lives~~ of ~~the assets are as follows:~~consolidation

Office furniture	3 years
Electronic equipment	5 years
Automobile	5 years
Leasehold improvement	1 to 3 years

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP” or the “Standard”). In the opinion of management, all adjustments (consisting only of normal recurring adjustments) necessary for the fair presentation of the financial information for the interim periods reported have been made. Interim results are not necessarily indicative of results of a full year. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes included in our annual report on Form 10-K for the fiscal year ended December 31, 2016, filed with the Securities and Exchange Commission on April 13, 2017.

~~Maintenance~~The ~~and~~unaudited ~~repairs~~condensed ~~are~~consolidated ~~charged directly~~financial tostatements ~~expenses~~include asthe ~~incurred.~~accounts ~~Major~~of ~~additions~~the ~~and~~Company, ~~betterment~~Benefactum toAlliance, ~~property~~including ~~and~~its ~~equipment~~wholly ~~are~~owned ~~capitalized~~subsidiaries Benefactum Sino and WFOE, ~~depreciated~~and ~~over~~its ~~the~~variable ~~remaining useful~~interest ~~life~~entity ofBenefactum ~~the~~Beijing. ~~assets~~All inter-company balances and transactions have been eliminated in consolidation.

~~Long-Lived~~Use ~~Assets~~of Estimates

~~Certain~~Preparation ~~assets~~of ~~such~~financial asstatements ~~property, plant~~in ~~and~~conformity ~~equipment~~with ~~are~~U.S. ~~reviewed~~GAAP ~~for~~requires ~~impairment~~management ~~whenever~~to ~~events~~make orestimates ~~changes~~and inassumptions ~~circumstances indicate~~ that affect the ~~carrying~~reported amount ~~may~~of ~~not be~~assets ~~recoverable.~~and ~~Recoverability~~liabilities and disclosure of contingent assets ~~that~~and ~~are~~liabilities ~~held~~at ~~and~~the ~~used~~date isof ~~measured~~the byunaudited acondensed ~~comparison~~consolidated offinancial statements as well as the ~~carrying~~reported ~~amount~~amounts of anrevenues ~~asset to~~and ~~estimated~~expenses ~~undiscounted~~during ~~future~~the ~~cash~~reporting ~~flows~~period. ~~expected~~Significant estimates required to be ~~generated~~made by management ~~the~~include, ~~asset.~~but Ifare ~~the~~not ~~carrying~~limited ~~amount~~to, ofallowance anfor ~~asset~~loan ~~exceeds~~principal ~~its estimated~~receivables, ~~future~~allowance ~~cash~~for ~~flows~~doubtful accounts, anfair ~~impairment~~value of ~~charge~~investments, isuseful ~~recognized~~lives byof ~~the~~property ~~amount~~and byequipment, ~~which~~intangible assets, the ~~carrying~~recoverability ~~amount~~of ~~exceeds~~long-lived ~~the~~assets, ~~fair~~and ~~value~~deferred ofincome ~~the~~tax. ~~asset~~Actual results could differ from those estimates.

8Cash and Cash Equivalents

~~Fair~~Cash ~~Value~~and cash equivalents include cash on hand and highly liquid investments with maturities of ~~Financial~~three ~~Instruments~~months or less when purchased. The Company’s cash equivalents, which consist of money market funds, are measured at fair value on a recurring basis. As of September 30, 2017 and December 31, 2016, the carrying amount of cash equivalent was $7,556,519 and Nil, respectively, which approximates fair value and was determined based upon Level 1 inputs.

~~The~~Short-term Company follows the provisions of Accounting Standards Codification (“ASC”) 820, “Fair Value Measurements and Disclosures”. ASC 820 clarifies the definition of fair value, prescribes methods for measuring fair value, and establishes a fair value hierarchy to classify the inputs used in measuring fair value as follows: Investments

~~Level~~Short-term 1investments other than highly liquid ones are classified and accounted for as available-for-sale. ~~Observable~~Management ~~inputs~~determines ~~such~~the appropriate classification of its investments at the time of purchase and reevaluates the classifications at each balance sheet date. The Company classifies its investments as ~~unadjusted~~either short-term or long-term based on each instrument’s underlying contractual maturity date, the nature ~~quoted~~of ~~prices~~the ininvestment ~~active~~and ~~markets~~its availability for ~~identical~~use ~~assets~~in orcurrent ~~liabilities~~operations. ~~available~~The Company’s investments are carried at fair value, with unrealized gains and losses, net of taxes, reported as a component of accumulated other comprehensive income in shareholders’ equity, with the ~~measurement~~exception ~~date~~of unrealized losses believed to be other-than-temporary, which are reported in earnings in the current period. When we sell an investment, the cost is based on the specific identification method.

Level 2 - Inputs other than quoted prices that are observable for the asset or liability in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable, and inputs derived from or corroborated by observable market data. 7

~~Level 3~~ Short-term ~~Inputs~~loans ~~are~~receivable, ~~unobservable inputs which reflect management’s assumptions based on the best available information.~~net

Short-term loans receivable represents the outstanding balance of the entrusted loans extended by the Company to borrowers. The Company ~~considers~~currently ~~the~~does ~~carrying~~not ~~amount~~have lending oflicense ~~cash,~~required ~~accounts~~by ~~receivable,~~relevant ~~other~~laws ~~receivables,~~to ~~accounts~~extend ~~payable,~~loans ~~accrued~~to ~~liabilities~~borrowers directly. Instead, ~~other~~it ~~payables~~entrusts ~~and~~a ~~taxes~~third ~~payable~~party ~~approximate~~who has proper license ~~their~~to ~~fair~~facilitate ~~values~~loans ~~because~~with offunds ~~the~~provided ~~short~~by ~~period~~the ofCompany. ~~time~~Loans ~~between~~receivable ~~the~~are ~~origination~~recorded ofat ~~such~~unpaid ~~instruments~~principal ~~and~~balances, ~~their~~net ~~expected~~of ~~realization~~allowance ~~and~~for ~~their~~loan ~~current~~losses ~~market~~that ~~rate~~reflects the Company’s best estimate of ~~interest~~the amounts that will not be collected.

The ~~Company~~allowance ~~used~~for ~~Level~~loan 3losses ~~inputs~~is ~~for its~~determined ~~valuation~~at ~~methodology~~a ~~for~~level ~~the~~believed ~~short-term~~to ~~investment~~be inreasonable ~~determining~~to absorb probable losses inherent in the ~~fair~~loan ~~value~~portfolio as of each balance sheet date. The allowance ~~following~~is ~~tables~~provided ~~include~~based on an assessment performed on a ~~roll-forward of~~portfolio ~~short-term~~basis. ~~investments~~All ~~classified~~loans ~~within~~are ~~Levels~~assessed 1collectively depending on factors such as delinquency rate, 2size, and 3: other risk characteristics of the portfolio.

	Level 1		Level 2		Level 3
Total short-term investments at December 31, 2016	$	—	$	—	$	8,274,306
Deductions						(8,274,306	)
Additions		—		—		7,420,365
Total short-term investments at June 30, 2017	$	—	$	—	$	7,420,365

Loan principal are charged off when a settlement is reached for an amount that is less than the outstanding balance or when the Company has determined the balance is uncollectable. In accordance with ASC 310-10-35-41, the Company determines that any loans with outstanding balance that are 90 days past due are deemed uncollectible and therefore charged-off.

~~Revenue~~The ~~Recognition~~Company started the lending business of entrusted loans in June 2017 through Qingdao Weichuang private Capital Management Co., Ltd (“Qingdao Weichuang”) as a partner. The Company pays a fixed processing fee equal to 0.15% of the aggregate loan amount to Qingdao Weichuang for facilitating these entrusted loans. All loans receivable consist of loans to small and medium sized enterprise (“SME”) with the term period ranging from 3 months to 6 months. For the three and nine months ended September 30, 2017, the Company did not record any provision for loan losses.

~~Revenues are primarily composed of fees collected from services provided with facilitating loan originations and services provided with assisting in loan repayment process through our online platform.~~Prepayments

~~The~~Prepayments ~~Company~~consist ~~recognizes~~of ~~revenues~~amounts ~~under~~paid ~~ASC~~in ~~605~~advance ~~when~~to ~~the~~contractors ~~following~~and ~~four~~vendors ~~revenue recognition criteria are met~~ for ~~each~~goods ~~revenue type: (i) persuasive evidence of an arrangement exists, (ii) delivery has occurred or services have been rendered, (iii) the selling price is fixed or determinable,~~ and ~~(iv) collectability is reasonably assured~~services.

9Property and Equipment

~~Loan~~Property ~~facilitation~~and ~~service~~equipment isare ~~rendered~~recorded ~~when a loan is successfully matched between the lenders and the~~at ~~borrowers;~~cost. ~~and~~Depreciation ~~when a loan~~ is ~~originated.~~computed ~~The~~using ~~origination of a loan takes place when~~ the ~~funds~~straight-line ~~provided~~method, byover the ~~investor~~estimated ~~are~~useful ~~transferred to~~lives ~~the borrower. Revenue is recognized when loan facilitation service is rendered and fee is collected from borrower upon the closing~~ of ~~the~~these ~~loan~~assets. ~~The~~Estimated ~~aforementioned~~useful lives ~~fee is an agreed upon percentage~~ of the ~~total~~assets ~~principal~~are ~~which~~as ~~varies based on the terms of the loan. The borrower has to agree upfront to such service fee and such service fee is not refundable.~~follows:

Towards the end of each loan term, the Company also provide repayment service to ensure loan repayment process is handled smoothly through our online platform and to assist in release of liens or collaterals if applicable. The Company charges a separate fee for loan repayment service. Loan repayment service is rendered when a loan matures and borrower repays the principal and interest through our online platform. Revenue is recognized when repayment service is rendered and collection of service fee from borrowers is assured. The repayment service fee is based on an agreed upon percentage on the borrowing times the duration of a loan and is not refundable.

Office furniture	3 years
Electronic equipment	5 years
Automobile	5 years
Leasehold improvement	1 to 3 years

~~Income~~Maintenance ~~Taxes~~and repairs are charged directly to expenses as incurred. Major additions and betterment to property and equipment are capitalized and depreciated over the remaining useful life of the assets.

~~Deferred~~Long-Lived tax assets and liabilities are recognized for the future tax consequences attributable to differences between the consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period including the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. Assets

~~The~~Certain ~~provisions~~assets ofsuch ~~ASC~~as ~~740-10-25~~property, ~~“Accounting~~plant ~~for~~and ~~Uncertainty~~equipment inare ~~Income~~reviewed ~~Taxes,”~~for ~~prescribe~~impairment awhenever ~~more-likely-than-not~~events ~~threshold~~or ~~for~~changes ~~consolidated~~in ~~financial~~circumstances ~~statement~~indicate ~~recognition and~~that ~~measurement~~the ofcarrying aamount ~~tax~~may ~~position~~not be ~~taken~~recoverable. ~~(or~~Recoverability ~~expected~~of toassets bethat ~~taken)~~are inheld aand ~~tax~~used ~~return.~~is ~~This~~measured ~~interpretation~~by ~~also~~a ~~provides~~comparison ~~guidance~~of on the ~~recognition~~carrying amount of ~~income~~an ~~tax~~asset to ~~assets~~estimated ~~and~~undiscounted ~~liabilities,~~future ~~classification~~cash offlows ~~current~~expected ~~and~~to ~~deferred~~be ~~income~~generated ~~tax~~by ~~assets~~the ~~and~~asset. ~~liabilities, accounting~~If ~~for~~the ~~interest~~carrying ~~and~~amount ~~penalties~~of ~~associated~~an ~~with~~asset ~~tax~~exceeds ~~positions,~~its estimated ~~and~~future ~~related~~cash ~~disclosures.~~flows, ~~The~~an ~~Company~~impairment ~~does~~charge ~~not~~is ~~believe~~recognized ~~that there~~by ~~was~~the ~~any~~amount ~~uncertain~~by ~~tax~~which ~~position~~the atcarrying ~~June~~amount ~~30,~~exceeds ~~2017~~the ~~and~~fair ~~December~~value of ~~31,~~the ~~2016~~asset.

~~Foreign Currency Translation~~ 8

~~Benefactum~~Investment ~~Beijing maintains its accounting records~~ in Renminbi (“RMB”), which is the primary currency of the economic environment in which its operations are conducted. The Company’s principal country of operations is the PRC. The financial position and results of its operations are determined using RMB, the local currency, as its functional currency. The results of operations and the statement of cash flows denominated in foreign currency are translated at the average rate of exchange during the reporting period. Assets and liabilities denominated in foreign currencies at the balance sheet date are translated at the applicable rates of exchange in effect at that date. The equity denominated in the functional currency is translated at historical rate of exchange. Because cash flows are translated based on the average translation rate, amounts related to assets and liabilities reported on the statement of cash flows will not necessarily agree with changes in the corresponding balances on the balance sheet. Translation adjustments arising from the use of different exchange rates from period to period are included as a component of shareholders’ equity as “Accumulated Other Comprehensive Income (Loss)”.investees

10For equity investments in entities over which the Company does not have control or significant influence and for which there is no readily determinable fair value, the cost method is used. Under the cost method, the Company carries the investment at cost and recognizes income to the extent of dividends received from the distribution of the equity investee’s post-acquisition profits.

~~Translation~~Fair ~~gains~~Value ~~and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in the results~~ of ~~operations~~Financial as incurred. Gains and losses from foreign currency transactions are included in the results of operations. No material transaction gains or losses were recognized for the six months ended June 30, 2017 and 2016. Instruments

The ~~value~~Company offollows ~~RMB~~the ~~against~~provisions ~~U.S.~~of ~~dollar and~~Accounting ~~other~~Standards ~~currencies~~Codification ~~may~~(“ASC”) ~~fluctuate and is affected by~~820, ~~among~~“Fair ~~other~~Value ~~things,~~Measurements ~~changes in the PRC’s political~~ and ~~economic conditions~~Disclosures”. ~~Any~~ ~~significant~~ASC ~~revaluation~~820 ofclarifies ~~RMB may materially affect~~ the ~~Company’s financial condition in terms~~ definition of ~~financial~~fair ~~reporting in~~value, ~~U.S.~~prescribes ~~dollars.~~methods ~~The~~for ~~following~~measuring ~~table~~fair ~~outlines~~value, ~~the~~and ~~currency~~establishes ~~exchange~~a ~~rates~~fair ~~that~~value ~~were~~hierarchy ~~used~~to inclassify ~~creating~~ the ~~condensed~~inputs ~~consolidated~~used ~~financial~~in ~~statements~~measuring infair ~~this~~value ~~report~~as follows:

		As of June 30, 2017		As of December 31, 2016
Balance sheet items, except for equity accounts		US$1 = RMB 6.7774		US$1 = RMB 6.9448

Level 1 - Observable inputs such as unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date.

	Six Months Ended June 30,
	2017	2016
Items in the statements of income and cash flows	US$1 = RMB 6.8752	US$1 = RMB 6.5624

~~Comprehensive~~Level ~~Income~~3 ~~(Loss)~~- Inputs are unobservable inputs which reflect management’s assumptions based on the best available information.

~~Comprehensive~~The ~~income~~Company ~~(loss)~~considers ~~consists~~the ofcarrying amount ~~two~~of ~~components~~cash and cash equivalents, ~~net~~accounts ~~income~~receivable, ~~(loss)~~short-term ~~and~~loan receivable, other ~~comprehensive~~receivables, ~~income~~accounts ~~(loss).~~payable, ~~The~~accrued ~~foreign~~liabilities, convertible ~~currency~~debt, ~~translation~~other ~~gain~~payables orand ~~loss~~taxes ~~resulting from~~payable ~~translation~~approximate their fair values because of the ~~financial~~short ~~statements~~period ~~expressed~~of intime ~~RMB~~between tothe origination ~~USD~~of such instruments and ~~unrealized~~their ~~gain~~expected orrealization ~~loss~~and ~~from~~their ~~available-for-sale~~current ~~investment are~~market ~~reported~~rate inof ~~other~~interest. ~~comprehensive~~The ~~income~~following ~~(loss)~~table insets forth the ~~condensed~~Company’s ~~consolidated~~assets ~~statements~~and ofliabilities ~~income~~that ~~and~~are ~~other~~measured ~~comprehensive~~at ~~income (loss)~~fair ~~and~~value ~~the~~on ~~condensed~~a ~~consolidated~~recurring ~~statements~~basis ofand ~~shareholders’~~are ~~equity.~~categorized using the fair value hierarchy:

Earnings per Share (“EPS”)

As of December 31, 2016	Level 1		Level 2		Level 3		Balance at fair value

Short term investment – wealth products	$	—	$	—	$	8,274,306	$	8,274,306
Cash equivalents – money market funds		—		—		—		—
Total	$	—	$	—	$	—	$	8,274,306

Basic EPS is measured as net income divided by the weighted average common shares outstanding for the period. Diluted EPS is similar to basic EPS but presents the dilutive effect on a per share basis of potential common shares (i.e., options and warrants) as if they had been converted at the beginning of the periods presented, or issuance date, if later. Potential common shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS.

As of September 30, 2017	Level 1		Level 2		Level 3		Balance at fair value

Short term investment – wealth products	$	—	$	—	$	—	$	—
Cash equivalents – money market funds		7,556,519		—		—		7,556,519
Total	$	7,556,519	$	—	$	—	$	7,556,519

11There have been no transfers of assets or liabilities between the fair value measurement levels. The following table is a reconciliation of the fair value measurements that use significant unobservable inputs (Level 3):

Risks and Uncertainties

Short-term investments	Level 3
Balance, December 31, 2016	$	8,274,306
Purchases		7,345,919
Unrealized gains		268,498
Repayments		—
- Principal		(15,720,267	)
- Realized gains		(268,498	)
Effect of exchange rate change		100,042
Balance, September 30, 2017	$	—

~~Default risk~~ 9

~~Investments~~The inCompany ~~loans~~measured onshort-term ~~our~~investments at ~~online~~fair ~~marketplace involve~~value ~~inherent~~on ~~risks~~a asrecurring ~~the~~basis. ~~return~~The fair values of ~~the~~these ~~principal~~investments onare adetermined ~~loan~~based ~~investment~~on ~~made~~valuation ~~through~~techniques ~~our~~using ~~platform~~the best isinformation ~~not~~available, ~~guaranteed.~~and ~~Although we~~may ~~are~~include ~~not~~market ~~liable~~comparable, ~~for~~quoted ~~default~~market ~~loss~~rates of interest, wethird-party ~~aim~~pricing toinformation and ~~limit~~discounted ~~investor~~cash ~~losses~~flow ~~due~~projections, towhich ~~borrower~~the ~~defaults~~Company believes is less sensitive to ~~within~~changes anin ~~industry~~uncertainty ~~acceptable~~given ~~range~~the short-term ~~through~~nature ~~various~~of ~~preventive~~these ~~measures~~investments wewith ~~have~~a ~~taken~~maturity orof ~~will~~six ~~take~~months or less. ~~Our~~The ~~ability~~short-term toinvestments ~~attract~~have ~~borrowers~~been classified and ~~investors~~accounted for ~~to,~~as available-for-sale with unrealized gains and ~~build~~losses ~~trust~~recognized in Other Comprehensive Income under Net Unrealized Gain (Loss) on Investments (net of tax effect). Realized gains and losses on short-term investments available for sale are reclassified from Other Comprehensive Income when applicable and recognized in, ~~our~~Other ~~marketplace~~Income is(Expense) ~~significantly~~under ~~dependent~~Realized Gain (Loss) on ~~our~~Investments. An ~~ability~~impairment tocharge ~~effectively~~is ~~evaluate~~recorded ain ~~borrower’s~~earnings ~~credit~~in ~~profile~~the current period when the cost of the investment exceeds its fair value and ~~maintain~~this ~~low~~condition ~~default~~is ~~rates~~determined to be other-than-temporary. ToDuring ~~conduct~~the ~~this~~three ~~evaluation~~and nine months ended September 30, we2017 ~~have~~and ~~employed~~2016, the Company did not record any other-than-temporary impairments on short-term investments required to be measured at fair value on a ~~series~~nonrecurring basis. ofSee ~~review~~also ~~and~~Note ~~assessment~~3 ~~procedures~~– Short-term investments.

~~Default~~Risk ~~risk~~Reserve is controlled by the application of credit approvals, limits and monitoring procedures. The Company manages default risk through in-house research and analysis of the Chinese economy and the underlying obligors and transaction structures. To minimize default risk, we offer a risk reserve fund which is 2-5% of the credit extended to the third-party guarantors or borrowers who do not have a guarantor (See Note 11 – Liabilities from risk reserve fund guarantee).Fund

~~The~~In order to better protect the investors' interests on our online platform, the Company ~~identifies~~has ~~default~~established a risk ~~collectively~~reserve fund which ~~based~~is generally equivalent to 2% to 5% of all credit extended to borrowers. Prior to an application for credit being made on ~~industry~~our platform, ~~geography~~the borrower (or if a guarantor is needed for the borrower, the guarantor) is required to provide an amount equal to 2% to 5% of the aggregate amount of the loan, which is deposited directly into the risk reserve fund and ~~customer~~recorded ~~type~~as liabilities from risk reserve fund guarantee on the balance sheet. ~~This~~If ~~information~~the isborrower ~~monitored~~cannot ~~regularly~~be matched with an investor within the fundraising period (no more than 19 days), all amounts deposited by ~~management~~the borrower or guarantor in the risk reserve fund, as the case may be, will be returned. If the borrower is successfully matched with an investor, the risk reserve fund will be refunded to the borrower if the loan is paid in full at maturity.

In the ~~measuring~~event ~~the~~that ~~default~~a ~~risk~~borrower ofdefaults ~~extending loans~~in torepaying ~~corporate~~the ~~borrowers~~loan when it is due, the Company ~~mainly~~advises ~~reflects~~ the ~~“probability~~guarantor of such default”. byIf the guarantor cannot make the ~~borrower~~repayment onwithin ~~its~~the ~~contractual~~period as stipulated (usually three days), we withdraw a sum equivalent to ~~obligations~~the outstanding loan amount with interest and ~~considers~~penalty at a rate of 0.06% per day from the ~~current~~risk ~~financial~~reserve ~~position~~fund ofto repay investors within three business days. When more than one loan becomes delinquent and the ~~borrowers~~borrower and/or guarantor fail(s) to repay investors, we will use the ~~exposures~~risk reserve fund to cover the ~~borrowers~~loans ~~and~~in ~~its~~the ~~likely~~order ~~future~~in which they become due. If the reserve fund is insufficient ~~development~~to repay investors, the fund shall be allocated on a pro rata basis. The ~~Company~~defaulting ~~uses~~borrower ~~standard~~and/or ~~approval~~guarantor ~~procedures~~is/are obligated to ~~manage~~reimburse ~~default~~the risk ~~for~~reserve ~~their~~fund ~~loans~~account up to the outstanding loan amount owed with interest and penalty at a rate of 0.06% per day on the outstanding loan amount, which will be recorded as part of the balance of the risk reserve fund liability on the balance sheet.

~~Political~~The risk reserve fund applies only to loans facilitated through our online platform. In the role of transaction intermediary, the Company does not assume credit risk for the loans facilitated through our online platform and ~~economic~~our risk reserve liability is limited to the balance of risk reserve fund that the borrowers or guarantors deposit with us. The determination of the risk reserve fund ratio is made by referencing the overdue default loan data for the industry in which the borrower operates its business. Our risk control department starts with the industry default loan data and credit trend then adjusts it appropriately with information collected from current and past borrower profiles in the same industry on our platform, also taking into consideration communications with and updates from guarantors including changes in guarantee fees they charge borrowers and other measures they would take in providing guarantees. Based on the research results, the risk control department then sets the reserve fund ratio for the industry and reviews and adjusts it dynamically if needed from time to time, usually every quarter to six months.

~~The~~As of ~~Company’s~~September ~~operations~~30, ~~are~~2017, ~~located in~~each ~~the~~loan ~~PRC.~~transaction ~~Accordingly,~~facilitated ~~the~~on ~~Company’s~~our ~~business,~~platform ~~financial~~is ~~condition,~~guaranteed ~~and~~by ~~results~~a ofthird ~~operations~~party ~~may~~guarantor bewho ~~influenced~~is byjointly and severally liable for the ~~political,~~ ~~economic~~loan, ~~and~~except ~~legal~~for ~~environments~~the inthird ~~the~~party ~~PRC~~loan assignment, asin ~~well~~which case Creditor Partners seek to sell their rights as bycreditors ~~the~~on ~~general~~third ~~state~~party ofloans ~~the~~with ~~PRC~~borrowers ~~economy~~who are not borrowers on our platform. ~~The~~Since ~~Company’s~~these Creditor Partners are ~~operations~~usually inour ~~the~~third ~~PRC~~party ~~are~~cooperative ~~subject~~partners who refer borrowers to ~~special~~our ~~considerations~~platform and ~~significant~~provide ~~risks~~loan ~~not~~guarantee, ~~typically~~the ~~associated~~Company ~~with~~does not ~~companies~~require inthem ~~North America~~to ~~and~~provide ~~Western~~a ~~Europe.~~third ~~These~~party ~~include~~guarantor ~~risks~~when ~~associated~~they ~~with,~~seek ~~among~~to ~~others,~~sell ~~the~~their ~~political,~~creditor ~~economic~~rights ~~and~~on ~~legal~~our ~~environment,~~platform. ~~and~~They will provide ~~foreign~~a ~~currency~~"letter ~~exchange.~~of ~~The~~promise," ~~Company’s~~which ~~results~~promises ~~may~~that bethey ~~adversely~~will ~~affected~~guarantee bythe ~~changes~~loan inif the ~~political,~~Original ~~regulatory~~Borrower defaults and ~~social~~the Company requires ~~conditions~~them into deposit 2% to 5% of the ~~PRC,~~loan ~~and~~amount byinto ~~changes~~the inrisk ~~governmental~~reserve ~~policies~~fund oras ~~interpretations~~usual. ~~with~~In ~~respect~~the toevent ~~laws~~the ~~and~~Original ~~regulations,~~Borrower ~~anti-inflationary~~defaults and ~~measures,~~the ~~currency~~Creditor ~~conversion~~Partner ~~and~~also ~~remittance~~defaults ~~abroad~~on loan repayment, ~~and~~the ~~rates~~Company ~~and~~will ~~methods~~pay ofthe ~~taxation,~~investors ~~among~~the ~~other~~sum ~~things~~owed from the risk reserve fund.

~~Foreign currency risk~~Revenue Recognition

~~The value of RMB against the U.S. dollar~~Revenues and other currencies may fluctuate and is affected by, among other things, changes in political and economic conditions and the foreign exchange policy adopted by the PRC government. It is difficult to predict how market forces or PRC or U.S. government policy may impact the exchange rate between the RMB and the U.S. dollar in the future. There remains significant international pressure on the PRC government to adopt a more flexible currency policy, which could result in greater fluctuation of the RMB against the U.S. dollar. We are aprimarily ~~holding~~composed ~~company and we rely on dividends paid by our operating subsidiaries in China for our cash needs. Any significant revaluation~~ of ~~the~~fees ~~RMB~~collected ~~may~~from ~~materially~~services ~~and~~provided ~~adversely~~with ~~affect~~facilitating ~~our~~loan ~~liquidity~~originations and ~~cash~~services ~~flows.~~provided ~~To the extent that we~~with ~~need~~assisting toin ~~convert~~loan ~~U.S.~~repayment ~~dollars~~process ~~into~~through ~~RMB for~~ our ~~operations,~~online ~~appreciation of the RMB against the U~~platform.S. dollar would have an adverse effect on the RMB amount we would receive. Conversely, if we decide to convert our RMB into U.S. dollars for other business purposes, appreciation of the U.S. dollar against the RMB would have a negative effect on the U.S. dollar amount we would receive.

12Loans facilitated through our online platform are mostly short-term loans for working capital purpose, with average life of loan around three to four months. Pursuant to the agreements among the Company, the borrowers and the investors, all principal and interest payments are due and paid off in lump sum at the end of the loan term, with no payments of interest or principal over the duration of the loan. We generally sign electronically a three-party intermediary service agreement with borrowers and investors at the inception of loan, which also specifies the repayment terms with the amounts of principal and interest due at the end of the loan term. The borrowers are obligated to pay a loan origination service fee to us upfront at the time of loan issuance and a loan repayment management fee at the time when the loan is repaid. All loans originated through our online platform are repaid through our online platform. Borrowers are allowed to prepay the loan before the due date, but the borrowers are obligated to pay us the full amount of the loan repayment management fee as if the loans are repaid at the end of the loan term in accordance with agreement.

~~Reclassification~~ 10

~~Certain~~The ~~reclassifications~~Company recognizes ~~have~~revenues ~~been~~under ~~made to~~ASC ~~the~~605 ~~2016~~when ~~unaudited~~the ~~condensed~~following ~~consolidated~~four ~~financial~~revenue ~~statements~~recognition tocriteria ~~confirm~~are tomet ~~the~~for ~~2017~~each ~~unaudited~~revenue ~~condensed~~type: ~~consolidation~~(i) ~~financial~~persuasive ~~statement~~evidence ~~presentation.~~of ~~These~~an ~~reclassifications~~arrangement ~~had~~exists, no(ii) ~~effect~~delivery onhas ~~net~~occurred ~~income~~or services have been rendered, (iii) the selling price is fixed or ~~cash~~determinable, ~~flows~~and as(iv) ~~previously~~collectability ~~reported~~is reasonably assured.

~~Recent~~These ~~Accounting~~criteria as ~~Pronouncements~~they relate to each of the following major revenue generating activities are described below.

~~In February 2016, the FASB issued~~Transactions ~~ASU~~with ~~2016-02,~~online ~~“Leases~~platform’s ~~(Topic~~borrowers ~~842)”, which supersedes the existing guidance for lease accounting, “Leases (Topic 840)”. ASU 2016-02 requires lessees to recognize leases on their balance sheets,~~ and leaves lessor accounting largely unchanged. The amendments in this ASU are effective for fiscal years beginning after December 15, 2018 and interim periods within those fiscal years. Early application is permitted for all entities. ASU 2016-02 requires a modified retrospective approach for all leases existing at, or entered into after, the date of initial application, with an option to elect to use certain transition relief. The Company is currently evaluating the impact of this new standard on its consolidated financial statements. investors

In March 2016, the FASB issued ASU 2016-09, “Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting”, which simplifies several aspects of the accounting for share-based payment transactions, including the recognition of excess tax benefits and deficiencies, the classification of those excess tax benefits on the statement of cash flows, an accounting policy election for forfeitures, the amount an employer can withhold to cover income taxes and still qualify for equity classification and the classification of those taxes paid on the statement of cash flows. ASU 2016-09 is effective for annual and interim periods beginning after December 15, 2016 with early adoption permitted. The ~~guidance will be applied either prospectively, retrospectively or using a modified retrospective transition method, depending on the area covered in this update. The~~ Company ~~adopted this guidance during~~ ~~the~~generates ~~three~~loan ~~months~~facilitation ~~ended~~service ~~March~~fees ~~31, 2017~~ and ~~the~~loan ~~adoption~~repayment ~~had~~management nofees ~~impact~~by onproviding the ~~Company’s~~following ~~consolidated financial statements.~~services:

In● ~~April~~Connecting ~~2016,~~investors ~~the~~to ~~FASB~~qualified ~~issued~~borrowers ~~ASU No. 2016-10, “Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations~~ and ~~Licensing”. The~~facilitating ~~amendments~~loan ~~clarify~~origination ~~the~~between ~~following two aspects of Topic 606: (a) identifying performance obligations; and (b)~~ the ~~licensing~~ implementation guidance. The amendments do not change the core principle of the guidance in Topic 606. The effective date and transition requirements for the amendments are the same as the effective date and transition requirements in Topic 606. Public entities should apply the amendments for annual reporting periods beginning after December 15, 2017, including interim reporting periods therein (i.e., January 1, 2018, for a calendar year entity). Early application for public entities is permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period. The Company is currently evaluating the impact of this new standard on its consolidated financial statements.parties;

13● Providing loan repayment service when loan matures, including facilitating the payment channel and monitoring payments from borrowers and to investors;

InLoan ~~May~~origination service ~~2016,~~is ~~the~~rendered ~~FASB~~when ~~issued~~a ~~ASU~~loan ~~2016-12, “Revenue~~is ~~from~~successfully ~~Contracts~~matched ~~with~~between ~~Customers~~the ~~(Topic~~lenders ~~606):~~and ~~Narrow-Scope~~the ~~Improvements~~borrowers; and ~~Practical~~when ~~Expedients”,~~a ~~which~~loan is originated. ~~provides~~The ~~clarifying~~origination ~~guidance~~of ~~and~~a ~~adds~~loan ~~some~~takes ~~practical~~place ~~expedients~~when inthe funds provided by the ~~areas~~investor ofare ~~assessing~~transferred ~~collectability,~~to ~~presentation~~the ofborrower. ~~sales~~The borrower is ~~taxes~~obligated ~~received~~to ~~from~~pay ~~customers,~~loan ~~noncash~~origination ~~consideration,~~service ~~contract~~fee ~~modification~~upfront at loan inception and ~~clarification~~such ofservice ~~using~~fee ~~the~~is ~~full~~not ~~retrospective~~refundable. ~~approach~~Revenue is recognized towhen ~~adopt~~loan ~~ASU~~origination ~~2014-09~~service is rendered and fee is collected from borrower upon the closing of the loan. The ~~Company~~aforementioned fee is ~~currently~~an ~~evaluating~~agreed ~~the~~upon ~~impact~~percentage of ~~this~~the ~~new~~total ~~standard~~principal which varies based on ~~its~~the ~~consolidated~~duration ~~financial~~of ~~statements~~the loan.

~~In August 2016,~~ Towards the ~~FASB~~end ~~issued ASU 2016-15, “Statement~~ of ~~Cash~~each ~~Flows~~loan ~~(Topic~~term, ~~230): Classification of Certain Cash Receipts and Cash Payments (a consensus of~~ the ~~Emerging Issues~~Company ~~Task~~also ~~Force)”,~~provide ~~which~~repayment ~~addresses~~service ~~the~~to ~~following~~ensure ~~eight~~loan ~~specific~~repayment ~~cash~~process ~~flow~~is ~~issues~~handled ~~with~~smoothly ~~the~~through our ~~objective~~online ofplatform ~~reducing~~and ~~the existing~~to ~~diversity~~assist in ~~practice:~~release ~~(1)~~of ~~debt~~liens ~~prepayment~~ or ~~debt~~collaterals ~~extinguishment~~if ~~costs;~~applicable. ~~(2)~~The ~~settlement~~Company ofcharges ~~zero-coupon~~a ~~debt~~separate ~~instruments or~~fee ~~other~~for ~~debt~~loan repayment ~~instruments~~management ~~with~~service, ~~coupon~~which ~~interest~~is ~~rates~~determined ~~that~~based ~~are~~on ~~insignificant~~an inagreed ~~relation~~upon topercentage ~~the~~on ~~effective interest rate of~~ the borrowing~~; (3)~~ ~~contingent~~times ~~consideration payments made after a business combination; (4) proceeds from~~ the ~~settlement~~duration of ~~insurance claims; (5) proceeds from~~ the ~~settlement of corporate-owned life insurance policies, including bank-owned; (6) life insurance policies;~~ ~~(7)~~loan ~~distributions~~and ~~received~~is ~~from~~not ~~equity~~refundable. ~~method~~Borrowers ~~investees;~~are ~~(8)~~obligated ~~beneficial~~to ~~interests~~pay inloan ~~securitization~~repayment ~~transactions;~~management ~~and~~fee ~~(9)~~upon ~~separately identifiable~~repayment ~~cash flows and application~~ of the ~~predominance principle~~loan. ~~ASU~~Loan ~~2016-15 is effective for annual and interim periods~~repayment ~~beginning~~management ~~after~~fee ~~December 15, 2017 with early adoption permitted. The guidance~~ is torecognized beupon ~~applied~~the ~~using~~borrower apaying ~~retrospective~~the ~~transition method~~principal, tointerest ~~each~~and ~~period~~our ~~presented.~~management Wefee ~~are~~for ~~currently evaluating~~ the ~~impact~~loan ofrepayment ~~this~~service through ~~new standard on~~ our ~~consolidated~~online ~~financial statements~~platform.

~~In October 2016, the FASB issued ASU No.~~Entrusted ~~2016-17,~~loan ~~“Consolidation~~lending (Topic 810): Interests held through related parties that are under common control”, which requires the reporting entity, in determining if satisfying the second characteristic of a primary beneficiary, to include all of its direct variable interests in a VIE and, on a proportionate basis, its indirect variable interests in a VIE held through related parties, including related parties that are under common control with the reporting entity. The amendments are effective for public business entities for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. Early adoption is permitted, including adoption in an interim period. The Company adopted this guidance during the three months ended March 31, 2017 and the adoption had no impact on the Company’s consolidated financial statements.transactions

InFinancing income ~~November~~(interest) ~~2016,~~on ~~the~~loans ~~FASB issued ASU No. 2016-18~~receivable, ~~“Statement~~is ofaccrued ~~Cash~~and ~~Flows~~recognized ~~(Topic~~as ~~230):~~income ~~Restricted~~when ~~Cash”,~~earned. ~~which~~Accrual ~~addresses~~of ~~diversity~~interest inis ~~practice~~discontinued ~~that~~when reasonable doubt exists inas to the ~~classification~~full, ~~and~~timely ~~presentation~~collection of ~~restricted~~interest ~~cash~~or onprincipal ~~the~~(e.g. ~~statement~~when ofthe ~~cash~~loans ~~flows.~~have ~~The~~been ~~amendment~~past isdue ~~effective for~~by ~~public~~90 ~~companies~~days). ~~for~~Subsequent ~~fiscal~~recognition ~~years~~of ~~beginning~~income ~~after~~for ~~December~~loans ~~15,~~in ~~2017,~~non-accrual ~~including~~status ~~interim~~occurs ~~periods~~only ~~within~~to ~~those~~the ~~fiscal~~extent ~~years.~~payment ~~Management does~~is ~~not~~received, ~~believe~~subject to the ~~adoption~~management’s assessment of ~~this~~the ~~ASU~~collectability ~~would~~of ~~have a material effect on~~ the ~~Company’s~~remaining ~~consolidated~~interest ~~financial~~and ~~statements~~principal.

14Incentives to investors on the online platform

InTo ~~January~~attract investors ~~2017~~to our online platform, the ~~FASB~~Company ~~issued~~provides ~~ASU~~cash ~~No.~~incentives from time to time to qualified investor within a limited ~~2017-04~~period. ~~“Intangibles~~During -the ~~Goodwill~~relevant ~~and~~incentive ~~Other~~program ~~(Topic~~period, ~~350):~~the ~~Simplifying~~Company set certain thresholds for the ~~Test~~investor to qualify for ~~Goodwill~~the ~~Impairment~~cash incentive.” ~~ASU~~When ~~2017-04 eliminates~~qualified ~~step~~investment ~~two~~is ofmade, the ~~goodwill~~cash ~~impairment~~incentive ~~test~~is ~~and~~provided ~~specifies~~to ~~that~~the ~~goodwill~~investor. ~~impairment~~The ~~should~~cash beincentives ~~measured~~provided byare accounted ~~comparing~~for ~~the fair~~as ~~value~~reduction of arevenue ~~reporting~~from ~~unit~~investors in accordance with ~~its~~ASC ~~carrying~~subtopic ~~amount~~605-50. ~~Additionally,~~Given the ~~amount~~fact ofthat ~~goodwill~~the ~~allocated~~Company tohas not ~~each~~generated ~~reporting~~any ~~unit with~~revenue from investors since inception, when recording these incentives as a ~~zero~~reduction orin revenue from investors results in negative ~~carrying~~revenue ~~amount~~for ofthe ~~net~~investors ~~assets~~on ~~should~~a becumulative ~~disclosed.~~basis, ~~ASU~~the ~~2017-04~~cumulative shortfall is ~~effective~~re-characterized ~~for~~as ~~annual~~an orexpense in ~~interim~~accordance ~~goodwill impairment~~with ~~tests~~ASC ~~performed~~605-50-45-9, ingiven ~~fiscal~~the ~~years~~inherent ~~beginning~~uncertainties ~~after~~with ~~December~~the ~~15,~~incentive ~~2019;~~program ~~early~~which ~~adoption~~may isnot ~~permitted.~~result ~~The~~in sufficient probable future revenue to the Company isto ~~currently evaluating~~recover such shortfall. For the ~~impact~~three and nine months ended September 30, 2017, we recorded cash incentives of ~~this~~$552,832 ~~new~~and ~~standard~~$1,539,160, onrespectively, ~~its~~all ~~consolidated~~of ~~financial~~which ~~statements~~were re-characterized and recognized as sales and marketing expenses. We did not provide cash incentives during the three and nine months ended September 30, 2016.

In January 2017, the FASB issued ASU No. 2017-01 “Business Combinations (Topic 805): Clarifying the Definition of a Business”, which provides guidance to evaluate whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. If substantially all of the fair value of the gross assets acquired (or disposed of) is concentrated in a single asset or a group of similar assets, the assets acquired (or disposed of) are not considered a business. Management does not believe the adoption of this ASU would have a material effect on the Company’s consolidated financial statements. 11

~~In May 2017, the FASB issued ASU No. 2017-09~~Income “Compensation – Stock Compensation (Topic 718): Scope of Modification Accounting”. ASU 2017-09 clarifies when to account for a change to the terms or conditions of a share-based payment award as a modification. Under the new guidance, modification accounting is required only if the fair value, the vesting conditions or the classification of the award changes as a result of the change in terms or conditions. This ASU is effective prospectively for annual periods beginning on or after December 15, 2017, with early adoption permitted. Management does not believe the adoption of this ASU would have a material effect on the Company’s consolidated financial statements.Taxes

~~Note~~Deferred tax 3assets –and ~~Short-term~~liabilities ~~investments~~are recognized for the future tax consequences attributable to differences between the consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period including the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

OnThe ~~November 7 and December 16, 2016, to~~provisions ~~increase return~~ of ~~the~~ASC ~~Company’s~~740-10-25, ~~excess~~“Accounting ~~cash~~for ~~held~~Uncertainty in ~~banks~~Income Taxes,” ~~the~~prescribe ~~Company~~a ~~entered into two short~~more-~~term~~likely-than-not ~~entrusted~~threshold ~~financial~~for ~~management~~consolidated ~~contracts~~financial ~~(the~~statement ~~“Contracts”)~~recognition ~~with~~and ~~Shandong~~measurement ~~Wenye~~of ~~Investment~~a ~~Co.,~~tax ~~Ltd.~~position ~~(“Wenye”).~~taken ~~The contracts provide that the Company will entrust RMB 50 million~~ (or ~~$7,377,434)~~expected ~~and~~to ~~RMB~~be ~~7 million (or $1,032,841~~taken), ~~respectively,~~in toa ~~Wenye~~tax toreturn. ~~make~~This ~~investments~~interpretation inalso ~~principal~~provides ~~guaranteed~~guidance ~~short-term~~on ~~wealth products for~~ the ~~Company.~~recognition ~~Balance~~ of ~~the~~income ~~short-term~~tax ~~investments~~assets ~~was~~and $8liabilities,~~274,306~~ asclassification of ~~December~~ ~~31,~~current ~~2016.~~and ~~The~~deferred ~~term~~income tax ofassets ~~both~~and ~~contracts~~liabilities, isaccounting for ~~six~~interest ~~months~~ and ~~upon~~penalties ~~expiration~~associated inwith ~~May~~tax positions, and ~~June~~related ofdisclosures. ~~2017,~~The Company ~~Wenye~~does ~~returned~~not ~~to the~~believe ~~Company~~that ~~the~~there ~~entrusted~~was ~~principals~~any ~~with~~uncertain ~~accumulated~~tax ~~investment~~position ~~return~~at ofSeptember ~~RMB 1~~30,~~492,191~~ ~~(or~~2017 ~~$217~~and December 31,~~041)~~ 2016.

~~In May 2017, the Company entered into an~~Foreign ~~agreement~~Currency with Jiangxi Bank to purchase a principal-guaranteed wealth management product. Principal of the wealth management product is RMB 50 million (or $7,377,434) and term of the product is for 68 days from May 3 to July 10, 2017 with expected annualized rate of return of 3.60%. Balance of the short-term investment was $7,420,365 as of June 30, 2017. Upon expiration, Jiangxi Bank returned to the Company the investment principal with accumulated investment return of RMB 335,342 (or $49,479) on July 11, 2017.Translation

15Benefactum Beijing maintains its accounting records in Renminbi (“RMB”), which is the primary currency of the economic environment in which its operations are conducted. The Company’s principal country of operations is the PRC. The financial position and results of its operations are determined using RMB, the local currency, as its functional currency. The results of operations and the statement of cash flows denominated in foreign currency are translated at the average rate of exchange during the reporting period. Assets and liabilities denominated in foreign currencies at the balance sheet date are translated at the applicable rates of exchange in effect at that date. The equity denominated in the functional currency is translated at historical rate of exchange. Because cash flows are translated based on the average translation rate, amounts related to assets and liabilities reported on the statement of cash flows will not necessarily agree with changes in the corresponding balances on the balance sheet. Translation adjustments arising from the use of different exchange rates from period to period are included as a component of shareholders’ equity as “Accumulated Other Comprehensive Income (Loss)”.

~~Management determines appropriate classification~~Translation ofgains ~~its~~and ~~investments~~losses atthat ~~the~~arise ~~time~~from ofexchange ~~purchase~~rate ~~and~~fluctuations ~~reevaluates~~on ~~the~~transactions ~~classification~~denominated atin ~~each~~a ~~balance~~currency ~~sheet~~other ~~date.~~than ~~The~~the ~~short-term investments~~functional ~~have~~currency ~~been~~are ~~classified~~included ~~and~~in ~~accounted~~the ~~for~~results of operations as ~~available-for-sale,~~incurred. Gains and ~~carried~~losses atfrom ~~fair~~foreign ~~value~~currency astransactions ofare ~~June~~included in ~~30,~~the ~~2017,~~results ~~with~~of ~~unrealized~~operations. ~~gains and~~No ~~losses,~~material ~~net~~transaction ofgains ~~taxes,~~or ~~reported~~losses aswere arecognized ~~component~~for ofthe ~~accumulated~~six ~~other~~months ~~comprehensive~~ended ~~income~~June ~~(loss)~~30, in2017 ~~shareholders’ equity~~and 2016.

~~Note~~The 4value of –RMB ~~Accounts~~against ~~receivable~~U.S. dollar and other currencies may fluctuate and is affected by, among other things, changes in the PRC’s political and economic conditions. Any significant revaluation of RMB may materially affect the Company’s financial condition in terms of financial reporting in U.S. dollars.

AsThe offollowing table ~~June~~outlines ~~30,~~the ~~2017~~currency ~~and~~exchange ~~December~~rates ~~31,~~that ~~2016, the~~were ~~Company~~used ~~has~~in ~~service~~creating ~~fee~~the ~~receivable~~condensed ~~balance~~consolidated offinancial ~~$360,799~~statements ~~and~~in ~~$281,038, respectively, from ChinaPnR.~~this report:

ChinaPnR is a licensed third party online payment service, who assists us in the disbursement and repayment of loans facilitated through our online platform as well as deducts and remits service fees to us. ChinaPnR usually remits our service fee to our bank account on the next day. The receivable balance from ChinaPnR is due to the timing difference at end of the periods. All service fee receivable are considered fully collectible and no allowance is deemed necessary

		As of September 30, 2017		As of December 31, 2016
Balance sheet items, except for equity accounts		US$1 = RMB 6.6549		US$1 = RMB 6.9448

Note 5 – Short-term loans receivable

	Nine Months Ended September 30,
	2017	2016
Items in the statements of income and cash flows	US$1 = RMB 6.8065	US$1 = RMB 6.5802

~~In June 2017, the Company launched entrusted loan service through a licensed loan provider to small and medium-sized enterprises (“SME”) and individual borrowers in~~ China. The Company has engaged Qingdao Weichuang Private Capital Management Co., Ltd. (“Qingdao Weichuang”) as the trustee at launch of the service. On June 30, 2017, the Company entered into a series of entrusted loan contracts, pursuant to which the Company, as the trustor and provider of the funds, entrusted the trustee to grant entrusted loans in the aggregate principal amount of $7,377,434 (RMB 50 million) to five SME customers. This is our first series of transactions in which the Company, through licensed trustee, are lending funds directly to borrowers. The loans are short-term loans between three and six months with interest payable on a monthly basis. Interest rates charged are based on negotiation with borrowers, taking into consideration of factors such as term of the loan, the industry in which the borrower conducts its business, its credit history, financial condition, operating results and cash flows etc.12

~~In connection with execution of the entrusted~~Comprehensive ~~loan~~Income contracts, we also entered into entrusted loan guarantee contracts with financing guarantors, pursuant to which the guarantors have agreed to guarantee the obligations under the entrusted loan contracts. The Company pays a processing fee equal to 1.5‰ of the aggregate loan amount to Qingdao Weichuang for facilitating the entrusted loans. The sister of Mr. Bodang Liu, our chief executive officer and chairman, owns 48.41% of the outstanding equity interests in Qingdao Weichuang.(Loss)

16Comprehensive income (loss) consists of two components, net income (loss) and other comprehensive income (loss). The foreign currency translation gain or loss resulting from translation of the financial statements expressed in RMB to USD and unrealized gain or loss from available-for-sale investment are reported in other comprehensive income (loss) in the condensed consolidated statements of income and other comprehensive income (loss) and the condensed consolidated statements of shareholders’ equity.

~~Note~~Earnings per 6Share ~~– Prepayments~~(“EPS”)

~~The~~Basic ~~following~~EPS is measured as net income divided by the weighted average common shares outstanding for the period. Diluted EPS is similar to basic EPS but presents the dilutive effect on a ~~summary~~per share basis of ~~prepayments~~ potential common shares (i.e., options and warrants) as if they had been converted at the beginning of ~~June~~the 30periods presented, ~~2017~~or ~~and~~issuance ~~December~~date, 31if later. Potential common shares that have an anti-dilutive effect (i.e., ~~2016:~~ those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS.

	June 30,		December 31,
	2017		2016
Prepaid service fee	$	572,650	$	2,071,013
Prepayment for rent		55,866		—
Down payment for fixed asset		257,377		7,200
Others		18,583		713
Prepayments	$	904,476	$	2,078,926

Risks and Uncertainties

~~We pay a service fee to third-party service~~Default providers based on the amount of loans the service providers refer to us. In order to negate the impact of regulation limitation on online P2P platform’s off-line sales activities, in April 2016, the Company entered into a cooperation agreement with Shanghai Nami Financial Consulting Co., Ltd (“Nami”), pursuant to which Nami will refer potential investors to us, and in turn we will pay Nami a service fee based on the amount of loans extended by the investors it refers to us. As of June 30, 2017, balance of prepaid service fee was $572,650, with $571,175 paid to Nami and $1,475 to another service provider.risk

~~Prepayment~~Investments in ~~for~~loans ~~rent~~on ~~amounted~~our toonline ~~$55,866~~ marketplace involve inherent risks as the return of ~~June~~the ~~30,~~principal ~~2017~~on ~~for~~a ~~offices~~loan ininvestment ~~Beijing~~made ~~and~~through ~~Shanghai~~our platform is not guaranteed. ~~The~~Although ~~Company~~we ~~made~~are ~~down~~not ~~payment~~liable offor ~~$257~~default loss,~~377~~ we aim to limit investor losses due to borrower defaults to within an industry acceptable range through various preventive measures we have taken or will take. Our ability to attract borrowers and $7investors to,~~200~~ asand ofbuild ~~June~~trust 30in, ~~2017~~our marketplace is significantly dependent on our ability to effectively evaluate a borrower’s credit profile and ~~December~~maintain ~~31,~~low ~~2016,~~default ~~respectively~~rates. To conduct this evaluation, ~~for~~we ~~acquisition~~have employed a series of ~~fixed~~review and ~~assets~~assessment procedures.

~~Note~~Default risk 7is –controlled ~~Deposit~~by the application of credit approvals, limits and monitoring procedures. The Company manages default risk through in-house research and analysis of the Chinese economy and the underlying obligors and transaction structures. To minimize default risk, we established a risk reserve funds policy with our borrowers and related guarantors. In accordance with the risk reserve policy, investors are recoverable from the certain portion of unpaid principal and interest repayment of the defaulted loan up to the balance of the risk reserve funds provided by borrowers or his related guarantors. The risk reserve fund being set aside by borrowers or his guarantor equals to 2% to 5% of the loan principal amount for ~~business~~loans facilitated on our platform. ~~acquisition~~There is no limit on the period of time in which an investor can receive payments for unpaid interest and principal from the risk reserve policy, but the Company’s obligation under the risk reserve liability to make payments is limited to the balance of the risk reserve liability at any point in time.

InThe ~~June 2017, the~~ Company ~~entered into~~ aidentifies ~~share~~default ~~transfer~~risk ~~framework~~collectively ~~agreement~~based ~~(the~~on ~~“Agreement”) with Shenzhen TouZhiJia Financial Information Service Co.~~industry, ~~Ltd. (“Shenzhen~~geography ~~TouZhiJia Financial”)~~ and ~~certain~~customer ~~shareholders of Shenzhen TouZhiJia Financial (the “Shareholders”), pursuant to which the Company will acquire a 4~~type.~~45%~~ ~~equity~~This ~~interest~~information in Shenzhen TouZhiJia Financial from the Shareholders for an aggregate purchase price of RMB 19,100,008 (or $2,818,181). Fifty percent of the purchase price or $1,409,091 was paid in cash as a deposit by the Company in accordance with the Agreement and balance of the purchase price is ~~payable~~monitored ~~upon~~regularly ~~the closing of the~~by ~~transaction, which we expect will be consummated within 90 days after execution of the Agreement~~management. ~~In the event the transaction does not close, the deposit made to the Shareholders shall be promptly returned to the Company.~~

~~Note~~In 8measuring the –default ~~Other~~risk ~~receivables~~of extending loans to corporate borrowers, the Company mainly reflects the “probability of default” by the borrower on its contractual obligations and considers the current financial position of the borrowers and the exposures to the borrowers and its likely future development. The Company uses standard approval procedures to manage default risk for their loans.

~~The following is a summary of other receivables~~Political ~~as of June 30, 2017~~ and ~~December~~economic ~~31, 2016:~~risk

	June 30,		December 31,
	2017		2016
Security deposit	$	244,012	$	106,489
Advances and loans		529,443		686,360
Proceeds from issuance of convertible notes		3,007,346		—
Other receivable and deposit	$	3,780,801	$	792,849

The Company’s operations are located in the PRC. Accordingly, the Company’s business, financial condition, and results of operations may be influenced by the political, economic, and legal environments in the PRC, as well as by the general state of the PRC economy. 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, regulatory and social conditions in the PRC, and by changes in governmental policies or interpretations with respect to laws and regulations, anti-inflationary measures, currency conversion and remittance abroad, and rates and methods of taxation, among other things.

17 13

~~Security deposit represents various deposits~~Foreign ~~made~~currency toexchange ~~vendors for lease, renovation and other services.~~risk

~~Advances~~The value of RMB against the U.S. dollar and ~~loans~~other ~~are~~currencies ~~amounts~~may ~~advanced~~fluctuate and is affected by, among other things, changes in political and economic conditions and the foreign exchange policy adopted by the PRC government. It is difficult to predict how market forces or ~~lent~~PRC ~~without~~or ~~interest~~U.S. government policy may impact the exchange rate between the RMB and the U.S. dollar in the future. There remains significant international pressure on the PRC government to ~~employees~~adopt a more flexible currency policy, which could result in greater fluctuation of the RMB against the U.S. dollar. We are a holding company and ~~vendors~~we rely on dividends paid by our operating subsidiaries in China for ~~out-~~our cash needs. Any significant revaluation of~~-pocket~~ ~~expenses~~the RMB may materially and adversely affect our liquidity and cash flows. To the extent that we need to convert U.S. dollars into RMB for our operations, appreciation of the RMB against the U.S. dollar would have an adverse effect on the RMB amount we would receive. Conversely, if we decide to convert our RMB into U.S. dollars for other business ~~transactions~~purposes, appreciation of the U.S. dollar against the RMB would have a negative effect on the U.S. dollar amount we would receive.

Proceeds from issuance of convertible notes represent the remaining amount as of June 30, 2017 in the escrow account maintained by Shandong Keyu Law Firm for the issuance of the three-year convertible notes, which was closed on June 30, 2017 (See Note 12 – Convertible notes payable). We received the funds subsequently on July 10, 2017.Reclassification

~~Note~~Certain reclassifications 9have –been ~~Property~~made ~~and~~to ~~equipment,~~the 2016 unaudited condensed consolidated financial statements to confirm to the 2017 unaudited condensed consolidation financial statement presentation. These reclassifications had no effect on net income or cash flows as previously reported.

~~The following is a summary of property~~Reverse ~~and~~Stock ~~equipment~~Split ~~as of June 30, 2017 and December 31, 2016:~~

	June 30,			December 31,
	2017			2016
Office furniture	$	107,557		$	41,855
Electronic equipment		260,409			310,769
Automobile		240,504			—
Leasehold improvement		403,813			387,298
Subtotal		1,012,284			739,922
Less: accumulated depreciation		(545,805	)		(460,514	)
Property and equipment, net	$	466,479		$	279,408

On June 20, 2017, the Board of Directors approved a reverse stock split of the Company’s issued and outstanding shares of common stock, par value $0.001 per share (the “Common Stock”), at a ratio of 1-for-5 (the “Reverse Stock Split”). The Reverse Stock Split was effected by the Company filling a Certificate of Change (the “Certificate”) with the Secretary of State of the State of Nevada on June 20, 2017 (the “Effective Date”). As a result of the filing of the Certificate, the number of shares and of the Company’s authorized Common Stock was reduced from 2,990,000,000 shares to 598,000,000 shares and the issued and outstanding number of shares of the Company’s Common Stock was correspondingly decreased, with no change in par value per share. The Company received FINRA’s approval of the Reverse Stock Split on August 7, 2017. The Company has retroactively restated all shares and per share data for all the periods presented.

~~Depreciation expense for the six months~~Recent ~~ended~~Accounting ~~June 30, 2017 and 2016 were $76,458 and $65,547, respectively. We paid $250,479 and $117,438 for fixed asset acquisition and leasehold improvement during the first half of 2017 and 2016, respectively.~~ Pronouncements

~~There~~In ~~were~~September 2017, nothe ~~events~~FASB orhas ~~changes~~issued inASU ~~circumstances~~No. 2017-13, “Revenue Recognition (Topic 605), Revenue from Contracts with Customers (Topic ~~that~~606), ~~necessitated~~Leases a(Topic ~~review~~840), and Leases (Topic 842): Amendments to SEC Paragraphs Pursuant to the Staff Announcement at the July 20, 2017 EITF Meeting and Rescission of ~~impairment~~Prior SEC Staff Announcements and Observer Comments.” The amendments in ASU No. 2017-13 amends the early adoption date option for certain companies related to the adoption of ~~long~~ASU No. 2014-~~lived~~09 ~~assets~~and asASU No. 2016-02. Both of ~~June~~the 30entities may still adopt using the public company adoption guidance in the related ASUs, ~~2017~~as amended. The effective date is the same as the effective date and transition requirements for the amendments for ASU 2014-09 and ASU 2016-02.

~~Note 10 – Taxes payable~~ 14

~~The~~Note ~~following~~3 is– aShort-term ~~summary of taxes payable as of June 30, 2017 and December 31, 2016:~~investments

	June 30,		December 31,
	2017		2016
Value-added tax	$	167,342	$	194,178
Corporate income tax		2,154,501		996,274
Withholding tax		9,963		27,505
Business & related taxes etc.		57,432		67,203
Taxes payable	$	2,389,238	$	1,285,160

On November 7 and December 16, 2016, in order to increase return of the Company’s excess cash held in banks, the Company entered into two short-term entrusted financial management contracts (the “Contracts”) with Shandong Wenye Investment Co., Ltd. (“Wenye”). The contracts provide that the Company entrusted $7,377,434 (or RMB 50 million) and $1,032,841 (or RMB 7 million) in principal, respectively, to Wenye to make investments in principal guaranteed short-term wealth products for the Company. Balance of the short-term investments was $8,274,306 as of December 31, 2016 including the unrealized gain of these investments. The term of both contracts was for six months and upon maturity of these investments in May and June of 2017, respectively, Wenye repaid the entrusted principals with accumulated investment return of $219,230 (or RMB 1,492,192).

~~Note~~In May 2017, the 11Company –entered ~~Liabilities~~into an agreement with Jiangxi Bank to purchase a principal-guaranteed wealth management product. Principal of the wealth management product is $7,377,434 (or RMB 50 million) and term of the product was for 68 days from ~~risk~~May ~~reserve~~3 ~~fund~~to ~~guarantee~~July 10, 2017 with annualized rate of return of 3.60%. Upon maturity, Jiangxi Bank repaid the investment principal with accumulated investment return of $49,268 (or RMB 335,342) on July 11, 2017.

ToNote ~~minimize~~4 ~~default risk, we offer a private~~– ~~loan~~Accounts risk reserve fund which is 2-5% of the credit extended to the third-party guarantors or borrowers who do not have a guarantor, though a risk reserve fund is not a regulatory requirement. Prior to an application for credit being made on our platform, borrower (or if a guarantor is needed for the borrower, the guarantor) is required to provide an amount equal to 2-5% of the amount being loaned, which shall be deposited directly into the risk reserve account. Under our risk reserve fund arrangement, the risk reserve fund will be refunded to the borrowers (or guarantors) if the loan is paid in full at maturity. The private loan risk reserve is deposited directly into a bank account owned by the company and refunded directly from such bank account. The Company is not restricted to use any of these loan risk reserve fund if needed.receivable

18Accounts receivable include service fees generated through our loan original service and loan repayment service. As of September 30, 2017 and December 31, 2016, the Company has service fee receivable balance of $572,440 and $281,038, respectively, from ChinaPnR.

IfChinaPnR ~~a loan~~ is ~~delinquent for~~ a ~~certain period~~licensed ofthird ~~time,~~party ~~usually~~online ~~within~~payment ~~3 business days~~service, wewho ~~will~~assists ~~withdraw~~us ain ~~sum,~~the ~~equal~~disbursement toand ~~the~~repayment ~~overdue~~of ~~principal~~loans ~~and~~facilitated ~~interest,~~through ~~from~~our ~~the~~online ~~risk reserve~~platform ~~fund~~as towell ~~repay~~as ~~the~~deducts ~~investor~~and ~~(up~~remits service fees to ~~the~~us. ~~total~~ChinaPnR ~~amount~~usually ofremits ~~reserve~~our ~~funds~~service ~~maintained~~fee ~~with~~to usour bybank account on the ~~guarantor~~next orday. The ~~the~~receivable ~~borrower~~balance ~~who~~from ~~does not~~ChinaPnR ~~have~~is adue ~~guarantor).~~to Nothe ~~such~~timing ~~payments~~difference ~~were~~at ~~made~~end ~~from~~of the ~~risk~~periods. ~~reserve~~All ~~fund~~service ~~during~~fee ~~the~~receivable ~~six~~are ~~months~~considered fully ~~June~~collectible ~~30,~~and ~~2017~~no ~~and~~allowance ~~2016~~is deemed necessary.

AsNote of5 ~~June 30, 2017 and December 31, 2016,~~– ~~the~~Short-term ~~balance~~loans ~~of the risk reserve fund amounted to $10,078,847 and $7,297,123, respectively.~~receivable

~~Note~~In 12June –2017, ~~Convertible~~the Company ~~notes~~started to lend entrusted loans through Qingdao Weichuang, a licensed loan provider under the PRC regulations, to SME and individual borrowers in China. As of September 30, 2017, the Company granted entrusted loans in the aggregate principal amount of $35,312,326 (or RMB 235 million) to SME borrowers. The loans are short-term loans with typical loan terms between three and six months, and interest payable on a monthly basis. Interest rates charged are based on negotiation with borrowers, taking into consideration of factors such as duration of the loan, the industry in which the borrower conducts its business, its credit history, financial condition, operating results and cash flows etc.

OnIn ~~June~~connection ~~30,~~with execution ~~2017,~~of the ~~Company~~entrusted ~~entered~~loan ~~into a~~contracts, ~~securities~~each ~~purchase~~borrower ~~agreement~~is ~~(the~~required ~~“Purchase~~to ~~Agreement”)~~engage ~~with~~a ~~certain~~third ~~investors~~party ~~(the “Investors”)~~guarantor, pursuant to which wethe guarantor ~~issued~~has ~~and~~agreed ~~sold~~to ~~senior~~guarantee ~~convertible promissory notes in~~ the ~~aggregate~~obligation ~~principal~~under ~~amount of $13,189,164 (RMB 90,357,317) (~~the ~~“Notes”),~~entrusted ~~convertible~~loan ~~into~~contract. ~~shares~~The ~~of the~~ Company’s ~~common~~pays ~~stock~~a ~~(the~~processing ~~“Common~~fee ~~Stock”)~~equal ~~following~~to ~~June~~0.15% ~~30, 2018 at a conversion price~~ of ~~$2.00~~the ~~per~~aggregate ~~share~~loan ~~(the~~amount ~~“Conversion~~to ~~Price”)~~Qingdao inWeichuang afor ~~private~~facilitating ~~placement~~these ~~(the~~entrusted ~~“Private Placement”)~~loans. The ~~Notes~~sister ~~mature~~of onMr. ~~June~~Bodang 30Liu, our ~~2020~~chief ~~and~~executive ~~accrue~~officer ~~interest~~and ~~at a rate of 6%~~chairman, 7%owns ~~and 8~~48.41% ~~per annum for each~~ of the ~~first, second~~outstanding ~~and~~equity ~~third~~interests ~~year,~~in ~~respectively,~~Qingdao ~~with such interest payable annually~~Weichuang. InFor ~~event of a conversion of~~ the ~~Notes, the Investors~~three ~~have~~and ~~agreed~~nine tomonths aended ~~one~~September ~~year~~30, ~~lock-up~~2017, ~~period with respect to~~ the ~~shares~~processing offee ~~Common~~expense ~~Stock~~paid ~~issuable~~to ~~upon~~Qingdao ~~conversion~~Weichuang ofamounted ~~the~~to ~~Notes~~$38,566 ~~commencing on~~and ~~the applicable conversion date of the Notes~~$48,857, respectively.

Following the first anniversary of the issuance date of Notes, if the closing price of the Common Stock is equal to or greater than 130% of the Conversion Price for 20 business days within a 30 consecutive business day period, the principal and accrued interest under the Notes may be repaid at the option of the Company without penalty or premium. Following the second anniversary of the issuance date of the Notes, if the closing price of the Common Stock is less than 70% of the Conversion Price for 20 business days within a 30 consecutive business day period, and (i) the Company has an effective current registration statement and (ii) the average trading volume of the Common Stock for such prior 30 consecutive business days is at least 10,000 shares, then the Investors may redeem and declare due any or all of the Notes. If this right of redemption is exercised, the interest rate shall be reduced to 3% per annum. The Notes contain various events of default provisions which if breached, may result in the acceleration of all obligations under the Notes.15

The Notes are secured by a pledge of shares of the Common Stock pursuant to a stock pledge agreement (the “Stock Pledge Agreement”) between Avis Genesis Inc., a majority shareholder of the Company, and the Investors on the basis of one share of Common Stock per $1 loaned under the Note~~. Other~~ ~~than~~6 ~~the~~– ~~shares pledged pursuant to the Stock Pledge Agreement, there is no recourse against the Company upon a default of the Notes.~~Prepayments

19The following is a summary of prepayments as of September 30, 2017 and December 31, 2016:

Since the fair value of the common stock into which the above-mentioned note is converted at the date of the Purchase Agreement is same as the conversion price and the average stated interest rate is in line with the market rate, the Company concludes that there is no beneficial conversion feature associated with the Notes.

	September 30,		December 31,
	2017		2016
Prepaid service fees (i)	$	503,198	$	2,071,013
Prepayment for rent		57,163		—
Prepayment for advertising		26,876		—
Down payment for fixed asset		—		7,200
Others		—		713
Prepayments	$	587,237	$	2,078,926

~~Note~~(i) 13We –pay ~~Income~~a ~~taxes~~service fee to third-party service providers based on the amount of loans the service providers refer to us. In April 2016, the Company entered into a cooperation agreement with Shanghai Nami Financial Consulting Co., Ltd (“Nami”), amended in October 2016, pursuant to which Nami will refer potential investors to us, and in turn we will pay Nami a service fee based on the number of new registered investors and the amount of loans extended by the investors it refers to us. To secure and grow the cooperation relationship, the Company agreed to make prepayment to Nami. As of September 30, 2017, the balance of prepaid service fee was $503,198, with $459,598 paid to Nami and $43,598 to other service providers, which are refundable if the service providers fail to refer potential investors to us. For the three and nine months ended September 30, 2017, the referral fee paid to Nami amounted to $4,836,228 and $10,917,505, respectively. For the three and nine months ended September 30, 2016, the referral fee paid to Nami amounted to $2,781,186 and $4,906,807, respectively.

~~The~~Note ~~Company~~7 ~~accounts for income taxes in~~– ~~accordance~~Other with ASC 740: Income Taxes, which requires that the Company recognizes deferred tax liabilities and assets based on the differences between the financial statement carrying amounts and the tax basis of assets and liabilities, using enacted tax rates in effect in the years the differences are expected to reverse. Deferred income tax benefit (expense) results from the change in net deferred tax assets or deferred tax liabilities. A valuation allowance is recorded when, in the opinion of management, it is more likely than not that some or all of any deferred tax assets will not be realized.receivables

~~United~~The ~~States~~following is a summary of other receivables as of September 30, 2017 and December 31, 2016:

Sino Fortune is subject to the U.S. Tax law at tax rate of 34%. No provision for the U.S. federal income taxes has been made as the Company had no U.S. taxable income for the periods presented, and its earnings are permanently invested in PRC.

	September 30,		December 31,
	2017		2016
Security deposit	$	83,373	$	106,489
Business-related advances		821,462		686,360
VAT receivable		175,015		—
Other receivables	$	1,079,850	$	792,849

~~BVI~~Security deposit represents various deposits made to vendors for lease, renovation and other services. Advances and loans are amounts advanced or lent without interest to employees and vendors for out-of-pocket expenses and business transactions.

~~Benefactum~~Note ~~Alliance~~8 ~~is a holding company~~– ~~incorporated~~Investment ~~under~~in ~~the~~equity ~~laws of British Virgin Islands (“BVI”) and under the current laws of BVI, it is not subject to income tax.~~investees

~~Hong~~On ~~Kong~~September 1, 2017, the Company acquired 4.4538% of equity interests in Shenzhen TouZhiJia Financial Information Service Co., Ltd. (“Shenzhen TouZhiJia Financial”) from three individuals with a total cash consideration of $2,870,067 (RMB 19.1 million). The equity interest the Company acquired was held through three limited partnerships wherein each partnership’s sole purpose is to hold the equity interest of Shenzhen TouZhiJia Financial.

~~Benefactum~~For ~~Alliance~~the ~~incorporated Benefactum~~purpose ~~Sino~~of ininvestment, ~~Hong~~the ~~Kong~~Company ~~SAR~~acquired 35.1%, ~~which~~61.7% isand ~~subject~~65.54% toequity ~~Hong~~interests ~~Kong~~of ~~profit~~these ~~tax.~~three ~~The~~limited ~~applicable~~partnerships, ~~statutory~~respectively, which ~~tax~~represent ~~rate~~1.4259%, is0.7175% 16and 2.53104% of the ownership interest in Shenzhen TouZhiJia Financial, respectively. NoDue ~~provision~~to ~~for~~the fact ~~Hong~~that the only asset in these limited partnerships are their equity investments in Shenzhen TouZhiJia Financial, the Company ~~Kong~~believes ~~income~~that ~~taxes~~the ~~has~~acquisition ~~been~~of ~~made~~the equity interest of these limited partnership constitute as ~~Benefactum~~an ~~Sino~~acquisition ~~had~~of noan ~~taxable~~asset ~~income~~rather than ~~for~~an acquisition of a business. The Company doesn’t have significant influence nor control over Shenzhen TouZhiJia Financial. The equity interest in Shenzhen TouZhiJia Financial does not have readily determinable fair value. As a result, the ~~periods~~Company ~~presented~~accounted for this investment under cost method. As of September 30, 2017, no impairment loss was recognized.

~~China~~16

~~Benefactum~~ Shenzhen ~~and~~TouZhiJia Financial’s ~~Benefactum~~main ~~Beijing were~~businesses ~~incorporated~~include invertical ~~PRC~~Peer-to-Peer (“P2P”) search engine, private wealth management and secondary ~~are~~loan ~~subject~~exchange toservices. ~~income~~Shenzhen ~~taxes~~TouZhiJia onFinancial, ~~income~~as ~~arising~~a inservice orprovider, ~~derived~~refers ~~from~~potential ~~the~~investors ~~PRC~~to inthe ~~which~~Company through ~~they~~online ~~are~~channel ~~domiciled~~(Note 12). The ~~applicable~~Company ~~statutory~~believes ~~tax~~this isinvestment ~~25%~~could offer new opportunities for operational synergies in the financial information service industry.

~~The~~Note ~~provision~~9 ~~for income taxes consists~~– ofTaxes ~~the following for the three and six months ended June 30, 2017 and 2016:~~payable

20The following is a summary of taxes payable as of September 30, 2017 and December 31, 2016:

	Three Months Ended June 30,				Six Months Ended June 30,
	September 30,		December 31,
Current:	2017		2016		2017		2016
	2017		2016
United States	$	—	$	—	$	—	$	—
Value-added tax	$	300,632	$	194,178
Hong Kong		—		—		—		—
Corporate income tax		3,615,689		996,274
China		874,377		—		1,516,105		121,489
Withholding tax		14,875		27,505
Total current provision	$	874,377	$	—	$	1,516,105	$	121,489
Business & related taxes		70,874		67,203
Taxes payable	$	4,002,070	$	1,285,160

~~Benefactum~~Note ~~Shenzhen~~10 ~~had no taxable income~~– ~~for~~Liabilities ~~the~~from ~~periods~~risk ~~presented,~~reserve ~~while~~fund ~~significant components of income tax provision for Benefactum Beijing were as follows for the three and six months ended June 30, 2017 and 2016:~~guarantee

	Three Months Ended June 30,						Six Months Ended June 30,
	2017			2016			2017			2016
Income before provision for income taxes	$	3,767,128		$	(414,710	)	$	6,402,144		$	1,172,479
PRC statutory rate of 25%	$	941,782		$	—		$	1,600,536		$	293,120
Non-deductible expense and adj. per PRC tax code		(67,405	)		—			(84,431	)		125,526
Net loss carry forward		—			—			—			(297,156	)
Income tax provision	$	874,377		$	—		$	1,516,105		$	121,489

To minimize default risk, we offer a private loan risk reserve fund which is 2-5% of the credit extended to the third-party guarantors or borrowers who do not have a guarantor, though a risk reserve fund is not a regulatory requirement. Prior to an application for credit being made on our platform, borrower (or if a guarantor is needed for the borrower, the guarantor) is required to provide an amount equal to 2-5% of the amount being loaned, which shall be deposited directly into the risk reserve account. Under our risk reserve fund arrangement, the risk reserve fund will be refunded to the borrowers (or guarantors) if the loan is paid in full at maturity. The private loan risk reserve is deposited directly into a bank account owned by the company at a third party depository institution and can be refunded directly from such bank account. The Company is not restricted to use any of these loan risk reserve fund if needed.

	Three Months Ended June 30,					Six Months Ended June 30,
		2017		2016		2017		2016
Deferred:
United States	$	—	$	—	$	—	$	—
Hong Kong		—		—		—		—
China		—		—		—		—
Total deferred provision	$	—	$	—	$	—	$	—

If a loan is delinquent for a certain period of time, usually within 3 business days, we will withdraw a sum, equal to the overdue principal and interest, from the risk reserve fund to repay the investor (up to the total amount of reserve funds maintained with us by the guarantor of the default loan or the borrower who does not have a guarantor). No such payments were made from the risk reserve fund during the three and nine months September 30, 2017 and 2016.

~~Note~~The 14following ~~– Stockholders’~~is ~~equity~~a roll-forward of the private loan risk reserve fund for the nine months ended September 30, 2017 and 2016:

In June 2017, the Board of Directors approved a reverse stock split of the Company’s issued and outstanding shares of common stock at a ratio of 1-for-5. The reverse stock split was effected by the Company filing a Certificate of Change with the Secretary of State of the State of Nevada on June 20, 2017. The issued and outstanding number of shares has been retroactively restated to reflect this reverse stock split.

Private loan risk reserve	2017			2016
Balance at beginning of period	$	7,297,123		$	5,410,913
Increase for new loans		26,856,281			19,734,407
Refund for loan payoffs		(21,492,187	)		(17,931,427	)
Withdrawals for delinquent loans		—			—
Repayments for delinquent loans		—			—
Effect of exchange rate change		440,073			(169,128	)
Balance at end of period	$	13,101,290		$	7,044,765

~~Note 15 – Subsequent event~~17

OnNote ~~July~~11 ~~6, 10 and 20, 2017, the Company,~~– asConvertible ~~the~~notes trustor and provider of funds to the trustee, entered into various entrusted loan contracts with Qingdao Weichuang, as trustee and direct lender to the borrowers, to grant entrusted loans in the aggregate principal amount of $19,181,329 (RMB 130 million) to thirteen SME borrowers. The entrusted loans are short-term loans between three and six months with interest payable on a monthly basis. Each of the loans are guaranteed by financing guarantors and the Company pays a processing fee equal to 1.5‰ of the aggregate loan amount to Qingdao Weichuang for issuing the entrusted loans.

~~For~~On ~~purpose~~June of30, ~~preparing~~2017, the ~~these~~Company ~~unaudited condensed~~entered ~~consolidated~~into ~~financial~~a ~~statements~~securities purchase agreement (the “Purchase Agreement”) with certain investors (the “Investors”), pursuant to which we issued and sold senior convertible promissory notes in the ~~Company~~aggregate ~~considered~~principal ~~events~~amount ~~through~~of ~~August~~$13,189,164 14(RMB 90,357,317) ~~2017~~(the “Notes”), ~~which~~convertible isinto shares of the ~~date~~Company’s common stock (the ~~consolidated~~“Common Stock”) ~~financial~~following ~~statements~~June ~~were~~30, ~~available~~2018 ~~for~~at ~~issuance~~a conversion price of $2.00 ~~Except~~per share (the “Conversion Price”) in a private placement (the “Private Placement”). The Notes mature on June 30, 2020 and accrue interest at a rate of 6%, 7% and 8% per annum for each ~~those~~of ~~disclosed~~the ~~above~~first, ~~there~~second ~~were~~and nothird ~~material~~year, ~~subsequent~~respectively, ~~events~~with ~~that~~such interest payable annually. In event of a conversion of the Notes, ~~required~~the ~~recognition~~Investors orhave ~~additional~~agreed ~~disclosure~~to ina ~~these~~one ~~consolidated~~year ~~financial~~lock-up ~~statements~~period with respect to the shares of Common Stock issuable upon conversion of the Notes commencing on the applicable conversion date of the Notes.

21Following the first anniversary of the issuance date of Notes, if the closing price of the Common Stock is equal to or greater than 130% of the Conversion Price for 20 business days within a 30 consecutive business day period, the principal and accrued interest under the Notes may be repaid at the option of the Company without penalty or premium. Following the second anniversary of the issuance date of the Notes, if the closing price of the Common Stock is less than 70% of the Conversion Price for 20 business days within a 30 consecutive business day period, and (i) the Company has an effective current registration statement and (ii) the average trading volume of the Common Stock for such prior 30 consecutive business days is at least 10,000 shares, then the Investors may redeem and declare due any or all of the Notes. If this right of redemption is exercised, the interest rate shall be reduced to 3% per annum. The Notes contain various events of default provisions, which, if breached, may result in the acceleration of all obligations under the Notes.

~~Item~~The 2Notes are secured by a pledge of shares of the Common Stock pursuant to a stock pledge agreement (the “Stock Pledge Agreement”) between Avis Genesis Inc., ~~Management’s~~a ~~Discussion~~majority shareholder of the Company, and ~~Analysis~~the Investors on the basis of ~~Financial~~one ~~Condition~~share ~~and~~of ~~Results~~Common Stock per $1 loaned under the Note. Other than the shares pledged pursuant to the Stock Pledge Agreement, there is no recourse against the Company upon a default of ~~Operations~~the Notes.

~~CAUTIONARY~~Since ~~NOTE~~the ~~REGARDING~~fair ~~FORWARD~~value of the common stock into which the above-~~LOOKING~~mentioned ~~STATEMENTS~~note is converted at the date of the Purchase Agreement is same as the conversion price and the average stated interest rate is in line with the market rate, the Company concludes that there is no beneficial conversion feature associated with the Notes. For the three and nine months ended September 30, 2017, the financing expense amounted to $199,464 and $348,252, respectively.

~~This~~Note ~~Quarterly~~12 ~~Report~~– onRelated ~~Form~~party 10-Q or Form 10-Q and other reports filed by us from time to time with the Securities and Exchange Commission (collectively the “Filings”) contain or may contain forward-looking statements and information that are based upon beliefs of, and information currently available to, our management as well as estimates and assumptions made by our management. When used in the filings the words “anticipate”, “believe”, “estimate”, “expect”, “future”, “intend”, “plan” or the negative of these terms and similar expressions as they relate to us or our management identify forward-looking statements. Such statements reflect the current view of our management with respect to future events and are subject to risks, uncertainties, assumptions and other factors as they relate to our industry, our operations and results of operations, and any businesses that we may acquire. Should one or more of the events described in these risk factors materialize, or should our underlying assumptions prove incorrect, actual results may differ significantly from those anticipated, believed, estimated, expected, intended or planned.transaction

~~Although we believe~~On ~~that~~September ~~the~~1, ~~expectations~~2017, ~~reflected in~~ the ~~forward~~Company ~~looking~~acquired ~~statements~~4.4538% ~~are~~of ~~reasonable,~~equity weinterests ~~cannot~~in ~~guarantee~~Shenzhen ~~future~~TouZhiJia ~~results~~Financial, ~~levels~~which ~~of activity,~~refers ~~performance~~potential orinvestors to ~~achievements.~~the ~~Except~~Company asthrough ~~required~~online bychannel ~~applicable~~(Note ~~law, including the U~~8).S. ~~federal~~The ~~securities~~Company ~~laws~~incurred $136,110 wereferral ~~do not~~service ~~intend~~expense to ~~update~~Shenzhen ~~any~~TouzhiJia ofFinancial for the ~~forward-looking~~period ~~statements~~from toSeptember ~~conform~~1 ~~them~~ to ~~actual~~September ~~results~~30, 2017. ~~The~~As ~~following~~of ~~discussion~~September ~~should~~30, ~~be read~~2017, inthe ~~conjunction~~referral ~~with~~service ~~our~~fee ~~pro~~payable ~~forma~~to ~~financial~~Shenzhen TouZhiJia ~~statements~~Financial ~~and~~was ~~the related notes that will be filed herein~~$601,638.

~~Overview~~18

WeNote ~~are~~13 a– ~~holding~~Income company that, through our wholly-owned subsidiaries, Benefactum Alliance, Benefactum Sino and Benefactum Shenzhen and our contractually controlled and managed company, Benefactum Beijing, operates an electronic online financial platform, www.hyjf.com, which is designed to match investors with SME and individual borrowers in China. We believe our services provide an effective financial credit facility solution to under-served SME and individual borrowers. In addition, our online financial platform provides investors with attractive returns ranging from 6.5%-12% based on the amount and term of different investment. Investors have the option to individually select specific loans to invest in. We also set aside risk reserve fund with the aim of limiting losses to investors from borrower defaults. In addition, we provide investors with access to a liquid secondary market, giving them an opportunity to exit their investments before the underlying loans become due.taxes

22The Company accounts for income taxes in accordance with ASC 740: Income Taxes, which requires that the Company recognizes deferred tax liabilities and assets based on the differences between the financial statement carrying amounts and the tax basis of assets and liabilities, using enacted tax rates in effect in the years the differences are expected to reverse. Deferred income tax benefit (expense) results from the change in net deferred tax assets or deferred tax liabilities. A valuation allowance is recorded when, in the opinion of management, it is more likely than not that some or all of any deferred tax assets will not be realized.

~~Due~~United to PRC legal restrictions on foreign ownership and investment in, among other areas, value-added telecommunications services, which include internet content providers, or ICPs, we, similar to all other entities with foreign-incorporated holding company structures operating in our industry in China, have to operate our internet businesses and other businesses in which foreign investment is restricted or prohibited in the PRC through wholly foreign-owned enterprises, majority-owned entities and variable interest entities. Accordingly, we operate our online financial platform in China through Benefactum Beijing, which was founded in September 2013.States

WeThe ~~generate~~Company ~~revenue~~is ~~from~~subject to ~~our~~the ~~services~~U.S. ~~that~~Tax ~~facilitate~~law ~~matching investors~~at ~~with~~tax ~~individual~~rate ~~and~~of ~~SME~~34%. ~~borrowers~~No ~~through~~provision ~~our~~for ~~online~~the ~~platform~~U.S. ~~The~~federal ~~Company’s~~income ~~revenues~~taxes ~~are~~has ~~composed~~been ofmade ~~fees~~as ~~collected from~~the ~~services~~Company ~~provided~~had ~~with~~no ~~facilitating~~U.S. taxable ~~loan~~income ~~originations~~for ~~and~~the ~~services~~periods ~~provided~~presented, ~~with~~and ~~assisting~~its inearnings ~~repayment~~are ~~process~~permanently ~~through~~invested ~~our online~~in ~~platform~~PRC.

~~Loan Origination Service Fee~~BVI

~~For~~Benefactum ~~our services that~~Alliance ~~match~~is ~~investors and borrowers through our online platform, we charge~~ a ~~service~~holding ~~fee~~company ~~from~~incorporated ~~borrowers~~under ~~for~~the ~~each~~laws ~~effected~~of ~~loan~~British ~~facilitated by~~Virgin ~~us,~~Islands ~~which~~(“BVI”) ~~is accounted for as revenue,~~ and ~~immediately~~under ~~deducted from~~ the ~~proceeds~~current tolaws ~~the~~of ~~borrowers when a loan is initiated.~~BVI, ~~The~~it ~~service fee~~ is ~~1.5%-3.0%~~not ofsubject ~~the~~to ~~total~~income ~~amount of each loan, depending on the duration of the loan~~tax.

~~Loan~~Hong ~~Repayment Management Fee~~Kong

~~For~~Benefactum ~~our~~Alliance incorporated ~~services~~Benefactum ~~that~~Sino ~~assist~~ in ~~repayments~~Hong ofKong ~~outstanding loans through our online platform~~SAR, ~~we charge a separate fee from borrowers for each loan repayment facilitated by us,~~ which is ~~accounted~~subject ~~for as revenue, and immediately remitted~~ to usHong ~~when~~Kong aprofit ~~loan matures and borrower repays the loan~~tax. The ~~loan~~applicable ~~repayment~~statutory ~~management~~tax ~~fee~~rate is 16.5%. ~~based~~No onprovision anfor ~~agreed~~Hong ~~upon~~Kong ~~percentage around~~income ~~0.3%~~taxes onhas ~~the~~been ~~borrowing~~made ~~times~~as ~~the~~Benefactum ~~duration~~Sino ofhad ~~the~~no ~~loan~~taxable ~~and~~income isfor ~~not~~the ~~refundable~~periods presented.

~~Important Factors Affecting Our Results of Operations~~China

~~Major~~Benefactum Shenzhen ~~factors~~and ~~affecting~~Benefactum Beijing were incorporated in PRC and are subject to income taxes on income arising in or derived from ~~our~~the ~~results~~PRC in which they are domiciled. The applicable statutory tax is 25%. Qianhai and Puhui are located in Xinjiang Huoerguosi Economic Development Zone and enjoy five-year income tax exemption starting from their first profitable year in 2017, followed by a reduced income tax rate of ~~operations~~12.5% ~~include~~for the ~~following:~~subsequent five years.

●The ~~Economic~~provision ~~Conditions~~for income intaxes ~~China~~consists of the following for the three and nine months ended September 30, 2017 and 2016:

The demand for online financing marketplace services from borrowers and investors is dependent upon overall economic conditions in China. General economic factors, including the interest rate environment and unemployment rates, may affect borrowers’ willingness to seek loans and investors’ ability and desire to invest in loans. For example, significant increases in interest rates could cause potential borrowers to defer obtaining loans as they wait for interest rates to become stable or decrease. Additionally, a slowdown in the economy, such as a rise in the unemployment rate and a decrease in real income, may affect individuals’ level of disposable income. This may negatively affect borrowers’ repayment capability, which in turn may decrease their willingness to seek loans or potentially cause an increase in default rates. If actual or expected default rates increase generally in China or the online financing market, investors may delay or reduce their investments in loan products in general, including on our marketplace.

	Three Months Ended September 30,				Nine Months Ended September 30,
Current:	2017		2016		2017		2016
United States	$	—	$	—	$	—	$	—
Hong Kong		—		—		—		—
China		1,405,154		503,232		2,921,258		624,721
Current provision		1,405,154		503,232		2,921,258		624,721

Deferred:
United States		—		—		—		—
Hong Kong		—		—		—		—
China		—		—		—		—
Deferred provision		—		—		—		—
Total provision for income taxes	$	1,405,154	$	503,232	$	2,921,258	$	624,721

~~● Ability to Acquire Borrowers and Investors Effectively~~19

~~Our ability to increase~~Reconciliations of the ~~loan~~differences ~~volume~~between ~~facilitated~~the ~~through~~PRC ~~our~~statutory ~~marketplace~~income ~~largely~~tax ~~depends~~rate ~~on our ability to attract potential borrowers~~ and ~~investors through~~the ~~sales~~Company’s ~~and~~income ~~marketing~~tax ~~efforts.~~provision ~~Our~~for ~~sales~~the ~~and~~three ~~marketing efforts include those related to borrower~~ and ~~investor acquisition~~nine ~~and~~months ~~retention,~~ended ~~and~~September ~~general~~30, ~~marketing.~~2017 ~~We intend to continue to dedicate significant resources to our sales~~ and ~~marketing~~2016 ~~efforts and~~are ~~constantly~~as ~~seek to improve the effectiveness of these efforts, in particular with regard to borrower and investor acquisition.~~follows:

We attract borrowers and investors primarily through our own platform and referrals from third parties. The general public may get access to our platform and submit a borrower profile online. We also acquire borrowers through referrals from financial institutions we partner with. We currently have 15 third-party cooperative partners, consisting of pawn shops, micro-credit company, asset management company, financial leasing company and guarantee companies that frequently serve as guarantors of loans on our platform. Additionally, besides our own sales and marketing efforts to attract investors on our platform, we signed cooperation agreements with various referral service providers, pursuant to which they will refer potential investors to us for a service fee based on number of investors referred and the amount of loans taken by referred investors.

	Three Months Ended September 30,					Nine Months Ended September 30,
	2017			2016		2017			2016
Income before provision for income taxes	$	6,164,510		$	1,961,785	$	12,566,653		$	3,134,264
PRC statutory rate of 25%	$	1,541,128		$	490,446	$	3,141,664		$	783,566
Tax holiday effect and others		(135,974	)		—		(220,405	)		—
Non-deductible expense and others per PRC tax code		—			12,786		—			—
Net loss carry forward		—			—		—			(158,845	)
Income tax provision	$	1,405,154		$	503,232	$	2,921,258		$	624,721

23For the three months ended September 30, 2017, the tax holiday effect on basic and diluted net income per share were $0.0019 per share and $0.0017 per share, respectively. For the three months ended September 30, 2016, the tax holiday effect on basic and diluted net income per share were both $0.003 per share.

●Note ~~Effectiveness~~14 of– Stockholders’ ~~Risk Management~~equity

WeIn ~~manage~~June ~~credit~~2017, ~~risk~~the onBoard ~~behalf~~of Directors approved a reverse stock split of the ~~investors~~Company’s ~~primarily~~issued inand outstanding shares of common stock at a ratio of 1-for-5. The Company effected the ~~following~~reverse ~~ways:~~stock split through filing a Certificate of Change with the Secretary of State of the State of Nevada on June 20, 2017. The issued and outstanding number of shares has been retroactively restated to reflect this reverse stock split.

~~Our~~Note ~~ability~~15 to– Earnings ~~effectively~~per segment borrowers into appropriate risk profiles affects our ability to offer attractive pricing to borrowers as well as our ability to offer investors attractive returns, both of which directly relate to the level of user confidence in our marketplace.share

●The Wefollowing ~~evaluate~~table sets forth the ~~borrower’s~~computation ~~repayment~~of ~~ability~~basic ~~via our pre-transaction credit assessment~~ and ~~fraud~~diluted ~~detection~~net ~~using~~income ~~our~~per ~~big~~share ~~data~~for ~~credit~~the ~~assessment~~three ~~system.~~and ~~Potential~~nine ~~borrowers~~months ~~who~~ended doSeptember ~~not~~30, ~~meet~~2017 ~~our credit assessment grade are denied;~~and 206:

● We offer a risk reserve fund which is 2-5% of the credit extended to the borrowers;

	Three Months Ended September 30,				Nine Months Ended September 30,
	2017		2016		2017		2016
Numerator:
Net income - basic	$	4,759,356	$	1,458,553	$	9,645,395	$	2,509,543
Reversal of financing expense on convertible note payable		199,464		—		348,252		—
Net income - diluted		4,958,820	$	1,458,553	$	9,993,647	$	2,509,543

Denominator:
Weighted average number of shares - basic		72,364,178		67,500,000		72,364,178	$	67,500,000
Conversion of convertible note payable		6,594,582		—		2,230,421		—
Weighted average number of shares - diluted		78,958,760		67,500,000		74,594,599		67,500,000

Net income per share - basic	$	0.07	$	0.02	$	0.13	$	0.04
Net income per share - diluted	$	0.06	$	0.02	$	0.13	$	0.04

~~● Each loan transaction facilitated on our platform is guaranteed by a third party guarantor who is jointly and severally liable for the loan and/or secured by collateral provided by borrowers;~~20

●Note 16 ~~Additionally,~~–Concentrations ~~our risk control department monitors the borrowers’ financial activities~~ and condition post funding. In the event of any material development resulting in a negative turn in a borrower’s financial standing and potential ability to repay its loan, our management will determine the proper action to take to avert or minimize the risk of non-payment.Risks

~~● Ability to Innovate~~ChinaPnR

~~Our growth to date~~We ~~has~~have incontracted ~~part~~with ~~depended~~a ~~on,~~licensed ~~and~~third ~~our~~party ~~future~~online ~~success~~payment ~~will~~service, ~~depend on~~ChinaPnR, ~~successfully~~to ~~meeting~~assist ~~borrower~~in ~~and~~the ~~investor~~disbursement ~~demand with new~~ and ~~innovative~~ ~~loan~~repayment ~~and~~of ~~investment products~~loans. ~~We have made and intend to continue to make efforts to develop loan and investment products~~ ~~for~~Both ~~borrowers~~investor and ~~investors.~~borrower Wewould ~~regularly~~open ~~evaluate~~accounts ~~the~~with ~~popularity~~ChinaPnR ~~of our existing product offerings~~ and ~~develop~~authorize ~~new~~ChinaPnR ~~products and services that cater~~ to ~~the~~manage ~~ever~~their ~~evolving needs of our borrowers and investors~~accounts. ~~Over~~The ~~time~~investor we will ~~continue to expand our offerings~~ byfund ~~introducing~~the ~~new~~loan ~~products.~~amount ~~From~~in ~~the~~his/her ~~borrower~~account ~~perspective~~under ChinaPnR, wewhich ~~will~~would ~~continue~~then todisburse ~~develop~~this ~~tailored~~loan ~~credit~~amount ~~products~~ to ~~meet~~ the ~~specific needs~~borrower net of our ~~target borrowers. We plan to expand our ability to implement risk-based pricing by developing more pricing grades~~ toloan ~~optimize~~origination ~~loans~~service ~~based~~fees onwhich ait ~~borrower’s~~will ~~credit~~remit ~~criteria, enabling us~~ to ~~facilitate customized loans tailored to borrowers’ specific credit profiles~~us.

●When the ~~Regulatory~~borrower ~~Environment~~repays inthe ~~China~~loan to ChinaPnR, he/she will deposit the loan repayment management fee along with the principal loan amount and interest. ChinaPnR will then disburse the principal loan amount and interest back to investor and loan repayment management service fee to us.

~~The~~Currently, investors ~~regulatory~~are ~~environment~~ not charged for the ~~peer-to-peer~~service ~~lending~~provided ~~service~~by ~~industry~~ChinaPnR. inHowever, ~~China~~individual isborrowers ~~developing~~are ~~and~~charged ~~evolving,~~a ~~creating~~processing ~~both~~fee ~~challenges~~by ChinaPnR ~~and~~in ~~opportunities~~the ~~that could~~amount ~~affect~~of ~~our~~0.11% ~~financial~~to ~~performance~~0.25% ~~Due~~(which tovaries depending on the ~~relatively~~bank ~~short~~they ~~history~~use) of the ~~peer-to-peer~~loan ~~lending~~amount ~~service~~when ~~industry~~it inis ~~China,~~deposited ~~although~~in ~~PRC~~their ~~governmental~~ChinaPnR ~~officials~~account. ~~from~~For aSME ~~number~~borrowers, ofthey ~~agencies~~pay ~~and~~RMB ~~departments~~10 ~~have~~per ~~recently~~deposit. ~~expressed~~When ~~support~~borrowers ~~for~~withdraw ~~the~~money ~~development of~~from ~~this~~their ~~service~~ChinaPnR account, they would have ~~also~~to ~~expressed~~pay ~~the~~a ~~need~~processing ~~for~~fee ~~strengthening~~of 0.05% of the ~~regulation~~withdrawing ~~and~~amount ~~supervision~~plus ofRMB1 or just RMB1, depending on how soon they wish for the ~~industry~~withdrawal to ~~protect~~be ~~investors~~effected. As aWhen ~~result,~~ the ~~PRC~~loan ~~government~~ is inrepaid ~~the~~to ~~process~~ChinaPnR, ofit ~~building~~will adisburse ~~regulatory~~the ~~framework~~loan ~~governing~~and ~~our~~interest ~~industry~~back to investor.

~~We will continue to~~Jiangxi make efforts to ensure that we are compliant with the existing laws, regulations and governmental policies relating to our industry and to comply with new laws and regulations or changes under existing laws and regulations that may arise in the future. While new laws and regulations or changes to existing laws and regulations could make loans more difficult to be accepted by investors or borrowers on terms favorable to us, or at all, these events could also provide new product and market opportunities.Bank

24In February 2017, the CBRC released the Guidance to regulate funds depositories for online lending intermediaries. The Guidance defines depositories as commercial banks that provide online lending fund depository services. In compliance with the regulatory requirement, we engaged Jiangxi Bank, a qualified banking financial institution, in March 2017 as our funding depository service provider. Relevant Chinese regulations require us to enter into fund depository agreement with only one commercial bank to provide fund depository services. Upon successful system transition from ChinaPnR to Jiangxi Bank in July 2017, Jiangxi Bank started to assist in the disbursement and repayment of loans. Both investors and the borrowers open accounts with Jiangxi Bank and authorize Jiangxi Bank to manage their accounts. The investor funds the loan amount in his/her account with Jiangxi Bank, which disburses loan amount to the borrower net of our service fees, which is remitted to us. When the borrower repays the loan to Jiangxi Bank, they deposit the loan repayment management fee along with the principal loan amount and interest. Jiangxi Bank then disburses the principal loan amount and interest back to the investor and remits the repayment management fee to us.

~~Results~~Currently, investors are not charged for deposits made to their accounts in Jiangxi Bank. Borrowers are charged a processing fee by Jiangxi Bank in the amount of ~~Operations~~0.10% (with a minimum of RMB 2) of the loan amount when the funds are deposited into the borrower’s Jiangxi Bank account. When borrowers and investors withdraw money from their Jiangxi Bank accounts, they pay a processing fee of RMB 1 per transaction.

~~Three~~Foreign currency ~~Months~~risk ~~Ended June 30, 2017 and 2016~~

The Company ~~following~~maintains ~~table sets~~certain ~~forth~~bank aaccounts ~~breakdown~~in ofthe ~~revenue~~PRC ~~for~~which ~~the~~are ~~periods~~not ~~indicated,~~insured ~~both~~by Federal Deposit Insurance Corporation (“FDIC”) insurance or other insurance. Cash and cash equivalents balance held in ~~dollar~~PRC ~~amount~~bank accounts was $12,942,309 and $8,561,695 as aof September ~~percentage~~30, 2017 and December 31, 2016, respectively, of ~~total~~which ~~revenues~~no deposits were covered by insurance. ~~The~~For ~~information~~the three and nine ~~should~~months beended ~~read~~September ~~together~~30, ~~with~~2017 ~~our~~and ~~unaudited~~2016, ~~condensed~~all ~~consolidated~~of ~~interim~~the ~~financial~~Company’s ~~statements~~assets and ~~related~~operations ~~notes~~were ~~included~~located ~~elsewhere~~ in ~~this~~the ~~report~~PRC and all of the Company’s revenues were derived from the PRC.

	Three Months Ended June 30,
	2017					2016
	Amount		% of Total			Amount		% of Total
Loan origination service fee	$	6,470,554		60	%	$	4,090,169		71	%
Loan repayment management fee		4,328,292		40	%		1,657,236		29	%
Total	$	10,798,846		100	%	$	5,747,405		100	%

~~Revenue~~Concentrations risk

~~Our~~No customer ~~revenues~~accounted for ~~the~~more ~~three~~than ~~months~~10% ~~ended June 30, 2017 and 2016 consists~~ of ~~loan~~revenues origination service fees and repayment management fees we charge borrowers on the loans facilitated through our online platform. The online Peer-to-Peer lending platform industry has experienced rapid growth in China in recent years, coupled with the increased marketing campaigns, promotion activities on our platform and brand awareness of our online marketplace, our revenue increased from approximately $5.75 million for the three ~~months~~and ~~ended~~nine ~~June 30, 2016 to approximately $10.80 million for the three~~ months ended ~~June~~September 30, 2017, ~~reflecting an~~and increase of 88%, of which 97% is attributable to the substantial increase in the volume of loans facilitated through our platform, partially offset by the exchange rate effect of depreciating RMB against USD. Loans facilitated through our platform increased from approximately RMB 1.11 billion in the three months ended June 30, 2016 ~~to approximately RMB 2~~.~~12 billion in the same period in 2017, a 91% increase.~~

~~Specifically, loan~~91% ~~origination~~and ~~service fee increased by approximately $2.38 million, or 58~~83%, toof ~~approximately $6.47 million for~~ the ~~second~~loans ~~quarter of~~facilitated ~~2017~~through ~~from~~our ~~approximately~~platform ~~$4.09 million~~ for the ~~same~~three ~~period~~and ofnine ~~last~~months ~~year.~~ended ~~Loan~~September ~~repayment management fee increased by approximately $2.67 million~~30, ~~or 161%, to approximately $4.33 million for the second quarter of~~ 2017 ~~from~~were ~~approximately~~referred ~~$1.66 million for the~~through ~~same~~three ~~period of last year. Loan origination service fee~~ and ~~repayment~~two ~~management~~investor ~~fee~~referral ~~accounted for 60% and 40% of our revenue for the second quarter of 2017~~groups, respectively,. ~~as compared to 71~~88% and 2958% ~~in the same period~~ of ~~2016. The change is due to~~ the ~~shift in~~loans ~~structure~~facilitated ofthrough our ~~loan~~platform ~~products~~for ~~towards longer duration loans. Since our loan repayment management fee is based on a certain percentage of~~ the ~~borrowing times duration of a loan, the more loans with longer terms, the more loan repayment management fees~~three weand ~~generate.~~nine ~~Loans that mature in two~~ months ~~or less accounted for only 24% of total loans for the three months~~ ended ~~June~~September 30, ~~2017,~~ ~~as compared to 50% in the same period of~~ 2016, ~~while~~respectively, ~~loans~~were ~~with~~referred athrough ~~term~~one ofinvestor ~~three~~referral ~~months~~group. orAny ~~more~~loss ~~increased from 50%~~ of ~~total~~referrals ~~loans~~from ~~for~~these ~~the~~referral ~~three~~groups ~~months~~may ~~ended~~have ~~June~~a ~~30,~~material ~~2016~~impact toon ~~76% in~~ the ~~same~~Company’s ~~period~~operation ~~of 2017~~results.

~~Operating~~Note 17 ~~Expenses~~– Subsequent event

~~Our~~For purpose ~~total~~of ~~operating expenses~~preparing ~~increased~~these ~~from~~unaudited ~~approximately~~condensed ~~$6.17~~consolidated ~~million~~financial instatements, the ~~second~~Company ~~quarter~~considered ofevents ~~2016~~through ~~to approximately $7.24 million in the same period~~November of14, 2017, ~~an increase of 18%, of~~ which ~~negative~~is 5%the isdate ~~due~~the toconsolidated ~~exchange~~financial ~~rate~~statements ~~effect~~were ofavailable ~~depreciating~~for ~~RMB~~issuance. ~~against~~Except ~~USD,~~for ~~with~~those ~~the~~disclosed ~~rest~~above, ~~being~~there ~~primarily~~were ~~attributable~~no tomaterial ~~the~~subsequent ~~increase~~events inthat ~~sales~~required ~~and~~recognition ~~marketing~~or ~~expenses,~~additional ~~which~~disclosure ~~increased~~in bythese ~~24%~~consolidated ~~from~~financial ~~the same period last year~~statements.

~~The following table sets forth the main components of our operating expenses for the three months ended June 30, 2017 and 2016:~~ 22

	Three Months Ended June 30,
	2017					2016
		Amount	% of Total				Amount	% of Total
Sales & Marketing Expenses	$	5,462,811		75.4	%	$	4,611,987		74.8	%
General & Administrative Expenses		1,713,915		23.7	%		1,508,766		24.5	%
Business & related taxes		21,322		0.3	%		13,806		0.2	%
Depreciation		46,763		0.6	%		31,185		0.5	%
Total Operating Expenses	$	7,244,811		100	%	$	6,165,744		100	%

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

25CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

~~Our~~This Quarterly ~~sales~~Report ~~and~~on ~~marketing expenses~~Form ~~increased~~10-Q byor ~~18%~~Form ~~(24%~~10-Q ~~after~~and ~~excluding~~other ~~exchange~~reports ~~rate~~filed ~~effect)~~by us from ~~approximately~~time ~~$4.61~~to ~~million~~time inwith the ~~second~~Securities ~~quarter~~and ofExchange Commission ~~2016~~(collectively ~~to approximately $5.46 million in~~ the ~~second~~“Filings”) ~~quarter~~contain ofor ~~2017.~~may ~~The~~contain ~~increase~~forward-looking ~~was~~statements ~~primarily~~and ~~due~~information tothat ~~the~~are ~~increase~~based ~~in expenses associated~~upon ~~with~~beliefs ~~sales~~of, and ~~marketing~~information ~~efforts~~currently ~~and~~available ~~promotion~~to, ~~activities~~our ~~resulting~~management inas ~~higher~~well ~~volume~~as ofestimates ~~loans~~and ~~facilitated~~assumptions ~~through~~made by our ~~platform~~management. ~~Our~~When ~~general~~used ~~and~~in ~~administrative~~the ~~expenses~~filings ~~increased~~the bywords ~~14%~~“anticipate”, ~~(19%~~“believe”, ~~after~~“estimate”, ~~excluding~~“expect”, “future”, ~~exchange~~“intend”, ~~rate~~“plan” ~~effect)~~or ~~from approximately $1.51 million in~~ the ~~second~~negative ~~quarter~~ of ~~2016~~these toterms ~~approximately~~and ~~$1.71~~similar ~~million~~expressions inas ~~the~~they relate ~~second quarter of 2017, primarily due~~ to ~~expenses~~us ~~related~~or ~~to public~~our ~~company~~management ~~listing~~identify onforward-looking ~~the OTCQB~~statements. ~~Business~~Such ~~and~~statements ~~related~~reflect ~~taxes~~the ~~are~~current ~~levied~~view onof ~~value-added~~our ~~tax~~management with ~~which~~respect isto ~~charged~~future onevents ~~revenue.~~and ~~Such tax~~are ~~expenses~~subject ~~increased~~to byrisks, $7uncertainties,~~516~~ inassumptions ~~the~~and ~~second~~other ~~quarter~~factors ofas ~~2017~~they ~~due~~relate to ~~the~~our ~~increase in~~ industry, our ~~revenue~~operations asand ~~compared~~results toof ~~the~~operations, ~~same~~and ~~period last~~any ~~year.~~businesses Asthat ~~an internet company,~~ we ~~operate~~may onacquire. ~~light~~Should ~~fixed~~one ~~assets~~or ~~requirement~~more ~~and~~of ~~depreciation~~the ~~expense~~events ~~increased~~described ~~by $15,578 as~~in ~~compared~~these torisk ~~the~~factors ~~same~~materialize, ~~period~~or ~~last~~should ~~year~~our ~~because~~underlying ofassumptions ~~fixed~~prove ~~asset additions in 2017~~incorrect, ~~partially~~actual ~~offset~~results bymay ~~full~~differ ~~amortization~~significantly from ofthose ~~some~~anticipated, ~~leasehold improvements~~believed, byestimated, ~~end~~expected, ofintended ~~2016~~or planned.

~~Other~~Although we ~~Income~~believe ~~(Expenses)~~that the expectations reflected in the forward looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable law, including the U.S. federal securities laws, we do not intend to update any of the forward-looking statements to conform them to actual results. The following discussion should be read in conjunction with our pro forma financial statements and the related notes that will be filed herein.

Interest income for the three months ended June 30, 2017 increased to $125,176 from $26,841 for the three months ended June 30, 2016 as a result of short-term borrowings we provided to several SME borrowers in May 2017. We incurred interest expense and bank charges in the amount of $148,793 for the three months ended June 30, 2017, primarily due to interest accrued during the offering period on subscription funds for our convertible notes issuance, which was closed on June 30, 2017. The two short-term entrusted financial management contracts we signed with Shandong Wenye Investment Co., Ltd. expired in the second quarter of 2017 and we recognized realized gain on investments in the amount of $217,041. We did not have such investments for the same period in 2016.Overview

~~Provision~~We are ~~for~~one ~~Income~~of ~~Taxes~~the leading online lending intermediary platforms in PRC. According to information from Wang Dai Zhi Jia (www.wdzj.com)’s ranking report in September 2017, a third-party information platform that specializes in providing information in China’s internet finance industry, we were ranked 34th in China based on the loan volume facilitated through the platform in the month of September 2017.

~~Provision~~We are ~~for~~a ~~income~~holding company that, through our wholly-owned subsidiaries, Benefactum Alliance, Benefactum Sino and Benefactum Shenzhen ~~taxes~~and ~~amounted~~our contractually controlled and managed company, Benefactum Beijing, operates an electronic online financial platform, www.hyjf.com, which is designed to ~~$874~~match investors with SMEs and individual borrowers in China. We believe our services provide an effective financial credit facility solution to under-served SMEs and individual borrowers. In addition,~~377~~ our online financial platform provides investors with attractive returns ranging from 6.5%-12% based on the amount and $0term ~~for~~of different investment. Investors have the option ~~three~~to ~~months~~individually ~~ended~~select ~~June~~specific 30loans to invest in. We also set aside a risk reserve fund with the aim of limiting losses to investors from borrower defaults. In addition, ~~2017~~we ~~and~~provide ~~2016~~investors with access to a liquid secondary market, ~~respectively~~giving them an opportunity to exit their investments before the underlying loans become due.

~~Net~~Due to ~~Income~~PRC legal restrictions on foreign ownership and investment in, among other areas, value-added telecommunications services, which include internet content providers, or ICPs, we, similar to all other entities with foreign-incorporated holding company structures operating in our industry in China, have to operate our internet businesses and other businesses in which foreign investment is restricted or prohibited in the PRC through wholly foreign-owned enterprises, majority-owned entities and variable interest entities. Accordingly, we operate our online financial platform in China through Benefactum Beijing, which was founded in September 2013.

~~Because~~We generate ofrevenue ~~rapid~~from ~~industry growth,~~ our ~~effective~~services ~~sales~~that ~~and~~facilitate ~~marketing~~matching ~~efforts~~investors ~~and~~with ~~promotion~~individual ~~activities,~~and asSME ~~well~~borrowers asthrough ~~increased brand awareness of~~ our online ~~marketplace,~~ ~~we were able to further utilize our established online~~ platform ~~and grow our revenue at a higher pace than operating~~. ~~expenses~~The inCompany’s ~~the~~revenues ~~second~~are ~~quarter~~composed of ~~2017.~~fees ~~For~~collected ~~the~~from ~~three~~services ~~months~~provided ~~ended~~with ~~June~~facilitating ~~30,~~loan ~~2017,~~originations weand ~~recorded net income of approximately $2.89~~services ~~million,~~provided awith ~~27%~~assisting ~~net profit margin, as compared to net loss of approximately $0.41 million~~ in the ~~same~~repayment ~~period~~process ofthrough ~~last~~our ~~year~~online platform.

~~Six~~Loan Origination ~~Months~~Service ~~Ended June 30, 2017 and 2016~~Fee

~~The~~For our ~~following~~services ~~table sets~~that ~~forth~~match investors and borrowers through our online platform, we charge a ~~breakdown~~service offee ~~revenue~~from borrowers for ~~the~~each ~~periods~~effected loan ~~indicated~~facilitated by us, ~~both~~which inis ~~dollar~~accounted ~~amount~~for as revenue, and asimmediately adeducted ~~percentage~~from ofthe ~~total~~proceeds ~~revenues.~~to ~~The~~the ~~information~~borrowers when a ~~should~~loan beis ~~read~~initiated. ~~together~~The ~~with~~service ~~our~~fee ~~unaudited~~is ~~condensed~~1.5%-3.0% ~~consolidated~~of ~~interim~~the ~~financial~~total ~~statements~~amount ~~and~~of ~~related~~each ~~notes~~loan, ~~included~~depending ~~elsewhere in~~on ~~this~~the ~~report~~duration of the loan.

	Six Months Ended June 30,
	2017					2016
	Amount		% of Total			Amount		% of Total
Loan origination service fee	$	11,645,622		62	%	$	8,149,066		72	%
Loan repayment management fee		7,040,123		38	%		3,158,481		28	%
Total	$	18,685,745		100	%	$	11,307,547		100	%

26Loan Repayment Management Fee

~~Revenue~~For our services that assist in repayments of outstanding loans through our online platform, we charge a separate fee from borrowers for each loan repayment facilitated by us, which is accounted for as revenue, and immediately remitted to us when a loan matures and the borrower repays the loan. The loan repayment management fee is based on an agreed upon percentage around 0.3% on the borrowing times the duration of the loan and is collected from the borrower upon repayment of the loan.

~~Our revenues for the six months ended June 30, 2017 and 2016 consists of loan origination service fees~~Key ~~and~~Operating repayment management fees we charge borrowers on the loans facilitated through our online platform. The online Peer-to-Peer lending platform industry has experienced rapid growth in China in recent years, coupled with the increased marketing campaigns, promotion activities on our platform and brand awareness of our online marketplace, our revenue increased from approximately $11.31 million for the six months ended June 30, 2016 to approximately $18.69 million for the six months ended June 30, 2017, reflecting an increase of 65%, of which 73% is attributable to the substantial increase in the volume of loans facilitated through our platform, partially offset by the exchange rate effect of depreciating RMB against USD. Loans facilitated through our platform increased from approximately RMB 2.28 billion in the six months ended June 30, 2016 to approximately RMB 3.75 billion in the same period in 2017, a 65% increase.data

~~Specifically,~~Total number ~~loan~~of ~~origination~~loans ~~service~~facilitated ~~fee~~through ~~increased~~our byonline ~~approximately~~platform ~~$3.50~~increased ~~million~~from 2,818 orin ~~43%,~~2015 to ~~approximately $11.65~~8,739 ~~million~~in ~~for~~2016 ~~the~~and ~~first~~12,668 ~~half of 2017 from approximately $8.15 million~~ for the ~~same~~nine months ~~period~~ended ofSeptember ~~last~~30, ~~year~~2017. ~~Loan~~The ~~repayment~~value ~~management fee~~of ~~increased~~loans byfacilitated ~~approximately~~increased from $3513.880 million, orin ~~123%,~~2015 to ~~approximately~~ $7818.045 million ~~for~~in ~~the first half of 2017 from approximately~~2016 and $3956.166 million for the ~~same~~nine ~~period~~months ofended ~~last~~September ~~year. Loan origination service fee and repayment management fee accounted for 62% and 38% of our revenue for the first half of 2017~~30, ~~respectively, as compared to 72% and 28% in the same period of 2016~~2017. The ~~change is~~number ~~due to the shift in structure~~ of ~~our~~borrowers ~~loan~~increased ~~products~~from ~~towards~~571 ~~longer~~in ~~duration~~2015 ~~loans.~~to ~~Since~~1,067 ~~our loan repayment management fee is~~in ~~based~~2016 onand ~~a certain percentage of the borrowing times duration of a loan~~1,444 ~~the~~in ~~more loans with longer terms,~~ the ~~more~~first ~~loan~~nine ~~repayment management fees we generate. Loans that mature in two~~ months ~~or less accounted for only 25%~~ of ~~total loans for the first half of~~ 2017, ~~as compared to 51% in the same period of 2016, while loans~~ with arepeat ~~term~~borrower ofrates ~~three~~increasing ~~months or more increased~~ from 499% in ~~the first~~2015 ~~half~~to of15% in 2016 toand 7521% in the ~~same~~first ~~period~~nine months of 2017.

~~Operating~~The number ~~Expenses~~of investors decreased 8% from 43,302 in 2015 to 39,999 in 2016 then increased to 53,754 in the first nine months of 2017. The decrease in 2016 was due to a change in our marketing and promotion strategy to attract and retain “better quality” registered investors in terms of stability, activeness and amount of capital available to invest. The decrease was also due to certain measures we took in anticipation of the implementation of the Interim Administration Measures for the Business Activities of Peer-to-Peer Lending Information Intermediaries” (the “Draft Measures”) published by the CBRC, the Ministry of Industry & Information Technology, the Ministry of Public Security and the State Internet Information Office in December 2015. In April 2016 we reduced our in-house sales team and started to acquire investors primarily through third-party referral service providers. The transition from having an in-house sales team to outsourcing the acquisition of investors to third-party referral service providers was a factor in the decrease in investors during 2016. Since the referral service providers were new partners, they did not have full knowledge of our sales and marketing strategies, therefore they could not immediately commence processes to attract new investors, which also negatively impacted the number of investors in 2016. The number of investors significantly increased in the first nine months of 2017 resulted from our continuous efforts in marketing with our referral service providers.

~~Our total operating~~Repeat ~~expenses~~investor rates increased from ~~approximately~~42% ~~$10.15~~in ~~million~~2015 to 56% in 2016 and remained 56% in the first ~~half~~nine months of ~~2016~~2017. Loans outstanding increased from $186.0 million as of December 31, 2015 to ~~approximately~~$246.1 million as of December 31, 2016 and $12443.526 million as of September 30, 2017. In anticipation of the implementation of the Draft Measures, we altered our strategy in 2016 and shifted our business focus toward attracting more small-enterprise borrowers, which required us to gradually decrease the ~~same~~loan ~~period~~amounts facilitated for each loan in order to meet the requirements of ~~2017~~the Draft Measures. This led to the decrease in the average loan amount from $182,039 anin ~~increase~~2015 to $93,658 in 2016 and $75,516 in the first nine months of 232017. The loan origination service fee we charge is 1.5% to 3% of the loan amount, depending on duration of ~~which~~the ~~negative~~loan. 6%The islower ~~due~~average loan amount will lead to ~~exchange~~lower ~~rate~~loan ~~effect~~origination service offee ~~depreciating~~per ~~RMB~~transaction ~~against~~for ~~USD,~~loans with the ~~rest~~same duration. While the average loan duration in first nine months of 2017 did ~~being~~not ~~primarily~~vary ~~attributable~~significantly tofrom 2016 and 2015, the ~~increase~~decrease in ~~sales~~the ~~and~~average ~~marketing~~loan ~~expenses~~amount resulted in lower loan origination service fee per transaction. However, ~~which~~the ~~increased~~aggregate byamount ~~38%~~of ~~from~~service fees earned in the ~~same~~first ~~period~~nine ~~last~~months of 2017 was unaffected since ~~year~~the platform was able to increase the total volume of loans facilitated.

~~The following table sets forth the main components of our operating expenses for the six months ended June 30, 2017 and 2016:~~ 24

	Six Months Ended June 30,
	2017					2016
	Amount		% of Total			Amount		% of Total
Sales & Marketing Expenses	$	9,734,261		77.7	%	$	7,407,457		73.0	%
General & Administrative Expenses		2,647,316		21.1	%		2,634,011		26.0	%
Business & related taxes		65,540		0.5	%		40,546		0.4	%
Depreciation		76,458		0.6	%		65,547		0.6	%
Total Operating Expenses	$	12,523,574		100	%	$	10,147,561		100	%

The main operating metrics we consider are set forth in the table below for the periods indicated:

Our sales and marketing expenses increased by 31% (38% after excluding exchange rate effect) from approximately $7.41 million in the first half of 2016 to approximately $9.73 million in the first half of 2017. The increase was primarily due to the increase in expenses associated with sales and marketing efforts and promotion activities resulting in higher volume of loans facilitated through our platform. Our general and administrative expenses increased slightly by 0.5% (5.3% after excluding exchange rate effect) from approximately $2.63 million in the first half of 2016 to approximately $2.65 million in the first half of 2017, primarily due to expenses related to public company listing on the OTCQB, offset by the layoff of more than 1,000 off-line sales related personnel in April 2016 to comply with new industry regulatory measures, which reduced related general and administrative expenses. Business and related taxes are levied on value-added tax which is charged on revenue. Such tax expenses increased by $24,994 in the first half of 2017 due to the increase in our revenue as compared to the same period last year. As an internet company, we operate on light fixed assets requirement and depreciation expense increased by $10,911 as compared to the same period last year because of fixed asset additions in 2017, partially offset by full amortization of some leasehold improvements by end of 2016.


	Nine Months Ended September 30,			Year Ended December 31,
	2017			2016			2015
Number of borrowers		1,444			1,067			571
Repeat borrower rate		21	%		15	%		9	%

Number of investors		53,754			39,999			43,302
Repeat investor rate		56	%		56	%		42	%

Loan volume
Number of loans		12,688			8,739			2,818
Value of loans (in US$ millions)	$	956.6		$	818.5		$	513.0
Average loan amount	$	75,516		$	93,658		$	182,039

Loans outstanding at end of period (in US$ millions)	$	443.6		$	246.1		$	186.0

27The following tables set forth loan volume facilitated through our online platform by product and guarantor type, including both number and value of loans.

Other Income (Expenses)


	Nine Months Ended September 30,		Year Ended December 31,					Nine Months Ended September 30,		Year Ended December 31,
	2017		2016		2015			2017		2016		2015
Loan volume by product:							Loan volume by guarantor:
Number of loans							Number of loans
Xin Shou Zhuan Qu (1)		366		163		44	Pawn shops		6,959		6,152		1,489
Cai Fu Hui (2)		8,962		5,288		2,266	Financing guarantee companies		476		351		17
Zun Xiang (3)		348		139		—	Asset or investment management companies		2,148		1,143		—
Hui Ji Hua (4)		—		7		—	Micro credit companies		875		837		308
You Xuan Zhai Quan (5)		241		—		—	Others		2,210		256		1,005
Zhai Quan Zhuan Rang (6)		2,751		3,141		503	Total		12,668		8,739		2,818
Hui Xiao Fei (7)		—		1		5	Value of loans (in US$ millions)
Total		12,668		8,739		2,818	Pawn shops	$	648.0	$	572.3	$	323.4
Value of Loans (in US$ millions)							Financing guarantee companies		37.3		46.2		1.9
Xin Shou Zhuan Qu (1)	$	11.6	$	63.4	$	0.3	Asset or investment management companies		56.5		71.8		—
Cai Fu Hui (2)		872.1		734.0		508.6	Micro credit companies		97.2		111.6		100.5
Zun Xiang (3)		18.3		10.6		—	Others		117.6		16.7		87.3
Hui Ji Hua (4)		—		0.2		—	Total	$	956.6	$	818.5	$	513.0
You Xuan Zhai Quan (5)		38.1		—		—
Zhai Quan Zhuan Rang (6)		16.5		10.2		3.7
Hui Xiao Fei (7)		—		0.1		0.3
Total	$	956.6	$	818.5	$	513.0

Interest income for the six months ended June 30, 2017 increased to $156,028 from $59,525 for the six months ended June 30, 2016 as a result of short-term borrowings we provided to several SME borrowers in May 2017. We incurred interest expense and bank charges in the amount of $150,540 for the six months ended June 30, 2017, primarily due to interest accrued during the offering period on subscription funds for our convertible notes issuance, which was closed on June 30, 2017. The two short-term entrusted financial management contracts we signed with Shandong Wenye Investment Co., Ltd. expired in the first half of 2017 and we recognized realized gain on investments in the amount of $217,041. We did not have such investments in the first half of 2016.

	(1)	Xin Shou Zhuan Qu: loan projects exclusive for new investors for them to experience the online registration, fund injection and investing processes.
	(2)	Cai Fu Hui: the blanket name for all loan products which are approved and posted on our platform after their borrowers’ profiles are collected and assessed for credit risk but cannot be classified into any of the other six product types.

~~Provision for Income Taxes~~ 25

Provision for income taxes amounted to $1,516,105 and $121,489 for the six months ended June 30, 2017 and 2016, respectively.

	(3)	Zun Xiang: exclusive service for qualified VIP investors which offers premiere services with higher investment returns.
	(4)	Hui Ji Hua: convenient and efficient automatic investment service that, with the investors’ prior authorizations, offers automatic and diversified investment portfolio.
	(5)	You Xuan Zhai Quan: asset trading products promoted in conjunction with local financial asset exchanges
	(6)	Zhai Quan Zhuan Rang: specially designed service that allows investors to transfer their creditors’ rights on our platform prior to the expiration date of the loans.
	(7)	Hui Xiao Fei: loan products designed jointly with cooperative partners with focus on consumer financing.

~~Net~~Important Factors ~~Income~~Affecting Our Results of Operations

~~Because of rapid industry~~Major ~~growth,~~factors ~~our~~affecting ~~effective sales and marketing efforts and promotion activities, as well as increased brand awareness of~~ our ~~online marketplace,~~results ~~we were able to further utilize our established online platform and grow our revenue at a higher pace than operating expenses in the first half~~ of ~~2017.~~operations ~~For~~include the six months ended June 30, 2017, we recorded net income of approximately $4.89 million, a 26% net profit margin, as compared to net income of approximately $1.05 million in the same period of last year.following:

~~Liquidity~~● ~~and~~Economic ~~Capital~~Conditions ~~Resources~~in China

~~Sources~~The demand for online financing marketplace services from borrowers and investors is dependent upon overall economic conditions in China. General economic factors, including the interest rate environment and unemployment rates, may affect borrowers’ willingness to seek loans and investors’ ability and desire to invest in loans. For example, significant increases in interest rates could cause potential borrowers to defer obtaining loans as they wait for interest rates to become stable or decrease. Additionally, a slowdown in the economy, such as a rise in the unemployment rate and a decrease in real income, may affect individuals’ level of ~~Liquidity~~disposable income. This may negatively affect borrowers’ repayment capability, which in turn may decrease their willingness to seek loans or potentially cause an increase in default rates. If actual or expected default rates increase generally in China or the online financing market, investors may delay or reduce their investments in loan products in general, including on our marketplace.

~~Cash~~● ~~balances~~Ability atto ~~June 30,~~Acquire ~~2017~~Borrowers and ~~December~~Investors 31, 2016 were approximately $21.73 million and $8.56 million, respectively. The cash balance included cash held in private loan risk reserve accounts of approximately $10.01 million and $7.30 million as of June 30, 2017 and December 31, 2016, respectively.Effectively

Our ability ~~principal~~to ~~sources of~~increase ~~liquidity~~the ~~were~~loan ~~cash~~volume ~~generated~~facilitated ~~from~~through ~~operating~~our ~~activities,~~marketplace ~~proceeds~~largely ~~from~~depends ~~the~~on ~~issuance~~our ability to attract potential borrowers and ~~sale~~investors ofthrough ~~our~~sales ~~common~~and ~~shares~~marketing inefforts. ~~private placements~~Our ~~closed~~sales onand ~~October~~marketing 18efforts include those related to borrower and investor acquisition and retention, ~~2016~~and general marketing. We intend to continue to dedicate significant resources to our sales and marketing efforts and constantly seek to improve the ~~issuance~~effectiveness of ~~convertible~~these ~~notes~~efforts, ~~closed~~in onparticular ~~June~~with ~~30,~~regard ~~2017~~to borrower and investor acquisition.

~~The~~We primarily ~~following~~attract ~~table~~borrowers through our own platform and referrals from third party guarantors, although the general public may ~~sets~~also ~~forth~~access our platform and submit a ~~summary~~borrower profile online. We also acquire borrowers through referrals from financial institutions we partner with. As of ~~our~~June ~~cash~~30, ~~flows~~2017, ~~for~~we have entered into cooperation agreements with four pawn shops, three guaranty companies, a micro loan companies, an asset management company, an information technology company, an investment consulting company, a technology company, an investment management company, a financial services company, and technology development companies. Other than online investors, we attract investors through cooperative relationships with institutions. To obtain investors more efficiently, Benefactum Beijing has entered into co-operative agreements with several third-party referral service providers, pursuant to which those service providers will refer potential investors to Benefactum Beijing while Benefactum Beijing will pay those service providers service fees based on the ~~periods~~value ~~indicated:~~ of loans those referred investors actually lend through Benefactum Beijing.

	Six Months Ended June 30,
Summary of Consolidated Cash Flow Data:	2017			2016
Net cash provided by operating activities	$	3,000,320		$	1,245,600
Net cash used in investing activities		(404,340	)		(117,438	)
Net cash provided by financing activities		10,177,986			—
Effect of exchange rate change		395,609			(131,891	)
Cash and cash equivalents:
Net increase		13,169,575			996,271
Balance at beginning of period		8,561,695			5,712,741
Balance at end of period	$	21,731,270		$	6,709,012

Although we do not provide incentives to borrowers to apply to the platform, as part of our strategy to attract investors, we offer investment principal coupons and interest premium coupons to investors during promotions. Investment principal coupon has a face value usually under RMB 300 each, which may be combined for use not to exceed RMB 1,000 by an investor at any given time and which can be used at the time of investment to be added to the investment principal, thereby reducing the cash contribution made by the investor. Interest premium coupon, with face value of 0.5%, 1%, 1.5% or 2% each, not to be used in combination, can be applied at the time of investment to “boost” the interest rate the investor will receive. Our platform pays the added investment principals and interests to investors for using investment principal coupons when investors receive their investment principal back and when they receive interest payments, respectively; our platform also pays the added interests to investors for using interest premium coupons.

During the six months ended June 30, 2017, net cash provided by operating activities totaled approximately $3.0 million, which was primarily due to net income of approximately $4.89 million, increases in payables and accruals of approximately $4.21 million, of which $2.56 million was the result of an increase in the balance of risk reserve fund and $1.06 million was due to the increase in taxes payable, mainly income tax, and decrease in prepayment balance of approximately $1.21 million, mainly prepaid service fee to referral service providers, partially offset by increase in accounts receivable of approximately $0.07 million from China PnR, our third-party online payment service provider, and increase in short-term loans receivable of approximately $7.27 million. On June 30, 2017, we entered into a series of entrusted loan contracts, pursuant to which the Company, as the trustor and provider of the funds, entrusted a trustee to grant entrusted loans in the aggregate principal amount of ~~approximately $7.27 million (RMB 50 million) to several SME borrowers. The loans are short-term loans between three and six months with interest payable on a monthly basis.~~26

28● Effectiveness of Risk Management

~~Net cash used in investing~~We ~~activities~~manage ~~totaled~~credit ~~approximately~~risk ~~$0.40~~on ~~million~~behalf ~~for the six months ended June 30, 2017. During the first half~~ of 2017, we paid approximately $0.25 million for fixed assets acquisition and $7.27 million for purchase of short-term principal-guaranteed wealth management product offered by Jiangxi Bank. Pursuant to a share transfer framework agreement signed with certain shareholders of Shenzhen TouZhiJia Financial Information Service Co., Ltd. (“TouZhiJia”) in June 2017, the ~~Company~~investors ~~made~~primarily ~~a 50% deposit of approximately $1.39 million~~ in ~~cash for acquiring a 4.45% equity interest in TouZhiJia. Balance of~~ the ~~purchase~~following price is payable upon closing of the transaction. Upon expiration of the two short-term entrusted financial management contracts signed with Shandong Wenye Investment Co., Ltd. (“Wenye”), Wenye returned to the Company the entrusted principals with realized gain on investments in the aggregate amount of approximately $8.51 million in the second quarter of 2017.ways:

~~Net cash provided by~~Our ~~financing~~ability ~~activities totaled approximately $10.18 million during the six months ended June 30, 2017. On June 30, 2017, we entered into a securities purchase agreement with various investors, pursuant~~ to ~~which~~effectively wesegment ~~issued~~borrowers ~~and sold senior convertible promissory notes in the aggregate principal amount of $13,189,163.87 (RMB 90,357,316.73) (the “Notes”), convertible~~ into ~~shares of~~appropriate ~~the~~risk ~~Company’s~~profiles ~~Common~~affects ~~Stock~~our ~~following~~ability June 30, 2018 at a conversion price of $2.00 per share (the “Conversion Price”) in a private placement. The Notes mature on June 30, 2020 and accrue interest at a rate of 6%, 7% and 8% per annum for each of the first, second and third year, respectively, with such interest payable annually. In event of a conversion of the Notes, the investors have agreed to aoffer ~~one~~attractive ~~year~~pricing ~~lock-up period with respect~~ to ~~the shares of Common Stock issuable upon conversion of the Notes~~borrowers ~~commencing~~as onwell ~~the~~as ~~applicable~~our ~~conversion~~ability ~~date of the Notes. The Notes are secured by a pledge of shares of the Common Stock pursuant~~ to aoffer ~~stock~~investors ~~pledge~~attractive ~~agreement (the “Stock Pledge Agreement”) between Avis Genesis Inc.~~returns, aboth ~~majority shareholder~~ of ~~the Company,~~which ~~and~~directly ~~the~~relate ~~investors on the basis of one share of Common Stock per $1 loaned under the Note. Other than the shares pledged pursuant~~ to the ~~Stock~~level ~~Pledge Agreement, there is no recourse against the Company upon a default~~ of ~~the~~user ~~Notes.~~confidence ~~As of the closing day on June 30, 2017, we have received cash proceeds~~ in ~~the amount of approximately $10.18 million from issuance of the Notes,~~ ~~with~~our ~~the remaining amount in an escrow account maintained by Shandong Keyu Law Firm~~marketplace.

~~The~~● ~~resulting~~We ~~change in~~evaluate ~~cash~~the ~~for~~borrower’s ~~the~~repayment ~~six~~ability ~~months~~via ~~ended~~our ~~June~~pre-transaction ~~30,~~credit ~~2017~~assessment ~~was~~and afraud ~~net~~detection ~~increase~~using ofour ~~approximately~~big ~~$13.17~~data ~~million~~credit assessment system. Potential borrowers who do not meet our credit assessment grade are denied;

~~During~~● ~~the~~We ~~six~~offer months ended June 30, 2016, net cash provided by operating activities totaled approximately $1.25 million. Net cash used in investing activities totaled approximately $0.12 million. No cash was provided by financing activities during this period. The resulting change in cash for this period was a ~~net~~risk ~~increase~~reserve offund ~~approximately $1.0 million,~~ which ~~was~~is ~~primarily~~2-5% ~~due to net income~~ of ~~approximately $1.05 million,~~ the ~~increase~~credit inextended ~~payables~~to ~~and~~the accruals of approximately $1.32 million, and depreciation expense of approximately $0.07 million, partially offset by increases in receivables and prepayment of approximately $1.19 million, and payment of approximately $0.12 million for fixed assets acquisition. borrowers;

As● ofEach ~~June~~loan ~~30,~~transaction ~~2017, we~~facilitated ~~had~~on ~~approximately~~our ~~$42.98~~platform ~~million~~is inguaranteed ~~total~~by ~~current~~a ~~assets~~third party guarantor who is jointly and ~~$13.68~~severally ~~million~~liable for the loan, in ~~total~~certain ~~current~~instances ~~liabilities,~~the ~~with~~third aparty ~~current~~guarantor ~~ratio of~~may ~~3.14.~~require Asthe ofborrower ~~December~~to ~~31,~~collateralize ~~2016~~the guaranty, however we ~~had~~do ~~approximately~~not ~~$19.99~~require ~~million~~borrowers into ~~total~~provide ~~current~~collateral ~~assets~~directly ~~and~~to ~~$9.05~~investors ~~million~~as insecurity ~~total~~for ~~current liabilities~~the loans; ● We prohibit borrowers from having more than one loan outstanding at a time, ~~representing~~and require the borrower to undergo a ~~current~~subsequent ~~ratio~~review ofprior ~~2.21.~~to facilitating any future new loans; and

~~Off-Balance~~● ~~Sheet~~Additionally, ~~Arrangements~~after the debt financing is provided to the borrower, the guarantor will monitor the borrower’s performance and will provide the platform with the feedback on the borrower’s credit condition, contract performance and debt repayment capabilities. In the event of any material development resulting in a negative turn in a borrower’s financial standing and potential ability to repay its loan, our management will determine the proper action to take to avert or minimize the risk of non-payment.

We● ~~have~~Ability noto ~~off-balance sheet arrangements, including arrangements that would affect our liquidity, capital resources, market risk support and credit risk support or other benefits.~~Innovate

~~Critical~~Our growth ~~Accounting~~to ~~Policies~~date has in part depended on, and our future success will depend on, successfully meeting borrower and investor demand with new and innovative loan and investment products. We have made and intend to continue to make efforts to develop loan and investment products for borrowers and investors. We regularly evaluate the popularity of our existing product offerings and develop new products and services that cater to the ever evolving needs of our borrowers and investors. Over time we will continue to expand our offerings by introducing new products. From the borrower perspective, we will continue to develop tailored credit products to meet the specific needs of our target borrowers. We plan to expand our ability to implement risk-based pricing by developing more pricing grades to optimize loans based on a borrower’s credit criteria, enabling us to facilitate customized loans tailored to borrowers’ specific credit profiles.

~~Basis~~● ofRegulatory ~~presentation~~Environment ~~and~~in ~~principles of consolidation~~China

The ~~accompanying unaudited~~ ~~condensed~~regulatory ~~consolidated~~environment ~~financial~~for ~~statements~~the ~~have~~peer-to-peer ~~been~~lending ~~prepared~~service inindustry ~~accordance with accounting principles generally accepted~~ in ~~the United~~China ~~States~~is ~~(“U.S.~~developing ~~GAAP”~~and ~~or the “Standard”). In the opinion of management~~evolving, ~~all~~creating ~~adjustments~~both ~~(consisting~~challenges ~~only~~and ofopportunities ~~normal~~that ~~recurring~~could ~~adjustments)~~affect ~~necessary~~our ~~for the fair presentation of the~~ financial ~~information for the interim periods reported have been made~~performance. ~~Interim~~Due ~~results~~to ~~are~~the ~~not~~relatively ~~necessarily~~short ~~indicative~~history of ~~results~~the ofpeer-to-peer ~~a full year. These unaudited condensed consolidated~~lending ~~financial~~service ~~statements~~industry ~~should be read~~ in ~~conjunction~~China, ~~with~~ the ~~audited~~PRC ~~consolidated~~government ~~financial~~is ~~statements and related notes included~~ in ~~our annual report on Form 10-K for~~ the ~~fiscal~~process ~~year~~of ~~ended~~building ~~December~~a ~~31,~~regulatory ~~2016,~~framework ~~filed~~governing ~~with~~our ~~the Securities and Exchange Commission on April 13, 2017~~industry.

29We will continue to make efforts to ensure that we are compliant with the existing laws, regulations and governmental policies relating to our industry and to comply with new laws and regulations or changes under existing laws and regulations that may arise in the future. While new laws and regulations or changes to existing laws and regulations could make loans more difficult to be accepted by investors or borrowers on terms favorable to us, or at all, these events could also provide new product and market opportunities. For more details, please see “Regulations - Regulations on Value-Added Telecommunication Services” and “Regulations on Peer-to-Peer Lending Service Provider”.

The unaudited condensed consolidated financial statements include the accounts of Sino Fortune, Benefactum Alliance, including its wholly owned subsidiaries Benefactum Sino and WFOE, and its variable interest entity Benefactum Beijing. All inter-company balances and transactions have been eliminated in consolidation. 27

~~Use of Estimates~~Recent Developments

~~Preparation~~In March of2017, ~~the consolidated~~we ~~financial~~engaged ~~statements~~Jiangxi inBank ~~conformity~~to ~~with~~provide ~~U.S.~~fund ~~GAAP~~depository ~~requires~~services ~~management~~for toour ~~make~~marketplace, ~~estimates~~pursuant ~~and~~to ~~assumptions~~which ~~that~~Jiangxi ~~affect~~Bank will ~~the~~set ~~reported~~up ~~amount~~separate ofaccounts ~~assets~~for borrowers and ~~liabilities~~investors, and ~~disclosure~~assume offund ~~contingent~~depository ~~assets~~functions ~~and~~including ~~liabilities~~settlement, ataccounting ~~the~~and safeguarding ~~date~~online oflending ~~the~~capital. ~~consolidated financial~~Third-party ~~statements~~payment asagents ~~well~~operate as the ~~reported~~payment ~~amounts~~channels ~~of revenues~~ and ~~expenses~~only ~~during~~transfer ~~the~~funds ~~reporting~~to ~~period. Significant estimates~~and ~~required~~from tofund bedepository ~~made~~accounts. byRelevant ~~management~~Chinese ~~include,~~regulations ~~but~~require ~~are~~us ~~not limited~~ to, ~~useful~~enter ~~lives~~into ofa ~~property,~~fund ~~plant~~depository ~~and~~agreement ~~equipment,~~with ~~intangible~~only ~~assets,~~one ~~the~~commercial ~~recoverability~~bank ofto ~~long-lived~~provide ~~assets,~~fund ~~allowance~~depository ~~for~~services. ~~doubtful~~For ~~accounts~~more details, ~~deferred~~see ~~revenues~~“Regulations ~~and~~on ~~deferred~~Peer-to-Peer ~~income~~Lending ~~tax. Actual results~~Service ~~could differ from those estimates~~Provider.”

~~Cash~~On June 20, 2017 the Board of Directors approved a reverse stock split of the Company’s issued and ~~Cash~~outstanding ~~Equivalents~~shares of common stock, par value $0.001 per share (the “Common Stock”), at a ratio of 1-for-5 (the “Reverse Stock Split”). The Reverse Stock Split was effective on June 20, 2017 (the “Effective Date”). On August 7, 2017, the Reverse Stock Split was reflected on the OTCQB. As a result of the Reverse Stock Split, every five issued and outstanding shares of the Company’s Common Stock have been automatically combined into one issued and outstanding share. This reduced the total number of issued and outstanding shares of Common Stock from 361,820,246 to approximately 72.4 million, and the Company’s authorized shares of Common Stock also have been reduced from 2,990,000,000 to 598,000,000. No fractional shares were issued. All fractional shares created by the Reverse Stock Split were rounded up to the nearest whole share.

~~Cash~~On June 30, 2017, the Company entered into a securities purchase agreement (the “Purchase Agreement”) with certain investors (the “Investors”), pursuant to which we issued and ~~cash~~sold ~~equivalents~~senior convertible promissory notes in the aggregate principal ~~include~~amount ~~cash~~of $13,189,164 (RMB 90,357,317) (the “Notes”), convertible into shares of the Company’s common stock (the “Common Stock”) following June 30, 2018 at a conversion price of $2.00 per share (the “Conversion Price”) in a private placement (the “Private Placement”). The Notes mature on ~~hand~~June 30, 2020 and ~~highly~~accrue ~~liquid~~interest ~~investments~~at a rate of 6%, 7% and 8% per annum for each of the first, second and third year, respectively, with ~~maturities~~such interest payable annually. In event of ~~three~~a ~~months~~conversion orof ~~less~~the ~~when~~Notes, ~~purchased~~the Investors have agreed to a one year lock-up period with respect to the shares of Common Stock issuable upon conversion of the Notes commencing on the applicable conversion date of the Notes. The ~~Company~~Notes ~~has~~are nosecured ~~cash~~by ~~equivalents~~a aspledge of ~~June~~shares 30of the Common Stock pursuant to a stock pledge agreement (the “Stock Pledge Agreement”) between Avis Genesis Inc., ~~2017~~a majority shareholder of the Company, and ~~December~~the 31Note investors on the basis of one share of Common Stock per $1 loaned under the Note, ~~2016~~for an aggregate of 13,189,450 ~~respectively~~shares. Other than the shares pledged pursuant to the Stock Pledge Agreement, there is no recourse against the Company upon a default of the Notes.

~~Investments~~In the end of June 2017, the Company started to lend entrusted loans through Qingdao Weichuang, a licensed loan provider under the PRC regulations, to SME and individual borrowers in China. The loans are short-term loans with typical loan terms between three and six months, and interest payable on a monthly basis. In connection with the entrusted loan contracts, Benefactum Beijing also entered into entrusted loan guarantee contracts with guarantors, pursuant to which the guarantors have agreed to guarantee the obligations under the entrusted loan contracts. Benefactum Beijing pays a processing fee equal to 0.15% of the aggregate loan amounts to Qingdao Weichuang for issuing the entrusted loans. The sister of Mr. Bodang Liu, our chief executive officer and chairman, owns 48.41% of the outstanding equity interests in Qingdao Weichuang.

~~Investments other than~~On ~~highly~~September ~~liquid~~1, ~~ones~~2017, ~~are~~the ~~classified~~Company ~~and~~acquired ~~accounted~~4.4538% ~~for~~of asequity ~~available-for-sale.~~interests ~~Management~~in ~~determines~~Shenzhen ~~the~~TouZhiJia ~~appropriate~~Financial ~~classification of~~Information ~~its~~Service ~~investments~~Co., atLtd. (“Shenzhen ~~the~~TouZhiJia ~~time~~Financial”) offrom ~~purchase~~three ~~and~~individuals ~~reevaluates~~with ~~the~~a ~~classifications~~total atcash ~~each~~consideration ~~balance~~of ~~sheet~~$2,870,067 ~~date~~(RMB 19.1 million). The ~~Company~~equity ~~classifies its~~interest ~~investments~~the asCompany ~~either~~acquired ~~short-term~~was orheld ~~long-term~~through ~~based~~three onlimited partnerships wherein each ~~instrument~~partnership’s ~~underlying~~sole ~~contractual~~purpose is ~~maturity~~to ~~date,~~hold the ~~nature of~~equity ~~the~~interest ~~investment~~of ~~and~~Shenzhen ~~its~~TouZhiJia ~~availability~~Financial. ~~for~~Due ~~use~~to inthe ~~current~~fact ~~operations.~~that ~~The~~the ~~Company’s~~only ~~investments~~asset ~~are~~in ~~carried~~these atlimited ~~fair value,~~partnerships ~~with~~are ~~unrealized~~their ~~gains~~equity ~~and~~investments ~~losses,~~in ~~net~~Shenzhen ofTouZhiJia ~~taxes~~Financial, ~~reported~~the asCompany abelieves ~~component~~that ofthe ~~accumulated~~acquisition ~~other~~of ~~comprehensive~~the ~~income~~equity ~~in shareholders’~~interest ~~equity,~~of ~~with~~these ~~the~~limited ~~exception~~partnership ofconstitute ~~unrealized~~as ~~losses~~an ~~believed~~acquisition toof bean ~~other-than-temporary,~~asset ~~which~~rather ~~are~~than ~~reported~~an inacquisition ~~earnings~~of ina ~~the current period~~business. ~~When~~The weCompany ~~sell~~doesn’t have ansignificant ~~investment,~~influence ~~the~~nor ~~cost~~control isover ~~based~~Shenzhen onTouZhiJia ~~the specific identification method~~Financial.

~~Revenue~~On September ~~Recognition~~27 and September 29, 2017, we filed Articles of Merger and a Certificate of Correction, respectively, with the Secretary of State of Nevada to effect a change in our corporate name from “Sino Fortune Holding Corporation” to “Hui Ying Financial Holdings Corporation”. The name change was the result of a merger of our wholly-owned subsidiary, “Hui Ying Financial Holdings Corporation”, with and into us to effect the name change. We are currently in the process of requesting FINRA approval of the name change. As a result, our new corporate name has not yet been reflected on the OTCQB.

~~The Company recognizes~~Changes ~~revenues~~in ~~under~~Financial ASC 605 when the following four revenue recognition criteria are met for each revenue type: (i) persuasive evidence of an arrangement exists, (ii) delivery has occurred or services have been rendered, (iii) the selling price is fixed or determinable, and (iv) collectability is reasonably assured.Position

~~Loan facilitation service~~The isfollowing ~~rendered~~table ~~when~~sets aforth ~~loan~~selected isinformation ~~successfully~~from ~~matched~~our ~~between~~consolidated ~~the~~balance ~~lenders~~sheet ~~and~~as ~~the borrowers; and when a loan is originated. The origination~~ of aSeptember ~~loan~~30, ~~takes~~2017 ~~place when the funds provided by the investor are transferred to the borrower. Revenue is recognized when loan facilitation service is rendered~~ and ~~fee~~December ~~is collected from borrower upon the closing of the loan~~31, 2016. ~~The~~This ~~aforementioned~~information ~~fee~~should isbe ~~an agreed~~read ~~upon~~in ~~percentage~~conjunction ofwith ~~the~~our ~~total~~consolidated ~~principal~~financial ~~which~~statements ~~varies~~and ~~based~~related onnotes ~~the~~included ~~terms of the loan. The borrower has to agree upfront to~~elsewhere ~~such~~in ~~service~~this ~~fee and such service fee is not refundable~~prospectus.

Towards the end of each loan term, the Company also provide repayment service to ensure loan repayment process is handled smoothly through our online platform and to assist in release of liens or collaterals if applicable. The Company charges a separate fee for loan repayment service. Loan repayment service is rendered when a loan matures and borrower repays the principal and interest through our online platform. Revenue is recognized when repayment service is rendered and collection of service fee from borrowers is assured. Our repayment service fee is based on an agreed upon percentage on the borrowing times the duration of a loan and is not refundable.

	As of September 30,		As of December 31,
	2017		2016
	(Unaudited )

Selected Consolidated Balance Sheets Data
Assets:
Cash and cash equivalents	$	12,942,309	$	8,561,695
Short-term investments		—		8,274,306
Short-term loans receivable		35,312,326		—
Prepayments		587,237		2,078,926
Total assets		50,494,162		19,988,814
Liabilities
Liabilities from risk reserve fund guarantee, without recourse to the Company		13,101,290		7,297,123
Convertible notes payable		13,189,164		—
Accounts payable and accrued liabilities		470,282		227,895
Taxes payable		4,002,070		1,285,160
Total liabilities		32,231,831		9,046,762

30Cash and Cash Equivalents

~~Property~~As of September 30, 2017, our cash and ~~Equipment~~cash equivalents balance was approximately $12.9 million, representing an increase of $4.4 million from approximately $8.56 million as of December 31, 2016. During the nine months ended September 30, 2017, we received cash proceeds in the amount of approximately $13.3 million from the issuance of convertible notes, and net cash provided by operating activities amounted to approximately $20.2 million, which was partially offset by negative cash flows from investing activities of approximately $29.6 million. The rest of the increase in the cash balance is attributable to the exchange rate change of approximately $0.5 million.

~~Property and equipment are recorded at cost. Depreciation is computed using the straight~~Short-~~line method, over the estimated useful lives of these assets.~~term ~~Estimated useful lives of the assets are as follows:~~Investments

Office furniture	3 years
Electronic equipment	5 years
Automobile	5 years
Leasehold improvement	1 to 3 years

Short-term investments consist of principal-guaranteed investments placed with investment management companies and wealth management products offered by commercial banks, with maturities within six months. Balance of short-term investments as of December 31, 2016 was $8,274,306, consisting of the six-month wealth management products purchased with Shandong Wenye Investment Co., Ltd., which expired in the second quarter of 2017 and fully collected by the Company.

~~Maintenance and repairs~~Short-term ~~are~~Loans ~~charged directly to expenses as incurred. Major additions and betterment to property and equipment are capitalized and depreciated over the remaining useful life of the assets.~~Receivable

~~Earnings~~In June ~~Per~~2017, ~~Share~~the Company launched entrusted loan service through a licensed loan provider to small and medium-sized enterprises (“~~EPS~~SME”) and individual borrowers in China. As of September 30, 2017, all the entrusted loans issued were short-term with maturities within six months and the balance of loans receivable amounted to $35,312,326. We did not have such service for the years ended December 31, 2016.

~~Reclassification~~Prepayments

~~Certain reclassifications have been made~~The tofollowing ~~the~~is ~~2016~~a ~~unaudited~~summary ~~condensed~~of ~~consolidated~~prepayments ~~financial~~as ~~statements~~of toSeptember ~~confirm~~30, ~~to the~~ 2017 ~~unaudited~~and ~~condensed~~December ~~consolidation~~31, ~~financial statement presentation. These reclassifications had no effect on net income or cash flows as previously reported.~~2016:

Recent Accounting Pronouncements

	September 30,		December 31,
	2017		2016
Prepaid service fees	$	503,198	$	2,071,013
Prepayment for rent		57,163		—
Prepayment for advertising		26,876		—
Down payment for fixed asset		—		7,200
Others		—		713
Prepayments	$	587,237	$	2,078,926

~~In February 2016, the~~As ~~FASB~~of ~~issued~~September ~~ASU 2016-02~~30, ~~“Leases (Topic 842)”~~2017, ~~which supersedes~~ the ~~existing~~prepayment ~~guidance for lease accounting, Leases (Topic 840). ASU 2016-02 requires lessees to recognize leases on their~~ balance ~~sheets,~~decreased ~~and~~by ~~leaves lessor accounting largely unchanged~~$1.5 ~~The~~million ~~amendments~~from ~~in this ASU are effective for fiscal years beginning after~~ December 1531, ~~2018 and interim periods within those fiscal years. Early application is permitted for all entities. ASU~~ 2016~~-02 requires a modified retrospective approach for all leases existing at~~, orwhich ~~entered~~was ~~into~~mainly ~~after,~~due ~~the date of initial application, with an option~~ to ~~elect~~a ~~to use certain transition~~reduction ~~relief.~~in ~~The~~our ~~Company~~prepaid isservice ~~currently~~fees ~~evaluating~~to ~~the~~our ~~impact~~service ~~of this new standard on its consolidated financial statements~~providers.

~~In March 2016, the~~Liabilities ~~FASB~~from ~~issued~~risk ~~ASU~~reserve ~~2016-09,~~fund ~~“Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting”~~guarantee, ~~which~~without ~~simplifies~~recourse several aspects of the accounting for share-based payment transactions, including the recognition of excess tax benefits and deficiencies, the classification of those excess tax benefits on the statement of cash flows, an accounting policy election for forfeitures, the amount an employer can withhold to ~~cover income taxes and still qualify for equity classification and~~ the classification of those taxes paid on the statement of cash flows. ASU 2016-09 is effective for annual and interim periods beginning after December 15, 2016 with early adoption permitted. The guidance will be applied either prospectively, retrospectively or using a modified retrospective transition method, depending on the area covered in this update. The Company ~~adopted this guidance during the three months ended March 31, 2017 and the adoption had no impact on the Company’s consolidated financial statements.~~

InTo minimize ~~April~~default ~~2016~~risk, ~~the FASB~~we ~~issued~~offer ~~ASU~~a ~~No.~~private ~~2016-10,~~loan ~~“Revenue~~risk ~~from~~reserve ~~Contracts~~fund ~~with~~which ~~Customers~~is ~~(Topic~~2-5% ~~606):~~of ~~Identifying~~the ~~Performance~~credit ~~Obligations~~extended ~~and Licensing”.~~to ~~The~~the ~~amendments~~third-party ~~clarify~~guarantors or ~~the~~borrowers ~~following~~who ~~two~~do ~~aspects~~not ofhave ~~Topic~~a ~~606:~~guarantor, (though a) ~~identifying~~risk ~~performance~~reserve ~~obligations;~~fund ~~and (b)~~is ~~the~~not ~~licensing~~a ~~implementation~~regulatory ~~guidance~~requirement. ~~The~~Prior ~~amendments~~to doan ~~not~~application for ~~change~~credit ~~the~~being ~~core~~made ~~principle~~on ofour ~~the~~platform, ~~guidance~~borrower in(or ~~Topic~~if ~~606.~~a ~~The~~guarantor ~~effective date~~is ~~and~~needed ~~transition requirements~~ for the ~~amendments~~borrower, ~~are~~ the ~~same~~guarantor) asis ~~the~~required ~~effective~~to ~~date~~provide an ~~and~~amount ~~transition~~equal ~~requirements~~to in2-5% ~~Topic~~of ~~606. Public~~the ~~entities~~amount ~~should~~being ~~apply~~loaned, ~~the~~which ~~amendments~~shall ~~for~~be ~~annual~~deposited ~~reporting~~directly ~~periods~~into ~~beginning~~the ~~after~~risk ~~December~~reserve ~~15,~~account ~~2017,~~and ~~including~~will ~~interim reporting~~be ~~periods~~refunded ~~therein~~to the borrowers (~~i.e.,~~or ~~January~~guarantors) 1,if ~~2018,~~the ~~for~~loan ais ~~calendar~~paid ~~year~~in ~~entity).~~full ~~Early~~at ~~application~~maturity. ~~for~~Balance ~~public~~of ~~entities~~the isrisk ~~permitted~~reserve ~~only~~fund asincreased ofby ~~annual~~79.5% ~~reporting~~from ~~periods~~$7,297,123 ~~beginning~~as ~~after~~of December 1531, 2016, ~~including~~to ~~interim~~$13,101,290 ~~reporting~~as ~~periods~~of ~~within~~September ~~that~~30, ~~reporting~~2017, ~~period. The~~primarily ~~Company~~due isto ~~currently evaluating~~ the ~~impact~~significant growth of ~~this~~loans ~~new~~facilitated ~~standard~~through onour ~~its~~online ~~consolidated financial statements~~platform.

31Convertible Notes Payable

InOn June ~~May~~30, ~~2016~~2017, the ~~FASB issued~~Company ~~ASU~~entered ~~2016-12,~~into ~~“Revenue~~a ~~from~~securities ~~Contracts~~purchase agreement (the “Purchase Agreement”) with ~~Customers~~certain investors (~~Topic~~the ~~606~~“Investors”):, ~~Narrow-Scope~~pursuant ~~Improvements~~to which we issued and ~~Practical~~sold ~~Expedients~~senior convertible promissory notes in the aggregate principal amount of $13,189,164 (RMB 90,357,317) (the “Notes”), convertible into shares of the Company’s common stock ~~which~~(the ~~provides~~“Common ~~clarifying~~Stock”) ~~guidance~~following ~~and~~June ~~adds~~30, ~~some~~2018 ~~practical~~at ~~expedients~~a conversion price of $2.00 per share (the “Conversion Price”) in a private placement (the ~~areas~~“Private ofPlacement”). ~~assessing~~The ~~collectability~~Notes mature on June 30, ~~presentation~~2020 ofand accrue interest at a rate ~~sales~~of ~~taxes~~6%, ~~received~~7% ~~from~~and ~~customers~~8% per annum for each of the first, ~~noncash~~second ~~consideration~~and third year, ~~contract~~respectively, ~~modification~~with ~~and~~such ~~clarification~~interest payable annually. In event of ~~using~~a conversion of the ~~full~~Notes, ~~retrospective approach~~the Investors have agreed to ~~adopt~~a ~~ASU~~one ~~2014~~year lock-~~09.~~up ~~The~~period ~~Company~~with isrespect ~~currently~~to ~~evaluating~~ the ~~impact~~shares of ~~this~~Common Stock ~~new~~issuable ~~standard~~upon conversion of the Notes commencing on ~~its~~the ~~consolidated~~applicable ~~financial~~conversion date of the Notes. Among other terms, the ~~statements~~Notes contain various events of default provisions which if breached, may result in the acceleration of all obligations under the Notes.

~~In August 2016, the~~Accounts ~~FASB~~payable ~~issued ASU 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts~~ and ~~Cash~~accrued ~~Payments (a~~liabilities consensus of the Emerging Issues Task Force)”, which addresses the following eight specific cash flow issues with the objective of reducing the existing diversity in practice: (1) debt prepayment or debt extinguishment costs; (2) settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing; (3) contingent consideration payments made after a business combination; (4) proceeds from the settlement of insurance claims; (5) proceeds from the settlement of corporate-owned life insurance policies, including bank-owned; (6) life insurance policies; (7) distributions received from equity method investees; (8) beneficial interests in securitization transactions; and (9) separately identifiable cash flows and application of the predominance principle. ASU 2016-15 is effective for annual and interim periods beginning after December 15, 2017 with early adoption permitted. The guidance is to be applied using a retrospective transition method to each period presented. We are currently evaluating the impact of this new standard on our consolidated financial statements.

~~In October 2016, the~~The ~~FASB~~accounts ~~issued~~payable ASU No. 2016-17, “Consolidation (Topic 810): Interests held through related parties that are under common control”, which requires the reporting entity, in determining if satisfying the second characteristic of a primary beneficiary, to include all of its direct variable interests in a VIE and, onaccrued aliabilities ~~proportionate~~increased ~~basis,~~by ~~its~~$0.2 ~~indirect~~million ~~variable~~from ~~interests in a VIE held through related parties, including related parties that are under common control with the reporting entity~~$0.2 ~~The~~million ~~amendments are~~as ~~effective~~of ~~for public business entities for fiscal years beginning after~~ December ~~15,~~31 2016, ~~including~~to ~~interim~~$0.5 ~~periods~~million ~~within~~as ~~those~~of ~~fiscal~~September ~~years. Early adoption is permitted~~30, ~~including adoption in an interim period~~2017. The ~~Company~~increase ~~adopted~~was ~~this~~primarily ~~guidance~~due ~~during the~~to ~~three~~increasing ~~months~~service ~~ended~~fee ~~March~~payable ~~31,~~to ~~2017~~our ~~and~~referral ~~the~~service ~~adoption~~providers ~~had~~as noof September ~~impact~~30, ~~on the Company’s consolidated financial statements~~2017.

~~In November 2016, the~~Taxes ~~FASB~~payable issued ASU No. 2016-18, “Statement of Cash Flows (Topic 230): Restricted Cash”, which addresses diversity in practice that exists in the classification and presentation of restricted cash on the statement of cash flows. The amendment is effective for public companies for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. Management does not believe the adoption of this ASU would have a material effect on the Company’s consolidated financial statements.

InThe taxes ~~January~~payable ~~2017,~~balance ~~the FASB~~increased ~~issued~~by ~~ASU No~~$2.7 ~~2017-04~~million ~~“Intangibles~~from -$1.3 ~~Goodwill~~million ~~and~~as ~~Other~~of ~~(Topic~~December ~~350):~~31 ~~Simplifying~~2016 ~~the~~to ~~Test for Goodwill Impairment~~$4.~~” ASU~~0 ~~2017-04~~million ~~eliminates~~as ~~step two~~ of ~~the~~September ~~goodwill~~30, ~~impairment~~2017. The ~~test~~higher ~~and~~taxes ~~specifies~~payable ~~that~~balance ~~goodwill~~as ~~impairment should be measured by comparing the fair value~~ of aSeptember ~~reporting~~30, ~~unit~~2017 ~~with~~was ~~its~~primarily ~~carrying~~due ~~amount.~~to ~~Additionally,~~ the ~~amount~~fact ofthe ~~goodwill~~income ~~allocated~~tax topayable ~~each~~balance ~~reporting unit~~increased ~~with~~from a$1 ~~zero~~million oras ~~negative carrying amount~~ of ~~net~~December ~~assets~~31, ~~should~~2016 beto ~~disclosed~~$3.6 ~~ASU~~million ~~2017-04~~as isof ~~effective~~September ~~for~~30, ~~annual~~2017, orwhich ~~interim~~was ~~goodwill impairment tests performed~~ in ~~fiscal~~line ~~years~~with ~~beginning~~our ~~after~~growth ~~December~~in ~~15, 2019; early adoption is permitted. The Company is currently~~earnings ~~evaluating~~during the ~~impact~~first ofnine ~~this~~months ~~new~~of ~~standard on its consolidated financial statements~~2017.

32Results of Operations

~~In May 2017, the FASB~~Three ~~issued~~Months ~~ASU~~Ended ~~No.~~September 2017-09 “Compensation – Stock Compensation (Topic 718): Scope of Modification Accounting”. ASU 2017-09 clarifies when to account for a change to the terms or conditions of a share-based payment award as a modification. Under the new guidance30, modification accounting is required only if the fair value, the vesting conditions or the classification of the award changes as a result of the change in terms or conditions. This ASU is effective prospectively for annual periods beginning on or after December 15, 2017, ~~with~~and ~~early adoption permitted. Management does not believe the adoption of this ASU would have a material effect on the Company’s consolidated financial statements.~~2016

~~Item~~The following 3table sets forth a breakdown of revenue for the periods indicated, both in dollar amount and as a percentage of total revenues. ~~Quantitative~~The information should be read together with our unaudited condensed consolidated interim financial statements and ~~Qualitative~~related notes ~~Disclosures~~included ~~about~~elsewhere ~~Market~~in ~~Risk~~this report.

Not applicable.

	Three Months Ended September 30,
	2017					2016
	Amount		% of Total			Amount		% of Total
Loan origination service fees	$	8,392.527		59	%	$	5,106,877		72	%
Loan repayment management fees		5,253,786		37	%		1,967,675		28	%
Financing income from entrusted loans		636,449		4	%		—		—
Total	$	14,282,762		100	%	$	7,074,552		100	%

~~Item 4. Controls and Procedures~~Revenue

~~Conclusion~~Our revenues ~~Regarding~~for the ~~Effectiveness~~three months ended September 30, 2017 and 2016 mainly consisted of ~~Disclosure~~loan ~~Controls~~ origination service fees and ~~Procedures~~repayment management fees we charge borrowers on the loans facilitated through our online platform. We also generated financing income through our entrusted loan business for the three months ended September 30, 2017 while no such business for the three months ended September 30, 2016.

~~Our management maintains disclosure controls~~The ~~and~~online ~~procedures,~~Peer-to-Peer aslending ~~defined~~platform inindustry ~~Rules~~has ~~13a-15(e)~~experienced ~~and~~rapid ~~15d-15(e)~~growth ofin ~~the~~China ~~Securities~~in ~~Exchange~~recent ~~Act of 1934~~years, ascoupled ~~amended~~with (the ~~“Exchange~~increased ~~Act”)~~marketing campaigns, ~~that~~promotion ~~are~~activities ~~designed~~on toour ~~provide~~platform ~~reasonable~~and ~~assurance~~brand ~~that~~awareness ~~the~~of ~~material~~our ~~information~~online ~~required~~marketplace, toour berevenue ~~disclosed by us in~~approximately ~~our~~doubled ~~periodic~~from ~~reports~~approximately ~~filed~~$7.1 ormillion ~~submitted~~for ~~under~~ the ~~Exchange~~three ~~Act~~months isended ~~recorded,~~September ~~processed~~30, ~~summarized,~~2016 ~~and~~to ~~reported~~approximately ~~within~~$14.3 ~~the~~million ~~time periods~~for ~~specified in~~ the ~~SEC’s~~three months ~~rules~~ended ~~and~~September ~~forms. Disclosure controls and procedures include~~30, ~~without~~2017. ~~limitation,~~Loans ~~controls and~~facilitated ~~procedures~~through ~~designed~~our toplatform ~~ensure~~increased ~~that~~from ~~information~~approximately ~~required~~RMB to1.5 bebillion ~~disclosed by us~~ in the ~~reports that we file or submit under the~~three ~~Exchange~~months ~~Act~~ended isSeptember ~~accumulated~~30, ~~and~~2016 ~~communicated~~ to ~~our~~approximately ~~management,~~RMB ~~including~~2.6 ~~our~~billion ~~Chief~~in ~~Executive~~the ~~Officer~~same ~~and~~period ~~Chief~~in ~~Financial Officer~~2017, to ~~allow~~a ~~timely~~73.3% ~~decisions regarding required disclosure~~increase.

AsSpecifically, loan oforigination ~~June~~service ~~30,~~fee ~~2017~~increased by approximately $3.3 million, ~~our~~or ~~management~~64.3%, ~~under~~ to approximately $8.4 million for the ~~supervision~~third quarter of ~~and~~2017 ~~with~~from approximately $5.1 million for the ~~participation~~same period of ~~our~~last ~~Chief~~year. ~~Executive~~Loan ~~Officer~~repayment ~~and~~management ~~Chief~~fee ~~Financial~~increased ~~Officer~~by approximately $3.3 million, ~~evaluated~~or 167.0%, to approximately $5.3 million for the ~~effectiveness~~third quarter of 2017 from approximately $2.0 million for the same period of ~~our~~last ~~disclosure~~year. ~~controls~~Loan origination service fee and ~~procedures~~repayment asmanagement ~~required~~fee byaccounted ~~Rules~~for ~~13a-15(b)~~59% and ~~15d-15(b)~~37% ~~under~~of our total revenue for the ~~Exchange~~third ~~Act.~~quarter ~~Based~~of ~~upon~~2017, ~~this evaluation~~respectively, ~~our~~as ~~Chief~~compared ~~Executive~~to ~~Officer~~72% and ~~Chief~~28% ~~Financial~~in ~~Officer~~the ~~concluded~~same ~~that~~period ~~our~~of ~~disclosure~~2016. ~~controls~~The ~~and~~change ~~procedures~~is ~~were not~~due ~~effective~~to asthe shift in structure of ~~June~~our ~~30,~~loan ~~2017~~products astowards longer duration loans. Since our loan repayment management fee is based on a ~~result~~certain percentage of the ~~material~~borrowing ~~weaknesses~~times ~~identified~~the induration ~~our~~of ~~internal~~a ~~control~~loan, ~~over~~the ~~financial~~more ~~reporting~~loans with longer terms, ~~which~~ ~~are~~the ~~discussed~~more ~~below.~~loan ~~Our~~repayment management fees ~~considers~~we ~~our~~generate. ~~internal~~We ~~control~~expect ~~over~~this ~~financial~~trend ~~reporting~~will tocontinue beas anthe ~~integral~~industry ~~part~~becomes ofmore ~~our~~regulated and investors are getting more comfortable ~~disclosure~~investing ~~controls~~in ~~and~~loans ~~procedures~~with longer terms. We will continue to adjust our loan product offerings accordingly.

~~Specifically~~In addition, ~~our~~In ~~management~~June ~~identified certain~~2017, ~~matters~~the ~~involving~~Company ~~internal~~started ~~control~~to ~~and~~lend ~~our~~entrusted ~~operations~~loans ~~that~~through ita ~~considered~~licensed toloan beprovider ~~material~~to ~~weaknesses.~~SME Asand ~~defined~~individual borrowers in ~~the~~China. ~~Exchange Act,~~The aCompany ~~material~~has ~~weakness~~engaged isQingdao aWeichuang ~~deficiency,~~as orpartner aat ~~combination~~launch of ~~deficiencies,~~the inservice. ~~internal~~As ~~control~~of ~~over~~September ~~financial~~30, ~~reporting~~2017, ~~such~~the ~~that~~Company ~~there~~granted isentrusted aloans ~~reasonable~~in ~~possibility~~the ~~that~~aggregate aprincipal ~~material~~amount ~~misstatement~~ of ~~the~~$35,312,326 ~~registrant’s annual~~ (or ~~interim~~RMB ~~financial~~235 ~~statements~~million) ~~will not~~to beSME ~~prevented~~borrowers. orThis ~~detected~~is onour afirst series ~~timely~~of ~~basis.~~transactions ~~The~~in ~~material~~which ~~weaknesses~~the ~~identified~~Company, bythrough ~~our~~a ~~management as of June 30~~partner, ~~2017,~~ are ~~that we~~lending ~~did~~funds ~~not~~directly ~~design,~~to ~~implement,~~borrowers. orThe ~~maintain~~loans ~~effective~~are ~~entity~~short-~~level~~term loans ~~controls~~between ~~related~~three toand ~~our~~six ~~control~~months ~~environment,~~with ~~resulting~~interest inpayable ~~the following~~on ~~significant~~a ~~control~~monthly ~~deficiencies:~~basis.

~~● The Code of Business Conduct and Ethics, which was specifically designed for public company applicability, has yet to be formally acknowledged by members of management and the finance department;~~Operating Expenses

●Our total ~~There~~operating isexpenses anincreased ~~absence~~from ofapproximately ~~independence~~$5.2 ~~and~~million ~~financial~~in ~~expertise on~~ the ~~Board~~third quarter of ~~Directors,~~2016 ~~and~~to weapproximately do$7.9 ~~not~~million in ~~have~~the ansame ~~Audit~~period ~~Committee~~of ~~or a formalized internal audit function~~2017, ~~limiting~~increased ~~its~~by ~~ability~~52.9% tofrom ~~provide~~the ~~effective~~same ~~oversight~~period oflast ~~our management;~~year.

● We lacked sufficiently-trained personnel to provide for adequate segregation of duties within the accounting system and effective oversight of controls over access, change, data, and security management; 31

● The following ~~There~~table issets ~~insufficient~~forth ~~knowledge~~the ~~and~~main ~~experience~~components ~~among~~of our ~~internal~~operating ~~accounting~~expenses ~~personnel~~for ~~regarding~~ the ~~application~~three ofmonths USended ~~GAAP~~September ~~and~~30, ~~SEC~~2017 ~~requirements;~~and 2016:

● There are insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of US GAAP and SEC disclosure requirements.

	Three Months Ended September 30,
	2017					2016
		Amount	% of Total				Amount	% of Total
Sales & Marketing Expenses	$	6,368,604		80.9	%	$	4,486,424		87.1	%
General & Administrative Expenses		1,384,646		17.6	%		529,873		10.3	%
Business & related taxes		58,117		0.7	%		82,028		1.6	%
Depreciation		64,872		0.8	%		53,629		1.0	%
Total Operating Expenses	$	7,876,239		100	%	$	5,151,954		100	%

~~Planned~~Our sales ~~Remediation~~and marketing expenses increased by 42% from approximately $4.5 million in the third quarter of 2016 to approximately $6.4 million in the third quarter of 2017. The increase was primarily due to the increase in expenses associated with sales and marketing efforts and promotion activities resulting in higher volume of loans facilitated through our platform. Our general and administrative expenses increased by 161.3% from approximately $0.5 million in the third quarter of 2016 to approximately $1.4 million in the third quarter of 2017, primarily due to expenses related to public company listing on the OTCQB. Business and related taxes are levied on value-added tax which is charged on revenue. Our business and related taxes decreased by $23,911 in the third quarter of 2017 comparing to the same period of last year, offset with an increase of $11,243 in depreciation expense in the third quarter of 2017. In the both periods, business and related tax expense and depreciation expense accounted for a small portion of the Company’s operating expense.

~~As financial conditions permit, we plan~~Other toIncome ~~take the following actions to improve our internal control over financial reporting.~~(Expenses)

33Interest income for the three months ended September 30, 2017 increased to $27,237 from $23,657 for the three months ended September 30, 2016 as a result of more interest earned on cash in bank. We incurred interest expense and bank charges in the amount of $339,300 for the three months ended September 30, 2017, primarily due to interest accrued on convertible notes issued on June 30, 2017. We recognized realized gain on investments in the amount of $93,752 for the three months ended September 30, 2017, attributable to the wealth management product and money market fund purchased with Jiangxi Bank. We did not have such investments for the same period in 2016.

●Provision for ~~Implement~~Income a Code of Business Conduct and Ethics and require all members of our management and the finance department across all corporate entities to certify receipt of the Code of Business Conduct and Ethics by signature. Signed copies will be retained by our management. Thereafter, our management plans to periodically require signatories to acknowledge that they understand the contents of the Code of Business Conduct and Ethics, and whether they are aware of anyone in our Company that might have violated some part of the Code.Taxes

●Due to ~~Recruit~~increase anin ~~independent financial expert to~~ the ~~Board~~income ofbefore ~~Directors~~tax, toprovision ~~chair~~for anincome ~~Audit~~taxes ~~Committee~~amounted ~~and~~to ~~formalize~~$1.4 ~~roles~~million and ~~responsibilities~~$0.5 ~~over~~million ~~our internal control over financial reporting~~ for the ~~Board~~three ~~and~~months ended ~~our~~September ~~management.~~30, ~~Our~~2017 ~~management also plans to develop~~ and ~~implement a formal corporate internal audit capability~~2016, ~~reporting directly to an independent Audit Committee, to provide effective oversight of our internal control over financial reporting~~respectively.

● Engage the services of qualified consultants with China GAAP, U.S. GAAP and SEC reporting experience to support our financial reporting and SOX compliance requirements, including assistance with the following:Net Income

–Because of ~~Remediating~~rapid ~~identified~~industry ~~material~~growth, ~~weaknesses;~~our effective sales and marketing efforts and promotion activities, as well as increased brand awareness of our online marketplace, we were able to further utilize our established online platform and grow our revenue at a higher pace than operating expenses in the third quarter of 2017. For the three months ended September 30, 2017, we recorded net income of approximately $4.8 million, a 33.3% net profit margin, as compared to net income of approximately $1.5 million with 20.6% net profit margin in the same period of last year.

~~– Monitoring our internal control over financial reporting on an ongoing basis;~~ 32

–Nine Months ~~Managing~~Ended ~~our~~September ~~period-end~~30, ~~financial~~2017 ~~closing~~ and ~~reporting processes; and~~2016

–The following ~~Identifying~~table sets forth a breakdown of revenue for the periods indicated, both in dollar amount and ~~resolving~~as ~~non-routine~~a orpercentage ~~complex~~of ~~accounting~~total revenues. ~~matters~~The information should be read together with our unaudited condensed consolidated interim financial statements and related notes included elsewhere in this report.

● Complete the implementation of, and related training for, our IT policies and procedures related to access, change, data, and security management to ensure that all relevant financial information is secure, identified, captured, processed, and reported within the accounting system and spreadsheets supporting financial reporting.

	Nine Months Ended September 30,
	2017					2016
	Amount		% of Total			Amount		% of Total
Loan origination service fees	$	20,038,149		61	%	$	13,255,943		72	%
Loan repayment management fees		12,293,909		37	%		5,126,156		28	%
Financing income from entrusted loans		636,449		2	%		—		—
Total	$	32,968,507		100	%	$	18,382,099		100	%

● Continue providing training to accounting personnel regarding our significant policies and procedures related to accounting, finance, and internal control to ensure that financial reporting competencies are strengthened.Revenue

●Our revenues ~~Arrange~~ for ~~our~~the ~~senior~~nine ~~management~~months ~~and~~ended ~~certain~~September ~~accounting~~30, 2017 and ~~finance-related~~2016 ~~personnel~~mainly toconsisted ~~attend~~of ~~training~~loan ~~sessions~~origination service fees and repayment management fees we charge borrowers on USthe ~~GAAP~~loans ~~and~~facilitated ~~financial~~through ~~reporting~~our ~~responsibilities~~online ~~and~~platform. ~~SEC~~We ~~disclosure~~also ~~requirements;~~generated financing income through our entrusted loan business for the three months ended September 30, 2017 while no such business for the three months ended September 30, 2016.

~~Our~~The online ~~management~~Peer-to-Peer ~~will~~lending ~~continue~~platform toindustry ~~monitor and~~has ~~evaluate~~experienced ~~the~~rapid ~~effectiveness~~growth ofin ~~its~~China ~~disclosure~~in ~~controls~~recent ~~and procedures~~years, ascoupled ~~well~~with asthe ~~its~~increased marketing ~~internal~~campaigns, ~~control~~promotion ~~over~~activities ~~financial reporting,~~ on anour ~~ongoing~~platform ~~basis,~~ and isbrand ~~committed~~awareness toof ~~taking~~our ~~further~~online ~~action~~marketplace, ~~and~~our ~~implementing~~revenue ~~additional~~increased from ~~improvements,~~approximately as$18.4 ~~necessary~~million ~~and~~for asthe ~~funds allow.~~nine ~~However,~~months ~~our~~ended ~~management~~September ~~cannot~~30, ~~guarantee~~2016 ~~that~~to ~~the~~approximately ~~measures~~$33.0 ~~taken~~million orfor ~~any~~the ~~future~~nine ~~measures~~months ended ~~will~~September ~~remediate~~30, ~~the~~2017, ~~material~~representing ~~weaknesses identified~~an orincrease ~~that~~of ~~any~~79.4%. ~~additional~~Loans ~~material~~facilitated ~~weaknesses~~through orour ~~significant~~platform ~~deficiencies~~increased ~~will~~from ~~not~~approximately RMB ~~arise~~3.9 billion in the ~~future~~nine ~~due~~months toended aSeptember ~~failure~~ 30, 2016 to ~~implement~~approximately ~~and~~RMB ~~maintain~~6.3 ~~adequate~~billion ~~internal~~in ~~control~~the ~~over~~same ~~financial~~period ~~reporting~~in 2017, a 61.5% increase.

~~Notwithstanding~~Specifically, loan ~~the~~origination ~~material~~service ~~weaknesses described~~fee ~~above~~increased by approximately $6.8 million, ~~our~~or ~~management~~51.2%, ~~believes~~to ~~that~~approximately ~~there~~$20.0 ~~are~~million nofor ~~material~~the ~~inaccuracies~~first ornine months ~~omissions~~of 2017 from approximately $13.3 million for the same period of ~~material~~last ~~fact~~year. ~~and~~Loan repayment management fee increased by approximately $7.2 million, or 139.8%, to approximately $12.3 million for the ~~best~~ first nine months of ~~its~~2017 ~~knowledge,~~from ~~believes~~approximately ~~that~~$5.1 million for the ~~consolidated~~same ~~financial~~period ~~statements~~of ~~included~~last inyear. ~~this~~Loan ~~annual~~origination ~~report~~service ~~present~~fee ~~fairly~~and repayment management fee accounted for 61% and 37% of our revenue for the first nine months of 2017, respectively, as compared to 72% and 28% in ~~all~~the ~~material~~same period of 2016. The change is due to the ~~respects,~~shift in structure of our ~~financial~~loan ~~position,~~products ~~results~~towards longer duration loans. Since our loan repayment management fee is based on a certain percentage of ~~operations~~the borrowing times the duration of a loan, ~~and~~the ~~cash~~more ~~flows~~loans ~~for~~with longer terms, the ~~periods~~more ~~presented~~loan repayment management fees we generate. We expect this trend will continue as the industry becomes more regulated and investors are getting more comfortable to invest in ~~conformity~~loans with ~~accounting principles~~longer ~~generally~~terms. ~~accepted~~We inwill ~~the~~continue ~~United~~to ~~States~~adjust our loan product offerings accordingly.

~~Changes~~In addition, In June 2017, the Company started to lend entrusted loans through a licensed loan provider to SME and individual borrowers in ~~Internal~~China. ~~Controls~~The ~~over~~Company ~~Financial~~has engaged Qingdao Weichuang as partner at launch of the service. As of September 30, 2017, the Company ~~Reporting~~granted entrusted loans in the aggregate principal amount of $35,312,326 (or RMB 235 million) to SME borrowers. This is our first series of transactions in which the Company, through a partner, are lending funds directly to borrowers. The loans are short-term loans between three and six months with interest payable on a monthly basis.

~~Subject to the foregoing disclosure, there~~Operating were no changes in our internal control over financial reporting that occurred during our fiscal quarter ended June 30, 2017, that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.Expenses

34Our total operating expenses increased from approximately $15.3 million in the first nine months of 2016 to approximately $20.4 million in the same period of 2017, an increase of 33.3%, primarily attributable to the increase in sales and marketing expenses, which increased by 35.4% from the same period last year.

~~PART II. OTHER INFORMATION~~ 33

~~ITEM~~The following 1.table ~~LEGAL~~sets ~~PROCEEDINGS~~forth the main components of our operating expenses for the nine months ended September 30, 2017 and 2016:

We know of no material, active or pending legal proceedings against the Company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

	Nine Months Ended September 30,
	2017					2016
	Amount		% of Total			Amount		% of Total
Sales & Marketing Expenses	$	16,102,865		78.9	%	$	11,893,881		77.7	%
General & Administrative Expenses		4,031,962		19.8	%		3,163,885		20.7	%
Business & related taxes		123,657		0.6	%		122,573		0.8	%
Depreciation		141,330		0.7	%		119,176		0.8	%
Total Operating Expenses	$	20,399,814		100	%	$	15,299,515		100	%

~~ITEM~~Our sales 1Aand marketing expenses increased by 35.4% ~~RISK~~from ~~FACTORS~~approximately $11.9 million in the first nine months of 2016 to approximately $16.1 million in the same period of 2017. The increase was primarily due to the increase in expenses associated with sales and marketing efforts and promotion activities resulting in higher volume of loans facilitated through our platform. Our general and administrative expenses increased by 27.4% from approximately $3.2 million in the first nine months of 2016 to approximately $4.0 million in the same period of 2017, primarily due to expenses related to public company listing on the OTCQB. Business and related taxes are levied on value-added tax which is charged on revenue. The total business and related taxes expense and depreciation expense accounted for 1.3% and 1.6% of total revenue for the related periods, respectively. The increase was mainly due to higher depreciation expense incurred in the first nine months ended September 30, 2017.

~~As a smaller reporting company, the Company is not required~~Other toIncome ~~make disclosures under this Item 1A.~~(Expenses)

~~ITEM~~Interest income 2for the nine months ended September 30, 2017 increased to $183,265 from $83,182 for the nine months ended September 30, 2016 primarily as a result of short-term borrowings we provided to several SME borrowers in May 2017. ~~UNREGISTERED~~We ~~SALES~~incurred OFinterest ~~EQUITY~~expense and ~~SECURITIES~~bank ~~AND~~charges ~~USE~~in OFthe ~~PROCEEDS~~amount of $489,840 for the nine months ended September 30, 2017, primarily due to interest accrued during the offering period on subscription funds for our convertible notes issuance and interest accrued on the convertible notes, which was closed on June 30, 2017. We recognized realized gain on investments in the amount of $310,793 for the nine months ended September 30, 2017, attributable to the short-term investment contracts we signed with Shandong Wenye Investment Co., Ltd. as well as the wealth management product and money market fund purchased with Jiangxi Bank. We did not have such investments in the first nine months of 2016.

~~None.~~Provision for Income Taxes

~~ITEM~~Provision for 3income taxes amounted to $2.9 ~~DEFAULTS~~million ~~UPON~~and ~~SENIOR~~$0.6 ~~SECURITIES~~million for the nine months ended September 30, 2017 and 2016, respectively.

~~None.~~Net Income

~~ITEM~~Because of 4rapid industry growth, our effective sales and marketing efforts and promotion activities, as well as increased brand awareness of our online marketplace, we were able to further utilize our established online platform and grow our revenue at a higher pace than operating expenses in the first nine months of 2017. ~~MINE~~For ~~SAFETY~~the ~~DISCLOSURES~~nine months ended September 30, 2017, we recorded net income of approximately $9.6 million, a 29.3% net profit margin, as compared to net income of approximately $2.5 million with net profit margin of 13.7% in the same period of last year.

~~Not applicable.~~ 34

~~ITEM~~Liquidity and 5.Capital ~~OTHER INFORMATION~~Resources

~~None.~~Sources of Liquidity

~~ITEM~~Cash balances 6at September 30, 2017 and December 31, 2016 were approximately $12.9 ~~EXHIBITS~~million and $8.56 million, respectively.

Exhibit
No.	Description
31.1	Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*
31.2	Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*
32.1	Certification of the Principal Executive Officer pursuant to U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.**
32.2	Certification of the Principal Financial Officer pursuant to U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.**
101.INS	XBRL Instance Document*
101.SCH	XBRL Taxonomy Extension Schema Document*
101.CAL	XBRL Taxonomy Calculation Linkbase Document*
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document*
101.LAB	XBRL Taxonomy Label Linkbase Document*
101.PRE	XBRL Taxonomy Presentation Linkbase Document*

Our principal sources of liquidity were cash generated from operating activities, proceeds from the issuance and sale of our common shares in private placements closed on October 18, 2016 and the issuance of convertible notes closed on June 30, 2017.

*FiledThe following ~~herewith.~~table sets forth a summary of our cash flows for the periods indicated:

**Furnished herewith.


	Nine Months Ended September 30,
Summary of Consolidated Cash Flow Data:	2017			2016
Net cash provided by operating activities	$	20,228,188		$	2,908,994
Net cash used in investing activities		(29,584,916	)		(36,736	)
Net cash provided by financing activities		13,275,151			—
Effect of exchange rate change		462,191			(191,649	)
Cash and cash equivalents:
Net increase		4,380,614			2,680,609
Balance at beginning of period		8,561,695			5,712,741
Balance at end of period	$	12,942,309		$	8,393,350

35During the nine months ended September 30, 2017, we generated approximately 9.6 million net income for the period, collected approximately $1.5 million in prepayment and $5.4 million more for risk reserve fund, and recorded additional $2.6 million in income tax payable. These activities resulted in a net cash provided by operating activities of approximately $20.2 million.

~~SIGNATURES~~Net cash used in investing activities totaled approximately $29.6 million for the nine months ended September 30, 2017. During the first nine months of 2017, we paid approximately $0.6 million for fixed assets acquisition. Upon expiration of the two short-term entrusted financial management contracts signed with Shandong Wenye Investment Co., Ltd. (“Wenye”), Wenye returned to the Company the entrusted principals in the aggregate amount of approximately $8.4 million. In addition, pursuant to a share transfer framework agreement signed with certain shareholders of Shenzhen TouZhiJia Financial Information Service Co., Ltd. (“TouZhiJia”) in June 2017, the Company paid $2.8 million for acquiring a 4.45% equity interest in TouZhiJia. The Company launched the lending business of entrusted loan on June 30, 2017 through Qingdao Weichuang private Capital Management Co., Ltd (“Qingdao Weichuang”) as a partner and lent a total of $34.5 million in entrusted loans to Small-to-Medium Enterprise borrowers through September 30, 2017. All loans receivable consists of loans to small and medium sized enterprise (“SME”) with the term period ranging from 3 months to 6 months.

~~Pursuant to the requirements of the Securities~~ ~~Exchange Act of 1934, the registrant caused this report to be signed on its behalf by the undersigned thereunto duly authorized.~~35

	SINO FORTUNE HOLDING CORPORATION
Date: August 21, 2017	By:	/s/ Bodang Liu
		Bodang Liu
		Chief Executive Officer
		(Principal Executive Officer) and Director
Date: August 21, 2017	By:	/s/ Wei Zheng
		Wei Zheng
		Chief Financial Officer
		(Principal Financial Officer)

Net cash provided by financing activities totaled approximately $13.3 million during the nine months ended September 30, 2017. On June 30, 2017, we entered into a securities purchase agreement with various investors, pursuant to which we issued and sold senior convertible promissory notes in the aggregate principal amount of $13.3 million (RMB 90,357,316.73) (the “Notes”), convertible into shares of the Company’s Common Stock following June 30, 2018 at a conversion price of $2.00 per share (the “Conversion Price”) in a private placement. The Notes mature on June 30, 2020 and accrue interest at a rate of 6%, 7% and 8% per annum for each of the first, second and third year, respectively, with such interest payable annually. In event of a conversion of the Notes, the investors have agreed to a one year lock-up period with respect to the shares of Common Stock issuable upon conversion of the Notes commencing on the applicable conversion date of the Notes. The Notes are secured by a pledge of shares of the Common Stock pursuant to a stock pledge agreement (the “Stock Pledge Agreement”) between Avis Genesis Inc., a majority shareholder of the Company, and the investors on the basis of one share of Common Stock per $1 loaned under the Note. Other than the shares pledged pursuant to the Stock Pledge Agreement, there is no recourse against the Company upon a default of the Notes.

36The resulting change in cash for the nine months ended September 30, 2017 was a net increase of approximately $4.4 million.

During the nine months ended September 30, 2016, net cash provided by operating activities totaled approximately $2.9 million. Net cash used in investing activities totaled approximately $0.04 million. No cash was provided by financing activities during this period. The resulting change in cash for this period was a net increase of approximately $2.7 million, which was primarily due to net income of approximately $2.5 million, offset with the decrease in payables and accruals of approximately $0.8 million, increase in prepayment of $0.7 million and increase in other receivable of $0.8 million.

As of September 30, 2017, we had approximately $50.5 million in total current assets and $19.0 million in total current liabilities, with a current ratio of 2.65. As of December 31, 2016, we had approximately $19.99 million in total current assets and $9.05 million in total current liabilities, representing a current ratio of 2.21. As of September 30, 2017 and December 31, 2016, the risk reserve fund liability was approximately $13.1 million and $7.3 million, respectively. The risk reserve fund is only applied to the loans facilitated through our online platform. In the role of transaction intermediary, we do not assume credit risk for the loans facilitated through our online platform. The Company is not the legal lender and legal borrower in the loan origination and repayment process. The risk reserve liability is limited to the balance of risk reserve fund that the borrowers or guarantors deposit with us.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements, including arrangements that would affect our liquidity, capital resources, market risk support and credit risk support or other benefits.

Critical Accounting Policies

Basis of presentation and principles of consolidation

The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States. The consolidated financial statements include the accounts of The Company, Benefactum Alliance, including its wholly owned subsidiaries Benefactum Sino and WFOE, and its variable interest entity Benefactum Beijing, and have been reported in United States dollars. All inter-company balances and transactions have been eliminated in consolidation.

The series of contractual agreements between WFOE and Benefactum Beijing (see Footnote 1 to financial statements) collectively enable us to exercise effective control over, and realize substantially all of the economic risks and benefits arising from Benefactum Beijing, as well as give us an exclusive option to purchase all or part of the equity interests in it when and to the extent permitted by PRC law. As a result of these contractual arrangements, we have become the primary beneficiary of Benefactum Beijing and determined Benefactum Beijing is our variable interest entity subject to consolidation under U.S. GAAP. Accordingly, the financial statements of Benefactum Beijing are included in the consolidated financial statements of the Company.

Use of Estimates

Preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements as well as the reported amounts of revenues and expenses during the reporting period. Significant estimates required to be made by management include, but are not limited to, useful lives of property, plant and equipment, intangible assets, the recoverability of long-lived assets, allowance for doubtful accounts, and deferred income tax. Actual results could differ from those estimates.

Short-term investments

Short-term investments other than highly liquid ones are classified and accounted for as available-for-sale. Management determines the appropriate classification of its investments at the time of purchase and reevaluates the classifications at each balance sheet date. The Company classifies its investments as either short-term or long-term based on each instrument’s underlying contractual maturity date, the nature of the investment and its availability for use in current operations. The Company’s investments are carried at fair value, with unrealized gains and losses, net of taxes, reported as a component of accumulated other comprehensive income in shareholders’ equity, with the exception of unrealized losses believed to be other-than-temporary, which are reported in earnings in the current period. When we sell an investment, the cost is based on the specific identification method.

Short-term loans receivable, net

Short-term loans receivable represents the outstanding balance of the entrusted loans extended by the Company to borrowers. Loans receivable are recorded at unpaid principal balances, net of allowance for loan losses that reflects the Company’s best estimate of the amounts that will not be collected.

The allowance for loan losses is determined at a level believed to be reasonable to absorb probable losses inherent in the loan portfolio as of each balance sheet date. The allowance is provided based on an assessment performed on a portfolio basis. All loans are assessed collectively depending on factors such as delinquency rate, size, and other risk characteristics of the portfolio.

The Company started the lending business of entrusted loan on June 30, 2017 through Qingdao Weichuang private Capital Management Co., Ltd (“Qingdao Weichuang”) as an agent. All loans receivable consists of loans to small and medium sized enterprise (“SME”) with the term period ranging from 3 months to 6 months. For the three and nine months ended September 30, 2017, the Company provided Nil provision for loan losses, respectively.

Revenue Recognition

Revenues are primarily composed of fees collected from services provided with facilitating loan originations and services provided with assisting in loan repayment process through our online platform.

Loans facilitated through our online platform are mostly short-term loans for working capital purpose, with average life of loan around three to four months. Pursuant to the agreements among the Company, the borrowers and the investors, all principal and interest payments are due and paid off in lump sum at the end of the loan term, with no payments of interest or principal over the duration of the loan. We generally sign electronically a three-party intermediary service agreement with borrowers and investors at the inception of loan, which also specifies the repayment terms with the amounts of principal and interest due at the end of the loan term. The borrowers are obligated to pay a loan origination service fee to us upfront at the time of loan issuance and a loan repayment management fee at the time when the loan is repaid. All loans originated through our online platform are repaid through our online platform. Borrowers are allowed to prepay the loan before the due date, but the borrowers are obligated to pay us the full amount of the loan repayment management fee as if the loans are repaid at the end of the loan term in accordance with agreement.

The Company recognizes revenues under ASC 605 when the following four revenue recognition criteria are met for each revenue type: (i) persuasive evidence of an arrangement exists, (ii) delivery has occurred or services have been rendered, (iii) the selling price is fixed or determinable, and (iv) collectability is reasonably assured.

These criteria as they relate to each of the following major revenue generating activities are described below.

Transactions with online platform’s borrowers and investors

The Company generates loan facilitation service fees and loan repayment service fees by providing the following services:

●

Connecting investors to qualified borrowers and facilitating loan origination between the parties;

●

Providing loan repayment service when loan matures, including facilitating the payment channel and monitoring payments from borrowers and to investors;

Loan origination service is rendered when a loan is successfully matched between the lenders and the borrowers; and when a loan is originated. The origination of a loan takes place when the funds provided by the investor are transferred to the borrower. The borrower is obligated to pay loan origination service fee upfront at loan inception and such service fee is not refundable. Revenue is recognized when loan origination service is rendered and fee is collected from borrower upon the closing of the loan. The aforementioned fee is an agreed upon percentage of the total principal which varies based on the duration of the loan.

Towards the end of each loan term, the Company also provide repayment service to ensure loan repayment process is handled smoothly through our online platform and to assist in release of liens or collaterals if applicable. The Company charges a separate fee for loan repayment management service, which is determined based on an agreed upon percentage on the borrowing times the duration of the loan and is not refundable. Borrowers are obligated to pay loan repayment management fee upon repayment of the loan. Loan repayment management fee is recognized upon the borrower paying the principal, interest and our management fee for the loan repayment service through our online platform.

Entrusted loan lending transactions

Financing income (interest) on loans receivable, is accrued and recognized as income when earned. Accrual of interest is discontinued when reasonable doubt exists as to the full, timely collection of interest or principal (e.g. when the loans have been past due by 90 days). Subsequent recognition of income for loans in non-accrual status occurs only to the extent payment is received, subject to the management’s assessment of the collectability of the remaining interest and principal.

Earnings Per Share (“EPS”)

Reverse Stock Split

On June 20, 2017, the Board of Directors approved a reverse stock split of the Company’s issued and outstanding shares of common stock, par value $0.001 per share (the “Common Stock”), at a ratio of 1-for-5 (the “Reverse Stock Split”). The Reverse Stock Split was effected by the Company filing a Certificate of Change (the “Certificate”) with the Secretary of State of the State of Nevada on June 20, 2017 (the “Effective Date”). As a result of the filing of the Certificate, the number of shares of the Company’s authorized Common Stock was reduced from 2,990,000,000 shares to 598,000,000 shares and the issued and outstanding number of shares of the Company’s Common Stock was correspondingly decreased. The Company received FINRA’s approval of the Reverse Stock Split on August 7, 2017. The Company has retroactively restated all shares and per share data for all the periods presented.

Recent Accounting Pronouncements

In September 2017, the FASB has issued ASU No. 2017-13, “Revenue Recognition (Topic 605), Revenue from Contracts with Customers (Topic 606), Leases (Topic 840), and Leases (Topic 842): Amendments to SEC Paragraphs Pursuant to the Staff Announcement at the July 20, 2017 EITF Meeting and Rescission of Prior SEC Staff Announcements and Observer Comments.” The amendments in ASU No. 2017-13 amends the early adoption date option for certain companies related to the adoption of ASU No. 2014-09 and ASU No. 2016-02. Both of the entities may still adopt using the public company adoption guidance in the related ASUs, as amended. The effective date is the same as the effective date and transition requirements for the amendments for ASU 2014-09 and ASU 2016-02.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Not applicable.

Item 4. Controls and Procedures

Our management maintains disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are designed to provide reasonable assurance that the material information required to be disclosed by us in our periodic reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures 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 our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

As of September 30, 2017, our management, under the supervision of and with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as required by Rules 13a-15(b) and 15d-15(b) under the Exchange Act. Based upon this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were not effective as of September 30, 2017 as a result of the material weaknesses identified in our internal control over financial reporting, which are discussed below. Our management considers our internal control over financial reporting to be an integral part of our disclosure controls and procedures.

Specifically, our management identified certain matters involving internal control and our operations that it considered to be material weaknesses. As defined in the Exchange Act, 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 the registrant’s annual or interim financial statements will not be prevented or detected on a timely basis. The material weaknesses identified by our management as of September 30, 2017, are that we did not design, implement, or maintain effective entity-level controls related to our control environment, resulting in the following significant control deficiencies:

●

The Code of Business Conduct and Ethics, which was specifically designed for public company applicability, has yet to be formally acknowledged by members of management and the finance department;

●

There is an absence of independence and financial expertise on the Board of Directors, and we do not have an Audit Committee or a formalized internal audit function, limiting its ability to provide effective oversight of our management;

●

We lacked sufficiently-trained personnel to provide for adequate segregation of duties within the accounting system and effective oversight of controls over access, change, data, and security management;

●

There is insufficient knowledge and experience among our internal accounting personnel regarding the application of US GAAP and SEC requirements;

●

There are insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of US GAAP and SEC disclosure requirements.

Planned Remediation

As financial conditions permit, we plan to take the following actions to improve our internal control over financial reporting.

●

Implement a Code of Business Conduct and Ethics and require all members of our management and the finance department across all corporate entities to certify receipt of the Code of Business Conduct and Ethics by signature. Signed copies will be retained by our management. Thereafter, our management plans to periodically require signatories to acknowledge that they understand the contents of the Code of Business Conduct and Ethics, and whether they are aware of anyone in our Company that might have violated some part of the Code.


	●	Recruit an independent financial expert to the Board of Directors to chair an Audit Committee and formalize roles and responsibilities over our internal control over financial reporting for the Board and our management. Our management also plans to develop and implement a formal corporate internal audit capability, reporting directly to an independent Audit Committee, to provide effective oversight of our internal control over financial reporting.


	●	Engage the services of qualified consultants with China GAAP, U.S. GAAP and SEC reporting experience to support our financial reporting and SOX compliance requirements, including assistance with the following:


	-	Remediating identified material weaknesses;

Monitoring our internal control over financial reporting on an ongoing basis;

Managing our period-end financial closing and reporting processes; and

Identifying and resolving non-routine or complex accounting matters.


	●	Complete the implementation of, and related training for, our IT policies and procedures related to access, change, data, and security management to ensure that all relevant financial information is secure, identified, captured, processed, and reported within the accounting system and spreadsheets supporting financial reporting.

●

Continue providing training to accounting personnel regarding our significant policies and procedures related to accounting, finance, and internal control to ensure that financial reporting competencies are strengthened.

●

Arrange for our senior management and certain accounting and finance-related personnel to attend training sessions on US GAAP and financial reporting responsibilities and SEC disclosure requirements;

Our management will continue to monitor and evaluate the effectiveness of its disclosure controls and procedures, as well as its internal control over financial reporting, on an ongoing basis, and is committed to taking further action and implementing additional improvements, as necessary and as funds allow. However, our management cannot guarantee that the measures taken or any future measures will remediate the material weaknesses identified or that any additional material weaknesses or significant deficiencies will not arise in the future due to a failure to implement and maintain adequate internal control over financial reporting.

Notwithstanding the material weaknesses described above, our management believes that there are no material inaccuracies or omissions of material fact and, to the best of its knowledge, believes that the consolidated financial statements included in this annual report present fairly, in all material respects, our financial position, results of operations, and cash flows for the periods presented in conformity with accounting principles generally accepted in the United States.

Changes in Internal Controls over Financial Reporting

Subject to the foregoing disclosure, there were no changes in our internal control over financial reporting that occurred during our fiscal quarter ended September 30, 2017, that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

ITEM 1A. RISK FACTORS

As a smaller reporting company, the Company is not required to make disclosures under this Item 1A.

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 No.	Description

31.1	Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*
31.2	Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*
32.1	Certification of the Principal Executive Officer pursuant to U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.**
32.2	Certification of the Principal Financial Officer pursuant to U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.**
101.INS	XBRL Instance Document*
101.SCH	XBRL Taxonomy Extension Schema Document*
101.CAL	XBRL Taxonomy Calculation Linkbase Document*
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document*
101.LAB	XBRL Taxonomy Label Linkbase Document*
101.PRE	XBRL Taxonomy Presentation Linkbase Document*

*Filed herewith.

**Furnished herewith.

SIGNATURES

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

	Hui Ying Financial Holdings Corporation

Date: November 14, 2017	By:	/s/ Bodang Liu
		Bodang Liu
		Chief Executive Officer
		(Principal Executive Officer) and Director

Date: November 14, 2017	By:	/s/ Wei Zheng
		Wei Zheng
		Chief Financial Officer
		(Principal Financial Officer)

Filing Compare · HUI YING FINANCIAL HOLDINGS Corp