UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 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 DECEMBER 31, 2020

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

Commission File Number 000-54761

NOBLE VICI GROUP, INC.

(Exact Name of Registrant as Specified in Its Charter)

Delaware		42-1772663
(State or Other Jurisdiction		(I.R.S. Employer
of Incorporation or Organization)		Identification No.)

45 Ubi Crescent

Singapore 408590

+65 6491 7998
(Address of Principal Executive Offices and Issuer’s
Telephone Number, including Area Code)

1 Raffles Place, #33-02

One Raffles Place Tower One

Singapore 048616

+65 6491 7998
(Former Address of Principal Executive Offices and Issuer’s
Telephone Number, including Area Code)

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

Securities registered pursuant to Section 12(g) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.0001 par value	NVGI	N/A

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

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

	Large accelerated filer ☐	Accelerated filer ☐
	Non-accelerated filer ☐	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 Exchange Act). Yes ☐ No ☒

As of February 9, 2021, the issuer had outstanding 210,804,160 shares of common stock.

TABLE OF CONTENTS

		Page

PART I	FINANCIAL INFORMATION

ITEM 1	Financial Statements	4

	Condensed Consolidated Balance Sheets as of December 31, 2020 (Unaudited) and March 31, 2020 (Audited)	4

	Condensed Consolidated Statements of Operations and Comprehensive Loss for the Three and Nine Months Ended December 31, 2020 and 2019 (Unaudited)	5

	Condensed Consolidated Statement of Changes in Stockholders’ Equity (Deficit) for the Three Months and Nine Months ended December 31, 2020 and 2019 (Unaudited)	6

	Condensed Consolidated Statements of Cash Flows for the Nine Months Ended December 31, 2020 and 2019 (Unaudited)	8

	Notes to Condensed Consolidated Financial Statements (Unaudited)	8

ITEM 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	26

ITEM 3	Quantitative and Qualitative Disclosures about Market Risk	45

ITEM 4	Controls and Procedures	46

PART II	OTHER INFORMATION	47

ITEM 1	Legal Proceedings	47

ITEM 1A	Risk Factors	48

ITEM 2	Unregistered Sales of Equity Securities and Use of Proceeds	49

ITEM 3	Defaults upon Senior Securities	49

ITEM 4	Mine Safety Disclosures	49

ITEM 5	Other Information	49

ITEM 6	Exhibits	49

SIGNATURES		51

CAUTIONARY NOTE CONCERNING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended that are not historical facts, and involve risks and uncertainties that could cause actual results to differ materially from those expected and projected. All statements, other than statements of historical facts, included in this Form 10-Q including, without limitation, statements in the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” regarding the Company’s financial position, business strategy and the plans and objectives of management for future operations, events or developments which the Company expects or anticipates will or may occur in the future, including such things as future capital expenditures (including the amount and nature thereof); expansion and growth of the Company's business and operations; and other such matters are forward-looking statements. These statements are based on certain assumptions and analyses made by the Company in light of its experience and its perception of historical trends, current conditions and expected future developments, as well as other factors it believes are appropriate under the circumstances. However, whether actual results or developments will conform with the Company's expectations and predictions is subject to a number of risks and uncertainties, including general economic, market and business conditions; the business opportunities (or lack thereof) that may be presented to and pursued by the Company; changes in laws or regulation; and other factors, most of which are beyond the control of the Company.

These forward-looking statements can be identified by the use of predictive, future-tense or forward-looking terminology, such as "believes," "anticipates," "expects," "estimates," "plans," "may," "will," or similar terms. These statements appear in a number of places in this filing and include statements regarding the intent, belief or current expectations of the Company, and its directors or its officers with respect to, among other things: (i) trends affecting the Company's financial condition or results of operations for its limited history; (ii) the Company's business and growth strategies; and, (iii) the Company's financing plans. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve significant risks and uncertainties, and that actual results may differ materially from those projected in the forward-looking statements as a result of various factors. Such factors that could adversely affect actual results and performance include, but are not limited to, the Company's limited operating history, potential fluctuations in quarterly operating results and expenses, government regulation, technological change and competition. For information identifying important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, please refer to the Risk Factors section of the Company’s Current Report on Form 8-K filed with the U.S. Securities and Exchange Commission (the “SEC”) on August 8, 2018.

Consequently, all of the forward-looking statements made in this Form 10-Q are qualified by these cautionary statements and there can be no assurance that the actual results or developments anticipated by the Company will be realized or, even if substantially realized, that they will have the expected consequence to or effects on the Company or its business or operations. The Company assumes no obligations to update any such forward-looking statements.

Currency and exchange rate

Unless otherwise noted, all currency figures quoted as “U.S. dollars”, “dollars” or “$” refer to the legal currency of the United States. Throughout this report, assets and liabilities of the Company’s subsidiaries are translated into U.S. dollars using the exchange rate on the balance sheet date. Revenue and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements of foreign subsidiaries are recorded as a separate component of accumulated other comprehensive income within the statement of stockholders’ equity.

PART I FINANCIAL INFORMATION

ITEM 1 Financial Statements

NOBLE VICI GROUP, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

AS OF DECEMBER 31, 2020 AND MARCH 31, 2020

(Currency expressed in United States Dollars (“US$”), except for number of shares)

	December 31, 2020			March 31, 2020
		(Unaudited)			(Audited)
ASSETS
Current assets:
Cash and cash equivalents	$	35,368		$	223,527
Accounts receivable		158,827			152,545
Purchase deposits		1,744,364			1,619,966
Deferred costs		4,809,553			4,252,107
Deposits, prepayment and other receivable		496,575			418,541
Tax recoverable		–			65,403
Inventories		15,440			14,339
Total current assets		7,260,127			6,746,428

Non-current assets:
Intangible assets, net		4,884			6,170
Property, plant and equipment, net		3,716,635			3,467,527
Total non-current assets		3,721,519			3,473,697

TOTAL ASSETS	$	10,981,646		$	10,220,125

LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Accrued liabilities and account payables	$	3,115,408		$	2,216,563
Commission liabilities		1,112,209			1,045,568
Deferred revenue		6,988,129			6,239,296
Amount due to a director		1,075,613			17,662
Amount due to a related party		280,317			280,317
Tax payable		131,119			–
Current portion of borrowings		363,345			256,758
Total current liabilities		13,066,140			10,056,164

Long-term liabilities:
Borrowings		1,672,060			1,692,485

TOTAL LIABILITIES		14,738,200			11,748,649

Commitments and contingencies		–			–

STOCKHOLDERS’ DEFICIT
Common stock, 3,000,000,000 authorized common shares of $0.0001 par value, 210,804,160 shares issued and outstanding as of December 31, 2020 and March 31, 2020		21,080			21,080
Additional paid up capital		136,427,910			136,427,910
Accumulated other comprehensive loss		(271,658	)		(218,893	)
Accumulated losses		(139,876,857	)		(137,703,504	)
Total NVGI stockholders’ deficit		(3,699,525	)		(1,473,407	)
Non-controlling interest		(57,029	)		(55,117	)
		(3,756,554	)		(1,528,524	)

TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT	$	10,981,646		$	10,220,125

See accompanying notes to unaudited condensed consolidated financial statements.

NOBLE VICI GROUP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”))

(Unaudited)

	Three months ended December 31,						Nine months ended December 31,
	2020			2019			2020			2019

REVENUE, NET	$	149,400		$	2,063,937		$	399,475		$	14,674,821

Cost of revenue		(9,676	)		(2,250,717	)		(94,992	)		(8,311,170	)

Gross profit (loss)		139,724			(186,780	)		304,483			6,363,651

Operating expenses:
Sales and marketing		41,782			83,651			475,363			421,972
General and administrative		588,126			1,116,808			2,182,625			3,372,306
Stock-based compensation		–			200,000			–			11,136,760
Total operating expenses		629,908			1,400,459			2,657,988			14,931,038

LOSS FROM OPERATIONS		(490,184	)		(1,587,239	)		(2,353,505	)		(8,567,387	)

Other (expense) income:
Interest expense		(32,697	)		(22,545	)		(70,945	)		(67,110	)
Government subsidy income		69,458			14,632			313,566			14,632
Management fee income		4,721			11,024			13,509			43,897
Sundry income		2,948			1,346			22,035			27,392
Total other income		44,430			4,457			278,165			18,811

LOSS BEFORE INCOME TAXES		(445,754	)		(1,582,782	)		(2,075,340	)		(8,548,576	)

Income tax (expense) credit		(51,943	)		29,779			(99,925	)		18,555

NET LOSS	$	(497,697	)	$	(1,553,003	)	$	(2,175,265	)	$	(8,530,021	)

Less: Net loss attributable to non-controlling interest		(2,518	)		(126,020	)		(1,912	)		(61,412	)

Net loss attributable to NVGI	$	(495,179	)	$	(1,426,983	)	$	(2,173,353	)	$	(8,468,609	)

NET LOSS		(497,697	)		(1,553,003	)		(2,175,265	)		(8,530,021	)

Other comprehensive loss:
– Foreign currency translation (loss) gain		(40,081	)		4,957			(52,765	)		(156,512	)

COMPREHENSIVE LOSS	$	(537,778	)	$	(1,548,046	)	$	(2,228,030	)	$	(8,686,533	)

Net loss per share:
– Basic and diluted	$	(0.00	)	$	(0.01	)	$	(0.01	)	$	(0.04	)

Weighted average common shares outstanding:
– Basic and diluted		210,804,160			210,773,725			210,804,160			210,727,433

See accompanying notes to unaudited condensed consolidated financial statements.

NOBLE VICI GROUP, INC.

CODENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)

FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

										Accumulated
										other						Total
					Additional					comprehensive						stockholders’			Non-
	Common stock				paid in		Deferred			(loss)			Accumulated			equity			controlling			Total
	No. of shares		Amount		capital		compensation			income			Losses			(deficit)			interest			equity

Balance as of April 1, 2019 (audited)		210,704,160	$	21,070	$	136,227,920		(10,936,760	)	$	20,089		$	(125,141,278	)	$	191,041			(106,069	)	$	84,972

Amortization of deferred compensation		–		–		–		10,936,760			–			–			10,936,760			–			10,936,760

Foreign currency translation adjustment		–		–		–		–			(2,897	)		–			(2,897	)		–			(2,897	)

Net loss for the period		–		–		–		–			–			(6,856,165	)		(6,856,165	)		15,661			(6,840,504	)

Balance as of June 30, 2019		210,704,160	$	21,070	$	136,227,920	$	–		$	17,192		$	(131,997,443	)	$	4,268,739		$	(90,408	)	$	4,178,331

Foreign currency translation adjustment		–		–		–		–			(158,572	)		–			(158,572	)		3,569			(155,003	)

Net loss for the period		–		–		–		–			–			(185,461	)		(185,461	)		48,947			(136,514	)

Balance as of September 30, 2019		210,704,160	$	21,070	$	136,227,920	$	–			(141,380	)	$	(132,182,904	)	$	3,924,706			(37,892	)	$	3,886,814

Shares issued for legal service		100,000		10		199,990		–			–			–			200,000			–			200,000

Foreign currency translation adjustment		–		–		–		–			4,957			–			4,957			–			4,957

Net loss for the period		–		–		–		–			–			(1,426,983	)		(1,426,983	)		(126,020	)		(1,553,003	)

Balance as of December 31, 2019		210,804,160	$	21,080	$	136,427,910	$	–		$	(136,423	)	$	(133,609,887	)	$	2,702,680			(163,912	)	$	2,538,768

NOBLE VICI GROUP, INC.

CODENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT) (continued)

FOR THE THREE AND NINE MONTHS ENDED DECEMBER 31, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

									Accumulated
									other						Total
					Additional				comprehensive						stockholders’			Non-
	Common stock				paid in		Deferred		(loss)			Accumulated			equity			controlling			Total
	No. of shares		Amount		capital		compensation		income			Losses			(deficit)			interest			equity

Balance as of April 1, 2020 (audited)		210,804,160	$	21,080	$	136,427,910	$	–	$	(218,893	)	$	(137,703,504	)	$	(1,473,407	)		(55,117	)	$	(1,528,524	)

Foreign currency translation adjustment		–		–		–		–		(18,892	)		–			(18,892	)		–			(18,892	)

Net loss for the period		–		–		–		–		–			(825,678	)		(825,678	)		3,687			(821,991	)

Balance as of June 30, 2020		210,804,160	$	21,080	$	136,427,910	$	–	$	(237,785	)	$	(138,529,182	)	$	(2,317,977	)	$	(51,430	)	$	(2,369,407	)

Foreign currency translation adjustment		–		–		–		–		6,208			–			6,208			–			6,208

Net loss for the period		–		–		–		–		–			(852,496	)		(852,496	)		(3,081	)		(855,577	)

Balance as of September 30, 2020		210,804,160	$	21,080	$	136,427,910	$	–		(231,577	)	$	(139,381,678	)	$	(3,164,265	)		(54,511	)	$	(3,218,776	)

Foreign currency translation adjustment		–		–		–		–		(40,081	)		–			(40,081	)		–			(40,081	)

Net loss for the period		–		–		–		–		–			(495,179	)		(495,179	)		(2,518	)		(497,697	)

Balance as of December 31, 2020		210,804,160	$	21,080	$	136,427,910	$	–		(271,658	)	$	(139,876,857	)	$	(3,699,525	)		(57,029	)	$	(3,756,554	)

See accompanying notes to unaudited condensed consolidated financial statements.

NOBLE VICI GROUP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED DECEMBER 31, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”))

(Unaudited)

	Nine months ended December 31,
	2020			2019
Cash flow from operating activities:
Net loss	$	(2,175,265	)	$	(8,530,021	)
Adjustments for:
Amortization of intangible assets		1,746			206,390
Depreciation of property, plant and equipment		192,573			147,031
Stock compensation expense		–			11,136,760
Gain on disposal of property, plant and equipment		–			(3,604	)

Change in operating assets and liabilities:
Accounts receivable		5,390			4,895,929
Deposits, prepayment and other receivable		60,824			137,637
Deferred cost		(229,139	)		–
Accrued liabilities and account payables		723,002			1,208,080
Commission liabilities		(13,543	)		(404,283	)
Deferred revenue		267,628			(6,001,010	)
Purchase deposits		–			(2,214,407	)
Tax payable		93,623			(131,886	)
Net cash (used in) generated from operating activities		(1,073,161	)		446,616

Cash flow from investing activities:
Proceeds from disposal of property, plant and equipment		–			52,676
Purchase of property, plant and equipment		(77,975	)		(99,741	)

Net cash used in investing activities		(77,975	)		(47,065	)

Cash flow from financing activities:
Advances from (repayment to) a director		1,048,427			(73,089	)
Repayment of loan		(122,586	)		–
Repayment of finance lease		(38,016	)		(161,528	)
Net cash generated from (used in) financing activities		887,825			(234,617	)

Foreign currency translation adjustment		75,152			(173,883	)

Net change in cash and cash equivalents		(188,159	)		(8,949	)

BEGINNING OF PERIOD		223,527			691,331

END OF PERIOD	$	35,368		$	682,382

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for income taxes	$	3,071		$	126,312
Cash paid for interest	$	70,945		$	67,110

See accompanying notes to unaudited condensed consolidated financial statements.

NOBLE VICI GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED DECEMBER 31, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

NOTE－1 BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements have been prepared by management in accordance with both accounting principles generally accepted in the United States (“GAAP”), and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Certain information and note disclosures normally included in audited financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to those rules and regulations, although the Company believes that the disclosures made are adequate to make the information not misleading.

In the opinion of management, the consolidated balance sheet as of March 31, 2020 which has been derived from audited financial statements and these unaudited condensed consolidated financial statements reflect all normal and recurring adjustments considered necessary to state fairly the results for the periods presented. The results for the period ended December 31, 2020 are not necessarily indicative of the results to be expected for the entire fiscal year ending March 31, 2021 or for any future period.

NOTE－2 DESCRIPTION OF BUSINESS AND ORGANIZATION

Noble Vici Group, Inc. (the “Company”), formerly known as Gold Union Inc., was incorporated under the laws of the State of Delaware on July 6, 2010 under the name of Advanced Ventures Corp. Effective January 6, 2014, the Company changes its name to “Gold Union Inc.” Effective March 26, 2020, the Company changes its current name to Noble Vici Group, Inc (“NVGI”).

The Company is currently engaged in the IoT, Big Data, Blockchain and E-commerce business.

Description of subsidiaries

Name	Place of incorporation and kind of legal entity	Principal activities and place of operation	Particulars of issued/ registered share capital	Effective interest held

Noble Vici Pte Ltd	Republic of Singapore	Singapore holding company	S$200,001	100%

NIApplications Pte Ltd	Republic of Singapore	Development of software for interactive digital media and software consultancy	S$1	100%

Noble Digital Apps Sendirian Berhad	Federation of Malaysia	Digital apps and big data business	MYR1,000	51%

The Digital Agency Pte. Ltd.	Republic of Singapore	Business and management consultancy services	S$1	51%

NOBLE VICI GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED DECEMBER 31, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

Venvici Ltd	Republic of Seychelles	Business and management consultancy services on e-commerce service	US$50,000	100%

Ventrepreneur (SG) Pte Ltd	Republic of Singapore	Online retailing	S$10,000	100%

Ventrepreneur (SG) Pte Ltd, Taiwan Branch	Taiwan Branch	Customer service for ecommerce and merchants servicing	N/A	N/A

UB45 Pte Limited	Republic of Singapore	Investment holding	S$10,000	100%

VMore System Private Limited	Republic of Singapore	IoT Retailing	S$10,000	100%

VMore Holding Limited	New Zealand	Investment holding	NZ$10,000	100%

VMore Merchants Pte Ltd	Republic of Singapore	Merchants onboarding	S$1,000	100%

AIM System Pte Ltd	Republic of Singapore	System provider	S$1,000	100%

The Company and its subsidiaries are hereinafter referred to as (the “Company”).

NOTE－3 GOING CONCERN UNCERTAINTIES

The accompanying condensed consolidated financial statements have been prepared using the going concern basis of accounting, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

The COVID-19 pandemic and the effects arising from efforts to contain the outbreak have materially and adversely affected the Company's financial performance for the nine months ended December 31, 2020.

As of December 31, 2020, the Company suffered from an accumulated deficit of $139,876,857 and working capital deficit of $5,806,013. The continuation of the Company as a going concern through December 31, 2021 is dependent upon the continued financial support from its stockholders. Management believes the Company is currently pursuing additional financing for its operations. However, there is no assurance that the Company will be successful in securing sufficient funds to sustain the operations.

These and other factors raise substantial doubt about the Company’s ability to continue as a going concern. These consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets and liabilities that may result in the Company not being able to continue as a going concern.

NOBLE VICI GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED DECEMBER 31, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

NOTE－4 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The accompanying condensed consolidated financial statements reflect the application of certain significant accounting policies as described in this note and elsewhere in the accompanying condensed consolidated financial statements and notes.

Basis of presentation

These accompanying condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“US GAAP”).

Basis of consolidation

The condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All significant inter-company balances and transactions within the Company have been eliminated upon consolidation.

Use of estimates and assumptions

In preparing these condensed consolidated financial statements, management makes estimates and assumptions that affect the reported amounts of assets and liabilities in the balance sheet and revenues and expenses during the periods reported. Actual results may differ from these estimates.

Purchase deposits

Purchase deposits represent deposit payments made to vendors for procurement, which are interest-free, unsecured and relieved against accounts payable when goods are received by the Company, or refundable in the next twelve months.

Cash and cash equivalents

Cash and cash equivalents are carried at cost and represent cash on hand, demand deposits placed with banks or other financial institutions and all highly liquid investments with an original maturity of three months or less as of the purchase date of such investments.

NOBLE VICI GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED DECEMBER 31, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

Intangible assets

Intangible assets represented the acquired game right from a related party, which are stated at acquisition cost, less accumulated amortization. The Company amortizes its intangible assets with definite lives over their estimated useful lives and reviews these assets for impairment when an indicator for potential impairment exists. The Company is currently amortizing its intangible assets with definite lives over periods of 3 years.

Property, plant and equipment

Property, plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses, if any. Depreciation is calculated on the straight-line basis over the following expected useful lives from the date on which they become fully operational:

		Expected useful lives
Building		38 years or lesser than term of lease
Leasehold improvements		3 – 10 years or lesser than term of lease
Furniture and fittings		3 years
Office equipment and computers		1- 5 years
Motor vehicle		3 – 3.33 years

Expenditures for repairs and maintenance are expensed as incurred. When assets have been retired or sold, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in the results of operations.

Depreciation expense for the three months ended December 31, 2020 and 2019 were $71,101 and $49,011, as part of operating expenses, respectively.

Depreciation expense for the nine months ended December 31, 2020 and 2019 were $192,573 and $147,031, as part of operating expenses, respectively.

Impairment of long-lived assets

In accordance with Accounting Standards Codification ("ASC") Topic 360-10-5, “ Impairment or Disposal of Long-Lived Assets ”, the Company reviews its long-lived assets, including property, plant and equipment, as well as intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable or that useful lives are no longer appropriate. If the total of the expected undiscounted future net cash flows is less than the carrying amount of the asset, a loss is recognized for the difference between the fair value and carrying amount of the asset. There has been no impairment charge as of December 31, 2020.

NOBLE VICI GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED DECEMBER 31, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

Revenue recognition

The Company adopted Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”). Under ASU 2014-09, the Company applies the following five steps in order to determine the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its agreements:


·	identify the contract with a customer;
·	identify the performance obligations in the contract;
·	determine the transaction price;
·	allocate the transaction price to performance obligations in the contract; and
·	recognize revenue as the performance obligation is satisfied.

The Company accounts for a contract with a customer when the contract is committed in writing, the rights of the parties, including payment terms, are identified, the contract has commercial substance and consideration to collect is substantially probable.

The Company continues to derive its revenues from sales contracts with its customers with revenues being recognized upon delivery of products. Persuasive evidence of an arrangement is demonstrated via sales contract and invoice; and the sales price to the customer is fixed upon acceptance of the sales contract and there is no separate sales rebate, discount, or volume incentive. The Company recognizes revenue when title and ownership of the goods are transferred upon shipment to the customer by the Company to consider control of goods are transferred to its customer and collectability of payment is reasonably assured. The Company’s revenues are recognized at a point in time after all performance obligations are satisfied.

The Company records revenues from the sales of third-party products on a “gross” basis pursuant to ASC 605-45 Revenue Recognition - Principal Agent Considerations, when we are the primary obligor in the arrangement with the end customer and have the risks and rewards as principal in the transaction, such as responsibility for fulfillment, retaining the risk for collection, and establishing the price of the products. If these indicators have not been met, or if indicators of net revenue reporting specified in ASC 605-45 are present in the arrangement, revenue is recognized net of related direct costs.

Product sales are recorded net of good and service taxes and product returns.

Commission credits

The Company maintains a membership program, whereby certain members earn commission credits, based on the sales volume of certain other members who are sponsored directly or indirectly by the member. Commission credits are redeemable on future spending of the products purchased or playing online games. Commission credits are recorded and classified as operating expense when the products are delivered and revenue is recognized. The estimated liability for unredeemed commission credit is included in commission liability on the accompanying balance sheets. Management reviews the adequacy for the accrual for unredeemed commission credits by periodically evaluating the historical redemption and projected trends.

NOBLE VICI GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED DECEMBER 31, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

Deferred revenue and costs

Deferred revenue and deferred cost of goods sold result from transactions where the Company has shipped product for which all revenue recognition criteria under the five-step model have not yet been met. Though these contracts are not considered a contract under ASC 606, they are legally enforceable, and the Company has an unconditional and immediate right to payment after the Company has shipped products, therefore, the Company recognizes a receivable and a corresponding deferred revenue upon shipment. Deferred cost of goods sold includes direct inventory costs. Once all revenue recognition criteria under the five-step model have been met, the deferred revenues and associated cost of goods sold are recognized.

Income taxes

The Company adopted the ASC 740 Income tax provisions of paragraph 740-10-25-13, which addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the consolidated financial statements. Under paragraph 740-10-25-13, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the consolidated financial statements from such a position should be measured based on the largest benefit that has a greater than fifty percent (50%) likelihood of being realized upon ultimate settlement. Paragraph 740-10-25-13 also provides guidance on de-recognition, classification, interest and penalties on income taxes, accounting in interim periods and requires increased disclosures. The Company had no material adjustments to its liabilities for unrecognized income tax benefits according to the provisions of paragraph 740-10-25-13.

The estimated future tax effects of temporary differences between the tax basis of assets and liabilities are reported in the accompanying balance sheets, as well as tax credit carry-backs and carry-forwards. The Company periodically reviews the recoverability of deferred tax assets recorded on its balance sheets and provides valuation allowances as management deems necessary.

Uncertain tax positions

The Company did not take any uncertain tax positions and had no adjustments to its income tax liabilities or benefits pursuant to the ASC 740 provisions of Section 740-10-25 for the three and nine months ended December 31, 2020 and 2019.

Leases

The Company adopted Topic 842, Leases (“ASC 842”), using the modified retrospective approach through a cumulative-effect adjustment and utilizing the effective date of January 1, 2017 as its date of initial application.

The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, other current liabilities, and operating lease liabilities in our consolidated balance sheets. Finance leases are included in property and equipment, other current liabilities, and other long-term liabilities in our consolidated balance sheets.

NOBLE VICI GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED DECEMBER 31, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the Company’s leases do not provide an implicit rate, the Company generally use the incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. The lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

Foreign currencies translation

Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the consolidated statement of operations.

The reporting currency of the Company is United States Dollar ("US$") and the accompanying consolidated financial statements have been expressed in US$. In addition, the Company’s operating subsidiaries in Singapore and Seychelles maintain their books and record in its local currency, Singapore Dollars (“S$”), which is a functional currency as being the primary currency of the economic environment in which their operations are conducted. In general, for consolidation purposes, assets and liabilities of its subsidiaries whose functional currency is not US$ are translated into US$, in accordance with ASC Topic 830-30, “ Translation of Financial Statement”, using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the year. The gains and losses resulting from translation of financial statements of foreign subsidiaries are recorded as a separate component of accumulated other comprehensive income within the statements of changes in stockholder’s equity.

Translation of amounts from S$ into US$1 has been made at the following exchange rates for the nine months ended December 31, 2020 and 2019:

	December 31, 2020		December 31, 2019
Period-end S$:US$1 exchange rate		1.3221		1.3552
Period average S$:US$1 exchange rate		1.3324		1.3668

Comprehensive income

ASC Topic 220, “Comprehensive Income”, establishes standards for reporting and display of comprehensive income, its components and accumulated balances. Comprehensive income as defined includes all changes in equity during a period from non-owner sources. Accumulated other comprehensive income, as presented in the accompanying consolidated statements of changes in stockholders’ equity, consists of changes in unrealized gains and losses on foreign currency translation. This comprehensive income is not included in the computation of income tax expense or benefit.

NOBLE VICI GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED DECEMBER 31, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

Segment reporting

ASC Topic 280, “Segment Reporting” establishes standards for reporting information about operating segments on a basis consistent with the Company’s internal organization structure as well as information about geographical areas, business segments and major customers in consolidated financial statements. For the three and nine months ended December 31, 2020 and 2019, the Company operates in one reportable operating segment in Singapore and Asian Region.

Related parties

The Company follows the ASC 850-10, Related Party for the identification of related parties and disclosure of related party transactions.

Pursuant to section 850-10-20 the related parties include a) affiliates of the Company; b) entities for which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of section 825–10–15, to be accounted for by the equity method by the investing entity; c) trusts for the benefit of employees, such as pension and Income-sharing trusts that are managed by or under the trusteeship of management; d) principal owners of the Company; e) management of the Company; f) other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests; and g) other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests.

The consolidated financial statements shall include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business. However, disclosure of transactions that are eliminated in the preparation of consolidated or combined financial statements is not required in those statements. The disclosures shall include: a) the nature of the relationship(s) involved; b) a description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which income statements are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the consolidated financial statements; c) the dollar amounts of transactions for each of the periods for which income statements are presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and d) amount due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement.

Commitments and contingencies

The Company follows the ASC 450-20, Commitments to report accounting for contingencies. Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or un-asserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or un-asserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein.

NOBLE VICI GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED DECEMBER 31, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed.

Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. Management does not believe, based upon information available at this time that these matters will have a material adverse effect on the Company’s financial position, results of operations or cash flows. However, there is no assurance that such matters will not materially and adversely affect the Company’s business, financial position, and results of operations or cash flows.

Fair value of financial instruments

The Company follows paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and has adopted paragraph 820-10-35-37 of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 of the FASB Accounting Standards Codification establishes a framework for measuring fair value in generally accepted accounting principles (GAAP), and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, paragraph 820-10-35-37 of the FASB Accounting Standards Codification establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by paragraph 820-10-35-37 of the FASB Accounting Standards Codification are described below:

Level 1		Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.

Level 2		Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.

Level 3		Pricing inputs that are generally observable inputs and not corroborated by market data.

Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable.

The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument.

The carrying amounts of the Company’s financial assets and liabilities, such as cash and cash equivalents, approximate their fair values because of the short maturity of these instruments.

NOBLE VICI GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED DECEMBER 31, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

Recent accounting pronouncements

The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and do not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations.

NOTE－5 INTANGIBLE ASSETS

	December 31, 2020			March 31, 2020
					(Audited)
Gaming right and software
Gross carrying value	$	7,034		$	6,533
Less: accumulated amortization		(2,150	)		(363	)

Intangible assets, net	$	4,884		$	6,170

Amortization expense for the three months ended December 31, 2020 and 2019 were $611 and $69,007, as part of operating expenses, respectively.

Amortization expense for the nine months ended December 31, 2020 and 2019 were $1,746 and $206,390, as part of operating expenses, respectively.

The following table outlines the annual amortization expense for the next three years:

Years ending December 31:
2021	$	2,345
2022		2,345
2023		194

Total	$	4,884

NOTE－6 AMOUNT DUE TO A DIRECTOR

As of December 31, 2020, amount due to a director of the Company, Mr. TANG Wai Chong Eldee, which was unsecured, interest-free and had no fixed terms of repayment. Imputed interest from related party loan is not significant.

NOBLE VICI GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED DECEMBER 31, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

NOTE－7 AMOUNT DUE TO A RELATED PARTY

As of December 31, 2020, the Company owed the amount of $280,317 due to the former shareholder of the Company, Miss Kao. The balance is unsecured, interest-free and has no fixed terms of repayment. Imputed interest from related parties’ loan is not significant.

NOTE－8 BORROWINGS

	As of
	December 31, 2020		March 31, 2020
			(Audited)
Current portion
Loan	$	291,557	$	220,283
Lease liabilities		71,788		36,475
		363,345		256,758

Non-current portion
Loan		1,601,089		1,652,120
Lease liabilities		70,971		40,365
		1,672,060		1,692,485

	$	2,035,405	$	1,949,243

The loan is secured by a mortgage over leasehold building. The loan bears interest rate of 3.75% flat per annum and is repayable in 120 equal month installments commencing from October 1, 2018. The loan is personally guaranteed by the director of the Company, Eldee Tang.

The Company has financed its motor vehicles, office premises and office equipment under finance lease agreements with the fixed interest rate ranging from 2.80% to 7.98% per annum, due through 2020 and 2026, with principal and interest payable monthly. These leases have remaining lease terms of 12 months to 93 months.

NOBLE VICI GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED DECEMBER 31, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

Right of use assets are included in the condensed consolidated balance sheet are as follows:

	As of
	December 31, 2020		March 31, 2020
			(Audited)
Non-Current assets
Right-of-use assets, net of amortization (included in property, plant and equipment)	$	202,992	$	95,368

The maturities of lease liabilities and loan are as follows:

	Lease liabilities			Loan
Years ending December 31:
2021	$	80,620		$	380,506
2022		49,979			326,147
2023		18,771			326,147
2024		8,172			326,147
2025		4,965			326,147
Thereafter		798			896,910

Total lease payments		163,305			2,582,004
Less: Imputed interest		(20,546	)		(689,358	)
Present value of lease liabilities	$	142,759		$	1,892,646

NOTE－9 INCOME TAX

The Company generated an operating loss for the nine months ended December 31, 2020 and 2019 and did not record income tax expense. The Company has operations in various countries and is subject to tax in the jurisdictions in which they operate, as follows:

United States of America

NVGI is registered in the State of Delaware and is subject to United States of America tax law. No provision for income taxes have been made as NVGI has generated no taxable income for the periods presented. The Company’s policy is to recognize accrued interest and penalties related to unrecognized tax benefits in its income tax provision. The Company has not accrued or paid interest or penalties which were not material to its results of operations for the period presented.

NOBLE VICI GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED DECEMBER 31, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

As of December 31, 2020, the Company incurred $1,856,790 of cumulative net operating losses which can be carried forward to offset future taxable income. The net operating loss carryforwards begin to expire in 2039, if unutilized. The Company has provided for a full valuation allowance against the deferred tax assets of $389,926 on the expected future tax benefits from the net operating loss carryforwards as the management believes it is more likely than not that these assets will not be realized in the future.

Republic of Singapore

The Company’s operating subsidiaries are registered in Republic of Singapore and are subject to the Singapore corporate income tax at a standard income tax rate of 17% on the assessable income arising in Singapore during its tax year.

The Company’s subsidiary in Republic of Seychelles is also subject to the Singapore corporate income tax regime.

The reconciliation of income tax rate to the effective income tax rate based on income before income taxes for the nine months ended December 31, 2020 and 2019 are as follows:

	Nine months ended December 31,
	2020			2019

(Loss) income before income taxes	$	(1,626,709	)	$	2,620,467
Statutory income tax rate		17%			17%
Income tax (credit) expense at statutory rate		(276,540	)		445,479
Tax effect of non-deductible expenses (non-taxable income)		3,965			(464,034	)
Tax loss not recognized as deferred tax		372,500			–
Income tax expense (credit)	$	99,925		$	(18,555	)

NOTE－10 RELATED PARTY TRANSACTIONS

From time to time, the stockholder and director of the Company advanced funds to the Company for working capital purpose. Those advances are unsecured, non-interest bearing and due on demand. The imputed interest on the loan from a related party was not significant.

Royalty charges and marketing expenses paid to a related company totaled $6,658 and $83,651, for the three months ended December 31, 2020 and 2019.

NOBLE VICI GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED DECEMBER 31, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

Royalty charges and marketing expenses paid to a related company totaled $13,461 and $421,972, for the nine months ended December 31, 2020 and 2019.

Apart from the transactions and balances detailed elsewhere in these accompanying consolidated financial statements, the Company has no other significant or material related party transactions during the periods presented.

NOTE－11 CONCENTRATIONS OF RISK

The Company is exposed to the following concentrations of risk:

(a) Major customers

For the three and nine months ended December 31, 2020 and 2019, there is no individual customer exceeding 10% of the Company’s revenue.

The Company considers its business activities to constitute one single reportable segment. The Company’s chief operating decision makers use consolidated results to make operating and strategic decisions. The geographic distribution analysis of the Company’s revenues by region is as follows:

	Three months ended December 31,
	2020		2019

China	$	–	$	9,011
Singapore		139,562		1,928,059
Malaysia		4,318		22,171
Philippines		671		131
Thailand		1,993		5,039
United States		84		–
Indonesia		1,985		14,986
Other countries in Asia Pacific		787		84,540

	$	149,400	$	2,063,937

NOBLE VICI GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED DECEMBER 31, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

	Nine months ended December 31,
	2020		2019

China	$	–	$	225,641
Singapore		362,789		7,399,810
Malaysia		13,545		3,669,216
Philippines		2,112		1,646,733
Thailand		5,358		802,893
United States		1,179		–
Indonesia		6,604		412,002
Other countries in Asia Pacific		7,888		518,526

	$	399,475	$	14,674,821

All of the Company’s long-lived assets are located in Singapore.

(b) Major vendors

For the three and nine months ended December 31, 2020, there are no vendors representing more than 10% of the Company’s purchase.

For the three months ended December 31, 2019, there is one single vendor representing more than 10% of the Company’s purchase. This vendor (Vendor A) accounted for 24% of the Company’s purchase amounting to $544,751 with $355,913 of accounts payable. For the nine months ended December 31, 2019, there is one single vendor representing more than 10% of the Company’s purchase. This vendor (Vendor A) accounted for 19% of the Company’s purchase amounting to $1,580,300 with $355,913 of accounts payable.

(c)

Interest rate risk

As the Company has no significant interest-bearing assets, the Company’s income and operating cash flows are substantially independent of changes in market interest rates.

The Company’s interest-rate risk arises from borrowings under finance lease. The Company manages interest rate risk by varying the issuance and maturity dates variable rate debt, limiting the amount of variable rate debt, and continually monitoring the effects of market changes in interest rates. As of December 31, 2020, borrowing under finance lease was at fixed rates.

NOBLE VICI GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED DECEMBER 31, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

(d)

Economic and political risk

The Company’s major operations are conducted in Republic of Singapore. Accordingly, the political, economic, and legal environments in Singapore, as well as the general state of Singapore’s economy may influence the Company’s business, financial condition, and results of operations.

(e)

Exchange rate risk

The Company cannot guarantee that the current exchange rate will remain steady; therefore there is a possibility that the Company could post the same amount of profit for two comparable periods and because of the fluctuating exchange rate actually post higher or lower profit depending on exchange rate of S$ converted to US$ on that date. The exchange rate could fluctuate depending on changes in political and economic environments without notice.

NOTE－12 COMMITMENTS AND CONTINGENCIES

(a)

Capital commitment

As of December 31, 2020, the Company has no material capital commitments in the next twelve months.

(b)

Legal proceeding

In April 2020, the Company received invoices from each of the Public Company Accounting Oversight Board (“PCAOB”) and the Financial Accounting Standards Board (“FASB”) in the amounts of $702,600 and $92,100, respectively, for our share of the PCAOB and FASB Issuer Accounting Support Fee for calendar year 2020. The fees were due May 18, 2020. The Company has petitioned the PCAOB and FASB to review its fee assessments and is in the process of review. The Company believes that there is a material likelihood that it will not prevail, and that it will be required to pay all assessed fees.

In accordance with applicable accounting guidance, the Company records accruals for certain of its outstanding legal proceedings, investigations or claims when it is probable that a liability will be incurred, and the amount of loss can be reasonably estimated. The Company evaluates, on a quarterly basis, developments in legal proceedings, investigations or claims that could affect the amount of any accrual, as well as any developments that would make a loss contingency both probable and reasonably estimable. The Company discloses the amount of the accrual if the financial statements would be otherwise misleading.

When a loss contingency is not both probable and estimable, the Company does not establish an accrued liability. However, if the loss (or an additional loss in excess of the accrual) is at least a reasonable possibility and material, then the Company discloses an estimate of the possible loss or range of loss, if such estimate can be made or discloses that an estimate cannot be made.

NOBLE VICI GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED DECEMBER 31, 2020 AND 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

The assessments whether a loss is probable or a reasonable possibility, and whether the loss or a range of loss is estimable, often involve a series of complex judgments about future events. Management is often unable to estimate a range of reasonably possible loss, particularly where (i) the damages sought are substantial or indeterminate, (ii) the proceedings are in the early stages, or (iii) the matters involve novel or unsettled legal theories or a large number of parties. In such cases, there is considerable uncertainty regarding the timing or ultimate resolution of such matters, including a possible eventual loss, fine, penalty or business impact, if any.

The Company expects that the aggregate range of reasonably possible losses for such legal proceeding is likely to range from approximately $800,000 and upwards if penalties or interest are assessed against us in the event that the Company is unable to timely pay assessed amounts. It is probable that $800,000 will be payable by March 31, 2021. The estimated aggregate range of reasonably possible losses is based upon currently available information for those proceedings in which the Company is involved, taking into account the Company’s best estimate of such losses for those cases for which such estimate can be made. Those matters for which an estimate is not possible are not included within this estimated range. Therefore, such range represents what the Company believes to be an estimate of possible loss only for those matters meeting such criteria. It does not represent the Company’s maximum loss exposure.

Except as set forth above, there are no material pending legal proceedings to which the Company or its subsidiaries are a party or to which any of its or their property is subject, nor are there any such proceedings known to be contemplated by governmental authorities. None of the Company’s directors, officers, affiliates or any owner of record or beneficially of more than 5% of our common stock, or any associate of any of the foregoing, is involved in a proceeding adverse to its business or has a material interest adverse to its business.

NOTE－13 SUBSEQUENT EVENTS

In accordance with ASC Topic 855, “Subsequent Events”, which establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before consolidated financial statements are issued, the Company has evaluated all events or transactions that occurred after December 31, 2020, up through the date the Company issued the unaudited condensed consolidated financial statements. During the period, the Company did not have any material recognizable subsequent events.

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

Overview

We were incorporated under the laws of the State of Delaware on July 6, 2010 under the name “Advanced Ventures Corp.” Effective January 6, 2014, we changed our name to “Gold Union Inc.” Effective March 26, 2018, we changed our name to Noble Vici Group, Inc. and our trading symbol was changed to NVGI. On August 8, 2018, we consummated the acquisition of Noble Vici Private Limited, a corporation organized under the laws of Singapore (“NVPL”), which was wholly owned by Eldee Tang, our sole director and Chief Executive Officer. NVPL is engaged in the IoT, Big Data, Blockchain and E-commerce business. As a result of our acquisition of NVPL, we entered into the IoT, Big Data, Blockchain and E-commerce business. We are headquartered in Singapore and operate a branch office in Taiwan. Certain of our resellers are operating “V-More” branded satellite offices in Shenzhen, China.

History

As Advanced Ventures Corp., we acquired a patent (U.S. Patent Number: 6,743,209) (the “Patent”), for a catheter with a integral anchoring mechanism. During the second fiscal quarter of 2014, we elected to discontinue our business of exploiting the Patent and began to consider other business opportunities that may bring quicker and greater value to our stockholders. We initially considered entering into the business of trading precious metal bullion primarily in the Asia Pacific region. Therefore, effective January 6, 2014, we changed our name to “Gold Union Inc.” to more adequately reflect our initial intended business operations.

Effective March 7, 2012, we increased the number of our authorized shares of common stock to three billion shares (3,000,000,000) and engaged in a forward stock split of its common shares whereby each one share of our common stock was split into fifteen shares of our common stock.

On December 31, 2015, we consummated a Share Exchange Agreement with G.U. International Limited, a limited company incorporated under the laws of the Republic of Seychelles and our wholly owned subsidiary (“GUI”), and Kao Wei-Chen, an individual representing herself and 8 other individuals (collectively, the “Golden Corridor Shareholders”), which agreement was amended several times to extend the closing date of the acquisition (collectively, the “Share Exchange Agreement”). Pursuant to the Share Exchange Agreement, we, through GUI, purchased 480 shares of Phnom Penh Golden Corridor Trading Co. Limited (the “GC Shares”), from 9 private Golden Corridor Shareholders, representing 48% of the issued and outstanding shares of common stock of Golden Corridor. As consideration, we issued to the Golden Corridor Shareholders 2,500,000,000 shares of our common stock, at a value of US $0.002 per share, for an aggregate value of US $5,000,000.

As a result of our acquisition of the GC Shares, we ceased our metal bullion trading business and entered into the real estate development and rental business located in the Kingdom of Cambodia. Golden Corridor owns three parcels of land located at National Road 44, Phum Phkung, Chbarmorn Commune, Chbarmorn District, Kampong Speu Province, Kingdom of Cambodia, measuring an aggregate of 172,510 square meters (collectively, the “Properties”). We intended to develop the Properties into an industrial park for rental income.

Due to difficulties in entering the real estate development and rental business, on February 2, 2018, we engaged in a corporate reorganization and distributed the GC Shares to our shareholders. On March 18, 2018, our subsidiary, G.U. Asia Limited was dissolved.

Change in Control

On January 29, 2018, Eldee Tang entered into Share Sale Agreements with four shareholders and former affiliates of the Company to purchase up to 1,675,000,000 shares of the Company’s common stock at a per share purchase price of US$0.00008, for an aggregate price of US$134,000. On June 15, 2018, the Company effectuated a 1 for 1,000 reverse stock split whereby every 1,000 shares of the Company’s common stock were reduced to one share. The parties effectuated Mr. Tang’s purchase of 750,000 shares such securities (expressed on a post reverse split basis) effective June 15, 2018. Mr. Tang hopes to purchase the balance of the 925,000 shares from Kao Wei-Chen, a former affiliate of the Company, in the near future. The foregoing description of the Share Sale Agreement with Kao Wei-Chen is qualified in its entirety by reference to such agreement which is filed as Exhibit 10.2 to this Quarterly Report and is incorporated herein by reference.

In connection with the contemplated change in control, on March 27, 2018, Lim Yew Chuan, the director, Chief Executive Officer, Chief Financial Officer and Secretary of Noble Vici Group, Inc. (the “Company”), resigned from all of his positions as director, Chief Executive Officer, Chief Financial Officer and Secretary of the Company. Concurrently, Eldee Tang was appointed to serve as the Chief Executive Officer and Director of the Company, together with other members of the new management team.

Effective June 15, 2018, we:

	1.	Increased the Company’s authorized capital from 3,000,000,000 shares of common stock, par value $0.0001 (the “Common Stock”), to 3,050,000,000 shares, consisting of 3,000,000,000 shares of Common Stock and 50,000,000 shares of undesignated preferred stock, par value $0.0001 (the “Preferred Stock”);
	2.	Effected a 1-for-1000 reverse stock split of our issued and outstanding Common Stock (the “Reverse Stock Split”);
	3.	Elected not to be governed by Section 203 of the Delaware General Corporation Law;
	4.	Changed the Company’s fiscal year end from December 31st to March 31st, for all purposes (including tax and financial accounting);
	5.	Adopted Amended and Restated Certificate of Incorporation for the purpose of consolidating the amendments to the Company’s Certificate of Incorporation; and
	6.	Adopted the Amended and Restated Bylaws of the Company.

Acquisition of NVPL, TDA and NDA

On August 8, 2018, we consummated the acquisition of Noble Vici Private Limited, a corporation organized under the laws of Singapore (“NVPL”), in accordance with the terms of a Share Exchange Agreement. NVPL is wholly owned by Eldee Tang, our Chief Executive Officer and Director. Pursuant to the Share Exchange Agreement, we purchased One Million and One (1,000,001) shares of NVPL (the “NVPL Shares”), representing all of the issued and outstanding shares of common stock of NVPL, in consideration of One Hundred Forty Million (140,000,000) shares of our common stock, at a value of US $1.70 per share, for an aggregate value of US $238,000,000. It is our understanding that Mr. Tang is not a U.S. Person within the meaning of Regulations S. Accordingly, the Shares are being sold pursuant to the exemption provided by Section 4(a)(2) of the Securities Act of 1933, as amended, Regulation D and Regulation S promulgated thereunder. As a result of our acquisition of NVPL, we entered into the IoT, Big Data, Blockchain and E-commerce business.

On September 17, 2018, we consummated the acquisition of a 51% controlling interest in The Digital Agency Private Limited, a private limited company organized under the laws of Singapore (“TDA”), and a start-up digital marketing company, in accordance with the terms of that certain Share Exchange Agreement by and among the Company, NIApplications Private Limited (formerly, “Noble Infotech Applications Private Limited”), a private limited company organized under the laws of Singapore and our wholly owned subsidiary (“NIA”), TDA and Mok Jo Han (“the “TDA Share Exchange Agreement”). Pursuant to the terms of the TDA Share Exchange Agreement, we acquired 51 ordinary shares of TDA, representing approximately fifty-one percent (51%) of the issued and outstanding ordinary shares of TDA, in exchange for 510,000 shares of common stock of the Company, par value $0.0001 (the “TDA Shares”), representing an exchange ratio of ONE (1) ordinary share of TDA for Ten Thousand (10,000) shares of common stock of the Company, at a valuation of $2.00 per share of the Company, for an aggregate value of $1,020,000. It is our understanding that Mr. Mok is not a U.S. Person within the meaning of Regulations S. The TDA Shares were sold pursuant to the exemption provided by Section 4(a)(2) of the Securities Act of 1933, as amended, and Regulation S promulgated thereunder.

On September 17, 2018, we consummated the acquisition of a 51% controlling interest in Noble Digital Apps Sendirian Berhad, a private limited company organized under the laws of Malaysia (“NDA”), and a start-up digital apps and big data company in accordance with the terms of that certain Share Exchange Agreement by and among the Company, NIA, NDA, Cheng Bok Woon, Tan Yew Fui, and Yong Swee Sun (“the “NDA Share Exchange Agreement”). Pursuant to the terms of the NDA Share Exchange Agreement, we acquired 510 ordinary shares of NDA, representing approximately fifty-one percent (51%) of the issued and outstanding ordinary shares of NDA, in exchange for 510,000 shares of common stock of the Company, par value $0.0001 (the “NDA Shares”), representing an exchange ratio of ONE (1) ordinary share of NDA for One Thousand (1,000) shares of common stock of the Company, at a valuation of $2.00 per share of the Company, for an aggregate value of $1,020,000. It is our understanding that Mr. Cheng, Mr. Tan and Mr. Yong are not U.S. Person within the meaning of Regulations S. The NDA Shares were sold pursuant to the exemption provided by Section 4(a)(2) of the Securities Act of 1933, as amended, and Regulation S promulgated thereunder.

Issuance of shares to sales affiliates

On September 17, 2018, and September 25, 2018, we approved the issuance of Nine Million One Hundred Thirty Five Thousand Seven Hundred Ninety Four (9,135,794) shares and Five Hundred Sixty Seven Thousand Sixty-Four (567,064) shares of our common stock, par value $0.0001, respectively, representing a total of approximately 6.3% of our issued and outstanding common stock, at a per share price of One Dollars and Ninety Nine Cents (US $1.99), to approximately 460 sales associates for prior sales and marketing services provided to us and our subsidiaries and affiliates. As a condition of receipt of such securities, each recipient executed a Stockholder Representation Letters, which contained, among other things, restrictions prohibiting the transfer of such securities for a minimum period of 18 months up to a maximum period of 66 months after the execution of such letter. For ease of administration, the recipients appointed Noble Infotech Limited (“NIL”) as nominee to hold, manage, administer and effectuate the distribution of such securities upon the expiration of the applicable restricted periods. The shares were issued on October 18, 2018 to NIL. The securities were issued pursuant to the exemption provided by Regulation S promulgated under the Securities Act of 1933, as amended. The foregoing description of the Stockholder Representation Letters are qualified in its entirety by reference to such agreements which are filed as Exhibit 10.3 to this Quarterly Report and are incorporated herein by reference.

On December 3, 2018, we approved the issuance of up to an aggregate of Ten Million Eight Hundred Thirty Eight Thousand One Hundred Forty One (10,838,141) shares of our common stock, par value $0.0001, representing approximately 7.1% of our issued and outstanding common stock, at a per share price of Two Dollars (US $2.00), to about 690 sales associates for prior sales and marketing services provided to us and our subsidiaries and affiliates. As a condition of receipt of such securities, each recipient was required to execute one of two standard forms of Stockholder Representation Letters, which contained, among other things, restrictions prohibiting the transfer of such securities for a minimum period of 18 or 24 months up to a maximum period of 72 months after the execution of such letter. For ease of administration, the recipients appointed Venvici Partners Limited (“VVP”) as nominee to hold, manage, administer and effectuate the distribution of such securities upon the expiration of the applicable restricted periods. The shares were issued on January 4, 2019 to VVP. The securities were issued pursuant to the exemption provided Regulation S promulgated under the Securities Act of 1933, as amended. The foregoing description of the Stockholder Representation Letters and the appointment of VVP as trustee are qualified in its entirety by reference to such agreements which are filed as Exhibits 10.4 and 10.5 to this Quarterly Report and are incorporated herein by reference.

On March 11, 2019, our Board of Directors, approved the issuance of up to an aggregate of Fifteen Million (15,000,000) shares of our common stock, par value $0.0001, representing approximately 8.4% of our issued and outstanding common stock (collectively, the “Shares”), at a per share price of Two Dollars (US $2.00), to about 700 sales associates for prior sales and marketing services provided to us and our subsidiaries and affiliates. As a condition of receipt of such securities, each recipient was required to execute one of two standard forms of Stockholder Representation Letters, which contained, among other things, restrictions prohibiting the transfer of such securities for a minimum period of 18 months up to a maximum period of 66 months after the execution of such letter. For ease of administration, the recipients appointed Venvici Partners Limited (“VVP”) as nominee to hold, manage, administer and effectuate the distribution of the Shares upon the expiration of the applicable restricted periods. For so long as VVP is the stockholder of record of the Shares, VVP shall serve as the attorney in fact to vote such Shares at any annual, special or other meeting of the stockholders of the Company, and at any adjournment or adjournments thereof, or pursuant to any consent in lieu of a meeting or otherwise, with respect to any matter that may be submitted for a vote of stockholders of the Company. The securities will be issued pursuant to the exemption provided by Regulation S promulgated under the Securities Act of 1933, as amended. The foregoing description of the Stockholder Representation Letters and the appointment of VVP as trustee are qualified in its entirety by reference to such agreements which are filed as Exhibits 10.6 and 10.7 to this Quarterly Report and are incorporated herein by reference.

V-More Merchant Acquisition Agreements

On March 19, 2019, we entered into a V-More Merchant Acquisition Agreement with each of the Consultants pursuant to which each Consultant agreed to provide certain services related to the identification, due diligence, acquisition and retention of potential merchants in certain designated territories for inclusion in our V-More platform. As consideration for these services, each Consultant received up to an aggregate of Fourteen Million Three Hundred Twenty Thousand (14,320,000) shares of our common stock, for an aggregate of up to Forty-Two Million Nine Hundred Sixty Thousand (42,960,000) shares of our common stock, subject to the achievement of certain performance milestones and certain clawback rights. We registered Twenty-One Million Four Hundred Eighty Thousand (21,480,000) shares of the amount of shares issuable under the V-More Merchant Acquisition Agreement on a Registration Statement on Form S-8 filed with the Securities and Exchange Commission on March 19, 2019. The foregoing description of the V-More Merchant Acquisition Agreements is qualified in its entirety by reference to the V-More Merchant Acquisition Agreements dated March 19, 2019, which are filed as Exhibits 10.8, 10.9 and 10.10 to this Quarterly Report and incorporated herein by reference.

Consulting Agreement

During the period from March 19, 2019 till December 31, 2019, one of V-More’s merchants and vendors, Fame Reserve Limited, a subcontractor of Ms. Sukullayanee Suwunnavid (the “Digital Consultant”), which distributes digital vouchers, ran a promotion through V-More platform to promote and sell their digital vouchers (the “Promotion”). As a consideration for purchasing these vouchers for the promotion, the Board approved the issuance of up to an aggregate of Ten Million (10,000,000) shares of our common stock, par value $0.0001, of our issued and outstanding common stock, at a per share price of Two Dollars (US$2.00).

In connection to the Promotion, we entered into a Consulting Agreement with pursuant to which the Digital Consultant agreed to supply certain digital offerings and services to our customers, including without limitation, order fulfilment services with respect to orders from our customers received through the Digital Consultant’s online platform and its related digital offerings. We issued Ten Million (10,000,000) shares of the Corporation’s Common Stock, par value $0.0001 (the “Shares”), at a per share price of US$2.00, as payment in full for the Services and the satisfaction of all of our obligations to the Digital Consultant with respect to such services. These securities were registered on a Registration Statement on Form S-8 filed with the Securities and Exchange Commission on March 19, 2019. The foregoing description of the Consulting Agreement is qualified in its entirety by reference to the V-Consulting Agreement dated March 19, 2019, which is filed as Exhibit 10.11 to this Quarterly Report and incorporated herein by reference.

Our current corporate structure is as below:

Our Operations and Future Plans

Ecommerce Platform

We are focused on providing users with innovative tools to live and interact in the modern mobile world through our ecosystem of IoT, Big Data, Blockchain and E-commerce products and services. We integrate blockchain technology with our E-commerce platform to connect consumers and merchants in a dynamic global marketplace via blockchain transactions. We onboard users, consumers and referrers through our Affiliate Incentivized Marketing to Advertising Dollar Sharing (formerly known as Affiliate Incentivized Marketing (AIM)) model while merchants are onboarded via our Merchant Incentivized Marketing (MIM) model. Some products and services offered in our ecosystem include procurement of discounted goods and services, referral reward system, mobile games and digital marketing, financial markets apps and a “Business Centre” within the same app. Our E-commerce platform not only offers users the ability to make online purchases, but also the convenience of an O2O (Online to Offline) platform whereby consumers can transact at a discount online while goods and services are distributed at a physical location. This drives traffic to the already weakened retail industry. The Business Centre within our ecosystem is offered through a mobile app and allows users to create their own referral platform within our ecosystem.

Advertising Dollar Sharing (ADS)

We have rebranded our Affiliate Incentivized Marketing to Advertising Dollar Sharing. Similar to the AIM model, the ADS business model also involves driving online and physical traffic and increasing sales and marketing of targeted products and services. Its enhanced function includes distribution of advertising dollars via ADS system to agencies, affiliate marketers, advertiser, users and referrals.

Sale and Distribution of IoT Smart Devices / VMore System Private Limited

In addition to the E-commerce platform, we intend to focus on the sales and distribution of IoT smart devices and appliances. In September, 2019, we began to sell our first IoT appliance, our smart coffee dispensing machines (the V-More Express (“VX”)). We hope to begin distributing the machines on or about the second calendar quarter of 2020 and expect them to be progressively placed into operation in Singapore on or around the third quarter of 2020. We expect to derive income from sales of our VX IoT hardware, the core consumables in VX and the advertising services we provide to our customers in connection with the VX.

Features of the VX; Revenue Sources:

Machine Capacity: The VX offers 9 types of beverage, holds 60 litres of distilled water tank and is able to produce 400 cups of beverages. VX currently offers barista-grade coffee in 9 different varieties in both hot and ice options. VX can be modified to allow for other offerings to be sold. We expect to adopt regional pricing for core products sales, aligning to each specific market’s demand and supply.

AdTech: In addition to sales of core products, we expect to rely on advertisements placed through the VX to drive revenue. We intend to seek advertisers that are proximate to each specific VX to display their advertisements through our smart machine. We believe that the use of local advertisements (Proximate Location Ads, or PLA) will drive relevant traffic to nearby physical merchants as well as online merchants. Advertisements can be static or dynamic and may be interactive, allowing user interaction. We expect to provide services to advertisers to assist them in creating and placing effective ads in the VX.

Smart Technology: The VX features a 42 inch touch screen with Smart Digital Panel Advertising Technology (“SDPAT”) that allows users to interact with advertisements via its interactive touch screen. Through the VX, we hope to capture users’ spending behaviour, advertisement interactions and other quantitative data, while developing our Big Data analytics. Data from our machines can be integrated with our ecommerce platform to facilitate the offering of discounts, rewards or other products and services across our e-commerce platform. We believe that additional data will allow us to: (i) deliver and improve our offerings and services of our online VMore E-commerce platform; (ii) improve synergy with offline merchants; (iii) improve the efficacy of our advertising services; and (iv) improve sales of products offered by the VX.

VX Operations

Our VX business operations are segregated into the following core functions to address the needs of our advertisers, VX IoT hardware purchasers and consumers.

Sales and Marketing Team. Our team will focus on the sale of the VX IoT hardware. Its targeted industries are primarily from real estate and property owners such as commercial offices, retails and buildings, where the VX will be installed. In addition to the sale of VX, the team will also create brand awareness of the VX and its core offerings in the VX.

Advertiser Onboarding Team. Once an advertiser engages us online to have its advertisement placed in VX, a member of our advertiser onboarding team will initiate the first of several communications with the merchant to introduce the advertiser to the technology involved in our PLA ecosystem. Before the advertisement goes live on the VX, the team will work with the advertiser to build and create the advertisement. We will provide tools such as an app to ensure the advertisement traffic monitoring and management are aligned. All advertisements will be proximate locality based, ensuring relevance for targeted traffic to be driven.

Operation and Maintenance Team(O&M). Once the VX are deployed, O&M team will monitor the performance of each VX deployed for its ingredients supply, hardware status and data collection efficiency. Maintenance of the hardware for performance to prevent downtime and refilling the ingredients into the VX will be undertaken by the O&M team.

Customer/User Service Representatives. Our customer service representatives will be reachable via the app or email 24 hours a day, seven days a week. The customer service team will also work with our technology team to improve the experience of VX owners, consumers and advertisers on the mobile application based on their feedback.

Technology. We employ technology to improve the experience we offer to VX owners, users and advertisers, increase the rate at which our users use our V-More Pro platform and enhance the efficiency of our business operations. A component of our strategy is to continue developing and refining our technology. With the future use of blockchain technology for recording and collecting data, we believe the security of transactional records will be increased, protecting the accuracy of data held by VX owners, advertisers and users. We believe that basing transactional data on a private blockchain network will facilitate a smoother and faster transaction completion.

We expect to use an algorithm to analyze data collected through our VX ecosystem. As the volume of transactions grow organically through increased deployment of VXs, we expect to increase the amount of data that we can collect and analyze. We believe that such data will allow us to continue to improve the experience of our VX owners, advertisers and consumers which, in turn, will help us improve the way the ecosystem flows.

Cybersecurity. We have integrated our technology with encryption algorithm “SHA3-256” & RSA Public/Private-Key, which is designed to withstand timing attacks. It also accepts any 32-byte string as a valid public key and does not require validation. We believe that the security of transaction records within our current system is adequate.

Advertising Dollar Sharing (ADS). We believe our ADS model will allow users and advertisers to benefit from reduced costs to consumers and higher traffic for advertisers. We expect users to benefit from discounts and advertising dollar rebates offered through our PLA ecosystem from online and offline merchants, referrals, and internal marketing efforts, with advertisers benefitting from increased retail sales volume offline or online.

Core Product/User Scale. We hope to include other products from mass market merchants, such as food and other beverages, as part of our product and service offerings. We believe that outreach to the mass market will be more effective to drive traffic for the advertisers/merchants where simple to complex transactions can be achieved through adoption of an incentivized model.

Brand. A substantial portion of our VX owners, advertisers and users are acquired through agencies, word-of-mouth & social network/platforms. We believe that relying on the referral process, in turn, will improve the quality of our user base, advertisers and VX owners as well as brand awareness. We expect that higher confidence in our brand will facilitate acquiring more users, advertisers and VX owners for our ecosystem.

We operate our IoT Smart Device business through VMore System Private Limited (“VMSPL”), our wholly owned subsidiary. VMSPL was incorporated in Singapore on July 22, 2019, and operates with our subsidiary AIM System Private Limited (“ASPL”), a Singapore private limited corporation incorporated on April 1, 2019, as described below:

VMSPL – engages in sales and marketing of VX and barista grade coffee to owners and consumers, operates and maintains the VX including support, both technical and non-technical;

ASPL – engages in VX software technology integration; Proximate Location Ads (“PLA”) activities such as advertisement sales, build, create and deploy its proprietary software technology (“PropST”); distribute advertising dollars via an Advertising Dollar Sharing (“ADS”) system to agencies, affiliate marketers, advertisers, users and referrals; provide technical and non-technical support in relation to PLA; and engages in brand management, marketing, promotions and media engagement activities.

VX vendor

We expect to rely on Barista Uno Private Limited (“BUPL”) to provide VMSPL with VX IoT hardware and coffee sourcing, distribution, and logistical upstream and downstream fulfilment services. Eldee Tang, our Chief Executive Officer and Director owns 31% of BUPL.

Trends, Markets and Regions

Advertisement Spending

*It is estimated that advertising spending worldwide will surpass 560 billion U.S. dollars in 2019, representing a growth of roughly four percent compared with the previous year. North America is expected to remain the largest regional ad market, closely followed by Asia Pacific. Western Europe ranks third, with ad spends amounting to approximately half of these of North America. (*Source: https://www.statista.com/statistics/ 236943/global-advertising-spending/) **Meanwhile, digital advertising spending worldwide – which includes both desktop and laptop computers as well as mobile devices – stood at an estimate at 194.6 billion U.S. dollars in 2016. This figure is forecast to constantly increase in the coming years, reaching a total of 335 billion U.S. dollars by 2020. (**Source: https://www.statista.com/statistics/237974/online-advertising-spending-worldwide/)

In addition to the advertising spending study, we examined various consumer models such as cashback models for direct compensation to affiliate marketing (e.g., https://www.shopback.sg), discounted coupons sales model (e.g. https://www.groupon.com) and incentivized reward model (e.g. https://www.dollarshaveclub.com).

We believe that advertising spending, including digital advertising spending will continue to increase in the near future. We intend to innovate the way advertisement is used in the marketplace through digital advertisements and effective channeling relevant traffic.

Market and Region: Bank and Unbanked in Southeast Asia

*With a population of 570 million and a booming GDP expected to reach $4.7 trillion by 2025, the six largest countries in Southeast Asia represent one of the world’s largest and fastest-growing regions. Within the region, we believe that the financial services industry holds tremendous if fundamental underlying challenges are addressed. For example, cash is still the primary means of transaction. More than 70% of the adult population is either “underbanked” or “unbanked,” with limited access to financial services. (*Source: https://www.bain.com/insights/fufilling-its-promise/)

*Currently, only 50% of adults in ASEAN have an account at a financial institution. ASEAN is discussing a specific financial inclusion target for 2020. There is a consensus to set the target at around 70% for 2020. Rates of financial “exclusion” are higher among the poor, those living in rural areas, and those who are less-educated. Interestingly, neither gender nor age are relevant factors that explain financial exclusion in ASEAN countries. In ASEAN countries, only 29% of workers reported receiving their monthly salaries through an account from a financial institution, while the remaining 71% is paid in cash by their employers. (Source: http://blogs.worldbank.org/eastasiapacific/how-to-scale-up-financial-inclusion-in-asean-countries).

We believe the unbanked population in the ASEAN region represents an untapped opportunity, as individuals without accounts at financial institutions are limited in their ability to shop or engage in other financial transactions online. We intend to focus on the ASEAN region, especially the unbanked market which is generally not the main focus of many large corporations. We believe that our model of converting VX spending into reward incentives and rebates that are redeemable on our platform allows the unbanked market to access our online platform for new and additional spending experiences without the requirement of having an account at a financial institution.

INTELLECTUAL PROPERTY AND PATENTS

We expect to rely on patents, trade secrets, copyrights, know-how, trademarks, license agreements and contractual provisions to establish our intellectual property rights and protect our “VMore Express” brand and services. These legal means, however, afford only limited protection and may not adequately protect our rights. Litigation may be necessary in the future to enforce our intellectual property rights, protect our trade secrets or determine the validity and scope of the proprietary rights of others. Litigation could result in substantial costs and diversion of resources and management attention. Any unauthorized disclosure or use of our intellectual property could make it more expensive to do business and harm our operating results.

The laws of Singapore and our target countries may not protect our brand and services and intellectual property to the same extent as U.S. laws, if at all. We may be unable to fully protect our intellectual property rights in these countries. Further, companies in the internet, social media technology and other industries may own large numbers of patents, copyrights and trademarks and may frequently request license agreements, threaten litigation or file suit against us based on allegations of infringement or other violations of intellectual property rights.

We intend to seek the widest possible protection for significant product and process developments in our major markets through a combination of trade secrets, trademarks, copyrights and patents, if applicable. We anticipate that the form of protection will vary depending upon the level of protection afforded by the particular jurisdiction. Initially, we expect that our revenue will be derived principally from our operations in Singapore and other parts of Southeast Asia where intellectual property protection may be more limited and difficult to enforce. In such instances, we may seek protection of our intellectual property through measures taken to increase the confidentiality of our findings.

We intend to register trademarks as a means of protecting the brand names of VMSPL, its products, and systems. We intend protect our trademarks against infringement and also seek to register design protection where appropriate.

We rely on trade secrets and unpatentable know-how that we seek to protect, in part, by confidentiality agreements. We expect that, where applicable, we will require our employees to execute confidentiality agreements upon the commencement of employment with us. We expect these agreements to provide that all confidential information developed or made known to the individual during the course of the individual's relationship with us is to be kept confidential and not disclosed to third parties except in specific limited circumstances. The agreements will also provide that all inventions conceived by the individual while rendering services to us shall be assigned to us as the exclusive property of our company. There can be no assurance, however, that all persons who we desire to sign such agreements will sign, or if they do, that these agreements will not be breached, that we would have adequate remedies for any breach, or that our trade secrets or unpatentable know-how will not otherwise become known or be independently developed by competitors.

COMPETITION

We operate in a highly competitive and fragmented industry that is sensitive to price and service. We compete with leading beverage companies such as Luckin Coffee (China), Toastbox (Singapore) which may offer substantially the same or similar product offerings as us. We also compete with businesses that focus on particular merchant categories or markets as well as traditional cash payments and other popular online shopping websites and apps, and other traditional media companies that provide discounts on products and services. We believe the principal competitive factors in our market include the following:

breadth of consumer base and advertisers/merchants featured;

local presence and understanding of local business trends;

ability to deliver a high volume of relevant deals to consumers;

ability to produce high purchase rates for deals among users;

ability to generate positive return on investment for advertisers/merchants; and

strength and recognition of our brand.

Although we believe we compete favorably on the factors described above, we anticipate that larger, more established companies may directly compete with us as we continue to demonstrate the viability of a local online-to-offline & offline-to-online solution provider. Many of our current and potential competitors have longer operating histories, significantly greater financial, technical, marketing and other resources, larger product and services offerings, larger customer base and greater brand recognition. These factors may allow our competitors to benefit from their existing customer or subscriber base with lower acquisition costs or to respond more quickly than we can to new or emerging technologies and changes in customer requirements. These competitors may engage in more extensive research and development efforts, undertake more far-reaching marketing campaigns and adopt more aggressive pricing policies, which may allow them to build a larger subscriber base or to monetize that subscriber base more effectively than us. Our competitors may develop products or services that are similar to our products and services or that achieve greater market acceptance than our products and services. In addition, although we do not believe that merchant payment terms are a principal competitive factor in our market, they may become such a factor and we may be unable to compete fairly on such terms.

We hope to achieve revenue growth through mass adoption by users and merchants of our platform/ecosystem. We seek to increase our user and merchant base through user incentive programs and brand awareness marketing programs, among other things. We expect to focus on users and merchants located in China and the Asia Pacific region in the foreseeable future.

On January 31, 2021, we terminated our service office lease at 1 Raffles Place, #33-02, One Raffles Place Tower One, Singapore 048616. Our new principal is located at 45 Ubi Crescent, Singapore 408590.

On October 1, 2018, we purchased a building subject to a sixty year leasehold located at 45 Ubi Crescent, Singapore 408590 to serve as our primary operational center. The four storey building is approximately 13,000 square feet with a remaining lease term of thirty-eight years. The purchase price of S$4,480,000 (approximately US$3,295,819) was financed by a loan with Ethoz Capital Limited in the principal amount of S$3,136,000 (approximately US$2,307,073) at an annual rate of 3.75%, payable over 120 months commencing October 1, 2018. The loan is personally guaranteed by our Chief Executive Officer and Director, Eldee Tang. The foregoing description of the loan is qualified in its entirety by reference to the Secured Term Loan Facility dated September 14, 2018, which is filed as Exhibit 10.15 to this Quarterly Report and incorporated herein by reference.

On January 19, 2019, we opened a branch office in Taiwan to service merchants and customers of our online platform, V-more, located within the Greater China Region. Our Taiwan branch office also oversees the operations of a V-More branded office located in China and is operated by one of our sales affiliates. The Taiwan branch office is currently operated through our subsidiary VESG. The Taiwan branch office is a party to a lease agreement, a summary of which is as follows:

Name of Branch	Ventrepreneur (SG) Private Limited, Taiwan Branch
Office Address	282 Zheng Bei Road 2, Level 5 Unit 3, Xitun District, Taichung, Taiwan
Tenancy Period	December 1, 2018 to November 30, 2020
Premises Size	Approximately 3,000 square feet
Yearly Lease Amount	US$37,473 for Taiwan branch

In addition to our Taiwan office and China affiliate office, certain of our sales affiliates also operate additional V-More branded affiliate offices in the following regions: Indonesia, Thailand and Malaysia. We hope to memorialize the terms of operations of these affiliate offices in the near future.

Intellectual Property

We continue to own the rights, title and interests in Patent for a receptacle catheter with integral anchoring means, which Patent is associated with our former business. The Patent was issued on September 1, 2004 and will expire on September 6, 2022. We do not expect to exploit these Patents in the near future.

Results of Operations

The COVID-19 pandemic and the effects arising from efforts to contain the outbreak have materially and adversely affected our business and financial performance for the three and nine months ended December 31, 2020. Our unaudited condensed consolidated financial statements for the three and nine months ended December 31, 2020, includes a note about our ability to continue as a going concern due to consecutive quarterly losses from operations from the last year ended March 31, 2020, and continuing into the third fiscal quarter ended December 31, 2020, as a result of COVID-19. If COVID-19 continues to adversely affect our business and financial performance, we may not be able to generate sufficient cash flow to meet our operating expenses.

In response to the outbreak and related government-imposed restrictions impacting goods and services movement and fulfilment, we have taken a series of cost containment measures, including telecommute working for some employees, reducing pay and benefits for remaining employees, and cutting back capital spending. The above measures have affected our operating capacity and work efficiency, and negatively impacted our sales and marketing activities as well as our business performance. The extent to which COVID- 19 affects our business performance will depend on the future development of the epidemic, including new actions taken by the government to contain the outbreak, which is highly uncertain and unpredictable. In addition, if the economy of Southeast Asia as a whole is negatively impacted by the outbreak, our operating performance will also be adversely affected.

In light of the uncertainty as to when we can resume full operations and the uncertain customer demand environment, we are seeking financing from equity investors and financial institutions for current and projected future working capital and growth expansion purposes. In addition, we have also re-aligned our targeted sectors and increased product bundling in our business plan. Based on our revised business plan and updated forecast, we believe the Company will have sufficient operating cash flows to operate as a going concern over the next 12 months.

Comparison of the three months ended December 31, 2020 and December 31, 2019

The following table sets forth certain operational data for the three months ended December 31, 2020, as compared to the three months ended December 31, 2019:

	Three months ended December 31,
	2020			2019
Net Revenue	$	149,400		$	2,063,937
Cost of revenue		(9,676	)		(2,250,717	)
Gross profit (loss)		139,724			(186,780	)
Operating expenses:
Sales and marketing expense		(41,782	)		(83,651	)
General and operating expenses		(588,126	)		(1,316,808	)
Total operating expenses		(629,908	)		(1,400,459	)
Loss from operations		(490,184	)		(1,587,239	)
Loss before income taxes		(445,754	)		(1,582,782	)
NET LOSS	$	(497,697	)	$	(1,553,003	)

Net Revenue. We generated net revenue of $149,400 and $2,063,937 for the three months ended December 31, 2020 and 2019, respectively. The decrease in net revenue for the three months ended December 31, 2020 was due to COVID-19 related government imposed restrictions impacting goods and services movement and fulfilment. For the three months ended December 31, 2020, 93% of net revenue was contributed by Singapore. None of the other countries contribute more than 10% each. For the three months ended December 31, 2019, 15% of our net revenue was derived from income from V-More, our ecommerce platform, while 78% of our net revenue was contributed by our IoT business, mainly from smart coffee dispensing machines sales. The balance of net revenues consisted of mainly of administrative charges income and service income.

On a going forward basis, we hope to generate revenue from our IoT products such as our smart coffee dispensing machines, e-commerce platform as well as any products that we distribute for our merchants, as more merchants are progressively on boarded.

For the three months ended December 31, 2020 and 2019, the following geographic regions accounted for 10% or more of our total net revenues:

Country	December 31, 2020		December 31, 2019
Singapore		93%		94%
Malaysia		3%		1%
Philippines		–		–
Thailand		1%		–
Indonesia		1%		1%
Greater China Region		–		–
United States		–		–
Rest of the World		2%		4%
Total		100%		100%

For the three months ended December 31, 2020 and 2019, no customers accounted for 10% or more of our total net revenues.

Major Vendors.

For the three months ended December 31, 2020, no vendors account for more than 10% of the Company’s purchase.

	Three Months Ended December 31, 2019
Vendors	Purchase		Accounts Payable
Barista Uno Private Limited	$	544,751	$	355,913

For the three months ended December 31, 2019, Barista Uno Private Limited accounted for 24% of the Company’s purchases amounting to $544,751 with $355,913 of accounts payable. Eldee Tang, our Chief Executive Officer and Director, owns 31% of Barista Uno Private Limited.

Gross Profit/Loss. We achieved a gross profit of $139,724 and gross loss of $186,780 for the three months ended December 31, 2020, and 2019, respectively. The attributing factor for the increased in gross profit was due to lower cost during the Covid-19 pandemic climate. We expect to continue focus on the new IoT product line.

Operating Expenses.

	Three months ended December 31,
	2020		2019
Operating expenses:
Sales and marketing expense	$	41,782	$	83,651
General and operating expenses		588,126		1,316,808
Total operating expenses	$	629,908	$	1,400,459

During the three months ended December 31, 2020, and 2019, we incurred operating expenses of $629,908 and $1,400,459, respectively. Our operating expenses for the three months ended December 31, 2020 includes sales and marketing expense of $41,782 and general and operating expenses of $588,126. Our operating expenses for the three months ended December 31, 2019 includes sales and marketing expense of $83,651 and general and operating expenses of $1,316,808 inclusive of stock based compensation of $200,000. The overall decrease in operating expenses was due to the streamlining of processes to improve efficiencies and cost cutting measures taken amid the Covid-19 pandemic.

Net Loss. We recorded a net loss of $497,697 and $1,553,003 for the three months ended December 31, 2020, and 2019, respectively. The decrease in net loss is primarily attributable to a decrease in our cost of revenue combined with the overall decrease in revenue during the Covid-19 pandemic. We hope to make progressive changes to our business model over the next few months to improve our net income during the Covid-19 pandemic situation.

Comparison of the nine months ended December 31, 2020 and December 31, 2019

The following table sets forth certain operational data for the nine months ended December 31, 2020, as compared to the nine months ended December 31, 2019:

	Nine months ended December 31,
	2020			2019
Net Revenue	$	399,475		$	14,674,821
Cost of revenue		(94,992	)		(8,311,170	)
Gross profit		304,483			6,363,651
Operating expenses:
Sales and marketing expense		(475,363	)		(421,972	)
General and operating expenses		(2,182,625	)		(14,509,066	)
Total operating expenses		(2,657,988	)		(14,931,038	)
Loss from operations		(2,353,505	)		(8,567,387	)
Loss before income taxes		(2,075,340	)		(8,548,576	)
NET LOSS	$	(2,175,265	)	$	(8,530,021	)

Net Revenue. We generated net revenue of $399,475and $14,674,821 for the nine months ended December 31, 2020 and 2019, respectively. The decrease in net revenue for the nine months ended December 31, 2020 was due to COVID-19 related government imposed restrictions impacting goods and services movement and fulfilment. For the nine months ended December 31, 2020, 91% of net revenue was contributed by Singapore. None of the other countries contribute more than 10% each. For the nine months ended December 31, 2019, 77% of our net revenues were derived from income from V-More, our ecommerce platform. Sales from our IoT’s coffee machines contributed 20% to our revenue for the nine months ended December 31, 2019. The balance of net revenues consisted of mainly of administrative charges income, service income. On a going forward basis, we hope to generate revenue from our IoT products such as our smart coffee dispensing machines, e-commerce platform as well as any products that we distribute for our merchants, as more merchants are progressively on boarded.

For the nine months ended December 31, 2020 and 2019, the following geographic regions accounted for 10% or more of our total net revenues:

Country	December 31, 2020		December 31, 2019
Singapore		91%		50%
Malaysia		3%		25%
Philippines		1%		11%
Thailand		1%		5%
Indonesia		2%		3%
Greater China Region		–		2%
United States		–		–
Rest of the World		2%		4%
Total		100%		100%

For the nine months ended December 31, 2020 and 2019, no customers accounted for 10% or more of our total net revenues.

Major Vendors.

For the nine months ended December 31, 2020, no vendors account for more than 10% of the Company’s purchase.

	Nine months ended December 31, 2019
Vendors	Purchase		Accounts Payable
Barista Uno Private Limited	$	1,580,300	$	355,913

For the nine months ended December 31, 2019, Barista Uno Private Limited accounted for 19% of the Company’s purchase amounting to $1,580,300 with $355,913 of accounts payable. Eldee Tang, our Chief Executive Officer and Director, owns 31% of Barista Uno Private Limited.

Gross Profit. We achieved a gross profit of $304,483 and $6,363,651 for the nine months ended December 31, 2020, and 2019, respectively. The attributing factor for the decreased in gross profit was due to lower sales during the Covid-19 pandemic climate. We expect to continue focus on the new IoT product line.

Operating Expenses.

	Nine months ended December 31,
	2020		2019
Operating expenses:
Sales and marketing expense	$	475,363	$	421,972
General and operating expenses		2,182,625		14,509,066
Total operating expenses		2,657,988		14,931,038

During the nine months ended December 31, 2020, and 2019, we incurred operating expenses of $2,657,988 and $14,931,038, respectively. Our operating expenses for the nine months ended December 31, 2020 includes sales and marketing expense of $475,363 and general and operating expenses of $2,182,625. There was no stock based compensation in the nine months ended December 31, 2020, resulting in lower operating expenses. Our operating expenses for the nine months ended December 31, 2019 included a one-time charge of $11,136,760 arising from the issuance of shares of our common stock as compensation to our sales affiliates, merchant acquisition consultants and digital offerings consultant.

Net Loss.

We recorded a net loss of $2,175,265 and $8,530,021 for the nine months ended December 31, 2020, and 2019, respectively. The decrease in net loss is primarily attributable to the one time stock based compensation charge of $11,136,760 for the nine months ended December 31, 2019. We hope to make progressive changes to our business model over the next few months to further improve our net income during the Covid-19 pandemic situation.

Liquidity and Capital Resources

As of December 31, 2020, we had current assets of $7,260,127 and current liabilities of $13,066,140. Our current assets consisted of $35,368 of cash and cash equivalents, $158,827 of account receivable, purchase deposits of $1,744,364, deferred costs of $4,809,553, $496,575 of deposits, prepayment and other receivable and inventories of $15,440. Our current liabilities consisted of $3,115,408 of accrued liabilities and account payables, $1,112,209 of commission liabilities, $6,988,129 of deferred revenue, $131,119 of income tax payable, $1,075,613 of amount due to Eldee Tang, our Chief Executive Officer and Director, $363,345 of current portion of borrowings and $280,317 of amount due to a related party for which it represents an unsecured non-interest bearing advance from our former shareholder Ms. Kao Wei-Chen.

As of March 31, 2020, we had current assets of $6,746,428 and current liabilities of $10,056,164. Our current assets consisted of $223,527 of cash and cash equivalents, deferred cost of $4,252,107, $152,545 of accounts receivable, purchase deposits of $1,619,966, $418,541 of deposits, prepayment and other receivables, inventories of $14,339 and tax recoverable of $65,403. Our current liabilities consisted of $2,216,563 of account payables and accrued liabilities, $1,045,568 of commission liabilities, $6,239,296 of deferred revenue, $17,662 of amount due to Eldee Tang, our Chief Executive Officer and Director, $280,317 of amount due to a related party consisting of unsecured non-interest bearing advances from our former shareholder Ms. Kao Wei-Chen and current portion of borrowing of $256,758.

We had accumulated deficits of $139,876,857 and $137,703,504 as of December 31, 2020 and March 31, 2020, respectively. The increase in accumulated deficit is mainly due to the dire decreased in sales volume, as a result of government imposed restrictions on the movement of goods and services globally and locally.

	Nine months ended December 31,
	2020			2019
Net cash (used in) generated from operating activities	$	(1,073,161	)	$	446,616
Net cash used in investing activities	$	(77,975	)	$	(47,065	)
Net cash generated from (used in) financing activities	$	887,825		$	(234,617	)

Net Cash (Used in) Generated from Operating Activities

Net cash used in operating activities was $1,073,161 for the nine months ended December 31, 2020, and consisted primarily of a net loss of $2,175,265, adjusted for amortization of intangible of $1,746, depreciation of property, plant and equipment of $192,573, a decrease in account receivable of $5,390, a decrease in deposits, prepayment and other receivable of $60,824, an increase in accrued liabilities and account payables of $723,002, an increase in deferred revenue of $267,628, an increase in tax payable of $93,623, offset by an increase in deferred costs of $229,139 and a decrease in commission liabilities of $13,543.

Net cash generated from operating activities was $446,616 for the nine months ended December 31, 2019, and consisted primarily of a net loss of $8,530,021, adjusted for amortization of intangible assets of $206,390, depreciation of property, plant and equipment of $147,031, a gain on disposal of property, plant and equipment of $3,604 and a one-time non-cash stock based compensation of $11,136,760, a decrease in account receivable of $4,895,929, an increase in account payables of $372,722, an increase in accrued liabilities and other payables of $835,358, an decrease in deposits, prepayments and other receivable of $137,637, a decrease in tax payable of $131,886, decrease in commission liabilities of $404,283 by an increase in purchase deposits of $2,214,407, and a decrease in deferred revenue of $6,001,010.

Net Cash Used In Investing Activities

Net cash used in investing activities was $77,975 for the nine months ended December 31, 2020, and consisted primarily of purchase of property, plant and equipment of $77,975. Net cash used in investing activities was $47,065 for the nine months ended December 31, 2019, and consisted primarily of proceeds from disposal of property, plant and equipment of $52,676 and purchase of property, plant and equipment of $99,741.

Net Cash Generated From (Used in) Financing Activities

Net cash generated from financing activities for the nine months ended December 31, 2020, was $887,825 and consisted primarily of advance from a director of $1,048,427, repayment of loan of $122,586 and repayment of finance lease of $38,016. Net cash used in financing activities for the nine months ended December 31, 2019, was $234,617 and consisted primarily of repayment to director $73,089 and repayment of finance lease of $161,528.

We have never paid dividends on our Common Stock. Our present policy is to apply cash to investments in product development, acquisitions or expansion; consequently, we do not expect to pay dividends on Common Stock in the foreseeable future.

The success of our growth strategy is dependent upon the availability of additional capital resources on terms satisfactory to management as we are not generating sufficient revenues from our business operations. Our sources of capital in the past have included the sale of equity securities, which include common stock sold in private transactions, capital leases and stockholder advances. There can be no assurance that we can raise such additional capital resources on satisfactory terms. We believe that our current cash and other sources of liquidity discussed above are adequate to support operations for at least the next 12 months. We anticipate continuing to rely on equity sales of our common shares and shareholder loans in order to continue to fund our business operations. Issuances of additional shares will result in dilution to our existing shareholders. There is no assurance that we will achieve any additional sales of our equity securities or arrange for debt or other financing to fund our plan of operations.

Off-Balance Sheet Arrangements

We have no outstanding off-balance sheet guarantees, interest rate swap transactions or foreign currency contracts. We do not engage in trading activities involving non-exchange traded contracts.

Going Concern

The unaudited condensed financial statements contain an explanatory paragraph expressing substantial doubt about our ability to continue operating as a going concern. The financial statements have been prepared "assuming that we will continue as a going concern," which states that we will realize our assets and satisfy any liabilities and commitments in the ordinary course of business.

Critical Accounting Policies and Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires our management to make assumptions, estimates and judgments that affect the amounts reported, including the notes thereto, and related disclosures of commitments and contingencies, if any. We have identified certain accounting policies that are significant to the preparation of our financial statements. These accounting policies are important for an understanding of our financial condition and results of operations. Critical accounting policies are those that are most important to the presentation of our financial condition and results of operations and require management's subjective or complex judgment, often as a result of the need to make estimates about the effect of matters that are inherently uncertain and may change in subsequent periods. Certain accounting estimates are particularly sensitive because of their significance to financial statements and because of the possibility that future events affecting the estimate may differ significantly from management's current judgments. We believe the following accounting policies are critical in the preparation of our financial statements.

·	Basis of presentation

These accompanying condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“US GAAP”).

·	Use of estimates

In preparing these condensed consolidated financial statements, management makes estimates and assumptions that affect the reported amounts of assets and liabilities in the balance sheets and revenues and expenses during the periods reported. Actual results may differ from these estimates.

·	Intangible assets

·	Property, plant and equipment

		Expected useful lives
Building		38 years or lesser than term of lease
Leasehold improvements		3 - 10 years or lesser than term of lease
Furniture and fittings		3 years
Office equipment and computers		1 - 5 years
Motor vehicle		3 - 3.33 years

·	Revenue recognition

	·	identify the contract with a customer;
	·	identify the performance obligations in the contract;
	·	determine the transaction price;
	·	allocate the transaction price to performance obligations in the contract; and
	·	recognize revenue as the performance obligation is satisfied.

Product sales are recorded net of good and service taxes and product returns.

·	Commission credits

·	Foreign currencies translation

Translation of amounts from S$ into US$1 has been made at the following exchange rates for the nine months ended December 31, 2020 and 2019:

	December 31, 2020		December 31, 2019
Period-end S$:US$1 exchange rate		1.3221		1.3552
Period average S$:US$1 exchange rate		1.3324		1.3668

·	Related parties

The Company follows the ASC 850-10, Related Party for the identification of related parties and disclosure of related party transactions.

·	Fair value of financial instruments

Level 1		Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.

Level 2		Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.

Level 3		Pricing inputs that are generally observable inputs and not corroborated by market data.

The carrying amounts of the Company’s financial assets and liabilities, such as cash and cash equivalents, approximate their fair values because of the short maturity of these instruments.

·	Recent accounting pronouncements

ITEM 3 Quantitative and Qualitative Disclosures about Market Risk

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information required under this item.

ITEM 4 Controls and Procedures

Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures

We conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended (Exchange Act), under the supervision of and with the participation of our management, including the Chief Executive Officer and Chief Financial Officer. Based on that evaluation, our management, including the Chief Executive Officer and Chief Financial Officer, concluded that our disclosure controls and procedures, subject to limitations as noted below, as of December 31, 2020, and during the period prior to and including the date of this report, were not effective to ensure that all information required to be disclosed by us in the reports that we file or submit under the Exchange Act is: (i) recorded, processed, summarized and reported, within the time periods specified in the Commission’s rule and forms; and (ii) accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. The Chief Executive Officer and Chief Financial Officer concluded that (i) there continue to be material weaknesses in the Company’s internal controls over financial reporting, that the weaknesses constitute a “deficiency” which could result in misstatements of the foregoing accounts and disclosures that could result in a material misstatement to the financial statements for the period covered by this report that would not be detected, and (ii) accordingly, our disclosure controls and procedures may not be effective as of December 31, 2020.

Inherent Limitations

Because of its inherent limitations, our disclosure controls and procedures may not prevent or detect misstatements. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies and procedures may deteriorate.

Changes in Internal Control 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 December 31, 2020, that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II OTHER INFORMATION

ITEM 1 Legal Proceedings

In April 2020, we received invoices from each of the Public Company Accounting Oversight Board (“PCAOB”) and the Financial Accounting Standards Board (“FASB”) in the amounts of $702,600 and $92,100, respectively, for our share of the PCAOB and FASB Issuer Accounting Support Fee for calendar year 2020. The fees were due May 18, 2020. We have petitioned the PCAOB and FASB to review our fee assessments and are in the process of review. We believe that there is a material likelihood that we will not prevail, and that we will be required to pay all assessed fees.

We expect that the aggregate range of reasonably possible losses for such legal proceeding is likely to range from approximately $800,000 and upwards if penalties or interest are assessed against us in the event that the Company is unable to timely pay assessed amounts. It is probable that $800,000 will be payable by March 31, 2021. The estimated aggregate range of reasonably possible losses is based upon currently available information for those proceedings in which the Company is involved, taking into account the Company’s best estimate of such losses for those cases for which such estimate can be made. Those matters for which an estimate is not possible are not included within this estimated range. Therefore, such range represents what the Company believes to be an estimate of possible loss only for those matters meeting such criteria. It does not represent the Company’s maximum loss exposure.

Except as set forth above, there are no material pending legal proceedings to which we or our subsidiaries are a party or to which any of our or their property is subject, nor are there any such proceedings known to be contemplated by governmental authorities. None of our directors, officers, affiliates or any owner of record or beneficially of more than 5% of our common stock, or any associate of any of the foregoing, is involved in a proceeding adverse to our business or has a material interest adverse to our business.

ITEM 1A Risk Factors

If we are unsuccessful in appealing our fee assessments from PCAOB and FASB and we are unable to pay such fees, we may be unable to maintain our status as a smaller reporting company. Losing our status as a smaller reporting company may adversely affect our ability to establish a public trading market for our common stock. As a result, you may experience difficulties in reselling your stock.

PCAOB Rule 7104(b)(1) provides that a registered public accounting firm is prohibited from (i) signing an unqualified audit opinion with respect to an issuer’s financial statements, (ii) issuing a consent to include an audit opinion issued previously, or (iii) signing a document, report, notice, or other record concerning procedures or controls of any issuer required under the securities laws (collectively, the "auditor services described in PCAOB Rule 7104(b)") unless the registered public accounting firm has ascertained that the issuer (including any broker or dealer subsidiary of the issuer) has no outstanding past-due share of the PCAOB or FASB issuer accounting support fees or has a petition pursuant to PCAOB Rule 7103(c) pending. We cannot assure you that we will be able to timely pay assessed PCAOB fees in the event we are unable to prevail in our appeal. If our auditor is prohibited from performing the foregoing actions, we may not be able to retain our status as a smaller reporting company. We may be required to report under an alternative standard such as the alternative reporting standards enumerated by the OTC Markets Group. Reporting under an alternative reporting standard may adversely affect our ability to establish a public trading market for our common stock as trading of securities on the OTC Pink is often sporadic. In such event, investors may have difficulty buying and selling our shares or obtaining market quotations for them, which may have a negative effect on the market price of our common stock. You may not be able to sell your shares at their purchase price or at any price at all. Accordingly, you may have difficulty reselling any shares you purchase from the selling security holders.

COVID-19 has had an adverse effect that is material on our business and may continue to do so for the next twelve months.

During March 2020, the World Health Organization declared the rapidly growing coronavirus outbreak to be a global pandemic. The COVID-19 pandemic has significantly impacted health and economic conditions throughout Singapore and Southeast Asia. National, regional and local governments took a variety of actions to contain the spread of COVID-19, including office and store closures, quarantining suspected COVID-19 patients, and capacity limitations. These developments have significantly impacted our results of operations, financial condition and cash flows.

In response to the outbreak and related government-imposed restrictions impacting goods and services movement and fulfilment, we have taken a series of measures accordingly, including telecommute working for some employees, reducing pay and benefits for remaining employees, and cutting back capital spending. The above measures have affected our operating capacity and work efficiency, and negatively impacted our sales and marketing activities as well as its business performance. The extent to which COVID-19 affects our business performance will depend on the future development of the epidemic, including new actions taken by the government to contain the outbreak, which is highly uncertain and unpredictable. In addition, if the economy of Southeast Asia as a whole is negatively impacted by the outbreak, our operating performance will also be adversely affected.

Our unaudited condensed consolidated financial statements for the three months ended December 31, 2020, has included a note about our ability to continue as a going concern due to consecutive quarterly losses from operations from the last quarter and continuing into the second quarter of 2021 as a result of COVID-19. If COVID-19 continues to adversely affect our business and financial performance, we may not be able to generate sufficient cash flow to meet our operating expenses.

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.	Name of Exhibit
3.1	Amended and Restated Certificate of Incorporation (1)
3.	Amended and Restated Bylaws (1)
4.1	Form of common stock certificate (2)
4.2	Description of Capital Stock (3)
10.1	Patent Transfer and Sales Agreement dated July 27, 2010 (2)
10.2	Share Sale Agreement, dated January 29, 2018, by and between Eldee Wai Chong Tang and Kao Wei Chen (4)
10.3	Form of Stockholder Representation Letters (5)
10.4	Form of Stockholder Representation Letters (6)
10.5	Form of Trustee Letter (7)
10.6	Form of Stockholder Representation Letters (8)
10.7	Form of Trustee Letter (9)
10.8	V-More Merchant Acquisition Agreement dated March 19, 2019, by and between Noble Vici Group, Inc. and Frank Chia Kok Meng (10)
10.9	V-More Merchant Acquisition Agreement dated March 19, 2019, by and between Noble Vici Group, Inc. and Lew Chuen Cheah (11)
10.10	V-More Merchant Acquisition Agreement dated March 19, 2019, by and between Noble Vici Group, Inc. and Yang Shang Yue (12)
10.11	Consulting Agreement dated March 19, 2019, by and between Noble Vici Group, Inc. and Sukullayanee Suwunnavid (13)
10.12	Consulting Agreement dated October 8, 2019, by and between Noble Vici Group, Inc. and Jenny Chen-Drake (14)
10.13	Secured Term Loan Facility dated September 14, 2018, by Ethoz Capital Ltd. in favor of UB45 Pte. Ltd. (16)
10.14	Employment Letter, dated March 29, 2018, by and between Noble Vici Private Limited and Eldee Tang Wai Chong (15)
10.15	Employment Agreement, dated March 29, 2018, by and between Noble Vici Private Limited and Yip Sin Chi (17)
14	Code of Business Conduct and Ethics (18)
21	List of Subsidiaries *
31.1	Certification required under Rule 13a-14(a)/15d-14(a) under the Exchange Act.*
32.1	Certification pursuant to 18 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 Schema Document*
101.CAL	XBRL Calculation Linkbase Document*
101.DEF	XBRL Definition Linkbase Document*
101.LAB	XBRL Label Linkbase Document*
101.PRE	XBRL Presentation Linkbase Document*

*Filed herewith.

(1)		Incorporated by reference from the Exhibits to the Definitive Information Statement on Schedule 14C with the Securities and Exchange Commission on May 7, 2018, and incorporated herein by reference.
(2)		Incorporated by reference from the Exhibits to our Registration Statement on Form S-1 filed with the Securities and Exchange Commission on October 12, 2010, and incorporated herein by reference.
(3)		Incorporated by reference from Exhibit 4.2 to our Annual Report on Form 10-K filed with the Securities and Exchange Commission on August 14, 2020.
(4)		Incorporated by reference from the Exhibits to our Current Report on Form 8-K filed with the Securities and Exchange Commission on August 8, 2018.
(5)		Incorporated by reference from Exhibit 10.3 to our Current Report on Form 8-K filed with the Securities and Exchange Commission on September 17, 2018.
(6)		Incorporated by reference from Exhibit 10.2 to our Current Report on Form 8-K filed with the Securities and Exchange Commission on December 6, 2018.
(7)		Incorporated by reference from Exhibit 10.3 to our Current Report on Form 8-K filed with the Securities and Exchange Commission on December 6, 2018.
(8)		Incorporated by reference from Exhibits 10.2 to our Current Report on Form 8-K filed with the Securities and Exchange Commission on March 11, 2019.
(9)		Incorporated by reference from Exhibits 10.3 to our Current Report on Form 8-K filed with the Securities and Exchange Commission on March 11, 2019.
(10)		Incorporated by reference from Exhibit 10.1 to our Registration Statement on Form S-8 filed with the Securities and Exchange Commission on March 19, 2019.
(11)		Incorporated by reference from the Exhibit 10.2 to our Registration Statement on Form S-8 filed with the Securities and Exchange Commission on March 19, 2019.
(12)		Incorporated by reference from Exhibit 10.3 to our Registration Statement on Form S-8 filed with the Securities and Exchange Commission on March 19, 2019.
(13)		Incorporated by reference from Exhibit 10.4 to our Registration Statement on Form S-8 filed with the Securities and Exchange Commission on March 19, 2019.
(14)		Incorporated by reference from Exhibit 10.1 to our Registration Statement on Form S-8 filed with the Securities and Exchange Commission on October 9, 2019.
(15)		Incorporated by reference from the Exhibits to our Current Report on Form 8-K filed with the Securities and Exchange Commission on August 8, 2018.
(16)		Incorporated by reference from Exhibit 10.4 to our Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on February 2, 2019.
(17)		Incorporated by reference from Exhibit 10.1 to our Current Report on Form 8-K filed with the Securities and Exchange Commission on June 17, 2019.
(18)		Incorporated by reference from Exhibit 14 to our Current Report on Form 8-K filed with the Securities and Exchange Commission on May 16, 2018.

SIGNATURES

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

	NOBLE VICI GROUP, INC.


	By:	/s/ Eldee Wai Chong Tang
		Eldee Wai Chong Tang
		Chief Executive Officer




Date: February 12, 2021

Noble Vici Group, Inc. 10-Q