item 14 principal accountant fees services audit fees negotiated package fees billed dave banerjee cpa independent accountancy firm 9500 audit company’s annual consolidated financial statements year ended june 30 2015 1500 per quarter review unaudited quarterly financial statements fees company pay dave banerjee cpa nonaudit fees fiscal year 2015 2014 part iv item 15 item 14 principal accountant fees services audit fees aggregate fees billed kabani company independent auditors audit company’s annual consolidated financial statements reviews quarterly financial statements years ended june 30 2008 2007 45000 year fees company pay kabani company nonaudit fees fiscal year 2008 2007 part iv item 15 item 14 principal accountant fees services audit fees aggregate fees billed kabani company independent auditors audit company’s annual consolidated financial statements reviews quarterly financial statements years ended june 30 2010 2009 54500and 54500 respectively fees company pay kabani company nonaudit fees fiscal year 2010 2009 part iv item 15 item 14 principal accountant fees services audit fees negotiated package fees billed dylanfloyd accounting consulting independent accountancy firm 16500 audit company’s annual consolidated financial statements fiscal year ended june 30 2018 review unaudited financial statements quarters ending september 30 december 31 2018 march 31 2019 fees company pay dylanfloyd accounting consulting dave banerjee cpa company’s predecessor auditor nonaudit fees fiscal year 2018 2017 part iv item 15 item 14 principal accountant fees services audit fees negotiated package fees billed dave banerjee cpa independent accountancy firm 9500 audit company’s annual consolidated financial statements year ended june 30 2014 1500 per quarter review unaudited quarterly financial statements fees company pay dave banerjee cpa nonaudit fees fiscal year 2014 2013 part iv item 15 item 14 principal accountant fees services audit fees negotiated package fees billed dave banerjee cpa independent accountancy firm 9000 audit company’s annual consolidated financial statements year ended june 30 2016 1500 per quarter review unaudited quarterly financial statements fees company pay dave banerjee cpa nonaudit fees fiscal year 2016 2015 part iv item 15 item 14 principal accountant fees services audit fees negotiated package fees billed ms madhava rao independent accountancy firm 18000 audit company’s annual consolidated financial statements fiscal year ended june 30 2019 review unaudited financial statements quarters ending 9302019 12312019 3312020 fees company pay ms madhava rao dylanfloyd accounting consulting company’s predecessor auditor nonaudit fees fiscal year 2019 2018 part iv item 15 item 14 principal accountant fees services audit fees aggregate fees billed kabani company previous independent auditors company audit company’s annual consolidated financial statements reviews quarterly financial statements year ended june 30 2010 54500 aggregate fees billed dave benerjee ca current independent auditors company audit company’s annual consolidated financial statements year ended june 30 2011 26800 fees company pay kabani company dave banerjee cpa nonaudit fees fiscal year 2011 2010 part iv item 15 item 14 principal accountant fees services audit fees aggregate fees billed dave banerjee ca company’s auditors audit company’s annual consolidated financial statements review quarterly consolidated financial statements year ended june 30 2011 26800 package aggregate fees billed dave banerjee cpa audit company’s annual consolidated financial statements years ended june 30 2012 june 30 2013 19000 fees company pay dave banerjee cpa nonaudit fees fiscal year 2012 2011 part iv item 15 item 14 principal accountant fees services audit fees aggregate fees billed dave banerjee ca company’s auditors audit company’s annual consolidated financial statements review quarterly consolidated financial statements year ended june 30 2011 26800 package aggregate fees billed dave banerjee cpa audit company’s annual consolidated financial statements years ended june 30 2012 june 30 2013 19000 fees company pay dave banerjee cpa nonaudit fees fiscal year 2013 2012 part iv item 15 item 14 principal accountant fees services audit fees negotiated package fees billed dave banerjee cpa independent accountancy firm 12000 audit company’s annual consolidated financial statements year ended june 30 2017 2500 per quarter review unaudited quarterly financial statements fees company pay dave banerjee cpa nonaudit fees fiscal year 2017 2016 part iv item 15 item 14 principal accountant fees services audit fees aggregate fees billed kabani company independent auditors audit company’s annual consolidated financial statements reviews quarterly financial statements years ended june 30 2009 2008 54500 45000 respectively fees company pay kabani company nonaudit fees fiscal year 2009 2008 part iv item 15 item 14 principal accountant fees services audit fees negotiated package fees billed ms madhava rao independent accountancy firm 19500 audit company’s annual consolidated financial statements fiscal year ended june 30 2020 review unaudited financial statements quarters ending 9302020 12312020 3312021 fees company pay ms madhava rao nonaudit fees fiscal year 2020 2019 part iv item 15 item 7 management’s discussion analysis financial condition results operations except audited historical information contained herein report specifies forwardlooking statements management company within meaning section 27a securities act 1933 section 21e securities exchange act 1934 “forwardlooking statements” including without limitation forwardlooking statements regarding company’s expectations beliefs intentions future strategies forwardlooking statements estimate happening future events based historical facts forward looking statements may identified use forwardlooking terminology “could” “may” “will” “expect” “shall” “estimate” “anticipate” “probable” “possible” “should” “continue” “intend” similar terms variations terms negative terms forwardlooking statements specified report compiled management company basis assumptions made management considered management reasonable future operating results company however impossible predict representation guaranty warranty inferred forwardlooking statements assumptions used purposes forwardlooking statements specified report represent estimates future events subject uncertainty possible changes economic legislative industry circumstances result identification interpretation data information use developing selecting assumptions among reasonable alternatives require exercise judgment extent assumed events occur outcome may vary substantially anticipated projected results accordingly opinion expressed achievability forwardlooking statements addition forwardlooking statements compiled date report evaluated consideration changes occurring date report assurance given assumptions relating forwardlooking statements specified report accurate company assumes obligation update forwardlooking statements results operations years ended june 30 2015 june 30 2014 revenues company generated 127178 revenues consulting advisory management services fiscal year ended june 30 2015 compared 77430 revenue year ended june 30 2014 operating expenses company incurred total operating expenses 433090 year ended june 30 2015 compared 381482 year ended june 30 2014 represents increase 51609 1353 total operating expenses prior year increase primarily due increase 34136 professional services increase 21334 general administrative expenses company utilized thirdparty professional services incurred additional travel expenses current year relative previous fiscal year income loss operations company loss operations 305912 fiscal year ended june 30 2015 compared loss operations 304042 year ended june 30 2014 represents increase 1870 062 loss operations current year compared precious year mainly due fact company generated additional amount 49739 revenues time incurred additional amount 51609 total operating expenses fiscal year ended june 30 2015 compared corresponding items fiscal year ended june 30 2014 income expense company net expense 1063003 year ended june 30 2015 compared net income 48048 prior year primarily due fact company interest expense 319315 loss sale marketable securities amount 45176 loss settlement debts amount 25845 expense amount 672667 comprises impairment marketable securities amount 599472 writeoff receivable amount 73043 net miscellaneous expense 152 current year whereas interest expense 323782 gain 372278 settlement debts year ended june 30 2014 net income loss company net loss 1368915 year ended june 30 2015 compared net loss 255994 year ended june 30 2014 company recorded loss sale marketable securities 45176 fiscal year ended june 30 2015 compared loss sale marketable securities 30 previous fiscal year interest expenses 319315 fiscal year ended june 30 2015 compared 323782 fiscal year ended june 30 2014 increase 1112921 primarily due noncash impairment marketable securities amount 599472 writeoff receivable amount 73043 decrease 4467 interest expense net loss sale marketable securities amount 45176 loss settlement debts amount 25845 current fiscal year compared gain 372278 settlement debts year ended june 30 2014 net loss based basic diluted weighted average number common shares outstanding year ended june 30 2015 0121 compared 004 year ended june 30 2014 cash flows 10654 cash equivalents june 30 2015 compared 30623 cash equivalents june 30 2014 respectively net cash used operating activities 1609353 fiscal year ended june 30 2015 compared net cash used operating activities 979676 fiscal year ended june 30 2014 respectively underlying reasons increase net cash used operating activities two periods mainly due net increase 1112921 net loss operations increase 109964 assets prepaid expenses net decrease 593207 accounts payable accrued expenses current fiscal year previous fiscal year net cash provided investing activities 65557 fiscal year ended june 30 2015 compared cash provided investing activities 99160 year ended june 30 2014 respectively underlying reasons decrease net cash provided investing activities two fiscal years primarily due cancellation 73043 discontinued operations net deposit 4936 acquisition investment joint venture amount 2550 year ended june 30 2015 compared receipts 99160 discontinued operations year ended june 30 2014 respectively net cash provided financing activities 1523827 fiscal year ended june 30 2015 compared cash provided financing activities 911139 fiscal year ended june 30 2014 respectively underlying reasons increase cash provided financing activities current fiscal year mainly due 258763 decrease proceeds common stock current previous fiscal years increase 808524 accumulated comprehensive income decrease accumulated deficit amount 639376 current fiscal year compared decrease minority interest 704205 payments notes payable 127756 prior fiscal year historical financing arrangements short term notes payable issuance common stock course business company obtained shortterm loans individuals institutional investors time raised money issuing restricted common stock company auspices rule 144 june 30 2015 2014 company shortterm notes payable amounting 1342618 1346721 accrued interest 3031152 2874509 respectively notes bear interest rates ranging 0 36 per annum years ended june 30 2015 2014 company paid 31500 127755 principal 4956 89440 interest shortterm notes respectively notes payable secured assets company summarized due preferred stockholders company classified 215000 preferred stock previously subscribed one long discontinued subsidiaries current liability payable holders preferred stock subsidiary due deficiencies connection previous preferred share subscription agreements amount past due june 30 2015 interest payable holders preferred stock abovementioned discontinued subsidiary amounts 387455 361655 included accrued interest included account payable accrued expenses balance sheet june 30 2015 june 30 2014 company’s plan operation following 12 months current scope business primarily focuses energy natural resources also engage international trade company’s key partners continue provide corporate finance project financing including merger acquisition advisory consulting services subsidiary phi capital holdings inc following twelve months commencing july 1 2015 company intends implement number plans including following ● develop carry reclamation sand business among vietnamese partners singapore brunei asian countries company signed agreements three vietnamese companies secured 100 million cubic meters saline sand immediate export 15 billion cubic meters saline sand future sale ● engage international trade areas energy products industrial commodities precious metals ● acquire 100000ton producing wood pellet mill north carolina usa would immediately add substantial revenues profitability company ● develop build 200000 mt wood pellet plant live oak florida cornerstone biomass corporation ● develop build oleochemical plant malaysia conjunction fusion crest sdn bhd production capacity 120 tons per day distilled fatty acid individual fatty acid cuts using alternative nonedible feedstock palm mills ● acquire majority vinabenny joint stock company arrange capital build 84000 mt liquefied petroleum gas terminal long province vietnam ● cooperate cavico lao mining ltd develop multimetal mine khoam bang ban bor bulikhamsay lao people’s democratic republic ● acquire coal concession assets indonesia longterm supply asian markets ● continue pending acquisition business cooperation opportunities involving titanium nickel precious metals sand limestone ● continue provide advisory consulting services assist international companies access us european asian capital markets however guarantee could made company would successful plans time frame financial plans material cash requirements must raise substantial amounts capital fulfill plan acquiring energyrelated natural resource assets part scope business intend use equity debt project financing meet capital needs acquisitions management taken action formulated plans strengthen companys working capital position generate sufficient cash meet operating needs june 30 2016 beyond working capital cash requirements next 12 months following end current fiscal year expected generated operations sale marketable securities additional financing company plans generate revenues consulting services merger acquisition advisory services trading activity joint operations companies available future financing arrangements company engaged number investment banking firms worked commercial banks negotiated private equity firms arrange financing potential acquisitions addition company process raising 60 million offering investment units consisting cumulative convertible preferred stock warrants auspices regulation 506c company believes able secure required capital implement business plan however assurances could made management would successful achieving plan item 7a item 7 managements discussion analysis financial condition results operations except audited historical information contained herein report specifies forwardlooking statements management company within meaning section 27a securities act 1933 section 21e securities exchange act 1934 forwardlooking statements including without limitation forwardlooking statements regarding companys expectations beliefs intentions future strategies forwardlooking statements estimate happening future events based historical facts forward looking statements may identified use forwardlooking terminology could may expect shall estimate anticipate probable possible continue intend similar terms variations terms negative terms forwardlooking statements specified report compiled management company basis assumptions made management considered management reasonable future operating results company however impossible predict representation guaranty warranty inferred forwardlooking statements assumptions used purposes forwardlooking statements specified report represent estimates future events subject uncertainty possible changes economic legislative industry circumstances result identification interpretation data information use developing selecting assumptions among reasonable alternatives require exercise judgment extent assumed events occur outcome may vary substantially anticipated projected results accordingly opinion expressed achievability forwardlooking statements addition forwardlooking statements compiled date report evaluated consideration changes occurring date report assurance given assumptions relating forwardlooking statements specified report accurate company assumes obligation update forwardlooking statements results operations years ended june 30 2008 june 30 2007 revenues company generated net revenue 3609318 consulting advisory services year ended june 30 2008 compared 3572347for year ended june 30 2007 represented 1 increase consulting advisory revenue increase mainly due slight increase size scope merger acquisition activities current year operating expenses company incurred total operating expenses 1658534 year ended june 30 2008 compared 4109367 year ended june 30 2007 represents 60 decrease operating expenses prior year decrease primarily due impairment assets recorded prior year impairment prior year represents 2903543 decline market value marketable securities 62500 impairment companys investment company’s professional fees increased 58 778440 year ended june 30 2008 compared 493052 prior year mainly due increase legal fees well audit accounting fees legal fees increased 112 64900 prior year 137635 due fund raising activities current year audit accounting fees increased 115157 current year due contract work provided outside accounting firm related due diligence service hiring contractor effective july 1 2007 net income loss operations company net income operations 1950784 year ended june 30 2008 compared loss operations 537020 year ended june 30 2007 mainly due 1 increase consulting advisory revenue 60 decrease operating expenses current fiscal year decrease operating expenses primarily due decrease impairment assets reduced increase professional expenses including noncash compensation current fiscal year net income company net income 2359282 year ended june 30 2008 compared net income 34304 year ended june 30 2007 fiscal year ended june 30 2008 included gain marketable securities 701832compared 139509 year ended june 30 2007 addition company recorded gain legal settlement 0 87841 year ended june 30 2008 2007 respectively company also recorded gain debt settlement 67719 year ended june 30 2008 compared 630749 year ended june 30 2007 net income based basic diluted weighted average number common shares outstanding year ended june 30 2008 001 compared 000 year ended june 30 2007 liquidity capital resources business plan restructured november 2000 updated nowcurrent form must continue raise capital fulfill plan acquiring companies assisting development internally company expects working capital cash requirements next 12 months generated operations additional financing cash equivalents 117166 7751 june 30 2008 june 30 2007 respectively operating activities used 1782930 cash year ended june 30 2008 compared 950203 year ended june 30 2007 largest items affecting cash operations marketable securities received services totaling 3639838 year ended june 30 2008 compared 3411877 prior year reduced impairment assets 2966043 gain sale marketable securities 701832 current fiscal year compared 139507 prior year cash provided investing activities 473478 804920 year ended june 30 2008 2007 respectively years ended june 30 2008 2007 company received 642094 958170 respectively sale marketable securities company spent 35388 110750 purchase marketable securities years ended june 30 2008 2007 respectively company used 106000 42500 investments year ended june 30 2008 2007 respectively company spent 27228 purchase fixed assets fiscal year ended june 30 2008 purchase made prior year cash provided financing activities 1418867 150631 years ended june 30 2008 2007 respectively year ended june 30 2008 primarily proceeds notes including borrowing officers amount 1678242 offset total payments notes amounting 255592 year ended june 30 2007 cash provided proceeds sale stock amounting 324746 borrowings officer totaling 250062 payment 112000 received subscription reduced payments notes amounting 519397 purchase treasury shares 16781 short term notes payable june 30 2008 company short term notes payable amounting 1816255 accrued interest 340753 notes bear interest rates ranging 6 36 per annum 773000 short term notes past due 222273 due demand year ended june 30 2008 company paid 174000 principal 196188 interest short term notes payable secured assets company summarized due preferred stockholders company classified 215000 preferred stock subscribed current liability payable holders preferred stock due non compliance preferred shares subscription agreement amount past due june 30 2008 company made 5000 interest payment year ended june 30 2007 interest payable holders preferred stock 206855 included accrued interest included account payable accrued expenses balance sheet june 30 2008 current liabilities year ended june 30 2004 company received overpayment 89691 exercise stock options amount paid company june 30 2008 classified payable included current liabilities companys plan operation next 12 months divestiture company’s diva subsidiaries june 2000 discontinuance securities brokerage operations october 2000 restructured updated primary scope business focus mergers acquisitions merger acquisition advisory services investments various businesses potential high growth next twelve months company intends emphasize advisory services small midsized companies us pacific rim focus development real estate program chu lai south hoi central vietnam philand corporation develop mining business southeast asia indochina mining corporation advance providential vietnam growth fund cayman islandbased private equity fund company general partner develop joint ventures cement financial communications businesses cavico vietnam pursue oil gas transactions providential energy corporation engage special situations may create value company’s shareholders guaranty company successful plans financial plans management taken action formulating additional plans strengthen companys working capital position generate sufficient cash meet operating needs june 30 2009 beyond among actions taken company intends raise additional capital us international markets currently process attaining additional financing addition company also anticipates generating revenue proposed mergers acquisitions assurances made management successful achieving plan item 7a item 7 financial statements independent auditors report board directors stockholders providential holdings inc audited accompanying consolidated balance sheet providential holdings inc nevada corporation subsidiaries june 30 2002 related consolidated statements operations stockholders deficit cash flows years ended june 30 2002 2001 consolidated financial statements responsibility companys management responsibility express opinion consolidated financial statements based audits conducted audits accordance auditing standards generally accepted united states america standards require plan perform audit obtain reasonable assurance whether financial statements free material misstatement audit includes examining test basis evidence supporting amounts disclosures consolidated financial statements audit also includes assessing accounting principles used significant estimates made management well evaluating overall financial statement presentation believe audits provide reasonable basis opinion consolidated financial statements referred present fairly material respects consolidated financial position providential holdings inc subsidiaries june 30 2002 results consolidated operations cash flows years ended june 30 2002 2001 conformity accounting principles generally accepted united states america companys financial statements prepared using generally accepted accounting principles applicable going concern contemplates realization assets liquidation liabilities normal course business company negative accumulated deficit incurred losses years ended june 30 2002 2001 factors discussed note 19 consolidated financial statements raises substantial doubt companys ability continue going concern managements plans regard matters also described note 19 consolidated financial statements include adjustments might result outcome uncertainty discussed note 3 13 financial statements company subject various law suits recent nasd examination july august 2000 providential securities inc wholly owned subsidiary nasd declared net capital deficiency violation pursuant conduct rules section 17 3 17 4 result providential securities inc withdrew membership nasd october 2000 ceased securities brokerage operations kabani company inc certified public accountants fountain valley california october 8 2002 providential holdings inc consolidated balance sheet june 302002 accompanying notes integral part consolidated financial statements providential holdings inc consolidated statements operations accompanying notes integral part consolidated financial statements providential holdings inc consolidated statements changes shareholders equity deficit years ended june 30 2002 june 30 2001 accompanying notes integral part consolidated financial statements providential holdings inc notes consolidated financial statements note 1 general summary significant accounting policies nature business reorganization providential holdings inc “phi organized laws state nevada june 8 1982 name jr consulting inc subsequently february 9 2000 changed name providential holdings inc inception september 7 1995 company generated nominal revenues actively engage business prior corporate combination agreement providential securities inc phi operating subsidiary diva entertainment inc “diva providential securities inc “providential incorporated state california october 8 1992 operated securities brokerage service fountain valley ca new york city ny principal markets providentials services individual investors located throughout united states providential bought sold securities customers number different markets utilizing brokerage clearinghouse transact trades subsequent yearend due results nasd examination providential ceased operations securities brokerage business see note 3 reorganization october 28 1999 phi entered corporate combination agreement “agreement providential whereby phi acquired outstanding shares providential exchange 20000000 shares phi common stock transaction consummated january 14 2000 addition covenant agreement phi required enter agreement sell havilland limited shares diva owned phi well assign rights title interest option agreement havilland limited option agreement gave phi option purchase additional shares divas common stock 001 par value order phi maintain least 65 interest divas outstanding common shares phis officers directors resigned positions shareholders providential assumed control two entities together “the company phi shares restricted resale pursuant provisions federal state securities laws providentials shareholders record closing date owned approximately 75 phis common stock acquisition treated capital transaction substance rather business combination deemed “reverse acquisition accounting purposes accordingly providential accounting acquirer operations phi included providential acquisition date sale diva consummated june 30 2000 whereby shares diva owned phi well rights title interest option agreement exchanged assignment assumption havilland limited amounts due phi officers diva amounting 617781 amounts due phi diva amounting 94843 return 135000 shares common stock phi owned havilland february 2000 company formed california corporation providential clearing inc vehicle effectuate purchase selfclearing brokerdealer operate securities clearing firm june 30 2002 subsidiary operations april 30 2002 company consummated agreement acquire 5667 equity interest slimtech inc nevada corporation exchange 3000000 shares companys restricted common stock slimtech plans distributor lcd liquid crystal display computer flat screens consumer electronics since slimtech dormant entity insignificant assets liabilities pro forma information presented note 2 summary significant accounting policies principles consolidation consolidated financial statements include accounts providential holdings inc providential securities inc providential clearing inc slimtech inc collectively referred company significant intercompany transactions eliminated consolidation cash equivalents company considers liquid investments maturity three months less date purchase readily convertible cash equivalents marketable securities companys securities classified availableforsale carried fair value securities classified availableforsale may sold response changes interest rates liquidity needs purposes company currently heldtomaturity trading securities unrealized holding gains losses availableforsale securities excluded earnings reported separate component stockholders equity realized gains losses securities classified availableforsale reported earnings based upon adjusted cost specific security sold impairment longlived assets longlived assets reviewed impairment whenever events changes circumstances indicate carrying amount may recoverable sum expected undiscounted cash flows less carrying value related asset group assets loss recognized difference fair value carrying value asset group assets property equipment property equipment stated cost maintenance repair costs charged expense incurred costs major additions betterments capitalized property equipment sold otherwise disposed cost related accumulated depreciation eliminated accounts resulting gain loss reflected income depreciation amortization cost property equipment depreciated estimated useful lives related assets depreciation amortization fixed assets computed straightline basis net earnings loss per share company adopted provisions statement financial accounting standards 128 earnings per share sfas 128 sfas 128 eliminates presentation primary fully diluted earnings per share eps requires presentation basic diluted eps basic eps computed dividing income loss available common stockholders weightedaverage number common shares outstanding period diluted eps based weightedaverage number shares common stock outstanding period common stock equivalents outstanding end period common stock equivalents excluded calculation weightedaverage shares purposes calculating diluted earnings per share 2002 2001 inclusion antidilutive stockbased compensation october 1995 fasb issued sfas 123 accounting stockbased compensation sfas 123 prescribes accounting reporting standards stockbased compensation plans including employee stock options restricted stock employee stock purchase plans stock appreciation rights sfas 123 requires compensation expense recorded using new fair value method ii using existing accounting rules prescribed accounting principles board opinion 25 accounting stock issued employees apb 25 related interpretations proforma disclosure net income earnings per share would company adopted new fair value method company elected account stockbased compensation plans intrinsic value method disclose pro forma amounts using fair value method fair value financial instruments statement financial accounting standard 107 disclosures fair value financial instruments requires company disclose estimated fair values financial instruments carrying amounts reported statements financial position current assets current liabilities qualifying financial instruments reasonable estimate fair value revenue recognition company recognized commission fee revenue security transaction complete commission fee earned company recognizes service income service completed companys revenue recognition policies compliance staff accounting bulletin sab 101 expenses recognized period corresponding liability incurred advertising company expenses advertising costs incurred comprehensive income statement financial accounting standards 130 reporting comprehensive income sfas 130 establishes standards reporting display comprehensive income components accumulated balances comprehensive income defined include changes equity except resulting investments owners distributions owners among disclosures sfas 130 requires items required recognized current accounting standards components comprehensive income reported financial statement displayed prominence financial statements income taxes deferred income tax assets liabilities computed annually differences financial statements tax basis assets liabilities result taxable deductible amounts future based enacted laws rates applicable periods differences expected affect taxable income loss valuation allowance established necessary reduce deferred tax assets amount expected realized reporting segments statement financial accounting standards 131 disclosures segments enterprise related information sfas 131 supersedes statement financial accounting standards 14 financial reporting segments business enterprise establishes standards way public enterprises report information operating segments annual financial statements requires reporting selected information operating segments interim financial statements regarding products services geographic areas major customers sfas 131 defines operating segments components enterprise separate financial information available evaluated regularly chief operating decision maker deciding allocate resources assessing performance currently sfas 131 effect companys consolidated financial statements substantially companys operations conducted one industry segment risks uncertainties normal course business company subject certain risks uncertainties company provides product unsecured credit customers consequently companys ability collect amounts due customers affected economic fluctuations customers ability pay accounting developments july 2001 fasb issued sfas 142 goodwill intangibles sfas 142 addresses initial recognition measurement amortization intangible assets acquired individually group assets acquired business combination addresses amortization provisions excess cost fair value net assets acquired intangibles acquired business combination statement effective fiscal years beginning december 15 2001 effective july 1 2001 intangibles acquired business combination initiated june 30 2001 company evaluated accounting effect arising recently issued sfas 142 goodwill intangibles companys financial position result company wrote goodwill 128560 derived business acquisition fiscal year ended june 30 2002 sfas 144 accounting impairment disposal longlived assets issued august 2001 sfas 144 effective fiscal years beginning december 15 2001 addresses financial accounting reporting impairment disposal longlived assets statement supersedes sfas 121 accounting impairment longlived assets longlived assets disposed accounting reporting provisions apb opinion 30 reporting results operations reporting effects disposal segment business extraordinary unusual infrequently occurring events transactions disposal segment business company evaluating accounting effect arising recently issued sfas 144 goodwill intangibles companys financial position results operations may 2002 board issued sfas 145 rescission fasb statements 4 44 64 amendment fasb statement 13 technical corrections sfas 145 sfas 145 rescinds automatic treatment gains losses extinguishments debt extraordinary unless meet criteria extraordinary items outlined apb opinion 30 reporting results operations reporting effects disposal segment business extraordinary unusual infrequently occurring events transactions sfas 145 also requires saleleaseback accounting certain lease modifications economic effects similar saleleaseback transactions makes various technical corrections existing pronouncements provisions sfas 145 related rescission fasb statement 4 effective fiscal years beginning may 15 2002 early adoption encouraged provisions sfas 145 effective transactions occurring may 15 2002 early adoption encouraged company anticipate adoption sfas 145 material effect earnings financial position june 2002 fasb issued sfas 146 “accounting costs associated exit disposal activities statement addresses financial accounting reporting costs associated exit disposal activities nullifies emerging issues task force eitf issue 943 “liability recognition certain employee termination benefits costs exit activity including certain costs incurred restructuring statement requires liability cost associated exit disposal activity recognized liability incurred eitf issue 943 liability exit cost defined recognized date entitys commitment exit plan provisions statement effective exit disposal activities initiated december 31 2002 earlier application encouraged company expect adoption sfas 146 material impact financial position results operations reclassifications certain amounts 2001 financial statements reclassified conform 2002 presentation note 3 nasd examination discontinuance providential securities inc completion routine audit providential securities inc providential july august 2000 national association securities dealers inc alleged providential violated certain provisions nasds conduct rules 2120 2330 2110 3010 rules 15c24 10b5 10b9 15c33 securities exchange commission providential securities inc henry fahman voluntarily submitted letter acceptance waiver consent “awc accepted nasd regulation inc october 27 2000 follows providential henry fahman accepted consented without admitting denying alleged violations entry following findings nasd regulation inc december 15 1998 june 15 1999 providential securities private placement memorandum offered sold one hundred three thousand 103000 shares series class convertible cumulative preferred stock providential securities inc five hundred fifteen thousand dollars 515000 twentytwo 22 customers connection private placement memorandum providential securities made certain misrepresentations omissions soliciting investments public customers failure disclose officer providential securities could make contributions help meet minimum requirement failure disclose providential securities incs disciplinary history whereby providential securities inc henry fahman jointly severally fined 28500 net capital deficiencies failing send requisite written notification confirmation fifty eight 58 securities transactions public customers failure disclose henry fahman ordered requalify examination financial operational principal providentials use private placement funds mainly providentials operational purposes represented private placement memorandum amounted conversion improper use funds thus violating conduct rules 2110 2330 providential acting henry fahman violated sec rule 15c24 sec rule 10b9 conduct rule 2110 utilizing proper escrow account investment funds received b retaining private placement funds minimum requirement met c refunding funds customers minimum met timely manner receiving controlling funds public customers connection private placement providential became obligated comply full provisions sec rule 15c33 period january least march 1999 providential securities henry fahman providentials financial operations principal theodore fahman failed compute reserve requirements set aside appropriate reserves customer protection providential acting henry fahman violation conduct rule 3010a membership registration rule 1018 operating three nonregistered supervisory jurisdiction branch offices providentials membership agreement limited firms branch activities two branches least seven fullservice satellite locations thereby violating conduct rule 2110 membership registration rule 1014 providential henry fahman also violated membership registration rule 1030 failing enforce membership registration rule 1031a allowing four individuals deficiencies license registration conduct securities business much 1998 1999 providential henry fahman failed comply membership registration rule 1030 failing enforce rule 1032f allowing five individuals act capacity equity trader deficiency registration limited representativeequity traders providential henry fahman also violated membership registration rule 1120 conduct rule 2110 permitting broker conduct business earn commissions status inactive result failing complete continuing education requirements may 2 2000 may 30 2000 providential securities inc distributed biased communications public regarding protimer service world wide web providential securities inc henry fahman also consented imposition maximum following sanctions providential shall censured fined 11500000 shall offer rescission public customers participated providential private placement providential shall provide proof form satisfactory nasdrs district 2 staff offer rescission customers participated providential private placement addition extent offer rescission accepted investors providential ordered provide proof payment restitution form satisfactory district 2 nasdr staff later 120 days acceptance letter acceptance waiver consent henry fahman shall banned capacities associating nasd member based upon abovementioned circumstances providential securities inc withdrew membership nasd october 2000 ceased securities brokerage operation fine 115000 included accrued expenses accompanying consolidated financial statements company offered preferred stock holders rescission investment date report company redeemed 65000 preferred stock plus accrued interest note 4 impairment assets company wrote fixed asset amounting 80000 receivables 172868 deemed unrecoverable year ended june 31 2002 company also wrote 128560 goodwill resulted business acquisition recorded loss impairment assets financial statement note 5 prepaid expense april 15 2002 company signed agreement min duk hyun consultant consulting service consultant consult company identifying locating acquiring various business opportunities company period two years april 15 2004 company issued 3000000 shares common stock consultant valued 1620000 based upon market value stock time consummation agreement company recorded shares issued consultant prepaid fees net amortization 168751 period april 15 2002 june 30 2002 note 6 investments investment clearpass company entered letter intent provide funding 10000000 minimum 33 equity clearpass manufacturing company bio sensor mouse pads related equipment company invested 15000 fiscal year ended june 30 2002 amount reflected investment financial statements june 30 2002 investment slimtech pursuant stock acquisition purchase agreement acquisition agreement april 30 2002 company exchanged 3000000 shares newly issued common stock exchange 10200000 shares common stock slimtech inc nevada corporation constitutes approximately 57 interest slimtech inc acquisition approved unanimous written consent board directors june 14 2002 investment recorded market value shares issued company resulting goodwill 128560 june 30 2002 company wrote recorded value goodwill based upon reevaluation june 30 2002 investment providential technology inc company purchased less 10 percent outstanding shares providential technology inc corporation engaged software development financial service providers company provided initial funding 165000 providential technology develop markettiming program online trading platform equities projects discontinued october 2000 due lack additional funding investment recorded value funds invested corporation written accompanying financials note 7 marketable equity securities available sale following summary marketable equity securities classified available sale cost basis fair value gross unrealized loss marketable securities 637009 120000 517009 changes net unrealized holding loss securities available sale included separate component stockholders equity twelve months ended june 30 2002 year ended june 30 2001 366820 28869 respectively note 8 property equipment property equipment june 30 2002 consist following furniture equipment 107005 automobiles 81103 188108 less accumulated depreciation 135650 net 52458 company depreciates furniture equipment automobiles straightline basis estimated useful life 5 years depreciation amortization expense 30317 132950 twelve ended june 30 2002 2001 respectively june 22 2001 company completed sale corporate office building company recognized gain net broker escrow fees 551179 sale company currently leases office space new owners 4263 per month note 9 due officer due officer represents advances made officer company noninterest bearing unsecured due demand note 10 convertible promissory notes company issued convertible promissory notes march april 2000 amounting 1350000 plus interest due september 28 2000 400000 plus interest due october 21 2000 notes essentially demand notes sixmonth term bear interest 8 annually unless notes default instance interest rate increase 12 annually notes bear redemption premium based upon date redemption equal 5 within first 60 days 10 within second 60 days 15 within third 60 dayperiod 20 redeemed 181 days 180th day company require holders convert registration statement effect notes common stock 180th day holders elect convert right company force conversion time second anniversary remaining notes automatically covert common stock registration statement effect conversion direction company addition redemption amount company would also owe 20 per annum rate return redemption amount notes may paid tender common stock company conversion rate issuance common stock equal “closing price date initial purchase notes average closing bid price five previous trading days repricing warrants also issued contemporaneous amounts decrease trading price stock entitle note holders reset exercise price lower price existed closing date number shares issued repricing warrants directly linked companys stock price conversion date notes stock price decreases number shares issued pursuant repricing warrants increase note purchasers also entitled separate set warrants equal 20 total purchase amounts notes acquired allowing exercise price 110 closing price 5year term accepting subscriptions convertible notes company agreed file registration statement respect companys common stock issued upon conversion notes exercise warrants initial filing occur within 60 days “first closing occurred march 28 2000 2 per month penalty accrue registration statement declared effective prior 181st day following first closing holders right require repayment cash registration statement effect 181st day since registration statement filed within first 60 days first closing declared effective within 181 days first closing note holders right 2 penalty repayment cash company paid notes date report also owe note holders 12 default rate 20 redemption premium noted year ended june 30 2002 225000 notes accrued interest fees 183695 totaling 408695 converted 170288 shares companys common stock market value stock issued conversion calculated 25240 gain 383455 resulted note conversion recorded extraordinary gain financial statements note 11 accrued expenses accrued expenses june 30 2002 consist following accrued accounts payable 560193 accrued salaries payroll tax 31508 accrued interest 1863374 accrued legal 1116077 accrued expenses 125020 total 3696172 note 12 minority interest minority interest slimtech computed follows total assets shares phi 300000 total liabilities 3300 net worth 296700 minority shares 4333 128560 note 13 litigation legal proceedings settled unpaid june 30 2002 quang van cao nhan thi nguyen cao vs providential securities inc et al case originally submitted orange county superior court ca june 25 1997 case 781121 subsequently moved nasd dispute resolution arbitration august 24 2000 companys legal counsel negotiated claimants counsel unilaterally reached settlement approved company process renegotiating terms said settlement claimants filed request arbitration hearing national association securities dealers october 4 2000 case 9903160 thereafter claimants filed complaint orange county superior court ca october 31 2000 case 00cc13067 alleged breach contract damages sum 7500000 plus prejudgment interest costs incurred connection complaint relief without admitting denying allegations company reached settlement agreement claimants whereby company would pay claimants total 6250000 plus 450000 administrative costs date report company paid 2500 subject entry judgment 79000 settlement amount accrued accompanying consolidated financial statements conseco finance vendor services corporation fka green tree vendor services corporation vs providential securities inc henry fahman tina phan september 1997 providential securities inc entered written lease agreement lease certain items equipment green tree vendor services return providential securities inc agreed pay thirtysix monthly installments amount 155201 september 12 2000 subsequently providential securities inc unable make monthly payments claimant due lack revenues following interruption subsequent closure securities brokerage operations claimant filed complaint money superior court state california county orange case 01cc02613 february 23 2001 seeking 3910250 plus interest thereon legal rate september 12 2000 claimant entered judgment providential securities inc henry fahman tina phan 48933 judgment amount accrued accompanying consolidated financial statements imperial business credit inc vs providential securities inc tina phan timothy dack fahman theodore dack fahman henry dack fahman november 20 1997 nara bank na providential securities inc entered written lease agreement wherein nara bank na agreed lease certain computer equipment providential securities inc thereafter agreement assigned nara bank na claimants assignor oak financial services thereafter agreement assigned claimants assignor claimant pursuant terms agreement providential securities inc agreed pay nara bank na sum 118740 per month sixty months september 15 2000 subsequently providential securities inc unable make monthly payments claimant due lack revenues following interruption subsequent closure securities brokerage operations see note 16 claimant filed complaint money superior court state california county orange case 01cc07697 june 14 2001 seeking 3087340 plus interest thereon rate ten percent 10 per annum september 15 2000 case settled december 17 2001 however since providential securities inc unable pay settlement amount claimant entered judgment 79681 january 232002 subsequently 12000 paid mr fahman unpaid judgment amount accrued accompanying consolidated financial statements time warner communications vs providential securities inc case filed superior court california county orange claimant amounts due connection advertising performed behalf providential securities inc case settled 7500 july 12 2001 settled amount accrued accompanying consolidated financial statements arbitration cases arbitration case brought richard shaffer providential securities inc closed year ended june 30 2002 total claim requested claimant 100000 plus interest denied amount recorded gain legal settlement financial statements since amount accrued prior period arbitration case tam never filed prior years accrued expense 40000 reversed amount recorded gain legal settlement pending litigation coffin communications group vs providential holdings inc february 19 2002 coffin communications group filed complaint superior court california county los angeles limited jurisdiction company case 02e01535 8500 plus prejudgment interest attorneys fees costs relief claim connection investor relations services rendered coffin communications group company intends settle case sought amount 8500 excluding interest accrued accompanying consolidated financial statements dow jones company inc vs providential securities inc providential holdings inc march 19 2002 dow jones company filed complaint superior court california county orange west justice center case 02wl1633 providential securities inc discontinued operations company providential holdings inc 997310 plus prejudgment interest rate ten 10 per annum november 1 2000 reasonable attorneys fees relief claim connection services allegedly rendered plaintiff providential securities inc prior november 2000 company intends settle case sought amount 997310 excluding interest accrued expenses accompanying consolidated financial statements francis vause mark vause francis vause jr ian vause margaret hodson vs jersey transfer trust company providential holdings inc claimants filed complaint united states district court district new jersey case 004353jagf september 6 2000 seeking damages 50000000 jersey transfer trust company providential holdings inc refusing remove restrictive legends register total 568332 shares rule 144 stock held claimants providential holdings inc jersey transfer trust company defendants relied representation former management jr consulting inc later changed providential holdings inc captioned shares free encumbrances issued invalid consideration defendants vigorously defending case crossclaimed appropriate former management jr consulting inc sought amount 500000 accrued accompanying consolidated financial statements james c hu vs mingman hu providential securities inc mingman hu registered representative providential securities inc served claimants investment account claimant filed complaint los angeles county superior court northeast district april 27 2001 case g0027156 seeking compensatory damages amount 1160911 plus 12 interest emotional distress damages excess 5000000 mingman hus failure honor written agreement claimant mingman hu independent contractor providential securities inc responsible alleged claims claimant providential securities inc vigorously defend case sought amount 61609 excluding interest accrued accompanying consolidated financial statements lawrence nguyen vs henry fahman providential holdings inc hung nguyen aka tony nguyen december 19 2000 henry fahman executed demand promissory note pledged 1049600 shares common stock providential holdings inc personal loan amount 15000000 claimant note amended february 22 2001 mature march 19 2001 henry fahman repaid 2500000 claimant requested extension repayment said note july 15 2001 agreed claimant guaranteed mr derek nguyen mutual friend claimants henry fahmans may 31 2001 claimant filed complaint superior court california county orange central justice center case 01cc07055 seeking 12500000 plus interest highest rate allowed law december 19 2000 attorney fees costs exemplary punitive damages ownership pledged shares common stock providential holdings inc henry fahman committed repaying personal obligation claimant company accrued amount relating case accompanying consolidated financial statements ngon vu vs providential securities inc claimant former employee providential securities inc laid 2000 due closure business claimant complained department industrial relations dir allegedly unpaid vacation salaries june 13 2001 dir filed request enter judgment providential securities inc 907364 including wages interest penalty post hearing filing fee providential securities inc appealing request judgment sought amount 9074 accrued accompanying consolidated financial statements mark tow esq vs providential holdings inc case prearbitration company hired mark tow esq prepare sb2 registration statement prepaid 25000 retainer mark tow unable complete work according schedule company hired stradling yocca carson rauth replace mark tow stradling yocca carson rauth completed sb2 registration statement filed sec 9282000 mark tow sent company letter june 2001 seeking total 7500000 allegedly rendered service company intends vigorously defend case company accrued 50000 relating case accrued expenses accompanying consolidated financial statements since original agreement mark tow total service fee 75000 company already paid 25000 retainer offset total fees arbitration cases company several arbitration cases either pending preliminary stages providential securities inc relating day trading operations company intends defend matters vigorously may enter settlement appropriate based specific allegations involved potential cost defend matter total amount damages sought claimants cases 131850 amount accrued accompanying consolidated financial statements note 14 income taxes companys income tax provision current year represents mandatory state taxes corporation penalties interest relating late payments reconciliation income tax expense benefit computed us federal statutory rate income tax expense benefit follows june 30 2002 june 302001 tax us federal statutory rates 421400 683600 state income taxes net federal effect 74400 120600 change valuation allowance 495800 809723 5523 income tax 800 year ended june 30 2002 represents minimum franchise tax state california june 30 2002 companys deferred tax asset amounted approximately 45 million relates primarily nol carryforwards deferred tax asset year related valuation allowance amount company significant deferred tax liabilities june 30 2002 june 30 2002 company estimated available nol carryforwards approximately 113 million subject certain limitations expire various dates 2022 company failed file federal state tax returns june 30 2002 june 30 2001 note 15 basic diluted net loss per share net loss per share calculated accordance sfas 128 “earnings per share provision sfas 128 basic net loss per share computed dividing net loss period weightedaverage number common shares outstanding period diluted eps based weightedaverage number shares common stock outstanding period common stock equivalents outstanding end period common stock equivalents excluded calculation weightedaverage shares purposes calculating diluted net loss per share 2002 2001 periods inclusion antidilutive basic diluted net loss per share numerator net loss 1239543 2015644 denominator basic diluted weighted average number common shares outstanding period 28648000 27323000 basic diluted net loss per share 004 007 note 16 issuance stock series class convertible cumulative preferred stock year ended december 31 1999 providential securities inc placed subscription offering newly authorized series class preferred stock 10000000 shares authorized 103000 shares issued 500 per share holders series class convertible cumulative preferred stock entitled receive cumulative cash dividend rate 12 per year accrued quarterly dividends including accumulated unpaid dividends shall paid preferred stock dividends paid holders companys common stock share preferred stock convertible one share common stock company time two years date issue immediately prior companys initial public offering whichever event occurs first company may redeem preferred stock price equal 120 percent par value said preferred stock plus accumulated unpaid dividends time two years date issuance giving investor opportunity written notice convert investment common stock accrued dividends included current liabilities june 30 2002 june 30 2001 111055 57055 respectively year ending june 30 2001 company redeemed 13000 outstanding shares preferred stock exchange principal plus unpaid dividends required nasd settlement litigation settlement common stock november december 2000 company issued 118 million shares common stock treasury stocks issued par value 04 per share total amount 472000 year ended june 30 2002 company issued 170288 shares common stock conversion notes difference 383455 notes amounting 225000 accrued interest fees 183695 exchanged stock valued market price 25240 recorded extraordinary gain stock valued market price stock time conversion notes year ended june 30 2002 company issued 3000000 shares common stock consulting service amounting 1620000 valued price stock time issuance stock addition 710000 shares common stock issued consulting services amounting 183600 company issued 3000000 shares common stock acquisition slimtech recorded 300000 shares issued subsidiary reflected treasury stock financial statements note 17 stock based compensation plan july 10 2000 company adopted stock option incentive plan provides issuance maximum 16 million shares companys common stock officers employees nonemployee directors sole discretion board directors august 10 2000 company granted 14 million options plan officers directors employees exercise price 50 per share options exercisable july 1 2001 expire december 31 2002 date report options exercised seven million options forfeited company complies accounting principles board opinion 25 accounting stock issued employees accounting options issued employees compensation expense recorded compensation costs companys stock option plan determined based upon fair value grant date consistent statement financial accounting standards 123 sfas 123 “accounting stockbased compensation companys net loss per share june 30 2001 would follows net loss reported 2015644 net loss pro forma 7265484 loss per share reported 007 loss per share pro forma 027 weighted average fair value options granted year ending june 30 2001 37 fair value option grant estimated date grant using blackscholes option pricing model following assumptions used grants fiscal year 2001 riskfree rate 60 percent expected dividend yield expected volatility 540 percent expected life 24 years note 18 contracts commitments agreement datalogic consulting inc datalogic consulting inc texas corporation consulting firm sas institute quality partner company assisted datalogic connection merger plan topclick international inc development strategies april 25 2001 effective april 18 2001 datalogic consulting inc company entered agreement whereby company would receive 10 equity new company would result consummation proposed merger datalogic consulting inc topclick international inc merger plan datalogic toplick consummated july 20 2001 company entitled 2666922 shares datalogic international inc new name topclick international inc fee merger acquisition consulting services performed company received 12 million shares june 30 2002 investment datalogic international inc carried financial statements providential holdings inc market value june 30 2002 joint venture agreement mimi ban november 27 2001 effective november 23 2001 company signed joint venture agreement mimi ban individual whereby mimi ban would transfer liquid crystal display lcd technologies providential purpose setting operating one lcd manufacturing plants vietnam according joint venture agreement mimi ban share 30 providential holdings inc share 60 business partners investors including htv co ltd share 10 net profits generated lcd plants established vietnam elsewhere result agreement joint venture agreement supersedes prior agreements arrangements covenants including limited joint venture agreement boxo inc company dated january 4 2001 letter intent boxo inc company dated december 20 2000 amendment thereof date report manufacturing plants operating setup international center training consulting vietnams ministry trade international center training consulting ictc organization ministry trade vietnam promotes economics trade investment training activities vietnam foreign organizations providential holdings inc ictc signed agreement march 2001 cooperate areas trade economics technology ictc responsible representing providential holdings connection appropriate vietnamese organizations businesses individual businessmen investors vietnam ictc also perform consulting services provide information various economic trade investment projects may required providential fees parties negotiated project basis date report ictc introduced vietnambased delta electromechanis co ltd manufacturer electric bicycles nam hiep co ltd manufacturer organic fertilizer construction company phi potential joint venture partners however projects completed chu lai industrial zone quang nam province vietnam providential holdings entered agreement chu lai industrial zone cliz authority quang nam province central vietnam develop industrial export processing zone upgrade paper mill implement two five investment projects chu lai end 2002 date report company assisted funding project company expects main role project manager organizing different companies operate business location date report company assisted funding project provimex wholly owned division company originally formed april 10 2001 name “providential imex focus trade commerce vietnam division changed name provimex july 5 2001 company believes trade commerce business grow substantially result ratification trade agreement vietnam united states company begun generate revenues division since august 2002 providential advisory services inc providential advisory services inc pas formed february 2000 california corporation mission create distinctive value enrich clients lives providing high quality investment advisory services help improve asset value time company purchased 60 percent outstanding shares entity july 2001 1000 date report corporation sales cost sales gross profit agreement lexor international inc october 9 2001 company entered agreement provide merger acquisition consulting services lexor international inc maryland corporation assist lexor business combination plan business combination plan panamerican automotive corporation delaware corporation according agreement company receiving 10 equity interest resulting company compensation advisory consulting services october 22 2001 panamerican signed definitive agreement acquire 100 lexor exchange stock panamerican transaction closed november 5 2001 november 15 2001 company received 24761900 restricted shares panamerican automotive corporations common stock 7 1 reverse split company recorded shares value equity line credit company received 20 million equity line credit beginning november 2001 bostonbased dutchess private equities fund lp line credits term three years equity line credit terminated june 2002 company unable file registration statement timely manner funds received line credit joint venture minh hieu company january 1 2002 company entered agreement minh hieu joint stock company ho chi minh city vietnam form “providential jvc joint venture company laws socialist republic vietnam according terms agreement company contribute 140000 initial required capital 70 providential jvc minh hieu company contribute 60000 30 joint venture enterprise providential jvcs main line business includes industrial garments packaging products accessories date amount contributed towards joint venture office space lease company currently leases office space paub enterprises llc 4263 per month lease commenced april 1 2001 expires march 31 2004 equipment leases company also unable make monthly payments equipment leases due lack revenues following interruption subsequent closure securities brokerage operations company litigation equipment lessors negotiating additional payoffs equipment lessors note 19 going concern uncertainty shown accompanying consolidated financial statements company incurred net loss 12 million year ended june 30 2002 june 30 2002 company negative working capital 67 million shareholder deficit 52 million since main operating subsidiary providential securities inc ceased securities brokerage operations october 2000 significant revenue stream company default terms convertible notes june 30 2002 factors well uncertain conditions company faces daytoday operations create uncertainty companys ability continue going concern financial statements include adjustments might necessary company unable continue going concern management taken action formulating additional plans strengthen companys working capital position generate sufficient cash meet operating needs june 30 2003 beyond among actions taken company intends file form sb2 registration statement raise additional capital currently process attaining additional financing addition company also anticipates generating revenue proposed mergers acquisitions see notes 18 assurances made management successful achieving plan note 20 subsequent event subsequent june 30 2002 company issued 2532057 shares common stock converted notes exercise repricing warrants july 2002 company received decision nasd arbitration mohammad bagherabadi case dismissed without prejudice company liable fee 3100 june 30 2002 company accrued 81850 july 2002 company secured 10 million equity line credit los angelesbased mercator momentum fund lp line credits term three years amount company receive dependent amount free trading shares put escrow account effective registration statement company draw 90 percent market price defined agreement registered shares freetrading shares deposited escrow company agrees pay 2 percent fee total value equity line 1 percent payable cash gross proceeds first drawdown remaining 1 percent fee payable shares companys common stock date report funds received line credit august 23 2002 company entered purchase agreement atc technology corporation arizona corporation purchase issued outstanding shares atc technology corporation consideration company agreed deliver 250000 promissory note noninterest bearing payable 270 days closing 250000 promissory note noninterest bearing payable 18 months closing 3000000 shares restricted stock company option additional shares issued 270 days stock price reach 30 1000000 shares restricted stock company option additional shares issued one year stock price reach 30 item 8 item 7 managements discussion analysis financial condition results operations except audited historical information contained herein report specifies forwardlooking statements management company within meaning section 27a securities act 1933 section 21e securities exchange act 1934 forwardlooking statements including without limitation forwardlooking statements regarding companys expectations beliefs intentions future strategies forwardlooking statements estimate happening future events based historical facts forward looking statements may identified use forwardlooking terminology could may expect shall estimate anticipate probable possible continue intend similar terms variations terms negative terms forwardlooking statements specified report compiled management company basis assumptions made management considered management reasonable future operating results company however impossible predict representation guaranty warranty inferred forwardlooking statements assumptions used purposes forwardlooking statements specified report represent estimates future events subject uncertainty possible changes economic legislative industry circumstances result identification interpretation data information use developing selecting assumptions among reasonable alternatives require exercise judgment extent assumed events occur outcome may vary substantially anticipated projected results accordingly opinion expressed achievability forwardlooking statements addition forwardlooking statements compiled date report evaluated consideration changes occurring date report assurance given assumptions relating forwardlooking statements specified report accurate company assumes obligation update forwardlooking statements results operations years ended june 30 2010 june 30 2009 revenues company generated net revenue 83990 consulting advisory services year ended june 30 2010 compared 2006220 year ended june 30 2009 represented 9582 decrease consulting advisory revenue decrease mainly due decrease size scope merger acquisition activities current year operating expenses company incurred total operating expenses 1420583 year ended june 30 2010 compared 1595009 year ended june 30 2009 represents 1094 decrease operating expenses prior year decrease primarily due decrease professional services general administrative expenses relative decrease consulting advisory services company’s professional fees decreased 4462 332192 year ended june 30 2010 compared 599804 prior year mainly due decrease consulting service accounting fees consulting fees decreased 3453 374851 prior year 245446 current year accounting fees decreased 83 93600 prior year 15600 current year net income loss operations company net loss operations 1336594 year ended june 30 2010 compared net income 411211 year ended june 30 2009 mainly due 9582 decrease consulting advisory revenue 1094 decrease operating expenses current fiscal year decrease operating expenses primarily due decrease professional expenses general administrative expenses current fiscal year net income company net loss 3651120 year ended june 30 2010 compared loss 8322041 year ended june 30 2009 fiscal year ended june 30 2010 loss recorded loss marketable securities compared loss 4018965 year ended june 30 2009 company also recorded loss debt settlement 2701 year ended june 30 2010 compared gain debt settlement 187794 year ended june 30 2009 interest expenses decreased 507397 year ended june 30 2010 compared 586468 company recorded impairment marketable securities amount 1750000 year ended june 30 2010 compared 4061715 year ended june 30 2009 impairment loan receivable 109600 year ended june 30 2010 compared 282148 year ended june 30 2009 net loss based basic diluted weighted average number common shares outstanding year ended june 30 2010 002 compared 004 year ended june 30 2009 liquidity capital resources must continue raise capital fulfill plan acquiring companies assisting development internally company expects working capital cash requirements next 12 months generated operations additional financing cash equivalents 75301and 37813 june 30 2010 june 30 2009 respectively operating activities used 119773 cash year ended june 30 2010 compared negative 550329 year ended june 30 2009 cash used investing activities 208144 compared cash provided 575127 year ended june 30 2010 2009 respectively years ended june 30 2010 2009 company received 47442 268840 respectively sale marketable securities company spent 1165 25292 purchase marketable securities years ended june 30 2010 2009 respectively company incurred loss 34355 investments catalyst resource group formerly jeantex group year ended june 30 2010 company spent 000 35792 purchase fixed assets fiscal year ended june 30 2010 2009 respectively cash provided financing activities 126618 1046103 years ended june 30 2010 2009 respectively year ended june 30 2010 primarily proceeds notes including borrowing officers amount 208992 unrelated parties amount 221326 offset total payments notes amounting 436889 year ended june 30 2009 proceeds notes totaled 637600 borrowings officers totaled 491934 reduced payments notes amounting 214198 purchase treasury shares 4233 short term notes payable june 30 2010 2009 company short term notes payable amounting 2400546 2310085 accrued interest 913235 466387 respectively notes bear interest rates ranging 6 36 per annum 1716500 short term notes past due 759730 due demand june 30 2010 year ended june 30 2010 2009 company paid 130865 167485 principal 68395 200135 interest short term notes payable secured assets company summarized note balance secured 115000 400000 catalyst resource group shares 500000 catthai corp shares 550000 35000 cavico corp shares 500000 catthai corp shares 150000 1500000 phi mining group shares 100000 1500000 phi mining group shares due preferred stockholders company classified 215000 preferred stock previously subscribed one subsidiaries current liability payable holders preferred stock due non compliance preferred shares subscription agreement amount past due june 30 2010 company made 5000 interest payment year ended june 30 2007 interest payable holders preferred stock 43455 included accrued interest included account payable accrued expenses balance sheet june 30 2010 current liabilities year ended june 30 2004 company received overpayment 89691 exercise stock options amount paid company june 30 2010 classified payable included current liabilities companys plan operation next 12 months primary scope business consists mergers acquisitions merger acquisition advisory services real estate development hospitality healthcare services mining investments special situations potential high growth next twelve months company intends emphasize advisory services small midsized companies us pacific rim focus development real estate program chu lai central vietnam housing hanoi ho chi minh city philand ranch limited develop mining business phi mining group inc pursue oil gas development opportunities providential energy corporation engage special situations may create value company’s shareholders guaranty company successful plans financial plans management taken action formulating additional plans strengthen companys working capital position generate sufficient cash meet operating needs june 30 2010 beyond among actions taken company intends raise additional capital us international markets currently process attaining additional financing addition company also anticipates generating revenue proposed mergers acquisitions assurances made management successful achieving plan item 7a item 7 management’s discussion analysis financial condition results operations except audited historical information contained herein report specifies forwardlooking statements management company within meaning section 27a securities act 1933 section 21e securities exchange act 1934 “forwardlooking statements” including without limitation forwardlooking statements regarding company’s expectations beliefs intentions future strategies forwardlooking statements estimate happening future events based historical facts forward looking statements may identified use forwardlooking terminology “could” “may” “will” “expect” “shall” “estimate” “anticipate” “probable” “possible” “should” “continue” “intend” similar terms variations terms negative terms forwardlooking statements specified report compiled management company basis assumptions made management considered management reasonable future operating results company however impossible predict representation guaranty warranty inferred forwardlooking statements assumptions used purposes forwardlooking statements specified report represent estimates future events subject uncertainty possible changes economic legislative industry circumstances result identification interpretation data information use developing selecting assumptions among reasonable alternatives require exercise judgment extent assumed events occur outcome may vary substantially anticipated projected results accordingly opinion expressed achievability forwardlooking statements addition forwardlooking statements compiled date report evaluated consideration changes occurring date report assurance given assumptions relating forwardlooking statements specified report accurate company assumes obligation update forwardlooking statements results operations years ended june 30 2018 june 30 2017 revenues company generated 1672659 revenues sales consulting advisory management services fiscal year ended june 30 2018 compared 113500 revenue year ended june 30 2017 increase 1559159 total revenues two periods due increases sales 432000 advisory fees 1127159 operating expenses company incurred total operating expenses 1902966 year ended june 30 2018 compared 670458 year ended june 30 2017 represents increase 1232508 18383 total operating expenses prior year increase due increase 1196900 professional services primarily related setup luxembourg institutional bank fund increase 35816 general administrative expenses two fiscal years income loss operations company loss operations 230307 fiscal year ended june 30 2018 compared loss operations 556958 fiscal year ended june 30 2017 represents decrease 326651 5865 loss operations current fiscal year compared precious year mainly due fact company generated revenues simultaneously incurring comparably expenses connection setup luxembourg institutional bank fund fiscal year ended june 30 2018 income expense company net expense 1796013 fiscal year ended june 30 2018 compared net expense 1003760 prior year primarily due fact company increase interest expense 826174 increase expense 2624386 loss sale assets marketable securities current fiscal year net income loss company net loss 2026320 fiscal year ended june 30 2018 compared net loss 1560718 prior year representing increase 465603 net loss two fiscal years net loss per share based basic diluted weighted average number common shares outstanding fiscal year ended june 30 2018 003 compared 010 fiscal year ended june 30 2017 cash flows 13937 cash equivalents june 30 2018 compared 38369 cash equivalents june 30 2017 respectively net cash used operating activities 1955640 fiscal year ended june 30 2018 compared net cash used operating activities 6924748 fiscal year ended june 30 2017 respectively underlying reasons decrease net cash used operating activities two periods mainly due increase net loss operations 465602 increase 962789 assets prepaid expenses current fiscal year compared previous fiscal year offset increase accrued expenses 6396999 two periods net cash used investing activities 25702841 fiscal year ended june 30 2018 compared cash provided investing activities 224688 fiscal year ended june 30 2017 respectively underlying reasons change net cash provided used investing activities two fiscal years primarily due 25 million acquisition mineral assets american pacific resources inc subsidiary company investment aquarius power inc amount 5000 recognition 697841 contract liability connection service agreement clientpartner fiscal year ended june 30 2018 net cash provided financing activities 27634050 fiscal year ended june 30 2018 compared cash provided financing activities 6735447 fiscal year ended june 30 2017 respectively underlying reasons increase cash provided financing activities current fiscal year primarily due demand promissory note issued purchase mining claims oregon american pacific resources inc change common stock 2596453 current fiscal year compared prior fiscal year historical financing arrangements short term notes payable issuance common stock course business company obtained shortterm loans individuals institutional investors time raised money issuing restricted common stock company auspices rule 144 notes bear interest rates ranging 0 36 per annum notes 11 15 convertible promissory notes company also time issued convertible promissory notes various private investment funds shortterm working capital special projects typically notes bear interest rates 5 12 per annum mature within one year convertible common stock company discount ranging 42 50 may repaid within 180 days prepayment premium ranging 130 150 note 11 company’s plan operation following 12 months next twelve months company intends focus completing establishment deployment contemplated institutional bank fund luxembourg together number subfunds investing number selective industries well developing asia diamond exchange vietnam addition company continues carry merger acquisition program acquiring controlling interests certain target companies also plans invest special situations may potentially generate significant revenues profitability company short term moreover also provide advisory consulting services international clients wholly owned subsidiary phi capital holdings inc financial plans material cash requirements must raise substantial amounts capital fulfill plan acquiring energyrelated natural resource assets well investing special situations part scope business intend use equity debt project financing meet capital needs acquisitions investments management taken action formulated plans meet company’s operating needs june 30 2019 beyond working capital cash requirements next 12 months expected generated operations sale marketable securities additional financing company plans generate revenues consulting services merger acquisition advisory services acquisitions target companies cash flows available future financing arrangements company may use various sources funds including shortterm loans longterm debt equity capital project financing may necessary company believes able secure required capital implement business plan equity line facility march 6 2017 phi group inc nevada corporation “company” azure capital massachusetts corporation “investor” entered investment agreement “investment agreement” registration rights agreement “registration rights agreement” dated march 6 2017 company investor pursuant investment agreement investor committed purchase subject certain restrictions conditions 10000000 worth company’s common stock period 36 months effectiveness registration statement registering resale shares purchased investor pursuant investment agreement company agreed initially reserve 20000000 shares common stock issuance investor pursuant investment agreement event company cannot register sufficient number shares common stock issuance pursuant investment agreement company use best efforts authorize reserve issuance number shares required company perform obligations connection investment agreement soon reasonable practical company may discretion draw facility time company determines appropriate accordance terms conditions investment agreement maximum number shares company entitled put investor one draw notice shall exceed shares purchase price 250000 200 average daily volume us market company’s common stock three 3 trading days prior applicable put notice date multiplied average three 3 daily closing prices immediately preceding put date calculated accordance investment agreement company may deliver notice subsequent put time pricing period prior put completed purchase price shall set ninetyfour percent 94 lowest daily volume weighted average price vwap company’s common stock five 5 consecutive trading days immediately following put notice date put notice submitted investor company shall specify suspension price put event price company’s common stock falls suspension price put shall temporarily suspended put shall resume time price company’s common stock suspension price provided dates pricing period particular put still valid event pricing period complete shares suspension price due investor shall sold investor company suspension price terms investment agreement suspension price put may changed company submitted investor put restrictions applied days draw notice date closing date respect particular put time company shall entitled deliver another draw notice addition investor obligated purchase shares investor’s total number shares beneficially held time would exceed 499 number shares company’s common stock determined accordance rule 13d1j securities exchange act 1934 amended addition company permitted draw facility unless effective registration statement cover resale shares investment agreement also contains customary representations warranties parties assertions embodied representations warranties made purposes investment agreement subject qualifications limitations agreed parties connection negotiating terms investment agreement investment agreement provides company investor entitled customary indemnification among things losses liabilities may suffer result breach party provisions investment agreement registration rights agreement defined investor read investment agreement together information concerning company publicly files reports statements securities exchange commission “sec” pursuant terms registration rights agreement company obligated file one registrations statements sec within twentyone 21 days date registration rights agreement register resale investor shares common stock issued issuable investment agreement addition company obligated use commercially reasonable efforts registration statement declared effective sec within 90 days registration statement filed investment agreement amended august 3 2017 allow reservation 65445000 shares company’s common stock issuance investor pursuant corrected investment agreement company filed s1 registration statement securities exchange commission include 7936600 shares common stock issuance connection first tranche equity line facility s1 registration statement amended declared effective securities exchange commission january 11 2018 day report company accessed equity line facility funding item 7a item 7 management’s discussion analysis financial condition results operations except audited historical information contained herein report specifies forwardlooking statements management company within meaning section 27a securities act 1933 section 21e securities exchange act 1934 “forwardlooking statements” including without limitation forwardlooking statements regarding company’s expectations beliefs intentions future strategies forwardlooking statements estimate happening future events based historical facts forward looking statements may identified use forwardlooking terminology “could” “may” “will” “expect” “shall” “estimate” “anticipate” “probable” “possible” “should” “continue” “intend” similar terms variations terms negative terms forwardlooking statements specified report compiled management company basis assumptions made management considered management reasonable future operating results company however impossible predict representation guaranty warranty inferred forwardlooking statements assumptions used purposes forwardlooking statements specified report represent estimates future events subject uncertainty possible changes economic legislative industry circumstances result identification interpretation data information use developing selecting assumptions among reasonable alternatives require exercise judgment extent assumed events occur outcome may vary substantially anticipated projected results accordingly opinion expressed achievability forwardlooking statements addition forwardlooking statements compiled date report evaluated consideration changes occurring date report assurance given assumptions relating forwardlooking statements specified report accurate company assumes obligation update forwardlooking statements results operations years ended june 30 2014 june 30 2013 revenues company generated 77430 revenues consulting advisory management services fiscal year ended june 30 2014 compared zero revenue year ended june 30 2013 operating expenses company incurred total operating expenses 381482 year ended june 30 2014 compared 403311 year ended june 30 2013 represents decrease 21829 541 total operating expenses prior year decrease primarily due decrease 47780 professional services offset increase 3877 salaries wages increase 22589 general administrative expenses company utilized less thirdparty professional services incurred additional 15929 travel expenses additional 3611 transfer agent service current year relative previous fiscal year income loss operations company loss operations 304043 fiscal year ended june 30 2014 compared loss operations 403310 year ended june 30 2013 represents decrease 99268 2461 loss operations current year compared precious year mainly due fact company generated 77439 revenues fiscal year ended june 30 2014 generate revenue fiscal year ended june 30 2013 due decrease 21829 541 total operating expenses compared prior year income expense company net income 48048 year ended june 30 2014 compared net expenses 480737 prior year primarily due fact company incurred 156255 less interest expenses current year compared previous year time recognized 372278 gain settlement debts year ended june 30 2014 compared zero gain settlement debts year ended june 30 2013 company incurred 323782 interest expenses fiscal year ended june 30 2014 480037 interest expenses fiscal year ended june 30 2013 respectively net income loss company net loss 255994 year ended june 30 2014 compared net loss 884047 year ended june 30 2013 company recorded loss sale marketable securities 30 fiscal year ended june 30 2014 compared loss sale marketable securities 700 previous fiscal year interest expenses 323782 fiscal year ended june 30 2014 compared 480037 fiscal year ended june 30 2013 decrease 628052 7104 net loss year ended june 30 2014 compared previous year primarily due 372278 gain settlement debts year ended june 30 2014 compared zero gain settlement debts year ended june 30 2013 reasons mentioned sections pertaining revenues operating expenses income loss operations income expense net loss based basic diluted weighted average number common shares outstanding year ended june 30 2014 004 compared 636 year ended june 30 2013 cash flows 30623 cash equivalents june 30 2014 compared zero balance cash equivalents june 30 2013 respectively net cash used operating activities 979676 fiscal year ended june 30 2014 compared net cash used operating activities 89118 fiscal year ended june 30 2013 respectively underlying reasons changes net cash used operating activities two periods mainly due decrease 1184195 liabilities discontinued operations decrease 127756 shortterm notes payable decrease 77750 accrued interest offset increase 413724 shortterm liability officer current fiscal year compared previous fiscal year net cash provided investing activities 99160 fiscal year ended june 30 2014 compared cash provided investing activities 5393 year ended june 30 2013 respectively underlying reason increase net cash provided investing activities two fiscal years primarily due receipts discontinued operations 99160 year ended june 30 2014 compared receipt discontinued operations proceeds sales marketable securities 14300 purchase marketable securities 8907 year ended june 30 2013 respectively net cash provided financing activities 911139 fiscal year ended june 30 2014 compared cash provided financing activities 83724 fiscal year ended june 30 2013 respectively underlying reason increase cash provided financing activities current fiscal year mainly due decrease minority interest 704205 increase 294690 proceeds sale common stock company current fiscal year offset payments notes payable 127756 compared lesser amounts prior fiscal year historical financing arrangements short term notes payable issuance common stock course business company obtained shortterm loans individuals institutional investors time raised money issuing restricted common stock company auspices rule 144 described note 14 stockholder equity june 30 2014 2013 company shortterm notes payable amounting 1298700 1426456 accrued interest 2874509 2952261 respectively notes bear interest rates ranging 6 36 per annum years ended june 30 2014 2013 company paid 127755 764500 principal 89440 46545 interest shortterm notes respectively notes payable secured assets company summarized due preferred stockholders company classified 215000 preferred stock previously subscribed one long discontinued subsidiaries current liability payable holders preferred stock subsidiary due deficiencies connection preferred share subscription agreements amount past due june 30 2014 last interest payment 5000 made company year ended june 30 2007 interest payable holders preferred stock abovementioned discontinued subsidiary amounts 361655 335855 included accrued interest included account payable accrued expenses balance sheet june 30 2014 june 30 2013 company’s plan operation following 12 months current scope business primarily focuses energy natural resources continues provide corporate finance project financing including merger acquisition advisory consulting services subsidiary phi capital holdings inc following twelve months commencing june 30 2014 company would continue investigate opportunities energyrelated natural resource assets acquisition develop new business areas corporate finance project financing company would also actively pursue opportunities international trade develop growing network potential buyers suppliers energyrelated natural resource products however guarantee could made company would successful plans time frame financial plans material cash requirements must raise substantial amounts capital fulfill plan acquiring energyrelated natural resource assets part scope business intend use equity debt project financing meet capital needs acquisitions management taken action formulated plans strengthen company’s working capital position generate sufficient cash meet operating needs june 30 2015 beyond working capital cash requirements next 12 months following end current fiscal year would generated operations sale marketable securities additional financing company expects generate revenues consulting services merger acquisition advisory services trading activity joint operations companies available future financing arrangements company engaged number investment banking firms negotiated private equity firms arrange financing potential acquisitions company believes able secure required financing arrangements however assurances could made management would successful achieving plan item 7a item 7 management’s discussion analysis financial condition results operations except audited historical information contained herein report specifies forwardlooking statements management company within meaning section 27a securities act 1933 section 21e securities exchange act 1934 “forwardlooking statements” including without limitation forwardlooking statements regarding company’s expectations beliefs intentions future strategies forwardlooking statements estimate happening future events based historical facts forward looking statements may identified use forwardlooking terminology “could” “may” “will” “expect” “shall” “estimate” “anticipate” “probable” “possible” “should” “continue” “intend” similar terms variations terms negative terms forwardlooking statements specified report compiled management company basis assumptions made management considered management reasonable future operating results company however impossible predict representation guaranty warranty inferred forwardlooking statements assumptions used purposes forwardlooking statements specified report represent estimates future events subject uncertainty possible changes economic legislative industry circumstances result identification interpretation data information use developing selecting assumptions among reasonable alternatives require exercise judgment extent assumed events occur outcome may vary substantially anticipated projected results accordingly opinion expressed achievability forwardlooking statements addition forwardlooking statements compiled date report evaluated consideration changes occurring date report assurance given assumptions relating forwardlooking statements specified report accurate company assumes obligation update forwardlooking statements results operations years ended june 30 2016 june 30 2015 revenues company generated 332050 revenues consulting advisory management services fiscal year ended june 30 2016 compared 127178 revenue year ended june 30 2015 operating expenses company incurred total operating expenses 464921 year ended june 30 2016 compared 433090 year ended june 30 2014 represents increase 31831 735 total operating expenses prior year increase primarily due decrease 8559 professional services increase 38947 general administrative expenses company spent advertising expenses current year relative previous fiscal year income loss operations company loss operations 132871 fiscal year ended june 30 2016 compared loss operations 305912 year ended june 30 2015 represents decrease 173041 5657 loss operations current year compared precious year mainly due fact company generated 204872 revenues incurring 31831 total operating expenses fiscal year ended june 30 2016 compared corresponding items fiscal year ended june 30 2015 income expense company net income 124873 year ended june 30 2016 compared net expenses 1063003 prior year primarily due fact company interest expense 267577 gain sale marketable securities amount 137017 income amount 255433 comprising reversal impairment assets amount 270000 writeoff loans receivable 9840 loss 2550 minority interest miscellaneous expense 2000 fiscal year ended june 30 2015 interest expense 319315 loss sale marketable securities 45176 loss 25845 settlement debts expense amount 672667 net income loss company net loss 7998 year ended june 30 2016 compared net loss 1368915 year ended june 30 2015 representing 9942 reduction losses two corresponding fiscal years net income loss per share based basic diluted weighted average number common shares outstanding year ended june 30 2016 000 compared 021 year ended june 30 2015 cash flows 2482 cash equivalents june 30 2016 compared 10645 cash equivalents june 30 2015 respectively net cash used operating activities 1849010 fiscal year ended june 30 2016 compared net cash used operating activities 1609353 fiscal year ended june 30 2015 respectively underlying reasons increase net cash used operating activities two periods mainly due decrease 1360917 net loss operations reduction 16134 increase assets prepaid expenses decrease 1616798 accounts payable accrued expenses current fiscal year previous fiscal year net cash used investing activities 146959 fiscal year ended june 30 2016 compared cash provided investing activities 65557 year ended june 30 2015 respectively underlying reasons change net cash provided used investing activities two fiscal years primarily due deposit 66776 acquisition purchase land 82733 writeoff 2550 investment joint venture current fiscal year compared writeoff 73043 receivable discontinued operations net deposit 4936 acquisition investment amount 2550 joint venture year ended june 30 2015 respectively net cash provided financing activities 1987517 fiscal year ended june 30 2016 compared cash provided financing activities 1523827 fiscal year ended june 30 2015 respectively underlying reasons increase cash provided financing activities current fiscal year mainly due increase 2085799 proceeds common stock current previous fiscal years offset change accumulative comprehensive income loss 69078 change accumulated deficit amount 87108 current fiscal year compared prior fiscal year historical financing arrangements short term notes payable issuance common stock course business company obtained shortterm loans individuals institutional investors time raised money issuing restricted common stock company auspices rule 144 june 30 2016 2015 company shortterm notes payable amounting 673660 1342618 accrued interest 2879655 3031152 respectively notes bear interest rates ranging 0 36 per annum years ended june 30 2016 2015 company paid 652041 31500 principal 77850 4956 interest shortterm notes respectively due preferred stockholders company classified 215000 preferred stock previously subscribed one long discontinued subsidiaries current liability payable holders preferred stock subsidiary due deficiencies connection previous preferred share subscription agreements amount past due june 30 2016 interest payable holders preferred stock abovementioned discontinued subsidiary amounts 413255 387455 included accrued interest included account payable accrued expenses balance sheet june 30 2016 june 30 2015 company’s plan operation following 12 months continue pursue merger acquisition program acquiring controlling interests target companies number industries including limited conventional energy renewables natural resources agribusiness technology transportation education distribution mining oil gas financial services healthcare pharmaceuticals entered agreements acquire majority interests two liquefied petroleum gas lpg companies southeast asia signed letters intent acquire number target companies us abroad intend continue seeking acquisition opportunities next twelve months close transactions feasible order build critical mass uplist senior national exchange soon practical addition continue provide advisory consulting services international clients wholly owned subsidiary phi capital holdings inc financial plans material cash requirements must raise substantial amounts capital fulfill plan acquiring energyrelated natural resource assets part scope business intend use equity debt project financing meet capital needs acquisitions management taken action formulated plans strengthen company’s working capital position generate sufficient cash meet operating needs june 30 2017 beyond working capital cash requirements next 12 months expected generated operations sale marketable securities additional financing company plans generate revenues consulting services merger acquisition advisory services acquisitions target companies cash flows available future financing arrangements september 2016 company signed agreement milost global inc us private equity firm commitment 100 million finance company’s future acquisitions provide working capital needs investment amount usd 50 million equity usd 50 million loans addition company may use sources funds including shortterm loans longterm debt equity financing may needed company believes able secure required capital implement business plan however assurances could made management would successful achieving plan item 7a item 7 management’s discussion analysis financial condition results operations except audited historical information contained herein report specifies forwardlooking statements management company within meaning section 27a securities act 1933 section 21e securities exchange act 1934 “forwardlooking statements” including without limitation forwardlooking statements regarding company’s expectations beliefs intentions future strategies forwardlooking statements estimate happening future events based historical facts forward looking statements may identified use forwardlooking terminology “could” “may” “will” “expect” “shall” “estimate” “anticipate” “probable” “possible” “should” “continue” “intend” similar terms variations terms negative terms forwardlooking statements specified report compiled management company basis assumptions made management considered management reasonable future operating results company however impossible predict representation guaranty warranty inferred forwardlooking statements assumptions used purposes forwardlooking statements specified report represent estimates future events subject uncertainty possible changes economic legislative industry circumstances result identification interpretation data information use developing selecting assumptions among reasonable alternatives require exercise judgment extent assumed events occur outcome may vary substantially anticipated projected results accordingly opinion expressed achievability forwardlooking statements addition forwardlooking statements compiled date report evaluated consideration changes occurring date report assurance given assumptions relating forwardlooking statements specified report accurate company assumes obligation update forwardlooking statements results operations years ended june 30 2019 june 30 2018 revenues company received 800000 european plastic joint stock company 466634 saigon pho palace joint stock company totaling 1266634 fiscal year ended june 30 2019 participation energy real estate compartments philux global funds respectively however recognize amounts revenues recorded subfund obligations compartments activated compared 1672659 total revenues year ended june 30 2018 operating expenses company incurred total operating expenses 2410213 year ended june 30 2019 compared 1902966 year ended june 30 2018 increase 507247 includes recognition 462000 rd expenses connection granite mining claims american pacific resources inc increase 6928 travel expenses increase 14156 advertising increase 25315 filing fees two fiscal periods income loss operations company loss operations 2410213 fiscal year ended june 30 2019 compared loss operations 230307 fiscal year ended june 30 2018 represents increase 2179906 loss operations current fiscal year compared precious year mainly due fact company recognize revenues subfund participation partners simultaneously incurring comparably expenses fiscal year ended june 30 2019 income expense company net expense 519448 fiscal year ended june 30 2019 compared net expense 1796013 prior year primarily due fact company recognized total 2514700 income result reduction 61939 derivative liabilities connection convertible promissory notes derecognition liabilities amount 1742891 due inactivity statutory limits adjustment discount convertible notes correction value common stock issued amount 709870 incurring 1897979 interest expense 1136169 expenses current fiscal year net income loss company net loss 2929661 fiscal year ended june 30 2019 compared net loss 2026320 prior year representing increase 903341 net loss two fiscal years net loss per share based basic diluted weighted average number common shares outstanding fiscal year ended june 30 2019 000 compared 003 fiscal year ended june 30 2018 cash flows cash equivalents 71768 june 30 2019 compared 13937 cash equivalents june 30 2018 respectively net cash used operating activities 244324 fiscal year ended june 30 2019 compared 2653481 fiscal year ended june 30 2018 respectively underlying reasons decrease net cash used operating activities two periods mainly due total decrease assets prepaid expenses amount 2011062 increase liabilities amount 385640 net loss operations 2929661 current fiscal year compared 22026320 previous fiscal year cash provided used investing activities fiscal year ended june 30 2019 compared combination cash promissory note used investing activities 25005000 fiscal year ended june 30 2018 respectively net cash provided financing activities 302154 fiscal year ended june 30 2019 compared cash provided financing activities 27634050 fiscal year ended june 30 2018 respectively net cash provided financing activities current fiscal year came loans officers directors amount 298420 3734 stock issuance cash historical financing arrangements short term notes payable issuance common stock course business company obtained shortterm loans individuals institutional investors time raised money issuing restricted common stock company auspices rule 144 notes bear interest rates ranging 0 36 per annum notes 11 15 convertible promissory notes company also time issued convertible promissory notes various private investment funds shortterm working capital special projects typically notes bear interest rates 5 12 per annum mature within one year convertible common stock company discount ranging 42 50 may repaid within 180 days prepayment premium ranging 130 150 note 11 company’s plan operation following 12 months next twelve months company’s goals create number subfunds philux global funds sca sicavraif investment real estate renewable energy agriculture infrastructure healthcare well develop asia diamond exchange vietnam addition company continue carry merger acquisition program acquiring target companies rollup strategy also invest special situations moreover provide advisory consulting services international clients wholly owned subsidiary philux capital advisors inc formerly known phi capital holdings inc financial plans material cash requirements must raise substantial amounts capital fulfill plans philux global funds acquisitions intend use equity debt project financing meet capital needs acquisitions investments management taken action formulated plans meet company’s operating needs june 30 2021 beyond working capital cash requirements next 12 months expected generated operations sale marketable securities additional financing company plans generate revenues consulting services merger acquisition advisory services acquisitions target companies cash flows available future financing arrangements company may use various sources funds including shortterm loans longterm debt equity capital project financing may necessary company believes able secure required capital implement business plan equity line facility march 6 2017 phi group inc nevada corporation “company” azure capital massachusetts corporation “investor” entered investment agreement “investment agreement” registration rights agreement “registration rights agreement” dated march 6 2017 company investor pursuant investment agreement investor committed purchase subject certain restrictions conditions 10000000 worth company’s common stock period 36 months effectiveness registration statement registering resale shares purchased investor pursuant investment agreement company agreed initially reserve 20000000 shares common stock issuance investor pursuant investment agreement event company cannot register sufficient number shares common stock issuance pursuant investment agreement company use best efforts authorize reserve issuance number shares required company perform obligations connection investment agreement soon reasonable practical company may discretion draw facility time company determines appropriate accordance terms conditions investment agreement maximum number shares company entitled put investor one draw notice shall exceed shares purchase price 250000 200 average daily volume us market company’s common stock three 3 trading days prior applicable put notice date multiplied average three 3 daily closing prices immediately preceding put date calculated accordance investment agreement company may deliver notice subsequent put time pricing period prior put completed purchase price shall set ninetyfour percent 94 lowest daily volume weighted average price vwap company’s common stock five 5 consecutive trading days immediately following put notice date put notice submitted investor company shall specify suspension price put event price company’s common stock falls suspension price put shall temporarily suspended put shall resume time price company’s common stock suspension price provided dates pricing period particular put still valid event pricing period complete shares suspension price due investor shall sold investor company suspension price terms investment agreement suspension price put may changed company submitted investor put restrictions applied days draw notice date closing date respect particular put time company shall entitled deliver another draw notice addition investor obligated purchase shares investor’s total number shares beneficially held time would exceed 499 number shares company’s common stock determined accordance rule 13d1j securities exchange act 1934 amended addition company permitted draw facility unless effective registration statement cover resale shares investment agreement also contains customary representations warranties parties assertions embodied representations warranties made purposes investment agreement subject qualifications limitations agreed parties connection negotiating terms investment agreement investment agreement provides company investor entitled customary indemnification among things losses liabilities may suffer result breach party provisions investment agreement registration rights agreement defined investor read investment agreement together information concerning company publicly files reports statements securities exchange commission “sec” pursuant terms registration rights agreement company obligated file one registrations statements sec within twentyone 21 days date registration rights agreement register resale investor shares common stock issued issuable investment agreement addition company obligated use commercially reasonable efforts registration statement declared effective sec within 90 days registration statement filed investment agreement amended august 3 2017 allow reservation 65445000 shares company’s common stock issuance investor pursuant corrected investment agreement company filed s1 registration statement securities exchange commission include 7936600 shares common stock issuance connection first tranche equity line facility s1 registration statement amended declared effective securities exchange commission january 11 2018 day report company accessed equity line facility funding item 7a item 7 managements discussion analysis financial condition results operations except audited historical information contained herein report specifies forwardlooking statements management company within meaning section 27a securities act 1933 section 21e securities exchange act 1934 forwardlooking statements including without limitation forwardlooking statements regarding companys expectations beliefs intentions future strategies forwardlooking statements estimate happening future events based historical facts forward looking statements may identified use forwardlooking terminology could may expect shall estimate anticipate probable possible continue intend similar terms variations terms negative terms forwardlooking statements specified report compiled management company basis assumptions made management considered management reasonable future operating results company however impossible predict representation guaranty warranty inferred forwardlooking statements assumptions used purposes forwardlooking statements specified report represent estimates future events subject uncertainty possible changes economic legislative industry circumstances result identification interpretation data information use developing selecting assumptions among reasonable alternatives require exercise judgment extent assumed events occur outcome may vary substantially anticipated projected results accordingly opinion expressed achievability forwardlooking statements addition forwardlooking statements compiled date report evaluated consideration changes occurring date report assurance given assumptions relating forwardlooking statements specified report accurate company assumes obligation update forwardlooking statements results operations years ended june 30 2011 june 30 2010 revenues company generated net revenue 409317 consulting advisory services year ended june 30 2011 compared 83990 year ended june 30 2010 represented increase consulting advisory revenue operating expenses company incurred total operating expenses 983664 year ended june 30 2011 compared 1420582 year ended june 30 2010 represents 31 decrease operating expenses prior year decrease primarily due decrease professional services general administrative expenses relative decrease consulting advisory services company’s professional fees increased 1 341565 year ended june 30 2011 compared 332191 prior year mainly due increase auditing fees consulting fees decreased 10 231341 prior year 206871 current year net income loss operations company net loss operations 574348 year ended june 30 2011 compared 1336593 year ended june 30 2010 mainly due revenue generated 2011 amount 409317 compared revenue 83990 generated 2010 31 decrease operating expenses current fiscal year decrease operating expenses primarily due decrease general administrative expenses current fiscal year net income company net loss 1178297 year ended june 30 2011 compared 3568438 year ended june 30 2010 company also recorded loss debt settlement 402107 year ended june 30 2011 compared 2701 year ended june 30 2010 interest expenses increased 557173 year ended june 30 2011 compared 507396 impairment marketable securities year ended june 30 2011 compared 1750000 year ended june 30 2010 impairment loan receivable year ended june 30 2011 compared 109600 year ended june 30 2010 net loss based basic diluted weighted average number common shares outstanding year ended june 30 2011 001 compared 002 year ended june 30 2010 liquidity capital resources must continue raise capital fulfill plan acquiring companies assisting development internally company expects working capital cash requirements next 12 months generated operations additional financing cash equivalents 61270 75299 june 30 2011 june 30 2010 respectively operating activities used 354020 cash year ended june 30 2011 compared cash provided 119771 year ended june 30 2010 cash used investing activities 218556 compared 208902 year ended june 30 2011 2010 respectively years ended june 30 2011 2010 company received 0 47385 respectively sale marketable securities company spent 0 1165 purchase marketable securities years ended june 30 2011 2010 respectively cash provided financing activities 558544 126618 years ended june 30 2011 2010 respectively year ended june 30 2011 primarily proceeds notes including borrowing officers amount 29470 unrelated parties amount 476000 offset total payments notes amounting 163550 purchase treasury shares 482 year ended june 30 2010 proceeds notes totaled 221326 borrowings officers totaled 208992 reduced payments notes amounting 436889 purchase treasury shares 11811 short term notes payable june 30 2011 2010 company short term notes payable amounting 2432456 2400546 accrued interest 1872479 1367980 respectively notes bear interest rates ranging 6 36 per annum 1744982 short term notes past due 258976 due demand june 30 2011 year ended june 30 2011 2010 company paid 249750 130865 principal 22710 68395 interest short term notes payable secured assets company summarized note balance secured 115000 400000 catalyst resource group shares 500000 catthai corp shares 550000 35000 cavico corp shares 500000 catthai corp shares 150000 1500000 phi mining group shares 100000 1500000 phi mining group shares due preferred stockholders company classified 215000 preferred stock previously subscribed one subsidiaries current liability payable holders preferred stock due non compliance preferred shares subscription agreement amount past due june 30 2011 company made 5000 interest payment year ended june 30 2007 interest payable holders preferred stock 284255 258455 included accrued interest included account payable accrued expenses balance sheet june 30 2011 june 30 2010 companys plan operation next 12 months primary scope business consists mergers acquisitions merger acquisition advisory services real estate development hospitality healthcare services mining investments special situations potential high growth next twelve months company intends emphasize advisory services small midsized companies us pacific rim focus development real estate program chu lai central vietnam housing hanoi ho chi minh city philand ranch limited develop mining business phi mining group inc pursue oil gas development opportunities providential energy corporation engage special situations may create value company’s shareholders guaranty company successful plans financial plans management taken action formulating additional plans strengthen companys working capital position generate sufficient cash meet operating needs june 30 2011 beyond among actions taken company intends raise additional capital us international markets currently process attaining additional financing addition company also anticipates generating revenue proposed mergers acquisitions assurances made management successful achieving plan item 7a item 7 management’s discussion analysis financial condition results operations except audited historical information contained herein report specifies forwardlooking statements management company within meaning section 27a securities act 1933 section 21e securities exchange act 1934 “forwardlooking statements” including without limitation forwardlooking statements regarding company’s expectations beliefs intentions future strategies forwardlooking statements estimate happening future events based historical facts forward looking statements may identified use forwardlooking terminology “could” “may” “will” “expect” “shall” “estimate” “anticipate” “probable” “possible” “should” “continue” “intend” similar terms variations terms negative terms forwardlooking statements specified report compiled management company basis assumptions made management considered management reasonable future operating results company however impossible predict representation guaranty warranty inferred forwardlooking statements assumptions used purposes forwardlooking statements specified report represent estimates future events subject uncertainty possible changes economic legislative industry circumstances result identification interpretation data information use developing selecting assumptions among reasonable alternatives require exercise judgment extent assumed events occur outcome may vary substantially anticipated projected results accordingly opinion expressed achievability forwardlooking statements addition forwardlooking statements compiled date report evaluated consideration changes occurring date report assurance given assumptions relating forwardlooking statements specified report accurate company assumes obligation update forwardlooking statements results operations years ended june 30 2012 june 30 2011 revenues company generated net revenue 570000 consulting advisory services year ended june 30 2012 compared 409317 year ended june 30 2011 represented increase consulting advisory revenue operating expenses company incurred total operating expenses 481509 year ended june 30 2012 compared 983665 year ended june 30 2011 represents 51 decrease total operating expenses prior year decrease primarily due decrease professional services general administrative expenses relative reduced activity consulting advisory services current fiscal year company’s professional fees decreased 75 45419 current year compared 341565 prior year mainly due decrease usage thirdparty consulting professional services fiscal year ended june 30 2012 net income loss operations company income operations 88491 year ended june 30 2012 compared loss operation 574348 year ended june 30 2011 mainly due higher revenues generated consulting advisory services fiscal year ended june 30 2012 compared generated fiscal year ended june 30 2011 51 decrease total operating expenses current fiscal year decrease operating expenses primarily due decrease general administrative expenses current fiscal year net income loss company net loss 5103603 year ended june 30 2012 compared 1178298 year ended june 30 2011 company also recorded loss debt settlement 32808 year ended june 30 2012 compared 402107 year ended june 30 2011 interest expenses increased 609596 year ended june 30 2012 compared 557173 period ended june 30 2011 substantial increase net loss year ended june 30 2012 due loss discontinued operations 4612330 net tax company’s subsidiaries current fiscal year compared loss discontinued operations year ended june 30 2011 loss discontinued operations onetime charge related company’s discontinued noncore businesses net loss based basic diluted weighted average number common shares outstanding year ended june 30 2012 338 compared 873 year ended june 30 2011 liquidity capital resources must continue raise substantial amounts capital fulfill plan acquiring energyrelated natural resource assets part new scope business working capital cash requirements next 12 months following end current fiscal year would generated operations additional financing cash equivalents 0 61270 june 30 2012 june 30 2011 respectively operating activities used 1087705 cash year ended june 30 2012 compared 354020 year ended june 30 2011 cash provided investing activities 1153632 compared cash used 218556 year ended june 30 2012 2011 respectively cash used financing activities 127197 year ended june 30 2012 compared cash provided financing activities 558544 year ended june 30 2011 year ended june 30 2012 primarily proceeds notes including borrowing officers amount 87612 unrelated parties amount 44500 offset total payments notes amounting 246990 purchase treasury shares 16991 short term notes payable june 30 2012 2011 company short term notes payable amounting 2125456 2432456 accrued interest 2509944 1872479 respectively notes bear interest rates ranging 6 36 per annum 2250968 short term notes past due 258976 due demand june 30 2011 years ended june 30 2012 2011 company paid 307000 249750 principal 8700 22710 interest short term notes respectively notes payable secured assets company summarized due preferred stockholders company classified 215000 preferred stock previously subscribed one long discontinued subsidiaries current liability payable holders preferred stock subsidiary due non compliance preferred shares subscription agreements amount past due june 30 2012 last interest payment 5000 made company year ended june 30 2007 interest payable holders preferred stock 310055 284255 included accrued interest included account payable accrued expenses balance sheet june 30 2012 june 30 2011 company’s plan operation following 12 months revised scope business primarily focuses energy natural resources continues provide corporate finance project financing including merger acquisition advisory consulting services subsidiary phi capital holdings inc following twelve months commencing june 30 2012 company continued investigate opportunities energyrelated natural resource assets acquisition develop new business areas corporate finance project financing company also actively pursued opportunities international trade developed growing network potential buyers suppliers energyrelated natural resource products however guarantee could made company would successful plans time frame financial plans management took action formulated additional plans strengthen company’s working capital position generate sufficient cash meet operating needs june 30 2013 beyond among actions taken company generated revenues consulting services continued raise additional capital us international investors addition company also expected generate revenue merger acquisition advisory services trading activity joint operations companies however assurances could made management would successful achieving plan item 7a item 7 management’s discussion analysis financial condition results operations except audited historical information contained herein report specifies forwardlooking statements management company within meaning section 27a securities act 1933 section 21e securities exchange act 1934 “forwardlooking statements” including without limitation forwardlooking statements regarding company’s expectations beliefs intentions future strategies forwardlooking statements estimate happening future events based historical facts forward looking statements may identified use forwardlooking terminology “could” “may” “will” “expect” “shall” “estimate” “anticipate” “probable” “possible” “should” “continue” “intend” similar terms variations terms negative terms forwardlooking statements specified report compiled management company basis assumptions made management considered management reasonable future operating results company however impossible predict representation guaranty warranty inferred forwardlooking statements assumptions used purposes forwardlooking statements specified report represent estimates future events subject uncertainty possible changes economic legislative industry circumstances result identification interpretation data information use developing selecting assumptions among reasonable alternatives require exercise judgment extent assumed events occur outcome may vary substantially anticipated projected results accordingly opinion expressed achievability forwardlooking statements addition forwardlooking statements compiled date report evaluated consideration changes occurring date report assurance given assumptions relating forwardlooking statements specified report accurate company assumes obligation update forwardlooking statements results operations years ended june 30 2013 june 30 2012 revenues company generate revenues year ended june 30 2013 compared 570000 consulting advisory services year ended june 30 2012 operating expenses company incurred total operating expenses 403310 year ended june 30 2013 compared 481509 year ended june 30 2012 represents 1624 decrease total operating expenses prior year decrease primarily due decrease general administrative expenses relative reduced activity consulting advisory services current fiscal year company’s professional fees increased 89042 year ended june 30 2013 including noncash compensations compared 45419 prior year mainly due increase usage third party consulting professional services fiscal year ended june 30 2013 net income loss operations company loss operations 403310 year ended june 30 2013 compared income operations 88491 year ended june 30 2012 mainly due fact company generate revenues fiscal year ended june 30 2013 whereas generated 570000 revenues consulting advisory services fiscal year ended june 30 2012 net income loss company net loss 884047 year ended june 30 2013 compared net loss 5153603 year ended june 30 2012 company recorded loss sale marketable securities 700 fiscal year ended june 30 2013 compared loss sale marketable securities 28000 previous fiscal year interest expenses 480037 fiscal year ended june 30 2013 compared 609596 fiscal year ended june 30 2012 substantial decrease net loss year ended june 30 2013 compared previous year due nonrecurring loss discontinued operations 4612330 net tax company’s subsidiaries fiscal year ended june 30 2012 net loss based basic diluted weighted average number common shares outstanding year ended june 30 2013 636 compared 338 year ended june 30 2012 liquidity capital resources must continue raise substantial amounts capital fulfill plan acquiring energyrelated natural resource assets part new scope business working capital cash requirements next 12 months following end current fiscal year would generated operations additional financing cash equivalents june 30 2013 june 30 2012 respectively net cash used operating activities 89118 fiscal year ended june 30 2013 compared net cash used operating activities 1087705 fiscal year ended june 30 2012 respectively net cash provided investing activities 5393 fiscal year ended june 30 2013 compared cash used investing activities 1153632 year ended june 30 2012 respectively net cash provided financing activities 83724 fiscal year ended june 30 2013 compared cash used financing activities 127197 fiscal year ended june 30 2012 respectively short term notes payable june 30 2013 2012 company shortterm notes payable amounting 1426456 2125456 accrued interest 2952261 2509944 respectively notes bear interest rates ranging 6 36 per annum 1167480 shortterm notes past due 258976 due demand june 30 2013 years ended june 30 2013 2012 company paid 764500 173000 principal 4654527 8700 interest short term notes respectively notes payable secured assets company summarized due preferred stockholders company classified 215000 preferred stock previously subscribed one long discontinued subsidiaries current liability payable holders preferred stock subsidiary due non compliance preferred shares subscription agreements amount past due june 30 2013 last interest payment 5000 made company year ended june 30 2007 interest payable holders preferred stock 355855 310055 included accrued interest included account payable accrued expenses balance sheet june 30 2013 june 30 2012 company’s plan operation following 12 months revised scope business primarily focuses energy natural resources continues provide corporate finance project financing including merger acquisition advisory consulting services subsidiary phi capital holdings inc following twelve months commencing june 30 2013 company continued investigate opportunities energyrelated natural resource assets acquisition develop new business areas corporate finance project financing company also actively pursued opportunities international trade developed growing network potential buyers suppliers energyrelated natural resource products however guarantee could made company would successful plans time frame financial plans management took action formulated additional plans strengthen company’s working capital position generate sufficient cash meet operating needs june 30 2014 beyond among actions taken company generated revenues consulting services continued raise additional capital us international investors addition company also expected generate revenue merger acquisition advisory services trading activity joint operations companies however assurances could made management would successful achieving plan item 7a item 7 management’s discussion analysis financial condition results operations except audited historical information contained herein report specifies forwardlooking statements management company within meaning section 27a securities act 1933 section 21e securities exchange act 1934 “forwardlooking statements” including without limitation forwardlooking statements regarding company’s expectations beliefs intentions future strategies forwardlooking statements estimate happening future events based historical facts forward looking statements may identified use forwardlooking terminology “could” “may” “will” “expect” “shall” “estimate” “anticipate” “probable” “possible” “should” “continue” “intend” similar terms variations terms negative terms forwardlooking statements specified report compiled management company basis assumptions made management considered management reasonable future operating results company however impossible predict representation guaranty warranty inferred forwardlooking statements assumptions used purposes forwardlooking statements specified report represent estimates future events subject uncertainty possible changes economic legislative industry circumstances result identification interpretation data information use developing selecting assumptions among reasonable alternatives require exercise judgment extent assumed events occur outcome may vary substantially anticipated projected results accordingly opinion expressed achievability forwardlooking statements addition forwardlooking statements compiled date report evaluated consideration changes occurring date report assurance given assumptions relating forwardlooking statements specified report accurate company assumes obligation update forwardlooking statements results operations years ended june 30 2017 june 30 2016 revenues company generated 113500 revenues consulting advisory management services fiscal year ended june 30 2017 compared 332050 revenue year ended june 30 2016 operating expenses company incurred total operating expenses 670458 year ended june 30 2017 compared 464921 year ended june 30 2016 represents increase 205537 4421 total operating expenses prior year increase primarily due increase 245073 professional services offset decrease 36910 general administrative expenses income loss operations company loss operations 556958 fiscal year ended june 30 2017 compared loss operations 132871 year ended june 30 2016 represents increase 424087 31917 loss operations current year compared precious year mainly due fact company generated 218550 less revenues incurring 205537 total operating expenses fiscal year ended june 30 2017 compared corresponding items fiscal year ended june 30 2016 income expense company net expense 1003760 fiscal year ended june 30 2017 compared net income 124873 prior year primarily due fact company increase interest expense 258985 loss sale marketable securities 2874 loss sale assets 20011 loss loannote conversions 131818 expense 322495 current year compared prior year net income loss company net loss 1560718 fiscal year ended june 30 2017 compared net loss 7998 prior year representing increase 1552720 net loss two fiscal years net loss per share based basic diluted weighted average number common shares outstanding fiscal year ended june 30 2017 010 compared 000 fiscal year ended june 30 2016 cash flows 38369 cash equivalents june 30 2017 compared 2482 cash equivalents june 30 2016 respectively net cash used operating activities 6924748 fiscal year ended june 30 2017 compared net cash used operating activities 1849100 fiscal year ended june 30 2016 respectively underlying reasons increase net cash used operating activities two periods mainly due increase 108876 assets prepaid expenses decrease accrued expenses 5254654 due reclassification longterm liabilities increase 1552720 net loss operations current fiscal year previous fiscal year net cash provided investing activities 224688 fiscal year ended june 30 2017 compared cash used investing activities 146959 fiscal year ended june 30 2016 respectively underlying reasons change net cash provided used investing activities two fiscal years primarily due writeoffs 157733 deposit acquisition asset receivable sale land live oak florida connection closure cornerstone biomass corporation two corresponding fiscal years net cash provided financing activities 6735447 fiscal year ended june 30 2017 compared cash provided financing activities 1987517 fiscal year ended june 30 2016 respectively underlying reasons increase cash provided financing activities current fiscal year primarily due change shortterm longterm liabilities 5722056 proceeds common stock 907261 change comprehensive income loss 123211 current fiscal year compared prior fiscal year historical financing arrangements short term notes payable issuance common stock course business company obtained shortterm loans individuals institutional investors time raised money issuing restricted common stock company auspices rule 144 june 30 2017 company reclassified 614390 shortterm notes payable accrued interest 2303163 longterm liabilities compared shortterm notes payable 673660 accrued interest 2879655 june 30 2016 respectively notes bear interest rates ranging 0 36 per annum convertible promissory notes february 29 2016 company issued convertible promissory note amount 56750 auctus fund llc delaware limited liability company convertible note due payable november 29 2016 interest 10 per annum note convertible election auctus fund llc time issuance date event default amount principal interest paid due bear interest rate 24 per annum note becomes immediately due payable event default occur company liable pay 150 outstanding principal interest note agreement contains covenants requiring auctus fund’s written consent certain activities existence committed company issuance date note follows dividend distributions cash shares stock repurchases borrowings sale assets certain advances loans excess 100000 certain guarantees respect preservation existence company noncircumvention outstanding note principal interest accrued thereon converted whole part time asher issuance date equivalent company’s common stock determined 55 average two lowest closing trading prices company’s common stock twenty 20 trading days prior date note company may prepay amounts outstanding auctus fund time 180th day following issue date note making payment note holder amount cash equal 125 150 multiplied sum w outstanding principal amount note plus x accrued unpaid interest unpaid principal amount note plus default interest depending time prepayment august 30 2016 auctus fund llc converted principal amount 56750 282976 accrued interest totaling 5957976 529598 shares freetrading stock company note paid full august 30 2016 fiscal year ended june 30 2017 company issued following convertible promissory notes various private investment funds july 20 2016 company issued convertible promissory note amount 50000 ema financial llc delaware limited liability company note coupon rate 10 matures one year convertible common stock company conversion price equals lower closing sale price common stock principal market trading immediately preceding closing date note ii 55 lowest sale price common stock principal market twenty 20 consecutive trading days immediately preceding conversion date note may prepaid 130 145 outstanding principal interest 180 days note paid full march 08 2017 august 16 2016 company issued convertible promissory note amount 56750 auctus fund llc delaware limited liability company note coupon rate 10 matures may 16 2017 convertible common stock company conversion price equals lower 50 multiplied average two lowest trading price previous twentyfive trading day period ending latest complete trading date prior date note ii 50 multiplied average two lowest trading prices common stock twentyfive trading day period ending latest complete trading day prior conversion date note may prepaid 135 150 outstanding principal interest 180 days note paid full april 6 2017 december 15 2016 company issued convertible promissory note amount 32000 power lending group note coupon rate 8 matures september 30 2017 convertible 180 days common stock company conversion price equals 58 multiplied average two lowest trading prices previous ten trading day period ending latest complete trading date prior conversion date note may prepaid 150 outstanding principal interest 180 days note paid conversions shares common stock company july 21 2017 february 2 2017 company issued convertible promissory note amount 3373468 jsj investments inc assignment portion principal amount accrued interest ema financial llc convertible promissory note dated july 20 2016 note converted 657169 shares common stock company jsj investments inc february 7 2017 february 2 2017 company issued convertible promissory note amount 42000 jsj investments inc interest rate 10 convertible common stock 45 discount maturity date note 1122017 august 1 2017 company paid 3146260 jsj investments one half principal note one half prepayment premium one half accrued unpaid interest september 30 2017 unpaid principal balance 21000 february 23 2017 company issued new convertible promissory note power lending group 28000 interest rate 8 convertible common stock company 45 discount maturity date note 11302017 august 14 2017 company paid total 4302488 power lending group amount included principal prepayment premium accrued interest note paid full august 14 2017 march 3 2017 company issued new convertible promissory note auctus fund llc 75000 interest rate 10 convertible common stock company 50 discount maturity date note 1232017 september 9 2017 company paid auctus fund llc 3930822 amount included one third principal one third prepayment premium one third accrued interest september 30 2017 unpaid principal note 50000 april 4 2017 company issued new convertible promissory note ema financial llc 50000 interest rate 10 convertible common stock company 50 discount maturity date note 442018 april 5 2017 company issued new convertible promissory note jsj investments inc 40000 interest rate 10 convertible common stock company 45 discount maturity date note 152018 april 12 2017 company issued new convertible promissory note power lending group 33500 interest rate 12 convertible common stock company 42 discount maturity date note 1252018 june 9 2017 company issued new convertible promissory note crown bridge partners llc 35000 interest rate 5 convertible common stock company 50 discount maturity date note june 9 2018 june 30 2017 principal balance outstanding convertible notes 364098 value derivative liability 452441 company relies professional thirdparty valuation record value derivative liability discount change fair value derivatives connection convertible notes warrants related convertible notes company intends prefers repay notes cash much practical company’s plan operation following 12 months next twelve months company intends continue pursuing merger acquisition program acquiring controlling interests target companies number industries including limited energy natural resources agribusiness technology transportation consumer goods healthcare biotechnology pharmaceuticals addition company also plans invest special situations may potentially generate significant revenues profitability company short term believe closing one sizable acquisitions able build critical mass uplist nasdaq stock market nyse near future moreover continue provide advisory consulting services international clients wholly owned subsidiary phi capital holdings inc company anticipates generating substantial amounts revenues merger acquisition program investment special situations advisory services mentioned herein however assurances could made management would successful achieving plan president chairman company committed funding company’s operations various sources next 12 months financial plans material cash requirements must raise substantial amounts capital fulfill plan acquiring energyrelated natural resource assets well investing special situations part scope business intend use equity debt project financing meet capital needs acquisitions investments management taken action formulated plans strengthen company’s working capital position generate sufficient cash meet operating needs june 30 2018 beyond working capital cash requirements next 12 months expected generated operations sale marketable securities additional financing company plans generate revenues consulting services merger acquisition advisory services acquisitions target companies cash flows available future financing arrangements company may use various sources funds including shortterm loans longterm debt equity capital project financing may necessary company believes able secure required capital implement business plan however assurances could made management would successful achieving plan eb5 immigration investor program company filed i924 application united states citizenship immigration service uscis phi group eb5 regional center llc order raise capital eb5 immigration investor program connection company’s organic farming program abundant farms inc wholly owned subsidiary company potential business activities state florida eb5 program created congress stimulate us economy job creation capital investment foreign entrepreneurs spouses unmarried children 21 eligible apply green card permanent residence make necessary investment commercial enterprise united states creates preserves least 10 permanent fulltime jobs qualified us workers operation regional center subject review approval united states citizenship immigration service equity financing arrangements august 3 2017 company entered investment agreement “investment agreement” azure capital “investor” pursuant investment agreement investor committed purchase 10000000 company’s common stock thirtynine months “equity line” aggregate number shares issuable company purchasable azure investment agreement 65445000 estimated using last reported sale price company’s common stock otcqb market august 3 2017 01528 per share company may draw facility time determines appropriate accordance terms conditions investment agreement maximum amount company entitled put one notice greater 200 average daily volume us market common stock three 3 trading days prior date delivery applicable put notice multiplied average closing prices trading days ii 250000 purchase price shall set ninetyfour per cent 94 lowest daily vwap company’s common stock pricing period however trading day pricing period daily volumeweighted average price vwap common stock lower floor price specified us put notice company reserves right withdraw portion put amount trading day pricing period balance put amount minimum acceptable price put azure put restrictions applied days put notice date closing date respect particular put time company entitled deliver another put notice circumstances company entitled put shares azure including following ● company entitled put shares azure unless effective registration statement securities act cover resale shares azure ● company entitled put shares azure unless common stock continues quoted otc bulletin board becomes listed national securities exchange ● company entitled put shares azure extent shares would cause azure’ beneficial ownership exceed 499 outstanding shares ● company entitled put shares azure prior closing date preceding put investment agreement provides company azure entitled customary indemnification losses liabilities suffers result breach provisions investment agreement registration rights agreement azure result lawsuit brought thirdparty arising resulting party’s execution delivery performance enforcement investment agreement registration rights agreement investment agreement also contains representations warranties parties assertions embodied representations warranties made purposes investment agreement subject qualifications limitations agreed parties connection negotiating terms investment agreement addition certain representations warranties made specific date may subject contractual standard materiality different stockholder investor might view material may used purposes allocating risk respective parties rather establishing matters facts company also entered registration rights agreement azure august 3 2017 pursuant terms registration rights agreement company obligated file one registration statements sec register resale azure shares common stock issued issuable investment agreement registration process continue time dollar amounts available credit line using shares common stock issuable investment agreement registered resale effective registration statements event company obligated register resale 10000000 value shares common stock 65445000 shares estimated using last reported sale price company’s common stock otcqb market august 3 2017 01528 per share item 7a item 7 managements discussion analysis financial condition results operations except audited historical information contained herein report specifies forwardlooking statements management company within meaning section 27a securities act 1933 section 21e securities exchange act 1934 forwardlooking statements including without limitation forwardlooking statements regarding companys expectations beliefs intentions future strategies forwardlooking statements estimate happening future events based historical facts forward looking statements may identified use forwardlooking terminology could may expect shall estimate anticipate probable possible continue intend similar terms variations terms negative terms forwardlooking statements specified report compiled management company basis assumptions made management considered management reasonable future operating results company however impossible predict representation guaranty warranty inferred forwardlooking statements assumptions used purposes forwardlooking statements specified report represent estimates future events subject uncertainty possible changes economic legislative industry circumstances result identification interpretation data information use developing selecting assumptions among reasonable alternatives require exercise judgment extent assumed events occur outcome may vary substantially anticipated projected results accordingly opinion expressed achievability forwardlooking statements addition forwardlooking statements compiled date report evaluated consideration changes occurring date report assurance given assumptions relating forwardlooking statements specified report accurate company assumes obligation update forwardlooking statements results operations years ended june 30 2009 june 30 2008 revenues company generated net revenue 2006220 consulting advisory services year ended june 30 2009 compared 3609318 year ended june 30 2008 represented 4441 decrease consulting advisory revenue decrease mainly due decrease size scope merger acquisition activities current year operating expenses company incurred total operating expenses 1595009 year ended june 30 2009 compared 1658534 year ended june 30 2008 represents 38 decrease operating expenses prior year decrease primarily due decrease professional services general administrative expenses relative decrease consulting advisory services company’s professional fees decreased 23 599804 year ended june 30 2009 compared 778440 prior year mainly due decrease legal fees legal fees decreased 94 137635 prior year 7951 current year company incurred high legal fees prior year due legal service related fund raising activities legal fees payment part consulting services clients net income loss operations company net income operations 411211 year ended june 30 2009 compared 1950784 year ended june 30 2008 mainly due 44 decrease consulting advisory revenue 38 decrease operating expenses current fiscal year decrease operating expenses primarily due decrease professional expenses general administrative expenses current fiscal year net income company net loss 8322040 year ended june 30 2009 compared net income 2359282 year ended june 30 2008 fiscal year ended june 30 2009 included loss marketable securities 4018 965 compared gain 701832 year ended june 30 2008 company also recorded gain debt settlement 187794 year ended june 30 2009 compared 67719 year ended june 30 2008 interest expenses increased 586468 year ended june 30 2009 compared 362536 due new notes payable added current period company recorded impairment marketable securities amount 4061715 loan receivable amount 282148 year ended june 30 2009 compared impairment recorded year ended june 30 2008 net loss based basic diluted weighted average number common shares outstanding year ended june 30 2009 004 compared net income 001 year ended june 30 2008 liquidity capital resources business plan restructured november 2000 updated nowcurrent form must continue raise capital fulfill plan acquiring companies assisting development internally company expects working capital cash requirements next 12 months generated operations additional financing cash equivalents 37813and 117166 june 30 2009 june 30 2008 respectively operating activities used 550329 cash year ended june 30 2009 compared 1782930 year ended june 30 2008 largest items affecting cash operations marketable securities received services totaling 2080200 loss sale marketable securities 4018965 year ended june 30 2009 compared gain 701832 prior year cash used investing activities 575127 compared cash provided 473478 year ended june 30 2009 2008 respectively years ended june 30 2009 2008 company received 268840 642094 respectively sale marketable securities company spent 25292 35388 purchase marketable securities years ended june 30 2009 2008 respectively company used 125421 investments year ended june 30 2009 106000 investments year ended june 30 2008 respectively company spent 35792 27228 purchase fixed assets fiscal year ended june 30 2009 2008 respectively cash provided financing activities 1046103 1418866 years ended june 30 2009 2008 respectively year ended june 30 2009 primarily proceeds notes including borrowing officers amount 491934 unrelated parties amount 637600 offset total payments notes amounting 214198 year ended june 30 2008 proceeds notes totaled 1322600 borrowings officer totaled 355642 reduced payments notes amounting 255592 purchase treasury shares 3784 short term notes payable june 30 2009 2008 company short term notes payable amounting 2310085 1816255 accrued interest 466387 340753 respectively notes bear interest rates ranging 6 36 per annum 1811500 short term notes past due 315535 due demand june 30 2009 year ended june 30 2009 2008 company paid 167485 174000 principal 200135 196188 interest short term notes payable secured assets company summarized due preferred stockholders company classified 215000 preferred stock subscribed current liability payable holders preferred stock due non compliance preferred shares subscription agreement amount past due june 30 2009 company made 5000 interest payment year ended june 30 2007 interest payable holders preferred stock 232655 included accrued interest included account payable accrued expenses balance sheet june 30 2009 current liabilities year ended june 30 2004 company received overpayment 89691 exercise stock options amount paid company june 30 2009 classified payable included current liabilities companys plan operation next 12 months divestiture company’s diva subsidiaries june 2000 discontinuance securities brokerage operations october 2000 restructured updated primary scope business focus mergers acquisitions merger acquisition advisory services investments various businesses potential high growth next twelve months company intends emphasize advisory services small midsized companies us pacific rim focus development real estate program chu lai south hoi central vietnam philand ranch limited develop mining business southeast asia phi mining group inc pursue oil gas transactions providential energy corporation engage special situations may create value company’s shareholders guaranty company successful plans financial plans management taken action formulating additional plans strengthen companys working capital position generate sufficient cash meet operating needs june 30 2010 beyond among actions taken company intends raise additional capital us international markets currently process attaining additional financing addition company also anticipates generating revenue proposed mergers acquisitions assurances made management successful achieving plan item 7a item 7 management’s discussion analysis financial condition results operations except audited historical information contained herein report specifies forwardlooking statements management company within meaning section 27a securities act 1933 section 21e securities exchange act 1934 “forwardlooking statements” including without limitation forwardlooking statements regarding company’s expectations beliefs intentions future strategies forwardlooking statements estimate happening future events based historical facts forward looking statements may identified use forwardlooking terminology “could” “may” “will” “expect” “shall” “estimate” “anticipate” “probable” “possible” “should” “continue” “intend” similar terms variations terms negative terms forwardlooking statements specified report compiled management company basis assumptions made management considered management reasonable future operating results company however impossible predict representation guaranty warranty inferred forwardlooking statements assumptions used purposes forwardlooking statements specified report represent estimates future events subject uncertainty possible changes economic legislative industry circumstances result identification interpretation data information use developing selecting assumptions among reasonable alternatives require exercise judgment extent assumed events occur outcome may vary substantially anticipated projected results accordingly opinion expressed achievability forwardlooking statements addition forwardlooking statements compiled date report evaluated consideration changes occurring date report assurance given assumptions relating forwardlooking statements specified report accurate company assumes obligation update forwardlooking statements results operations years ended june 30 2020 june 30 2019 revenues company received 12531 consulting services fiscal year ended june 30 2020 fiscal year ended june 30 2019 company received total payment 1266634 partners participation energy real estate compartments philux global funds however recognize amounts revenues recorded subfund obligations compartments activated operating expenses company incurred total operating expenses 1873738 year ended june 30 2020 compared 2410213 year ended june 30 2019 decrease 536475 includes decrease 445101 general administrative expenses decrease 143874 professional services increase 525000 salaries wages fees two fiscal periods income loss operations company loss operations 1861207 fiscal year ended june 30 2020 compared loss operations 2410213 fiscal year ended june 30 2019 represents decrease 549006 loss operations current fiscal year compared precious year mainly due decrease 445101 general administrative expenses decrease 143874 professional services increase 525000 salaries wages fees two fiscal periods mentioned plus revenues 12531 current period income expense company net expense 316330 fiscal year ended june 30 2020 compared net expense 519448 prior year decrease 203118 two fiscal periods primarily due decrease 1597711 interest expenses offset decrease 2514699 income decrease expenses amount 1120106 company recognized total 2514700 income result reduction 61939 derivative liabilities connection convertible promissory notes derecognition liabilities amount 1742891 due inactivity statutory limits adjustment discount convertible notes correction value common stock issued amount 709870 incurring 1897979 interest expense 1136169 expenses previous fiscal year net income loss company net loss 2177536 fiscal year ended june 30 2020 compared net loss 2929661 prior year representing decrease 752125 net loss two fiscal years net loss per share based basic diluted weighted average number common shares outstanding fiscal years ended june 30 2020 june 30 2019 000 cash flows cash equivalents 225381 june 30 2020 compared 71768 cash equivalents june 30 2019 respectively net cash used operating activities 1835859 fiscal year ended june 30 2020 compared 244324 fiscal year ended june 30 2019 respectively underlying reasons variance net cash used operating activities two periods mainly due change derivative liabilities amount 996551 resulting repayments convertible promissory notes stock conversion decrease assets prepaid expenses amount 772239 current fiscal year plus decrease 752750 net loss operations two fiscal years cash provided used investing activities fiscal years ended june 30 2020 june 30 2019 net cash provided financing activities 1989471 fiscal year ended june 30 2020 compared 302154 fiscal year ended june 30 respectively net cash provided financing activities current fiscal year primarily came loans officers directors amount 805377 loans notes payable 64250 399980 issuance common stock historical financing arrangements short term notes payable issuance common stock course business company obtained shortterm loans individuals institutional investors time raised money issuing restricted common stock company auspices rule 144 notes bear interest rates ranging 0 36 per annum notes 8 13 convertible promissory notes company also time issued convertible promissory notes various private investment funds shortterm working capital special projects typically notes bear interest rates 5 12 per annum mature within one year convertible common stock company discount ranging 42 50 may repaid within 180 days prepayment premium ranging 130 150 note 8 company’s plan operation following 12 months next twelve months company’s goals create number subfunds philux global funds sca sicavraif investment real estate renewable energy agriculture infrastructure healthcare well develop asia diamond exchange vietnam addition company continue carry merger acquisition program acquiring target companies rollup strategy also invest special situations moreover company continue provide advisory consulting services international clients wholly owned subsidiary philux capital advisors inc formerly known phi capital holdings inc financial plans material cash requirements must raise substantial amounts capital fulfill plans philux global funds acquisitions intend use equity debt project financing meet capital needs acquisitions investments management taken action formulated plans meet company’s operating needs june 30 2022 beyond working capital cash requirements next 12 months expected generated operations sale marketable securities additional financing company plans generate revenues consulting services merger acquisition advisory services acquisitions target companies cash flows available future financing arrangements company may use various sources funds including shortterm loans longterm debt equity capital project financing may necessary company believes able secure required capital implement business plan equity line facility march 6 2017 phi group inc nevada corporation “company” azure capital massachusetts corporation “investor” entered investment agreement “investment agreement” registration rights agreement “registration rights agreement” dated march 6 2017 company investor pursuant investment agreement investor committed purchase subject certain restrictions conditions 10000000 worth company’s common stock period 36 months effectiveness registration statement registering resale shares purchased investor pursuant investment agreement company agreed initially reserve 20000000 shares common stock issuance investor pursuant investment agreement event company cannot register sufficient number shares common stock issuance pursuant investment agreement company use best efforts authorize reserve issuance number shares required company perform obligations connection investment agreement soon reasonable practical company may discretion draw facility time company determines appropriate accordance terms conditions investment agreement maximum number shares company entitled put investor one draw notice shall exceed shares purchase price 250000 200 average daily volume us market company’s common stock three 3 trading days prior applicable put notice date multiplied average three 3 daily closing prices immediately preceding put date calculated accordance investment agreement company may deliver notice subsequent put time pricing period prior put completed purchase price shall set ninetyfour percent 94 lowest daily volume weighted average price vwap company’s common stock five 5 consecutive trading days immediately following put notice date put notice submitted investor company shall specify suspension price put event price company’s common stock falls suspension price put shall temporarily suspended put shall resume time price company’s common stock suspension price provided dates pricing period particular put still valid event pricing period complete shares suspension price due investor shall sold investor company suspension price terms investment agreement suspension price put may changed company submitted investor put restrictions applied days draw notice date closing date respect particular put time company shall entitled deliver another draw notice addition investor obligated purchase shares investor’s total number shares beneficially held time would exceed 499 number shares company’s common stock determined accordance rule 13d1j securities exchange act 1934 amended addition company permitted draw facility unless effective registration statement cover resale shares investment agreement also contains customary representations warranties parties assertions embodied representations warranties made purposes investment agreement subject qualifications limitations agreed parties connection negotiating terms investment agreement investment agreement provides company investor entitled customary indemnification among things losses liabilities may suffer result breach party provisions investment agreement registration rights agreement defined investor read investment agreement together information concerning company publicly files reports statements securities exchange commission “sec” pursuant terms registration rights agreement company obligated file one registrations statements sec within twentyone 21 days date registration rights agreement register resale investor shares common stock issued issuable investment agreement addition company obligated use commercially reasonable efforts registration statement declared effective sec within 90 days registration statement filed investment agreement amended august 3 2017 allow reservation 65445000 shares company’s common stock issuance investor pursuant corrected investment agreement company filed s1 registration statement securities exchange commission include 7936600 shares common stock issuance connection first tranche equity line facility s1 registration statement amended declared effective securities exchange commission january 11 2018 day report company accessed equity line facility funding item 7a item 7a quantitative qualitative disclosures market risk following discussion phi group inc’s market risk involves forwardlooking statements actual results could differ materially projected forwardlooking statements currency fluctuations foreign currency risk operations conducted vietnam indonesia using vietnamese dong indonesian rupiah official currencies countries effect fluctuations exchange rates considered minimal business operations interest rate risk significant interest rate risk debt obligations primarily shortterm nature individuals fixed interest rates valuation securities risk since majority income paid marketable securities value assets may fluctuate significantly depending market value securities hold item 8 item 7a quantitative qualitative disclosures market risk following discussion providential holdings inc’s market risk involves forwardlooking statements actual results could differ materially projected forwardlooking statements currency fluctuations foreign currency risk operations conducted vietnam using vietnamese dong official currency vietnam effect fluctuations exchange rates considered minimal business operations interest rate risk significant interest rate risk debt obligations primarily shortterm nature individuals fixed interest rates valuation securities risk since majority income paid marketable securities value assets may fluctuate significantly depending market value securities hold item 8 item 7a quantitative qualitative disclosures market risk following discussion phi group inc’s market risk involves forwardlooking statements actual results could differ materially projected forwardlooking statements currency fluctuations foreign currency risk operations conducted vietnam using vietnamese dong official currency vietnam effect fluctuations exchange rates considered minimal business operations interest rate risk significant interest rate risk debt obligations primarily shortterm nature individuals fixed interest rates valuation securities risk since majority income paid marketable securities value assets may fluctuate significantly depending market value securities hold item 8 item 7a quantitative qualitative disclosures market risk following discussion phi group inc’s market risk involves forwardlooking statements actual results could differ materially projected forwardlooking statements currency fluctuations foreign currency risk acquisition targets partner companies located outside united states use currencies us dollar official currencies countries fluctuations exchange rates countries may affect value business interest rate risk significant interest rate risk debt obligations primarily shortterm nature individuals fixed interest rates valuation securities risk since majority income paid marketable securities value assets may fluctuate significantly depending market value securities hold item 8 item 7a quantitative qualitative disclosures market risk following discussion phi group inc’s market risk involves forwardlooking statements actual results could differ materially projected forwardlooking statements currency fluctuations foreign currency risk operations conducted vietnam indonesia using vietnamese dong indonesian rupiah official currencies countries effect fluctuations exchange rates considered minimal business operations interest rate risk significant interest rate risk debt obligations primarily shortterm nature individuals fixed interest rates valuation securities risk since majority income paid marketable securities value assets may fluctuate significantly depending market value securities hold item 8 item 7a quantitative qualitative disclosures market risk following discussion phi group inc’s market risk involves forwardlooking statements actual results could differ materially projected forwardlooking statements currency fluctuations foreign currency risk acquisition targets partner companies located outside united states use currencies us dollar official currencies countries fluctuations exchange rates countries may affect value business interest rate risk significant interest rate risk debt obligations primarily shortterm nature individuals fixed interest rates valuation securities risk since majority income paid marketable securities value assets may fluctuate significantly depending market value securities hold item 8 item 7a quantitative qualitative disclosures market risk following discussion phi group inc’s market risk involves forwardlooking statements actual results could differ materially projected forwardlooking statements currency fluctuations foreign currency risk acquisition targets partner companies located outside united states use currencies us dollar official currencies countries fluctuations exchange rates countries may affect value business interest rate risk significant interest rate risk debt obligations primarily shortterm nature individuals fixed interest rates valuation securities risk since income past paid marketable securities value assets may fluctuate significantly depending market value securities hold item 8 item 7a quantitative qualitative disclosures market risk following discussion phi group inc’s market risk involves forwardlooking statements actual results could differ materially projected forwardlooking statements currency fluctuations foreign currency risk operations conducted vietnam using vietnamese dong official currency vietnam effect fluctuations exchange rates considered minimal business operations interest rate risk significant interest rate risk debt obligations primarily shortterm nature individuals fixed interest rates valuation securities risk since majority income paid marketable securities value assets may fluctuate significantly depending market value securities hold item 8 item 7a quantitative qualitative disclosures market risk following discussion phi group inc’s market risk involves forwardlooking statements actual results could differ materially projected forwardlooking statements currency fluctuations foreign currency risk operations conducted vietnam indonesia using vietnamese dong indonesian rupiah official currencies countries effect fluctuations exchange rates considered minimal business operations interest rate risk significant interest rate risk debt obligations primarily shortterm nature individuals fixed interest rates valuation securities risk since majority income paid marketable securities value assets may fluctuate significantly depending market value securities hold item 8 item 7a quantitative qualitative disclosures market risk following discussion phi group inc’s market risk involves forwardlooking statements actual results could differ materially projected forwardlooking statements currency fluctuations foreign currency risk operations conducted vietnam indonesia using vietnamese dong indonesian rupiah official currencies countries effect fluctuations exchange rates considered minimal business operations interest rate risk significant interest rate risk debt obligations primarily shortterm nature individuals fixed interest rates valuation securities risk since majority income paid marketable securities value assets may fluctuate significantly depending market value securities hold item 8 item 7a quantitative qualitative disclosures market risk following discussion phi group inc’s market risk involves forwardlooking statements actual results could differ materially projected forwardlooking statements currency fluctuations foreign currency risk acquisition targets partner companies located outside united states use currencies us dollar official currencies countries fluctuations exchange rates countries may affect value business interest rate risk significant interest rate risk debt obligations primarily shortterm nature individuals fixed interest rates valuation securities risk since majority income paid marketable securities value assets may fluctuate significantly depending market value securities hold item 8 item 7a quantitative qualitative disclosures market risk following discussion phi group inc’s market risk involves forwardlooking statements actual results could differ materially projected forwardlooking statements currency fluctuations foreign currency risk operations conducted vietnam using vietnamese dong official currency vietnam effect fluctuations exchange rates considered minimal business operations interest rate risk significant interest rate risk debt obligations primarily shortterm nature individuals fixed interest rates valuation securities risk since majority income paid marketable securities value assets may fluctuate significantly depending market value securities hold item 8 item 7a quantitative qualitative disclosures market risk following discussion phi group inc’s market risk involves forwardlooking statements actual results could differ materially projected forwardlooking statements currency fluctuations foreign currency risk acquisition targets partner companies located outside united states use currencies us dollar official currencies countries fluctuations exchange rates countries may affect value business interest rate risk significant interest rate risk debt obligations primarily shortterm nature individuals fixed interest rates valuation securities risk since income past paid marketable securities value assets may fluctuate significantly depending market value securities hold item 8 item 8 financial statements phi group inc independent auditor’s report board directors stockholders phi group inc formerly providential holdings inc independent auditors’ report audited accompanying consolidated balance sheets phi group inc nevada corporation subsidiary june 30 2015 2014 related consolidated statements operations stockholders’ equity cash flows years ended june 30 2015 2014 consolidated financial statements responsibility company’s management responsibility express opinion consolidated financial statements based audits management’s responsibility financial statements management responsible preparation fair presentation financial statements accordance accounting principles generally accepted united states america includes design implementation maintenance internal control relevant preparation fair presentation financial statements free material misstatement whether due fraud error auditor’s responsibility express opinion financial statements based audits conducted audits accordance standards public company auditing oversight board standards require plan perform audit obtain reasonable assurance whether financial statements free material misstatement audit involves performing procedures obtain audit evidence amounts disclosures financial statements procedures selected depend auditor’s judgment including assessment risks material misstatement financial statements whether due fraud error making risk assessments auditor considers internal control relevant entity’s preparation fair presentation financial statements order design audit procedures appropriate circumstances purpose expressing opinion effectiveness entity’s internal control accordingly express opinion audit also includes evaluating appropriateness accounting policies used reasonableness significant accounting estimates made management well evaluating overall presentation financial statements believe audit evidence obtained sufficient appropriate provide basis audit opinion consolidated financial statements referred present fairly material respects consolidated financial position phi group inc subsidiary june 30 2015 2014 results consolidated operations cash flows years ended june 30 2015 2014 conformity accounting principles generally accepted united states america company’s financial statements prepared using generally accepted accounting principles applicable going concern contemplates realization assets liquidation liabilities normal course business company accumulated deficit 37679736 negative cash flow operations amounting 1368915 year ended june 30 2015 factors discussed note 21 consolidated financial statements raise substantial doubt company’s ability continue going concern management’s plans regard matters also described note 21 consolidated financial statements include adjustments might result outcome uncertainties dave banerjee cpa dave banerjee cpa accountancy corp woodland hills california september 28 phi group inc subsidiaries consolidated balance sheets audited accompanying notes form integral part audited consolidated financial statements phi group inc subsidiaries consolidated statement operations years ended june 30 2015 2014 audited accompanying notes form integral part audited consolidated financial statements phi group inc subsidiaries statement stockholders’ equity deficit years ended june 30 2015 2014 audited accompanying notes form integral part audited consolidated financial statements phi group inc subsidiaries consolidated statements cash flows years ended june 30 2015 2014 audited accompanying notes form integral part audited consolidated financial statements phi group inc subsidiaries formerly providential holdings inc notes consolidated financial statements note 1 nature business established june 1982 phi group inc “company” “phi” nevada corporation primarily engaged energy natural resources wwwphiglobalcom company adopted longterm plan acquire energyrelated assets natural resources partner companies develop energy projects select geographical areas provide renewable energy solutions including biomass wind solar power technologies company also provides corporate finance services including merger acquisition advisory consulting services arranges capital client companies wholly owned subsidiary phi capital holdings inc wwwphicapitalholdingscom addition company also participates international trade activity company originally incorporated name jr consulting inc initially engaged mergers acquisitions operating subsidiary diva entertainment inc operated two modeling agencies one new york one california following business combination providential securities inc californiabased brokerage firm late 1999 company changed name providential securities inc nevada january 2000 company changed name providential holdings inc february 2000 october 2000 providential securities withdrew securities brokerage membership ceased financial services business subsequently april 2009 company changed name phi group inc october 2000 october 2011 company engaged mergers acquisitions advisory consulting services real estate hospitality development mining oil gas telecommunications technology healthcare private equity special situations beginning october 2011 company discontinued operations providential vietnam ltd philand ranch limited together subsidiaries philand ranch singapore philand corporation philand vietnam ltd phi gold corporation formerly phi mining corporation phi energy corporation mainly focusing energy business natural resources including investing andor developing energy assets independent power plant projects renewable energy industrial minerals international trade addition phi capital holdings inc company’s wholly owned subsidiary continues provide corporate project finance services including merger acquisition advisory consulting services arranging capital companies variety industries assurances made company successful achieving plan note 2 summary significant accounting policies principles consolidation consolidated financial statements include accounts phi group inc wholly owned subsidiary phi capital holdings inc discontinued operations providential securities inc phi energy corporation phi gold corp providential vietnam ltd philand ranch limited including 100 owned subsidiary philand corporation philand vietnam ltd collectively referred “company” significant intercompany transactions eliminated consolidation provimex inc touchlink communications inactive use estimates preparation consolidated financial statements conformity accounting principles generally accepted united states america requires management make estimates assumptions affect reported amounts assets liabilities disclosure contingent assets liabilities date financial statements reported amounts revenues expenses reporting period actual results could differ estimates cash equivalents company considers liquid investments maturity three months less date purchase readily convertible cash equivalents marketable securities company’s securities classified availableforsale carried fair value securities classified availableforsale may sold response changes interest rates liquidity needs purposes investment marketable securities represents less twenty percent 20 outstanding common stock equivalents investee security nationally quoted finra’s otc bulletin board “otcbb” otc markets investment accounted accordance provisions asc 320 previously sfas 115 unrealized holding gains losses availableforsale securities excluded earnings reported separate component stockholder’s equity realized gains losses securities classified availableforsale reported earnings based upon adjusted cost specific security sold june 30 2015 2014 marketable securities recorded 350556 261360 respectively based upon fair value marketable securities time accounts receivable management reviews composition accounts receivable analyzes historical bad debts june 30 2015 company accounts receivable impairment longlived assets effective january 1 2002 company adopted asc 350 previously sfas 144 “accounting impairment disposal longlived assets” addresses financial accounting reporting impairment disposal longlived assets supersedes sfas 121 “accounting impairment longlived assets longlived assets disposed of” accounting reporting provisions apb opinion 30 “reporting results operations disposal segment business” company periodically evaluates carrying value longlived assets held used accordance asc 350 asc 350 requires impairment losses recorded longlived assets used operations indicators impairment present undiscounted cash flows estimated generated assets less assets’ carrying amounts event loss recognized based amount carrying amount exceeds fair market value longlived assets loss longlived assets disposed determined similar manner except fair market values reduced cost disposal property equipment property equipment stated cost maintenance repair costs charged expense incurred costs major additions betterments capitalized property equipment sold otherwise disposed cost related accumulated depreciation eliminated accounts resulting gain loss reflected income depreciation computed using straightline method estimated useful lives assets ranging three ten years depreciation amortization cost property equipment depreciated estimated useful lives related assets depreciation amortization fixed assets computed straightline basis net earnings loss per share company adopted provisions asc 260 previously sfas 128 asc 260 eliminates presentation primary fully diluted earnings per share “eps” requires presentation basic diluted eps basic eps computed dividing income loss available common stockholders weightedaverage number common shares outstanding period diluted eps based weightedaverage number shares common stock outstanding period common stock equivalents outstanding end period net earnings loss per share computed follows stockbased compensation effective july 1 2006 company adopted asc 7181025 previously sfas 123r accordingly adopted modified prospective application method asc 7181025 applied new awards modified repurchased cancelled effective date additionally compensation cost portion awards outstanding date adoption requisite service rendered unvested options recognized period time remaining requisite services rendered fair value financial instruments fair value definition hierarchy fair value defined price would received sell asset paid transfer liability orderly transaction market participants measurement date assets liabilities measured fair value categorized based whether inputs observable market degree inputs observable categorization financial assets liabilities within valuation hierarchy based upon lowest level input significant fair value measurement fair value hierarchy inputs used measuring fair value maximizes use observable inputs minimizes use unobservable inputs requiring observable inputs used available valuation techniques consistent market income approach used measure fair value fair value hierarchy categorized three levels based inputs follows level 1 valuations based unadjusted quoted prices active markets identical assets liabilities fund ability access level 2 valuations based inputs quoted prices included level 1 observable either directly indirectly level 3 valuations based inputs unobservable significant overall fair value measurement fair value marketbased measure based assumptions prices inputs considered perspective market participant current measurement date rather entityspecific measure therefore even market assumptions readily available company’s assumptions set reflect market participants would use pricing asset liability measurement date availability valuation techniques observable inputs vary investment affected wide variety factors including type investment whether investment new yet established marketplace liquidity markets characteristics particular transaction extent valuation based upon models inputs less observable unobservable market determination fair value requires judgment inherent uncertainty valuation estimated values may materially higher lower values would used ready market investments existed accordingly degree judgment exercised fund determining fair value greatest investments categorized level 3 certain cases inputs used measure fair value may fall different levels fair value hierarchy cases level fair value hierarchy fair value measurement falls entirety determined based upon lowest level input significant fair value measurement fair value valuation techniques inputs company holds may invest public securities traded public exchanges overthecounter otc private securities real estate convertible securities interest bearing securities types securities adopted specific techniques respective valuations equity securities public companies unrestricted company values investments securities freely tradable listed major securities exchanges last reported sales price valuation date extent securities actively traded valuation adjustments applied categorized level 1 fair value hierarchy securities traded inactive markets valued reference similar instruments generally categorized level 2 3 fair value hierarchy restricted securities traded public exchanges overthecounter otc formal restrictions limit ie rule 144 holding periods underwriter’s lockups sale shall valued closing price date valuation less applicable discounts company may apply discount securities rule 144 restrictions additional discounts may assessed company believes mitigating factors warrant additional discounting determining potential additional discounts factors taken consideration include limited securities’ trading characteristics volume length overall impact restriction well macroeconomic factors valuations discounted appropriately securities may freely traded determined exchange otc listed price accurately reflect fair market value company may elect treat security private company apply alternative valuation method investments restricted securities public companies may included level 2 fair value hierarchy however extent significant inputs used determine liquidity discounts observable investments restricted securities public companies may categorized level 3 fair value hierarchy company’s financial instruments primarily consist cash equivalents accounts receivable marketable securities accounts payable balance sheet dates estimated fair values financial instruments materially different carrying values presented balance sheet primarily attributed short maturities instruments effective july 1 2008 company adopted asc 820 previously sfas 157 fair value measurements adopted statement assets liabilities shown table asc 820 clarifies definition fair value prescribes methods measuring fair value establishes fair value hierarchy based inputs used measure fair value expands disclosures use fair value measurements adoption asc 820 material impact fair value measurements asc 820 permits company defer recognition measurement nonfinancial assets nonfinancial liabilities january 1 2010 june 30 2015 company nonfinancial assets nonfinancial liabilities recognized disclosed fair value asc 820 requires financial assets liabilities reported fair value categorized one types investments based upon methodology mentioned level 1 level 2 level 3 determining fair value assets measured fair value recurring basis summarized company financial liabilities measured fair value recurring basis availableforsale securities company uses various approaches measure fair value availableforsale securities applying threelevel valuation hierarchy disclosures specified asc 820 level 1 securities measured using quoted prices active markets identical assets liabilities company’s policy regarding transfers andor level 3 depends trading activity security volatility security observable units clearly represents fair value security level 3 security measured using fairly represented fair value transfer securities either level 1 level 2 depending type inputs revenue recognition company’s revenue recognition policies compliance asc 13 previously staff accounting bulletin sab 104 company recognizes consulting advisory fee revenues transaction completed service fees earned expenses recognized period corresponding liability incurred payments received relevant criteria revenue recognition recorded unearned revenue advertising company expenses advertising costs incurred advertising costs years ended june 30 2015 2014 4350 5195 respectively comprehensive income loss asc 2201045 previously sfas 130 reporting comprehensive income establishes standards reporting display comprehensive income components accumulated balances comprehensive income defined include changes equity except resulting investments owners distributions owners among disclosures sfas 130 requires items required recognized current accounting standards components comprehensive income reported financial statement displayed prominence financial statements june 30 2015 2014 respectively accumulated comprehensive income 99341 accumulated comprehensive loss 709183 presented accompanying consolidated balance sheets income taxes company accounts income taxes accordance asc 740 previously sfas 109 “accounting income taxes” deferred taxes provided liability method whereby deferred tax assets recognized deductible temporary differences deferred tax liabilities recognized taxable temporary differences temporary differences reported amounts assets liabilities tax bases deferred tax assets reduced valuation allowance opinion management likely portion deferred tax assets realized deferred tax assets liabilities adjusted effects changes tax laws rates date enactment reporting segments asc 280 previously statement financial accounting standards 131 disclosures segments enterprise related information supersedes statement financial accounting standards 14 financial reporting segments business enterprise establishes standards way public enterprises report information operating segments annual financial statements requires reporting selected information operating segments interim financial statements regarding products services geographic areas major customers asc 280 defines operating segments components enterprise separate financial information available evaluated regularly chief operating decision maker deciding allocate resources assessing performance company operated one segment generated revenues years ended june 30 2015 2014 risks uncertainties normal course business company subject certain risks uncertainties company provides service receives marketable securities upon execution transactions consequently value securities received customers affected economic fluctuations customer’s business growth actual realized value securities could significantly different recorded value recent accounting pronouncements update 201311income taxes topic 740 presentation unrecognized tax benefit net operating loss carryforward similar tax loss tax credit carryforward exists consensus fasb emerging issues task force download july effective fiscal years interim periods within years beginning december 15 2013 nonpublic entities amendments effective fiscal years interim periods within years beginning december 15 2014 early adoption permitted update 201309fair value measurement topic 820 deferral effective date certain disclosures nonpublic employee benefit plans update 201104 download july deferral amendment effective upon issuance financial statements issued update 201307presentation financial statements topic 205 liquidation basis accounting download april effective entities determine liquidation imminent annual reporting periods beginning december 15 2013 early adoption permitted update 201304liabilities topic 405 obligations resulting joint several liability arrangements total amount obligation fixed reporting date consensus fasb emerging issues task force download february effective fiscal years interim periods within years beginning december 15 2013 nonpublic entities amendments effective fiscal years ending december 15 2014 interim periods annual periods thereafter update 201302comprehensive income topic 220 reporting amounts reclassified accumulated comprehensive income download february public entities amendments effective prospectively reporting periods beginning december 15 2012 nonpublic entities amendments effective prospectively reporting periods beginning december 15 2013 early adoption permitted update 201301balance sheet topic 210 clarifying scope disclosures offsetting assets liabilities download january entity required apply amendments fiscal years beginning january 1 2013 interim periods within annual periods entity provide required disclosures retrospectively comparative periods presented effective date effective date update 201111 company either evaluated currently evaluating implications pronouncements possible impact may company’s financial statements cases management determined pronouncement either limited application company cases implementation would material impact financial statements taken whole note 3 loans receivable loans receivable consist following june 30 2015 2014 note 4 assets comprise following june 30 2015 2014 fiscal year ended june 30 2011 philand vietnam ltd wholly owned subsidiary philand ranch ltd made security deposit amount 172203 chu lai open economic zone authority quang nam province vietnam guarantee pointe91 development project bien rang chu lai nui thanh district quang nam province vietnam amount later transferred ky ha chu lai investment development llc “khclidc” deposit clearing land resettlement residents pointe91 project area result discontinuance pointe91 development project company supposed receive refund deposit amount less expenses incurred connection land clearing resettlement activity philand vietnam ltd received repayments khclidc totaling approximately 99160 june 30 2014 wrote balance 73043 june 30 2015 year ended june 30 2011 company signed consulting agreement assist agent155 media corp delaware corporation respect corporate restructuring business combination freshwater technologies inc nevada corporation part restructuring requirements company made payment manning elliot llp amount 24476 behalf freshwater technologies inc loan amounts agent155 media corp june 30 2014 president agent155 media corp assumed balance 66955 agent155 media corp personal obligations company january 10 2013 company issued 3288443 shares restricted common stock deposit towards total purchase price 70 equity interest pt tambang sekarsa adadaya recorded value shares par total 3288 shares cancelled last quarter fiscal year ended june 30 2015 june 30 2015 total amounts owed president agent155 media corp deposit acquisition investment subsidiary collectively reported assets totaling 77729 note 5 marketable equity securities available sale company’s marketable securities classified availableforsale carried fair value securities comprised shares common stock investee securities classified availableforsale may sold response changes interest rates liquidity needs purposes investment marketable securities represents less twenty percent 20 outstanding common stock equivalents investee security nationally quoted national association securities dealers otc bulletin board “otcbb” pink sheets investment accounted accordance provisions sfas 115 marketable securities classified available sale june 30 2015 consisted 38197971 shares myson group inc formerly vanguard mining corporation public company traded otc markets trading symbol mysn 900 shares intel corporation nasdaqintc fair value marketable securities recorded june 30 2015 350556 fiscal year ended june 30 2015 total 3833360 shares myson group inc formerly vanguard mining corp transferred level 3 level 2 due reclassification restricted unrestricted status based cost basis 0025 price 0050 securities time transfer net increase market value securities time transfer 95834 change unrealized appreciation depreciation related level 2 investments still held june 30 2015 184200 level 2 securities sold year sold net realized loss 45176 note 6 property equipment june 30 2015 june 30 2014 company property equipment note 7 discontinued operations june 30 2012 company decided recognize businesses phi gold corp formerly phi mining corporation providential vietnam ltd phi energy corp philand ranch ltd united kingdom corporation together whollyowned subsidiaries philand corporation usa philand ranch ltd singapore philand vietnam ltd discontinued operations practical business accounting purposes june 30 2013 company recorded total 2234327 liabilities potential liability contingencies wrote nonperforming assets associated discontinued operations june 30 2015 company balance 1045232 liabilities discontinued operations note 8 accounts payable accrued expenses accounts payable accrued expenses june 30 2015 2014 consist following note 9 due officer due officer represents advances made officers company subsidiaries noninterest bearing except 100000 described unsecured due demand june 30 2015 2014 balances 1879458 1858402 respectively june 30 2015 company short term note payable amounting 100000 interest bearing 3000 per month payable member board directors note 10 loans promissory notes short term notes payable june 30 2015 june 30 2014 company shortterm notes payable amounting 1342618 1346721 accrued interest 3188890 respectively notes bear interest rates ranging 6 36 per annum notes payable secured assets company summarized convertible promissory note last convertible promissory note issued asher enterprises inc “asher” june 17 2011 42500 interest 8 per annum due payable march 21 2012 note convertible election asher time issuance date 39 discount average lowest closing bid prices company’s common stock ten trading day period ending latest complete trading prior conversion date event default amount principal interest paid due bear interest rate 22 per annum note becomes immediately due payable occur company liable pay asher 150 outstanding principal interest note agreements contain covenants requiring asher’s written consent certain activities existence committed company issue date note outstanding note principal interest amounts accrued thereon converted whole part time asher issuance date equivalent company’s common stock determined discount rate mentioned note additionally note contains reset provision exercise price conversion price company issues equity derivatives price less exercise price set forth warrants note ratchet provision results derivative liability financial statements july 25 2011 10000 principal convertible note issued january 11 2011 converted equivalent 1550 shares postsplit common stock company 2325581 presplit shares august 8 2011 12000 principal convertible note issued january 11 2011 converted equivalent 1633 shares postsplit common stock company 2448980 presplit shares august 30 2011 15000 principal convertible note issued january 11 2011 converted equivalent 2941 shares postsplit common stock company 4411765 presplit shares october 21 2011 8000 principal convertible note issued january 11 2011 converted equivalent 2667 shares postsplit common stock company 4000000 presplit shares november 22 2011 10000 principal convertible note issued january 11 2011 converted equivalent 5083 shares postsplit common stock company 7625000 presplit shares january 03 2012 10000 principal convertible note issued june 17 2011 converted equivalent 4444 shares postsplit common stock company 6666667 presplit shares january 11 2012 11000 principal convertible note issued june 17 2011 converted equivalent 5641 shares postsplit common stock company 8461538 presplit shares march 1 2012 12000 principal convertible note issued june 17 2011 converted equivalent 5741 shares postsplit common stock company 8571429 presplit shares april 23 2012 asher enterprises inc converted 7000 principal amount convertible note dated june 17 2011 8197 shares postsplit common stock company price 0854 per share quarter ended march 31 2015 asher enterprises inc converted total 4700 principal accrued interest 77049 shares common stock company price 0061 per share june 30 2015 last convertible promissory note issued asher enterprises inc june 17 2011 paid full due preferred stockholders company classified 215000 preferred stock subscribed current liability payable holders preferred stock previously discontinued subsidiary company due deficiency compliance preferred shares subscription agreement connection referenced subsidiary year 2000 company made offer preferred stock holders receive shares common stock company exchange preferred shares far small number preferred shareholders accepted offer interest expenses payable holders preferred stock 387455 361655 included accrued interest included accrued expenses balance sheets june 30 2015 june 30 2014 respectively advances customers previously classified unearned revenue september 30 2012 company decided reclassify previously recorded unearned revenues advances customers company able complete consulting services related clients due inability provide gaapcompliant audited financial statements order file registration statement securities exchange commission june 30 2015 company recorded 563219 advances customers note 11 litigation legal proceeding settled unpaid june 30 2015 quang van cao nhan thi nguyen cao vs providential securities inc et al case originally submitted orange county superior court ca june 25 1997 case 781121 subsequently moved nasd dispute resolution arbitration august 24 2000 company’s legal counsel negotiated claimant’s counsel unilaterally reached settlement approved company process renegotiating terms said settlement claimants filed request arbitration hearing national association securities dealers october 4 2000 case 9903160 thereafter claimants filed complaint orange county superior court ca october 31 2000 case 00cc13067 alleged breach contract damages sum 75000 plus prejudgment interest costs incurred connection complaint relief without admitting denying allegations company reached settlement agreement claimants whereby company would pay claimants total 62500 plus 4500 administrative costs date report company paid 2500 subject entry judgment 79000 may 2011 claimants filed application renewal judgment total 14049078 june 30 2015 company accrued 172091 potential liabilities connection case accompanying consolidated financial statements william davidson vs doan et al february 01 2010 company notified suit filed superior court state california county los angeles november 24 2009 william davidson individual martin doan henry fahman benjamin tran hrciti corporation providential capital inc collectively referred “defendants” case bc 426831 plaintiff demanded amount less 14000000 defendants promissory notes outstanding plaintiff company july 09 2012 william davidson phi capital holdings inc formerly providential capital inc subsidiary company reached settlement agreement respect whereby phi capital agreed pay william davidson total 200000 period nineteen months beginning september 1 2012 since november 30 2012 william davidson converted portions total amount common stock phi group inc lieu cash payment company accrued required liabilities associated balance notes accompanying consolidated financial statements june 30 2015 note 12 payroll liabilities payroll liabilities accrued recorded accrued expenses consolidated balance sheet quarter ended june 30 2014 company paid 4197422 internal revenue service 1928994 state california employment development department towards balance 118399 payroll tax penalties interest claimed agencies company currently working internal revenue service state california employment department resolve remaining balance note 13 basic diluted net loss per share net loss per share calculated accordance sfas 128 “earnings per share” provision sfas 128 basic net loss per share computed dividing net loss period weightedaverage number common shares outstanding period diluted eps based weightedaverage number shares common stock outstanding period common stock equivalents outstanding end period basic diluted weighted average numbers shares year ended june 30 2015 since inclusion common stock equivalents antidilutive note 14 stockholder’s equity total number authorized capital stock company 400000000 shares par value 0001 per share consisting 300000000 shares voting common stock par value 0001 per share 100000000 shares preferred stock par value 0001 per share rights terms associated preferred stock determined board directors company march 15 2012 company effectuated 1 1500 reverse split company’s common stock treasury stock balance treasury stock june 30 2015 3289 postsplit shares valued 3801 common stock july 19 2012 officer company converted total 307000 debts owed company 1196424 shares phi group inc’s restricted common stock july 31 2012 seven creditors company converted total 17733333 debts owed company 504865 shares phi group inc’s common stock november 19 2012 company reserved 5673327 shares common stock special dividend distribution november 30 2012 four creditors company converted total 22007906 debts owed company 81737 shares phi group inc’s common stock january 10 2013 company issued 3288443 shares phi group inc’s common stock registered name majority shareholder pt tambang sekarsa adadaya deposit towards total purchase price 70 equity interest pt tambang sekarsa adadaya february 14 2013 two creditors company converted total 150000 debts owed company 155885 shares phi group inc’s common stock february 22 2013 company issued 44763 shares phi group inc’s common stock valued 50000 indonesian attorney payment legal services connection purchase pt tambang sekarsa adadaya february 22 2013 creditor company converted total 33633 debts owed company 44844 shares phi group inc’s common stock april 11 2013 creditor company converted 50000 owed company 76540 shares phi group inc’s common stock april 26 2013 three creditors company converted total 180000 debts owed company 304913 shares phi group inc’s common stock may 10 2013 company issued 100887 shares restricted common stock 40000 cash rule 144 working capital july 1 2013 three creditors company converted total 177940 principal interest owed company 412569 shares common stock phi group inc february 11 2014 creditor company converted total 156750 debts owed company 337097 shares phi group inc’s common stock august 27 2014 creditor company converted total 2770626 shortterm notes accrued interest owed company 91440 shares phi group inc’s common stock january 22 2015 company issued 77049 shares 0001 par value common stock asher enterprises inc payment full balance principal accrued interest last convertible promissory note issued asher enterprises inc june 17 2011 february 10 2015 company issued 300000 restricted shares 0001 par value common stock shareholderinvestor cash may 14 2015 company cancelled 3288443 shares company’s 0001 par value common stock issued majority shareholder pt tambang sekarsa adadaya january 10 2013 deposit towards total purchase price 70 equity interest pt tambang sekarsa adadaya transaction terminated due unsatisfactory due diligence results june 30 2015 9584675 postsplit shares company’s 0001 par value common stock issued including 5673327 shares reserved special dividend distribution 3911348 shares outstanding respectively preferred stock preferred stock issued outstanding class preferred stock april 2 2015 company designated first fifty million 50000000 shares company’s previously authorized 100000000 shares preferred stock par value 0001 per share class cumulative convertible redeemable class preferred stock “class preferred stock” following rights terms 1 dividends holder class preferred stock entitled receive twelve percent 12 noncompounding cumulative dividends per annum payable semiannually 2 conversion share class preferred stock shall convertible company’s common stock time one year date issuance variable conversion price defined herein common stock “variable conversion price” shall mean 75 multiplied market price defined herein representing discount rate 25 “market price” means average trading price company’s common stock ten 10 tradingday period ending one trading day prior date conversion notice sent holder class preferred stock company via facsimile email “conversion date” “trading price” means security date closing price otc markets otcqb nasdaq stock markets nyse applicable trading market reported reliable reporting service “reporting service” mutually acceptable company holder class preferred stock 3 redemption rights company period two years date issuance may time redeem class preferred stock whole part option company’s board directors price equal one hundred twenty percent 120 original purchase price class preferred stock unit consisting shares class preferred stock warrants attached thereto plus case accumulated unpaid dividends date fixed redemption note 15 stockbased compensation plan february march 18 2015 company adopted employee benefit plan set aside 1000000 shares common stock eligible employees independent contractors company subsidiaries june 30 2015 company issued stock lieu cash plan note 16 gain loss settlement debts fiscal year ended june 30 2015 company recorded net loss amount 25845 conversion promissory notes creditors compared total gain 372278 settlement debts fiscal year ended june 30 2014 note 17 expense net expense fiscal year ended june 30 2015 consists following note 18 related party transactions company accrued 210000 salaries henry fahman president company tina phan secretary company years ended june 30 2015 june 30 2014 note 19 income taxes provision made income tax since company significant net operating loss carry forward june 30 2015 company incurred net operating losses tax purposes approximately 37679736 net operating loss carry forward may used reduce taxable income year 2031 net operating loss carry forwards state california generally available reduce taxable income year 2021 availability company’s net operating loss carryforward subject limitation 50 positive change ownership company’s stock see note 2 “under section 6501a internal revenue code tax code section 3016501a1a income tax regulations tax regulations irs required assess tax within 3 years tax return filed irs company’s 2015 tax return open may subject examination taxing authorities” note 20 contracts commitments business financial consulting agreement thinh hung investment co fiscal year ended june 30 2010 company signed agreement thinh hung investment co ltd vietnambased company assist thinh hung identifying locating possibly acquiring various business opportunities thinh co ltd subsidiary thinh hung including limited reverse merger stock swap business combination thinh publiclytraded company us exchange services rendered company would receive compensation cash thinh hung common stock combined company september 30 2011 company completed stock purchase investment agreement thinh anh co ltd vietnam foods corporation nevada corporation however combined company filed registration statement securities exchange commission become reporting company recognized 26656 revenues transaction balance 293219 booked customer advances liability portion balance sheet agreement colebrand international ltd january 28 2013 company signed business cooperation agreement colebrand international ltd company organized existing laws united kingdom cooperate international trade financial intermediation term agreement two years extended december 10 2015 agreement paca february 25 2013 phi capital holdings inc subsidiary company signed consultingengagement agreement paca new york corporation contemplate raising capital purpose financing phi group inc’s business plan including acquisition various energy properties general working capital term engagement two years extended february 24 2016 paca entitled cash success fee equity success fee successful financing transaction agreement pacific energy network august 16 2013 company signed business cooperation agreement pacific energy network inc washington corporation cooperate develop implement conventional renewable energy business projects geographical areas terms conditions mutually acceptable parties term agreement two years agreement ne nord energy joint stock company november 14 2013 company signed business cooperation investment agreement ne nord energy joint stock company vietnamese company cooperate codevelop invest cause invested produce market sell led lighting solar energy kinetic power supply system renewable energy energyrelated products services geographical areas markets deem economically beneficial parties term agreement two years business financial consulting agreement asia green corp january 17 2014 phi capital holdings inc whollyowned subsidiary company signed business financial consulting agreement asia green llc “asia green vn” vietnamese company engaged afforestation reforestation projects vietnam assist asia green becoming fully reporting publicly traded company united states arranging capital asia green execute business plan phi capital holdings entitled receive six hundred twenty thousand us dollars compensation services rendered term agreement one year asia green become fully reporting public company april 4 2014 touchlink communications inc nevada corporation majorityowned subsidiary company changed name asia green corporation entered corporate combination agreement asia green vn become holding company asia green vn’s agroforestry afforestation business july 28 2014 asia green corporation changed name omni resources inc pursue new business consulting engagement agreement vietnam mining corporation nka vanguard mining corporation january 24 2014 phi capital holdings inc whollyowned subsidiary company signed consulting engagement agreement vietnam mining corporation kna vanguard mining corporation “vnmc” nevada corporation assist vnmc regain current good standing status pertinent regulatory agencies united states certain private service providers seek new business opportunities vnmc phi capital holdings entitled receive four million presplit shares restricted common stock vnmc pursuant provisions rule 144 compensation services rendered term agreement six months quarter ended march 31 2015 phi capital holdings received sixteen million postsplit shares common stock vnmc compensation services rendered funding agreement regarding petrobras bonds february 4 2014 company signed funding agreement dieterich group robert terry provide 300000 likely increasing 400000 funding best efforts nonexclusive basis underwrite collection efforts undertaken series 500 bonds originally issued petrobras brazilian corporation focused oil gas exploration development bonds currently owned controlled starboard financial nevada llc recent valuation report bonds published discounted value 750000 including 7 interest february 2008 possible published redemption face value 2300000 according funding agreement company receive total recovery 10 times investment funding 125 net proceeds assuming entire funding provided company andor investors bond collections deduction trading selling expenses brazilian agents starboard financial brazilian parties received first 20000000 recovered date report proceeds collected bonds assumption debt agent155 media corp’s officer october 29 2014 christopher martinez president agent155 media corp personally assumed balance 66955 previously owed company agent155 media corp personal obligations retroactively december 31 2011 business cooperation investment agreement ag materials llc january 7 2015 company signed business cooperation investment agreement ag materials llc alabama limited liability company “agm” primarily cooperate establish operate 200000 mt wood pellet plant live oak suwannee county florida agm company intend utilize benefits agm’s previous arrangements klausner lumber one llc whollyowned subsidiary klausner group australian company purchase 400000 800000 short tons st feedstock per year klausner lumber one purchase fifteenacre parcel land build new wood pellet plant live oak suwannee county florida company responsible providing required capital purchase land machinery equipment accessories construction working capital new wood pellet plant agm company enter definitive agreement includes specific terms conditions obligations benefits representations warranties covenants indemnities customary transaction type parties incorporated cornerstone biomass corporation florida corporation entity manage jointventure wood pellet project live oak florida moreover agm company may time cooperate jointly engage business activities deem mutually acceptable beneficial parties purchase sale agreement pt mega kencana persada march 16 2015 company signed agreement purchase sale effective april 1 2015 pt mega kencana persada “mkpi” indonesian company majority shareholders “shareholders” acquire seventyfive percent 75 equity ownership rights explore mine limestone tenement approximate 330 hectares iup exploration license 540112k2012 dated january 27 2012 desa sipapaga kecamatan panyabungan kabupaten mandailing natal sumatra utara republic indonesia exchange 950000 cash 3800000 company’s class preferred stock valued 100 per share date report parties yet close purchase sale agreement business cooperation investment agreement cv berkat do’a mama may 1 2015 company signed business cooperation investment agreement “bcia” cv berkat do’a mama indonesian company 1 develop mine 6200hectare coal concession estimated deposits 3355 million mt kabupaten kapuas central kalimantan 2 build 30mw coalfired power plant kota jayapura provinsi papua indonesia 3 potentially build minemouth coalfired power plant kabupaten kapuas central kalimantan 4 supply coals indonesian domestic market countries particularly vietnam thailand malaysia japan india china bcia calls phi group inc sign conditional purchase sale agreement within twenty one days signing bcia acquire 70 equity ownership cv berkat do’a mama start drilling program two weeks signing conditional purchase sale agreement sign definitive purchase sale agreement thirty days drilling boring results confirmed additional due diligence review company decided pursue transaction continued vetting coal concessions acquisition longterm energy asset accumulation program consulting engagement agreement myson investment import export jsc may 7 2015 phi capital holdings inc wholly owned subsidiary company signed consulting engagement agreement myson investment import export joint stock company “myson jsc” vietnamese company provide consulting services assist myson jsc become fully reporting public company us stock market june 30 2015 phi capital holdings received 50000 cash defray costs associated services rendered 26166746 shares common stock myson group inc us public company traded otc markets trading symbol mysn business cooperation agreement master contract purchase sale sand kien hoang minerals joint stock company may 8 2015 company signed business cooperation agreement kien hoang minerals joint stock company ” khm jsc” vietnamese company develop expand international markets khm’s mineral products particularly exports reclamation sand granite singapore primearth resources asia pte ltd another strategic partner company’s company granted first right refusal khm purchase approximately 102 million cubic meters sand 40 million cubic meters granite june 12 2015 company signed master contract purchase sale 60 million cubic meters sand recovered dredging clearing traffic pathways de gi estuary surrounding areas binh dinh province vietnam period five years exports singapore asian markets consulting agreement sports pouch beverage company june 3 2015 phi capital holdings inc wholly owned subsidiary company signed consulting engagement agreement sports pouch beverage company “spbv” nevada corporation provide consulting services assist spbv respect business development mergers acquisitions corporate governance corporate finance phi capital holdings inc entitled receive forty percent common stock spbv compensation services rendered duration agreement one year agreement primeforth renewable energy ltd june 24 2015 phi capital holdings inc wholly owned subsidiary company signed consulting engagement agreement primeforth renewable energy ltd “primeforth” singaporean company provide consulting services respect corporate development corporate finance debt financing primeforth renewable energy phi capital holdings entitled onetime nonrefundable professional fee 20000 4 cash success fee financing arranged primeforth term agreement two years primeforth engaged developing alternative energy using patented microalgae technologies note 21 going concern uncertainty shown accompanying consolidated financial statements company accumulated deficit 37679736 june 30 2015 net loss operations 1368925 fiscal year ended june 30 2015 factors well uncertain conditions company faces daytoday operations respect cash flows create uncertainty company’s ability continue going concern financial statements include adjustments might necessary company unable continue going concern management taken action strengthen company’s working capital position generate sufficient cash meet operating needs june 30 2016 beyond next twelve months company intends focus implementing reclamation sand business vietnam singapore engaging international trade involving energy products industrial commodities precious metals continuing acquire energyrelated natural resource assets carry business cooperation investment agreements signed various international partners phi capital holdings inc company’s wholly owned subsidiary also continue provide corporate project finance services including merger acquisition advisory consulting services arranging funding client companies various industries company anticipates generating substantial amounts revenues reclamation sand business international trade advisory consulting activities mentioned herein assurances could made management would successful achieving plan president chairman company committed funding company’s operations various sources next 12 months note 22 subsequent event financial statements approved management available issuance september 25 2015 subsequent events evaluated date settlement agreement hai p nguyen july 16 2015 company signed settlement payment agreement hai p nguyen agreed pay latter 25000 cash 500000 shares common stock myson group inc compensation hai p nguyen’s portion contribution towards budget complete services connection consulting agreement dated january 24 2014 vietnam mining corporation known myson group inc phi capital holdings inc agreement defrayal expenses stock compensation asia green corporation july 17 2015 company signed agreement provide 75000 asia green corporation agmc” nevada corporation agmc pay certain required expenses resume status fully reporting company securities exchange commission exchange fund agmc agrees allocate 500000 shares common stock upon consummation business combination vietnamese company engaged agriculture reforestation master agreement business cooperation investment agreement rat sokhorn incorporation co ltd july 31 2015 company signed master agreement business cooperation investment agreement rat sokhorn incorporation co ltd cambodian company cooperate development implementation following projects 1 5160ha thermal coal concession sdach kong khang lech kanthaor khang cheung areas banteay meas kampong trach districts kampot province cambodia 2 minemouth coalfired power plant referenced coal concession 3 limestone concession sdach kong khang lech kanthaor khang cheung areas banteay meas kampong trach districts kampot province cambodia cement precipitated calcium carbonate 4 container seaport kampot province 5 exploration exploitation precious base metals cambodia company responsible arranging required capital technical expertise engineering procurement construction epc operations sales marketing connection proposed projects implementation one projects subject satisfactory due diligence feasibility study company’s management conducted site visits qualified technical professionals consulted royal haskoning dhv wwwroyalhaskoningdhvcom regarding projects business cooperation investment agreement cavico lao mining co ltd august 7 2015 company signed business cooperation investment agreement cavico lao mining co ltd “clm” provide initial required capital raised company’s 506c private placement clm’s interim operations budget conduct independent jorc report nickel portion clm’s 80hectare multimineral mine khoam bang mountainous area ban bo bulikhamsay laos people’s democratic republic addition company shall establish subsidiary holding company clm’s assets spun separate publicly traded company “pubco” nasdaq stock markets subject certain conditions requirements clm management believes estimated value nickel portion aforementioned multimineral mine approximately 15 billion 4 billion subject independent validation master agreement business cooperation dredge masters civil works august 19 2015 company signed agreement dredge masters civil works inc filipino corporation cooperate order optimize dredging transshipment loading shipping unloading saline sand large scales serve needs land reclamation singaporean asian countries term agreement one year stock purchase investment agreement vinabenny energy joint stock company september 1 2015 company signed agreement acquire 5010 equity ownership vinabenny energy joint stock company “vinabenny” vietnamese company 10700000 arrange capital vinabenny complete 84000 mt liquefied petroleum gas lpg terminal giuoc district long province vietnam final closing transaction scheduled occur december 31 2015 agreement redicsaco joint stock company september 11 2015 company signed principle business investment agreement redicsaco jsc vietnamese company cooperate respect dredging transshipment loading sale export saline reclamation sand ham luong river waterway ben tre province vietnam singapore brunei asian markets initial authorized volume sand location 25 million cubic meters total reserve 390 million cubic meters agreement hatico investment development joint stock company september 11 2015 company signed principle business cooperation agreement hatico investment development joint stock company vietnamese company cooperate order dredge sell export saline reclamation sand ha tien kien giang province vietnam develop deepwater seaport terminal location estimated volume sand location approximately one billion cubic meters parties agreed principle company acquire 5090 hatico percentage joint venture company set item 9 item 8 financial statements report independent registered public accounting firm board directors stockholders providential holdings inc audited accompanying consolidated balance sheet providential holdings inc nevada corporation subsidiaries june 30 2008 2007 related consolidated statements operations stockholders equity cash flows years ended june 30 2008 2007 consolidated financial statements responsibility companys management responsibility express opinion consolidated financial statements based audits conducted audit statements accordance standards public company accounting oversight board united states standards require plan perform audit obtain reasonable assurance whether financial statements free material misstatement audit includes examining test basis evidence supporting amounts disclosures financial statements audit also includes assessing accounting principles used significant estimates made management well evaluating overall financial statement presentation believe audits provide reasonable basis opinion consolidated financial statements referred present fairly material respects consolidated financial position providential holdings inc subsidiaries june 30 2008 results consolidated operations cash flows years ended june 30 2008 2007 conformity accounting principles generally accepted united states america companys financial statements prepared using generally accepted accounting principles applicable going concern contemplates realization assets liquidation liabilities normal course business company accumulated deficit 14990621 negative cash flow operations amounting 1782930 year ended june 30 2008 factors discussed note 19 consolidated financial statements raise substantial doubt companys ability continue going concern managements plans regard matters also described note 19 consolidated financial statements include adjustments might result outcome uncertainty kabani company inc certified public accountants los angeles california september 26 2008 accompanying notes form integral part consolidated financial statements providential holdings inc subsidiaries notes consolidated financial statements note 1 nature business providential holdings inc phi engaged number business activities important merger acquisition advisory services company acquires consolidates special opportunities selective industries create additional value acts incubator emerging companies technologies provides financial consultancy advisory services us foreign companies wholly owned division company provimex formed april 10 2001 name providential imex focus trade commerce vietnam division changed name provimex july 5 2001 subsidiary later incorporated nevada corporation september 23 2004 company declared 15 stock dividend provimex inc shareholders record september 15 2004 may 2003 company formed subsidiary name providential capital provide financial products services microsmall cap arenas manage companys proprietary merger acquisition activities providential capital focus attention underserved segment smaller companies united states abroad providential capital began providing merger acquisition advisory services clients since fiscal year ended june 30 2003 july 7 2003 whollyowned dba providential holdings inc touchlink communications formed provide pointofsale pos terminals prepaid calling cards retailers convenient stores nonprofit organizations across us pos system enables merchants participating partners offer prepaid products without purchasing storing inventory advance company later incorporated nevada corporation february 2004 name touchlink communications inc provide long distance services residential business customers united states company declared 15 stock dividend touchlink communications inc shareholders record september 15 2004 november 1 2003 company formed phi video corp later renamed phi digital corp phi digital nevada corporation provide sale consumer electronics including flatscreen television sets monitors phi digital renamed tulon industries inc change scope business subsidiary generate revenue fiscal years ended june 2005 2006 december 31 2003 company formed providential oil gas inc nevada corporation whollyowned subsidiary pursue independent oil gas business november 24 2005 providential oil gas inc signed agreement terrafirma gas oil inc nevada corporation headquarters midland texas codevelop twentyfour gas wells hudspeth ranch crockett county west texas 20000 investment made company project fiscal year ended june 30 2006 company wrote investment fiscalyear ended june 30 2007 june 14 2006 providential oil gas inc changed name providential energy corporation expand scope business potentially include alternative energy fuel cells biodiesel entity operations year ended june 30 2008 2007 july 2007 philand corporation nevada corporation whollyowned subsidiary company formed manage real estate development project south hoi quang nam province vietnam july 2007 providential holdings entered principle agreement people’s committee quang nam province allows company lease approximately 8000 acres land south hoi quang nam province vietnam develop integrated tourism zone 70year lease term philand corporation currently involved planning developing project providential holdings inc subsidiaries notes consolidated financial statements indochina mining corporation nevada corporation whollyowned subsidiary providential holdings inc incorporated march 20 2008 exploitation processing diatomite mines april 14 2008 indochina mining corporation imc entered cooperation agreement phu yen minerals joint stock company pymico agreement pymico imc cooperate contribute capital establishment joint venture specializing exploitation processing diatomite phu yen providence imc participate pymico purchasing maximum 30 shares pymico latter issues additional shares 2008 may 20 2008 providential vietnam vietnamese corporation whollyowned subsidiary company formed provide advisory services management consulting corporate restructuring asset management fund management investment banking services independent oil gas alternative energy mining commercial residential real estate hotels integrated hospitality investments selective opportunities potential high growth note 2 summary significant accounting policies principles consolidation consolidated financial statements include accounts providential holdings inc subsidiaries providential securities inc providential capital phi digital inc “phi digital” provimex providential energy corporation formerly providential oil gas inc touchlink indochina mining corporation philand corporation providential vietnam collectively referred company significant intercompany transactions eliminated consolidation providential securities inc phi digital provimex providential energy corporation touchlink indochina mining corporation inactive use estimates preparation consolidated financial statements conformity accounting principles generally accepted united states america requires management make estimates assumptions affect reported amounts assets liabilities disclosure contingent assets liabilities date financial statements reported amounts revenues expenses reporting period actual results could differ estimates cash equivalents company considers liquid investments maturity three months less date purchase readily convertible cash equivalents marketable securities companys securities classified availableforsale carried fair value securities classified availableforsale may sold response changes interest rates liquidity needs purposes investment marketable securities represents less twenty percent 20 outstanding common stock equivalents investee security nationally quoted national association securities dealers otc bulletin board otcbb pink sheets investment accounted accordance provisions sfas 115 unrealized holding gains losses availableforsale securities excluded earnings reported separate component stockholders equity realized gains losses securities classified availableforsale reported earnings based upon adjusted cost specific security sold june 30 2008 2007 marketable securities recorded 4435938 9666942 respectively based upon fair value marketable securities providential holdings inc subsidiaries notes consolidated financial statements accounts receivable company maintains reserves potential credit losses accounts receivable management reviews composition accounts receivable analyzes historical bad debts customer concentrations customer credit worthiness current economic trends changes customer payment patterns evaluate adequacy reserves recorded primarily specific identification basis june 30 2008 company balance 3196369 accounts receivable includes securities receivable 3000000 fair market value shares date merger consummated june 30 2008 impairment longlived assets effective january 1 2002 company adopted statement financial accounting standards 144 accounting impairment disposal longlived assets sfas 144 addresses financial accounting reporting impairment disposal longlived assets supersedes sfas 121 accounting impairment longlived assets longlived assets disposed accounting reporting provisions apb opinion 30 reporting results operations disposal segment business company periodically evaluates carrying value longlived assets held used accordance sfas 144 sfas 144 requires impairment losses recorded longlived assets used operations indicators impairment present undiscounted cash flows estimated generated assets less assets carrying amounts event loss recognized based amount carrying amount exceeds fair market value longlived assets loss longlived assets disposed determined similar manner except fair market values reduced cost disposal property equipment property equipment stated cost maintenance repair costs charged expense incurred costs major additions betterments capitalized property equipment sold otherwise disposed cost related accumulated depreciation eliminated accounts resulting gain loss reflected income depreciation computed using straightline method estimated useful lives assets ranging three ten years depreciation amortization cost property equipment depreciated estimated useful lives related assets depreciation amortization fixed assets computed straightline basis net earnings per share company adopted provisions statement financial accounting standards 128 earnings per share sfas 128 sfas 128 eliminates presentation primary fully diluted earnings per share eps requires presentation basic diluted eps basic eps computed dividing income loss available common stockholders weightedaverage number common shares outstanding period diluted eps based weightedaverage number shares common stock outstanding period common stock equivalents outstanding end period company following dilutive stock options warrants june 30 2008 2007 providential holdings inc subsidiaries notes consolidated financial statements effective july 1 2006 company adopted sfas 123r accordingly adopted modified prospective application method sfas 123r applied new awards modified repurchased cancelled effective date additionally compensation cost portion awards outstanding date adoption requisite service rendered unvested options recognized period time remaining requisite services rendered fair value financial instruments statement financial accounting standard 107 disclosures fair value financial instruments requires company disclose estimated fair values financial instruments carrying amounts reported statements financial position current assets current liabilities qualifying financial instruments reasonable estimate fair value revenue recognition companys revenue recognition policies compliance staff accounting bulletin sab 104 company recognizes consulting advisory fee revenues transaction completed service fees earned expenses recognized period corresponding liability incurred payments received relevant criteria revenue recognition recorded unearned revenue advertising company expenses advertising costs incurred advertising costs years ended june 30 2008 2007 10759 25682 respectively providential holdings inc subsidiaries notes consolidated financial statements comprehensive income loss statement financial accounting standards 130 reporting comprehensive income sfas 130 establishes standards reporting display comprehensive income components accumulated balances comprehensive income defined include changes equity except resulting investments owners distributions owners among disclosures sfas 130 requires items required recognized current accounting standards components comprehensive income reported financial statement displayed prominence financial statements year ended june 30 2008 2007 company recorded 5768847 unrealized loss 1418377 unrealized gain marketable securities respectively comprehensive income loss presented accompanying consolidated balance sheets amounted 1522997 loss 4245850 gain june 30 2008 2007 respectively income taxes company accounts income taxes accordance sfas 109 accounting income taxes deferred taxes provided liability method whereby deferred tax assets recognized deductible temporary differences deferred tax liabilities recognized taxable temporary differences temporary differences reported amounts assets liabilities tax bases deferred tax assets reduced valuation allowance opinion management likely portion deferred tax assets realized deferred tax assets liabilities adjusted effects changes tax laws rates date enactment reporting segments statement financial accounting standards 131 disclosures segments enterprise related information sfas 131 supersedes statement financial accounting standards 14 financial reporting segments business enterprise establishes standards way public enterprises report information operating segments annual financial statements requires reporting selected information operating segments interim financial statements regarding products services geographic areas major customers sfas 131 defines operating segments components enterprise separate financial information available evaluated regularly chief operating decision maker deciding allocate resources assessing performance company operates one segment years ended june 30 2008 2007 risks uncertainties normal course business company subject certain risks uncertainties company provides service receives marketable securities upon execution transactions consequently value securities received customers affected economic fluctuations customers business growth actual realized value securities could significantly different recorded value reclasifications comparative purposes prior years consolidated financial statements reclassified conform report classifications current year providential holdings inc subsidiaries notes consolidated financial statements recent accounting pronouncements june 2007 fasb issued fasb staff position eitf 073 “accounting nonrefundable advance payments goods services received use future research development activities” “fsp eitf 073” addresses whether nonrefundable advance payments goods services used rendered research development activities expensed advance payment made research development activity performed management currently evaluating effect pronouncement consolidated financial statements december 2007 fasb issued sfas 141 revised 2007 “business combinations” objective statement significantly change accounting business combinations statement 141r acquiring entity required recognize assets acquired liabilities assumed transaction acquisition date fair value limited exceptions statement 141 applies prospectively business combinations acquisition date beginning first annual reporting period beginning december 15 2008 company expect adoption sfas 141r material impact consolidated financial statements december 2007 fasb issued sfas 160 “noncontrolling interests consolidated financial statementsan amendment arb 51 objective statement establish new accounting reporting standards noncontrolling interest subsidiary deconsolidation subsidiary statement 160 effective fiscal years interim periods within fiscal years beginning december 15 2008 company expect adoption sfas 160 material impact consolidated financial statements march 2008 fasb issued statement financial accounting standards “sfas” 161 disclosures derivative instruments hedging activities amendment fasb statement 133 requires additional disclosures objectives derivative instruments hedging activities method accounting instruments sfas 133 related interpretations tabular disclosure effects instruments related hedged items financial position financial performance cash flows company expect adoption sfas 161 material impact consolidated financial statements may 2008 fasb issued sfasb no162 “the hierarchy generally accepted accounting principles” pronouncement mandates gaap hierarchy reside accounting literature opposed audit literature practical impact elevating fasb statements financial accounting concepts gaap hierarchy pronouncement become effective 60 days following sec approval company believe pronouncement impact financial statements may 2008 fasb issued sfasb 163 “accounting financial guarantee insurance contractsan interpretation fasb statement 60” scope statement limited financial guarantee insurance reinsurance contracts pronouncement effective fiscal years beginning december 31 2008 company believe pronouncement impact financial statements note 3 nasd examination discontinuance providential securities inc completion routine audit providential securities inc providential july august 2000 national association securities dealers inc alleged providential violated certain provisions nasds conduct rules 2120 2330 2110 3010 rules 15c24 10b5 10b9 15c33 securities exchange commission providential securities inc henry fahman voluntarily submitted letter acceptance waiver consent awc accepted nasd regulation inc october 27 2000 providential securities inc censured fined 11500000 required offer rescission public customers participated providential private placement addition henry fahman banned capacities associating nasd member providential holdings inc subsidiaries notes consolidated financial statements based upon abovementioned circumstances providential securities inc withdrew membership nasd october 2000 ceased securities brokerage operation fine 115000 included accrued expenses accompanying consolidated financial statements company offered preferred stock holders rescission investment year ended june 30 2004 235000 amount due preferred stock holders plus 105600 related dividends payable totaling 340600 paid either cash issuance common stock balance unredeemed preferred shares related interest included current liabilities accompanying consolidated financial statements note 11 note 4 loans receivable related parties loans receivable related parties consist following june 30 2008 2007 loans biowarm ddc industries unsecured interest free due demand loans jeantex group provimex htv unsecured bear 85 interest per annum due demand 30000 loan pho express bears 325 interest per annum remaining portion interest free due demand loans pho express applied toward payment investment upon closing joint venture agreement year ended june 30 2008 total interest income loans amounting 21782 recorded receiving interests assured note 5 current assets comprise following june 30 2008 2007 note 6 impairment assets year ended june 30 2007 company evaluated investment terra firma gas oil inc cavicophi cement phitex energy group vfmc recognized impairment loss 62500 total investment amount addition considering permanent decline market value marketable securities company wrote marketable securities current market value impairment assets amount 2903543 recognized year ended june 30 2007 providential holdings inc subsidiaries notes consolidated financial statements note 7 marketable equity securities available sale investment marketable securities represents less twenty percent 20 outstanding common stock equivalents investee security nationally quoted national association securities dealers otc bulletin board otcbb pink sheets investment accounted accordance provisions sfas 115 unrealized holding gains losses marketable securities excluded earnings reported separate component stockholders equity realized gains losses securities classified availableforsale reported earnings based upon adjusted cost specific security sold june 30 2008 investments recorded 4435938 based upon quoted market value bulletin board pink sheets june 30 2008 actual realized value securities could significantly different recorded value following summary marketable equity securities classified available sale june 30 2008 june 30 2008 400000 shares jeantex group inc stock 2000000 shares cavico corp stock 3000000 shares ddc industries inc stock pledged collateral shortterm notes payable changes net unrealized holding gainloss securities available sale included separate component stockholders equity year ended june 30 2008 2007 unrealized loss 5768847 unrealized gain 1418377 recorded respectively september 2006 company received 2000000 shares cavico corp valued 1801802 company received shares advisory fees performed may 2006 cost basis shares based market value securities date advisory services completed february 2007 company purchased 369166 shares cavico corp stock 30 per share company sold 1799500 shares cavico shares valued 820706 cost basis fiscal year ended june 30 2007 company recorded impairment expense 2903543 remaining shares marketable securities trading june 30 2007 fiscal year ended june 30 2008 company sold 1174166 shares cavico corp stock received 430031 cash used 300000 shares cavico corp stock settle short term note 100000 values shares recorded gain marketable securities providential holdings inc subsidiaries notes consolidated financial statements march 2007 company received 45000000 shares 900000 postreverse split shares biowarm merged ddc industries valued 675000 company received shares advisory services completed earlier month cost basis shares based market value securities date advisory services completed company recorded marketable securities quoted market value march 31 2007 june 2007 company received 3763753 shares ddc industries fees services performed third fiscal quarter 2007 valued 1881877 fiscal year ended june 30 2008 company received 3763753 ddc industries consulting fee services performed company used 500000 shares securities payment consulting fees contractor year ended june 30 2007 company received 8550000 shares cinnabar enterprises inc services performed completed june 18 2007 recorded 855000 company recorded value shares based upon fair value services provided determinable company recorded value marketable securities quoted market value june 30 2008 actual realized value securities could significantly different recorded value june 22 2007 cinnabar enterprises inc changed name line inc trading symbol “alin” fiscal year ended june 30 2007 company sold 28500 shares jeantex shares fiscal year ended june 30 2008 company sold 2582628 shares eastbridge investment stock 159317 addition company used 125000 shares eastbridge investment stock settle finance charge used 646788 shares payment consulting service amounting 25872 22792 included prepaid expenses company recorded realized gain sale marketable securities 701832 139509 total years ended june 30 2008 2007 respectively note 8 property equipment property equipment june 30 2008 2007 consists following depreciation expense 2634 2448 fiscal years ended june 30 2008 2007 respectively note 9 accounts payable accrued expenses accounts payable accrued expenses june 30 2008 2007 consist following providential holdings inc subsidiaries notes consolidated financial statements year ended june 30 2008 2007 company wrote 66719 544877 respectively old accounts payable statue limitation set state expired amount recorded gain settlement debts consolidated financial statements note 10 due officer due officer represents advances made officers company subsidiaries noninterest bearing except 100000 described unsecured due demand june 30 2008 2007 balances 561982 467932 respectively june 30 2008 company short term note payable amounting 100000 interest bearing 3000 per month payable chief technology officer cto note 11 loans promissory notes promissory notes payable company promissory notes payable international mercantile holding amounting 196111 accrued interest 24201 company pledged 5000000 shares treasury stock lender sold note holders company receive proceeds sale shares agreement entered settlement loan company lender accordingly value shares reflected financial statements stock subscriptions receivable company wrote notes related accrued interest subscription receivable june 30 2007 international mercantile holding longer existence recorded gain settlement debts 20312 short term notes payable june 30 2008 2007 company short term notes payable amounting 1816255 768655 accrued interest 340753 394196 respectively notes bear interest rates ranging 6 36 per annum 773000 short term notes past due 222273 due demand year ended june 30 2008 2007 company paid 174000 295863 principal 1961888 171934 interest short term notes respectively notes payable secured assets company summarized providential holdings inc subsidiaries notes consolidated financial statements due preferred stockholders company classified 215000 preferred stock subscribed current liability payable holders preferred stock due non compliance preferred shares subscription agreement amount past due june 30 2008 company made 5000 interest payment year ended june 30 2007 interest payable holders preferred stock 206855 181055 included accrued interest included account payable accrued expenses balance sheet june 30 2008 2007 respectively current liabilities year ended june 30 2004 company received overpayment 89691 exercise stock options receivable amount paid company june 30 2008 classified payable shown consolidated financial statements current liabilities note 12 litigation legal proceeding settled unpaid june 30 2008 quang van cao nhan thi nguyen cao vs providential securities inc et al case originally submitted orange county superior court ca june 25 1997 case 781121 subsequently moved nasd dispute resolution arbitration august 24 2000 companys legal counsel negotiated claimants counsel unilaterally reached settlement approved company process renegotiating terms said settlement claimants filed request arbitration hearing national association securities dealers october 4 2000 case 99 03160 thereafter claimants filed complaint orange county superior court ca october 31 2000 case 00cc13067 alleged breach contract damages sum 75000 plus prejudgment interest costs incurred connection complaint relief without admitting denying allegations company reached settlement agreement claimants whereby company would pay claimants total 62500 plus 4500 administrative costs date report company paid 2500 subject entry judgment 79000 settlement amount accrued accompanying consolidated financial statements conseco finance vendor services corporation fka green tree vendor services corporation vs providential securities inc henry fahman tina phan september 1997 providential securities inc entered written lease agreement lease certain items equipment green tree vendor services return providential securities inc agreed pay thirtysix monthly installments amount 1552 september 12 2000 subsequently providential securities inc unable make monthly payments claimant due lack revenues following interruption subsequent closure securities brokerage operations see note 3 claimant filed complaint money superior court state california county orange case 01cc02613 february 23 2001 seeking 39102 plus interest thereon legal rate september 12 2000 claimant entered judgment providential securities inc henry fahman tina phan 48933 judgment amount accrued accompanying consolidated financial statements pending litigation ngon vu vs providential securities inc claimant former employee providential securities inc laid 2000 due closure business claimant complained department industrial relations dir allegedly unpaid vacation salaries june 13 2001 dir filed request enter judgment providential securities inc 9074 including wages interest penalty post hearing filing fee sought amount 9074 accrued accompanying consolidated financial statements providential holdings inc subsidiaries notes consolidated financial statements verio vs providential securities inc april 1 2003 verio inc filed judgment providential securities inc whollyowned subsidiary company discontinued october 2000 total 9141 sum consists 6800 services allegedly rendered verio inc providential securities inc 2000 2341 legal costs amounts accrued accompanying consolidated financial statements dow jones company inc vs providential securities inc providential holdings inc march 19 2002 dow jones company filed complaint superior court california county orange west justice center case 02wl1633 providential securities inc discontinued operations company providential holdings inc 9973 plus prejudgment interest rate ten 10 per annum november 1 2000 reasonable attorneys’ fees relief claim connection services allegedly rendered plaintiff providential securities inc prior november 2000 company intends settle case sought amount 9973 excluding interest accrued expenses accompanying consolidated financial statements key equipment finance inc vs 496215601204 providential securities inc henry fahman tina phan case 06wl00289 january 18 2006 key equipment finance filed suit superior court state california county orange west district claiming breach terms lease agreement failure make monthly installment due although demand therefore made remaining balance due owing plaintiff lease 14439 plus interest date default plaintiff also claiming breach guaranty common counts unjust enrichment cost law suit relief court may deem proper june 30 2008 company accrued 14439 nasd case completion routine audit providential securities inc july august 2000 national association securities dealers inc alleged providential violated certain provisions nasds conduct rules result providential securities inc withdrew membership nasd october 2000 ceased securities brokerage operation 127305 including 115000 fine charged nasd included accrued expenses accompanying consolidated financial statements note 3 arbitration cases company four arbitration cases daytraders providential securities inc discontinued stock brokerage operation company total amount damages cases closed june 30 2001 54505 amount accrued accompanying consolidated financial statements note 13 stockholders equity treasury stock year ended june 30 2008 2007 company purchased 120500 1049940 treasury shares 3784 16781 respectively balance june 30 2008 2440440 shares valued 97618 common stock fiscal year ended june 30 2008 year ended june 30 2008 company issued 1800000 shares common stock valued 90000 services year ended june 30 2008 company issued 6000000 shares common stock conversion short term notes amounting 180000 providential holdings inc subsidiaries notes consolidated financial statements year ended june 30 2008 company issued 14000000 shares common stock payment accrued salaries amounting 420000 officers fiscal year ended june 30 2007 year ended june 30 2007 company issued 2500000 shares common stock valued 375000 shares issued year ended june 30 2007 company sold 8291000 shares valued 324750 related parties company balance june 30 2007 172030961 shares valued 6881237 shares issued 06092006 luberski inc transferred subsequently sold 1000000 shares common stock providential holdings belonged officer company given luberski inc collateral loan june 30 2007 company agreed pay back 1000000 shares valued 57000 officer recorded transaction shares issued prepaid consulting year ended june 30 2008 company signed consulting agreement consulting service one year company issued 1500000 shares common stock consultant valued 75000 based upon market value stock date stock issuance company amortized 37500 fiscal year ended june 30 2008 year ended june 30 2005 company signed agreement unrelated thirdparties consulting services two years company issued 1000000 shares common stock consultants valued 44000 based upon market value stock time consummation agreements company amortized 20168 total remaining balance fiscal year ended june 30 2007 year ended june 30 2006 company signed consulting agreement consulting service one year company issued 1000000 shares common stock consultant valued 30000 based upon market value stock date stock issuance company amortized 22500 total remaining balance fiscal year ended june 30 2007 years ended june 30 2008 2007 company amortized 37500 42668 respectively operating expense subscriptions receivable june 30 2008 2007 subscription receivable amounting 25500 consultant shares issued year ended 2005 still received note 14 stock based compensation plan stock options july 10 2000 company adopted stock option incentive plan provides issuance maximum 16 million shares companys common stock officers employees nonemployee directors sole discretion board directors august 10 2000 company granted fourteen million options plan officers directors employees exercise price 50 per share date report options exercised seven million options forfeited remaining seven million options exercisable july 1 2001 expired december 31 2005 company grant options fiscal years ended june 30 2008 2007 common stock purchase options expired june 30 2008 february 7 2005 company adopted stockbased compensation plan set aside 14000000 shares common stock selected eligible participants company subsidiaries certain independent contractors providing certain services company june 30 2008 12478512 shares issued salaries consulting professional services lieu cash plan prior july 1 2006 company measured stock compensation expense using intrinsic value method accounting accordance accounting principles board apb opinion 25 accounting stock issued employees related interpretations apb 25 company adopted sfas 123r effective july 1 2006 using modified prospective method warrants year ended june 30 2008 company issued 250000 stock warrants term 5 years three year vesting period following assumptions used blackscholes pricing model following summary warrant activity year ended june 30 2008 providential holdings inc subsidiaries notes consolidated financial statements note 15 gain settlement debt year ended june 30 2008 2007 company recorded gain 67719 630749 settlement debt respectively note 9 11 note 16 related party transactions year ended june 30 2008 company issued shares officerdirectors two years’ accrued salaries follows year ended june 30 2007 company issue shares directors services company accrued 210000 salaries henry fahman tina phan years ended june 30 2008 2007 year ended june 30 2007 company 2556877 revenue represents 72 total revenue company common officer note 17 income taxes provision made income tax since company significant net operating loss carry forward june 2008 company incurred net operating losses tax purposes approximately 165 million net operating loss forward may used reduce taxable income year 2028 net operating loss carry forwards state california generally available reduce taxable income year 2018 availability companys operating loss carryforward subject limitation 50 positive change ownership companys stock net deferred tax asset balance due net operating loss carryforwards june 30 2008 2007 approximately 34 million 43 million respectively 100 valuation allowance established deferred assets utilization loss carryforwards cannot reasonably assured components net deferred tax asset summarized providential holdings inc subsidiaries notes consolidated financial statements following reconciliation provision income taxes us federal income tax rate income taxes reflected consolidated statements operations note 18 contracts commitments providential oil gas inc agreement terrafirma gas oil inc november 24 2005 company’s whollyowned subsidiary providential oil gas inc signed agreement terrafirma gas oil inc nevada corporation headquarters midland texas codevelop twentyfour gas wells hudspeth ranch crockett county west texas providential oil gas inc responsible providing capital funding drilling gas wells terrafirma responsible managing project according agreement providential oil gas receive seventyfive percent share net working interest first two wells 1063800 capital funding repaid principal fully repaid providential oil gas receive fifty percent share net working interest life two wells subsequent well packages terrafirma gas oil inc providential oil gas inc determine agree upon mutually acceptable arrangement sharing responsibilities net working interest new wells 20000 investment company project written fiscal year ended june 30 2007 june 14 2006 providential oil gas inc changed name providential energy corporation expand scope business potentially include alternative energy fuel cells biodiesel agreement hawk associates inc august 11 2006 company entered investor relations consulting agreement hawk associates inc florida corporation effective september 1 2006 according agreement hawk associates provide investor relations consulting services company period six months agreement automatically renew monthly notice provided one parties company agrees pay hawk associates 4500 per month investor relations consulting services hawk associates issued warrants purchase 250000 common shares company based closing price 0015 per share september 1 2006 warrants valid august 30 2011 june 30 2007 company issued 250000 warrants recorded expense agreement biowarm corporation september 25 2006 company entered agreement biowarm corporation “biowarm” nevada corporation whereby company agreed provide management consulting services biowarm year ended june 30 2007 company received compensation biowarm agreement note 7 providential holdings inc subsidiaries notes consolidated financial statements agreement dai dung metallic manufacture construction trade co november 30 2006 company entered business financial consulting agreement dai dung metallic manufacture construction trade co ltd company duly organized existing laws socialist republic vietnam principal offices b23474c tran dai nghia st tan nhat village binh chanh district ho chi minh city vietnam provide consulting services identification location facilitating merger publiclytraded company us merger successful company receive common stock newly combined company equal 20 issued outstanding common shares new company merger dai dung biowarm corp consummated march 30 2007 company recorded 1881877 part marketable securities based fair market value shares date merger business financial consutling agreement saigon plastic packaging co ltd february 11 2007 company entered business consulting agreement saigon plastic packaging co ltd “saplastic” vietnamese company located ho chi minh city vietnam provide services identification location facilitating merger publiclytraded company us arrange 5 million 10 million postmerger company growth merger successful company receive 20 issued outstanding common shares new combined company payment services date report successful merger completed agreement pacific associates investment group april 25 2007 providential capital subsidiary company entered agreement pacific associates investment group “paig” consulting services duration 12 months company pay paig 30 commission fees collected upon contract agreement signed providential capital seller activity date report business financial consulting agreement blueocean investment llc june 12 2007 company entered business consulting agreement blueocean investment llc company duly organized existing laws california located los angeles provide consulting service identifying locating acquiring various business opportunities including reverse merger publiclytraded company us consideration services provided blueocean paid 260000 cash deposited law office refundable company fails complete trasaction contemplated 90 days agreement date addition upon blueocean’s becoming public initial public offering closing date proposed merger publicly traded company blueocean issue 15 newly combined company’s issued outstanding shares common stock reverse merger blueocean publicly traded company consummated june 18 2007 joint ventrue agreement bmfs inc june 13 2007 company entered joint venture agreement bmfs inc assist reverse merger transaction blueocean investment llc based agreement 50 total cash payment blueocean inc minus purchase price public shell 60000 30000 60 compensated stocks 14250000 8550000 shares allocated company recorded receipt cash stocks consulting income year ended june 30 2007 business financial consutling agreement catthai plastic company june 25 2007 company entered business consulting agreement catthai plastic company “cathaco ltd” vietnamese company located ho chi minh city vietnam services include 1 taking cathaco public us via reverse merger business combination ipo 2 arranging intermediate funding become fullyreporting publicly traded company otcbb hicher exchange us 3 subsequent listings new company’s shares berlin frankfurt stock exchanges necessary 4further longterm funding capital requirements needed company recorded 3000000 part accounts receivable based fair market value shares date merger consummated june 30 2008 consulting agreement affiliated business services inc july 10 2007 company entered consulting agreement affiliated business services inc services concerning management marketing consulting strategic planning corporate organization structure financial matters one year term continues month basis terminated either party 30 days notice company pay 110 cash funds raised consultant behalf company 2a fee form cashless exercise warrants amount term negotiated agreed company investor funds raised consultant 3 fee 50000 10 whichever greater purchase price acquisition merger made involving company introduced consultant 4 fee 10 total value contracts brought company activity date report joint venture agreement wrc partners september 5 2007 providential energy corp subsidiary company entered agreement wrc partners formed joint venture intersource consulting group inc wrcp pec cooperate funding building owning operating certain business us regions world share benefits business operations activity date report business cooperation agreement pho express september 19 2007 provimex inc subsidiary company entered business cooperation agreement owner pho express establish new vietnamese style noodle soup restaurant pho express international llc pho express agreed contribute assets liabilities exchange 40 equity ownership provimex agreed pay 165000 exchange 60 equity ownership pho express international llc company paid 71500 toward investment loaned 13500 pho express june 30 2008 business financial consulting agreement mast ventures llc effective april 1 2008 company entered business financial consulting agreement mast ventures llc raise capital wholly owned subsidiary philand corporation 5 years service includes assistance identifying potential investors developing approach seeking current financing investor relations company agreed pay 5 total funds raised consultant agreement iberville exploration llc april 7 2008 providential energy corporation wholly owned subsidiary company entered agreement iberville exploration llciberville purchase interest bayyou choctaw project assets company agreed provide 100 funds required iberville purchase acquired interests within 5 days notification scheduling closing date transaction cooperation agreement phu yen minerals joint stock company april 14 2008 indochina mining corporation imc wholly owned subsidiary company entered cooperation agreement phu yen minerals joint stock company pymico agreement pymico imc cooperate contribute capital establishment joint venture specializing exploitation processing diatomite phu yen providence imc participate pymico purchasing maximum 30 shares pymico latter issues additional shares 2008 providential holdings inc subsidiaries notes consolidated financial statements office space lease company started office lease august 2004 3907 per month three years terminated july 2007and company paid rent monthto month basis april 30 2008 company signed 5 year lease agreement office effective may 1 2008 monthly rental 669070 increased 35 per annum commencing thirteenth month initial lease term continuing annually thereafter future commitments operating leases follows twelve months ending june 30 rent expense 81130 51005 year ended june 30 2008 2007 respectively note 19 going concern uncertainty shown accompanying consolidated financial statements company accumulated deficit 14990621 negative cash flow operations amounting 1782930 year ended june 30 2008 factors well uncertain conditions company faces daytoday operations respect cash flows create uncertainty companys ability continue going concern financial statements include adjustments might necessary company unable continue going concern management taken action strengthen companys working capital position generate sufficient cash meet operating needs june 30 2009 beyond company also anticipates generating revenue proposed mergers acquisitions assurances made management successful achieving plan president chairman company committed funding companys operations next 12 months note 20 subsequent events september 19 2008 note holder former director agreed waive accrued interest totaling 118258 notes 120000 50000 company agreed pay 3000 per month 120000 note 2000 per month 50000 note entire principal amounts paid full first payment payable october 15 2008 september 29 2008 note agreement 115000 accrued interest 63550 amended pay lender total 165000 divided 15 monthly payments minimum 11000 per month entire amount paid full first payment payable october 15 2008 company agreed deliver 500000 shares common stock catthai corporation additional collateral september 30 2008 philand corporation whollyowned subsidiary company issued 20203591 shares company 3500000 shares employees consultants restructuring traded germany item 9 item 8 changes disagreements accountants accounting financial disclosure none part iii item 9 item 8 financial statements report independent registered public accounting firm board directors stockholders phi group inc formerly providential holdings inc audited accompanying consolidated balance sheets phi group inc nevada corporation subsidiaries june 30 2010 2009 related consolidated statements operations stockholders equity cash flows years ended june 30 2010 2009 consolidated financial statements responsibility companys management responsibility express opinion consolidated financial statements based audits conducted audit statements accordance standards public company accounting oversight board united states standards require plan perform audit obtain reasonable assurance whether financial statements free material misstatement audit includes examining test basis evidence supporting amounts disclosures financial statements audit also includes assessing accounting principles used significant estimates made management well evaluating overall financial statement presentation believe audits provide reasonable basis opinion consolidated financial statements referred present fairly material respects consolidated financial position phi group inc subsidiaries june 30 2010 june 30 2009 results consolidated operations cash flows years ended june 30 2010 2009 conformity accounting principles generally accepted united states america companys financial statements prepared using generally accepted accounting principles applicable going concern contemplates realization assets liquidation liabilities normal course business company accumulated deficit 26963783 net loss amounting 3651120 year ended june 30 2010 addition company development project expire renewed requisite authorities factors discussed note 20 consolidated financial statements raise substantial doubt companys ability continue going concern managements plans regard matters also described note 20 consolidated financial statements include adjustments might result outcome uncertainties kabani company inc certified public accountants los angeles california september 30 2010 phi group inc subsidiaries formerly providential holdings inc notes consolidated financial statements note 1 nature business phi group inc phi engaged number business activities important merger acquisition advisory services company acquires consolidates special opportunities selective industries create additional value acts incubator emerging companies technologies provides financial consultancy advisory services us foreign companies wholly owned division company provimex formed april 10 2001 name providential imex focus trade commerce vietnam subsidiary later incorporated nevada corporation september 23 2004 may 2003 company formed subsidiary name providential capital provide financial products services microsmall cap arenas manage companys proprietary merger acquisition activities july 7 2003 whollyowned dba providential holdings inc touchlink communications formed provide pointofsale pos terminals prepaid calling cards retailers convenient stores nonprofit organizations across us company later incorporated nevada corporation february 2004 name touchlink communications inc provide long distance services residential business customers united states november 1 2003 company formed phi video corp later renamed phi digital corp phi digital nevada corporation phi digital renamed tulon industries inc change scope business subsidiary generate revenue fiscal years ended june 2010 2009 december 31 2003 company formed providential oil gas inc nevada corporation whollyowned subsidiary pursue independent oil gas business june 14 2006 providential oil gas inc changed name providential energy corporation expand scope business potentially include alternative energy fuel cells biodiesel entity operations year ended june 30 2010 2009 july 2007 philand corporation nevada corporation wholly owned subsidiary company formed manage real estate development project south hoi quang nam province vietnam july 2007 providential holdings entered principle agreement people’s committee quang nam province allows company lease approximately 8000 acres land south hoi quang nam province vietnam develop integrated tourism zone 70year lease term philand corporation currently involved planning developing project year ended june 30 2009 3500000 shares philand corporation issued employees consultants company 244286 shares owned company sold individuals 140000 29000 shares exchanged payment note amounting 29000 900000 shares owned company exchanged 23285714 shares jeantex group inc addition year ended june 30 2009 408000 shares philand corporation sold 49000 total 5081286 shares held minority shareholders makes approximately 21 outstanding shares june 5 2009 philand ranch limited company registered laws england wales acquired issued outstanding common stock philand corporation exchange amount ordinary shares philand ranch limited result stock exchange philand corporation philand ranch limited june 2009 company received 18734753 shares ordinary stock philand ranch limited march 2007 company received 900000 shares valued 675000 biowarm subsequently acquired 100 vietnambased dai dung metallic manufacture construction trade company ddmmct changed name ddc industries inc company received shares advisory services completed earlier month june 2007 company received 3763753 shares ddc industries services performed merger biowarm corp ddmmct closed march 30 2007 received remaining 3763753 shares year ended june 30 2008 per agreement total equivalent 20 issued outstanding shares ddc industries inc merger agreement ddmmct rescinded november 18 2008 entirety shareholders ddmmct agreed return 28610025 shares 30110025 issued shares december 1 2008 ddc industries inc changed name phi mining group inc common stock phi mining group inc currently trading pink sheets symbol “phig” phi mining group generate revenues year ended june 30 2010 indochina mining corporation nevada corporation incorporated march 20 2008 exploitation processing diatomite mines april 14 2008 indochina mining corporation imc entered cooperation agreement phu yen minerals joint stock company pymico agreement pymico imc cooperate contribute capital establishment joint venture specializing exploitation processing diatomite phu yen providence imc participate pymico purchasing maximum 30 shares pymico latter issues additional shares 2008 indochina mining also entered agreements todate venture begun operation december 1 2008 indochina mining corporation entered stock purchase agreement phi mining group formerly ddc industries inc exchange capital stock number newly issued shares phi mining group result company owns approximately 83 phi mining group may 20 2008 providential vietnam ltd vietnamese limited liability company whollyowned subsidiary company formed provide advisory services management consulting services note 2 summary significant accounting policies principles consolidation consolidated financial statements include accounts phi group inc subsidiaries providential securities inc providential capital phi digital inc “phi digital” provimex providential energy corporation touchlink communications phi mining group providential vietnam philand ranch 100 owned subsidiary philand corporation ltd collectively referred company significant intercompany transactions eliminated consolidation providential securities inc phi digital provimex providential energy corporation touchlink communications inactive use estimates preparation consolidated financial statements conformity accounting principles generally accepted united states america requires management make estimates assumptions affect reported amounts assets liabilities disclosure contingent assets liabilities date financial statements reported amounts revenues expenses reporting period actual results could differ estimates cash equivalents company considers liquid investments maturity three months less date purchase readily convertible cash equivalents marketable securities companys securities classified availableforsale carried fair value securities classified availableforsale may sold response changes interest rates liquidity needs purposes investment marketable securities represents less twenty percent 20 outstanding common stock equivalents investee security nationally quoted national association securities dealers otc bulletin board otcbb pink sheets investment accounted accordance provisions asc 320 previously sfas 115 unrealized holding gains losses availableforsale securities excluded earnings reported separate component stockholders equity realized gains losses securities classified availableforsale reported earnings based upon adjusted cost specific security sold june 30 2010 2009 marketable securities recorded 000 1750000 respectively based upon fair value marketable securities accounts receivable company maintains reserves potential credit losses accounts receivable management reviews composition accounts receivable analyzes historical bad debts customer concentrations customer credit worthiness current economic trends changes customer payment patterns evaluate adequacy reserves recorded primarily specific identification basis june 30 2010 2009 company balances 0 67500 accounts receivable impairment longlived assets effective january 1 2002 company adopted asc 350 previously sfas 144 accounting impairment disposal longlived assets addresses financial accounting reporting impairment disposal longlived assets supersedes sfas 121 accounting impairment longlived assets longlived assets disposed accounting reporting provisions apb opinion 30 reporting results operations disposal segment business company periodically evaluates carrying value longlived assets held used accordance asc 350 asc 350 requires impairment losses recorded longlived assets used operations indicators impairment present undiscounted cash flows estimated generated assets less assets carrying amounts event loss recognized based amount carrying amount exceeds fair market value longlived assets loss longlived assets disposed determined similar manner except fair market values reduced cost disposal property equipment property equipment stated cost maintenance repair costs charged expense incurred costs major additions betterments capitalized property equipment sold otherwise disposed cost related accumulated depreciation eliminated accounts resulting gain loss reflected income depreciation computed using straightline method estimated useful lives assets ranging three ten years depreciation amortization cost property equipment depreciated estimated useful lives related assets depreciation amortization fixed assets computed straightline basis net earnings per share company adopted provisions asc 260 previously sfas 128 asc 260 eliminates presentation primary fully diluted earnings per share eps requires presentation basic diluted eps basic eps computed dividing income loss available common stockholders weightedaverage number common shares outstanding period diluted eps based weightedaverage number shares common stock outstanding period common stock equivalents outstanding end period company following dilutive stock warrants june 30 2010 2009 warrants 250000 total 250000 net earnings per share computed follows basic diluted net loss per share numerator net incomeloss 3651120 8322040 denominator basic weighted average number common shares outstanding 196619950 191261503 basic net income loss per share 002 004 diluted weighted average number common shares outstanding 196619950 191261503 diluted net income loss per share 002 004 stockbased compensation effective july 1 2006 company adopted asc 7181025 previously sfas 123r accordingly adopted modified prospective application method asc 7181025 applied new awards modified repurchased cancelled effective date additionally compensation cost portion awards outstanding date adoption requisite service rendered unvested options recognized period time remaining requisite services rendered fair value financial instruments effective july 1 2008 company adopted asc 820 previously sfas 157 fair value measurements adopted statement assets liabilities shown table asc 820 clarifies definition fair value prescribes methods measuring fair value establishes fair value hierarchy based inputs used measure fair value expands disclosures use fair value measurements adoption asc 820 material impact fair value measurements asc 820 permits company defer recognition measurement nonfinancial assets nonfinancial liabilities january 1 2009 june 30 2010 company nonfinancial assets nonfinancial liabilities recognized disclosed fair value asc 820 requires financial assets liabilities reported fair value categorized one following types investments based upon methodology determining fair value level 1 quoted prices active markets identical assets liabilities level 2 observable inputs level 1 prices quoted prices similar assets liabilities quoted prices markets active inputs observable corroborated observable market data substantially full term assets liabilities level 3 unobservable inputs supported little market activity significant fair value assets liabilities company utilizes various approaches measure fair value availableforsale securities assets measured fair value recurring basis summarized company financial liabilities measured fair value recurring basis availableforsale securities level 1 level 2 level 3 total june 30 2010 000 june 30 2009 1750000 use various approaches measure fair value availableforsale securities applying threelevel valuation hierarchy disclosures specified asc 820 level 1 securities measured using quoted prices active markets identical assets liabilities received 3500000 shares client company vietnam united steel corporation consulting services provided year ended june 30 2009 shares constituted 20 ownership client company valued 1750000 considered management level 3 valuation hierarchy due share’s little market activity valued shares received using undiscounted cash flow method based audited financial statements year ended december 31 2007 merger candidate client company calculated projected cash flow three consecutive fiscal periods conservative increase 20 per year addition cash flow projection also discounted quoted market price 50 market price time completion services provided management believed time completion transaction fair value approximately 050share time however june 30 2010 permanently impaired 1750000 3500000 shares vietnam united steel corporation due company’s lack financial disclosure trading activity company’s policy regarding transfers andor level 3 depends trading activity security volatility security observable units clearly represents fair value security level 3 security measured using fairly represented fair value transfer security either level 1 level 2 depending type inputs revenue recognition companys revenue recognition policies compliance asc 13 previously staff accounting bulletin sab 104 company recognizes consulting advisory fee revenues transaction completed service fees earned expenses recognized period corresponding liability incurred payments received relevant criteria revenue recognition recorded unearned revenue advertising company expenses advertising costs incurred advertising costs years ended june 30 2010 2009 1910 12650 respectively comprehensive income loss asc 2201045 previously sfas 130 reporting comprehensive income establishes standards reporting display comprehensive income components accumulated balances comprehensive income defined include changes equity except resulting investments owners distributions owners among disclosures sfas 130 requires items required recognized current accounting standards components comprehensive income reported financial statement displayed prominence financial statements year ended june 30 2010 2009 company recorded 000 2110305 unrealized loss marketable securities respectively comprehensive loss presented accompanying consolidated balance sheets amounted 0 june 30 2010 2009 respectively income taxes company accounts income taxes accordance asc 740 previously sfas 109 accounting income taxes deferred taxes provided liability method whereby deferred tax assets recognized deductible temporary differences deferred tax liabilities recognized taxable temporary differences temporary differences reported amounts assets liabilities tax bases deferred tax assets reduced valuation allowance opinion management likely portion deferred tax assets realized deferred tax assets liabilities adjusted effects changes tax laws rates date enactment reporting segments asc 280 previously statement financial accounting standards 131 disclosures segments enterprise related information supersedes statement financial accounting standards 14 financial reporting segments business enterprise establishes standards way public enterprises report information operating segments annual financial statements requires reporting selected information operating segments interim financial statements regarding products services geographic areas major customers asc 280 defines operating segments components enterprise separate financial information available evaluated regularly chief operating decision maker deciding allocate resources assessing performance company operates one segment years ended june 30 2010 2009 risks uncertainties normal course business company subject certain risks uncertainties company provides service receives marketable securities upon execution transactions consequently value securities received customers affected economic fluctuations customers business growth actual realized value securities could significantly different recorded value recent accounting pronouncements june 2009 fasb issued asc 810 previously sfas 167 amendments fasb interpretation 46r amendments include 1 elimination exemption qualifying special purpose entities 2 new approach determining consolidate variableinterest entity 3 changes necessary reassess consolidate variableinterest entity sfas 167 effective first annual reporting period beginning november 15 2009 interim periods within first annual reporting period company adopt sfas 167 fiscal 2010 evaluating impact consolidated results company june 2009 financial accounting standards board “fasb” issued statement financial accounting standards “sfas” 168 “the fasb accounting standards codification hierarchy generally accepted accounting principles” “sfas 168” sfas 168 establishes fasb accounting standards codification “codification” single source authoritative nongovernmental us gaap codification effective interim annual periods ending september 15 2009 adoption standard material impact financial statements note 3 nasd examination discontinuance providential securities inc completion routine audit providential securities inc providential july august 2000 national association securities dealers inc alleged providential violated certain provisions nasds conduct rules 2120 2330 2110 3010 rules 15c24 10b5 10b9 15c33 securities exchange commission providential securities inc henry fahman voluntarily submitted letter acceptance waiver consent awc accepted nasd regulation inc october 27 2000 providential securities inc censured fined 11500000 required offer rescission public customers participated providential private placement addition henry fahman banned capacities associating nasd member based upon abovementioned circumstances providential securities inc withdrew membership nasd october 2000 ceased securities brokerage operation fine 115000 included accrued expenses accompanying consolidated financial statements company offered preferred stock holders rescission investment year ended june 30 2004 235000 amount due preferred stock holders plus 105600 related dividends payable totaling 340600 paid either cash issuance common stock balance unredeemed preferred shares related interest included current liabilities accompanying consolidated financial statements note 12 note 4 loans receivable related parties loans receivable related parties consist following june 30 2010 2009 loan catalyst resource group inc 1000 loan cavico corporation 1020 loan catthai corp loan pho express 109600 2120 111620 loan pho express written fiscal year ended june 30 2010 note 5 current assets comprise following june 30 2010 2009 advance shares purchase 780 77903 loans receivable unsecured noninterest bearing unsecured 65000 prepaid expense others total 780 142903 fiscal year ended june 30 2010 company wrote 71000 shares received 65000 loan receivable note 6 marketable equity securities available sale company’s marketable securities classified availableforsale carried fair value securities comprised shares common stock investee securities classified availableforsale may sold response changes interest rates liquidity needs purposes investment marketable securities represents less twenty percent 20 outstanding common stock equivalents investee security nationally quoted national association securities dealers otc bulletin board otcbb pink sheets investment accounted accordance provisions sfas 115 june 30 2010 permanently impaired 1750000 3500000 shares vietnam united steel corporation earned consulting services year ended june 30 2009 due company’s lack financial disclosure trading activity note 7 property equipment property equipment june 30 2010 2009 consists following equipment 89691 87957 furniture fixtures 59115 automobiles 58000 93191 subtotal 206806 240263 less accumulated depreciation 202290 193322 total net fixed assets 4516 46941 depreciation expenses 19233 15843 fiscal years ended june 30 2010 2009 respectively note 8 construction progress construction progress represents costs incurred philand corporation subsidiary company real estate development amounting 935076 june 30 2010 costs included interest capitalized 252055 note 9 accounts payable accrued expenses accounts payable accrued expenses june 30 2010 2009 consist following accounts payable accrued expenses 1462010 1167455 accrued salaries payroll taxes 292519 300 199 accrued interest 1267207 833607 accrued legal 385084 accrued consulting fees 177981 3584801 2864325 note 10 due officer due officer represents advances made officers company subsidiaries noninterest bearing except 100000 described unsecured due demand june 30 2010 2009 balances 1126529 1013561 respectively june 30 2010 company short term note payable amounting 100000 interest bearing 3000 per month payable former chief technology officer cto note 11 loans promissory notes short term notes payable june 30 2010 2009 company short term notes payable amounting 2400546 2310085 accrued interest 1367980 833607 respectively notes bear interest rates ranging 6 36 per annum 1811500 short term notes past due 315535 due demand year ended june 30 2010 2009 company paid 130865 167485 principal 68395 200135 interest shortterm notes respectively notes payable secured assets company summarized note balance secured 115000 400000 catalyst resource group shares 500000 catthai corp shares 550000 35000 cavico corp shares 500000 catthai corp shares 150000 1500000 phi mining group shares 100000 1500000 phi mining group shares due preferred stockholders company classified 215000 preferred stock previously subscribed one company’s subsidiaries current liability payable subsidiary’s holders preferred stock due non compliance preferred shares subscription agreement amount past due june 30 2010 interest payable holders preferred stock 258455 232655 included accrued interest included account payable accrued expenses balance sheet june 30 2010 2009 respectively unearned revenue unearned revenue 459886 consulting fee service performed company completed june 30 2010 company going provide clients going public us stock markets arrange funding going public current liabilities year ended june 30 2004 company received overpayment 89691 exercise stock options receivable amount paid company june 30 2010 classified payable shown consolidated financial statements current liabilities company received 30000 refundable deposit connection consulting agreement company client note 12 litigation legal proceeding settled unpaid june 30 2010 quang van cao nhan thi nguyen cao vs providential securities inc et al case originally submitted orange county superior court ca june 25 1997 case 781121 subsequently moved nasd dispute resolution arbitration august 24 2000 companys legal counsel negotiated claimants counsel unilaterally reached settlement approved company process renegotiating terms said settlement claimants filed request arbitration hearing national association securities dealers october 4 2000 case 9903160 thereafter claimants filed complaint orange county superior court ca october 31 2000 case 00cc13067 alleged breach contract damages sum 75000 plus prejudgment interest costs incurred connection complaint relief without admitting denying allegations company reached settlement agreement claimants whereby company would pay claimants total 62500 plus 4500 administrative costs date report company paid 2500 subject entry judgment 79000 settlement amount accrued accompanying consolidated financial statements conseco finance vendor services corporation fka green tree vendor services corporation vs providential securities inc henry fahman tina phan september 1997 providential securities inc entered written lease agreement lease certain items equipment green tree vendor services return providential securities inc agreed pay thirtysix monthly installments amount 1552 september 12 2000 subsequently providential securities inc unable make monthly payments claimant due lack revenues following interruption subsequent closure securities brokerage operations see note 3 claimant filed complaint money superior court state california county orange case 01cc02613 february 23 2001 seeking 39102 plus interest thereon legal rate september 12 2000 claimant entered judgment providential securities inc henry fahman tina phan 48933 judgment amount accrued accompanying consolidated financial statements pending litigation ngon vu vs providential securities inc claimant former employee providential securities inc laid 2000 due closure business claimant complained department industrial relations dir allegedly unpaid vacation salaries june 13 2001 dir filed request enter judgment providential securities inc 9074 including wages interest penalty post hearing filing fee sought amount 9074 accrued accompanying consolidated financial statements verio vs providential securities inc april 1 2003 verio inc filed judgment providential securities inc whollyowned subsidiary company discontinued october 2000 total 9141 sum consists 6800 services allegedly rendered verio inc providential securities inc 2000 2341 legal costs amounts accrued accompanying consolidated financial statements dow jones company inc vs providential securities inc phi group inc march 19 2002 dow jones company filed complaint superior court california county orange west justice center case 02wl1633 providential securities inc discontinued operations company phi group inc 9973 plus prejudgment interest rate ten 10 per annum november 1 2000 reasonable attorneys’ fees relief claim connection services allegedly rendered plaintiff providential securities inc prior november 2000 company intends settle case sought amount 9973 excluding interest accrued expenses accompanying consolidated financial statements key equipment finance inc vs 496215601204 providential securities inc henry fahman tina phan case 06wl00289 january 18 2006 key equipment finance filed suit superior court state california county orange west district claiming breach terms lease agreement failure make monthly installment due although demand therefore made remaining balance due owing plaintiff lease 14439 plus interest date default plaintiff also claiming breach guaranty common counts unjust enrichment cost law suit relief court may deem proper june 30 2010 company accrued 14439 davidson vs doan et al february 01 2010 company notified suit filed superior court state california county los angeles november 24 2009 william davidson individual martin doan henry fahman hrciti corporation providential capital inc collectively referred “defendants” case bc 426831 plaintiff demanded amount less 14000000 defendants promissory notes outstanding plaintiff company accrued potential liabilities associated promissory notes accompanying consolidated financial statements june 30 2010 nasd case completion routine audit providential securities inc july august 2000 national association securities dealers inc alleged providential violated certain provisions nasds conduct rules result providential securities inc withdrew membership nasd october 2000 ceased securities brokerage operation 127305 including 115000 fine charged nasd included accrued expenses accompanying consolidated financial statements note 3 arbitration cases company four arbitration cases daytraders providential securities inc discontinued stock brokerage operation company total amount damages cases closed june 30 2001 54505 amount accrued accompanying consolidated financial statements note 13 basic diluted net loss per share net loss per share calculated accordance sfas 128 earnings per share provision sfas 128 basic net loss per share computed dividing net loss period weightedaverage number common shares outstanding period diluted eps based weightedaverage number shares common stock outstanding period common stock equivalents outstanding end period basic diluted weighted average number shares year ended june 30 2010 since inclusion common stock equivalents antidilutive note 14 stockholders equity effective april 13 2009 company amended articles incorporation change par values preferred common stock 0001 company 400000000 authorized capital stock consisting 300000000 shares common stock 100000000 shares preferred stock effect change reflected retroactively consolidated financial statements treasury stock years ended june 30 2010 2009 company purchased 0 170000 treasury shares 0 4233 respectively balance treasury stock 1330440 shares june 30 2010 amounting 1331 common stock fiscal year ended june 30 2010 year ended june 30 2010 company issued 3150000 shares common stock valued 157500 payment accrued payroll consulting fees fiscal year ended june 30 2009 year ended june 30 2009 company issued 1300000 shares common stock valued 32500 payment accrued payroll consulting fees shares issued 06092006 luberski inc transferred subsequently sold 1000000 shares common stock phi group inc belonged officer company given luberski inc collateral loan june 30 2007 company agreed pay back 1000000 shares valued 57000 officer recorded transaction shares issued prepaid consulting year ended june 30 2010 company signed consulting agreement consulting service one year company issued 200000 shares common stock consultant valued 10000 based upon market value stock date stock issuance company amortized 5000 year ended june 30 2010 note 15 stock based compensation plan stockbased compensation february 7 2005 company adopted stockbased compensation plan set aside 14000000 shares common stock selected eligible participants company subsidiaries certain independent contractors providing certain services company prior july 1 2006 company measured stock compensation expense using intrinsic value method accounting accordance accounting principles board apb opinion 25 accounting stock issued employees related interpretations apb 25 company adopted sfas 123r effective july 1 2006 using modified prospective method warrants quarter ended september 30 2006 company issued 250000 stock warrants term 5 years three year vesting period following assumptions used blackscholes pricing model riskfree interest rate 464 expected life 500 years expected volatility 198 expected dividend yield 0 following summary warrant activity year ended june 30 2010 warrants outstanding exercise price aggregate intrinsic value outstanding june 30 2009 250000 0015 3000 granted forfeited exercised outstanding june 30 2010 250000 0015 3000 following summary status warrants outstanding june 30 2010 exercise price total warrants outstanding remaining life years total exercise price warrants exercisable exercise price 0015 250000 142 0015 250000 0015 note 16 gain settlement debt year ended june 30 2010 2009 company recorded loss 2701 gain 187794 settlement debt respectively note 17 related party transactions company accrued 210000 salaries henry fahman president company tina phan secretary company years ended june 30 2010 2009 revenues company generated phi group parent company provides consulting services clients revenues considered earned services deemed complete company receives consideration consulting services provided either cash andor common stock client company revenues earned company’s subsidiaries periods income statements presented period ended june 30 2010 company earned following revenues period ended june 30 2009 company earned following revenues note 18 income taxes provision made income tax since company significant net operating loss carry forward june 30 2010 company incurred net operating losses tax purposes approximately 82 million net operating loss carry forward may used reduce taxable income year 2029 net operating loss carry forwards state california generally available reduce taxable income year 2029 availability companys net operating loss carryforward subject limitation 50 positive change ownership companys stock net deferred tax asset balance due net operating loss carryforwards june 30 2010 2009 approximately 82 million 67 million respectively 100 valuation allowance established deferred tax assets utilization loss carryforwards cannot reasonably assured components net deferred tax asset summarized value 1000000 june 30 2010 june 30 2009 deferred tax asset 82 67 valuation allowance 82 67 following reconciliation provision income taxes us federal income tax rate income taxes reflected consolidated statements operations june 30 june 30 2010 2009 tax expense credit statutory ratefederal 34 state tax expense net federal tax 6 changes valuation allowance 40 tax expense actual rate note 19 contracts commitments agreement hawk associates inc august 11 2006 company entered investor relations consulting agreement hawk associates inc florida corporation effective september 1 2006 according agreement hawk associates provide investor relations consulting services company period six months agreement automatically renew monthly notice provided one parties company agrees pay hawk associates 4500 per month investor relations consulting services hawk associates issued warrants purchase 250000 common shares company based closing price 0015 per share september 1 2006 warrants valid august 30 2011 business cooperation agreement pho express september 19 2007 provimex inc subsidiary company entered business cooperation agreement owner pho express establish new vietnamese style noodle soup restaurant pho express international llc pho express agreed contribute assets liabilities exchange 40 equity ownership provimex agreed pay 165000 exchange 60 equity ownership pho express international llc june 30 2010 business cooperation agreement could closed company wrote 109600 previously deposited pho express business financial consulting agreement mast ventures llc effective april 1 2008 company entered business financial consulting agreement mast ventures llc raise capital wholly owned subsidiary philand corporation 5 years service includes assistance identifying potential investors developing approach seeking current financing investor relations company agreed pay 5 total funds raised consultant business financial consulting agreement linh thanh group effective april 26 2010 company signed agreement linh thanh group joint stock company vietnambased company take majorityowned subsidiary linh thanh group linh thanh quang binh exploiting processing high calcium carbonate powder joint stock company “ltqb” public us via reverse merge stock swap business combination us publicly traded company exchange services rendered company would receive compensation cash linh thanh group common stock combined company stock swap agreement ltqb us public company closed june 28 2010 however combined company reported updated financial information appropriate regulatory agencies date report company recognize revenues transaction june 30 2010 business financial consulting agreement thinh hung investment co effective may 21 2010 company signed agreement thinh hung investment co ltd vietnambased company assist thinh hung identifying locating possibly acquiring various business opportunities thinh co ltd subsidiary thinh hung including limited reverse merger stock swap business combination thinh publiclytraded company us exchange services rendered company would receive compensation cash thinh hung common stock combined company june 30 2010 company completed contemplated business combination thinh recognized revenues transaction office space lease company signed 5 year lease agreement corporate office effective may 1 2008 monthly rental 669070 increased 35 per annum commencing thirteenth month initial lease term continuing annually thereafter leases offices vietnam 12 months starting january 2008 july 2008 respectively monthly rental approximately 450 per month future commitments operating leases follows twelve months ending june 30 2011 86007 2012 89017 2013 76777 2014 total minimum lease payments 251801 rent expense 130710 147043 year ended june 30 2010 2009 respectively note 20 going concern uncertainty shown accompanying consolidated financial statements company accumulated deficit 26963783 net loss amounting 3651120 year ended june 30 2010 factors well uncertain conditions company faces daytoday operations respect cash flows create uncertainty companys ability continue going concern financial statements include adjustments might necessary company unable continue going concern company currently significant asset balance labeled construction progress balance subject renewal vietnamese governmental authorities contract due expire october 22 2010 contract renewed amount may impaired management taken action strengthen companys working capital position generate sufficient cash meet operating needs june 30 2011 beyond company also anticipates generating revenue proposed mergers acquisitions assurances made management successful achieving plan president chairman company committed funding companys operations next 12 months item 9 item 8 financial statements phi group inc auditors’ report independent registered public accounting firm shareholders board directors phi group inc opinion financial statements audited accompanying balance sheet phi group inc “company” june 30 2018 related statement operations changes stockholders’ equity deficit cash flows related notes schedules collectively referred “financial statements” financial statements company year ended june 30 2017 audited auditors whose report dated october 12 2017 expressed unqualified opinion financial statements opinion far relates year end june 30 2017 based solely report auditors opinion financial statements present fairly material respects financial position company june 30 2018 results operations cash flows period ended june 30 2018 conformity accounting principles generally accepted united states america basis opinion financial statements responsibility company’s management responsibility express opinion company’s financial statements based audits public accounting firm registered public company accounting oversight board united states “pcaob” required independent respect company accordance us federal securities laws applicable rules regulations securities exchange commission pcaob conducted audits accordance standards pcaob standards require plan perform audit obtain reasonable assurance whether financial statements free material misstatement whether due error fraud audits included performing procedures assess risks material misstatement financial statements whether due error fraud performing procedures respond risks procedures included examining test basis evidence regarding amounts disclosures financial statements audits also included evaluating accounting principles used significant estimates made management well evaluating overall presentation financial statements believe audits provide reasonable basis opinion critical audit matters critical audit matters communicated matters arising current period audit financial statements communicated required communicated audit committee 1 relate accounts disclosures material financial statements 2 involved especially challenging subjective complex judgments communication critical audit matters alter way opinion financial statements taken whole communicating critical audit matters providing separate opinions critical audit matters accounts disclosures relate critical audit matters company’s financial statements prepared using generally accepted accounting principles applicable going concern contemplates realization assets liquidation liabilities normal course business company accumulated deficit 40551299 stockholders’ deficit 4844747 june 30 2018 factors discussed note 22 financial statements raise substantial doubt company’s ability continue going concern management’s plans regard matters also described note 22 consolidated financial statements include adjustments might result outcome uncertainties dylanfloyd accounting consulting served company’s auditor since 2018 newhall california october 12 2018 phi group inc subsidiaries consolidated balance sheets audited accompanying notes form integral part audited consolidated financial statements phi group inc subsidiaries consolidated statement operations audited years ended accompanying notes form integral part audited consolidated financial statements phi group inc subsidiaries consolidated statements cash flows years ended june 30 2018 2017 audited accompanying notes form integral part audited consolidated financial statements phi group inc subsidiaries statement stockholders’ equity deficit years ended june 30 2018 2017 audited accompanying notes form integral part audited consolidated financial statements phi group inc subsidiaries formerly providential holdings inc notes consolidated financial statements note 1 nature business item 1 business overview phi group inc “company” “phi” engaged mergers acquisitions principal wwwphiglobalcom company adopted plans acquire established operating businesses selective industries invest various ventures may potentially create significant longterm value shareholders addition company provides corporate finance services including merger acquisition advisory consulting services client companies wholly owned subsidiary phi capital holdings inc wwwphicapitalholdingscom furthermore phi actively pursuing establishment luxembourg bank fund known “reserved alternative investment fund” “raif” together number initial subfunds investment agriculture energy real estate selective projects assurances made company successful achieving plans originally incorporated june 8 1982 jr consulting inc nevada corporation company applied certificate domestication filed articles domestication become wyoming corporation september 20 2017 beginning company foremost engaged mergers acquisitions operating subsidiary diva entertainment inc operated two modeling agencies one new york one california following business combination providential securities inc californiabased financial services company changed name providential securities inc nevada corporation january 2000 company changed name providential holdings inc february 2000 october 2000 providential securities withdrew securities brokerage membership ceased financial services business subsequently april 2009 company changed name phi group inc october 2000 october 2011 company subsidiaries engaged mergers acquisitions advisory consulting services real estate hospitality development mining oil gas telecommunications technology healthcare private equity special situations october 2011 company discontinued operations providential vietnam ltd philand ranch limited united kingdom corporation together subsidiaries philand ranch singapore philand corporation us philand vietnam ltd vietnam phi gold corporation formerly phi mining corporation nevada corporation phi energy corporation nevada corporation mainly focused acquisition development opportunities energy natural resource businesses present company engaged mergers acquisitions principal investments natural resources energy agriculture consumer goods technology special situations addition phi capital holdings inc wholly owned subsidiary phi continues provide corporate project finance services including merger acquisition advisory consulting services companies variety industries furthermore phi process completing formation luxembourg bank fund known “reserved alternative investment fund” “raif” number initial subfunds thereunder investment agriculture energy real estate selective projects accordance luxembourg law july 23 2016 relative reserved alternative investment funds law august 23 2016 relative commercial companies modified law july 12 2013 relative alternative investment fund managers note 2 summary significant accounting policies principles consolidation consolidated financial statements include accounts phi group inc wholly owned subsidiaries phi capital holdings inc abundant farms inc american pacific resources inc phi group regional center llc well discontinued operations providential securities inc phi energy corporation phi gold corp providential vietnam ltd philand ranch limited including 100 owned subsidiary philand corporation philand vietnam ltd omni resources inc cornerstone biomass corp collectively referred “company” significant intercompany transactions eliminated consolidation use estimates preparation consolidated financial statements conformity accounting principles generally accepted united states america requires management make estimates assumptions affect reported amounts assets liabilities disclosure contingent assets liabilities date financial statements reported amounts revenues expenses reporting period actual results could differ estimates cash equivalents company considers liquid investments maturity three months less date purchase readily convertible cash equivalents marketable securities company’s securities classified availableforsale carried fair value securities classified availableforsale may sold response changes interest rates liquidity needs purposes investment marketable securities typically represents less twenty percent 20 outstanding common stock equivalents investee security quoted national exchange otc markets investment accounted accordance provisions asc 320 previously sfas 115 unrealized holding gains losses availableforsale securities excluded earnings reported separate component stockholder’s equity realized gains losses securities classified availableforsale reported earnings based upon adjusted cost specific security sold june 30 2018 2017 marketable securities recorded 1100483 502696 respectively based upon fair value marketable securities time accounts receivable management reviews composition accounts receivable analyzes historical bad debts june 30 2018 company 432000 accounts receivable impairment longlived assets effective january 1 2002 company adopted asc 350 previously sfas 144 “accounting impairment disposal longlived assets” addresses financial accounting reporting impairment disposal longlived assets supersedes sfas 121 “accounting impairment longlived assets longlived assets disposed of” accounting reporting provisions apb opinion 30 “reporting results operations disposal segment business” company periodically evaluates carrying value longlived assets held used accordance asc 350 asc 350 requires impairment losses recorded longlived assets used operations indicators impairment present undiscounted cash flows estimated generated assets less assets’ carrying amounts event loss recognized based amount carrying amount exceeds fair market value longlived assets loss longlived assets disposed determined similar manner except fair market values reduced cost disposal property equipment property equipment stated cost maintenance repair costs charged expense incurred costs major additions betterments capitalized property equipment sold otherwise disposed cost related accumulated depreciation eliminated accounts resulting gain loss reflected income depreciation computed using straightline method estimated useful lives assets ranging three ten years depreciation amortization cost property equipment depreciated estimated useful lives related assets depreciation amortization fixed assets computed straightline basis net earnings loss per share company adopted provisions asc 260 previously sfas 128 asc 260 eliminates presentation primary fully diluted earnings per share “eps” requires presentation basic diluted eps basic eps computed dividing income loss available common stockholders weightedaverage number common shares outstanding period diluted eps based weightedaverage number shares common stock outstanding period common stock equivalents outstanding end period net earnings loss per share computed follows stockbased compensation effective july 1 2006 company adopted asc 7181025 previously sfas 123r accordingly adopted modified prospective application method asc 7181025 applied new awards modified repurchased cancelled effective date additionally compensation cost portion awards outstanding date adoption requisite service rendered unvested options recognized period time remaining requisite services rendered fair value financial instruments fair value definition hierarchy fair value defined price would received sell asset paid transfer liability orderly transaction market participants measurement date assets liabilities measured fair value categorized based whether inputs observable market degree inputs observable categorization financial assets liabilities within valuation hierarchy based upon lowest level input significant fair value measurement fair value hierarchy inputs used measuring fair value maximizes use observable inputs minimizes use unobservable inputs requiring observable inputs used available valuation techniques consistent market income approach used measure fair value fair value hierarchy categorized three levels based inputs follows level 1 valuations based unadjusted quoted prices active markets identical assets liabilities fund ability access level 2 valuations based inputs quoted prices included level 1 observable either directly indirectly level 3 valuations based inputs unobservable significant overall fair value measurement fair value marketbased measure based assumptions prices inputs considered perspective market participant current measurement date rather entityspecific measure therefore even market assumptions readily available company’s assumptions set reflect market participants would use pricing asset liability measurement date availability valuation techniques observable inputs vary investment affected wide variety factors including type investment whether investment new yet established marketplace liquidity markets characteristics particular transaction extent valuation based upon models inputs less observable unobservable market determination fair value requires judgment inherent uncertainty valuation estimated values may materially higher lower values would used ready market investments existed accordingly degree judgment exercised fund determining fair value greatest investments categorized level 3 certain cases inputs used measure fair value may fall different levels fair value hierarchy cases level fair value hierarchy fair value measurement falls entirety determined based upon lowest level input significant fair value measurement fair value valuation techniques inputs company holds may invest public securities traded public exchanges overthecounter otc private securities real estate convertible securities interest bearing securities types securities adopted specific techniques respective valuations equity securities public companies unrestricted company values investments securities freely tradable listed major securities exchanges last reported sales price valuation date extent securities actively traded valuation adjustments applied categorized level 1 fair value hierarchy securities traded inactive markets valued reference similar instruments generally categorized level 2 3 fair value hierarchy restricted securities traded public exchanges overthecounter otc formal restrictions limit ie rule 144 holding periods underwriter’s lockups sale shall valued closing price date valuation less applicable discounts company may apply discount securities rule 144 restrictions additional discounts may assessed company believes mitigating factors warrant additional discounting determining potential additional discounts factors taken consideration include limited securities’ trading characteristics volume length overall impact restriction well macroeconomic factors valuations discounted appropriately securities may freely traded determined exchange otc listed price accurately reflect fair market value company may elect treat security private company apply alternative valuation method investments restricted securities public companies may included level 2 fair value hierarchy however extent significant inputs used determine liquidity discounts observable investments restricted securities public companies may categorized level 3 fair value hierarchy company’s financial instruments primarily consist cash equivalents accounts receivable marketable securities shortterm notes payable convertible notes derivative liability accounts payable balance sheet dates estimated fair values financial instruments materially different carrying values presented balance sheet primarily attributed short maturities instruments effective july 1 2008 company adopted asc 820 previously sfas 157 fair value measurements adopted statement assets liabilities shown table asc 820 clarifies definition fair value prescribes methods measuring fair value establishes fair value hierarchy based inputs used measure fair value expands disclosures use fair value measurements adoption asc 820 material impact fair value measurements asc 820 permits company defer recognition measurement nonfinancial assets nonfinancial liabilities january 1 2010 june 30 2018 company nonfinancial assets nonfinancial liabilities recognized disclosed fair value asc 820 requires financial assets liabilities reported fair value categorized one types investments based upon methodology mentioned level 1 level 2 level 3 determining fair value assets measured fair value recurring basis summarized company also convertible notes derivative liabilities disclosed report measured fair value regular basis paid exercised company uses various approaches measure fair value availableforsale securities applying threelevel valuation hierarchy disclosures specified asc 820 level 1 securities measured using quoted prices active markets identical assets liabilities company’s policy regarding transfers andor level 3 depends trading activity security volatility security observable units clearly represents fair value security level 3 security measured using fairly represented fair value transfer securities either level 1 level 2 depending type inputs revenue recognition standards asc 60610 provides following overview revenue recognized entity’s contracts customers entity recognizes revenue depict transfer promised goods services customers amount reflects consideration entity expects entitled exchange goods services step 1 identify contracts customer step 2 identify performance obligations contract step 3 determine transaction price transaction price amount consideration contract entity expects entitled exchange transferring promised goods services customer step 4 allocate transaction price performance obligations contract entity typically allocates transaction price performance obligation basis relative standalone selling prices distinct good service promised contract step 5 recognize revenue entity satisfies performance obligation entity recognizes revenue satisfies performance obligation transferring promised good service customer obtains control good service amount revenue recognized amount allocated satisfied performance obligation performance obligation may satisfied point time typically promises transfer goods customer time typically promises transfer service customer performance obligations satisfied time entity recognizes revenue time selecting appropriate method measuring entity’s progress toward complete satisfaction performance obligation paragraphs 60610 2523 2530 addition asc 60610 contains guidance disclosures related revenue notes following also includes cohesive set disclosure requirements would result entity providing users financial statements comprehensive information nature amount timing uncertainty revenue cash flows arising entity’s contracts customers specifically section 6061050 requires entity provide information revenue recognized contracts customers including disaggregation revenue appropriate categories contract balances including opening closing balances receivables contract assets contract liabilities performance obligations including entity typically satisfies performance obligations transaction prices allocated remaining performance obligations contract significant judgments changes judgments made applying requirements contracts additionally section 3404050 requires entity provide quantitative andor qualitative information assets recognized costs obtain fulfill contract customer company’s revenue recognition policies compliance asc 60610 company recognizes consulting advisory fee revenues accordance abovementioned guidelines expenses recognized period corresponding liability incurred advertising company expenses advertising costs incurred advertising costs years ended june 30 2018 2017 36221 31413 respectively increase advertising expenses current year primarily due increase 4808 investor relations expenses fiscal year ended june 30 2018 compared previous fiscal year comprehensive income loss asc 2201045 previously sfas 130 reporting comprehensive income establishes standards reporting display comprehensive income components accumulated balances comprehensive income defined include changes equity except resulting investments owners distributions owners among disclosures sfas 130 requires items required recognized current accounting standards components comprehensive income reported financial statement displayed prominence financial statements june 30 2018 2017 respectively accumulated comprehensive incomes 751962 153474 presented accompanying consolidated balance sheets income taxes company accounts income taxes accordance asc 740 previously sfas 109 “accounting income taxes” deferred taxes provided liability method whereby deferred tax assets recognized deductible temporary differences deferred tax liabilities recognized taxable temporary differences temporary differences reported amounts assets liabilities tax bases deferred tax assets reduced valuation allowance opinion management likely portion deferred tax assets realized deferred tax assets liabilities adjusted effects changes tax laws rates date enactment reporting segments asc 280 previously statement financial accounting standards 131 disclosures segments enterprise related information supersedes statement financial accounting standards 14 financial reporting segments business enterprise establishes standards way public enterprises report information operating segments annual financial statements requires reporting selected information operating segments interim financial statements regarding products services geographic areas major customers asc 280 defines operating segments components enterprise separate financial information available evaluated regularly chief operating decision maker deciding allocate resources assessing performance company operated two segments generated revenues year ended june 30 2018 one segment year ended june 30 2017 risks uncertainties normal course business company subject certain risks uncertainties company provides service receives marketable securities upon execution transactions consequently value securities received customers affected economic fluctuations customer’s business growth actual realized value securities could significantly different recorded value recent accounting pronouncements update 201813 august 2018 fair value measurement topic 820 changes disclosure requirements fair value measurement modifications following disclosure requirements modified topic 820 1 lieu rollforward level 3 fair value measurements nonpublic entity required disclose transfers level 3 fair value hierarchy purchases issues level 3 assets liabilities 2 investments certain entities calculate net asset value entity required disclose timing liquidation investee’s assets date restrictions redemption might lapse investee communicated timing entity announced timing publicly 3 amendments clarify measurement uncertainty disclosure communicate information uncertainty measurement reporting date additions following disclosure requirements added topic 820 however disclosures required nonpublic entities 1 changes unrealized gains losses period included comprehensive income recurring level 3 fair value measurements held end reporting period 2 range weighted average significant unobservable inputs used develop level 3 fair value measurements certain unobservable inputs entity may disclose quantitative information median arithmetic average lieu weighted average entity determines quantitative information would reasonable rational method reflect distribution unobservable inputs used develop level 3 fair value measurements amendments update effective entities fiscal years interim periods within fiscal years beginning december 15 2019 update 201807 june 2018 compensation stock compensation topic 718 improvements nonemployee sharebased payment accounting main provisions amendments update expand scope topic 718 include sharebased payment transactions acquiring goods services nonemployees entity apply requirements topic 718 nonemployee awards except specific guidance inputs option pricing model attribution cost period time sharebased payment awards vest pattern cost recognition period amendments specify topic 718 applies sharebased payment transactions grantor acquires goods services used consumed grantor’s operations issuing sharebased payment awards amendments also clarify topic 718 apply sharebased payments used effectively provide 1 financing issuer 2 awards granted conjunction selling goods services customers part contract accounted topic 606 revenue contracts customers amendments update effective public business entities fiscal years beginning december 15 2018 including interim periods within fiscal year update 201713 september 2017 revenue recognition topic 605 revenue contracts customers topic 606 fasb accounting standards updates 201409 revenue contracts customers topic 606 issued may 2014 codified asc topic 606 revenue contracts customers 201602 transition provisions asc topic 606 require public business entity certain specified entities adopt asc topic 606 annual reporting 3 periods beginning december 15 2017 including interim reporting periods within reporting period fn2 entities required adopt asc topic 606 annual reporting periods beginning december 15 2018 interim reporting periods within annual reporting periods beginning december 15 2019 update 201610 april 2016 revenue contracts customers topic 606 identifying performance obligations licensing core principle guidance topic 606 entity recognize revenue depict transfer promised goods services customers amount reflects consideration entity expects entitled exchange goods services achieve core principle entity apply following steps 1 identify contracts customer 2 identify performance obligations contract 3 determine transaction price 4 allocate transaction price performance obligations contract 5 recognize revenue entity satisfies performance obligation amendments update change core principle guidance topic 606 rather amendments update clarify following two aspects topic 606 identifying performance obligations licensing implementation guidance retaining related principles areas company either evaluated currently evaluating implications pronouncements possible impact may company’s financial statements cases management determined implementation pronouncements would material impact financial statements taken whole note 3 loans receivable loans receivable consist following june 30 2018 2017 note 4 assets comprise following june 30 2018 2017 investments consist 5000 investment aquarius power inc renewable energy technology company 51 ownership twentyone mining claims area approximately 400 acres granite mining district grant county oregon usa acquired american pacific resources inc subsidiary company exchange total purchase price twentyfive million us dollars us 25000000 paid combination cash convertible demand promissory note phi group inc’s class series ii convertible cumulative redeemable preferred stock contract assets consist balance 697841 agreement dated march 27 2018 client total amount 2000000 1212159 received recognized revenue fiscal year ended june 30 2018 note 5 marketable equity securities available sale company’s marketable securities classified availableforsale carried fair value securities comprised shares common stock investee securities classified availableforsale may sold response changes interest rates liquidity needs purposes investment marketable securities represents less twenty percent 20 outstanding common stock equivalents investee security nationally quoted national association securities dealers otc bulletin board “otcbb” otc markets investment accounted accordance provisions sfas 115 marketable securities owned company classified available sale june 30 2018 consisted 33805106 shares myson group inc formerly vanguard mining corporation 292050000 shares sports pouch beverage company public companies traded public company traded otc markets trading symbols mysn spbv respectively fair value marketable securities recorded june 30 2018 1100483 fiscal year ended june 30 2018 transfer securities level 3 level 2 note 6 property equipment fiscal year ended june 30 2017 company sold ten acres land parcel identification numbers 09705010180 190 suwannee county florida june 30 2018 company property equipment except 51 ownership twentyone mining claims area approximately 400 acres granite mining district grant county oregon usa owned american pacific resources inc subsidiary company’s note 7 discontinued operations june 30 2012 company recognized businesses phi gold corp formerly phi mining corporation providential vietnam ltd phi energy corp philand ranch ltd united kingdom corporation together whollyowned subsidiaries philand corporation usa philand ranch ltd singapore philand vietnam ltd discontinued operations practical business accounting purposes june 30 2018 company balance 1255037 longterm liabilities discontinued operations consisting 954337 philand ranch ltd 215000 preferred stock providential holdings inc former subsidiary company 85700 contingency liabilities note 8 current liabilities current liabilities company consist followings june 30 2018 2017 current accrued expenses current accrued expenses consist 238165 accrued salaries payroll tax liabilities 149359 accrued interest shortterm notes 4681 dividends payable class series ii preferred stock contract liabilities consist balance 697841 result agreement dated march 27 2018 client total amount 2000000 1212159 recognized revenue thus reducing original contract liabilities amount fiscal year ended june 30 2018 note 9 longterm liabilities june 30 2018 2017 longterm liabilities consist longterm accrued expenses longterm accrued expenses consist accrued salaries payroll taxes 698653 accrued legal fees 172091 consulting fees 165850 accrued expenses 26888 accrued interest expenses longterm accrued interest expenses consist accrued interest notes payable amount 2005815 advances customers company recorded 288219 advances customers reserve consulting fees previously received client company able complete consulting services due client’s inability provide gaapcompliant audited financial statements order file registration statement securities exchange commission demand promissory note company issued demand promissory note amount 24310400 rush gold royalty inc wyoming corporation connection acquisition 51 ownership twentyone mining claims area approximately 400 acres granite mining district grant county oregon usa american pacific resources inc subsidiary company june 30 2018 balance convertible demand promissory note 24048500 liabilties discontinued operations june 30 2012 company recognized businesses phi gold corp formerly phi mining corporation providential vietnam ltd phi energy corp philand ranch ltd united kingdom corporation together whollyowned subsidiaries philand corporation usa philand ranch ltd singapore philand vietnam ltd discontinued operations practical business accounting purposes june 30 2018 company carried balance 1040037 longterm liabilities discontinued operations preferred stock liabilities discontinued operations june 30 2017 company reclassified 215000 longterm liabilities payable holders preferred stock providential securities inc previous subsidiary company discontinued year 2000 early 2000’s company made offer preferred stockholders receive shares common stock company exchange preferred shares discontinued subsidiary small number preferred shareholders responded accepted offer recent years company also attempted contact preferred shareholders time received response company recorded amount 215000 longterm liability note 10 due officers directors due officer represents loans advances made officers directors company subsidiaries unsecured due demand june 30 2018 2017 balances 233577 592141 respectively note 11 loans promissory notes short term notes payable course business company obtained shortterm loans individuals institutional investors time raised money issuing restricted common stock company auspices rule 144 june 30 2018 company 803310 shortterm notes payable 2133947 accrued unpaid interest notes bear interest rates ranging 0 36 per annum convertible promissory notes fiscal year ended june 30 2018 company issued following convertible promissory notes various private investment funds july 20 2017 company issued new convertible promissory note power lending group 28000 interest rate 8 convertible common stock company 42 discount january 18 2018 company paid total 4361096 power lending group amount included principal prepayment premium accrued interest note paid full january 18 2018 august 3 2017 company issued new convertible promissory note jsj investments inc 78750 interest rate 10 convertible common stock company 45 discount january 30 2018 company paid total 11798476 jsj investments inc amount included principal amount 78750 prepayment premium 3543750 accrued unpaid interest 379726 note paid full january 30 2018 august 15 2017 company issued new convertible promissory note power lending group 33000 interest rate 10 convertible common stock company 42 discount february 5 2018 company paid total 5130099 power lending group amount included principal prepayment premium accrued interest note paid full february 5 2018 august 24 2017 company issued new convertible promissory note lg capital 78750 interest rate 8 convertible common stock company 50 discount february 20 2018 company paid total 12265582 lg capital amount included principal prepayment premium accrued interest note paid full february 20 2018 october 18 2017 company issued new convertible promissory note power lending group 53000 interest rate 8 convertible common stock company 42 discount average two lowest trading prices closing bids ten trading days immediately prior date conversion maturity date note 7202018 april 17 2018 company made payment amount 2500000 consisting 1666667 principal 833333 prepayment premium power lending group principal balance due remaining note payment 3633333 april 19 2018 company issued 1169591 shares freetrading common stock phi group inc power lending group conversion 2000000 principal amount note principal amount note remaining conversion 1633333 april 23 2018 company issued 1127820 shares freetrading common stock phi group inc power lending group conversion 1500000 principal amount note principal amount note remaining conversion 133333 april 24 2018 company issued 295156 shares freetrading common stock phi group inc power lending conversion 133333 principal amount note together 2120 accrued unpaid interest thereto totaling 345333 principal amount note remaining conversion 000 october 26 2017 company issued new convertible promissory note crown bridge partners llc 35000 interest rate 5 convertible common stock company 50 discount average two lowest trading prices closing bids twenty trading days immediately prior date conversion maturity date note 10262018 connection note company issued 87500 warrants crown bridge partners llc purchase common stock company exercise price 040 per share exercise period commences issuance date ends oneyear anniversary thereof may 29 2018 company issued 3159521 shares freetrading common stock phi group inc crown bridge partners conversion principal 99247 accrued interest 50000 fees note totaling 3649247 principal balance due remaining note conversion 000 november 24 2017 company issued new convertible promissory note einstein investments llc 115500 interest rate 10 convertible common stock company 50 discount average two lowest trading prices closing bids ten trading days immediately prior date conversion maturity date note 10262018 june 04 2018 company issued 3149607 shares freetrading common stock phi group inc einstein investments llc conversion 4405096 principal amount together 594904 accrued interest note totaling 50000 principal balance due remaining note conversion 7144904 january 18 2018 company issued new convertible promissory note jsj investments inc 78750 interest rate 10 convertible common stock company 45 discount average three lowest trading prices closing bids twenty trading days immediately prior date conversion maturity date note 01182019 january 18 2018 company issued new convertible promissory note power lending group 33000 interest rate 8 convertible common stock company 42 discount average two lowest trading prices closing bids ten trading days immediately prior date conversion maturity date note 10102018 january 26 2018 company issued new convertible promissory note power lending group 33000 interest rate 8 convertible common stock company 42 discount average two lowest trading prices closing bids ten trading days immediately prior date conversion maturity date note 11152018 january 31 2018 company issued new convertible promissory note jsj investments inc 78750 interest rate 10 convertible common stock company 45 discount average three lowest trading prices closing bids twenty trading days immediately prior date conversion maturity date note 01182019 january 31 2018 company issued new convertible promissory note crown bridge partners llc 50000 interest rate 5 convertible common stock company 50 discount average two lowest trading prices closing bids twenty trading days immediately prior date conversion maturity date note 01312019 february 01 2018 company issued new convertible promissory note adar bays 60000 interest rate 6 convertible common stock company 50 discount average two lowest trading prices twenty five trading days immediately prior date conversion maturity date note 02012019 february 02 2018 company issued new convertible promissory note auctus fund llc 75000 interest rate 12 convertible common stock company 50 discount average two lowest trading prices twenty five trading days immediately prior date conversion maturity date note 11022018 february 22 2018 company issued new convertible promissory note power lending group 33000 interest rate 8 convertible common stock company 42 discount average two lowest trading prices closing bids ten trading days immediately prior date conversion maturity date note 11302018 march 21 2018 company issued new convertible promissory note jsj investments inc 78750 interest rate 10 convertible common stock company 45 discount average three lowest trading prices closing bids twenty trading days immediately prior date conversion maturity date note 03212019 april 2 2018 company issued new convertible promissory note crown bridge partners llc 55000 interest rate 10 convertible common stock company 50 discount average two lowest trading prices closing bids twenty trading days immediately prior date conversion maturity date note 04022019 april 10 2018 company issued new convertible promissory note power lending group 33000 interest rate 8 convertible common stock company 42 discount average two lowest trading prices closing bids ten trading days immediately prior date conversion maturity date note 01302019 june 12 2018 company issued new convertible promissory note crown bridge partners llc 55000 interest rate 10 convertible common stock company 50 discount average two lowest trading prices closing bids twenty trading days immediately prior date conversion maturity date note 06122019 june 25 2018 company issued new convertible promissory note jsj investments inc 100000 interest rate 10 convertible common stock company 45 discount average three lowest trading prices closing bids twenty trading days immediately prior date conversion maturity date note 06252019 june 30 2018 principal balance outstanding convertible notes 834699 total discount 301457 accrued interest 21227 total derivative liabilities 738814 company relies professional thirdparty valuation record value derivative liabilities discounts changes fair value derivatives connection convertible notes warrants related convertible notes company intends repay notes cash much practical note 12 litigation legal proceeding settled unpaid june 30 2018 quang van cao nhan thi nguyen cao vs providential securities inc et al case originally submitted orange county superior court ca june 25 1997 case 781121 subsequently moved nasd dispute resolution arbitration august 24 2000 company’s legal counsel negotiated claimant’s counsel unilaterally reached settlement approved company process renegotiating terms said settlement claimants filed request arbitration hearing national association securities dealers october 4 2000 case 9903160 thereafter claimants filed complaint orange county superior court ca october 31 2000 case 00cc13067 alleged breach contract damages sum 75000 plus prejudgment interest costs incurred connection complaint relief without admitting denying allegations company reached settlement agreement claimants whereby company would pay claimants total 62500 plus 4500 administrative costs date report company paid 2500 subject entry judgment 79000 may 2011 claimants filed application renewal judgment total 14049078 june 30 2018 company accrued 172091 potential liabilities connection case accompanying consolidated financial statements william davidson vs doan et al february 01 2010 company notified suit filed superior court state california county los angeles november 24 2009 william davidson individual martin doan henry fahman benjamin tran hrciti corporation providential capital inc collectively referred “defendants” case bc 426831 plaintiff demanded amount less 14000000 defendants promissory notes outstanding plaintiff company july 09 2012 william davidson phi capital holdings inc formerly providential capital inc subsidiary company reached settlement agreement respect whereby phi capital agreed pay william davidson total 200000 period nineteen months beginning september 1 2012 since november 30 2012 william davidson converted portions total amount common stock phi group inc lieu cash payment company accrued 90000 required liability associated balance notes accompanying consolidated financial statements june 30 2018 note 13 payroll tax liabilities payroll liabilities accrued recorded accrued expenses consolidated balance sheet fiscal year ended june 30 2014 company paid 4197422 internal revenue service 1928994 state california employment development department towards balance 118399 payroll tax penalties interest claimed agencies company resolved remaining balances internal revenue service state california employment department june 30 2018 note 14 basic diluted net loss per share net loss per share calculated accordance sfas 128 “earnings per share” provision sfas 128 basic net loss per share computed dividing net loss period weightedaverage number common shares outstanding period diluted eps based weightedaverage number shares common stock outstanding period common stock equivalents outstanding end period basic diluted weighted average numbers shares year ended june 30 2018 since inclusion common stock equivalents antidilutive note 15 stockholder’s equity june 30 2018 total number authorized capital stock company 2000000000 shares par value 0001 per share consisting 1900000000 shares voting common stock par value 0001 per share 100000000 shares preferred stock par value 0001 per share rights terms associated preferred stock determined board directors company treasury stock balance treasury stock june 30 2018 487767 shares valued 44170 based cost basis common stock fiscal year ended june 30 2018 company issued following amounts common stock july 05 2017 company issued 740741 shares freetrading common stock phi group inc power lending group ltd holder convertible promissory note dated 12152016 company conversion 1000000 principal amount note conversion price 00135 per share principal amount note conversion 1450000 july 11 2017 company issued 800000 shares freetrading common stock phi group inc auctus fund llc holder convertible promissory note dated 8162016 company conversion 515200 consisting 348517 principal amount note 166683 accrued unpaid interest thereto conversion price 000644 per share principal amount note conversion 3261312 subsequently july 24 2017 company paid total 4953072 auctus fund llc consisting 3261312 principal amount balance prepayment premium accrued unpaid interest connection convertible promissory note dated 81616 note paid full principal balance due remaining accrued unpaid interest remaining payment 000 july 17 2017 company issued 880000 shares freetrading common stock phi group inc power lending group ltd holder convertible promissory note dated 12152016 company conversion 792000 principal amount note conversion price 0009 per share principal amount note conversion 6580 july 21 2017 company issued 1019872 shares freetrading common stock phi group inc power lending group ltd holder convertible promissory note dated 12152016 company conversion 795500 consisting 6580 principal amount note 137500 accrued unpaid interest thereto conversion price 00078 per share principal balance due remaining accrued unpaid interest remaining conversion 000 july 25 2017 henry fahman chairman chief executive officer company converted 300000 indebtedness owed company 20000000 shares restricted common stock phi group inc conversion price 0015 per share conversion restricted common stock company effectuated pursuant resolutions company’s board directors dated march 12 2012 june 06 2012 november 2 2012 remain full force effect allowing creditors company convert outstanding indebtedness accrued unpaid interest thereof shares common stock phi group inc relying exemption registration requirements united states securities act 1933 amended “act” july 25 2017 company issued total 1533333 shares restricted common stock phi group inc pursuant rule 144 two nonus shareholders connection private stock purchase agreements dated july 19 2017 july 20 2017 respectively shareholders company total 2300000 purchase price 0015 per share october 17 2017 company issued 434783 shares freetrading common stock phi group inc power lending group ltd holder convertible promissory note dated april 12 2017 company conversion 1200000 principal amount note october 19 2017 company issued 371057 shares freetrading common stock phi group inc jsj investments inc holder convertible promissory note dated february 2 2017 company conversion 1000000 principal balance note october 23 2017 company issued 622407 shares freetrading common stock phi group inc power lending group ltd holder convertible promissory note dated april 12 2017 company conversion 1500000 principal balance note october 24 2017 company issued 250000 shares freetrading common stock phi group inc ema financial llc holder convertible promissory note dated april 04 2017 company conversion 358750 principal amount note less 75000 applicable fees note october 31 2017 company issued 419212 shares freetrading common stock phi group inc power lending group ltd holder convertible promissory note dated april 12 2017 company conversion 650000 remaining principal amount note together 201000 accrued unpaid interest thereto totaling 851000 november 7 2017 company issued 600000 shares freetrading common stock phi group inc ema financial llc holder convertible promissory note dated april 04 2017 company conversion 375000 principal balance note less 135000 applicable fees note november 8 2017 company issued 2154700 shares freetrading common stock phi group inc auctus fund llc holder convertible promissory note dated march 3 2017 company conversion 1785243 principal balance note together 335617 accrued unpaid interest thereto 50000 applicable fee totaling 2170860 november 16 2017 company issued 80000 shares restricted common stock phi group inc andreas held current shareholder company 1920 cash auspices rule 144 pursuant private stock purchase agreement dated november 14 2017 november 21 2017 company issued 1000000 shares freetrading common stock phi group inc ema financial llc holder convertible promissory note dated april 04 2017 company conversion 595000 principal balance note less 105000 applicable fees note december 01 2017 company issued 2346000 shares freetrading common stock phi group inc auctus fund llc holder convertible promissory note dated march 3 2017 company conversion 1506255 principal balance note together 20257 accrued unpaid interest thereto 50000 applicable fee totaling 1576512 december 05 2017 company issued 1385677 shares freetrading common stock phi group inc jsj investments inc holder convertible promissory note dated february 2 2017 company conversion 1100000 principal balance note together 165123 accrued unpaid interest thereto totaling 1265123 december 12 2017 company issued 2000000 shares freetrading common stock phi group inc ema financial llc holder convertible promissory note dated april 04 2017 company conversion 714000 principal balance note less 105000 applicable fees note december 13 2017 company issued 2250821 shares freetrading common stock phi group inc jsj investments inc holder 40000 convertible promissory note dated april 5 2017 company conversion 1242075 principal balance note december 14 2017 company issued 2744300 shares freetrading common stock phi group inc auctus fund llc holder convertible promissory note dated march 3 2017 company conversion 1033952 principal balance note together 13768 accrued unpaid interest thereto 50000 applicable fee totaling 1097720 december 14 2017 company issued 1724138 shares restricted common stock phi group inc steve truong 20000 cash auspices rule 144 pursuant private stock purchase agreement dated december 14 2017 december 19 2017 company issued 2500000 shares freetrading common stock phi group inc ema financial llc holder convertible promissory note dated april 04 2017 company conversion 875000 principal balance note less 105000 applicable fees note december 20 2017 company issued 2913837 shares freetrading common stock phi group inc jsj investments inc holder 40000 convertible promissory note dated april 5 2017 company conversion 1607947 principal balance note december 29 2017 company issued 2300000 shares freetrading common stock phi group inc crown bridge partners llc holder 3500000 convertible promissory note dated june 9 2017 company conversion 755000 principal 50000 fees note totaling 805000 december 29 2017 company issued 2500000 shares freetrading common stock phi group inc ema financial llc holder convertible promissory note dated april 04 2017 company conversion 875000 principal balance note less 105000 applicable fees note january 08 2018 company issued 1835795 shares freetrading common stock phi group inc auctus fund llc holder convertible promissory note dated march 03 2017 company conversion 674550 principal balance note 9768 accrued unpaid interest 50000 conversion fee note totaling 734318 principal balance due remaining note conversion 000 january 09 2018 company issued 2601957 shares freetrading common stock phi group inc jsj investments inc holder convertible promissory note dated april 05 2017 company conversion 1149978 principal balance accrued unpaid interest 285864 totaling 1435842 principal balance due remaining note conversion 000 january 11 2018 company issued 2900000 shares freetrading common stock phi group inc crown bridge partners llc holder 3500000 convertible promissory note dated june 9 2017 company conversion 965000 principal 50000 fees note totaling 1015000 principal balance due remaining note conversion 1780000 january 25 2018 company issued 2500000 shares freetrading common stock phi group inc ema financial llc holder convertible promissory note dated april 4 2017 company conversion 962500 principal balance note less 1050 conversion fees note principal balance due remaining note conversion 997750 january 29 2018 company issued 3812188 shares freetrading common stock phi group inc ema financial llc holder convertible promissory note dated april 4 2017 company conversion 997550 principal balance note 364943 accrued unpaid interest 1050 legal transfer agent fees conversion totaling 1446793 note paid full january 29 2018 principal balance due remaining note conversion 000 january 29 2018 company issued 2500000 shares freetrading common stock phi group inc crown bridge partners llc holder 3500000 convertible promissory note dated june 9 2017 company conversion 956250 principal 50000 fees note totaling 1006250 principal balance due remaining note conversion 823750 january 30 2018 company issued 100000 shares phi group inc’s restricted common stock andreas held longterm shareholder phi group inc’s 98100 cash january 30 2018 company issued 100000 shares phi group inc’s restricted common stock cuong tran independent consultant technical consulting service february 8 2018 company issued 2509693 shares freetrading common stock phi group inc crown bridge partners llc holder 3500000 convertible promissory note dated june 9 2017 company conversion 823750 principal 101266 accrued interest 50000 fees note totaling 975016 principal balance due remaining note conversion 000 february 8 2018 henry fahman company’s chief executive officer chief financial officer converted 15000000 accrued unpaid salary fiscal year ended june 30 2011 4746084 shares restricted common stock phi group inc effective price 0031605 per share pursuant company’s corporate resolutions dated november 2 2012 still remain full force effect february 8 2018 tina phan company’s corporate secretary treasurer converted 6000000 accrued unpaid salary fiscal year ended june 30 2011 1898434 shares restricted common stock phi group inc effective price 0031605 per share pursuant company’s corporate resolutions dated november 2 2012 still remain full force effect february 28 2018 company issued 4744007 shares freetrading common stock phi group inc crown bridge partners llc holder common stock purchase warrant dated june 9 2017 connection 3500000 convertible promissory note june 9 2017 company cashless exercise 1730000 value warrants total warrant value remaining exercise 1770000 april 13 2018 company issued 4653954 shares freetrading common stock phi group inc crown bridge partners llc holder common stock purchase warrant dated june 9 2017 connection 3500000 convertible promissory note june 9 2017 company cashless exercise 1770000 value warrants total warrant value remaining exercise 000 april 19 2018 company issued 1169591 shares freetrading common stock phi group inc power lending group ltd holder convertible promissory note dated 10182017 company conversion 2000000 principal amount note conversion price 00171 per share principal amount note remaining conversion 1633333 april 23 2018 company issued 1127820 shares freetrading common stock phi group inc power lending group ltd holder convertible promissory note dated 10182017 company conversion 1500000 principal amount note conversion price 00133 per share principal amount note remaining conversion 133333 april 24 2018 company issued 295156 shares freetrading common stock phi group inc power lending group ltd holder convertible promissory note dated 10182017 company conversion 133333 principal amount note together 2120 accrued unpaid interest thereto totaling 345333 conversion price 00117 per share principal amount note remaining conversion 000 april 27 2018 tina phan company’s corporate secretary treasurer converted 12000000 accrued unpaid salaries fiscal years ended june 30 2012 june 30 2013 4629630 shares restricted common stock phi group inc effective price 002592 per share pursuant company’s corporate resolutions dated november 2 2012 still remain full force effect april 27 2018 henry fahman company’s chief executive officer chief financial officer converted 30000000 accrued unpaid salaries fiscal years ended june 30 2012 june 30 2013 11574074 shares restricted common stock phi group inc effective price 002592 per share pursuant company’s corporate resolutions dated november 2 2012 still remain full force effect may 29 2018 company issued 3159521 shares freetrading common stock phi group inc crown bridge partners llc holder 3500000 convertible promissory note dated october 26 2017 company conversion principal 99247 accrued interest 50000 fees note totaling 3649247 principal balance due remaining note conversion 000 june 04 2018 company issued 3149607 shares freetrading common stock phi group inc einstein investments llc holder 115000 convertible promissory note dated november 24 2017 company conversion 4405096 principal amount together 594904 accrued interest note totaling 50000 principal balance due remaining note conversion 7144904 june 21 2018 company issued 6048786 shares freetrading common stock phi group inc crown bridge partners llc holder common stock purchase warrant dated october 26 2017 connection 3500000 convertible promissory note october 26 2017 company cashless exercise 2228500 value warrants total warrant value remaining exercise 1271500 june 26 2018 company issued 157604 shares freetrading common stock phi group inc buu chung holder convertible promissory note dated 4142005 company conversion 3000 principal amount principal balance due remaining note conversion 000 june 30 2018 135893815 shares company’s common stock issued outstanding excluding 5673327 shares common stock set aside special dividend distribution preferred stock company filed certificates designation amendments certificate designation nevada secretary state designate company’s authorized preferred stock follows class preferred stock designations amounts dividends 1 class series cumulative convertible redeemable preferred stock designation first twenty million 20000000 shares previously authorized 100000000 shares preferred stock par value 0001 per share shall class series cumulative convertible redeemable preferred stock b number shares number shares class series preferred stock authorized shall twenty million 20000000 shares c dividends holder class series preferred stock entitled receive ten percent 10 noncompounding cumulative dividends per annum payable semiannually 2 class series ii cumulative convertible redeemable preferred stock designation next twentyfive million 25000000 shares previously authorized 100000000 shares preferred stock par value 0001 per share shall class series ii cumulative convertible redeemable preferred stock “class series ii preferred stock” b number shares number shares class series ii preferred stock authorized shall twentyfive million 25000000 shares c dividends holder class series ii preferred stock entitled receive eight percent 8 cumulative dividends per annum payable semiannually 3 class series iii cumulative convertible redeemable preferred stock designation next fifty million 50000000 shares previously authorized 100000000 shares preferred stock par value 0001 per share shall class series iii cumulative convertible redeemable preferred stock “class series iii preferred stock ” b number shares number shares class series iii preferred stock authorized shall fifty million 50000000 shares c dividends holder class series iii preferred stock entitled receive eight percent 8 cumulative dividends per annum payable semiannually ii conversion 1 conversion series andor series ii class preferred stock common stock phi group inc share class preferred stock either series ii shall convertible company’s common stock time two years date issuance variable conversion price defined herein common stock “variable conversion price” shall mean 75 multiplied market price defined herein representing discount rate 25 “market price” means average trading price company’s common stock ten 10 tradingday period ending one trading day prior date conversion notice sent holder class preferred stock company via facsimile email “conversion date” “trading price” means security date closing price otc markets otcqb nasdaq stock markets applicable trading market reported reliable reporting service “reporting service” mutually acceptable company holder class preferred stock 2 conversion series andor series ii class preferred stock common stock subsidiary phi group inc’s alternatively share class preferred stock either series ii may convertible common stock subsidiary phi group inc’s determined company’s board directors time subsidiary become fullyreporting publicly traded company least three months variable conversion price defined herein variable conversion price used connection conversion common stock subsidiary phi group inc’s shall mean 50 multiplied market price defined herein representing discount rate 50 common stock “market price” means average trading price common stock said subsidiary phi group inc’s ten 10 tradingday period ending one trading day prior date conversion notice sent holder preferred stock company via facsimile email “conversion date” “trading price” means security date closing price otc markets otcqb nasdaq stock markets nyse applicable trading market reported reliable reporting service “reporting service” mutually acceptable company said subsidiary holder class preferred stock” 3 conversion class series iii preferred stock phi group inc common stock american pacific plastics inc subsidiary phi group inc’s entire class series iii preferred stock phi group inc ie fifty million 50000000 shares may convertible eighty percent 80 american pacific plastics inc’s common stock issued outstanding immediately conversion exchange pro rata basis 4 conversion shares amount shares common stock phi group inc alternatively subsidiary phi group inc’s received holder time conversion class series ii preferred stock phi group inc based following formula cs common shares phi group inc amount cs oip aud alternatively subsidiary phi group inc’s vcp oip original issue price class series ii preferred stock phi group inc aud accrued unpaid dividends vcp variable conversion price phi common stock subsidiary phi group inc’s defined iii redemption rights corporation period two years date issuance may time redeem class preferred stock either series ii series iii whole part option company’s board directors price equal one hundred twenty percent 120 original purchase price class preferred stock unit consisting shares class preferred stock warrants attached thereto plus case accumulated unpaid dividends date fixed redemption iv liquidation upon occurrence liquidation event defined holders class preferred stock entitled receive net assets pro rata basis used herein “liquidation event” means liquidation dissolution windingup whether voluntary involuntary corporation ii purchase redemption corporation shares class stock merger consolidation corporation corporations unless holders class preferred stock receive securities surviving corporation substantially similar rights class preferred stock stockholders corporation immediately prior transaction holders least majority voting securities successor corporation immediately thereafter “permitted merger” unless holders shares class preferred stock elect otherwise b sale license lease substantially material part corporation’s assets unless holders class preferred stock elect otherwise v rank shares class preferred stock shall rank senior corporation’s common stock class series capital stock corporation hereafter created ii pari passu class series capital stock corporation hereafter created specifically ranking terms par class preferred stock iii junior class series capital stock corporation hereafter created specifically ranking terms senior class preferred stock case distribution assets upon liquidation dissolution winding corporation whether voluntary involuntary vi voting rights 1 class series ii iii preferred stock phi group inc shall voting rights vii protection provisions long shares class preferred stock outstanding corporation shall without first obtaining majority written consent holders class preferred stock alter change rights preferences privileges class preferred stock affect adversely holders class preferred stock viii miscellaneous status redeemed stock case shares class preferred stock shall redeemed otherwise repurchased reacquired shares redeemed repurchased reacquired shall resume status authorized unissued shares preferred stock shall longer designated class preferred stock b lost stolen certificates upon receipt corporation evidence loss theft destruction mutilation preferred stock certificates ii case loss theft destruction indemnity bond security reasonably satisfactory corporation case mutilation preferred stock certificates surrendered cancellation corporation shall execute deliver new preferred stock certificates however corporation shall obligated reissue lost stolen destroyed mutilated preferred stock certificates holder class preferred stock contemporaneously requests corporation convert holder’s class preferred stock common stock c waiver notwithstanding provision certificate designation contrary provision contained herein right holders class preferred granted hereunder may waived shares class preferred stock holders thereof upon majority written consent holders class preferred stock notices required permitted given terms hereof shall sent certified registered mail return receipt requested delivered personally nationally recognized overnight carrier confirmed facsimile transmission shall effective five 5 days placed mail mailed upon receipt refusal receipt delivered personally nationally recognized overnight carrier confirmed facsimile transmission case addressed party set forth address telephone fax number may designated writing hereafter manner set forth section corporation phi group inc vegas drive 237 las vegas nv 89108 telephone 7024755430 facsimile 7024728556 holders class preferred stock address listed corporation’s books records class b preferred stock class b series preferred stock designation next twentyfive thousand shares previously authorized 100000000 shares preferred stock par value 0001 per share shall class b series preferred stock b number shares number shares class b series preferred stock authorized twentyfive thousand shares c dividend none voting rights except provided law shares class b series preferred stock shall right vote act matters holders common stock right vote act holders shares class b series shall entitled notice stockholders’ meeting action matters basis holders common stock holders common stock shares class b series shall vote together act together thereon single class matters provided voting action one share class b series shall entitled one hundred thousand votes june 30 2018 10000000 shares class series ii preferred stock issued outstanding domestication state wyoming september 20 2017 company applied certificate domestication filed articles domestication office secretary state wyoming redomicile company’s jurisdiction state wyoming september 20 2017 company filed articles amendment wyoming secretary state amend authorized capital company follows “the total number shares authorized capital stock corporation divided one billion shares consisting nine hundred million shares voting common stock par value 0001 per share fifty million shares nonvoting class series preferred stock par value 500 per share twentyfive million shares nonvoting class series ii preferred stock par value 500 per share twenty million shares nonvoting class series iii preferred stock par value 500 per share five million shares voting class series iv preferred stock par value 500 per share relative rights preferences limitations restrictions associated aforementioned shares class preferred stock determined board directors corporation” date report company continues operate nevada corporation note 16 stockbased compensation plans february march 18 2015 company adopted employee benefit plan set aside 1000000 shares common stock eligible employees independent contractors company subsidiaries june 30 2018 company issued stock lieu cash plan september 23 2016 company issued incentive stock options nonqualified stock options certain key employees henry fahman ceocfo directors tam bui henry fahman frank hawkins constitute board directors deferred compensation options allow holders acquire company’s common stock fair exercise price company’s common stock grant date option 024 per share based 10days’ volumeweighted average price prior grant date number options equal total 6520000 options terminate seven years date grant become vested exercisable one year grant date following assumptions used monte carlo analysis doty scott enterprises inc independent valuation firm determine fair value stock options vesting based oneyear cliff grant date annual attrition rates used valuation since ongoing employment condition vesting options fair value company’s stock options issuance valuation date follows note 17 gain loss settlement debts fiscal year ended june 30 2018 loss amount 92780 settlement debts loss amount 94539 conversions debts common stock company note 18 income expense net income expense fiscal year ended june 30 2018 consists following note 19 related party transactions company accrued 210000 salaries president secretary company year ended june 30 2018 year ended june 30 2018 company received 25000 consulting service american laser healthcare inc president company also serves interim chief executive officer note 20 income taxes provision made income tax since company significant net operating loss carry forward june 30 2018 company incurred net operating losses tax purposes approximately 40551299 net operating loss carry forward may used reduce taxable income year 2033 net operating loss carry forwards state california generally available reduce taxable income year 2023 availability company’s net operating loss carryforward subject limitation 50 positive change ownership company’s stock “under section 6501a internal revenue code tax code section 3016501a1a income tax regulations tax regulations irs required assess tax within 3 years tax return filed irs” note 21 contracts commitments equity line facility investment agreement azure capital inc march 6 2017 phi group inc nevada corporation “company” azure capital massachusetts corporation “investor” entered investment agreement “investment agreement” registration rights agreement “registration rights agreement” dated march 6 2017 company investor pursuant investment agreement investor committed purchase subject certain restrictions conditions 10000000 worth company’s common stock period 36 months effectiveness registration statement registering resale shares purchased investor pursuant investment agreement company agreed initially reserve 20000000 shares common stock issuance investor pursuant investment agreement event company cannot register sufficient number shares common stock issuance pursuant investment agreement company use best efforts authorize reserve issuance number shares required company perform obligations connection investment agreement soon reasonable practical company may discretion draw facility time company determines appropriate accordance terms conditions investment agreement maximum number shares company entitled put investor one draw notice shall exceed shares purchase price 250000 200 average daily volume us market company’s common stock three 3 trading days prior applicable put notice date multiplied average three 3 daily closing prices immediately preceding put date calculated accordance investment agreement company may deliver notice subsequent put time pricing period prior put completed purchase price shall set ninetyfour percent 94 lowest daily volume weighted average price vwap company’s common stock five 5 consecutive trading days immediately following put notice date put notice submitted investor company shall specify suspension price put event price company’s common stock falls suspension price put shall temporarily suspended put shall resume time price company’s common stock suspension price provided dates pricing period particular put still valid event pricing period complete shares suspension price due investor shall sold investor company suspension price terms investment agreement suspension price put may changed company submitted investor put restrictions applied days draw notice date closing date respect particular put time company shall entitled deliver another draw notice addition investor obligated purchase shares investor’s total number shares beneficially held time would exceed 499 number shares company’s common stock determined accordance rule 13d1j securities exchange act 1934 amended addition company permitted draw facility unless effective registration statement cover resale shares investment agreement also contains customary representations warranties parties assertions embodied representations warranties made purposes investment agreement subject qualifications limitations agreed parties connection negotiating terms investment agreement investment agreement provides company investor entitled customary indemnification among things losses liabilities may suffer result breach party provisions investment agreement registration rights agreement defined investor read investment agreement together information concerning company publicly files reports statements securities exchange commission “sec” pursuant terms registration rights agreement company obligated file one registrations statements sec within twentyone 21 days date registration rights agreement register resale investor shares common stock issued issuable investment agreement addition company obligated use commercially reasonable efforts registration statement declared effective sec within 90 days registration statement filed investment agreement amended august 3 2017 allow reservation 65445000 shares company’s common stock issuance investor pursuant corrected investment agreement company filed s1 registration statement securities exchange commission include 7936600 shares common stock issuance connection first tranche equity line facility s1 registration statement amended declared effective securities exchange commission january 11 2018 company intends access equity line facility company’s stock prices reach levels management deems appropriate settlement agreement thinh hung investment co august 3 2017 company signed settlement agreement agreed pay thinh hung investment co total amount 381000 includes outstanding balance 288219 reclassified customer advances longterm liability portion attached balance sheet accrued interest agreed two parties according settlement agreement compapny transfer cause transferred least 480000 shares common stock phi group inc authorized represenatative thinh hung event thinh hung unable realize least 381000 sale phi stock phi group either transfer additional common stock phi group inc marketable securities authorized reprenesattive designated thinh hung pay cash directly thinh hung total amount 381000 reached phi group inc agreed use best efforst pay outstanding balance october 31 2017 receipt least 480000 shares phi group stock authorized representative thinh hung thinh hung shall deliver transfer vietnam foods corporation stock phi group inc authorized representative day report company able transfer 480000 shares common stock thinh hung’s authorized representative memorandum understanding aquarius power inc august 9 2017 company signed memorandum understanding “mou” aquarius power inc “aqp” texas company provide renewable energy technology vietnam phi also made investment become strategic shareholder aqp phi aqp form joint venture company exclusive right sublicense sell build andor operate aqp energy systems vietnam exclusive basis phi responsible obtaining necessary approvals build operate aquarius energy system securing binding acceptable power purchase agreement ppa governmental authority providing land aquarius energy system providing construction civil engineering knowhow build energy pools providing management engineering operational manpower build operate aquarius engineering system providing interconnection aquarius energy system national grid aqp’s responsibilities include support phi obtaining power purchase agreement conduct site survey provide blueprints tailor made energy system provide technical support construction operation energy system includes training construction installation operations build ship aquarius energy systems install commission aquarius energy system required aquarius wave energy system landbased wave energy system uses combination gravity “buoyancy” found within interaction air water produce power used generate electricity produce potable water aquarius baseload zero carbon footprint uses consumables installed virtually anywhere planet cost effective fossil fuel alternatives system built turnkey within 6 months obtaining permits operating life 60 years clean scalable reliable extremely flexible operating cost comparably low hydroelectric systems october 6 2017 company signed new memorandum understanding “mou” aquarius power inc expand scope cooperation provide renewable energy technology eastern europe european region eastern europe company process planning build pilot unit romania using aqp technology phi also intends make additional investments aqp date report company made investment 5000 aquarius power inc intends continue making additional investments via purchase aqp’s common stock agreement acquire 51 ownership 400acre mining claims grant county oregon closing transaction september 2 2017 american pacific resources inc wyoming corporation “apr” wholly owned subsidiary company entered agreement purchase sale rush gold royalty inc wyoming corporation acquire 51 ownership twentyone mining claims area approximately 400 acres granite mining district grant county oregon usa transaction closed effective october 3 2017 company paid cash issued 10000000 shares class series ii preferred stock valued 314100 convertible demand promissory note amount 24310400 totaling twentyfive million dollars rush gold royalty inc exchange mining claims june 30 2018 balance convertible demand promissory note 24048500 april 23 2018 company’s board directors passed resolution declare twenty percent 20 special stock dividend holdings common stock american pacific resources inc subsidiary company shareholders common stock company follows declaration date april 23 2018 b record date may 31 2018 c payment date october 31 2018 dividend ratio eligible shareholders common stock company record date shall entitled receive two 2 shares common stock american pacific resources inc every ten 10 shares common stock phi group inc held shareholders referenced record date payment date rescheduled march 29 2019 technical assistance agreement auburn university september 25 2017 company signed technical assistance agreement auburn university conduct research program order determine market segments related supply demand medicinal aromatic plants world focus specifically major production consumption markets first four topics research program focus production medicinal applications market analysis turmeric saffron bitter melon major potential aromatic plants last topic covers trends solutions switching conventional farming organic farming crops meet future food medicinal consumption research program began october 1 2017 ended september 30 2018 agreement develop 67000acre gold mining project laos november 4 2017 american pacific resources inc “apr” httpsaprgoldcom signed business cooperation investment agreement suda lattana co lao company develop 67000acre gold mining project province savannakhet laos according agreement apr responsible financing operating gold mining project share majority project’s net profits accounting costs capital operating expenses estimated 3527000 ounces gold mined concession subject professional study verification agreement valid december 31 2066 date report apr begun project business consulancy structuring agency agreement set institutional bank funds luxembourg november 30 2017 company signed agreement structuring agent legal experts set bank fund luxembourg order provide financing company’s clients’ projects reserved alternative investment fund raif established form common funds “fcp” investment companies variable capital “sicav” form legal form sicav fcp restriction terms eligible assets raifs free introduce kind assets financial instruments investment policy according luxembourg law july 12 2013 raifs must entrust assets luxembourg custodian bank safekeeping must appoint approved statutory auditor one distinctive advantages raif may various subfunds corresponding distinct part assets liabilities raif subfunds established raif umbrella target different investment opportunities variety industries desired february 21 2018 company signed amendment business consultancy structuring agency agreement solely responsible costs euros 3500000 associated establishing raif october 4 2018 payment agreement signed structuring agent company calling extra amount euros 1500000 paid structuring agent november 15 2018 investment agreement gridline communications inc december 15 2017 phi group inc entered investment agreement gridline communications inc “gridline” form special purpose vehicle “spv” name matrix communications inc holding company acquire stock gridline communications sister company gridlinex well finance implement gridline’s highspeed broadband communications business according investment agreement matrix communications acquire ownership rights investee connection highspeed broadband networks related supporting assets serve government commercial consumer telephony data video needs republic equatorial guinea first point entry african continent matrix communications’ authorized capital include 600 million shares common stock 300 million shares preferred stock phi group sole holder common stock spv initially retain fifteen percent equity interest thereof following capitalization plan transaction closed date report memorandum understanding build industrial park greenhouses power plant water park transylvania romania december 18 2017 phi group inc “company” entered memorandum understanding “mou” sc zios srl romanian company develop industrial park transylvania romania according mou phi group cooperate owner sc zios srl develop build operate gasfired power plant greenhouses zios land parcel water park adjacent company committed investing causing invested required capital finance building minimum 10mw gasfired power plant renewable energy steam processing plant building minimum 10hectares greenhouse investing 20 million euros water park health retreat wellness resort taking advantage salt lakes adjacent zios land parcel parties agree accept value zios land parcel equivalent seven 7 million euros acknowledge zios currently debt 14 million euros books owner sc zios srl agrees contribute 35 million euros value zios land parcel toward total capitalization develop build operate gasfired power plant greenhouse water park hold proportionate percentage ownership entity owns projects based total capitalization amount first two years phi group agrees pay cause paid owner sc zios srl two 2 million euros required approvals permits granted pertinent romanian governmental authorities build gasfired power plant greenhouse water park sum money payment 14 million euros zios creditor come structured financing connection capitalization projects unless agreed otherwise pertinent parties afterwards addition balance 15 million euros paid owner sc zios srl period 5 years based cash flow milestones operations date report company sc zios srl signed definitive agreement consummate transactions mentioned herein agreement american pacific resources inc gildexshop february 28 2018 american pacific resources inc “apri” subsidiary company signed business cooperation gildexshop pte ltd “gldx” company established singapore according agreement apri gldx primarily cooperate accomplish following objectives 1 capitalization apri gldx issue circulate certain amount cryptocurrency tokens using blockchain technology order raise capital apri implement business plan 2using apri’s assets guarantee gldx ico’s apri agrees guarantee value gldx ico tokens pursuant following terms conditions event trading prices gldx ico tokens fall original purchase prices anytime gldx tokens listed reputable cryptocurrency exchange apri agrees guarantee value gldx ico tokens purchased investors allowing token holders exchange original purchase prices ico tokens gold apri 50 discount market price defined herein gold time exchange market price shall mean 10day average closing spot price gold london metal exchange lme immediately prior date request exchange ico token holders b holders gldx ico tokens may select one following options receipt apri gold guarantee receipt physical gold bars apri affiliates ii receipt ethereum alternatively acceptable crytocurrencies equivalent value original ico purchase prices iii receipt cash wire transfer tokenholder’s bank account sale guarantee gold positions 3 gldx shall responsible providing required capital apri set processing facilities recover gold precious metals gold assets amounts capital provided apri gldx done tranches based schedule funding use proceeds determined agreed upon apri gldx 4 apri covenants warrants shall sell refined gold products precious metals gold assets gldx 50 discount market price defined gldx recovered least twice amounts capital investment apri end fiveyear term agreement whichever occurs later 5 compliance various jurisdictions requirements us securities exchange commission gldx shall strictly comply requirements appropriate jurisdictions respect offerings gldx ico tokens shall offer tokens us investors unless met requirements us securities exchange commission connection offering sale tokens date report apri received capital gldx agreement phuong hoang investment development llc grow sacha inchi thua thien hue province vietnam march 2018 company signed business cooperation agreement phuong hoang investment development llc company registered ha tinh province vietnam grow total 2000 hectares approximately 4940 acres sacha inchi province thua thien hue export us european markets originally amazon rainforest high andes mountains peru sacha inchi part inca diet 3000 years sacha inchi plant plukenetia volubilis rainforest vine starshaped seed pods currently cultivated primarily parts southeast asia south america sacha inchi recognized number health benefits complete protein weight loss heart health bone health skin hair health according agreement company responsible providing required capital project 75 equity interest joint venture company agreement clientpartner participation luxembourg reserved alternative investment fund march 27 2018 thanh vu individual “tv” signed agreement company participate luxembourg reserved alternative investment fund “raif” according agreement tv pay company 2000000 fees participate raif 500000 due upon signing 1500000 paid fifteen days signing agreement company recorded 2000000 contract assets 1212159 recognized revenue fiscal year ended june 30 2018 thus leaving 697841 remaining contract assets offset 697841 contract liabilities june 30 2018 tv shall entitled benefits connection raif including limited voting rights profit sharing cash securities dividends well benefits related ownership fund joint business cooperation agreement indonesian german companies april 5 2018 company signed joint business cooperation agreement pt mega kencana persada indonesian company principal address 2 jln kepodang raya k9 jakarta selatan 15412 indonesia hereinafter referred “mkp” smartway gmbh company organized existing laws federal republic germany principal address liszstr 17 d53115 bonn germany hereinafter referred “smw” primarily cooperate one develop certain joint business opportunities particularly research development indonesian maritime commuter segment including application smw’s logistical technology optimized interprovincial ferry operations digital online payment system maritime passengers moreover parties may time cooperate jointly engage business activities deem mutually desirable beneficial parties agree mkp shall responsible conducting research development field survey data collection capturing business opportunities securing local government licensing requirements b smw shall provide cause provided system technologies support market segments submitted mkp respect indonesian maritime transportation land transportation online payment indonesian overseas travel c phi shall provide assistance respect financing capitalization investor public relations business development going public corporate governance growth expansion strategy pertinent corporate activities deem beneficial scope business cooperation mentioned herein mkp phi smw agree form singaporean company holding company “holdco” contemplated business activities mentioned herein e roles responsibilities benefits party connection scope business mentioned herein determined holdco business cooperation agreement fintech green investment jsc may 21 2018 company signed business cooperation agreement fintech green investment jsc cooperate respect following areas phi discuss negotiate fgi consider acquisition majority equity interest fgi andor exchange ownership tnb phi way stock swap form strategic alliance two companies b phi invest cause invested fgi assist fgi access funding sources implement fgi’s business plan c phi assist fgi become publicly traded company united states stock market international exchanges deems appropriate enable fgi access international capital markets development growth phi cooperate fgi set additional cryptocurrency mining facilities selective geographical areas assist fgi promote advertise business global basis e phi fgi may jointly develop manufacture market products andor engage business activities may mutual interest parties note 22 going concern uncertainty shown accompanying consolidated financial statements company accumulated deficit 40551299 total stockholders’ deficit 4844747 june 30 2018 factors well uncertain conditions company faces daytoday operations respect cash flows create uncertainty company’s ability continue going concern financial statements include adjustments might necessary company unable continue going concern management taken action strengthen company’s working capital position generate sufficient cash meet operating needs june 30 2019 beyond note 23 subsequent event financial statements approved management available issuance october 12 2018 subsequent events evaluated date business cooperation agreement regent blockhain group ltd july 22 2018 company signed business cooperation agreement regent blockchain group ltd “rbg” filipino company form joint venture company develop operate offshore financial center blockchain businesses including limited apps ico’s cryptocurrency exchanges joint venture company located cagayan economic zone lailo municipality cagayan philippines httpcezagovph rbg phi specifically cooperate respect following areas 1 phi rbg form joint venture company “jv” located cagayan economic zone lailo municipality cagayan philippines purposes developing operating offshore financial center blockchain businesses including limited apps ico’s cryptocurrency exchanges 2 phi initially invest cause invested 4000000 fiftyone percent ownership management rights jv assist jv access funding sources implement business plan initial investment cash stock phi determined parties prior closing definitive agreement mentioned article ii 3 rbg contribute required licenses filipino government particularly cagayan economic zone authority towards jv operations offshore financial center blockchain businesses 4 phi appropriate time spin jv company new public company united states stock market international exchanges deems desirable enable access international capital markets development growth capital structure jv prior spinoff determined parties detailed definitive agreement 5 phi rbg may jointly develop manufacture market products andor engage business activities may mutual interest parties business cooperation agreement bao lam llc grow sacha inchi vietnam central highlands july 2 2018 company signed business cooperation agreement bao lam llc company registered dak lak province vietnam grow total 1000 hectares approximately 2470 areas sacha inchi province dak lak dak nong province vietnam export us european markets according agreement company responsible providing required capital project 75 equity interest joint venture company acquisition 51 equity interest vinafilms joint stock company august 06 2018 signed business cooperation agreement vinafilms jsc công ty cổ phần màng bao bì tân vinh nam phát vietnamese joint stock company principal business address lot g9 road 9 tan industrial zone duc hoa ha village duc hoa district long province vietnam hereinafter referred “vnf” majority shareholder exchange fiftyone percent ownership vnf preferred stock phi according agreement phi responsible filing s1 registration statement securities exchange commission american pacific plastics inc subsidiary phi holds 51 equity ownership vnf become fullyreporting public company us stock market september 20 2018 stock swap agreement signed ms thi nghieu majority shareholder holding 76 ownership vnf phi exchange 3060000 shares ordinary stock vnf owned ms thi nghieu 50 million shares class series iii cumulative convertible redeemable preferred stock phi transaction closed september 28 2018 amendment articles incorporation phi group inc july 25 2018 certificate amendment articles incorporation phi group inc filed nevada secretary state amend article v articles incorporation change authorized capital stock corporation 1500000000 shares par value 0001 per share consisting 1400000000 shares voting common stock par value 0001 per share 100000000 shares preferred stock par value 0001 per share rights terms associated shares preferred stock determined board directors corporation certificate designation class b series preferred stock phi group inc september 21 2018 certificate designation nevada profit corporations filed nevada secretary state designate class b series preferred stock phi group inc follows designation next twentyfive thousand shares previously authorized 100000000 shares preferred stock par value 0001 per share shall class b series preferred stock b number shares number shares class b series preferred stock authorized twentyfive thousand shares c dividend none voting rights except provided law shares class b series preferred stock shall right vote act matters holders common stock right vote act holders shares class b series shall entitled notice stockholders’ meeting action matters basis holders common stock holders common stock shares class b series shall vote together act together thereon single class matters provided voting action one share class b series shall entitled one hundred thousand votes september 21 2018 company issued total fifteen thousand shares class b series preferred stock par value current members company’s board directors amendment articles incorporation phi group inc september 21 2018 certificate amendment articles incorporation phi group inc filed nevada secretary state amend article v articles incorporation change authorized capital stock corporation 2000000000 shares par value 0001 per share consisting 1900000000 shares voting common stock par value 0001 per share 100000000 shares preferred stock par value 0001 per share rights terms associated shares preferred stock determined board directors corporation certificate amendment certificate designation preferred stock phi group inc september 24 2018 certificate amendment certificate designation nevada profit corporations filed nevada secretary state redesignate class preferred stock phi group inc detailed note 15 stockholders’ equity class preferred stock september 28 2018 company issued 50 million shares class series iii cumulative convertible redeemable preferred stock ms thi nghieu connection closing stock swap agreement dated september 20 2018 ms thi nghieu company issuances common stock company july 19 2018 company issued 1951220 shares freetrading common stock phi group inc einstein investments llc holder 115000 convertible promissory note dated november 24 2017 company conversion 1809955 principal amount together 90045 accrued interest note 100000 conversion fees totaling 20000 principal balance due remaining note conversion 5334949 july 19 2018 company issued 1200000 shares freetrading common stock phi group inc power lending group ltd holder convertible promissory note dated january 18 2018 company conversion 1500000 principal amount note principal balance due remaining note conversion 1800000 july 23 2018 company issued 1805607 shares freetrading common stock phi group inc power lending group ltd holder convertible promissory note dated january 18 2018 company conversion 1800000 principal amount note together 132000 accrued interest note totaling 1932000 note paid full issuance conversion shares july 26 2018 company issued 4260531 shares freetrading common stock phi group inc jsj investments inc holder convertible promissory note dated january 18 2018 company conversion 4000000 principal amount note principal balance due remaining note conversion 3875000 july 27 2018 company issued 3356444 shares freetrading common stock phi group inc crown bridge partners llc holder common stock purchase warrant dated october 26 2017 company cashless exercise 1271500 value warrants total warrant value remaining exercise 000 july 30 2018 company issued 2061856 shares freetrading common stock phi group inc power lending group ltd holder convertible promissory note dated january 26 2018 company conversion 2000000 principal amount note principal balance due remaining note conversion 1300000 august 02 2018 company issued 1491667 shares freetrading common stock phi group inc power lending group ltd holder convertible promissory note dated january 26 2018 company conversion 1300000 principal amount note together 132000 accrued interest note totaling 1432000 note paid full issuance conversion shares august 06 2018 company issued 2298851 shares freetrading common stock phi group inc einstein investments llc holder 115000 convertible promissory note dated november 24 2017 company conversion 1420767 principal amount together 29233 accrued interest note 50000 conversion fees totaling 15000 principal balance due remaining note conversion 3914182 august 17 2018 company issued 6971290 shares freetrading common stock phi group inc jsj investments inc holder convertible promissory note dated january 18 2018 company conversion 3875000 principal amount note together 419315 accrued interest principal balance due remaining note conversion 0000 august 23 2018 company issued 2205882 shares freetrading common stock phi group inc power lending group ltd holder convertible promissory note dated february 22 2018 company conversion 1500000 principal amount note principal balance due remaining note conversion 1800000 august 27 2018 company issued 3066667 shares freetrading common stock phi group inc power lending group ltd holder convertible promissory note dated february 22 2018 company conversion 1800000 principal amount note together 132000 accrued interest note totaling 1932000 note paid full issuance conversion shares august 31 2018 company issued 1500000 shares freetrading common stock phi group inc auctus fund llc holder convertible promissory note dated february 02 2018 company conversion 57918 principal balance note together 498082 accrued unpaid interest 50000 conversion fee note totaling 606000 principal balance due remaining note conversion 7442082 august 31 2018 company issued 500000 shares restricted common stock company redchip companies llc 500000 shares restricted common stock company srs consulting ltd consulting services price 001 per share september 06 2018 company issued 1022913 shares freetrading common stock phi group inc adar bays llc holder convertible promissory note dated february 13 2018 company conversion 500000 principal amount note principal balance due remaining note conversion 5500000 september 20 2018 company issued 1734105 shares freetrading common stock phi group inc einstein investments llc holder 115000 convertible promissory note dated november 24 2017 company conversion 651743 principal amount note together 48257 accrued interest note 50000 conversion fees totaling 7500 principal balance due remaining note conversion 3262439 september 21 2018 company issued 1500000 shares freetrading common stock phi group inc auctus fund llc holder convertible promissory note dated february 02 2018 company conversion 411066 principal balance note together 48934 accrued unpaid interest 50000 conversion fee note totaling 510000 principal balance due remaining note conversion 7031016 september 26 2018 company issued 164722 shares restricted common stock company auspices rule 144 andreas held 133425 cash payment issuance new shortterm promissory notes july 05 2018 company received 255000 net proceeds tranche 30000 connection master convertible promissory note issued crown bridge partners llc april 2 2018 interest rate 10 convertible common stock company 50 discount average two lowest trading prices closing bids twenty trading days immediately prior date conversion maturity date note 7052019 july 10 2018 company issued new convertible promissory note power lending group 73000 interest rate 8 convertible common stock company 42 discount average two lowest trading prices closing bids ten trading days immediately prior date conversion prepayment premium 150 maturity date note april 30 2019 july 17 2018 company issued new convertible promissory note auctus fund llc 75000 interest rate 12 convertible common stock company 50 discount average two lowest trading prices twenty five trading days immediately prior date conversion maturity date note july 17 2019 july 23 2018 company issued new convertible promissory note one44 capital llc 90000 interest rate 10 convertible common stock company 45 discount average two lowest trading prices twenty trading days immediately prior date conversion maturity date note july 23 2019 august 06 2018 company issued new convertible promissory note power lending group 38000 interest rate 8 convertible common stock company 42 discount average two lowest trading prices closing bids ten trading days immediately prior date conversion prepayment premium 150 maturity date note may 15 2019 august 30 2018 company issued new convertible promissory note power lending group 73000 interest rate 8 convertible common stock company 42 discount average two lowest trading prices closing bids ten trading days immediately prior date conversion prepayment premium 150 maturity date note june 15 2019 september 20 2018 company received 25000 tam bui director company shortterm loan paid demand interest loan pegged interest rate cash advance american express september 21 2018 company received 75000 tristina lam note face value 80000 secured deed trust realty held president company note due payable november 21 2018 september 25 2018 company issued new convertible promissory note power lending group 38000 interest rate 8 convertible common stock company 42 discount average two lowest trading prices closing bids ten trading days immediately prior date conversion prepayment premium 150 maturity date note july 15 2019 september 26 2018 company issued new convertible promissory note jsj investments inc 144750 interest rate 10 convertible common stock company 50 discount average two lowest trading prices twenty trading days immediately prior date conversion prepayment premium 150 maturity date note 9262019 item 9 item 8 financial statements phi group inc independent auditor’s report board directors stockholders phi group inc formerly providential holdings inc independent auditors’ report audited accompanying consolidated balance sheets phi group inc nevada corporation subsidiary june 30 2014 2013 related consolidated statements operations stockholders’ equity cash flows year ended june 30 2014 2013 consolidated financial statements responsibility company’s management responsibility express opinion consolidated financial statements based audits management’s responsibility financial statements management responsible preparation fair presentation financial statements accordance accounting principles generally accepted united states america includes design implementation maintenance internal control relevant preparation fair presentation financial statements free material misstatement whether due fraud error auditor’s responsibility express opinion financial statements based audits conducted audits accordance standards public company auditing oversight board standards require plan perform audit obtain reasonable assurance whether financial statements free material misstatement audit involves performing procedures obtain audit evidence amounts disclosures financial statements procedures selected depend auditor’s judgment including assessment risks material misstatement financial statements whether due fraud error making risk assessments auditor considers internal control relevant entity’s preparation fair presentation financial statements order design audit procedures appropriate circumstances purpose expressing opinion effectiveness entity’s internal control accordingly express opinion audit also includes evaluating appropriateness accounting policies used reasonableness significant accounting estimates made management well evaluating overall presentation financial statements believe audit evidence obtained sufficient appropriate provide basis audit opinion consolidated financial statements referred present fairly material respects consolidated financial position phi group inc subsidiary june 30 2014 2013 results consolidated operations cash flows year ended june 30 2014 2013 conformity accounting principles generally accepted united states america company’s financial statements prepared using generally accepted accounting principles applicable going concern contemplates realization assets liquidation liabilities normal course business company accumulated deficit 36954987 negative cash flow operations amounting 255994 year ended june 30 2014 factors discussed note 21 consolidated financial statements raise substantial doubt company’s ability continue going concern management’s plans regard matters also described note 21 consolidated financial statements include adjustments might result outcome uncertainties dave banerjee cpa dave banerjee cpa accountancy corp woodland hills california december 24 2014 phi group inc subsidiaries consolidated balance sheets audited accompanying notes form integral part audited consolidated financial statements phi group inc subsidiaries consolidated statement operations years ended june 30 2014 2013 audited accompanying notes form integral part audited consolidated financial statements phi group inc subsidiaries statement stockholders’ equity deficit years ended june 30 2014 2013 audited accompanying notes form integral part audited consolidated financial statements phi group inc subsidiaries consolidated statements cash flows years ended june 30 2014 2013 audited accompanying notes form integral part audited consolidated financial statements phi group inc subsidiaries formerly providential holdings inc notes consolidated financial statements note 1 nature business established june 1982 phi group inc “company” “phi” nevada corporation primarily engaged energy natural resources company acquires consolidates energyrelated assets natural resources partners international companies develop independent power plant projects southeast asia collaborates certain us companies provide renewable energy solutions using wind solar power biomass new technological developments company also provides corporate finance services including merger acquisition advisory consulting services arranges capital energyrelated natural resource infrastructure projects wholly owned subsidiary phi capital holdings inc addition company also participates international trade activity company originally incorporated laws state nevada june 1982 name jr consulting inc initially engaged mergers acquisitions operating subsidiary diva entertainment inc operated two modeling agencies one new york one california following business combination providential securities inc californiabased brokerage firm late 1999 company changed name providential securities inc nevada january 2000 company changed name providential holdings inc february 2000 october 2000 providential securities withdrew securities brokerage membership ceased financial services business subsequently april 2009 company changed name phi group inc october 2000 october 2011 company engaged mergers acquisitions advisory consulting services real estate hospitality development mining oil gas telecommunications technology healthcare private equity special situations since october 2011 company begun discontinue operations providential vietnam ltd philand ranch limited together subsidiaries philand corporation philand vietnam ltd phi gold corporation formerly phi mining corporation phi energy corporation mainly focused energy natural resources including investing andor developing coal assets international trade independent power plant projects renewable energy industrial minerals phi capital holdings inc company’s wholly owned subsidiary continues provide corporate project finance services including merger acquisition advisory consulting services companies variety industries arranging capital energyrelated natural resource infrastructure projects assurances made company successful achieving plan note 2 summary significant accounting policies principles consolidation consolidated financial statements include accounts phi group inc wholly owned subsidiary phi capital holdings inc discontinued operations providential securities inc phi energy corporation phi gold corp providential vietnam ltd philand ranch limited including 100 owned subsidiary philand corporation philand vietnam ltd collectively referred “company” significant intercompany transactions eliminated consolidation provimex inc touchlink communications inactive use estimates preparation consolidated financial statements conformity accounting principles generally accepted united states america requires management make estimates assumptions affect reported amounts assets liabilities disclosure contingent assets liabilities date financial statements reported amounts revenues expenses reporting period actual results could differ estimates cash equivalents company considers liquid investments maturity three months less date purchase readily convertible cash equivalents marketable securities company’s securities classified availableforsale carried fair value securities classified availableforsale may sold response changes interest rates liquidity needs purposes investment marketable securities represents less twenty percent 20 outstanding common stock equivalents investee security nationally quoted finra’s otc bulletin board “otcbb” otc markets investment accounted accordance provisions asc 320 previously sfas 115 unrealized holding gains losses availableforsale securities excluded earnings reported separate component stockholder’s equity realized gains losses securities classified availableforsale reported earnings based upon adjusted cost specific security sold june 30 2014 2013 marketable securities recorded 261360 207703 respectively based upon fair value marketable securities time accounts receivable management reviews composition accounts receivable analyzes historical bad debts june 30 2014 company accounts receivable impairment longlived assets effective january 1 2002 company adopted asc 350 previously sfas 144 ”accounting impairment disposal longlived assets” addresses financial accounting reporting impairment disposal longlived assets supersedes sfas 121 “accounting impairment longlived assets longlived assets disposed of” accounting reporting provisions apb opinion 30 ”reporting results operations disposal segment business” company periodically evaluates carrying value longlived assets held used accordance asc 350 asc 350 requires impairment losses recorded longlived assets used operations indicators impairment present undiscounted cash flows estimated generated assets less assets’ carrying amounts event loss recognized based amount carrying amount exceeds fair market value longlived assets loss longlived assets disposed determined similar manner except fair market values reduced cost disposal property equipment property equipment stated cost maintenance repair costs charged expense incurred costs major additions betterments capitalized property equipment sold otherwise disposed cost related accumulated depreciation eliminated accounts resulting gain loss reflected income depreciation computed using straightline method estimated useful lives assets ranging three ten years depreciation amortization cost property equipment depreciated estimated useful lives related assets depreciation amortization fixed assets computed straightline basis net earnings loss per share company adopted provisions asc 260 previously sfas 128 asc 260 eliminates presentation primary fully diluted earnings per share “eps” requires presentation basic diluted eps basic eps computed dividing income loss available common stockholders weightedaverage number common shares outstanding period diluted eps based weightedaverage number shares common stock outstanding period common stock equivalents outstanding end period net earnings loss per share computed follows stockbased compensation effective july 1 2006 company adopted asc 7181025 previously sfas 123r accordingly adopted modified prospective application method asc 7181025 applied new awards modified repurchased cancelled effective date additionally compensation cost portion awards outstanding date adoption requisite service rendered unvested options recognized period time remaining requisite services rendered fair value financial instruments effective july 1 2008 company adopted asc 820 previously sfas 157 fair value measurements adopted statement assets liabilities shown table asc 820 clarifies definition fair value prescribes methods measuring fair value establishes fair value hierarchy based inputs used measure fair value expands disclosures use fair value measurements adoption asc 820 material impact fair value measurements asc 820 permits company defer recognition measurement nonfinancial assets nonfinancial liabilities january 1 2010 june 30 2014 company nonfinancial assets nonfinancial liabilities recognized disclosed fair value asc 820 requires financial assets liabilities reported fair value categorized one following types investments based upon methodology determining fair value level 1 quoted prices active markets identical assets liabilities level 2 observable inputs level 1 prices quoted prices similar assets liabilities quoted prices markets active inputs observable corroborated observable market data substantially full term assets liabilities level 3 unobservable inputs supported little market activity significant fair value assets liabilities company utilizes various approaches measure fair value availableforsale securities assets measured fair value recurring basis summarized company financial liabilities measured fair value recurring basis availableforsale securities company uses various approaches measure fair value availableforsale securities applying threelevel valuation hierarchy disclosures specified asc 820 level 1 securities measured using quoted prices active markets identical assets liabilities company’s policy regarding transfers andor level 3 depends trading activity security volatility security observable units clearly represents fair value security level 3 security measured using fairly represented fair value transfer securities either level 1 level 2 depending type inputs revenue recognition company’s revenue recognition policies compliance asc 13 previously staff accounting bulletin sab 104 company recognizes consulting advisory fee revenues transaction completed service fees earned expenses recognized period corresponding liability incurred payments received relevant criteria revenue recognition recorded unearned revenue advertising company expenses advertising costs incurred advertising costs years ended june 30 2014 2013 5195 4477 respectively comprehensive income loss asc 2201045 previously sfas 130 reporting comprehensive income establishes standards reporting display comprehensive income components accumulated balances comprehensive income defined include changes equity except resulting investments owners distributions owners among disclosures sfas 130 requires items required recognized current accounting standards components comprehensive income reported financial statement displayed prominence financial statements june 30 2014 2013 respectively accumulated comprehensive loss 709183 696995 presented accompanying consolidated balance sheets income taxes company accounts income taxes accordance asc 740 previously sfas 109 “accounting income taxes” deferred taxes provided liability method whereby deferred tax assets recognized deductible temporary differences deferred tax liabilities recognized taxable temporary differences temporary differences reported amounts assets liabilities tax bases deferred tax assets reduced valuation allowance opinion management likely portion deferred tax assets realized deferred tax assets liabilities adjusted effects changes tax laws rates date enactment reporting segments asc 280 previously statement financial accounting standards 131 disclosures segments enterprise related information supersedes statement financial accounting standards 14 financial reporting segments business enterprise establishes standards way public enterprises report information operating segments annual financial statements requires reporting selected information operating segments interim financial statements regarding products services geographic areas major customers asc 280 defines operating segments components enterprise separate financial information available evaluated regularly chief operating decision maker deciding allocate resources assessing performance company operated one segment generated revenues years ended june 30 2014 2013 risks uncertainties normal course business company subject certain risks uncertainties company provides service receives marketable securities upon execution transactions consequently value securities received customers affected economic fluctuations customer’s business growth actual realized value securities could significantly different recorded value recent accounting pronouncements update 201311income taxes topic 740 presentation unrecognized tax benefit net operating loss carryforward similar tax loss tax credit carryforward exists consensus fasb emerging issues task force download july effective fiscal years interim periods within years beginning december 15 2013 nonpublic entities amendments effective fiscal years interim periods within years beginning december 15 2014 early adoption permitted update 201309fair value measurement topic 820 deferral effective date certain disclosures nonpublic employee benefit plans update 201104 download july deferral amendment effective upon issuance financial statements issued update 201307presentation financial statements topic 205 liquidation basis accounting download april effective entities determine liquidation imminent annual reporting periods beginning december 15 2013 early adoption permitted update 201304liabilities topic 405 obligations resulting joint several liability arrangements total amount obligation fixed reporting date consensus fasb emerging issues task force download february effective fiscal years interim periods within years beginning december 15 2013 nonpublic entities amendments effective fiscal years ending december 15 2014 interim periods annual periods thereafter update 201302comprehensive income topic 220 reporting amounts reclassified accumulated comprehensive income download february public entities amendments effective prospectively reporting periods beginning december 15 2012 nonpublic entities amendments effective prospectively reporting periods beginning december 15 2013 early adoption permitted update 201301balance sheet topic 210 clarifying scope disclosures offsetting assets liabilities download january entity required apply amendments fiscal years beginning january 1 2013 interim periods within annual periods entity provide required disclosures retrospectively comparative periods presented effective date effective date update 201111 company either evaluated currently evaluating implications pronouncements possible impact may company’s financial statements cases management determined pronouncement either limited application company cases implementation would material impact financial statements taken whole note 3 loans receivable related parties loans receivable related parties consist following june 30 2014 2013 note 4 assets comprise following june 30 2014 2013 reclassifying “other receivable” “other assets” instead “other current assets” fiscal year ended june 30 2011 philand vietnam ltd wholly owned subsidiary philand ranch ltd made security deposit amount 172203 chu lai open economic zone authority quang nam province vietnam guarantee pointe91 development project bien rang chu lai nui thanh district quang nam province vietnam amount later transferred ky ha chu lai investment development llc “khclidc” deposit clearing land resettlement residents pointe91 project area result discontinuance pointe91 development project company entitled receive refund deposit amount less expenses incurred connection land clearing resettlement activity recorded amount receivable philand vietnam ltd received repayments khclidc totaling approximately 99160 still carries 73043 receivable discontinued operations june 30 2014 year ended june 30 2011 company signed consulting agreement assist agent155 media corp delaware corporation respect corporate restructuring business combination freshwater technologies inc nevada corporation part restructuring requirements company made payment manning elliot llp amount 24476 behalf freshwater technologies inc loan amounts agent155 media corp june 30 2014 president agent155 media corp assumed balance 66955 agent155 media corp personal obligations company january 10 2013 company issued 3288443 shares restricted common stock deposit towards total purchase price 70 equity interest pt tambang sekarsa adadaya recorded value shares par total 3288 june 30 2014 amounts owed chu lai open economic zone authority president agent155 media corp par value deposit shares pt tambang sekarsa adadaya collectively reported assets totaling 143286 note 5 marketable equity securities available sale company’s marketable securities classified availableforsale carried fair value securities comprised shares common stock investee securities classified availableforsale may sold response changes interest rates liquidity needs purposes investment marketable securities represents less twenty percent 20 outstanding common stock equivalents investee security nationally quoted national association securities dealers otc bulletin board “otcbb” pink sheets investment accounted accordance provisions sfas 115 marketable securities classified available sale consisted 2331500 shares vietnam mining corporation kna vanguard mining corporation public company traded otc markets trading symbol vnmc 17396083 shares agent155 media corp trading symbol agmc quarter ended june 30 2014 company purchased 700000 shares common stock vanguard mining corporation nonaffiliate third party total purchase price 91000 company also paid total 115000 shares vanguard mining corp common stock certain creditors lieu cash april 2014 fair value marketable securities recorded june 30 2014 261360 note 6 property equipment june 30 2014 june 30 2013 company property equipment note 7 discontinued operations company decided recognize businesses phi gold corp formerly phi mining corporation providential vietnam ltd phi energy corp philand ranch ltd united kingdom corporation together whollyowned subsidiaries philand corporation usa philand ranch ltd singapore philand vietnam ltd discontinued operations june 30 2012 practical business accounting purposes company recorded total 2234327 liabilities potential liability contingencies written nonperforming assets associated discontinued operations accompanying consolidated financial statements june 30 2013 june 30 2014 company balance 1046632 liabilities discontinued operations note 8 accounts payable accrued expenses accounts payable accrued expenses june 30 2014 2013 consist following note 9 due officer due officer represents advances made officers company subsidiaries noninterest bearing except 100000 described unsecured due demand june 30 2014 2013 balances 1858402 1444598 respectively june 30 2014 company short term note payable amounting 100000 interest bearing 3000 per month payable member board directors note 10 loans promissory notes short term notes payable june 30 2014 june 30 2013 company shortterm notes payable amounting 1346721 1426456 accrued interest 2874509 2952261 respectively notes bear interest rates ranging 6 36 per annum notes payable secured assets company summarized convertible promissory note last convertible promissory note issued asher enterprises inc “asher” june 17 2011 42500 interest 8 per annum due payable march 21 2012 note convertible election asher time issuance date 39 discount average lowest closing bid prices company’s common stock ten trading day period ending latest complete trading prior conversion date event default amount principal interest paid due bear interest rate 22 per annum note becomes immediately due payable occur company liable pay asher 150 outstanding principal interest note agreements contain covenants requiring asher’s written consent certain activities existence committed company issue date note outstanding note principal interest amounts accrued thereon converted whole part time asher issuance date equivalent company’s common stock determined discount rate mentioned note additionally note contains reset provision exercise price conversion price company issues equity derivatives price less exercise price set forth warrants note ratchet provision results derivative liability financial statements july 25 2011 10000 principal convertible note issued january 11 2011 converted equivalent 1550 shares postsplit common stock company 2325581presplit shares august 8 2011 12000 principal convertible note issued january 11 2011 converted equivalent 1633 shares postsplit common stock company 2448980 presplit shares august 30 2011 15000 principal convertible note issued january 11 2011 converted equivalent 2941 shares postsplit common stock company 4411765 presplit shares october 21 2011 8000 principal convertible note issued january 11 2011 converted equivalent 2667 shares postsplit common stock company 4000000 presplit shares november 22 2011 10000 principal convertible note issued january 11 2011 converted equivalent 5083 shares postsplit common stock company 7625000 presplit shares january 03 2012 10000 principal convertible note issued june 17 2011 converted equivalent 4444 shares postsplit common stock company 6666667 presplit shares january 11 2012 11000 principal convertible note issued june 17 2011 converted equivalent 5641 shares postsplit common stock company 8461538 presplit shares march 1 2012 12000 principal convertible note issued june 17 2011 converted equivalent 5741 shares postsplit common stock company 8571429 presplit shares april 23 2012 asher enterprises inc converted 7000 principal amount convertible note dated june 17 2011 8197 shares postsplit common stock company price 0854 per share june 30 2014 total outstanding balance amount due asher enterprises inc 3750 due preferred stockholders company classified 215000 preferred stock subscribed current liability payable holders preferred stock previously discontinued subsidiary company due deficiency compliance preferred shares subscription agreement connection referenced subsidiary year 2000 company made offer preferred stock holders receive shares common stock company exchange preferred shares far small number preferred shareholders accepted offer interest expenses payable holders preferred stock 361655 335855 included accrued interest included account payable accrued expenses balance sheets june 30 2014 june 30 2013 respectively advances customers previously classified unearned revenue september 30 2012 company decided reclassify previously recorded unearned revenues advances customers company able complete consulting services related clients due inability provide gaapcompliant audited financial statements order file registration statement securities exchange commission june 30 2014 company recorded 563219 advances customers note 11 litigation legal proceeding settled unpaid june 30 2014 quang van cao nhan thi nguyen cao vs providential securities inc et al case originally submitted orange county superior court ca june 25 1997 case 781121 subsequently moved nasd dispute resolution arbitration august 24 2000 company’s legal counsel negotiated claimant’s counsel unilaterally reached settlement approved company process renegotiating terms said settlement claimants filed request arbitration hearing national association securities dealers october 4 2000 case 9903160 thereafter claimants filed complaint orange county superior court ca october 31 2000 case 00cc13067 alleged breach contract damages sum 75000 plus prejudgment interest costs incurred connection complaint relief without admitting denying allegations company reached settlement agreement claimants whereby company would pay claimants total 62500 plus 4500 administrative costs date report company paid 2500 subject entry judgment 79000 may 2011 claimants filed application renewal judgment total 14049078 amount accrued accompanying consolidated financial statements william davidson vs doan et al february 01 2010 company notified suit filed superior court state california county los angeles november 24 2009 william h davidson individual martin doan henry fahman benjamin tran hrciti corporation providential capital inc subsidiary company nka phi capital holdings inc collectively referred “defendants case bc 426831 plaintiff demanded amount less 14000000 defendants promissory notes outstanding plaintiff company july 09 2012 william davidson phi capital holdings inc reached settlement agreement whereby phi capital agreed pay william davidson total 200000 period nineteen months beginning september 1 2012 william davidson elected convert portion total amount common stock phi group inc lieu cash payment addition company paid william davidson 100000 shares vietnam mining corporation company accrued liabilities associated promissory notes accompanying consolidated financial statements june 30 2014 note 12 payroll liabilities payroll liabilities accrued recorded accrued expenses consolidated balance sheet quarter ended june 30 2014 company paid 4197422 internal revenue service 1928994 state california employment development department towards balance 118399 payroll tax penalties interest claimed agencies company currently working internal revenue service state california employment department resolve remaining balance note 13 basic diluted net loss per share net loss per share calculated accordance sfas 128 “earnings per share” provision sfas 128 basic net loss per share computed dividing net loss period weightedaverage number common shares outstanding period diluted eps based weightedaverage number shares common stock outstanding period common stock equivalents outstanding end period basic diluted weighted average numbers shares year ended june 30 2014 since inclusion common stock equivalents antidilutive note 14 stockholder’s equity total number authorized capital stock company 400000000 shares par value 0001 per share consisting 300000000 shares voting common stock par value 0001 per share 100000000 shares preferred stock par value 0001 per share rights terms associated preferred stock determined board directors company march 15 2012 company effectuated 1 1500 reverse split company’s common stock treasury stock balance treasury stock june 30 2014 2987 postsplit shares valued 3801 common stock july 19 2012 officer company converted total 307000 debts owed company 1196424 shares phi group inc’s restricted common stock july 31 2012 seven creditors company converted total 17733333 debts owed company 504865 shares phi group inc’s common stock november 19 2012 company reserved 5673327 shares common stock special dividend distribution november 30 2012 four creditors company converted total 22007906 debts owed company 81737 shares phi group inc’s common stock january 10 2013 company issued 3288443 shares phi group inc’s common stock registered name majority shareholder pt tambang sekarsa adadaya deposit towards total purchase price 70 equity interest pt tambang sekarsa adadaya february 14 2013 two creditors company converted total 150000 debts owed company 155885 shares phi group inc’s common stock february 22 2013 company issued 44763 shares phi group inc’s common stock valued 50000 indonesian attorney payment legal services connection purchase pt tambang sekarsa adadaya february 22 2013 creditor company converted total 33633 debts owed company 44844 shares phi group inc’s common stock april 11 2013 creditor company converted 50000 owed company 76540 shares phi group inc’s common stock april 26 2013 three creditors company converted total 180000 debts owed company 304913 shares phi group inc’s common stock may 10 2013 company issued 100887 shares restricted common stock 40000 cash rule 144 working capital july 1 2013 three creditors company converted total 177940 principal interest owed company 412569 shares common stock phi group inc february 11 2014 creditor company converted total 156750 debts owed company 337097 shares phi group inc’s common stock june 30 2014 6729656 postsplit shares company’s 0001 par value common stock issued outstanding excluding 5673327 shares reserved special dividend distribution 7485 shares reserved potential conversion debt creditor december 8 2014 12503554 postsplit shares company’s 0001 par value common stock issued outstanding including 5673327 shares reserved special dividend distribution 7485 shares reserved potential conversion debt creditor preferred stock preferred stock issued outstanding note 15 gain settlement debts fiscal year ended june 30 2014 company recorded total gain 372278 settlement debts amount included 77925 interest forgiven loans dating back far may 3 2002 237668 interest settled pursuant settlement agreement dated july 9 2012 william h davison company 56685 principal forgiven loans dating back far may 3 2002 consideration required connection amounts forgiven andor settled note 16 related party transactions company accrued 210000 salaries henry fahman president company tina phan secretary company years ended june 30 2014 june 30 2013 note 17 income taxes provision made income tax since company significant net operating loss carry forward june 30 2014 company incurred net operating losses tax purposes approximately 36699000 net operating loss carry forward may used reduce taxable income year 2031 net operating loss carry forwards state california generally available reduce taxable income year 2021 availability company’s net operating loss carryforward subject limitation 50 positive change ownership company’s stock see note 2 “under section 6501a internal revenue code tax code section 3016501a1a income tax regulations tax regulations irs required assess tax within 3 years tax return filed irs company’s 2011 2012 2013 tax return open may subject examination taxing authorities” note 18 contracts commitments business financial consulting agreement thinh hung investment co effective may 21 2010 company signed agreement thinh hung investment co ltd vietnambased company assist thinh hung identifying locating possibly acquiring various business opportunities thinh co ltd subsidiary thinh hung including limited reverse merger stock swap business combination thinh publiclytraded company us exchange services rendered company would receive compensation cash thinh hung common stock combined company september 30 2011 company completed stock purchase investment agreement thinh anh co ltd vietnam foods corporation nevada corporation however combined company filed registration statement securities exchange commission become reporting company recognized 26656 revenues transaction balance 293219 booked customer advances liability portion balance sheet corporate combination agreement provimex inc hpita jsc june 19 2012 provimex inc changed name hpita corporation july 20 2012 hpita corporation “hpus” signed corporate combination agreement acquire issued outstanding stock hpita joint stock company organized existing laws vietnam exchange solely amount authorized unissued common stock hpus equal 95 issued outstanding shares hpus’s common stock immediately following issuance shares hpus intends complete required financial audits file form 10 registration statement securities exchange commission become separate fully reporting publicly traded company us date report hpus filed registration statement securities exchange commission agreement global development systems inc august 11 2012 company signed business cooperation agreement global development systems inc texas corporation market renewable energy electricity generation using global development systems inc’s proprietary hydromagnetic gravitational renewable energy technologies term agreement two years office rental agreements august 11 2012 company signed agreement rent business center office las vegas nevada approximately 100 per month plus administrative expenses oneyear term rental agreement expired august 31 2013 renewed another twelvemonth term august 31 2014 agreement makani power inc august 16 2012 company signed business cooperation agreement makani power inc delaware corporation market renewable energy electricity generation system using makani power’s proprietary airborne wind turbine technology term agreement two years agreement happenex holding bv december 22 2012 company signed business cooperation agreement happenex holding bv dutch corporation cooperate international trade coal natural resource commodities term agreement two years agreement purchase sale pt tambang sekarsa adadaya december 24 2012 company signed agreement purchase sale pt tambang sekarsa adadaya “tsa” indonesian limited liability company holders minimum seventy percent 70 equity ownership tsa acquire seventy percent 70 equity interest tsa exchange total purchase price ten million five hundred thousand us dollars us 10500000 cash stock company tsa currently owns two coal concessions together operation production licenses izin usaha pertambangan operasi produksi pertinent licenses permits covering total area 9690 hectares purportedly containing approximately 205 million metric tonnes indicative coal resources kecamatan baras sarudu kabupaten mamuju utara propinsi sulawesi barat indonesia january 10 2013 company issued 3288443 shares common stock phi group inc deposit towards total purchase price march 16 2013 company signed amendment tsa majority shareholder tsa extend closing date transaction june 30 2013 company engaged pt runge indonesia subsidiary rungepincockminarco australian company conduct independent technical due diligence tsa coal concessions esp law firm indonesia legal firm conduct legal due diligence tsa since technical legal financial due diligence results incomplete extension date transaction terminated june 30 2013 however company tsa recently continued renegotiate terms conditions revised transaction agreement hpita jsc january 11 2013 company signed business cooperation agreement hpita joint stock company organized existing laws vietnam participate international trade base precious metals crossborder financial intermediation term agreement two years business financial consulting agreement january 16 2013 phi capital holdings inc subsidiary company signed consulting agreement hpi company organized existing laws vietnam provide business consulting services hpi term agreement six months fee compensation one hundred thousand us dollars june 30 2014 phi capital holdings completed services consulting agreement received compensation agreement esp law firm january 25 2013 company signed agreement retain esp law firm indonesian advocate legal consultant firm conduct legal due diligence behalf company connection pt tambang sekarsa adadaya acquisition company agreed pay esp law firm 10000 cash 50000 restricted common stock phi group inc’s legal services related contemplated acquisition agreement colebrand international ltd january 28 2013 company signed business cooperation agreement colebrand international ltd company organized existing laws united kingdom cooperate international trade financial intermediation term agreement two years agreement pt runge indonesia february 6 2013 company signed agreement retain pt runge indonesia subsidiary rungepincockminarco australian company provide technical assistance company developing potential jorc resources reserves statement open cut coal deposit pt tambang sekarsa adadaya’s concessions located sulawesi barat indonesia according agreement pt runge indonesia conduct technical due diligence several stages order provide estimate resources reserves compliant jorc code company invoiced work progresses agreement paca february 25 2013 phi capital holdings inc subsidiary company signed consultingengagement agreement paca new york corporation contemplate raising capital purpose financing phi group inc’s business plan including acquisition various energy properties general working capital term engagement two years paca entitled cash success fee equity success fee successful financing transaction agreement purchase sale pt harjo mas makmur march 16 2013 company signed agreement purchase sale pt harjo mas makmur “hmm” indonesian limited liability company holders minimum ninetyfive percent 95 equity ownership hmm acquire ninetyfive percent 95 equity interest hmm exchange total purchase price eight million five hundred fifty thousand us dollars us 8550000 cash stock company hmm currently owns producing coal concession operation production licenses izin usaha pertambangan operasi produksi pertinent licenses permits covering total area 745 hectares kelurahan mentawir kecamatan sepaku kabupaten penajam paser utara propinsi kalimantan timur indonesia together production support transportation facilities june 16 2013 company decided pursue transaction due unsatisfactory due diligence results termination business cooperation agreement global sun wind power corp business cooperation agreement global sun wind power corp expired one year april 26 2013 parties chose renew agreement indonesian office rental agreement may 7 2013 company signed agreement pt karya central bisnis indonesian company rent business center office pondok indah south jakarta indonesia term agreement one year expired may 2014 agreement pt raksasa metal agung june 29 2013 company signed business cooperation agreement pt raksasa metal agung “agung” indonesian company codevelop gold mining projects central java indonesia subsequently agung company signed two addenda business cooperation agreement dated october 7 2013 january 29 2014 respectively set forth capital requirements gold mining projects profit sharing agreement according addenda company entitled 60 agung 40 net profits derived operations second addendum also allows company right assign responsibilities benefits connection business cooperation agreement vietnam mining corporation nka vanguard mining corporation “vnmc” nevada corporation another entity april 29 2014 company signed assignment agreement assign convey transfer rights interests obligations connection said business cooperation agreement addenda vnmc part said assignment agreement company also committed arranging required capital vnmc codevelop gold mining opportunities central java indonesia agung vnmc agreed issue two million shares 0001 par value common stock company consideration said assignment agreement pacific energy network august 16 2013 company signed business cooperation agreement pacific energy network inc washington corporation cooperate develop implement conventional renewable energy business projects geographical areas terms conditions mutually acceptable parties term agreement two years withdrawal pointe91 hospitality development project philand ranch ltd september 20 2013 philand vietnam limited whollyowned subsidiary philand corporation submitted request chu lai open economic zone authority “cloeza” quang nam province voluntarily withdraw pointe91 hospitality development project tam quang village nui thanh district quang nam province surrender investment license due changed market conditions meeting held october 28 2013 among cloeza ky ha chu lai investment development company “khclidc” philand vietnam ltd cloeza agreed philand vietnam ltd’s request termination pointe91 development project instructed appropriate cloeza departments khclidc return unspent deposits philand vietnam ltd assist termination process november 2013 khclidc philand vietnam ltd signed settlement agreement terminate previously executed land clearance compensation agreement two companies agreed khclidc would return vnd 2705349242 deposit amount philand vietnam ltd june 30 2014 company still recorded 73043 receivable chu lai open economic zone authority agreement vinabenny energy joint stock company november 12 2013 company signed business cooperation investment agreement vinabenny joint stock company vietnamese company cooperate codevelop invest cause invested implement operate 84000 mt lpg terminal project giuoc district long province vietnam parties agree roles responsibilities benefits party connection terminal project separate subsequent agreement term agreement one year agreement ne nord energy joint stock company november 14 2013 company signed business cooperation investment agreement ne nord energy joint stock company vietnamese company cooperate codevelop invest cause invested produce market sell led lighting solar energy kinetic power supply system renewable energy energyrelated products services geographical areas markets deem economically beneficial parties term agreement two years business financial consulting agreement asia green corp january 17 2014 phi capital holdings inc whollyowned subsidiary company signed business financial consulting agreement asia green llc “asia green vn” vietnamese company engaged afforestation reforestation projects vietnam assist asia green becoming fully reporting publicly traded company united states arranging capital asia green execute business plan phi capital holdings entitled receive six hundred twenty thousand us dollars compensation services rendered term agreement one year asia green become fully reporting public company april 4 2014 touchlink communications inc nevada corporation majorityowned subsidiary company changed name asia green corporation entered corporate combination agreement asia green vn become holding company asia green vn’s agroforestry afforestation business july 28 2014 asia green corporation changed name omni resources inc pursue new business stock purchase agreements common stock vietnam mining corporation january 24 2014 company signed stock purchase agreements acquire total fourteen million shares common stock vietnam mining corporation “vnmc” nevada corporation two individuals total purchase price 14117500 closing transactions scheduled occur twentieth business day following vnmc’s regaining current good standing status state nevada otc markets transfer agents depository trust corporation pertinent entities june 27 2014 company made partial payment amount 20000 towards purchase price 8750000 shares stock purchase agreements subsequently terminated november 1 2014 consulting engagement agreement vietnam mining corporation nka vanguard mining corporation january 24 2014 phi capital holdings inc whollyowned subsidiary company signed consulting engagement agreement vietnam mining corporation “vnmc” nevada corporation assist vnmc regain current good standing status pertinent regulatory agencies united states certain private service providers seek new business opportunities vnmc phi capital holdings entitled receive four million shares restricted common stock vnmc pursuant provisions rule 144 compensation services rendered term agreement six months date report phi capital holdings received stock compensation vnmc memorandum understanding pt bumi permata indonesia january 29 2014 company signed memorandum understanding “mou” pt bumi permata indonesia indonesian company codevelop 199hectare coal concession kecamatan rantau pandan kabupaten bungo provinsi jambi indonesia parties agree sign definitive agreement containing representations warranties covenants indemnities customary transaction time within 30 days following date mou date report company signed definitive agreement pt bumi permata indonesia intends renegotiate extend transaction adequate due diligence conducted memorandum understanding pt cendrawasih international january 29 2014 company signed memorandum understanding “mou” pt cendrawasih international indonesian company codevelop 8100hectare gold concession kecamatan kotannopan tambangan kabupaten mandailing natal sumatra utara indonesia estimated amount gold deposits concession area 400000 1000000 ounces subject independent verification parties agree sign definitive agreement containing representations warranties covenants indemnities customary transaction time within 30 days following date mou also allows company right assign responsibilities benefits connection project vietnam mining corporation nevada corporation another entity april 29 2014 company signed assignment agreement assign convey transfer rights interests obligations connection said mou vnmc part said assignment agreement company also committed arranging required capital vnmc codevelop 8100hectare gold concession pt cendrawasih international vnmc agreed issue three million shares 0001 par value common stock company consideration said assignment agreement date report company received stock compensation vnmc memorandum understanding cv sindo makmur coal mining january 31 2014 company signed memorandum understanding “mou” cv sindo makmur coal mining indonesian company codevelop operate various coal metal concessions indonesia particularly 100hectare coal concession dondang kecamatan muara jawa kabupaten kutai kartanegara east kalimantan 11960hectare coal concession bukit pinang kecamatan samarinda ulu kota samarinda east kalimantan indonesia parties agree sign definitive agreement containing representations warranties covenants indemnities customary transaction time within 30 days following date mou date report company entered definitive agreement transaction intends renegotiate cooperate cv sindo makmur another project funding agreement regarding petrobras bonds february 4 2014 company signed funding agreement dieterich group robert terry provide 300000 likely increasing 400000 funding best efforts nonexclusive basis underwrite collection efforts undertaken series 500 bonds originally issued petrobras brazilian corporation focused oil gas exploration development bonds currently owned controlled starboard financial nevada llc recent valuation report bonds published discounted value 750000 including 7 interest february 2008 possible published redemption face value 2300000 according funding agreement company receive total recovery 10 times investment funding 125 net proceeds assuming entire funding provided company andor investors bond collections deduction trading selling expenses brazilian agents starboard financial brazilian parties received first 20000000 recovered assignment business cooperation agreement pt raksasa metal agung vanguard mining corporation april 29 2014 company signed assignment agreement assign convey transfer rights interests obligations connection business cooperation agreement pt raksasa metal agung company vanguard mining corporation fka vietnam mining corporation nevada corporation part said assignment agreement company also committed arranging required capital vnmc codevelop gold mining opportunities central java indonesia pt raksasa metal agung vnmc agreed issue two million shares 0001 par value common stock company consideration said assignment agreement company received stock compensation vnmc assisting vanguard mining corporation fka vietnam mining corporation acquisition limestone concession indonesia quarter ended june 30 2014 company provided consulting service assisted vietnam mining corporation nka vanguard mining corporation trading symbol “vnmc” acquire 75 equity interest pt mega kencana persada “mkpi” indonesian company owns limestone tenement approximate 330 hectares iup exploration license 540112k2012 dated january 27 2012 desa sipapaga kecamatan panyabungan kabupaten mandailing natal sumatra utara republic indonesia estimated amount limestone deposits concession area 150000000 metric tons subject independent verification company also committed arranging required capital vnmc develop limestone concession mkpi vnmc agreed issue three million shares 0001 par value common stock company consideration transaction date report company received stock compensation vnmc consulting agreement independent senior geologist april 30 2014 company signed consulting agreement independent senior geologist certain necessary technical services required connection review survey evaluation recommendation mining opportunities mineral assets including limited gold copper limestone coal manganese iron ores indonesia elsewhere may approved adopted company term agreement two years company agreed pay consultant one million shares common stock vietnam mining corporation nka vanguard mining corporation duration agreement payments payroll liabilities april 29 2014 chairman president company made payment amount 1928994 employment development department state california another payment amount 4197422 department treasury internal revenue service behalf company accrued payroll tax liabilities stock payment william h davidson april 8 2014 company transferred 100000 shares common stock vietnam mining corporation nka vanguard mining corporation trading symbol vnmc balance vnmc shares held phi capital holdings inc william h davidson payment towards settlement amount owed company note 11 litigation payment luberski inc april 29 2014 chairman president company made payment amount 32228500 luberski inc settle outstanding balances principal accrued interest loan dated march 30 2009 behalf company addition april 8 2014 phi capital holdings inc paid 15000 shares common stock vietnam mining corporation kna vanguard mining corporation luberski inc assignee part settlement agreement note 19 going concern uncertainty shown accompanying consolidated financial statements company accumulated deficit 36954987 june 30 2014 net loss operations 255994 fiscal year ended june 30 2014 factors well uncertain conditions company faces daytoday operations respect cash flows create uncertainty company’s ability continue going concern financial statements include adjustments might necessary company unable continue going concern management taken action strengthen company’s working capital position generate sufficient cash meet operating needs june 30 2015 beyond next twelve months company would focus energy natural resources including investing developing coal assets independent power plant projects renewable energy industrial minerals well engaging international trade phi capital holdings inc company’s wholly owned subsidiary would also continue provide corporate project finance services including merger acquisition advisory consulting services companies variety industries arranging funding energyrelated natural resource infrastructure projects company anticipated generating revenues proposed mergers acquisitions well business activities mentioned herein assurances could made management would successful achieving plan president chairman company committed funding company’s operations various sources next 12 months note 20 noncontrolling interests subsidiaries fiscal years ended june 30 2014 june 30 2013 company noncontrolling interest subsidiaries company recognized classified businesses phi gold corp formerly phi mining corporation providential vietnam ltd phi energy corp philand ranch ltd united kingdom corporation together wholly owned subsidiaries philand corporation usa philand ranch ltd singapore philand vietnam ltd discontinued operations june 30 2012 note 7 discontinued operations note 21 subsequent event financial statements approved management available issuance december 24 2014 subsequent events evaluated date business cooperation agreement dayak united energy llc august 25 2014 company signed business cooperation agreement dayak united energy llc nevada limited liability company “due” cooperate arrange financing mine market sell coal products due’s current joint operation contracts mine owners kalimantan well joint operation contracts due able secure future addition parties may time cooperate jointly engage business activities deem mutually desirable beneficial parties issuances company’s common stock august 27 2014 creditor company converted total 2770626 shortterm notes accrued interest owed company 91440 shares phi group inc’s common stock business cooperation investment agreement pt ray wolter energi september 10 2014 company signed business cooperation investment agreement pt ray wolter energi rwe member raywolter group company duly organized existing virtue laws republic indonesia primarily cooperate respect 1 developing two 225mw thermal power plants east kalimantan two 50mw thermal power plants north sulawesi two 50mw thermal power plants nusa tenggara timur 2 manufacturing installing 1000 electricity transmission towers addition communications towers across indonesia 3 mining coal supply indonesian domestic export customers well pertinent business activities deemed beneficial parties phi shall utilize best efforts invest andor cause invested rwe andor respective projects provide andor cause provided best possible technologies engineering procurement construction epc services jointly develop construct operate projects mentioned herein rwe phi enter separate definitive agreement includes specific terms conditions obligations benefits representations warranties covenants indemnities customary transaction type respect projects mentioned herein moreover rwe phi may time cooperate jointly engage business activities deem mutually acceptable beneficial parties assumption debts agent155 media corp october 29 2014 christopher martinez president agent155 media corp personally assumed balance 66955 previously owed company agent155 media corp personal obligations retroactively december 31 2011 item 9 item 8 financial statements phi group inc dave banerjee cpa accountancy corporation member aicpa pcaob burbank blvd suite 150 woodland hills ca 91367 ● 818 6570288 ● fax 818 6570299 ● 818 3123283 report independent registered public accounting firm board directors stockholders phi group inc audited accompanying consolidated balance sheets phi group inc “company” june 30 2016 2015 related statements income comprehensive income stockholders’ equity cash flows years two year period ended june 30 2016 phi group inc’s management responsible financial statements responsibility express opinion financial statements based audits conducted audits accordance standards public company accounting oversight board united states standards require plan perform audit obtain reasonable assurance whether financial statements free material misstatement company required engaged perform audit internal control financial reporting audit included consideration internal control financial reporting basis designing audit procedures appropriate circumstances purpose expressing opinion effectiveness company’s internal control financial reporting accordingly express opinion audit also includes examining test basis evidence supporting amounts disclosures financial statements assessing accounting principles used significant estimates made management well evaluating overall financial statement presentation believe audits provide reasonable basis opinion consolidated financial statements referred present fairly material respects financial position phi group inc june 30 2016 2015 results operations cash flows years two year period ended june 30 2016 conformity accounting principles generally accepted united states america accompanying financial consolidated financial statements prepared assuming company continue going concern discussed note 21 company accumulated deficit 37774842 total liabilities stockholders’ deficit 753990 june 30 2016 negative cash flow operations amounting 7998 year ended june 30 2016 factors discussed note 21 consolidated financial statements raise substantial doubt company’s ability continue going concern managements’ plan regard matters also described note 21 consolidated financial statements include adjustments might result outcome uncertainty dave banerjee cpa accountancy corporation woodland hills ca 91367 october 11 2016 phi group inc subsidiaries consolidated balance sheets audited accompanying notes form integral part audited consolidated financial statements phi group inc subsidiaries consolidated statement operations years ended june 30 2016 2015 audited accompanying notes form integral part audited consolidated financial statements phi group inc subsidiaries consolidated statements cash flows years ended june 30 2016 2015 audited accompanying notes form integral part audited consolidated financial statements phi group inc subsidiaries statement stockholders’ equity deficit years ended june 30 2016 2015 audited accompanying notes form integral part audited consolidated financial statements phi group inc subsidiaries formerly providential holdings inc notes consolidated financial statements note 1 nature business item 1 business overview phi group inc “company” “phi” nevada corporation engaged mergers acquisitions principal wwwphiglobalcom company adopted plans acquire established operating businesses selective industries invest various ventures may potentially create significant longterm value shareholders addition also provide corporate finance services including merger acquisition advisory consulting services client companies wholly owned subsidiary phi capital holdings inc wwwphicapitalholdingscom assurances made company successful achieving plans originally incorporated june 1982 jr consulting inc company foremost engaged mergers acquisitions operating subsidiary diva entertainment inc operated two modeling agencies one new york one california following business combination providential securities inc californiabased brokerage firm late 1999 company changed name providential securities inc nevada january 2000 company changed name providential holdings inc february 2000 october 2000 providential securities withdrew securities brokerage membership ceased financial services business subsequently april 2009 company changed name phi group inc october 2000 october 2011 company engaged mergers acquisitions advisory consulting services real estate hospitality development mining oil gas telecommunications technology healthcare private equity special situations october 2011 company discontinued operations providential vietnam ltd philand ranch limited united kingdom corporation together subsidiaries philand ranch singapore philand corporation us philand vietnam ltd phi gold corporation formerly phi mining corporation phi energy corporation began mainly focus acquisition development opportunities energy natural resource businesses starting july 2016 company engaged milost advisors inc new yorkbased investmentbanking firm buyside advisor begun seek acquisition opportunities industries besides energy natural resources addition phi capital holdings inc wholly owned subsidiary phi continues provide corporate project finance services including merger acquisition advisory consulting services arranging capital companies variety industries note 2 summary significant accounting policies principles consolidation consolidated financial statements include accounts phi group inc wholly owned subsidiary phi capital holdings inc discontinued operations providential securities inc phi energy corporation phi gold corp providential vietnam ltd philand ranch limited including 100 owned subsidiary philand corporation philand vietnam ltd omni resources inc cornerstone biomass corp american pacific resources inc collectively referred “company” significant intercompany transactions eliminated consolidation use estimates preparation consolidated financial statements conformity accounting principles generally accepted united states america requires management make estimates assumptions affect reported amounts assets liabilities disclosure contingent assets liabilities date financial statements reported amounts revenues expenses reporting period actual results could differ estimates cash equivalents company considers liquid investments maturity three months less date purchase readily convertible cash equivalents marketable securities company’s securities classified availableforsale carried fair value securities classified availableforsale may sold response changes interest rates liquidity needs purposes investment marketable securities typically represents less twenty percent 20 outstanding common stock equivalents investee security nationally quoted finra’s otc bulletin board “otcbb” otc markets investment accounted accordance provisions asc 320 previously sfas 115 unrealized holding gains losses availableforsale securities excluded earnings reported separate component stockholder’s equity realized gains losses securities classified availableforsale reported earnings based upon adjusted cost specific security sold june 30 2016 2015 marketable securities recorded 383770 350556 respectively based upon fair value marketable securities time accounts receivable management reviews composition accounts receivable analyzes historical bad debts june 30 2016 company accounts receivable impairment longlived assets effective january 1 2002 company adopted asc 350 previously sfas 144 “accounting impairment disposal longlived assets” addresses financial accounting reporting impairment disposal longlived assets supersedes sfas 121 “accounting impairment longlived assets longlived assets disposed of” accounting reporting provisions apb opinion 30 “reporting results operations disposal segment business” company periodically evaluates carrying value longlived assets held used accordance asc 350 asc 350 requires impairment losses recorded longlived assets used operations indicators impairment present undiscounted cash flows estimated generated assets less assets’ carrying amounts event loss recognized based amount carrying amount exceeds fair market value longlived assets loss longlived assets disposed determined similar manner except fair market values reduced cost disposal property equipment property equipment stated cost maintenance repair costs charged expense incurred costs major additions betterments capitalized property equipment sold otherwise disposed cost related accumulated depreciation eliminated accounts resulting gain loss reflected income depreciation computed using straightline method estimated useful lives assets ranging three ten years depreciation amortization cost property equipment depreciated estimated useful lives related assets depreciation amortization fixed assets computed straightline basis net earnings loss per share company adopted provisions asc 260 previously sfas 128 asc 260 eliminates presentation primary fully diluted earnings per share “eps” requires presentation basic diluted eps basic eps computed dividing income loss available common stockholders weightedaverage number common shares outstanding period diluted eps based weightedaverage number shares common stock outstanding period common stock equivalents outstanding end period net earnings loss per share computed follows stockbased compensation effective july 1 2006 company adopted asc 7181025 previously sfas 123r accordingly adopted modified prospective application method asc 7181025 applied new awards modified repurchased cancelled effective date additionally compensation cost portion awards outstanding date adoption requisite service rendered unvested options recognized period time remaining requisite services rendered fair value financial instruments fair value definition hierarchy fair value defined price would received sell asset paid transfer liability orderly transaction market participants measurement date assets liabilities measured fair value categorized based whether inputs observable market degree inputs observable categorization financial assets liabilities within valuation hierarchy based upon lowest level input significant fair value measurement fair value hierarchy inputs used measuring fair value maximizes use observable inputs minimizes use unobservable inputs requiring observable inputs used available valuation techniques consistent market income approach used measure fair value fair value hierarchy categorized three levels based inputs follows level 1 valuations based unadjusted quoted prices active markets identical assets liabilities fund ability access level 2 valuations based inputs quoted prices included level 1 observable either directly indirectly level 3 valuations based inputs unobservable significant overall fair value measurement fair value marketbased measure based assumptions prices inputs considered perspective market participant current measurement date rather entityspecific measure therefore even market assumptions readily available company’s assumptions set reflect market participants would use pricing asset liability measurement date availability valuation techniques observable inputs vary investment affected wide variety factors including type investment whether investment new yet established marketplace liquidity markets characteristics particular transaction extent valuation based upon models inputs less observable unobservable market determination fair value requires judgment inherent uncertainty valuation estimated values may materially higher lower values would used ready market investments existed accordingly degree judgment exercised fund determining fair value greatest investments categorized level 3 certain cases inputs used measure fair value may fall different levels fair value hierarchy cases level fair value hierarchy fair value measurement falls entirety determined based upon lowest level input significant fair value measurement fair value valuation techniques inputs company holds may invest public securities traded public exchanges overthecounter otc private securities real estate convertible securities interest bearing securities types securities adopted specific techniques respective valuations equity securities public companies unrestricted company values investments securities freely tradable listed major securities exchanges last reported sales price valuation date extent securities actively traded valuation adjustments applied categorized level 1 fair value hierarchy securities traded inactive markets valued reference similar instruments generally categorized level 2 3 fair value hierarchy restricted securities traded public exchanges overthecounter otc formal restrictions limit ie rule 144 holding periods underwriter’s lockups sale shall valued closing price date valuation less applicable discounts company may apply discount securities rule 144 restrictions additional discounts may assessed company believes mitigating factors warrant additional discounting determining potential additional discounts factors taken consideration include limited securities’ trading characteristics volume length overall impact restriction well macroeconomic factors valuations discounted appropriately securities may freely traded determined exchange otc listed price accurately reflect fair market value company may elect treat security private company apply alternative valuation method investments restricted securities public companies may included level 2 fair value hierarchy however extent significant inputs used determine liquidity discounts observable investments restricted securities public companies may categorized level 3 fair value hierarchy company’s financial instruments primarily consist cash equivalents accounts receivable marketable securities accounts payable balance sheet dates estimated fair values financial instruments materially different carrying values presented balance sheet primarily attributed short maturities instruments effective july 1 2008 company adopted asc 820 previously sfas 157 fair value measurements adopted statement assets liabilities shown table asc 820 clarifies definition fair value prescribes methods measuring fair value establishes fair value hierarchy based inputs used measure fair value expands disclosures use fair value measurements adoption asc 820 material impact fair value measurements asc 820 permits company defer recognition measurement nonfinancial assets nonfinancial liabilities january 1 2010 june 30 2016 company nonfinancial assets nonfinancial liabilities recognized disclosed fair value asc 820 requires financial assets liabilities reported fair value categorized one types investments based upon methodology mentioned level 1 level 2 level 3 determining fair value assets measured fair value recurring basis summarized company financial liabilities measured fair value recurring basis availableforsale securities company uses various approaches measure fair value availableforsale securities applying threelevel valuation hierarchy disclosures specified asc 820 level 1 securities measured using quoted prices active markets identical assets liabilities company’s policy regarding transfers andor level 3 depends trading activity security volatility security observable units clearly represents fair value security level 3 security measured using fairly represented fair value transfer securities either level 1 level 2 depending type inputs revenue recognition company’s revenue recognition policies compliance asc 13 previously staff accounting bulletin sab 104 company recognizes consulting advisory fee revenues transaction completed service fees earned expenses recognized period corresponding liability incurred payments received relevant criteria revenue recognition recorded unearned revenue advertising company expenses advertising costs incurred advertising costs years ended june 30 2016 2015 79072 4350 respectively increase advertising expenses current year includes expenses investor relations public relations totaling 64170 comprehensive income loss asc 2201045 previously sfas 130 reporting comprehensive income establishes standards reporting display comprehensive income components accumulated balances comprehensive income defined include changes equity except resulting investments owners distributions owners among disclosures sfas 130 requires items required recognized current accounting standards components comprehensive income reported financial statement displayed prominence financial statements june 30 2016 2015 respectively accumulated comprehensive incomes 30263 99341 presented accompanying consolidated balance sheets income taxes company accounts income taxes accordance asc 740 previously sfas 109 “accounting income taxes” deferred taxes provided liability method whereby deferred tax assets recognized deductible temporary differences deferred tax liabilities recognized taxable temporary differences temporary differences reported amounts assets liabilities tax bases deferred tax assets reduced valuation allowance opinion management likely portion deferred tax assets realized deferred tax assets liabilities adjusted effects changes tax laws rates date enactment reporting segments asc 280 previously statement financial accounting standards 131 disclosures segments enterprise related information supersedes statement financial accounting standards 14 financial reporting segments business enterprise establishes standards way public enterprises report information operating segments annual financial statements requires reporting selected information operating segments interim financial statements regarding products services geographic areas major customers asc 280 defines operating segments components enterprise separate financial information available evaluated regularly chief operating decision maker deciding allocate resources assessing performance company operated one segment generated revenues years ended june 30 2016 2015 risks uncertainties normal course business company subject certain risks uncertainties company provides service receives marketable securities upon execution transactions consequently value securities received customers affected economic fluctuations customer’s business growth actual realized value securities could significantly different recorded value recent accounting pronouncements update 201311income taxes topic 740 presentation unrecognized tax benefit net operating loss carryforward similar tax loss tax credit carryforward exists consensus fasb emerging issues task force download july effective fiscal years interim periods within years beginning december 15 2013 nonpublic entities amendments effective fiscal years interim periods within years beginning december 15 2014 early adoption permitted update 201309fair value measurement topic 820 deferral effective date certain disclosures nonpublic employee benefit plans update 201104 download july deferral amendment effective upon issuance financial statements issued update 201307presentation financial statements topic 205 liquidation basis accounting download april effective entities determine liquidation imminent annual reporting periods beginning december 15 2013 early adoption permitted update 201304liabilities topic 405 obligations resulting joint several liability arrangements total amount obligation fixed reporting date consensus fasb emerging issues task force download february effective fiscal years interim periods within years beginning december 15 2013 nonpublic entities amendments effective fiscal years ending december 15 2014 interim periods annual periods thereafter update 201302comprehensive income topic 220 reporting amounts reclassified accumulated comprehensive income download february public entities amendments effective prospectively reporting periods beginning december 15 2012 nonpublic entities amendments effective prospectively reporting periods beginning december 15 2013 early adoption permitted update 201301balance sheet topic 210 clarifying scope disclosures offsetting assets liabilities download january entity required apply amendments fiscal years beginning january 1 2013 interim periods within annual periods entity provide required disclosures retrospectively comparative periods presented effective date effective date update 201111 company either evaluated currently evaluating implications pronouncements possible impact may company’s financial statements cases management determined pronouncement either limited application company cases implementation would material impact financial statements taken whole note 3 loans receivable loans receivable consist following june 30 2016 2015 wrote total 9841 owed catalyst resource group provimex inc catthai corp year ended june 30 2016 note 4 assets comprise following june 30 2016 2015 year ended june 30 2011 company signed consulting agreement assist agent155 media corp delaware corporation respect corporate restructuring business combination freshwater technologies inc nevada corporation part restructuring requirements company made payment manning elliot llp amount 24476 behalf freshwater technologies inc loan amounts agent155 media corp fiscal year ended june 30 2014 president agent155 media corp assumed balance 66955 agent155 media corp personal obligations company july 17 2015 company made advance payment 75000 asia green corporation nevada corporation total 500000 shares common stock asia green corporation june 30 2016 total amount owed christopher martinez deposit purchase collectively reported assets totaling 141955 note 5 marketable equity securities available sale company’s marketable securities classified availableforsale carried fair value securities comprised shares common stock investee securities classified availableforsale may sold response changes interest rates liquidity needs purposes investment marketable securities represents less twenty percent 20 outstanding common stock equivalents investee security nationally quoted national association securities dealers otc bulletin board “otcbb” pink sheets investment accounted accordance provisions sfas 115 marketable securities owned company classified available sale june 30 2016 consisted 34384106 shares myson group inc formerly vanguard mining corporation 292050000 shares sports pouch beverage company public companies traded public company traded otc markets trading symbols mysn spbv respectively fair value marketable securities recorded june 30 2016 383770 company recognize another 97350000 shares sports pouch beverage company valued 97350 available sale shares returned client classified current payable accompanying consolidated financial statements fiscal year ended june 30 2016 transfer securities level 3 level 2 note 6 property equipment june 30 2016 company owned held title ten acres land parcel identification number 09705010180 190 suwannee county florida historical cost 82733 company property equipment june 30 2015 note 7 discontinued operations june 30 2012 company decided recognize businesses phi gold corp formerly phi mining corporation providential vietnam ltd phi energy corp philand ranch ltd united kingdom corporation together whollyowned subsidiaries philand corporation usa philand ranch ltd singapore philand vietnam ltd discontinued operations practical business accounting purposes june 30 2013 company recorded total 2234327 liabilities potential liability contingencies wrote nonperforming assets associated discontinued operations june 30 2016 company balance 1045232 liabilities discontinued operations note 8 accounts payable accrued expenses accounts payable accrued expenses june 30 2016 2015 consist following note 9 due officer due officer represents loans advances made officers company subsidiaries unsecured due demand june 30 2016 2015 balances 899674 1879458 respectively note 10 loans promissory notes short term notes payable june 30 2016 june 30 2015 company shortterm notes payable amounting 673660 1342618 accrued interest 2879655 3031152 respectively notes bear interest rates ranging 6 36 per annum convertible promissory note february 29 2016 company issued convertible promissory note amount 56750 auctus fund llc delaware limited liability company convertible note due payable november 29 2016 interest 10 per annum note convertible election auctus fund llc time issuance date event default amount principal interest paid due bear interest rate 24 per annum note becomes immediately due payable event default occur company liable pay 150 outstanding principal interest note agreement contains covenants requiring auctus fund’s written consent certain activities existence committed company issuance date note follows dividend distributions cash shares stock repurchases borrowings sale assets certain advances loans excess 100000 certain guarantees respect preservation existence company noncircumvention outstanding note principal interest accrued thereon converted whole part time asher issuance date equivalent company’s common stock determined 55 average two lowest closing trading prices company’s common stock twenty 20 trading days prior date note company may prepay amounts outstanding auctus fund time 180th day following issue date note making payment note holder amount cash equal 125 150 multiplied sum w outstanding principal amount note plus x accrued unpaid interest unpaid principal amount note plus default interest depending time prepayment august 30 2016 auctus fund llc converted principal amount 56750 282976 accrued interest totaling 5957976 529598 shares freetrading stock company note 22 subsequent event due preferred stockholders company classified 215000 preferred stock subscribed current liability payable holders preferred stock previously discontinued subsidiary company due deficiency compliance preferred shares subscription agreement connection referenced subsidiary year 2000 company made offer preferred stock holders receive shares common stock company exchange preferred shares far small number preferred shareholders accepted offer interest expenses payable holders preferred stock 413255 387455 included accrued interest included accrued expenses balance sheets june 30 2016 june 30 2015 respectively current payable fiscal year ended june 30 2016 company received total 389400000 shares common stock sports pouch beverage company inc recognized 292050000 shares earned revenues balance 97350000 shares returned client recorded current payable accompanying consolidated financial statements june 30 2016 advances customers september 30 2012 company decided reclassify previously recorded unearned revenues advances customers company able complete consulting services related clients due inability provide gaapcompliant audited financial statements order file registration statement securities exchange commission june 30 2016 company recorded 288219 advances customers recognizing 270000 income unearned revenues june 30 2016 company recorded 40000 client unearned revenues certain conditions met date report note 11 litigation legal proceeding settled unpaid june 30 2015 quang van cao nhan thi nguyen cao vs providential securities inc et al case originally submitted orange county superior court ca june 25 1997 case 781121 subsequently moved nasd dispute resolution arbitration august 24 2000 company’s legal counsel negotiated claimant’s counsel unilaterally reached settlement approved company process renegotiating terms said settlement claimants filed request arbitration hearing national association securities dealers october 4 2000 case 9903160 thereafter claimants filed complaint orange county superior court ca october 31 2000 case 00cc13067 alleged breach contract damages sum 75000 plus prejudgment interest costs incurred connection complaint relief without admitting denying allegations company reached settlement agreement claimants whereby company would pay claimants total 62500 plus 4500 administrative costs date report company paid 2500 subject entry judgment 79000 may 2011 claimants filed application renewal judgment total 14049078 june 30 2016 company accrued 172091 potential liabilities connection case accompanying consolidated financial statements william davidson vs doan et al february 01 2010 company notified suit filed superior court state california county los angeles november 24 2009 william davidson individual martin doan henry fahman benjamin tran hrciti corporation providential capital inc collectively referred “defendants” case bc 426831 plaintiff demanded amount less 14000000 defendants promissory notes outstanding plaintiff company july 09 2012 william davidson phi capital holdings inc formerly providential capital inc subsidiary company reached settlement agreement respect whereby phi capital agreed pay william davidson total 200000 period nineteen months beginning september 1 2012 since november 30 2012 william davidson converted portions total amount common stock phi group inc lieu cash payment company accrued 90000 required liability associated balance notes accompanying consolidated financial statements june 30 2016 note 12 payroll liabilities payroll liabilities accrued recorded accrued expenses consolidated balance sheet quarter ended june 30 2014 company paid 4197422 internal revenue service 1928994 state california employment development department towards balance 118399 payroll tax penalties interest claimed agencies company currently working internal revenue service state california employment department resolve remaining balances note 13 basic diluted net loss per share net loss per share calculated accordance sfas 128 “earnings per share” provision sfas 128 basic net loss per share computed dividing net loss period weightedaverage number common shares outstanding period diluted eps based weightedaverage number shares common stock outstanding period common stock equivalents outstanding end period basic diluted weighted average numbers shares year ended june 30 2016 since inclusion common stock equivalents antidilutive note 14 stockholder’s equity total number authorized capital stock company 400000000 shares par value 0001 per share consisting 300000000 shares voting common stock par value 0001 per share 100000000 shares preferred stock par value 0001 per share rights terms associated preferred stock determined board directors company march 15 2012 company effectuated 1 1500 reverse split company’s common stock treasury stock balance treasury stock june 30 2016 67271 postsplit shares valued 21823 common stock since july 1 2015 company issued following amounts common stock february 2 2016 company issued 121212 shares phi group inc’s restricted common stock investor auspices rule 144 40000 cash price 033 per share february 2 2016 company issued 98084 shares phi group inc’s freetrading common stock lender conversion 32000 loan principal price 03263 per share february 4 2016 company issued 100000 shares phi group inc’s restricted common stock independent consultant marketing investor relation services march 28 2016 henry fahman chairman chief executive officer company converted 1000000 debts 2688172 shares restricted common stock company conversion price 0372 per share march 28 2016 tam bui independent director chairman audit committee company converted 276500 principal loan amounts 76850 accrued unpaid interest amounts totaling 353350 949866 shares restricted common stock company conversion price 0372 per share march 28 2016 natalie bui spouse tam bui converted 38409050 principal loan amounts 1032502 shares restricted common stock company conversion price 0372 per share may 9 2016 company issued 691824 shares phi group inc’s freetrading common stock lender conversion 275000 loan principal price 03975 per share june 13 2016 company issued 100000 shares phi group inc’s restricted common stock independent consultant marketing investor relation services price 03975 per share june 28 2016 company issued 30000 shares phi group inc’s restricted common stock independent consultant marketing investor relation services price 050 per share july 29 2016 company issued 22500 shares phi group inc’s restricted common stock valued 040 per share milost advisors inc buyside advisory services connection contemplated acquisitions target companies south africa north america august 29 2016 company issued 48930 shares phi group inc’s restricted common stock investor auspices rule 144 20000 cash price 04088 per share august 30 2016 auctus fund llc converted principal amount 56750 convertible promissory note dated february 29 2016 282976 accrued interest totaling 5957976 529598 shares freetrading stock company october 12 2016 16174353 shares company’s 0001 par value common stock issued excluding 5673327 shares reserved special dividend distribution preferred stock preferred stock issued outstanding class preferred stock april 2 2015 company designated first fifty million 50000000 shares company’s previously authorized 100000000 shares preferred stock par value 0001 per share class cumulative convertible redeemable class preferred stock “class preferred stock” following rights terms 1 dividends holder class preferred stock entitled receive twelve percent 12 noncompounding cumulative dividends per annum payable semiannually 2 conversion share class preferred stock shall convertible company’s common stock time one year date issuance variable conversion price defined herein common stock “variable conversion price” shall mean 75 multiplied market price defined herein representing discount rate 25 “market price” means average trading price company’s common stock ten 10 tradingday period ending one trading day prior date conversion notice sent holder class preferred stock company via facsimile email “conversion date” “trading price” means security date closing price otc markets otcqb nasdaq stock markets nyse applicable trading market reported reliable reporting service “reporting service” mutually acceptable company holder class preferred stock 3 redemption rights company period two years date issuance may time redeem class preferred stock whole part option company’s board directors price equal one hundred twenty percent 120 original purchase price class preferred stock unit consisting shares class preferred stock warrants attached thereto plus case accumulated unpaid dividends date fixed redemption note 15 stockbased compensation plan february march 18 2015 company adopted employee benefit plan set aside 1000000 shares common stock eligible employees independent contractors company subsidiaries june 30 2016 company issued stock lieu cash plan note 16 gain loss settlement debts fiscal year ended june 30 2016 gain loss settlements debts compared net loss amount 25845 conversion promissory notes lender year ended june 30 2015 note 17 income expense net income expense fiscal year ended june 30 2016 consists following note 18 related party transactions company accrued 210000 salaries president secretary company year ended june 30 2016 note 19 income taxes provision made income tax since company significant net operating loss carry forward june 30 2016 company incurred net operating losses tax purposes approximately 37734753 net operating loss carry forward may used reduce taxable income year 2031 net operating loss carry forwards state california generally available reduce taxable income year 2022 availability company’s net operating loss carryforward subject limitation 50 positive change ownership company’s stock see note 2 “under section 6501a internal revenue code tax code section 3016501a1a income tax regulations tax regulations irs required assess tax within 3 years tax return filed irs company’s 2015 tax return open may subject examination taxing authorities” note 20 contracts commitments business financial consulting agreement thinh hung investment co fiscal year ended june 30 2010 company signed agreement thinh hung investment co ltd vietnambased company assist thinh hung identifying locating possibly acquiring various business opportunities thinh co ltd subsidiary thinh hung including limited reverse merger stock swap business combination thinh publiclytraded company us exchange services rendered company would receive compensation cash thinh hung common stock combined company september 30 2011 company consummated stock purchase investment agreement thinh anh co ltd vietnam foods corporation nevada corporation however combined company filed registration statement securities exchange commission become reporting company recognized 26656 revenues transaction fiscal year ended june 30 2016 company repaid 5000 thinh hung investment co balance 288219 booked customer advances liability portion balance sheet business cooperation investment agreement ag materials llc january 7 2015 company signed business cooperation investment agreement ag materials llc alabama limited liability company “agm” cooperate establish operate 200000 mt wood pellet plant live oak suwannee county florida parties incorporated cornerstone biomass corporation florida corporation entity manage jointventure wood pellet project live oak florida july 31 2015 phi group inc purchased ten acres land namely lots 18 19 eagle’s nest live oak florida 32060 klausner holding usa inc georgia corporation purpose establishing wood pellet plant due recent adverse changes respect global industrial wood pellet markets company decided pursue wood pellet plant project june 30 2016 company written investment cornerstone biomass corporation business cooperation agreement master contract purchase sale sand kien hoang minerals joint stock company may 8 2015 company signed business cooperation agreement kien hoang minerals joint stock company ” khm jsc” vietnamese company develop expand international markets khm’s mineral products particularly exports reclamation sand granite singapore primearth resources asia pte ltd another strategic partner company’s company granted first right refusal khm purchase approximately 102 million cubic meters sand 40 million cubic meters granite june 12 2015 company signed master contract purchase sale 60 million cubic meters sand recovered dredging clearing traffic pathways de gi estuary surrounding areas binh dinh province vietnam period five years exports singapore asian markets date report company shipped sand agreements intends pursue business activity consulting agreement sports pouch beverage company june 3 2015 phi capital holdings inc wholly owned subsidiary company signed consulting engagement agreement sports pouch beverage company “spbv” nevada corporation provide consulting services assist spbv respect business development mergers acquisitions corporate governance corporate finance phi capital holdings inc entitled receive forty percent common stock spbv compensation services rendered duration agreement one year june 30 2016 phi capital holdings inc received 389400000 shares spbv stock recorded total 292050000 shares earned revenues transaction balance 97350000 shares returned client recorded current payable valued 97350 accompanying consolidated financial statements agreement primeforth renewable energy ltd june 24 2015 phi capital holdings inc wholly owned subsidiary company signed consulting engagement agreement primeforth renewable energy ltd “primeforth” singaporean company provide consulting services respect corporate development corporate finance debt financing primeforth renewable energy phi capital holdings entitled onetime nonrefundable professional fee 20000 4 cash success fee financing arranged primeforth company also entitled additional compensations advisory business development services client term agreement two years year ended june 30 2016 company recorded 40000 earned revenues connection agreement primeforth engaged developing alternative energy using patented microalgae technologies settlement agreement hai p nguyen consulting service july 16 2015 company signed settlement payment agreement hai p nguyen agreed pay latter 25000 cash 500000 shares common stock myson group inc compensation hai p nguyen’s portion contribution towards budget complete services connection consulting agreement dated january 24 2014 vietnam mining corporation known myson group inc phi capital holdings inc year ended june 30 2016 company fulfilled obligations agreement paying hai nguyen 25000 cash 2500 advanced president company 500000 shares common stock myson group inc agreement defrayal expenses stock compensation asia green corporation july 17 2015 company signed agreement provide 75000 asia green corporation agmc” nevada corporation agmc pay certain required expenses resume status fully reporting company securities exchange commission exchange fund agmc agrees allocate 500000 shares common stock upon consummation business combination vietnamese company engaged agriculture reforestation amount recorded deposit acquisition company’s balance sheet june 30 2016 business cooperation investment agreement cavico lao mining co ltd august 7 2015 company signed business cooperation investment agreement cavico lao mining co ltd “clm” provide initial required capital raised company’s 506c private placement clm’s interim operations budget conduct independent jorc report nickel portion clm’s 80hectare multimineral mine khoam bang mountainous area ban bo bulikhamsay laos people’s democratic republic addition company shall establish subsidiary holding company clm’s assets spun separate publicly traded company “pubco” nasdaq stock markets subject certain conditions requirements date report company successful raising required capital clm intends pursue transaction unless funding available master agreement business cooperation dredge masters civil works august 19 2015 company signed agreement dredge masters civil works inc filipino corporation cooperate order optimize dredging transshipment loading shipping unloading saline sand large scales serve needs land reclamation singaporean asian countries term agreement one year expired august 18 2016 stock purchase investment agreement vinabenny energy joint stock company september 1 2015 company signed agreement acquire 5010 equity ownership vinabenny energy joint stock company “vinabenny” vietnamese company 10700000 arrange capital vinabenny complete 84000 mt liquefied petroleum gas lpg terminal giuoc district long province vietnam agreement expired december 31 2015 agreement redicsaco joint stock company september 11 2015 company signed principle business investment agreement redicsaco jsc vietnamese company cooperate respect dredging transshipment loading sale export saline reclamation sand ham luong river waterway ben tre province vietnam singapore brunei asian markets initial authorized volume sand location 25 million cubic meters total reserve 390 million cubic meters date report company successful developing project due changes market conditions intends pursue transaction agreement hatico investment development joint stock company september 11 2015 company signed principle business cooperation agreement hatico investment development joint stock company vietnamese company cooperate order dredge sell export saline reclamation sand ha tien kien giang province vietnam develop deepwater seaport terminal location estimated volume sand location approximately one billion cubic meters parties agreed principle company acquire 5090 hatico percentage joint venture company set date report company successful developing project due changes market conditions intends pursue transaction business cooperation investment agreement hung thinh minerals investment co october 26 2015 company signed principle business cooperation investment agreement hung thinh minerals investment co ltd “htmi” vietnamese company owns titanium mine slag processing plant binh thuan province vietnam cooperate htmi increase capacity produce 150000 mt titanium slag per year develop htmi major refiner titaniumrelated products including titanium pigments ingots sponge alloys list htmi international stock exchange raise capital growth expansion program phi group inc acquire 49 htmi plus 2 proxy voting right htmi prerequisite cooperate htmi development program closing transaction subject satisfactory due diligence review htmi signing definitive agreement htmi’s compliance us generally accepted accounting principles gaap date report company successful obtaining complete financial information htmi conduct required due diligence review intends pursue transaction business cooperation investment agreement spartan mining development corporation october 30 2015 company signed principle business cooperation investment agreement spartan mining development corporation “smdc” philippine company form joint venture smdc phi group inc dredge extract process sell export lahar sand sto tomas maloma bucao rivers province zamales philippines total volume lahar sand dredged rivers estimated 14 billion metric tonnes sand created mount pinatubo volcanic eruption june 1991 november 24 2015 parties signed joint venture agreement form joint venture corporation preferably styled “phispartan resources inc” order implement provisions principle business cooperation agreement date agreement company made investment joint venture company sale purchase agreements marine sand export singapore december 16 2015 company signed sale purchase agreements two vietnamese companies ha thanh irrigation co ltd hoai nhon irrigation co ltd export marine sand recovered dredging projects binh dinh province central vietnam singapore reclamation purposes however company able begin shipments sand april 2016 anticipated due structural changes affected vietnamese companies though contracts expire december 31 2016 deemed null void unenforceability investment antimony mine lao people’s demoractic republic january 19 20 2016 company signed business cooperation agreement investment agreement khamchaleun investment sole co ltd laotian company acquire 35 equity interest hung kham lao investment co ltd coinvest 92km2 antimony mine chalet village boualapha district khammuane province people’s democratic republic antimony mining company granted quota extract process sell 350000 metric tons antimony mine date report company made investment khamchaleun investment sole co intends pursue transaction acquisition majority interest liquefied petroleum gas company vietnam january 23 2016 phi group inc “company” entered private stock purchase sale agreement purchase 5090 equity ownership “exchange ownership” pacific petro commercial joint stock company aka pacific petro trading corporation vietnamese company hereinafter referred “pacific petro” exchange combination cash common stock andor preferred stock company fair value exchange ownership determined majority shareholders pacific petro “majority shareholders” company completion business valuation pacific petro grant thornton vietnam ltd financial audits pacific petro pcaobregistered auditing firm originally established binh duong gas llc 1998 pacific petro changed name pacific petro commercial joint stock company aka pacific petro trading corporation may 2010 company’s headquarters located 99 ich thanh street truong thanh ward district 9 ho chi minh city vietnam website httpwwwpacificpetrocomvn pacific petro third largest private liquefied petroleum gas lpg company southern vietnam engaged sales liquefied petroleum gas lpg manufacturing gas canisters cylinders filling lpg repair maintenance gas tanks wholesale solid fuels liquid gas related petroleum products company owns gas canistermanufacturing factory 215200 squarefoot lot ben cat district binh duong province gas filling plant 65600 squarefoot lot district 9 ho chi minh city vietnam also acquired 93600 squarefoot lot go dau industrial park dong nai province build proprietary lpg storage area granted 83 acres phu huu village nhon trach district dong nai province build integrated port imports energyrelated commodities products phi group engaged grant thornton conduct independent business valuation completed required financial audits pacific petro expiration aforementioned purchase sale agreement june 30 2016 parties agreed conditional extension transaction intend renegotiate terms conditions payment memorandum understanding business cooperation investment march 9 2016 company signed memorandum understanding business cooperation investment ses meas gas import export construction development co ltd “ses meas” cambodian company cooperate develop liquefied petroleum gas lpg energyrelated businesses cambodia including limited increasing ses meas market share lpg business cambodia establishing dry port lpg storage logistics facilities engaging wastetoenergy business potentially establishing operating oil refinery cambodia conjunction qualified international investor subsequently company signed joint venture agreement wbj import export co ltd affiliate ses meas establish manage operate dry port cambodia april 30 2016 company signed joint venture agreement wbj import export co ltd affiliate ses meas establish manage operate dry port cambodia according joint venture agreement phi group inc contribute 65 investment capital dry port project hold 65 equity interest joint venture company light recent contemplated acquisition activities company following close fiscal year ended june 30 2016 company intends reevaluate potential contribution priority project compared investment opportunities business cooperation agreement pt jaya sakti globalindo march 17 2016 company signed business cooperation agreement pt jaya sakti globalindo jsg indonesian company utilize hard assets held jsg affiliates collaterals project financing parties intend enter definitive agreements collateral provision connection specific projects terms conditions provisions date report company undertaken projects would qualify utilization collateral assets jsg affiliates letter intent acquire wood pellet company alabama april 27 2016 company signed letter intent acquire lee energy solutions llc alabama company owns 100000 mtyear wood pellet manufacturing facility crossville alabama letter intent amended twice expired september 20 2016 note 21 going concern uncertainty shown accompanying consolidated financial statements company accumulated deficit 37734753 total liabilities stockholders’ deficit 656730 june 30 2016 factors well uncertain conditions company faces daytoday operations respect cash flows create uncertainty company’s ability continue going concern financial statements include adjustments might necessary company unable continue going concern management taken action strengthen company’s working capital position generate sufficient cash meet operating needs june 30 2017 beyond next twelve months company intends continue pursuing merger acquisition program acquiring controlling interests target companies number industries including limited conventional energy renewables natural resources agribusiness technology transportation education distribution mining oil gas financial services healthcare pharmaceuticals believe closing one transactions contemplated note 22 subsequent event able build critical mass uplist nasdaq stock market nyse near future addition continue provide advisory consulting services international clients wholly owned subsidiary phi capital holdings inc company anticipates generating substantial amounts revenues merger acquisition program advisory services mentioned herein however assurances could made management would successful achieving plan president chairman company committed funding company’s operations various sources next 12 months note 22 subsequent event financial statements approved management available issuance october 11 2016 subsequent events evaluated date engagement letter milost advisors inc july 11 2016 company signed engagement letter milost advisors inc assist company analysis consideration appropriate execution various financial strategic alternatives available including securing additional equity andor debt capital assisting company analysis consideration financial aspects certain potential strategic transactions mergers acquisitions spinoffs joint ventures minority investments negotiated purchases similar transactions consideration services rendered milost company agrees pay milost retainer fee equal 100000 payable form 10000 cash 90000 stock company valued 040 per share company also agrees pay milost success fee 8 equity financing 5 mezzanine senior debt financings memorandum understanding milost global inc july 18 2016 company signed memorandum understanding milost global inc us private equity firm cooperate promoting competitiveness well joint activities acquire cashflow positive companies north america south africa australia singapore new zealand seek growth alternatives order fasttrack shareholder value dividend distribution parties agree use milost advisors inc first right refusal advisor conduct strategic planning exercise form new special purpose company spc partnership activities carried spc held managed controlled parties pari passu intended partnership assist parties implementation combined growth strategies help identify areas party provide capacity building support letter intent acquire south african mining services company july 19 2016 company presented preconditional nonbinding undertaking make offer acquire entire issued capital undisclosed south african mining services company listed johannesburg stock exchange “sa target” july 25 2016 approval given sa target’s board directors management team enter discussions phi group good faith proceed due diligence process outlined undertaking following completion due diligence process conducted milost advisors inc company september 3 2016 company presented letter intent “loi” sa target acquire issued capital exchange common stock phi group exchange rate would determined basis 10 days’ volumeweighted average price vwap companies day loi according loi company also commits provision usd 20 million shareholder loan facility sa target approximately usd 12 million used repayment sa target subsidiary’s term loan remaining usd 8 million available draw facility financing working capital requirements sa target usd 12 million facility noninterest bearing company effectively turned around whilst minority shareholders buildmax thereafter interest 5 per annum charged shareholder loan repaid period agreed depending free cash flow generated sa target september 6 2016 approval granted sa target’s board directors independent board management team enter discussions phi group good faith proceed transaction september 14 2016 company received confirmation sa target’s management 77 shareholders sa target approved acquisition offer phi group october 10 2016 milost global inc submitted revised offer sa target declined sa target’s board directors october 11 2016 company intends renegotiate terms conditions transaction secured line credit facility tca global credit master fund lp august 30 2016 company signed term sheet tca global credit master fund lp “investor” maximum 15000000 senior secured line credit 4000000 made available company first drawdown “initial line credit” acquisition financing closing date start date line credit facility company discretion investor may request increase line credit agreed upon time periods agreed upon amounts sum initial line credit subsequent line increases “then current line size” shall exceed maximum line credit subsequent line increase require company execute deliver new revised revolving note investor responsible fees expenses associated line increase line credit may drawn investor’s discretion repaid company throughout term facility amount requested drawn “advance” shall exceed 80 repayments investor’s designated account less interest fees reserve amount current line size satisfied frequency advances mutually agreed upon investor company milost global inc agrees invest 100 million phi group inc september 8 2016 company entered letter intent milost global inc us private equity firm respect principal terms conditions milost global inc invest 100 million phi group inc investment amount 50 million equity 50 million loan september 25 2016 company signed agreement milost global inc 50 million structured milost equity subscription agreement ‘mesa” whereby milost global willing initially invest 15 million working capital needs phi group amount 15 million drawn tranches minimum 500000 fully utilized mesa utilized share exchange milost global inc phi group balance 50 million facility available equity leakage fir future acquisitions phi group according structure mesa milost global inc entitled purchase shares common stock phi group price per share basis 2 discount 20 company milost agree long company’s stock price reached 2 per share milost global inc receive company’s convertible notes instead company’s shares drawdown milost global inc right convert convertible notes common shares company price phi group’s stock reaches target price 2 company agrees pay milost global inc commitment fee equal 4 total commitment payable within 3 business days price company’s common stock reaches target price 6 september 27 2016 company submitted drawdown notice milost global inc total 2750000 mesa’s total 50million commitment form convertible note bearing annual interest 5 convertible common stock 20 discount phi group’s common stock reaches 2 per share proceeds drawdown allocated follows 2150000 towards cash payment purchase agricultural company “agri target” southeastern united states 500000 due diligence document fees acquisitions sa target agri target educational company canada 100000 general working capital september 28 2016 milost global inc confirmed 500000 remitted milost advisors milost global inc behalf phi group inc part first drawdown notice presented milost global inc company letter intent acquire agricultural business southeastern united states august 24 2016 company tendered letter intent acquire undisclosed fruit vegetable company “agri target” southeastern united states total 81 cash 19 common stock phi group september 6 2016 owner agri target made counter offer accepted company september 16 2016 company process conducting due diligence review agri target expects close transaction soon practical average annual sales agri target approximately 25 million letter intent acquire canadian educational company september 3 2016 company signed letter intent acquisition “loia” undisclosed educational company canada “edu target” owns operates 21 campuses enrolls approximately 20000 students yearly various english language career training educational courses according loia company acquire issued outstanding shares edu target exchange common stock phi group provide total c20 million cash stock investment edu target settle bank debts allow operating working capital october 3 2016 company presented revised loia edu target modify terms transaction whereby company agrees acquire approximately 311286356 shares edu target’s stock valued c00165 per shares exchange common stock phi group addition company provide c20 million cash investment c62 million settlement bank debts remaining balance c138 operating working capital parties intend proceed definitive sale purchase agreement order close transaction soon practical subject additional due diligence review edu target consulting service agreement tans compamy ltd september 9 2016 phi capital holdings inc signed consulting service agreement tans company ltd vietnambased company provide advisory consulting services nonexclusive basis assist tans co becoming publicly traded company us stock market company entitled cash compensations tans co portion equity new public company sale land live oak florida september 21 2016 company entered sale purchase agreement sell two lots land live oak florida lot 18 19 eagle’s nest according plat book 1 page 502 public records suwannee county florida back klausner holding usa inc georgia corporation 65000 transaction scheduled close december 9 2016 consulting service agreement september 23 2016 company signed agreement engage consultant due diligence business development corporate services period year company agreed pay consultant onetime fee one hundred thousand restricted shares phi group’s stock compensations term agreement option grants september 23 2016 board directors company approved option grants current members board directors president chief executive officer phi group inc acquire 6520000 shares company’s common stock exercise price 024 per share based 10days’ volumeweighted average price phi group inc’s common stock prior grant date options vested one year grant date memorandum understanding acquire abound farms inc september 30 2016 company signed memorandum understanding abound farms inc “afi target” us company acquire 100 afi target afi target engaged hydroponics possesses proprietary water treatment systems nutrients known substantially enhance farming yields mou sets forth guidelines negotiations afi target company signing definitive agreement contains representations warranties covenants indemnities customary transaction type company intends incorporate afi target’s water treatment systems nutrients agri target’s business closing transactions agreements investor public relations services september 30 2016 company signed agreements two independent consulting firms investor public relations services total period six months company agreed pay companies total 35000 cash 100000 shares restricted common stock phi group inc issuances convertible promissory notes july 20 2016 company issued convertible promissory note amount 50000 ema financial llc delaware limited liability company note coupon rate 10 matures one year convertible common stock company conversion price equals lower closing sale price common stock principal market trading immediately preceding closing date note ii 55 lowest sale price common stock principal market twenty 20 consecutive trading days immediately preceding conversion date note may prepaid 130 145 outstanding principal interest 180 days august 16 2016 company issued convertible promissory note amount 56750 auctus fund llc delaware limited liability company note coupon rate 10 matures may 16 2017 convertible common stock company conversion price equals lower 50 multiplied average two lowest trading price previous twentyfive trading day period ending latest complete trading date prior date note ii 50 multiplied average two lowest trading prices common stock twentyfive trading day period ending latest complete trading day prior conversion date note may prepaid 135 150 outstanding principal interest 180 days company intends prepay notes within respective allowable prepayment time frames issuances company’s common stock july 29 2016 company issued 22500 shares phi group inc’s restricted common stock valued 040 per share milost advisors inc buyside advisory services connection contemplated acquisitions target companies south africa north america august 29 2016 company issued 48930 shares phi group inc’s restricted common stock investor auspices rule 144 20000 cash price 04088 per share august 30 2016 auctus fund llc converted principal amount 56750 convertible promissory note dated february 29 2016 282976 accrued interest totaling 5957976 529598 shares freetrading stock company item 9 item 8 financial statements phi group inc auditors’ report ms madhava rao topham st tarzana ca 91335 report independent registered public accounting firm board directors shareholders phi group inc main street irvine ca 92614 opinion financial statements audited accompanying consolidated balance sheet phi group inc “company” june 30 2019 related statements operations changes shareholders’ deficit related notes collectively referred “financial statements” opinion financial statements present fairly material respects financial position company june 30 2019 results operations cash flows period june 30 2019 conformity accounting principles generally accepted united states america consideration company’s ability continue going concern accompanying financial statements prepared assuming company continue going concern discussed note 22 financial statements company incurred losses since inception accumulated significant deficit negative cash flows operations currently revenues factors raise substantial doubt ability continue going concern managements plans regard matters also described note 22 financial statements include adjustments might result outcome uncertainty basis opinion financial statements responsibility company’s management responsibility express opinion company’s financial statements based audits public accounting firm registered public company accounting oversight board united states “pcaob” required independent respect company accordance us federal securities laws applicable rules regulations securities exchange commission pcaob conducted audits accordance standards pcaob standards require plan perform audits obtain reasonable assurance whether financial statements free material misstatement whether due error fraud company required engaged perform audit internal control financial reporting part audits required obtain understanding internal control financial reporting purpose expressing opinion effectiveness company’s internal control financial reporting accordingly express opinion audits included performing procedures assess risks material misstatement financial statements whether due error fraud performing procedures respond risks procedures included examining test basis evidence regarding amounts disclosures financial statements audits also included evaluating accounting principles used significant estimates made management well evaluating overall presentation financial statements believe audits provide reasonable basis opinion madhava rao ms madhava rao chartered accountant bangalore india march 10 2021 phi group inc subsidiaries consolidated balance sheets audited accompanying notes form integral part audited consolidated financial statements phi group inc subsidiaries consolidated statement operations audited years ended accompanying notes form integral part audited consolidated financial statements phi group inc subsidiaries consolidated statements cash flows years ended june 30 2019 2018 audited accompanying notes form integral part audited consolidated financial statements phi group inc subsidiaries statement stockholders’ equity deficit years ended june 30 2019 2018 audited note issued conversions promissory notes par value 004 per share prior 4132009 0001 per share 4132009 accompanying notes form integral part audited consolidated financial statements phi group inc subsidiaries formerly providential holdings inc notes consolidated financial statements note 1 nature business phi group inc “company” “phi” wwwphiglobalcom primarily engaged operations philux global funds sca sicavraif “reserved alternative investment fund” “raif” laws luxembourg development asia diamond exchange vietnam besides company provides corporate finance services including merger acquisition advisory consulting services client companies wholly owned subsidiary philux capital advisors inc formerly phi capital holdings inc wwwphiluxcapcom invests selective industries well special situations may potentially create significant longterm value shareholders philux global funds include number subfunds investment agriculture renewable energy real estate infrastructure asia diamond exchange vietnam background originally incorporated june 8 1982 jr consulting inc nevada corporation company applied certificate domestication filed articles domestication become wyoming corporation september 20 2017 beginning company foremost engaged mergers acquisitions operating subsidiary diva entertainment inc operated two modeling agencies one new york one california january 2000 company changed name providential securities inc nevada corporation following business combination providential securities inc californiabased financial services company changed name providential holdings inc february 2000 october 2000 providential securities withdrew securities brokerage membership ceased financial services business subsequently april 2009 company changed name phi group inc october 2000 october 2011 company subsidiaries engaged mergers acquisitions advisory consulting services real estate hospitality development mining oil gas telecommunications technology healthcare private equity special situations october 2011 company discontinued operations providential vietnam ltd philand ranch limited united kingdom corporation together subsidiaries philand ranch singapore philand corporation us philand vietnam ltd vietnam phi gold corporation formerly phi mining corporation nevada corporation phi energy corporation nevada corporation mainly focused acquisition development opportunities energy natural resource businesses company currently focused operating philux global funds sca sicavraif setting number subfunds investment real estate renewable energy infrastructure agriculture healthcare well developing establishing asia diamond exchange vietnam addition philux capital advisors inc formerly capital holdings inc wholly owned subsidiary company continues provide corporate project finance services including merger acquisition advisory consulting services client companies assurances made company successful achieving plans note 2 summary significant accounting policies principles consolidation consolidated financial statements include accounts phi group inc wholly owned subsidiaries 1 american pacific resources inc wyoming corporation 100 2 phi capital holdings inc name changed philux capital advisors inc june 03 2020 wyoming corporation 100 3 phi luxembourg development sa luxembourg corporation 100 collectively referred “company” significant intercompany transactions eliminated consolidation use estimates preparation consolidated financial statements conformity accounting principles generally accepted united states america requires management make estimates assumptions affect reported amounts assets liabilities disclosure contingent assets liabilities date financial statements reported amounts revenues expenses reporting period actual results could differ estimates cash equivalents company considers liquid investments maturity three months less date purchase readily convertible cash equivalents marketable securities company’s securities classified availableforsale carried fair value securities classified availableforsale may sold response changes interest rates liquidity needs purposes investment marketable securities typically represents less twenty percent 20 outstanding common stock equivalents investee security quoted national exchange otc markets investment accounted accordance provisions asc 320 previously sfas 115 unrealized holding gains losses availableforsale securities excluded earnings reported separate component stockholder’s equity realized gains losses securities classified availableforsale reported earnings based upon adjusted cost specific security sold june 30 2019 2018 marketable securities recorded 213485 1100483 respectively based upon fair value marketable securities time accounts receivable management reviews composition accounts receivable analyzes historical bad debts june 30 2019 company wrote 432000 accounts receivable previous fiscal year due noncollectibility impairment longlived assets effective january 1 2002 company adopted asc 350 previously sfas 144 “accounting impairment disposal longlived assets” addresses financial accounting reporting impairment disposal longlived assets supersedes sfas 121 “accounting impairment longlived assets longlived assets disposed of” accounting reporting provisions apb opinion 30 “reporting results operations disposal segment business” company periodically evaluates carrying value longlived assets held used accordance asc 350 asc 350 requires impairment losses recorded longlived assets used operations indicators impairment present undiscounted cash flows estimated generated assets less assets’ carrying amounts event loss recognized based amount carrying amount exceeds fair market value longlived assets loss longlived assets disposed determined similar manner except fair market values reduced cost disposal property equipment property equipment stated cost maintenance repair costs charged expense incurred costs major additions betterments capitalized property equipment sold otherwise disposed cost related accumulated depreciation eliminated accounts resulting gain loss reflected income depreciation computed using straightline method estimated useful lives assets ranging three ten years depreciation amortization cost property equipment depreciated estimated useful lives related assets depreciation amortization fixed assets computed straightline basis net earnings loss per share company adopted provisions asc 260 previously sfas 128 asc 260 eliminates presentation primary fully diluted earnings per share “eps” requires presentation basic diluted eps basic eps computed dividing income loss available common stockholders weightedaverage number common shares outstanding period diluted eps based weightedaverage number shares common stock outstanding period common stock equivalents outstanding end period net earnings loss per share computed follows stockbased compensation effective july 1 2006 company adopted asc 7181025 previously sfas 123r accordingly adopted modified prospective application method asc 7181025 applied new awards modified repurchased cancelled effective date additionally compensation cost portion awards outstanding date adoption requisite service rendered unvested options recognized period time remaining requisite services rendered fair value financial instruments fair value definition hierarchy fair value defined price would received sell asset paid transfer liability orderly transaction market participants measurement date assets liabilities measured fair value categorized based whether inputs observable market degree inputs observable categorization financial assets liabilities within valuation hierarchy based upon lowest level input significant fair value measurement fair value hierarchy inputs used measuring fair value maximizes use observable inputs minimizes use unobservable inputs requiring observable inputs used available valuation techniques consistent market income approach used measure fair value fair value hierarchy categorized three levels based inputs follows level 1 valuations based unadjusted quoted prices active markets identical assets liabilities fund ability access level 2 valuations based inputs quoted prices included level 1 observable either directly indirectly level 3 valuations based inputs unobservable significant overall fair value measurement fair value marketbased measure based assumptions prices inputs considered perspective market participant current measurement date rather entityspecific measure therefore even market assumptions readily available company’s assumptions set reflect market participants would use pricing asset liability measurement date availability valuation techniques observable inputs vary investment affected wide variety factors including type investment whether investment new yet established marketplace liquidity markets characteristics particular transaction extent valuation based upon models inputs less observable unobservable market determination fair value requires judgment inherent uncertainty valuation estimated values may materially higher lower values would used ready market investments existed accordingly degree judgment exercised fund determining fair value greatest investments categorized level 3 certain cases inputs used measure fair value may fall different levels fair value hierarchy cases level fair value hierarchy fair value measurement falls entirety determined based upon lowest level input significant fair value measurement fair value valuation techniques inputs company holds may invest public securities traded public exchanges overthecounter otc private securities real estate convertible securities interest bearing securities types securities adopted specific techniques respective valuations equity securities public companies unrestricted company values investments securities freely tradable listed major securities exchanges last reported sales price valuation date extent securities actively traded valuation adjustments applied categorized level 1 fair value hierarchy securities traded inactive markets valued reference similar instruments generally categorized level 2 3 fair value hierarchy restricted securities traded public exchanges overthecounter otc formal restrictions limit ie rule 144 holding periods underwriter’s lockups sale shall valued closing price date valuation less applicable discounts company may apply discount securities rule 144 restrictions additional discounts may assessed company believes mitigating factors warrant additional discounting determining potential additional discounts factors taken consideration include limited securities’ trading characteristics volume length overall impact restriction well macroeconomic factors valuations discounted appropriately securities may freely traded determined exchange otc listed price accurately reflect fair market value company may elect treat security private company apply alternative valuation method investments restricted securities public companies may included level 2 fair value hierarchy however extent significant inputs used determine liquidity discounts observable investments restricted securities public companies may categorized level 3 fair value hierarchy company’s financial instruments primarily consist cash equivalents accounts receivable marketable securities shortterm notes payable convertible notes derivative liability accounts payable balance sheet dates estimated fair values financial instruments materially different carrying values presented balance sheet primarily attributed short maturities instruments effective july 1 2008 company adopted asc 820 previously sfas 157 fair value measurements adopted statement assets liabilities shown table asc 820 clarifies definition fair value prescribes methods measuring fair value establishes fair value hierarchy based inputs used measure fair value expands disclosures use fair value measurements adoption asc 820 material impact fair value measurements asc 820 permits company defer recognition measurement nonfinancial assets nonfinancial liabilities january 1 2010 june 30 2018 company nonfinancial assets nonfinancial liabilities recognized disclosed fair value asc 820 requires financial assets liabilities reported fair value categorized one types investments based upon methodology mentioned level 1 level 2 level 3 determining fair value assets measured fair value recurring basis summarized company also convertible notes derivative liabilities disclosed report measured fair value regular basis paid exercised company uses various approaches measure fair value availableforsale securities applying threelevel valuation hierarchy disclosures specified asc 820 level 1 securities measured using quoted prices active markets identical assets liabilities company’s policy regarding transfers andor level 3 depends trading activity security volatility security observable units clearly represents fair value security level 3 security measured using fairly represented fair value transfer securities either level 1 level 2 depending type inputs revenue recognition standards asc 60610 provides following overview revenue recognized entity’s contracts customers entity recognizes revenue depict transfer promised goods services customers amount reflects consideration entity expects entitled exchange goods services step 1 identify contracts customer step 2 identify performance obligations contract step 3 determine transaction price transaction price amount consideration contract entity expects entitled exchange transferring promised goods services customer step 4 allocate transaction price performance obligations contract entity typically allocates transaction price performance obligation basis relative standalone selling prices distinct good service promised contract step 5 recognize revenue entity satisfies performance obligation entity recognizes revenue satisfies performance obligation transferring promised good service customer obtains control good service amount revenue recognized amount allocated satisfied performance obligation performance obligation may satisfied point time typically promises transfer goods customer time typically promises transfer service customer performance obligations satisfied time entity recognizes revenue time selecting appropriate method measuring entity’s progress toward complete satisfaction performance obligation paragraphs 60610 2523 2530 addition asc 60610 contains guidance disclosures related revenue notes following also includes cohesive set disclosure requirements would result entity providing users financial statements comprehensive information nature amount timing uncertainty revenue cash flows arising entity’s contracts customers specifically section 6061050 requires entity provide information revenue recognized contracts customers including disaggregation revenue appropriate categories contract balances including opening closing balances receivables contract assets contract liabilities performance obligations including entity typically satisfies performance obligations transaction prices allocated remaining performance obligations contract significant judgments changes judgments made applying requirements contracts additionally section 3404050 requires entity provide quantitative andor qualitative information assets recognized costs obtain fulfill contract customer company’s revenue recognition policies compliance asc 60610 company recognizes consulting advisory fee revenues accordance abovementioned guidelines expenses recognized period corresponding liability incurred advertising company expenses advertising costs incurred advertising costs years ended june 30 2019 2018 50377 36221 respectively increase advertising expenses primarily due investor relations expenses 31507 fiscal year ended june 30 2019 comprehensive income loss asc 2201045 previously sfas 130 reporting comprehensive income establishes standards reporting display comprehensive income components accumulated balances comprehensive income defined include changes equity except resulting investments owners distributions owners among disclosures sfas 130 requires items required recognized current accounting standards components comprehensive income reported financial statement displayed prominence financial statements june 30 2019 2018 respectively accumulated comprehensive income loss 0 751962 presented accompanying consolidated balance sheets income taxes company accounts income taxes accordance asc 740 previously sfas 109 “accounting income taxes” deferred taxes provided liability method whereby deferred tax assets recognized deductible temporary differences deferred tax liabilities recognized taxable temporary differences temporary differences reported amounts assets liabilities tax bases deferred tax assets reduced valuation allowance opinion management likely portion deferred tax assets realized deferred tax assets liabilities adjusted effects changes tax laws rates date enactment reporting segments asc 280 previously statement financial accounting standards 131 disclosures segments enterprise related information supersedes statement financial accounting standards 14 financial reporting segments business enterprise establishes standards way public enterprises report information operating segments annual financial statements requires reporting selected information operating segments interim financial statements regarding products services geographic areas major customers asc 280 defines operating segments components enterprise separate financial information available evaluated regularly chief operating decision maker deciding allocate resources assessing performance company operated one revenuegenerating segment year ended june 30 2019 two segments year ended june 30 2018 risks uncertainties normal course business company subject certain risks uncertainties company provides service receives marketable securities upon execution transactions consequently value securities received customers affected economic fluctuations customer’s business growth actual realized value securities could significantly different recorded value recent accounting pronouncements update 201813 august 2018 fair value measurement topic 820 changes disclosure requirements fair value measurement modifications following disclosure requirements modified topic 820 1 lieu rollforward level 3 fair value measurements nonpublic entity required disclose transfers level 3 fair value hierarchy purchases issues level 3 assets liabilities 2 investments certain entities calculate net asset value entity required disclose timing liquidation investee’s assets date restrictions redemption might lapse investee communicated timing entity announced timing publicly 3 amendments clarify measurement uncertainty disclosure communicate information uncertainty measurement reporting date additions following disclosure requirements added topic 820 however disclosures required nonpublic entities 1 changes unrealized gains losses period included comprehensive income recurring level 3 fair value measurements held end reporting period 2 range weighted average significant unobservable inputs used develop level 3 fair value measurements certain unobservable inputs entity may disclose quantitative information median arithmetic average lieu weighted average entity determines quantitative information would reasonable rational method reflect distribution unobservable inputs used develop level 3 fair value measurements amendments update effective entities fiscal years interim periods within fiscal years beginning december 15 2019 update 201807 june 2018 compensation stock compensation topic 718 improvements nonemployee sharebased payment accounting main provisions amendments update expand scope topic 718 include sharebased payment transactions acquiring goods services nonemployees entity apply requirements topic 718 nonemployee awards except specific guidance inputs option pricing model attribution cost period time sharebased payment awards vest pattern cost recognition period amendments specify topic 718 applies sharebased payment transactions grantor acquires goods services used consumed grantor’s operations issuing sharebased payment awards amendments also clarify topic 718 apply sharebased payments used effectively provide 1 financing issuer 2 awards granted conjunction selling goods services customers part contract accounted topic 606 revenue contracts customers amendments update effective public business entities fiscal years beginning december 15 2018 including interim periods within fiscal year update 201713 september 2017 revenue recognition topic 605 revenue contracts customers topic 606 fasb accounting standards updates 201409 revenue contracts customers topic 606 issued may 2014 codified asc topic 606 revenue contracts customers 201602 transition provisions asc topic 606 require public business entity certain specified entities adopt asc topic 606 annual reporting 3 periods beginning december 15 2017 including interim reporting periods within reporting period fn2 entities required adopt asc topic 606 annual reporting periods beginning december 15 2018 interim reporting periods within annual reporting periods beginning december 15 2019 update 201610 april 2016 revenue contracts customers topic 606 identifying performance obligations licensing core principle guidance topic 606 entity recognize revenue depict transfer promised goods services customers amount reflects consideration entity expects entitled exchange goods services achieve core principle entity apply following steps 1 identify contracts customer 2 identify performance obligations contract 3 determine transaction price 4 allocate transaction price performance obligations contract 5 recognize revenue entity satisfies performance obligation amendments update change core principle guidance topic 606 rather amendments update clarify following two aspects topic 606 identifying performance obligations licensing implementation guidance retaining related principles areas company either evaluated currently evaluating implications pronouncements possible impact may company’s financial statements cases management determined implementation pronouncements would material impact financial statements taken whole note 3 loans receivable loans receivable consist following june 30 2019 2018 note 4 assets comprise following june 30 2019 2018 investments june 30 2019 consist 5000 investment aquarius power inc renewable energy technology company’s marketable securities classified availableforsale carried fair value securities comprised shares common stock investee securities classified availableforsale may sold response changes interest rates liquidity needs purposes investment marketable securities represents less twenty percent 20 outstanding common stock equivalents investee security nationally quoted national association securities dealers otc bulletin board “otcbb” otc markets investment accounted accordance provisions sfas 115 marketable securities owned company classified available sale june 30 2019 consisted 905000 shares myson group inc formerly vanguard mining corporation 292050000 shares sports pouch beverage company public companies traded otc markets trading symbols mysn spbv respectively fair value marketable securities recorded june 30 2019 213485 company wrote 32900106 shares myson group inc worthless june 30 2019 fiscal year ended june 30 2018 transfer securities level 3 level 2 note 6 property equipment june 30 2019 company property equipment june 30 2012 company recognized businesses phi gold corp formerly phi mining corporation providential vietnam ltd phi energy corp philand ranch ltd united kingdom corporation together whollyowned subsidiaries philand corporation usa philand ranch ltd singapore philand vietnam ltd discontinued operations practical business accounting purposes june 30 2018 company balance 1255037 longterm liabilities discontinued operations consisting 954337 philand ranch ltd 215000 preferred stock providential holdings inc former subsidiary company 85700 contingency liabilities june 30 2019 company derecognized extinguished amounts balance sheet pursuant statutory limit note 8 current liabilities current liabilities company consist followings june 30 2019 2018 accrued expenses accrued expenses june 30 2019 consist 1237651 accrued salaries 1151949 accrued interest shortterm notes payable net notes payable consist 331700 shortterm notes payable 437725 convertible promissory notes minus 163822 discount advances customers company recorded 438000 advances customers reserve 288219 consulting fees previously received client 149781 accrued interest company able complete consulting services due client’s inability provide gaapcompliant audited financial statements order file registration statement securities exchange commission subfund obilgations fiscal year ended june 30 2019 company received 800000 european plastic joint stock company towards expenses capitalization setting energy subfund 466634 saigon pho palace joint stock company towards expenses capitalization setting real estate subfund respectively master philux global funds company recorded amounts liabilities subfunds set activated time subfund participants receive 49 general partners’ portion ownership relevant subfunds total contribution 2000000 note 9 longterm liabilities fy ended june 30 2019 company reclassified longterm liabilities current liabilities june 30 2018 longterm liabilities consist demand promissory note fiscal year ended june 30 2018 balance 240485000 demand promissory note owed rush gold royalty inc wyoming corporation connection acquisition 51 ownership twentyone mining claims area approximately 400 acres granite mining district grant county oregon usa american pacific resources inc subsidiary company june 30 2019 company derecognized balance said promissory note new independent valuation report mining claims completed extinguishment liabilties discontinued operations june 30 2019 company extinguished 1040037 previously reserved connection potential contingent liabilities concerning discontinued operations phi gold corp formerly phi mining corporation providential vietnam ltd phi energy corp philand ranch ltd united kingdom corporation together whollyowned subsidiaries philand corporation usa philand ranch ltd singapore philand vietnam ltd since june 30 2012 215000 preferred stock providential securities inc previous subsidiary company discontinued year 2000 note 10 due officers directors due officer represents loans advances made officers directors company subsidiaries unsecured due demand june 30 2019 2018 balances 528517 233577 respectively note 11 loans promissory notes short term notes payable course business company obtained shortterm loans individuals institutional investors time raised money issuing restricted common stock company auspices rule 144 june 30 2019 company 331700 shortterm notes payable 1151460 accrued unpaid interest notes bear interest rates ranging 0 36 per annum convertible promissory notes june 30 2019 principal balance outstanding convertible notes 437725 total discount 163822 total derivative liabilities 1307421 company relies professional thirdparty valuation record value derivative liabilities discounts changes fair value derivatives connection convertible notes warrants related convertible notes company intends repay notes cash much practical note 12 litigation extinguishment settled litigations june 30 2019 company extinguished 172091 connection case 00cc13067 filed orange county superior court ca october 31 2000 alleged breach contract damages sum 75000 plus prejudgment interest costs incurred connection complaint relief without admitting denying allegations company reached settlement agreement claimants paid 2500 agreed entry judgment 79000 june 30 2018 company accrued 172091 potential liabilities connection case decided extinguish amount june 30 2019 light time lapsed since inception case absence action claimants june 30 2019 company extinguished 90000 connection case bc 426831 filed superior court state california county los angeles november 24 2009 william davidson martin doan henry fahman benjamin tran hrciti corporation providential capital inc collectively referred “defendants” july 09 2012 william davidson phi capital holdings inc formerly providential capital inc subsidiary company reached settlement agreement whereby phi capital agreed pay william davidson total 200000 period nineteen months beginning september 1 2012 since november 30 2012 william davidson converted portions total amount common stock phi group inc lieu cash payment june 30 2018 company accrued 90000 required liability associated balance case decided extinguish amount june 30 2019 light time lapsed since inception case absence action william davidson note 13 payroll tax liabilities payroll liabilities accrued recorded accrued expenses consolidated balance sheet fiscal year ended june 30 2014 company paid 4197422 internal revenue service 1928994 state california employment development department towards balance 118399 payroll tax penalties interest claimed agencies company resolved remaining balances internal revenue service state california employment department june 30 2019 march 05 2021 total balance recently notified internal revenue service estimated 4704 note 14 basic diluted net loss per share net loss per share calculated accordance sfas 128 “earnings per share” provision sfas 128 basic net loss per share computed dividing net loss period weightedaverage number common shares outstanding period diluted eps based weightedaverage number shares common stock outstanding period common stock equivalents outstanding end period basic diluted weighted average numbers shares year ended june 30 2019 since inclusion common stock equivalents antidilutive note 15 stockholder’s equity june 30 2019 total number authorized capital stock company shares par value 0001 per share consisting 30500000000 shares voting common stock par value 0001 per share 500000000 shares preferred stock par value 0001 per share rights terms associated preferred stock determined board directors company treasury stock balance treasury stock june 30 2019 487767 shares valued 44170 based cost basis common stock fiscal year ended june 30 2019 company issued following amounts common stock june 30 2019 10009756808 shares company’s common stock issued outstanding preferred stock company filed certificates designation amendments certificate designation nevada secretary state designate company’s authorized preferred stock june 30 2019 designations company’s preferred stock follows class preferred stock designations amounts dividends 1 class series cumulative convertible redeemable preferred stock designation twenty million 20000000 shares authorized 500000000 shares preferred stock par value 0001 per share designated class series cumulative convertible redeemable preferred stock b number shares number shares class series preferred stock authorized shall twenty million 20000000 shares c dividends holder class series preferred stock entitled receive ten percent 10 noncompounding cumulative dividends per annum payable semiannually 2 class series ii cumulative convertible redeemable preferred stock designation twentyfive million 25000000 shares authorized 500000000 shares preferred stock par value 0001 per share designated class series ii cumulative convertible redeemable preferred stock “class series ii preferred stock” b number shares number shares class series ii preferred stock authorized shall twentyfive million 25000000 shares c dividends holder class series ii preferred stock entitled receive eight percent 8 cumulative dividends per annum payable semiannually 3 class series iii cumulative convertible redeemable preferred stock designation fifty million 50000000 shares authorized 500000000 shares preferred stock par value 0001 per share designated class series iii cumulative convertible redeemable preferred stock “class series iii preferred stock” b number shares number shares class series iii preferred stock authorized shall fifty million 50000000 shares c dividends holder class series iii preferred stock entitled receive eight percent 8 cumulative dividends per annum payable semiannually ii conversion 1 conversion series andor series ii class preferred stock common stock phi group inc share class preferred stock either series ii shall convertible company’s common stock time two years date issuance variable conversion price defined herein common stock “variable conversion price” shall mean 75 multiplied market price defined herein representing discount rate 25 “market price” means average trading price company’s common stock ten 10 tradingday period ending one trading day prior date conversion notice sent holder class preferred stock company via facsimile email “conversion date” “trading price” means security date closing price otc markets otcqb nasdaq stock markets applicable trading market reported reliable reporting service “reporting service” mutually acceptable company holder class preferred stock 2 conversion series andor series ii class preferred stock common stock subsidiary phi group inc’s alternatively share class preferred stock either series ii may convertible common stock subsidiary phi group inc’s determined company’s board directors time subsidiary become fullyreporting publicly traded company least three months variable conversion price defined herein variable conversion price used connection conversion common stock subsidiary phi group inc’s shall mean 50 multiplied market price defined herein representing discount rate 50 common stock “market price” means average trading price common stock said subsidiary phi group inc’s ten 10 tradingday period ending one trading day prior date conversion notice sent holder preferred stock company via facsimile email “conversion date” “trading price” means security date closing price otc markets otcqb nasdaq stock markets nyse applicable trading market reported reliable reporting service “reporting service” mutually acceptable company said subsidiary holder class preferred stock” 3 conversion class series iii preferred stock phi group inc common stock american pacific plastics inc subsidiary phi group inc’s entire class series iii preferred stock phi group inc ie fifty million 50000000 shares may convertible eighty percent 80 american pacific plastics inc’s common stock issued outstanding immediately conversion exchange pro rata basis 4 conversion shares amount shares common stock phi group inc alternatively subsidiary phi group inc’s received holder time conversion class series ii preferred stock phi group inc based following formula cs common shares phi group inc amount cs oip aud alternatively subsidiary phi group inc’s vcp oip original issue price class series ii preferred stock phi group inc aud accrued unpaid dividends vcp variable conversion price phi common stock subsidiary phi group inc’s defined iii redemption rights corporation period two years date issuance may time redeem class preferred stock either series ii series iii whole part option company’s board directors price equal one hundred twenty percent 120 original purchase price class preferred stock unit consisting shares class preferred stock warrants attached thereto plus case accumulated unpaid dividends date fixed redemption iv liquidation upon occurrence liquidation event defined holders class preferred stock entitled receive net assets pro rata basis used herein “liquidation event” means liquidation dissolution windingup whether voluntary involuntary corporation ii purchase redemption corporation shares class stock merger consolidation corporation corporations unless holders class preferred stock receive securities surviving corporation substantially similar rights class preferred stock stockholders corporation immediately prior transaction holders least majority voting securities successor corporation immediately thereafter “permitted merger” unless holders shares class preferred stock elect otherwise b sale license lease substantially material part corporation’s assets unless holders class preferred stock elect otherwise v rank shares class preferred stock shall rank senior corporation’s common stock class series capital stock corporation hereafter created ii pari passu class series capital stock corporation hereafter created specifically ranking terms par class preferred stock iii junior class series capital stock corporation hereafter created specifically ranking terms senior class preferred stock case distribution assets upon liquidation dissolution winding corporation whether voluntary involuntary vi voting rights 1 class series ii iii preferred stock phi group inc shall voting rights vii protection provisions long shares class preferred stock outstanding corporation shall without first obtaining majority written consent holders class preferred stock alter change rights preferences privileges class preferred stock affect adversely holders class preferred stock viii miscellaneous status redeemed stock case shares class preferred stock shall redeemed otherwise repurchased reacquired shares redeemed repurchased reacquired shall resume status authorized unissued shares preferred stock shall longer designated class preferred stock b lost stolen certificates upon receipt corporation evidence loss theft destruction mutilation preferred stock certificates ii case loss theft destruction indemnity bond security reasonably satisfactory corporation case mutilation preferred stock certificates surrendered cancellation corporation shall execute deliver new preferred stock certificates however corporation shall obligated reissue lost stolen destroyed mutilated preferred stock certificates holder class preferred stock contemporaneously requests corporation convert holder’s class preferred stock common stock c waiver notwithstanding provision certificate designation contrary provision contained herein right holders class preferred granted hereunder may waived shares class preferred stock holders thereof upon majority written consent holders class preferred stock notices required permitted given terms hereof shall sent certified registered mail return receipt requested delivered personally nationally recognized overnight carrier confirmed facsimile transmission shall effective five 5 days placed mail mailed upon receipt refusal receipt delivered personally nationally recognized overnight carrier confirmed facsimile transmission case addressed party set forth address telephone fax number may designated writing hereafter manner set forth section corporation phi group inc vegas drive 237 las vegas nv 89108 telephone 7024755430 facsimile 7024728556 holders class preferred stock address listed corporation’s books records class b preferred stock class b series preferred stock designation two hundred thousand shares authorized 500000000 shares preferred stock par value 0001 per share designated class b series preferred stock b number shares number shares class b series preferred stock authorized two hundred thousand shares c dividend none voting rights except provided law shares class b series preferred stock shall right vote act matters holders common stock right vote act holders shares class b series shall entitled notice stockholders’ meeting action matters basis holders common stock holders common stock shares class b series shall vote together act together thereon single class matters provided voting action one share class b series shall entitled one hundred thousand votes june 30 2019 following amounts preferred stock issued outstanding class series ii preferred stock 10000000 shares class b series preferred stock 120000 shares amendments articles incorporation october 29 2018 certificate amendment articles incorporation phi group inc filed nevada secretary state amend article v articles incorporation change authorized capital stock corporation 3000000000 shares par value 0001 per share consisting 2800000000 shares voting common stock par value 0001 per share 200000000 shares preferred stock par value 0001 per share rights terms associated shares preferred stock determined board directors corporation november 08 2018 certificate amendment articles incorporation phi group inc filed nevada secretary state amend article v articles incorporation change authorized capital stock corporation 4000000000 shares par value 0001 per share consisting 3800000000 shares voting common stock par value 0001 per share 200000000 shares preferred stock par value 0001 per share rights terms associated shares preferred stock determined board directors corporation november 27 2018 certificate amendment articles incorporation phi group inc filed nevada secretary state amend article v articles incorporation change authorized capital stock corporation 5000000000 shares par value 0001 per share consisting 4800000000 shares voting common stock par value 0001 per share 200000000 shares preferred stock par value 0001 per share rights terms associated shares preferred stock determined board directors corporation january 03 2019 certificate amendment articles incorporation phi group inc filed nevada secretary state amend article v articles incorporation change authorized capital stock corporation 7000000000 shares par value 0001 per share consisting 6900000000 shares voting common stock par value 0001 per share 100000000 shares preferred stock par value 0001 per share rights terms associated shares preferred stock determined board directors corporation february 19 2019 certificate amendment articles incorporation phi group inc filed nevada secretary state amend article v articles incorporation change authorized capital stock corporation ten billion shares par value 0001 per share consisting 98 billion shares voting common stock par value 0001 per share 200000000 shares preferred stock par value 0001 per share rights terms associated shares preferred stock determined board directors corporation february 27 2019 certificate amendment articles incorporation phi group inc filed nevada secretary state amend article v articles incorporation change authorized capital stock corporation fifteen billion shares par value 0001 per share consisting 148 billion shares voting common stock par value 0001 per share 200000000 shares preferred stock par value 0001 per share rights terms associated shares preferred stock determined board directors corporation march 29 2019 certificate amendment articles incorporation phi group inc filed nevada secretary state amend article v articles incorporation change authorized capital stock corporation thirtyone billion shares par value 0001 per share consisting 305 billion shares voting common stock par value 0001 per share 500000000 shares preferred stock par value 0001 per share rights terms associated shares preferred stock determined board directors corporation domestication state wyoming september 20 2017 company applied certificate domestication filed articles domestication office secretary state wyoming redomicile company’s jurisdiction state wyoming september 20 2017 company filed articles amendment wyoming secretary state amend authorized capital company follows “the total number shares authorized capital stock corporation divided one billion shares consisting nine hundred million shares voting common stock par value 0001 per share fifty million shares nonvoting class series preferred stock par value 500 per share twentyfive million shares nonvoting class series ii preferred stock par value 500 per share twenty million shares nonvoting class series iii preferred stock par value 500 per share five million shares voting class series iv preferred stock par value 500 per share relative rights preferences limitations restrictions associated aforementioned shares class preferred stock determined board directors corporation” june 25 2020 company filed articles amendment wyoming secretary state amend authorized capital company follows total authorized capital forty billion shares common stock par value 0001 per share five hundred million shares preferred stock par value 0001 per share rights terms associated shares preferred stock determined board directors corporation company continued operate nevada corporation june 30 2020 note 16 stockbased compensation plans february march 18 2015 company adopted employee benefit plan set aside 1000000 shares common stock eligible employees independent contractors company subsidiaries june 30 2019 company issued stock lieu cash plan september 23 2016 company issued incentive stock options nonqualified stock options certain key employees henry fahman ceocfo directors tam bui henry fahman frank hawkins constitute board directors deferred compensation options allow holders acquire company’s common stock fair exercise price company’s common stock grant date option 024 per share based 10days’ volumeweighted average price prior grant date number options equal total 6520000 options terminate seven years date grant become vested exercisable one year grant date following assumptions used monte carlo analysis doty scott enterprises inc independent valuation firm determine fair value stock options vesting based oneyear cliff grant date annual attrition rates used valuation since ongoing employment condition vesting options fair value company’s stock options issuance valuation date follows note 17 gain loss settlement debts fiscal year ended june 30 2019 gain loss settlement debts compared loss amount 94539 conversions debts common stock company fiscal year ended june 30 2018 note 18 income expense net income expense fiscal year ended june 30 2019 consists following note 19 related party transactions company accrued 210000 salaries president secretary company year ended june 30 2019 note 20 income taxes provision made income tax since company significant net operating loss carry forward june 30 2019 company incurred net operating losses tax purposes approximately 42688547 net operating loss carry forward may used reduce taxable income year 2034 net operating loss carry forwards state california generally available reduce taxable income year 2024 availability company’s net operating loss carryforward subject limitation 50 positive change ownership company’s stock “under section 6501a internal revenue code tax code section 3016501a1a income tax regulations tax regulations irs required assess tax within 3 years tax return filed irs” note 21 contracts commitments business consulancy structuring agency agreement set institutional bank funds luxembourg november 30 2017 company signed agreement structuring agent legal experts set bank fund luxembourg order provide financing company’s clients’ projects reserved alternative investment fund raif established form common funds “fcp” investment companies variable capital “sicav” form legal form sicav fcp restriction terms eligible assets raifs free introduce kind assets financial instruments investment policy according luxembourg law july 12 2013 raifs must entrust assets luxembourg custodian bank safekeeping must appoint approved statutory auditor one distinctive advantages raif may various subfunds corresponding distinct part assets liabilities raif subfunds established raif umbrella target different investment opportunities variety industries desired february 21 2018 company signed amendment business consultancy structuring agency agreement solely responsible costs euros 3500000 associated establishing raif october 4 2018 payment agreement signed structuring agent company calling extra amount euros 1500000 paid structuring agent november 15 2018 master luxembourg raif fund named “philux global funds sca sicav raif” registered activated luxembourg commission de surveillance du secteur financier cssf june 11 2020 registration b244952 acquisition 51 equity interest vinafilms joint stock company august 06 2018 signed business cooperation agreement vinafilms jsc công ty cổ phần màng bao bì tân vinh nam phát vietnamese joint stock company principal business address lot g9 road 9 tan industrial zone duc hoa ha village duc hoa district long province vietnam hereinafter referred “vnf” majority shareholder exchange fiftyone percent ownership vnf preferred stock phi according agreement phi responsible filing s1 registration statement securities exchange commission american pacific plastics inc subsidiary phi holds 51 equity ownership vnf become fullyreporting public company us stock market september 20 2018 stock swap agreement signed ms thi nghieu majority shareholder holding 76 ownership vnf phi exchange 3060000 shares ordinary stock vnf owned ms thi nghieu 50 million shares class series iii cumulative convertible redeemable preferred stock phi though transaction technically closed september 28 2018 company recognize operations vinafilms jsc consolidated financial statements june 30 2019 gaap audit vinafilms jsc financial statements conducted completed pcaobregistered auditing firm note 22 going concern uncertainty shown accompanying consolidated financial statements company accumulated deficit 42688547 total stockholders’ deficit 6002724 june 30 2019 factors well uncertain conditions company faces daytoday operations respect cash flows create uncertainty company’s ability continue going concern financial statements include adjustments might necessary company unable continue going concern management taken action strengthen company’s working capital position generate sufficient cash meet operating needs june 30 2021 beyond note 23 subsequent events financial statements approved management available issuance march 09 2021 subsequent events evaluated date 1 issuances common stock company july 01 2019 march 09 2021 company issued following amounts stock holders convertible promissory notes shareholders 2 establishment activation philux global funds sca sicavraif june 11 2020 company received approval luxembourg commission de surveillance du secteur financier cssf successfully established activated philux global funds sca sicavraif “fund” registration b244952 luxembourg bank fund organized reserved alternative investment fund accordance luxembourg law july 23 2016 relative reserved alternative investment funds law august 23 2016 relative commercial companies modified law july 12 2013 relative alternative investment fund managers following entities engaged support fund’s operations custodian bank hauck aufhauser privatbankiers ag b administrative registrar transfer agent hauck aufhauser alternative investment services sa c fund manager hauck aufhauser fund services sa fund attorneys dlp law firm sarl vci legal e investment advisor philux capital advisors inc f fund auditors ey luxembourg ey vietnam g fund tax advisor atoz tax management luxembourg h fund independent asset valuator cushman wakefield vietnam fund umbrella fund containing one subfund compartments intended invest real estate renewable energy agriculture healthcare especially long thanh multicommodities logistics center lmlc dong nai province vietnam include asia diamond exchange proposed international financial center 3 development asia diamond exchange vietnam along establishment philux global funds since march 2018 company worked closely authority chu lai open economic zone provincial government quang nam vietnam develop asia diamond exchange quang nam provincial government agreed allocate 200 hectares sanctioned freetrade zone near chu lai airport nui thanh district quang nam province central vietnam us set multicommodities center would include asia diamond exchange however better opportunity arose start construction new international airport long thanh district dong nai province near ho chi minh city southern vietnam december 2020 vietnamese central government designated 1200 hectares land bau village long thanh district dong nai province new industrial zone applied 600 hectares close long thanh international airport develop long thanh multicommodities logistics center lmlc house asia diamond exchange proposed international financial center urban area among things 4 agreements consulting service agreement glink apps jsc december 23 2019 phi capital holdings inc subsidiary company name changed philux capital advisors inc effective june 03 2020 signed consulting service agreement provide consulting service glink apps jsc wyoming corporation assist latter become publicly traded company us according agreement glink apps jsc pay phi capital holdings inc 88500 cash five million 5000000 shares common stock consulting service rendered b business cooperation agreement natural well technical ltd april 27 2020 company signed business cooperation agreement natural well technical ltd “nwtl” company organized existing laws republic china engaged research development innovative biotechnologies may significant applications healthcare beauty supply agriculture industry nwtl company agree jointly cooperate research development activities pertinent technologies initiated continue carried nwtl applying produce commercial products services fields healthcare beauty supply agriculture industry case may well business activities deemed mutually beneficial particular nwtl company initially focus following activities developing implementing comprehensive plan increase production marketing sale “super green” high energy drop drink “mistyrious” fine mist spray products large scale worldwide b developing implementing plan increase production marketing sale “super cassava” “uniwash” engine booster products well products related fields agriculture energy studied developed nwtl c continuing conduct research accumulate clinical data nwtl’s biotechnologies order obtain us fda’s approval cancer treatments healthcare products addition parties also develop produce market beauty supply products designing financial plan providing required funding nwtl execute business plan c investment advisory agreement among philux capital advisors inc hauck aufhauser fund services sa philux global funds sca sicavraif june 11 2020 philux capital advisors inc “investment advisor” signed investment advisory agreement among hauck aufhauser fund services sathe “aifm” philux global funds sca sicavraif umbrellafund composed one subfunds “fund” serve investment advisor philux global funds according agreement investment advisor cooperate definition investment strategy implementation advisory capacity develop proposals specific investment policy fund advise support aifm selection investments make investment recommendations carry due diligence process present suitable investments selected consideration investment policy investment restrictions fund provide support conclusion purchase sale transactions observe analyze relevant markets potential investments provide advice support aifm give recommendations event sale investments support investors fund onboarding management granting information fundrelevant issues well channeling answering investor questions support aifm performance risk control completion subscription agreements investment advisor shall receive general partner fund remuneration stated fees annex investment advisory agreement tecco group participation philux infrastructure fund compartment philux global funds august 10 2020 tecco group vietnamese company signed agreement phi luxembourg development sa subsidiary company participate proposed infrastructure fund compartment philux global funds sca sicavraif according agreement tecco group contribute 2000000 49 ownership general partners’ portion said infrastructure fund compartment march 05 2021 tecco group paid four billion vietnam dong vnd towards total agreed amount e agreement phat van hung co ltd participation philux real estate fund compartment philux global funds november 09 2020 phat van hung co ltd signed agreement phi luxembourg development sa subsidiary company participate real estate fund compartment philux global funds sca sicavraif according agreement phat van hung co ltd contribute 2000000 49 ownership general partners’ portion said real estate fund compartment march 05 2021 phat van hung made payment towards agreed amount f agreement xuan quynh llc participation philux infrastructure fund compartment philux global funds november 20 2020 xuan quynh llc vietnamese company signed agreement phi luxembourg development sa subsidiary company participate proposed infrastructure fund compartment philux global funds sca sicavraif according agreement xuan quynh llc contribute 2000000 49 ownership general partners’ portion said infrastructure fund compartment march 05 2021 xuan quynh llc made payment towards agreed amount g investment agreements memorandum understanding august 24 2020 november 11 2020 company luxembourg bank fund mother holding company phi luxembourg development sa philux global funds sca sicavraif signed investment agreements memorandum understanding three nonus entities total investments one billion us dollars however date report company received money investment agreements guarantee money received agreements memorandum understanding future item 9 item 8 financial statements phi group inc report independent registered public accounting firm board directors stockholders phi group inc formerly providential holdings inc audited accompanying consolidated balance sheets phi group inc nevada corporation subsidiaries june 30 2011 related consolidated statements operations stockholders equity cash flows year ended june 30 2011 consolidated financial statements responsibility companys management responsibility express opinion consolidated financial statements based audits audit consolidated financial statements phi group inc subsidiaries year ended june 30 2010 statements reflect total revenues 83990 net loss 3568438 respectively statements audited auditors whose report furnished us statements included explanatory paragraph described substantial doubt company’s ability continue going concern discussed note 20 consolidated financial statements consolidated financial statements phi group inc june 30 2010 restated predecessor auditor reported financial statements restatement conducted audit statements accordance standards public company accounting oversight board united states standards require plan perform audit obtain reasonable assurance whether financial statements free material misstatement company required engaged perform audit internal control financial reporting audit included consideration internal control financial reporting basis designing audit procedures appropriate circumstances purpose expressing opinion effectiveness company’s internal control financial reporting audit includes examining test basis evidence supporting amounts disclosures financial statements audit also includes assessing accounting principles used significant estimates made management well evaluating overall financial statement presentation believe audits provide reasonable basis opinion consolidated financial statements referred present fairly material respects consolidated financial position phi group inc subsidiaries june 30 2011 results consolidated operations cash flows year ended june 30 2011 conformity accounting principles generally accepted united states america companys financial statements prepared using generally accepted accounting principles applicable going concern contemplates realization assets liquidation liabilities normal course business company accumulated deficit 28177788 net loss amounting 1178297 year ended june 30 2011 factors discussed note 22 consolidated financial statements raise substantial doubt companys ability continue going concern managements plans regard matters also described note 22 consolidated financial statements include adjustments might result outcome uncertainties discussed note 24 consolidated financial statements year ended june 30 2010 restated october 05 2011 dave banerjee cpa accountancy corp 6301 owensmouth ave ste 750 woodland hills ca 91367 phi group inc subsidiaries formerly providential holdings inc notes consolidated financial statements note 1 nature business phi group inc phi engaged number business activities scope includes consulting merger acquisition advisory services real estate hospitality development mining natural resources investing special situations company invests various business opportunities within chosen scope business provides financial consultancy advisory services us foreign companies acquires selective target companies special situations create additional value shareholders may 2003 company formed subsidiary name providential capital provide financial products services microsmall cap arenas manage companys proprietary merger acquisition activities subsidiary changed name phi capital holdings inc may 2010 july 7 2003 whollyowned dba providential holdings inc touchlink communications formed provide pointofsale pos terminals prepaid calling cards retailers convenient stores nonprofit organizations across us company later incorporated nevada corporation february 2004 name touchlink communications inc provide long distance services residential business customers united states subsidiary operations years ended june 30 2011 2010 process reorganization become separate publicly traded company phi group inc hold minority interest december 31 2003 company formed providential oil gas inc nevada corporation whollyowned subsidiary pursue independent oil gas business june 14 2006 providential oil gas inc changed name providential energy corporation expand scope business potentially include alternative energy fuel cells biodiesel subsequently subsidiary changed name phi energy corporation entity operations years ended june 30 2011 2010 september 2004 provimex inc formerly majorityowned subsidiary company incorporated nevada corporation september 2004 engage import export business company operations years ended june 30 2011 2010 process reorganization become separate public company phi group inc holds minority interest july 2007 philand corporation nevada corporation wholly owned subsidiary company formed engage real estate development quang nam province vietnam july 2007 phi group inc entered principle agreement people’s committee quang nam province would allow company lease approximately 8000 acres land south hoi city quang nam province vietnam develop integrated tourism zone 70year lease term december 2007 philand corporation formed whollyowned subsidiary philand vietnam ltd limited liability company registered laws socialist republic vietnam manage luxury resort residential community development project chu lai nui thanh district quang nam province “pointe91” april 2007 company formed singaporebased public company limited shares laws republic singapore philand ranch ltd singapore company 200906217g isin sg9999006092 intended publicly traded holding company real estate hospitality development vietnam southeast asia june 2009 company formed philand ranch limited uk company registered laws england wales company 6923797 isin gb00b5461k52 global holding company listed frankfurt stock exchange consolidate real estate hospitality business activities company june 2009 philand ranch limited uk acquired issued outstanding common stock philand corporation exchange 23849800 ordinary shares philand ranch limited uk also exchanged 1000000 shares ordinary stock issued outstanding stock philand ranch ltd singapore result philand ranch limited uk become parent philand corporation philand vietnam ltd philand ranch ltd singapore known phi oil gas ltd phi group inc received 18734753 shares ordinary stock philand ranch limited uk exchange holding philand corporation march 2007 company received 900000 shares biowarm corp nevada corporation advisory services valued 675000 biowarm corp subsequently acquired 100 vietnambased dai dung metallic manufacture construction trade company ddmmct changed name ddc industries inc june 2007 company received 3763753 shares ddc industries’ common stock services performed merger biowarm corp ddmmct closed march 30 2007 year ended june 30 2008 phi group inc received remaining 3763753 shares biowarm corp’s common stock pursuant business consulting agreement biowarm company merger agreement ddmmct rescinded november 18 2008 entirety shareholders ddmmct agreed return 28610025 shares 30110025 issued shares december 1 2008 ddc industries inc changed name phi mining group inc december 31 2010 company’s name changed phi gold corp focus gold mining business march 2008 indochina mining corporation nevada corporation incorporated engage exploitation processing diatomite mines april 14 2008 indochina mining corporation imc entered cooperation agreement phu yen minerals joint stock company pymico agreement pymico imc would cooperate contribute capital establishment joint venture enterprise specializing exploitation processing diatomite phu yen province vietnam imc would acquire maximum 30 shares pymico joint venture materialize may 2008 providential vietnam ltd vietnamese limited liability company whollyowned subsidiary company formed provide advisory services management consulting services subsidiary generate revenue fiscal year ended june 30 2011 december 2008 indochina mining corporation entered stock purchase agreement phi gold corp formerly phi mining group ddc industries inc exchange capital stock number newly issued shares phi gold corp result phi group inc owns approximately 83 phi gold corp october 28 2010 phi gold corporation formerly phi mining group inc signed agreement cchi canadian holdings inc new brunswick corporation canada acquire issued outstanding stock maisy mae mining inc new brunswick corporation canada 100 owned cchi canadian holdings inc purchase price 3500000 payable combination cash marketable securities transaction closed effective april 4 2011 transaction closed issuance shares company’s subsidiary philand ranch limited uk maisy mae mining inc engaged placer mining business yukon territory canada connection mine known maisy mae creek mine april 8 2011 phi energy corporation signed asset purchase agreement pt dian anugrah pratama “dap” indonesia corporation acquire estimated mineable reserve ten million 10000000 metric tons coal located area approximately 423 hectares kecamatan kapur ix kabupaten lima puluh kota propinsi sumatera barat indonesia dap exchange 20000000 shares common stock phi energy corporation subsequently may 10 2011 phi energy signed agreement purchase sale dap superseded replaced prior arrangements understandings dap whereby phi energy corporation buy total estimated mineable reserves thirtythree million 33000000 metric tons coal dap exchange 3000000 cash 47000000 common stock phi energy corporation transaction closed may 31 2011 phi energy corporation agreed file registration statement register 4700000 shares common stock within two months following closing transaction benefits dap phi group inc related shareholders however date report transaction may subject mutual rescission certain terms conditions met parties april 25 2011 phi medical ltd wholly owned subsidiary philand ranch limited uk changed name phi oil gas ltd singapore public company limited shares focus oil gas business april 27 2011 phi oil gas ltd signed business cooperation axn group llc delaware corporation cooperate oil gas activities whereby axn group affiliates 70 phi group 15 philand ranch 15 phi oil gas ltd phi oil gas ltd responsible listing shares singapore stock exchange soon practical later six months following acquisition oil gas properties assets businesses arrangements axng phi group intends continue pursue healthcare initiatives southeast asia strategic alliance announced future june 01 2011 provimex inc “provimex” acquired 100 issued outstanding capital stock humex medical group corp california corporation “humex” exchange solely 58333333 share provimex’s common stock par value 0001 merger shareholders humex owns 70 provimex inc provimex shares registered us securities act 1933 amended “securities act” listed foreign exchange board directors majority shareholders humex approved exchange june 30 2011 business combination completed note 2 summary significant accounting policies principles consolidation consolidated financial statements include accounts phi group inc subsidiaries providential securities inc phi capital holdings inc formerly providential capital inc provimex inc phi energy corporation touchlink communications phi gold corp providential vietnam philand ranch limited uk 100 owned subsidiary philand corporation ltd collectively referred company significant intercompany transactions eliminated consolidation providential securities inc provimex inc touchlink communications inactive use estimates preparation consolidated financial statements conformity accounting principles generally accepted united states america requires management make estimates assumptions affect reported amounts assets liabilities disclosure contingent assets liabilities date financial statements reported amounts revenues expenses reporting period actual results could differ estimates cash equivalents company considers liquid investments maturity three months less date purchase readily convertible cash equivalents marketable securities companys securities classified availableforsale carried fair value securities classified availableforsale may sold response changes interest rates liquidity needs purposes investment marketable securities represents less twenty percent 20 outstanding common stock equivalents investee security nationally quoted national association securities dealers otc bulletin board otcbb pink sheets investment accounted accordance provisions asc 320 previously sfas 115 unrealized holding gains losses availableforsale securities excluded earnings reported separate component stockholders equity realized gains losses securities classified availableforsale reported earnings based upon adjusted cost specific security sold june 30 2011and 2010 marketable securities recorded 174650 000 respectively based upon fair value marketable securities accounts receivable management reviews composition accounts receivable analyzes historical bad debts june 30 2011 company balance 6000 accounts receivable impairment longlived assets effective january 1 2002 company adopted asc 350 previously sfas 144 accounting impairment disposal longlived assets addresses financial accounting reporting impairment disposal longlived assets supersedes sfas 121 accounting impairment longlived assets longlived assets disposed accounting reporting provisions apb opinion 30 reporting results operations disposal segment business company periodically evaluates carrying value longlived assets held used accordance asc 350 asc 350 requires impairment losses recorded longlived assets used operations indicators impairment present undiscounted cash flows estimated generated assets less assets carrying amounts event loss recognized based amount carrying amount exceeds fair market value longlived assets loss longlived assets disposed determined similar manner except fair market values reduced cost disposal property equipment property equipment stated cost maintenance repair costs charged expense incurred costs major additions betterments capitalized property equipment sold otherwise disposed cost related accumulated depreciation eliminated accounts resulting gain loss reflected income depreciation computed using straightline method estimated useful lives assets ranging three ten years depreciation amortization cost property equipment depreciated estimated useful lives related assets depreciation amortization fixed assets computed straightline basis net earnings per share company adopted provisions asc 260 previously sfas 128 asc 260 eliminates presentation primary fully diluted earnings per share eps requires presentation basic diluted eps basic eps computed dividing income loss available common stockholders weightedaverage number common shares outstanding period diluted eps based weightedaverage number shares common stock outstanding period common stock equivalents outstanding end period company following dilutive stock warrants june 30 2011 2010 warrants 250000 total 250000 net earnings per share computed follows 2010 restated basic diluted net loss per share numerator net incomeloss 1178297 3568438 denominator basic weighted average number common shares outstanding 202343447 196619950 basic net income loss per share 001 002 diluted weighted average number common shares outstanding 202343447 196619950 diluted net income loss per share 001 002 stockbased compensation effective july 1 2006 company adopted asc 7181025 previously sfas 123r accordingly adopted modified prospective application method asc 7181025 applied new awards modified repurchased cancelled effective date additionally compensation cost portion awards outstanding date adoption requisite service rendered unvested options recognized period time remaining requisite services rendered fair value financial instruments effective july 1 2008 company adopted asc 820 previously sfas 157 fair value measurements adopted statement assets liabilities shown table asc 820 clarifies definition fair value prescribes methods measuring fair value establishes fair value hierarchy based inputs used measure fair value expands disclosures use fair value measurements adoption asc 820 material impact fair value measurements asc 820 permits company defer recognition measurement nonfinancial assets nonfinancial liabilities january 1 2010 june 30 2011 company nonfinancial assets nonfinancial liabilities recognized disclosed fair value asc 820 requires financial assets liabilities reported fair value categorized one following types investments based upon methodology determining fair value level 1 quoted prices active markets identical assets liabilities level 2 observable inputs level 1 prices quoted prices similar assets liabilities quoted prices markets active inputs observable corroborated observable market data substantially full term assets liabilities level 3 unobservable inputs supported little market activity significant fair value assets liabilities company utilizes various approaches measure fair value availableforsale securities assets measured fair value recurring basis summarized company financial liabilities measured fair value recurring basis availableforsale securities level 1 level 2 level 3 total june 30 2011 174650 june 30 2010 0 company uses various approaches measure fair value availableforsale securities applying threelevel valuation hierarchy disclosures specified asc 820 level 1 securities measured using quoted prices active markets identical assets liabilities phi group inc received 3500000 shares vietnam united steel corporation vusc consulting services provided year ended june 30 2009 shares constituted 20 ownership vusc valued 1750000 considered management level 3 valuation hierarchy due share’s little market activity shares valued using undiscounted cash flow method based audited financial statements year ended december 31 2007 vusc projected cash flow three consecutive fiscal periods calculated conservative increase 20 per year addition cash flow projection company also discounted quoted market price 50 market price time completion services provided management believed time completion transaction fair value approximately 050share time however june 30 2010 management permanently impaired 1750000 3500000 shares vietnam united steel corporation due company’s lack financial disclosure trading activity company’s policy regarding transfers andor level 3 depends trading activity security volatility security observable units clearly represents fair value security level 3 security measured using fairly represented fair value transfer security either level 1 level 2 depending type inputs revenue recognition companys revenue recognition policies compliance asc 13 previously staff accounting bulletin sab 104 company recognizes consulting advisory fee revenues transaction completed service fees earned expenses recognized period corresponding liability incurred payments received relevant criteria revenue recognition recorded unearned revenue advertising company expenses advertising costs incurred advertising costs years ended june 30 2011 2010 4346 1910 respectively comprehensive income loss asc 2201045 previously sfas 130 reporting comprehensive income establishes standards reporting display comprehensive income components accumulated balances comprehensive income defined include changes equity except resulting investments owners distributions owners among disclosures sfas 130 requires items required recognized current accounting standards components comprehensive income reported financial statement displayed prominence financial statements june 30 2011 2010 respectively comprehensive income loss presented accompanying consolidated balance sheets income taxes company accounts income taxes accordance asc 740 previously sfas 109 accounting income taxes deferred taxes provided liability method whereby deferred tax assets recognized deductible temporary differences deferred tax liabilities recognized taxable temporary differences temporary differences reported amounts assets liabilities tax bases deferred tax assets reduced valuation allowance opinion management likely portion deferred tax assets realized deferred tax assets liabilities adjusted effects changes tax laws rates date enactment reporting segments asc 280 previously statement financial accounting standards 131 disclosures segments enterprise related information supersedes statement financial accounting standards 14 financial reporting segments business enterprise establishes standards way public enterprises report information operating segments annual financial statements requires reporting selected information operating segments interim financial statements regarding products services geographic areas major customers asc 280 defines operating segments components enterprise separate financial information available evaluated regularly chief operating decision maker deciding allocate resources assessing performance company operated one segment generated revenues years ended june 30 2011 2010 risks uncertainties normal course business company subject certain risks uncertainties company provides service receives marketable securities upon execution transactions consequently value securities received customers affected economic fluctuations customers business growth actual realized value securities could significantly different recorded value recent accounting pronouncements april 2010 fasb issued accounting standards update 201013 asu 201013 compensation stock compensation topic 718 update provides amendments topic 718 clarify employee sharebased payment award exercise price denominated currency market substantial portion entitys equity securities trades considered contain condition market performance service condition therefore entity would classify award liability otherwise qualifies equity amendments asu 201013 effective fiscal years interim periods within fiscal years beginning december 15 2010 provisions asu 201013 expected material effect companys consolidated financial statements july 2010 fasb issued accounting update provide guidance enhance disclosures related credit quality companys financing receivables portfolio associated allowance credit losses pursuant accounting update company required provide greater level disaggregated information allowance credit loss objective facilitating users evaluation nature credit risk inherent companys portfolio financing receivables risk analyzed assessed arriving allowance credit losses changes reasons changes allowance credit losses revised disclosures end reporting period effective company beginning second quarter fiscal 2011 revised discourses related activities reporting period effective company beginning third quarter fiscal 2011 company currently evaluating impact accounting update financial disclosures note 3 nasd examination discontinuance providential securities inc completion routine audit providential securities inc providential july august 2000 national association securities dealers inc alleged providential violated certain provisions nasds conduct rules 2120 2330 2110 3010 rules 15c24 10b5 10b9 15c33 securities exchange commission providential securities inc henry fahman voluntarily submitted letter acceptance waiver consent awc accepted nasd regulation inc october 27 2000 providential securities inc censured fined 11500000 required offer rescission public customers participated providential private placement addition henry fahman banned capacities associating nasd member based upon abovementioned circumstances providential securities inc withdrew membership nasd october 2000 ceased securities brokerage operation fine 115000 included accrued expenses accompanying consolidated financial statements company offered preferred stock holders rescission investment year ended june 30 2004 235000 amount due preferred stock holders plus 105600 related dividends payable totaling 340600 paid either cash issuance common stock balance unredeemed preferred shares related interest included current liabilities accompanying consolidated financial statements note 13 note 4 loans receivable related parties loans receivable related parties consist following june 30 2011 2010 loan cavico corp catalyst resource group 2020 loan catthai corp total 200 2120 note 5 current assets comprise following june 30 2011 2010 advance shares purchase 780 prepaid 2697 total 780 note 6 marketable equity securities available sale company’s marketable securities classified availableforsale carried fair value securities comprised shares common stock investee securities classified availableforsale may sold response changes interest rates liquidity needs purposes investment marketable securities represents less twenty percent 20 outstanding common stock equivalents investee security nationally quoted national association securities dealers otc bulletin board otcbb pink sheets investment accounted accordance provisions sfas 115 marketable securities classified available sale consisted 1746500 shares vietnam mining corporation earned consulting services rendered fair value shares received 174650 june 30 2011 note 7 property equipment property equipment june 30 2011 2010 consists following equipment 84853 89691 furniture fixtures 69953 59115 automobiles 58000 subtotal 206806 less accumulated depreciation 205034 202290 total net fixed assets 1771 4516 depreciation expenses 2745 19233 fiscal years ended june 30 2011 2010 respectively note 8 assets quarter ended march 31 2011 philand vietnam ltd wholly owned subsidiary philand ranch ltd made security deposit amount 172203 chu lai open economic zone authority quang nam province vietnam guarantee pointe91 development project bien rang chu lai nui thanh district quang nam province vietnam quarter ended june 30 2011 company signed consulting agreement assist agent155 media corp delaware corporation respect corporate restructuring business combination freshwater technologies inc nevada corporation part restructuring requirements company made payment manning elliot llp amount 24476 behalf freshwater technologies inc facilitate transaction agent155 media corp freshwater technologies inc note 9 construction progress sfas 34 “capitalization interest” establishes standards capitalizing interest cost part historical cost acquiring certain assets qualify interest capitalization assets must require period time get ready intended use example asset enterprise constructs use lease constructed discrete project real estate projects interest capitalization required assets effect compared effect expensing interest material interest cost eligible capitalization shall interest cost recognized borrowings obligations construction progress represents costs incurred philand corporation subsidiary company real estate development amounting 1153632 june 30 2011 costs included interest capitalized 456400 note 10 accounts payable accrued expenses accounts payable accrued expenses june 30 2011 2010 consist following accounts payable accrued expenses 1386164 1462010 accrued salaries payroll taxes 429544 292519 accrued interest 2165264 1267207 accrued legal 385084 accrued consulting fees 173890 177981 total 4451136 3584801 note 11 due officer due officer represents advances made officers company subsidiaries noninterest bearing except 100000 described unsecured due demand june 30 2011 2010 balances 1317949 1126529 respectively june 30 2011 company short term note payable amounting 100000 interest bearing 3000 per month payable member board directors note 12 loans promissory notes short term notes payable june 30 2011 june 30 2010 company short term notes payable amounting 2432456 2400546 accrued interest 1872479 1367980 respectively notes bear interest rates ranging 6 36 per annum 1744982 short term notes past due 258976 due demand notes payable secured assets company summarized convertible promissory note issued asher enterprises inc “asher” may 10 2010 50000 net discount 18500 convertible note due payable february 14 2011 interest 8 per annum note convertible election asher time issuance date event default amount principal interest paid due bear interest rate 22 per annum note becomes immediately due payable occur company liable pay asher 150 outstanding principal interest note agreement contains covenants requiring asher’s written consent certain activities existence committed company issuance date note follows dividend distributions cash shares stock repurchases borrowings sale assets certain advances loans excess 50000 certain guarantees thirdparty liabilities outstanding note principal interest accrued thereon converted whole part time asher issuance date equivalent company’s common stock determined 65 average three lowest closing trading prices company’s common stock ten trading days prior date conversion notice sent asher third quarter remaining 32000 principal convertible notes issued may 10 2010 converted 4638760 shares january 24 2011 company issued second convertible promissory note asher 55000 similar terms conditions value derivative liability june 30 2011 97049 due preferred stockholders company classified 215000 preferred stock subscribed current liability payable holders preferred stock due non compliance preferred shares subscription agreement amount past due june 30 2011 interest payable holders preferred stock 284255 258455 included accrued interest included account payable accrued expenses balance sheets june 30 2011 june 30 2010 respectively unearned revenue unearned revenue 293219 consulting fee service performed company completed june 30 2011 current liabilities current liabilities 30000 june 30 2011 represent refundable deposit connection consulting agreement company client amounts shown current liabilities consolidated financial statements note 13 litigation legal proceeding settled unpaid june 30 2011 quang van cao nhan thi nguyen cao vs providential securities inc et al case originally submitted orange county superior court ca june 25 1997 case 781121 subsequently moved nasd dispute resolution arbitration august 24 2000 companys legal counsel negotiated claimants counsel unilaterally reached settlement approved company process renegotiating terms said settlement claimants filed request arbitration hearing national association securities dealers october 4 2000 case 9903160 thereafter claimants filed complaint orange county superior court ca october 31 2000 case 00cc13067 alleged breach contract damages sum 75000 plus prejudgment interest costs incurred connection complaint relief without admitting denying allegations company reached settlement agreement claimants whereby company would pay claimants total 62500 plus 4500 administrative costs date report company paid 2500 subject entry judgment 79000 may 2011 claimants filed application renewal judgment total 14049078 amount accrued accompanying consolidated financial statements conseco finance vendor services corporation fka green tree vendor services corporation vs providential securities inc henry fahman tina phan september 1997 providential securities inc entered written lease agreement lease certain items equipment green tree vendor services return providential securities inc agreed pay thirtysix monthly installments amount 1552 september 12 2000 subsequently providential securities inc unable make monthly payments claimant due lack revenues following interruption subsequent closure securities brokerage operations see note 3 claimant filed complaint money superior court state california county orange case 01cc02613 february 23 2001 seeking 39102 plus interest thereon legal rate september 12 2000 claimant entered judgment providential securities inc henry fahman tina phan 48933 judgment amount accrued accompanying consolidated financial statements pending litigation ngon vu vs providential securities inc claimant former employee providential securities inc laid 2000 due closure business claimant complained department industrial relations dir allegedly unpaid vacation salaries june 13 2001 dir filed request enter judgment providential securities inc 9074 including wages interest penalty post hearing filing fee sought amount 9074 accrued accompanying consolidated financial statements verio vs providential securities inc april 1 2003 verio inc filed judgment providential securities inc whollyowned subsidiary company discontinued october 2000 total 9141 sum consists 6800 services allegedly rendered verio inc providential securities inc 2000 2341 legal costs amounts accrued accompanying consolidated financial statements dow jones company inc vs providential securities inc phi group inc march 19 2002 dow jones company filed complaint superior court california county orange west justice center case 02wl1633 providential securities inc discontinued operations company phi group inc 9973 plus prejudgment interest rate ten 10 per annum november 1 2000 reasonable attorneys’ fees relief claim connection services allegedly rendered plaintiff providential securities inc prior november 2000 company intends settle case sought amount 9973 excluding interest accrued expenses accompanying consolidated financial statements key equipment finance inc vs 496215601204 providential securities inc henry fahman tina phan case 06wl00289 january 18 2006 key equipment finance filed suit superior court state california county orange west district claiming breach terms lease agreement failure make monthly installment due although demand therefore made remaining balance due owing plaintiff lease 14439 plus interest date default plaintiff also claiming breach guaranty common counts unjust enrichment cost law suit relief court may deem proper amount 14439 accrued accompanying consolidated financial statements june 30 2011 davidson vs doan et al february 01 2010 company notified suit filed superior court state california county los angeles november 24 2009 william davidson individual martin doan henry fahman hrciti corporation providential capital inc collectively referred “defendants” case bc 426831 plaintiff demanded amount less 14000000 defendants promissory notes outstanding plaintiff company accrued potential liabilities associated promissory notes accompanying consolidated financial statements june 30 2011 nasd case completion routine audit providential securities inc july august 2000 national association securities dealers inc alleged providential violated certain provisions nasds conduct rules result providential securities inc withdrew membership nasd october 2000 ceased securities brokerage operation 127305 including 115000 fine charged nasd included accrued expenses accompanying consolidated financial statements note 3 arbitration cases company four arbitration cases daytraders providential securities inc discontinued stock brokerage operation company total amount damages cases closed june 30 2001 54505 amount accrued accompanying consolidated financial statements note 14 payroll liabilities payroll liabilities accrued recorded accrued expenses consolidated balance sheet june 30 2011 company owed internal revenue service state california employment development department payroll tax penalties interest amounting 101820 note 15 basic diluted net loss per share net loss per share calculated accordance sfas 128 earnings per share provision sfas 128 basic net loss per share computed dividing net loss period weightedaverage number common shares outstanding period diluted eps based weightedaverage number shares common stock outstanding period common stock equivalents outstanding end period basic diluted weighted average numbers shares year ended june 30 2011 since inclusion common stock equivalents antidilutive note 16 stockholders equity effective april 13 2009 company amended articles incorporation change par values preferred common stock 0001 company 400000000 authorized capital stock consisting 300000000 shares common stock 100000000 shares preferred stock effect change reflected retroactively consolidated financial statements treasury stock balance treasury stock june 30 2011 1330440 shares valued par 1330 common stock year ended june 30 2011 company issued 14600395 shares common stock valued 529206 settlement asher enterprise convertible promissory notes shares issued 06092006 luberski inc transferred subsequently sold 1000000 shares common stock phi group inc belonged officer company given luberski inc collateral loan june 30 2007 company agreed pay back 1000000 shares valued 57000 officer recorded transaction shares issued prepaid consulting year ended june 30 2010 company signed consulting agreement consulting service one year company issued 200000 shares common stock consultant valued 10000 based upon market value stock date stock issuance company amortized 5000 year ended june 30 2011and 2010 note 17 stock based compensation plan stockbased compensation february 7 2005 company adopted stockbased compensation plan set aside 14000000 shares common stock selected eligible participants company subsidiaries certain independent contractors providing certain services company prior july 1 2006 company measured stock compensation expense using intrinsic value method accounting accordance accounting principles board apb opinion 25 accounting stock issued employees related interpretations apb 25 company adopted sfas 123r effective july 1 2006 using modified prospective method warrants quarter ended september 30 2006 company issued 250000 stock warrants term 5 years three year vesting period following assumptions used blackscholes pricing model riskfree interest rate 464 expected life 500 years expected volatility 198 expected dividend yield 0 following summary warrant activity year ended june 30 2011 warrants outstanding exercise price aggregate intrinsic value outstanding june 30 2010 250000 0015 3000 granted forfeited exercised outstanding june 30 2011 250000 0015 3000 following summary status warrants outstanding june 30 2011 exercise price total warrants outstanding remaining life years total exercise price warrants exercisable exercise price 0015 250000 0015 250000 0015 note 18 loss settlement debts company settled notes payable principal related accrued interest asher enterprise inc mr lukasik totaling 99574 issuance 14600295 shares common stock fair value 529206 50960 shares subsidiary fair value 15768 result company recorded loss 402107 settlement debts june 30 2011 period prior year company recorded loss 2701 settlement debts note 19 related party transactions company accrued 210000 salaries henry fahman president company tina phan secretary company years ended june 30 2011 june 30 2010 revenues company generated phi group parent company provides consulting services clients revenues considered earned services deemed complete company receives consideration consulting services provided either cash andor common stock client company revenues earned company’s subsidiaries periods income statements presented period ended june 30 2011 company earned following revenues period ended june 30 2010 company earned following revenues note 20 income taxes provision made income tax since company significant net operating loss carry forward june 30 2011 company incurred net operating losses tax purposes approximately 239 million net operating loss carry forward may used reduce taxable income year 2030 net operating loss carry forwards state california generally available reduce taxable income year 2020 availability companys net operating loss carryforward subject limitation 50 positive change ownership company’s stock components net deferred tax asset summarized value 1000000 june 30 2011 june 30 2010 deferred tax asset 63 58 valuation allowance 63 58 following reconciliation provision income taxes us federal income tax rate income taxes reflected consolidated statements operations june 30 2011 june 30 2010 tax expense credit statutory ratefederal 34 state tax expense net federal tax 6 total note 21 contracts commitments agreement hawk associates inc august 11 2006 company entered investor relations consulting agreement hawk associates inc florida corporation effective september 1 2006 according agreement hawk associates provide investor relations consulting services company period six months agreement automatically renew monthly notice provided one parties company agrees pay hawk associates 4500 per month investor relations consulting services hawk associates issued warrants purchase 250000 common shares company based closing price 0015 per share september 1 2006 warrants valid august 30 2011 business cooperation agreement pho express september 19 2007 provimex inc subsidiary company entered business cooperation agreement owner pho express establish new vietnamese style noodle soup restaurant pho express international llc pho express agreed contribute assets liabilities exchange 40 equity ownership provimex agreed pay 165000 exchange 60 equity ownership pho express international llc june 30 2011 business cooperation agreement could closed company wrote 91600 previously deposited pho express business financial consulting agreement mast ventures llc effective april 1 2008 company entered business financial consulting agreement mast ventures llc raise capital wholly owned subsidiary philand corporation 5 years service includes assistance identifying potential investors developing approach seeking current financing investor relations company agreed pay 5 total funds raised consultant business financial consulting agreement linh thanh group effective april 26 2010 company signed agreement linh thanh group joint stock company vietnambased company take majorityowned subsidiary linh thanh group linh thanh quang binh exploiting processing high calcium carbonate powder joint stock company “ltqb” public us via reverse merge stock swap business combination us publicly traded company exchange services rendered company would receive compensation cash linh thanh group common stock combined company stock swap agreement ltqb us public company closed june 28 2010 however combined company reported updated financial information appropriate regulatory agencies date report company recognized 166667 revenues transaction june 30 2011 business financial consulting agreement thinh hung investment co effective may 21 2010 company signed agreement thinh hung investment co ltd vietnambased company assist thinh hung identifying locating possibly acquiring various business opportunities thinh co ltd subsidiary thinh hung including limited reverse merger stock swap business combination thinh publiclytraded company us exchange services rendered company would receive compensation cash thinh hung common stock combined company june 30 2011 company completed contemplated business combination thinh fiscal year end 2010 company recognized 26656 revenues transaction balance 293219 booked unearned income liability portion balance sheet office space lease company signed 5 year lease agreement corporate office effective may 1 2008 june 30 2011 monthly rental 7598 increased 35 per annum commencing thirteenth month initial lease term continuing annually thereafter leases offices vietnam 12 months starting january 2008 july 2008 respectively monthly rental approximately 450 per month 94368 97668 total minimum lease payment 192036 note 22 going concern uncertainty shown accompanying consolidated financial statements company accumulated deficit 28256269 negative cash flow operations amounting 441519 period ended june 30 2011 factors well uncertain conditions company faces daytoday operations respect cash flows create uncertainty companys ability continue going concern financial statements include adjustments might necessary company unable continue going concern company currently significant asset balance labeled construction progress real estate project called pointe 91 however balance represents cost incurred capitalized interest borrowed funds see note 8 balance also subject company’s commitment vietnamese governmental authorities carry development pointe 91 real estate project chu lai quang nam province vietnam management taken action strengthen companys working capital position generate sufficient cash meet operating needs june 30 2011 beyond next twelve months company continue focus following business activities 1 mergers acquisitions consulting services subsidiaries phi capital holdings inc phi vietnam holdings 2 mining majority owned subsidiary phi gold corporation minority interest tricon gold corporation 3 energy oil gas phi energy corporation phi oil gas ltd 4 real estate development philand ranch ltd philand corporation philand vietnam ltd 5 special situations may potential create substantial shareholder value company anticipates generating revenues proposed mergers acquisitions well business activities mentioned herein assurances made management successful achieving plan president chairman company committed funding companys operations next 12 months note 23 noncontrolling interests subsidiaries company noncontrolling interests number subsidiaries balance noncontrolling interest june 30 2011 2010 follows image omitted philand ranch limited years ended june 30 2011 2010 philand ranch limited net loss 313610 363849 b phi gold corp fka phi mining group years june 30 2011 2010 phi gold corp fka phi mining group net loss 29558 23430 respectively note 24 restatement subsequent fiscal year ended june 30 2010 company discovered errors calculation minority interest valuation investment account table reflects adjustments made company restated prior period financial statements adjustments carried forward financial statements contained filing restatements “unaudited” predecessor auditor reported financial statements restatement june 30 2010 june 30 2010 “unaudited” originally filed restated change deposit 20016 13161 6854 investment equity method 44846 total assets 1085351 1033650 51701 shares issued 63854 57000 6854 additional paidincapital 18409229 19827736 1418507 accumulated deficit 26963783 26999492 35709 noncontrolling interest 1242646 184999 1427645 total stockholders’equitydeficit 7056103 7107804 51701 total liabilities stockholders’ equitydeficit 1085351 1033650 51701 note 25 subsequent event august 4 2011 philand ranch granted land use rights also known land title first 2355 hectares pointe 91 project vietnamese government item 9 item 8 financial statements phi group inc independent auditor’s report board directors stockholders phi group inc formerly providential holdings inc independent auditors’ report audited accompanying consolidated balance sheets phi group inc nevada corporation subsidiary june 30 2012 2011 related consolidated statements operations stockholders’ equity cash flows year ended june 30 2012 2011 consolidated financial statements responsibility company’s management responsibility express opinion consolidated financial statements based audits management’s responsibility financial statements management responsible preparation fair presentation financial statements accordance accounting principles generally accepted united states america includes design implementation maintenance internal control relevant preparation fair presentation financial statements free material misstatement whether due fraud error auditor’s responsibility express opinion financial statements based audits conducted audits accordance auditing standards generally accepted united states america standards public company auditing oversight board standards require plan perform audit obtain reasonable assurance whether financial statements free material misstatement audit involves performing procedures obtain audit evidence amounts disclosures financial statements procedures selected depend auditor’s judgment including assessment risks material misstatement financial statements whether due fraud error making risk assessments auditor considers internal control relevant entity’s preparation fair presentation financial statements order design audit procedures appropriate circumstances purpose expressing opinion effectiveness entity’s internal control accordingly express opinion audit also includes evaluating appropriateness accounting policies used reasonableness significant accounting estimates made management well evaluating overall presentation financial statements believe audit evidence obtained sufficient appropriate provide basis audit opinion consolidated financial statements referred present fairly material respects consolidated financial position phi group inc subsidiary june 30 2012 2011 results consolidated operations cash flows year ended june 30 2012 2011 conformity accounting principles generally accepted united states america company’s financial statements prepared using generally accepted accounting principles applicable going concern contemplates realization assets liquidation liabilities normal course business company’s financial statements prepared using generally accepted accounting principles applicable going concern contemplates realization assets liquidation liabilities normal course business company accumulated deficit 35814955 negative cash flow operations amounting 1367705 year ended june 30 2012 factors discussed note 21 consolidated financial statements raise substantial doubt company’s ability continue going concern management’s plans regard matters also described note 21 consolidated financial statements include adjustments might result outcome uncertainties dave banerjee cpa accountancy corp woodland hills california may 15 2014 phi group inc subsidiaries consolidated balance sheets years ended june 30 2012 2011 audited accompanying notes form integral part unaudited consolidated financial statements phi group inc subsidiaries consolidated statement operation years ended june 30 2012 2011 audited accompanying notes form integral part unaudited consolidated financial statements phi group inc subsidiaries formerly providential holdings inc consolidated statements cash flows years ended june 30 2012 2011 audited accompanying notes form integral part unaudited consolidated financial statements phi group inc subsidiaries statement stockholders’ equity years ended june 30 2012 2011 audited accompanying notes form integral part consolidated financial statements phi group inc subsidiaries formerly providential holdings inc notes consolidated financial statements note 1 nature business established june 1982 phi group inc “company” “phi” nevada corporation primarily engaged energy natural resources company acquires consolidates energyrelated assets natural resources partners international companies develop independent power plant projects southeast asia collaborates certain us companies provide renewable energy solutions using wind solar power hydromagnetic gravitational systems company also provides corporate finance services including merger acquisition advisory consulting services arranges capital energyrelated natural resource infrastructure projects wholly owned subsidiary phi capital holdings inc addition company also participates international trade activity company originally incorporated laws state nevada june 1982 name jr consulting inc initially engaged mergers acquisitions operating subsidiary diva entertainment inc operated two modeling agencies one new york one california following business combination providential securities inc californiabased brokerage firm late 1999 company changed name providential securities inc nevada january 2000 company changed name providential holdings inc february 2000 october 2000 providential securities withdrew securities brokerage membership ceased financial services business subsequently april 2009 company changed name phi group inc october 2000 october 2011 company engaged mergers acquisitions advisory consulting services real estate hospitality development mining oil gas telecommunications technology healthcare private equity special situations since october 2011 company begun discontinue operations providential vietnam ltd philand ranch limited together subsidiaries philand corporation philand vietnam ltd phi gold corporation formerly phi mining corporation phi energy corporation mainly focused energy natural resources including investing andor developing coal assets international trade independent power plant projects renewable energy industrial minerals phi capital holdings inc company’s wholly owned subsidiary continues provide corporate project finance services including merger acquisition advisory consulting services companies variety industries arranging funding energyrelated natural resource infrastructure projects assurances made company successful achieving plan note 2 summary significant accounting policies principles consolidation consolidated financial statements include accounts phi group inc wholly owned subsidiary phi capital holdings inc discontinued operations providential securities inc phi energy corporation phi gold corp providential vietnam ltd philand ranch limited including 100 owned subsidiary philand corporation philand vietnam ltd collectively referred “company” significant intercompany transactions eliminated consolidation provimex inc touchlink communications inactive use estimates preparation consolidated financial statements conformity accounting principles generally accepted united states america requires management make estimates assumptions affect reported amounts assets liabilities disclosure contingent assets liabilities date financial statements reported amounts revenues expenses reporting period actual results could differ estimates cash equivalents company considers liquid investments maturity three months less date purchase readily convertible cash equivalents marketable securities company’s securities classified availableforsale carried fair value securities classified availableforsale may sold response changes interest rates liquidity needs purposes investment marketable securities represents less twenty percent 20 outstanding common stock equivalents investee security nationally quoted finra’s otc bulletin board “otcbb” otc markets investment accounted accordance provisions asc 320 previously sfas 115 unrealized holding gains losses availableforsale securities excluded earnings reported separate component stockholder’s equity realized gains losses securities classified availableforsale reported earnings based upon adjusted cost specific security sold june 30 2012 2011 marketable securities recorded 910791 174650 respectively based upon fair value marketable securities time accounts receivable management reviews composition accounts receivable analyzes historical bad debts june 30 2012 company balance 0 accounts receivable impairment longlived assets effective january 1 2002 company adopted asc 350 previously sfas 144 ”accounting impairment disposal longlived assets” addresses financial accounting reporting impairment disposal longlived assets supersedes sfas 121 “accounting impairment longlived assets longlived assets disposed of” accounting reporting provisions apb opinion 30 ”reporting results operations disposal segment business” company periodically evaluates carrying value longlived assets held used accordance asc 350 asc 350 requires impairment losses recorded longlived assets used operations indicators impairment present undiscounted cash flows estimated generated assets less assets’ carrying amounts event loss recognized based amount carrying amount exceeds fair market value longlived assets loss longlived assets disposed determined similar manner except fair market values reduced cost disposal property equipment property equipment stated cost maintenance repair costs charged expense incurred costs major additions betterments capitalized property equipment sold otherwise disposed cost related accumulated depreciation eliminated accounts resulting gain loss reflected income depreciation computed using straightline method estimated useful lives assets ranging three ten years depreciation amortization cost property equipment depreciated estimated useful lives related assets depreciation amortization fixed assets computed straightline basis net earnings per share company adopted provisions asc 260 previously sfas 128 asc 260 eliminates presentation primary fully diluted earnings per share “eps” requires presentation basic diluted eps basic eps computed dividing income loss available common stockholders weightedaverage number common shares outstanding period diluted eps based weightedaverage number shares common stock outstanding period common stock equivalents outstanding end period company following dilutive stock warrants june 30 2012 2011 net earnings per share computed follows stockbased compensation effective july 1 2006 company adopted asc 7181025 previously sfas 123r accordingly adopted modified prospective application method asc 7181025 applied new awards modified repurchased cancelled effective date additionally compensation cost portion awards outstanding date adoption requisite service rendered unvested options recognized period time remaining requisite services rendered fair value financial instruments effective july 1 2008 company adopted asc 820 previously sfas 157 fair value measurements adopted statement assets liabilities shown table asc 820 clarifies definition fair value prescribes methods measuring fair value establishes fair value hierarchy based inputs used measure fair value expands disclosures use fair value measurements adoption asc 820 material impact fair value measurements asc 820 permits company defer recognition measurement nonfinancial assets nonfinancial liabilities january 1 2010 june 30 2011 company nonfinancial assets nonfinancial liabilities recognized disclosed fair value asc 820 requires financial assets liabilities reported fair value categorized one following types investments based upon methodology determining fair value level 1 quoted prices active markets identical assets liabilities level 2 observable inputs level 1 prices quoted prices similar assets liabilities quoted prices markets active inputs observable corroborated observable market data substantially full term assets liabilities level 3 unobservable inputs supported little market activity significant fair value assets liabilities company utilizes various approaches measure fair value availableforsale securities assets measured fair value recurring basis summarized company financial liabilities measured fair value recurring basis availableforsale securities company uses various approaches measure fair value availableforsale securities applying threelevel valuation hierarchy disclosures specified asc 820 level 1 securities measured using quoted prices active markets identical assets liabilities company’s policy regarding transfers andor level 3 depends trading activity security volatility security observable units clearly represents fair value security level 3 security measured using fairly represented fair value transfer securities either level 1 level 2 depending type inputs revenue recognition company’s revenue recognition policies compliance asc 13 previously staff accounting bulletin sab 104 company recognizes consulting advisory fee revenues transaction completed service fees earned expenses recognized period corresponding liability incurred payments received relevant criteria revenue recognition recorded unearned revenue advertising company expenses advertising costs incurred advertising costs years ended june 30 2012 2011 1865 4346 respectively comprehensive income loss asc 2201045 previously sfas 130 reporting comprehensive income establishes standards reporting display comprehensive income components accumulated balances comprehensive income defined include changes equity except resulting investments owners distributions owners among disclosures sfas 130 requires items required recognized current accounting standards components comprehensive income reported financial statement displayed prominence financial statements june 30 2012 2011 respectively comprehensive income loss presented accompanying consolidated balance sheets income taxes company accounts income taxes accordance asc 740 previously sfas 109 “accounting income taxes” deferred taxes provided liability method whereby deferred tax assets recognized deductible temporary differences deferred tax liabilities recognized taxable temporary differences temporary differences reported amounts assets liabilities tax bases deferred tax assets reduced valuation allowance opinion management likely portion deferred tax assets realized deferred tax assets liabilities adjusted effects changes tax laws rates date enactment reporting segments asc 280 previously statement financial accounting standards 131 disclosures segments enterprise related information supersedes statement financial accounting standards 14 financial reporting segments business enterprise establishes standards way public enterprises report information operating segments annual financial statements requires reporting selected information operating segments interim financial statements regarding products services geographic areas major customers asc 280 defines operating segments components enterprise separate financial information available evaluated regularly chief operating decision maker deciding allocate resources assessing performance company operated one segment generated revenues years ended june 30 2012 2011 risks uncertainties normal course business company subject certain risks uncertainties company provides service receives marketable securities upon execution transactions consequently value securities received customers affected economic fluctuations customer’s business growth actual realized value securities could significantly different recorded value recent accounting pronouncements update 201111 balance sheet topic 210 disclosures offsetting assets liabilities effective annual reporting periods beginning january 1 2013 interim periods within annual periods entity provide disclosures required amendments retrospectively comparative periods presented update 201110property plant equipment topic 360 derecognition substance real estatea scope clarification consensus fasb emerging issues task force amendments update applied prospective basis deconsolidation events occurring effective date prior periods adjusted even reporting entity continuing involvement previously derecognized substance real estate entities public entities amendments update effective fiscal years interim periods within years beginning june 15 2012 nonpublic entities amendments effective fiscal years ending december 15 2013 interim annual periods thereafter early adoption permitted update 201106other expenses topic 720 fees paid federal government health insurers consensus fasb emerging issues task force effective calendar years beginning december 31 2013 fee initially becomes effective company either evaluated currently evaluating implications pronouncements possible impact may company’s financial statements cases management determined pronouncement either limited application company cases implementation would material impact financial statements taken whole note 3 loans receivable related parties loans receivable related parties consist following june 30 2012 2011 note 4 current assets comprise following june 30 2012 2011 note 5 marketable equity securities available sale company’s marketable securities classified availableforsale carried fair value securities comprised shares common stock investee securities classified availableforsale may sold response changes interest rates liquidity needs purposes investment marketable securities represents less twenty percent 20 outstanding common stock equivalents investee security nationally quoted national association securities dealers otc bulletin board “otcbb” pink sheets investment accounted accordance provisions sfas 115 marketable securities classified available sale consisted 1746500 shares vietnam mining corporation public company traded otc markets trading symbol vnmc earned consulting services rendered fair value shares received 174650 september 30 2011 september 30 2011 recorded 600000 4000000 shares common stock agent 155 media corp fully reporting company traded otcqb time symbol agmc consulting services rendered agent155 media corp phi group inc used closing price 015 per share september 30 2011 recording purpose december 31 2011 recorded 120000 4000000 shares common stock agent 155 media corp fully reporting company traded otcqb symbol agmc time consulting services rendered agent155 media corp phi group inc used closing price 003 per share december 31 2011 recording purpose realized gain loss transaction quarter ended march 31 2012 converted 4614125 promissory note exchange 3076073 shares common stock agent155 media corp fully reporting company traded otcqb time symbol agmc used closing price 0015 per share march 31 2012 quarter sold 2000000 shares common stock agent155 media corp third party purchased price 0001 per share recorded loss 28000 note 6 property equipment property equipment june 30 2012 2011 consists following depreciation expenses 1256 2745 fiscal years ended june 30 2012 2011 respectively note 7 assets fiscal year ended june 30 2011 philand vietnam ltd wholly owned subsidiary philand ranch ltd made security deposit amount 172203 chu lai open economic zone authority quang nam province vietnam guarantee pointe91 development project bien rang chu lai nui thanh district quang nam province vietnam amount later transferred ky ha chu lai investment development llc “khclidc” deposit clearing land resettlement residents pointe91 project area result discontinuance pointe91 development project company expects receive refund deposit amount less expenses incurred connection land clearing resettlement activity philand vietnam ltd received vnd 15 billion back khclidc january 21 2014 50000 transferred phi group inc january 23 2014 year ended june 30 2011 company signed consulting agreement assist agent155 media corp delaware corporation respect corporate restructuring business combination freshwater technologies inc nevada corporation part restructuring requirements company made payment manning elliot llp amount 24476 behalf freshwater technologies inc loan amounts agent155 media corp june 30 2012 agent155 media corp still owed company 66955 note 8 discontinued operations company decided recognize businesses phi gold corp formerly phi mining corporation providential vietnam ltd phi energy corp philand ranch ltd united kingdom corporation together whollyowned subsidiaries philand corporation usa philand ranch ltd singapore philand vietnam ltd discontinued operations june 30 2012 practical business accounting purposes company recorded total 2234327 liabilities potential liability contingencies written nonperforming assets associated discontinued operations accompanying consolidated financial statements june 30 2012 note 9 accounts payable accrued expenses accounts payable accrued expenses june 30 2012 2011 consist following note 10 due officer due officer represents advances made officers company subsidiaries noninterest bearing except 100000 described unsecured due demand june 30 2012 2011 balances 1489072 1317949 respectively june 30 2012 company short term note payable amounting 100000 interest bearing 3000 per month payable member board directors note 11 loans promissory notes short term notes payable june 30 2012 june 30 2011 company short term notes payable amounting 2125456 2432456 accrued interest 2509944 1872479 respectively notes bear interest rates ranging 6 36 per annum 1744982 short term notes past due 258976 due demand notes payable secured assets company summarized convertible promissory note last convertible promissory note issued asher enterprises inc “asher” june 17 2011 42500 interest 8 per annum due payable march 21 2012 note convertible election asher time issuance date 39 discount average lowest closing bid prices company’s common stock ten trading day period ending latest complete trading prior conversion date event default amount principal interest paid due bear interest rate 22 per annum note becomes immediately due payable occur company liable pay asher 150 outstanding principal interest note agreements contain covenants requiring asher’s written consent certain activities existence committed company issue date note outstanding note principal interest amounts accrued thereon converted whole part time asher issuance date equivalent company’s common stock determined discount rate mentioned note additionally note contains reset provision exercise price conversion price company issues equity derivatives price less exercise price set forth warrants note ratchet provision results derivative liability financial statements july 25 2011 10000 principal convertible note issued january 11 2011 converted equivalent 1550 shares postsplit common stock company 2325581 presplit shares august 8 2011 12000 principal convertible note issued january 11 2011 converted equivalent 1633 shares postsplit common stock company 2448980 presplit shares august 30 2011 15000 principal convertible note issued january 11 2011 converted equivalent 2941 shares postsplit common stock company 4411765 presplit shares october 21 2011 8000 principal convertible note issued january 11 2011 converted equivalent 2667 shares postsplit common stock company 4000000 presplit shares november 22 2011 10000 principal convertible note issued january 11 2011 converted equivalent 5083 shares postsplit common stock company 7625000 presplit shares january 03 2012 10000 principal convertible note issued june 17 2011 converted equivalent 4444 shares postsplit common stock company 6666667 presplit shares january 11 2012 11000 principal convertible note issued june 17 2011 converted equivalent 5641 shares postsplit common stock company 8461538 presplit shares march 1 2012 12000 principal convertible note issued june 17 2011 converted equivalent 5741 shares postsplit common stock company 8571429 presplit shares april 23 2012 asher enterprises inc converted 7000 principal amount convertible note dated june 17 2011 8197 shares postsplit common stock company price 0854 per share june 30 2012 total outstanding balance amount due asher enterprises inc 3750 due preferred stockholders company classified 215000 preferred stock subscribed current liability payable holders preferred stock previously discontinued subsidiary company due non compliance preferred shares subscription agreement year 2000 company made offer preferred stock holders receive shares common stock company exchange preferred shares far preferred shareholders accepted offer interest expenses payable holders preferred stock 310055 284255 included accrued interest included account payable accrued expenses balance sheets june 30 2012 june 30 2011 respectively unearned revenue unearned revenue 563219 consulting fee service performed company completed june 30 2012 note 12 litigation legal proceeding settled unpaid june 30 2012 quang van cao nhan thi nguyen cao vs providential securities inc et al case originally submitted orange county superior court ca june 25 1997 case 781121 subsequently moved nasd dispute resolution arbitration august 24 2000 company’s legal counsel negotiated claimant’s counsel unilaterally reached settlement approved company process renegotiating terms said settlement claimants filed request arbitration hearing national association securities dealers october 4 2000 case 9903160 thereafter claimants filed complaint orange county superior court ca october 31 2000 case 00cc13067 alleged breach contract damages sum 75000 plus prejudgment interest costs incurred connection complaint relief without admitting denying allegations company reached settlement agreement claimants whereby company would pay claimants total 62500 plus 4500 administrative costs date report company paid 2500 subject entry judgment 79000 may 2011 claimants filed application renewal judgment total 14049078 amount accrued accompanying consolidated financial statements legal proceeding pending june 30 2012 february 01 2010 company notified suit filed superior court state california county los angeles november 24 2009 william davidson individual martin doan henry fahman benjamin tran hrciti corporation providential capital inc collectively referred “defendants” case bc 426831 plaintiff demanded amount less 14000000 defendants promissory notes outstanding plaintiff company july 09 2012 william davidson phi capital holdings inc formerly providential capital inc subsidiary company reached settlement agreement respect whereby phi capital agreed pay william davidson total 200000 period nineteen months beginning september 1 2012 june 30 2013 william davidson elected convert portion total amount common stock phi group inc lieu cash payment company accrued potential liabilities associated promissory notes accompanying consolidated financial statements june 30 2012 note 23 subsequent event note 13 payroll liabilities payroll liabilities accrued recorded accrued expenses consolidated balance sheet june 30 2012 company owed internal revenue service state california employment development department payroll tax penalties interest amounting 115886 note 14 basic diluted net loss per share net loss per share calculated accordance sfas 128 “earnings per share” provision sfas 128 basic net loss per share computed dividing net loss period weightedaverage number common shares outstanding period diluted eps based weightedaverage number shares common stock outstanding period common stock equivalents outstanding end period basic diluted weighted average numbers shares year ended june 30 2011 since inclusion common stock equivalents antidilutive note 15 stockholder’s equity effective april 13 2009 company amended articles incorporation change par values preferred common stock 0001 company 400000000 authorized capital stock consisting 300000000 shares common stock par value 0001 per share 100000000 shares preferred stock par value 0001 rights terms associated preferred stock determined board directors company march 15 2012 company effectuated 1 1500 reverse split company’s common stock treasury stock balance treasury stock june 30 2012 887 postsplit shares 1330440 presplit shares valued par 100 common stock year ended june 30 2012 company issued 37897 shares postsplit common stock asher enterprises inc conversions total 95000 convertible notes april 24 2012 company issued 849 shares postsplit common stock cede co company’s beneficial holders fractional shares following reverse split june 30 2012 180689 postsplit shares common stock company issued outstanding preferred stock preferred stock issued outstanding shares issued 06092006 luberski inc transferred subsequently sold 1000000 presplit shares common stock phi group inc belonging officer company given luberski inc collateral loan company june 30 2007 company agreed pay back 1000000 presplit shares valued 57000 officer recorded transaction shares issued prepaid consulting year ended june 30 2010 company signed consulting agreement consulting service one year company issued 200000 shares common stock consultant valued 10000 based upon market value stock date stock issuance company amortized 5000 year ended june 30 2011 note 16 stock based compensation plan stockbased compensation february 7 2005 company adopted stockbased compensation plan set aside 14000000 shares common stock selected eligible participants company subsidiaries certain independent contractors providing certain services company prior july 1 2006 company measured stock compensation expense using intrinsic value method accounting accordance accounting principles board apb opinion 25 “accounting stock issued employees” related interpretations apb 25 company adopted sfas 123r effective july 1 2006 using modified prospective method warrants quarter ended september 30 2006 company issued 250000 stock warrants term 5 years three year vesting period following assumptions used blackscholes pricing model following summary warrant activity years ended june 30 2011 june 30 2012 respectively note 17 loss settlement debts year ended june 30 2011 company settled notes payable principal related accrued interest asher enterprises inc nonaffiliate creditor totaling 99574 issuance 14600295 shares common stock fair value 529206 50960 shares subsidiary fair value 15768 result company recorded loss 402107 settlement debts june 30 2011 year ended june 30 2012 company recorded loss 32808 settlement debts result issuance shares common stock asher enterprises note 18 related party transactions company accrued 210000 salaries henry fahman president company tina phan secretary company years ended june 30 2012 june 30 2011 revenues company generated phi group parent company provides consulting services clients revenues considered earned services deemed complete company receives consideration consulting services provided either cash andor common stock client company revenues earned company’s subsidiaries periods income statements presented fiscal year ended june 30 2012 company earned following revenues note 19 income taxes provision made income tax since company significant net operating loss carry forward june 30 2012 company incurred net operating losses tax purposes approximately 290 million net operating loss carry forward may used reduce taxable income year 2030 net operating loss carry forwards state california generally available reduce taxable income year 2020 availability company’s net operating loss carryforward subject limitation 50 positive change ownership company’s stock see note 2 note 20 contracts commitments agreement hawk associates inc august 11 2006 company entered investor relations consulting agreement hawk associates inc florida corporation effective september 1 2006 according agreement hawk associates would provide investor relations consulting services company period six months agreement would automatically renew monthly notice provided one parties company agreed pay hawk associates 4500 per month investor relations consulting services hawk associates would issued warrants purchase 250000 common shares company based closing price 0015 per share september 1 2006 warrants valid august 30 2011 business financial consulting agreement mast ventures llc effective april 1 2008 company entered business financial consulting agreement mast ventures llc raise capital wholly owned subsidiary philand corporation 5 years service includes assistance identifying potential investors developing approach seeking current financing investor relations company agreed pay 5 total funds raised consultant business financial consulting agreement thinh hung investment co effective may 21 2010 company signed agreement thinh hung investment co ltd vietnambased company assist thinh hung identifying locating possibly acquiring various business opportunities thinh co ltd subsidiary thinh hung including limited reverse merger stock swap business combination thinh publiclytraded company us exchange services rendered company would receive compensation cash thinh hung common stock combined company september 30 2011 company completed stock purchase investment agreement thinh anh co ltd vietnam foods corporation nevada corporation however combined company filed registration statement securities exchange commission become reporting company fiscal year end 2010 company recognized 26656 revenues transaction balance 293219 booked unearned income liability portion balance sheet agreement purchase sale pt bindakar december 17 2011 company signed agreement purchase sale pt bindakar indonesia corporation acquire approximately 2670 hectares coal concession marga mulya kecamatan rambah samo kabupaten rokan hulu propinsi riau indonesia pt bindakar total purchase price twenty five billion indonesian rupiahs according agreement pt bindakar pay liabilities related acquired assets obtain valid iup production license coal concession prior intended closing date march 31 2012 agreement may terminated time prior closing date mutual agreement pt bindakar company b another buyer acquired assets close transaction sooner company c pt bindakar unable obtain iup production license march 30 2012 unless parties agree extend date writing material breach either party material representation warranty covenant agreement set forth agreement cured reasonable satisfaction party within ten business days notice breach given informing party e transaction contemplated agreement purchase sale consummated march 31 2012 unless parties agree extend closing date writing f injunction order governmental entity competent authority prevents consummation transaction contemplated agreement march 31 2012 agreement purchase sale became null void due fact pt bindakar unable obtain iup production license date mentioned agreement powerdyne industries llc december 5 2011 company signed business cooperation agreement powerdyne industries llc california limited liability company stn group llc california limited liability company introduce powerdyne’s clean coal combustion technologies potential power plant owners operators various geographical areas limited powerdyne’s worldwide rights agreement expired one year signing date agreement sao nam group december 22 2011 company signed memorandum understanding investment quang tri power plant project central vietnam sao nam group vietnamese company introduce provide necessary financial technical services well longterm coal supply project indonesia june 30 2012 company pursued project mainly due sao nam group’s prioritized focus shipping port services agreements hoang ngoc joint stock company december 23 2011 company signed business cooperation agreement hoang ngoc joint stock company vietnamese corporation cooperate hoang ngoc co order obtain investment license provide required technologies arrange investment capital purpose establishing operating one coalfire power plants giang province vietnam specifically phi shall invest cause invested required capital conjunction andor via qualified affiliates partners hereinafter referred “principal investors” longstanding operational history area thermal power provide cause provided required technical expertise conjunction andor via qualified affiliates partners establish operate maintain power plants grant power plants first right refusal certain coal supplies owned controlled phi lifetime power plants subject terms conditions detailed subsequent agreements march 18 2012 indochina energy ltd newformed subsidiary company signed investment agreement hoang ngoc joint stock company jointly cooperate hoang ngoc co order obtain investment license provide required technologies arrange investment capital purpose establishing operating one coalfire power plants giang province vietnam accordance business cooperation agreement dated december 23 2011 company hoang ngoc co investment agreement subsequently superseded replaced investment agreement dated april 5 2012 whereby phi group inc covenants continue provide clean coal technology longterm coal supply power plants pursuant aforementioned business cooperation agreement dated december 23 2011 following demise hoang ngoc’s founder chairman company decided discontinue project agreement global sun wind power corp april 27 2012 company signed business cooperation agreement global sun wind power corp nevada corporation cooperate gswp introduce gswp technologies countries southeast asia viz brunei burma east timor cambodia laos malaysia philippines singapore thailand vietnam india new papua guinea australia develop finance implement business plans using gswp technologies electricity generation geographical areas restricted agreements contracts either gswp company party global sun wind power manufactures one innovative wind turbines world market today also offers complete hybrid power systems incorporating wind solar minihydro diesel backup systems stateofthe art battery storage technologies gswp’s systems highly efficient gridconnected offgrid applications business cooperation agreement expired one year signing date corporate combination agreement provimex inc hpita jsc june 19 2012 provimex inc changed name hpita corporation july 20 2012 hpita corporation “hpus” signed corporate combination agreement acquire issued outstanding stock hpita joint stock company organized existing laws vietnam exchange solely amount authorized unissued common stock hpus equal 95 issued outstanding shares hpus’s common stock immediately following issuance shares hpus intends complete required financial audits file form 10 registration statement securities exchange commission become separate fully reporting publicly traded company us date report hpus filed registration statement securities exchange commission note 21 going concern uncertainty shown accompanying consolidated financial statements company accumulated deficit 35814955 negative cash flow operations amounting 1367705 period ended june 30 2012 factors well uncertain conditions company faces daytoday operations respect cash flows create uncertainty company’s ability continue going concern financial statements include adjustments might necessary company unable continue going concern management taken action strengthen company’s working capital position generate sufficient cash meet operating needs june 30 2012 beyond next twelve months company would focus energy natural resources including investing developing coal assets independent power plant projects renewable energy industrial minerals well engaging international trade phi capital holdings inc company’s wholly owned subsidiary would also continue provide corporate project finance services including merger acquisition advisory consulting services companies variety industries arranging funding energyrelated natural resource infrastructure projects company anticipated generating revenues proposed mergers acquisitions well business activities mentioned herein assurances could made management would successful achieving plan president chairman company committed funding company’s operations next 12 months note 22 noncontrolling interests subsidiaries year ended june 30 2011 company noncontrolling interests number subsidiaries balance noncontrolling interest june 30 2012 2011 follows year ended june 30 2011 philand ranch ltd net loss 313610 year ended june 30 2011 phi gold corp fka phi mining group net loss 29558 june 30 2012 subsidiaries classified discontinued operations note 23 subsequent event settlement litigation july 09 2012 william davidson phi capital holdings inc formerly providential capital inc subsidiary company reached settlement agreement respect case bc 426831 davidson vs doan et al whereby phi capital agreed pay william davidson total 200000 period nineteen months beginning september 1 2012 june 30 2013 william davidson elected convert portion total amount common stock phi group inc lieu cash payment agreement global development systems inc august 11 2012 company signed business cooperation agreement global development systems inc texas corporation market renewable energy electricity generation using global development systems inc’s proprietary hydromagnetic gravitational renewable energy technologies term agreement two years office rental agreements august 11 2012 company signed agreement rent business center office las vegas nevada approximately 100 per month plus administrative expenses oneyear term rental agreement expired august 31 2013 renewed another twelvemonth term expire august 31 2014 agreement makani power inc august 16 2012 company signed business cooperation agreement makani power inc delaware corporation market renewable energy electricity generation system using makani power’s proprietary airborne wind turbine technology term agreement two years resignation board member november 27 2012 paul nguyen submitted letter resignation resign company’s board director disagreement mr nguyen company regarding company’s policies andor practices termination business cooperation agreement powerdyne industries llc business cooperation agreement powerdyne industries llc expired one year december 4 2012 parties chose renew agreement happenex holding bv december 22 2012 company signed business cooperation agreement happenex holding bv dutch corporation cooperate international trade coal natural resource commodities term agreement two years agreement purchase sale pt tambang sekarsa adadaya december 24 2012 company signed agreement purchase sale pt tambang sekarsa adadaya “tsa” indonesian limited liability company holders minimum seventy percent 70 equity ownership tsa acquire seventy percent 70 equity interest tsa exchange total purchase price ten million five hundred thousand us dollars us 10500000 cash stock company tsa currently owns two coal concessions together operation production licenses izin usaha pertambangan operasi produksi pertinent licenses permits covering total area 9690 hectares purportedly containing approximately 205 million metric tonnes indicative coal resources kecamatan baras sarudu kabupaten mamuju utara propinsi sulawesi barat indonesia january 10 2013 company issued 3288443 shares common stock phi group inc deposit towards total purchase price march 16 2013 company signed amendment tsa majority shareholder tsa extend closing date transaction june 30 2013 company engaged pt runge indonesia subsidiary rungepincockminarco australian company conduct independent technical due diligence tsa coal concessions esp law firm indonesia legal firm conduct legal due diligence tsa since technical legal financial due diligence results incomplete extension date transaction terminated june 30 2013 however company tsa recently continued renegotiate terms conditions revised transaction agreement hpita jsc january 11 2013 company signed business cooperation agreement hpita joint stock company organized existing laws vietnam participate international trade base precious metals crossborder financial intermediation term agreement two years business financial consulting agreement january 16 2013 phi capital holdings inc subsidiary company signed agreement hpi company organized existing laws vietnam provide business consulting services hpi term agreement six months fee compensation one hundred thousand us dollars date report phi capital holdings received payment agreement esp law firm january 25 2013 company signed agreement retain esp law firm indonesian advocate legal consultant firm conduct legal due diligence behalf company connection pt tambang sekarsa adadaya acquisition company agreed pay esp law firm 10000 cash 50000 restricted common stock phi group inc’s legal services related contemplated acquisition agreement colebrand international ltd january 28 2013 company signed business cooperation agreement colebrand international ltd company organized existing laws united kingdom cooperate international trade financial intermediation term agreement two years agreement pt runge indonesia february 6 2013 company signed agreement retain pt runge indonesia subsidiary rungepincockminarco australian company provide technical assistance company developing potential jorc resources reserves statement open cut coal deposit pt tambang sekarsa adadaya’s concessions located sulawesi barat indonesia according agreement pt runge indonesia conduct technical due diligence several stages order provide estimate resources reserves compliant jorc code company invoiced work progresses agreement paca february 25 2013 phi capital holdings inc subsidiary company signed consultingengagement agreement paca new york corporation contemplate raising capital purpose financing phi group inc’s business plan including acquisition various energy properties general working capital term engagement two years paca entitled cash success fee equity success fee successful financing transaction agreement purchase sale pt harjo mas makmur march 16 2013 company signed agreement purchase sale pt harjo mas makmur “hmm” indonesian limited liability company holders minimum ninetyfive percent 95 equity ownership hmm acquire ninetyfive percent 95 equity interest hmm exchange total purchase price eight million five hundred fifty thousand us dollars us 8550000 cash stock company hmm currently owns producing coal concession operation production licenses izin usaha pertambangan operasi produksi pertinent licenses permits covering total area 745 hectares kelurahan mentawir kecamatan sepaku kabupaten penajam paser utara propinsi kalimantan timur indonesia together production support transportation facilities june 16 2013 company decided pursue transaction due unsatisfactory due diligence results termination business cooperation agreement global sun wind power corp business cooperation agreement global sun wind power corp expired one year april 26 2013 parties chose renew agreement indonesian office rental agreement may 7 2013 company signed agreement pt karya central bisnis indonesian company rent business center office pondok indah south jakarta indonesia term agreement one year expire may 2014 unless renewed agreement pt raksasa metal agung june 29 2013 company signed business cooperation agreement pt raksasa metal agung “agung” indonesian company codevelop gold mining projects central java indonesia subsequently agung company signed two addenda business cooperation agreement dated october 7 2013 january 29 2014 respectively set forth capital requirements gold mining projects profit sharing agreement according addenda company entitled 60 agung 40 net profits derived operations second addendum also allows company right assign responsibilities benefits connection business cooperation agreement vietnam mining corporation nevada corporation another entity agreement pacific energy network august 16 2013 company signed business cooperation agreement pacific energy network inc washington corporation cooperate develop implement conventional renewable energy business projects geographical areas terms conditions mutually acceptable parties term agreement two years withdrawal pointe91 hospitality development project philand ranch ltd september 20 2013 philand vietnam limited whollyowned subsidiary philand corporation submitted request chu lai open economic zone authority “cloeza” quang nam province voluntarily withdraw pointe91 hospitality development project tam quang village nui thanh district quang nam province surrender investment license due changed market conditions meeting held october 28 2013 among cloeza ky ha chu lai investment development company “khclidc” philand vietnam ltd cloeza agreed philand vietnam ltd’s request termination pointe91 development project instructed appropriate cloeza departments khclidc return unspent deposits philand vietnam ltd assist termination process november 2013 khclidc philand vietnam ltd signed settlement agreement terminate previously executed land clearance compensation agreement two companies agreed khclidc would return vnd 2705349242 deposit amount philand vietnam ltd agreement vinabenny energy joint stock company november 12 2013 company signed business cooperation investment agreement vinabenny joint stock company vietnamese company cooperate codevelop invest cause invested implement operate 84000 mt lpg terminal project giuoc district long province vietnam parties agree roles responsibilities benefits party connection terminal project separate subsequent agreement term agreement one year agreement ne nord energy joint stock company november 14 2013 company signed business cooperation investment agreement ne nord energy joint stock company vietnamese company cooperate codevelop invest cause invested produce market sell led lighting solar energy kinetic power supply system renewable energy energyrelated products services geographical areas markets deem economically beneficial parties term agreement two years business financial consulting agreement asia green corp january 17 2014 phi capital holdings inc whollyowned subsidiary company signed business financial consulting agreement asia green llc “asia green vn” vietnamese company engaged afforestation reforestation projects vietnam assist asia green becoming fully reporting publicly traded company united states arranging capital asia green execute business plan phi capital holdings entitled receive six hundred twenty thousand us dollars compensation services rendered term agreement one year asia green become fully reporting public company april 11 2014 touchlink communications inc nevada corporation majorityowned subsidiary company changed name asia green corporation entered corporate combination agreement asia green vn become holding company asia green vn’s agroforestry afforestation business stock purchase agreements common stock vietnam mining corporation january 24 2014 company signed stock purchase agreements acquire total fourteen million shares common stock vietnam mining corporation “vnmc” nevada corporation two individuals total purchase price 14117500 closing transactions scheduled occur twentieth business day following vnmc’s regaining current good standing status state nevada otc markets transfer agents depository trust corporation pertinent entities consulting engagement agreement vietnam mining corporation january 24 2014 phi capital holdings inc whollyowned subsidiary company signed consulting engagement agreement vietnam mining corporation “vnmc” nevada corporation assist vnmc regain current good standing status pertinent regulatory agencies united states certain private service providers seek new business opportunities vnmc phi capital holdings entitled receive four million shares restricted common stock vnmc pursuant provisions rule 144 compensation services rendered term agreement six months memorandum understanding pt bumi permata indonesia january 29 2014 company signed memorandum understanding “mou” pt bumi permata indonesia indonesian company codevelop 199hectare coal concession kecamatan rantau pandan kabupaten bungo provinsi jambi indonesia parties agree sign definitive agreement containing representations warranties covenants indemnities customary transaction time within 30 days following date mou memorandum understanding pt cendrawasih international january 29 2014 company signed memorandum understanding “mou” pt cendrawasih international indonesian company codevelop 8100hectare gold concession kecamatan kotannopan tambangan kabupaten mandailing natal sumatra utara indonesia parties agree sign definitive agreement containing representations warranties covenants indemnities customary transaction time within 30 days following date mou also allows company right assign responsibilities benefits connection project vietnam mining corporation nevada corporation another entity memorandum understanding cv sindo makmur coal mining january 31 2014 company signed memorandum understanding “mou” cv sindo makmur coal mining indonesian company codevelop operate various coal metal concessions indonesia particularly 100hectare coal concession dondang kecamatan muara jawa kabupaten kutai kartanegara east kalimantan 11960hectare coal concession bukit pinang kecamatan samarinda ulu kota samarinda east kalimantan indonesia parties agree sign definitive agreement containing representations warranties covenants indemnities customary transaction time within 30 days following date mou funding agreement regarding petrobras bonds february 4 2014 company signed funding agreement dieterich group robert terry provide 300000 likely increasing 400000 funding best efforts nonexclusive basis underwrite collection efforts undertaken series 500 bonds originally issued petrobras brazilian corporation focused oil gas exploration development bonds currently owned controlled starboard financial nevada llc recent valuation report bonds published discounted value 750000 including 7 interest february 2008 possible published redemption face value 2300000 according funding agreement company receive total recovery 10 times investment funding 125 net proceeds assuming entire funding provided company andor investors bond collections deduction trading selling expenses brazilian agents starboard financial brazilian parties received first 20000000 recovered issuances company’s common stock july 19 2012 officer company converted total 307000 debts owed company 1196424 shares phi group inc’s restricted common stock july 31 2012 seven creditors company converted total 17733333 debts owed company 504865 shares phi group inc’s common stock november 19 2012 company reserved 5673327 shares common stock special dividend distribution november 30 2012 four creditors company converted total 22007906 debts owed company 81737 shares phi group inc’s common stock january 10 2013 company issued 3288443 shares phi group inc’s common stock valued 5250000 majority shareholder pt tambang sekarsa adadaya deposit towards total purchase price 70 equity interest pt tambang sekarsa adadaya february 14 2013 creditor company converted total 100000 debts owed company 103923 shares phi group inc’s common stock february 22 2013 company issued 44763 shares phi group inc’s common stock valued 50000 indonesian attorney payment legal services connection purchase pt tambang sekarsa adadaya february 22 2013 creditor company converted total 33633 debts owed company 44844 shares phi group inc’s common stock april 11 2013 creditor company converted 50000 owed company 76540 shares phi group inc’s common stock april 26 2013 three creditors company converted total 180000 debts owed company 304913 shares phi group inc’s common stock may 10 2013 company issued 25510 shares restricted common stock 10000 cash rule 144 working capital may 10 2013 company issued 75377 shares restricted common stock 30000 cash rule 144 working capital july 1 2013 three creditors company converted total 117940 debts owed company 412569 shares phi group incs common stock 2142014 creditor company converted total 156750 debts owed company 337097 shares phi group inc’s common stock item 9 item 8 financial statements phi group inc independent auditor’s report board directors stockholders phi group inc formerly providential holdings inc independent auditors’ report audited accompanying consolidated balance sheets phi group inc nevada corporation subsidiary june 30 2013 2012 related consolidated statements operations stockholders’ equity cash flows year ended june 30 2013 2012 consolidated financial statements responsibility company’s management responsibility express opinion consolidated financial statements based audits management’s responsibility financial statements management responsible preparation fair presentation financial statements accordance accounting principles generally accepted united states america includes design implementation maintenance internal control relevant preparation fair presentation financial statements free material misstatement whether due fraud error auditor’s responsibility express opinion financial statements based audits conducted audits accordance standards public company auditing oversight board standards require plan perform audit obtain reasonable assurance whether financial statements free material misstatement audit involves performing procedures obtain audit evidence amounts disclosures financial statements procedures selected depend auditor’s judgment including assessment risks material misstatement financial statements whether due fraud error making risk assessments auditor considers internal control relevant entity’s preparation fair presentation financial statements order design audit procedures appropriate circumstances purpose expressing opinion effectiveness entity’s internal control accordingly express opinion audit also includes evaluating appropriateness accounting policies used reasonableness significant accounting estimates made management well evaluating overall presentation financial statements believe audit evidence obtained sufficient appropriate provide basis audit opinion consolidated financial statements referred present fairly material respects consolidated financial position phi group inc subsidiary june 30 2013 2012 results consolidated operations cash flows year ended june 30 2013 2012 conformity accounting principles generally accepted united states america company’s financial statements prepared using generally accepted accounting principles applicable going concern contemplates realization assets liquidation liabilities normal course business company accumulated deficit 36699002 negative cash flow operations amounting 884047 year ended june 30 2013 factors discussed note 21 consolidated financial statements raise substantial doubt company’s ability continue going concern management’s plans regard matters also described note 21 consolidated financial statements include adjustments might result outcome uncertainties dave banerjee cpa accountancy corp woodland hills california september 19 2014 phi group inc subsidiaries consolidated balance sheets audited accompanying notes form integral part unaudited consolidated financial statements phi group inc subsidiaries consolidated statements operations years ended june 30 2013 2012 audited accompanying notes form integral part unaudited consolidated financial statements phi group inc subsidiaries statements stockholders’ equity periods ended june 30 2013 2012 auditted accompanying notes form integral part consolidated financial statements phi group inc subsidiaries consolidated statements cash flows year ended june 30 2013 2012 audited accompanying notes form integral part unaudited consolidated financial statements phi group inc subsidiaries formerly providential holdings inc notes consolidated financial statements note 1 nature business established june 1982 phi group inc “company” “phi” nevada corporation primarily engaged energy natural resources company acquires consolidates energyrelated assets natural resources partners international companies develop independent power plant projects southeast asia collaborates certain us companies provide renewable energy solutions using wind solar power hydromagnetic gravitational systems company also provides corporate finance services including merger acquisition advisory consulting services arranges capital energyrelated natural resource infrastructure projects wholly owned subsidiary phi capital holdings inc addition company also participates international trade activity company originally incorporated laws state nevada june 1982 name jr consulting inc initially engaged mergers acquisitions operating subsidiary diva entertainment inc operated two modeling agencies one new york one california following business combination providential securities inc californiabased brokerage firm late 1999 company changed name providential securities inc nevada january 2000 company changed name providential holdings inc february 2000 october 2000 providential securities withdrew securities brokerage membership ceased financial services business subsequently april 2009 company changed name phi group inc october 2000 october 2011 company engaged mergers acquisitions advisory consulting services real estate hospitality development mining oil gas telecommunications technology healthcare private equity special situations since october 2011 company begun discontinue operations providential vietnam ltd philand ranch limited together subsidiaries philand corporation philand vietnam ltd phi gold corporation formerly phi mining corporation phi energy corporation mainly focused energy natural resources including investing andor developing coal assets international trade independent power plant projects renewable energy industrial minerals phi capital holdings inc company’s wholly owned subsidiary continues provide corporate project finance services including merger acquisition advisory consulting services companies variety industries arranging capital energyrelated natural resource infrastructure projects assurances made company successful achieving plan note 2 summary significant accounting policies principles consolidation consolidated financial statements include accounts phi group inc wholly owned subsidiary phi capital holdings inc discontinued operations providential securities inc phi energy corporation phi gold corp providential vietnam ltd philand ranch limited including 100 owned subsidiary philand corporation philand vietnam ltd collectively referred “company” significant intercompany transactions eliminated consolidation provimex inc touchlink communications inactive use estimates preparation consolidated financial statements conformity accounting principles generally accepted united states america requires management make estimates assumptions affect reported amounts assets liabilities disclosure contingent assets liabilities date financial statements reported amounts revenues expenses reporting period actual results could differ estimates cash equivalents company considers liquid investments maturity three months less date purchase readily convertible cash equivalents marketable securities company’s securities classified availableforsale carried fair value securities classified availableforsale may sold response changes interest rates liquidity needs purposes investment marketable securities represents less twenty percent 20 outstanding common stock equivalents investee security nationally quoted finra’s otc bulletin board “otcbb” otc markets investment accounted accordance provisions asc 320 previously sfas 115 unrealized holding gains losses availableforsale securities excluded earnings reported separate component stockholder’s equity realized gains losses securities classified availableforsale reported earnings based upon adjusted cost specific security sold june 30 2013 2012 marketable securities recorded 207703 356172 respectively based upon fair value marketable securities time accounts receivable management reviews composition accounts receivable analyzes historical bad debts june 30 2013 company accounts receivable impairment longlived assets effective january 1 2002 company adopted asc 350 previously sfas 144 “accounting impairment disposal longlived assets” addresses financial accounting reporting impairment disposal longlived assets supersedes sfas 121 “accounting impairment longlived assets longlived assets disposed of” accounting reporting provisions apb opinion 30 “reporting results operations disposal segment business” company periodically evaluates carrying value longlived assets held used accordance asc 350 asc 350 requires impairment losses recorded longlived assets used operations indicators impairment present undiscounted cash flows estimated generated assets less assets’ carrying amounts event loss recognized based amount carrying amount exceeds fair market value longlived assets loss longlived assets disposed determined similar manner except fair market values reduced cost disposal property equipment property equipment stated cost maintenance repair costs charged expense incurred costs major additions betterments capitalized property equipment sold otherwise disposed cost related accumulated depreciation eliminated accounts resulting gain loss reflected income depreciation computed using straightline method estimated useful lives assets ranging three ten years depreciation amortization cost property equipment depreciated estimated useful lives related assets depreciation amortization fixed assets computed straightline basis net earnings loss per share company adopted provisions asc 260 previously sfas 128 asc 260 eliminates presentation primary fully diluted earnings per share “eps” requires presentation basic diluted eps basic eps computed dividing income loss available common stockholders weightedaverage number common shares outstanding period diluted eps based weightedaverage number shares common stock outstanding period common stock equivalents outstanding end period net earnings loss per share computed follows stockbased compensation effective july 1 2006 company adopted asc 7181025 previously sfas 123r accordingly adopted modified prospective application method asc 7181025 applied new awards modified repurchased cancelled effective date additionally compensation cost portion awards outstanding date adoption requisite service rendered unvested options recognized period time remaining requisite services rendered fair value financial instruments effective july 1 2008 company adopted asc 820 previously sfas 157 fair value measurements adopted statement assets liabilities shown table asc 820 clarifies definition fair value prescribes methods measuring fair value establishes fair value hierarchy based inputs used measure fair value expands disclosures use fair value measurements adoption asc 820 material impact fair value measurements asc 820 permits company defer recognition measurement nonfinancial assets nonfinancial liabilities january 1 2010 june 30 2013 company nonfinancial assets nonfinancial liabilities recognized disclosed fair value asc 820 requires financial assets liabilities reported fair value categorized one following types investments based upon methodology determining fair value level 1 quoted prices active markets identical assets liabilities level 2 observable inputs level 1 prices quoted prices similar assets liabilities quoted prices markets active inputs observable corroborated observable market data substantially full term assets liabilities level 3 unobservable inputs supported little market activity significant fair value assets liabilities company utilizes various approaches measure fair value availableforsale securities assets measured fair value recurring basis summarized company financial liabilities measured fair value recurring basis availableforsale securities company uses various approaches measure fair value availableforsale securities applying threelevel valuation hierarchy disclosures specified asc 820 level 1 securities measured using quoted prices active markets identical assets liabilities company’s policy regarding transfers andor level 3 depends trading activity security volatility security observable units clearly represents fair value security level 3 security measured using fairly represented fair value transfer securities either level 1 level 2 depending type inputs revenue recognition company’s revenue recognition policies compliance asc 13 previously staff accounting bulletin sab 104 company recognizes consulting advisory fee revenues transaction completed service fees earned expenses recognized period corresponding liability incurred payments received relevant criteria revenue recognition recorded unearned revenue advertising company expenses advertising costs incurred advertising costs years ended june 30 2013 2012 4477 1865 respectively comprehensive income loss asc 2201045 previously sfas 130 reporting comprehensive income establishes standards reporting display comprehensive income components accumulated balances comprehensive income defined include changes equity except resulting investments owners distributions owners among disclosures sfas 130 requires items required recognized current accounting standards components comprehensive income reported financial statement displayed prominence financial statements june 30 2013 2012 respectively comprehensive income loss presented accompanying consolidated balance sheets income taxes company accounts income taxes accordance asc 740 previously sfas 109 “accounting income taxes” deferred taxes provided liability method whereby deferred tax assets recognized deductible temporary differences deferred tax liabilities recognized taxable temporary differences temporary differences reported amounts assets liabilities tax bases deferred tax assets reduced valuation allowance opinion management likely portion deferred tax assets realized deferred tax assets liabilities adjusted effects changes tax laws rates date enactment reporting segments asc 280 previously statement financial accounting standards 131 disclosures segments enterprise related information supersedes statement financial accounting standards 14 financial reporting segments business enterprise establishes standards way public enterprises report information operating segments annual financial statements requires reporting selected information operating segments interim financial statements regarding products services geographic areas major customers asc 280 defines operating segments components enterprise separate financial information available evaluated regularly chief operating decision maker deciding allocate resources assessing performance company operated one segment generated revenues years ended june 30 2013 2012 risks uncertainties normal course business company subject certain risks uncertainties company provides service receives marketable securities upon execution transactions consequently value securities received customers affected economic fluctuations customer’s business growth actual realized value securities could significantly different recorded value recent accounting pronouncements update 201311income taxes topic 740 presentation unrecognized tax benefit net operating loss carryforward similar tax loss tax credit carryforward exists consensus fasb emerging issues task force download july 2013 effective fiscal years interim periods within years beginning december 15 2013 nonpublic entities amendments effective fiscal years interim periods within years beginning december 15 2014 early adoption permitted update 201309fair value measurement topic 820 deferral effective date certain disclosures nonpublic employee benefit plans update 201104 download july 2013 deferral amendment effective upon issuance financial statements issued update 201307presentation financial statements topic 205 liquidation basis accounting download april 2013 effective entities determine liquidation imminent annual reporting periods beginning december 15 2013 early adoption permitted update 201304liabilities topic 405 obligations resulting joint several liability arrangements total amount obligation fixed reporting date consensus fasb emerging issues task force download february 2013 effective fiscal years interim periods within years beginning december 15 2013 nonpublic entities amendments effective fiscal years ending december 15 2014 interim periods annual periods thereafter update 201302comprehensive income topic 220 reporting amounts reclassified accumulated comprehensive income download february 2013 public entities amendments effective prospectively reporting periods beginning december 15 2012 nonpublic entities amendments effective prospectively reporting periods beginning december 15 2013 early adoption permitted update 201301balance sheet topic 210 clarifying scope disclosures offsetting assets liabilities download january 2013 entity required apply amendments fiscal years beginning january 1 2013 interim periods within annual periods entity provide required disclosures retrospectively comparative periods presented effective date effective date update 201111 company either evaluated currently evaluating implications pronouncements possible impact may company’s financial statements cases management determined pronouncement either limited application company cases implementation would material impact financial statements taken whole note 3 loans receivable related parties loans receivable related parties consist following june 30 2013 2012 note 4 assets comprise following june 30 2013 2012 note 5 marketable equity securities available sale company’s marketable securities classified availableforsale carried fair value securities comprised shares common stock investee securities classified availableforsale may sold response changes interest rates liquidity needs purposes investment marketable securities represents less twenty percent 20 outstanding common stock equivalents investee security nationally quoted national association securities dealers otc bulletin board “otcbb” pink sheets investment accounted accordance provisions sfas 115 marketable securities classified available sale consisted 1746500 shares vietnam mining corporation kna vanguard mining corporation public company traded otc markets trading symbol vnmc earned consulting services rendered fair value shares received 174650 september 30 2011 september 30 2011 recorded 600000 4000000 shares common stock agent 155 media corp fully reporting company traded otcqb time symbol agmc consulting services rendered agent155 media corp phi group inc used closing price 015 per share september 30 2011 recording purpose december 31 2011 recorded 120000 4000000 shares common stock agent 155 media corp fully reporting company traded otcqb symbol agmc time consulting services rendered agent155 media corp phi group inc used closing price 003 per share december 31 2011 recording purpose realized gain loss transaction quarter ended march 31 2012 converted 4614125 promissory note exchange 3076073 shares common stock agent155 media corp fully reporting company traded otcqb time symbol agmc used closing price 0015 per share march 31 2012 quarter sold 2000000 shares common stock agent155 media corp third party purchased price 0001 per share recorded loss 28000 quarter ended september 30 2012 company sold 500000 shares common stock agent155 media corporation price 00286 per share quarter ended december 31 2012 company purchased 20000 shares common stock agent155 media corporation average price 000536 per share february 12 2013 company purchased 8800000 shares common stock agent155 media corporation officer company price 0001 per share february 12 2013 company purchased 8800000 shares common stock agent155 media corporation officer company price 0001 per share officer purchased shares price per share nonaffiliate shareholder agent155 media corporation note 18 related party transactions note 6 property equipment june 30 2013 company property equipment note 7 receivable fiscal year ended june 30 2011 philand vietnam ltd wholly owned subsidiary philand ranch ltd made security deposit amount 172203 chu lai open economic zone authority quang nam province vietnam guarantee pointe91 development project bien rang chu lai nui thanh district quang nam province vietnam amount later transferred ky ha chu lai investment development llc “khclidc” deposit clearing land resettlement residents pointe91 project area result discontinuance pointe91 development project company entitled receive refund deposit amount less expenses incurred connection land clearing resettlement activity recorded amount receivable philand vietnam ltd received vnd 15 billion back khclidc january 21 2014 50000 transferred phi group inc january 23 2014 year ended june 30 2011 company signed consulting agreement assist agent155 media corp delaware corporation respect corporate restructuring business combination freshwater technologies inc nevada corporation part restructuring requirements company made payment manning elliot llp amount 24476 behalf freshwater technologies inc loan amounts agent155 media corp june 30 2013 agent155 media corp still owed company 66955 january 10 2013 company issued 3288443 shares restricted common stock deposit towards total purchase price 70 equity interest pt tambang sekarsa adadaya recorded value shares par total 3288 june 30 2013 amount owed agent155 media corp par value deposit shares reported assets note 8 discontinued operations company decided recognize businesses phi gold corp formerly phi mining corporation providential vietnam ltd phi energy corp philand ranch ltd united kingdom corporation together whollyowned subsidiaries philand corporation usa philand ranch ltd singapore philand vietnam ltd discontinued operations june 30 2012 practical business accounting purposes company recorded total 2234327 liabilities potential liability contingencies written nonperforming assets associated discontinued operations accompanying consolidated financial statements june 30 2013 note 9 accounts payable accrued expenses accounts payable accrued expenses june 30 2013 2012 consist following note 10 due officer due officer represents advances made officers company subsidiaries noninterest bearing except 100000 described unsecured due demand june 30 2013 2012 balances 1444598 1489072 respectively june 30 2013 company short term note payable amounting 100000 interest bearing 3000 per month payable member board directors note 11 loans promissory notes short term notes payable june 30 2013 june 30 2012 company short term notes payable amounting 1456426 2125456 accrued interest 2952261 2509944 respectively notes bear interest rates ranging 6 36 per annum 1167480 shortterm notes past due 258976 due demand notes payable secured assets company summarized convertible promissory note last convertible promissory note issued asher enterprises inc “asher” june 17 2011 42500 interest 8 per annum due payable march 21 2012 note convertible election asher time issuance date 39 discount average lowest closing bid prices company’s common stock ten trading day period ending latest complete trading prior conversion date event default amount principal interest paid due bear interest rate 22 per annum note becomes immediately due payable occur company liable pay asher 150 outstanding principal interest note agreements contain covenants requiring asher’s written consent certain activities existence committed company issue date note outstanding note principal interest amounts accrued thereon converted whole part time asher issuance date equivalent company’s common stock determined discount rate mentioned note additionally note contains reset provision exercise price conversion price company issues equity derivatives price less exercise price set forth warrants note ratchet provision results derivative liability financial statements july 25 2011 10000 principal convertible note issued january 11 2011 converted equivalent 1550 shares postsplit common stock company 2325581 presplit shares august 8 2011 12000 principal convertible note issued january 11 2011 converted equivalent 1633 shares postsplit common stock company 2448980 presplit shares august 30 2011 15000 principal convertible note issued january 11 2011 converted equivalent 2941 shares postsplit common stock company 4411765 presplit shares october 21 2011 8000 principal convertible note issued january 11 2011 converted equivalent 2667 shares postsplit common stock company 4000000 presplit shares november 22 2011 10000 principal convertible note issued january 11 2011 converted equivalent 5083 shares postsplit common stock company 7625000 presplit shares january 03 2012 10000 principal convertible note issued june 17 2011 converted equivalent 4444 shares postsplit common stock company 6666667 presplit shares january 11 2012 11000 principal convertible note issued june 17 2011 converted equivalent 5641 shares postsplit common stock company 8461538 presplit shares march 1 2012 12000 principal convertible note issued june 17 2011 converted equivalent 5741 shares postsplit common stock company 8571429 presplit shares april 23 2012 asher enterprises inc converted 7000 principal amount convertible note dated june 17 2011 8197 shares postsplit common stock company price 0854 per share june 30 2013 total outstanding balance amount due asher enterprises inc 3750 due preferred stockholders company classified 215000 preferred stock subscribed current liability payable holders preferred stock previously discontinued subsidiary company due non compliance preferred shares subscription agreement year 2000 company made offer preferred stock holders receive shares common stock company exchange preferred shares far preferred shareholders accepted offer interest expenses payable holders preferred stock 335855 310055 included accrued interest included account payable accrued expenses balance sheets june 30 2013 june 30 2012 respectively advances customers previously classified unearned revenue september 30 2012 company decided reclassify previously recorded unearned revenues advances customers company able complete consulting services related clients due inability provide gaapcompliant audited financial statements order file registration statement securities exchange commission june 30 2013 company recorded 563219 advances customers note 12 litigation legal proceeding settled unpaid june 30 2013 quang van cao nhan thi nguyen cao vs providential securities inc et al case originally submitted orange county superior court ca june 25 1997 case 781121 subsequently moved nasd dispute resolution arbitration august 24 2000 company’s legal counsel negotiated claimant’s counsel unilaterally reached settlement approved company process renegotiating terms said settlement claimants filed request arbitration hearing national association securities dealers october 4 2000 case 9903160 thereafter claimants filed complaint orange county superior court ca october 31 2000 case 00cc13067 alleged breach contract damages sum 75000 plus prejudgment interest costs incurred connection complaint relief without admitting denying allegations company reached settlement agreement claimants whereby company would pay claimants total 62500 plus 4500 administrative costs date report company paid 2500 subject entry judgment 79000 may 2011 claimants filed application renewal judgment total 14049078 amount accrued accompanying consolidated financial statements william davidson vs doan et al february 01 2010 company notified suit filed superior court state california county los angeles november 24 2009 william h davidson individual martin doan henry fahman benjamin tran hrciti corporation providential capital inc subsidiary company nka phi capital holdings inc collectively referred “defendants case bc 426831 plaintiff demanded amount less 14000000 defendants promissory notes outstanding plaintiff company july 09 2012 william davidson phi capital holdings inc reached settlement agreement whereby phi capital agreed pay william davidson total 200000 period nineteen months beginning september 1 2012 william davidson elected convert portion total amount common stock phi group inc lieu cash payment addition company paid william davidson 100000 shares vietnam mining corporation company accrued liabilities associated promissory notes accompanying consolidated financial statements june 30 2013 note 23 subsequent event note 13 payroll liabilities payroll liabilities accrued recorded accrued expenses consolidated balance sheet june 30 2013 company owed internal revenue service state california employment development department payroll tax penalties interest amounting 118399 company currently working internal revenue service state california employment department resolve matters note 23 subsequent event note 14 basic diluted net loss per share net loss per share calculated accordance sfas 128 “earnings per share” provision sfas 128 basic net loss per share computed dividing net loss period weightedaverage number common shares outstanding period diluted eps based weightedaverage number shares common stock outstanding period common stock equivalents outstanding end period basic diluted weighted average numbers shares year ended june 30 2011 since inclusion common stock equivalents antidilutive note 15 stockholder’s equity total number authorized capital stock company 400000000 shares par value 0001 per share consisting 300000000 shares voting common stock par value 0001 per share 100000000 shares preferred stock par value 0001 per share rights terms associated preferred stock determined board directors company march 15 2012 company effectuated 1 1500 reverse split company’s common stock treasury stock balance treasury stock june 30 2013 2987 postsplit shares valued 3801 common stock july 19 2012 officer company converted total 307000 debts owed company 1196424 shares phi group inc’s restricted common stock july 31 2012 seven creditors company converted total 17733333 debts owed company 504865 shares phi group inc’s common stock november 19 2012 company reserved 5673327 shares common stock special dividend distribution november 30 2012 four creditors company converted total 22007906 debts owed company 81737 shares phi group inc’s common stock january 10 2013 company issued 3288443 shares phi group inc’s common stock registered name majority shareholder pt tambang sekarsa adadaya deposit towards total purchase price 70 equity interest pt tambang sekarsa adadaya february 14 2013 two creditors company converted total 150000 debts owed company 155885 shares phi group inc’s common stock february 22 2013 company issued 44763 shares phi group inc’s common stock valued 50000 indonesian attorney payment legal services connection purchase pt tambang sekarsa adadaya february 22 2013 creditor company converted total 33633 debts owed company 44844 shares phi group inc’s common stock april 11 2013 creditor company converted 50000 owed company 76540 shares phi group inc’s common stock april 26 2013 three creditors company converted total 180000 debts owed company 304913 shares phi group inc’s common stock may 10 2013 company issued 25510 shares restricted common stock 10000 cash rule 144 working capital may 10 2013 company issued 75377 shares restricted common stock 30000 cash rule 144 working capital june 30 2013 5979990 postsplit shares company’s 0001 par value common stock issued outstanding excluding 5673327 shares reserved special dividend distribution 7485 shares reserved potential conversion debt creditor september 19 2014 12412114 postsplit shares company’s 0001 par value common stock issued outstanding including 5673327 shares reserved special dividend distribution 7485 shares reserved potential conversion debt creditor preferred stock preferred stock issued outstanding shares issued june 08 2006 luberski inc transferred subsequently sold 1000000 presplit shares common stock phi group inc belonging officer company given luberski inc collateral loan company june 30 2007 company agreed pay back 1000000 presplit shares valued 57000 officer recorded transaction shares issued july 19 2012 company issued 174713 shares 0001 par value common stock valued 57000 total officer satisfy obligation herein note 16 stock based compensation plan stockbased compensation february 7 2005 company adopted stockbased compensation plan set aside 14000000 shares common stock selected eligible participants company subsidiaries certain independent contractors providing certain services company prior july 1 2006 company measured stock compensation expense using intrinsic value method accounting accordance accounting principles board apb opinion 25 “accounting stock issued employees” related interpretations apb 25 company adopted sfas 123r effective july 1 2006 using modified prospective method warrants quarter ended september 30 2006 company issued 250000 stock warrants term 5 years three year vesting period warrants expired august 30 2011 note 17 loss settlement debts years ended june 30 2013 june 30 2012 company recorded loss 0 32808 settlement debts respectively result issuance shares common stock asher enterprises note conversions note 18 related party transactions year ended june 30 2013 company purchased 8800000 shares common stock agent155 media corporation officer company price 0001 per share officer purchased shares price per share nonaffiliate shareholder agent155 media corporation company accrued 210000 salaries henry fahman president company tina phan secretary company years ended june 30 2013 june 30 2012 note 19 income taxes provision made income tax since company significant net operating loss carry forward june 30 2013 company incurred net operating losses tax purposes approximately 36699000 net operating loss carry forward may used reduce taxable income year 2030 net operating loss carry forwards state california generally available reduce taxable income year 2020 availability company’s net operating loss carryforward subject limitation 50 positive change ownership company’s stock see note 2 “under section 6501a internal revenue code tax code section 3016501a1a income tax regulations tax regulations irs required assess tax within 3 years tax return filed irs company’s 2011 2012 2013 tax return open may subject examination taxing authorities” note 20 contracts commitments agreement hawk associates inc august 11 2006 company entered investor relations consulting agreement hawk associates inc florida corporation effective september 1 2006 according agreement hawk associates would provide investor relations consulting services company period six months agreement would automatically renew monthly notice provided one parties company agreed pay hawk associates 4500 per month investor relations consulting services hawk associates would issued warrants purchase 250000 common shares company based closing price 0015 per share september 1 2006 warrants expired august 30 2011 business financial consulting agreement mast ventures llc effective april 1 2008 company entered business financial consulting agreement mast ventures llc raise capital wholly owned subsidiary philand corporation 5 years service includes assistance identifying potential investors developing approach seeking current financing investor relations company agreed pay 5 total funds raised consultant business financial consulting agreement thinh hung investment co effective may 21 2010 company signed agreement thinh hung investment co ltd vietnambased company assist thinh hung identifying locating possibly acquiring various business opportunities thinh co ltd subsidiary thinh hung including limited reverse merger stock swap business combination thinh publiclytraded company us exchange services rendered company would receive compensation cash thinh hung common stock combined company september 30 2011 company completed stock purchase investment agreement thinh anh co ltd vietnam foods corporation nevada corporation however combined company filed registration statement securities exchange commission become reporting company due thinh hung co’s inability complete required gaapcomplaint financial audits pcaobregistered auditing firm far company recognized 26656 revenues transaction balance 293219 booked advances customers liability portion balance sheet agreement purchase sale pt bindakar december 17 2011 company signed agreement purchase sale pt bindakar indonesia corporation acquire approximately 2670 hectares coal concession marga mulya kecamatan rambah samo kabupaten rokan hulu propinsi riau indonesia pt bindakar total purchase price twenty five billion indonesian rupiahs according agreement pt bindakar pay liabilities related acquired assets obtain valid iup production license coal concession prior intended closing date march 31 2012 agreement may terminated time prior closing date mutual agreement pt bindakar company b another buyer acquired assets close transaction sooner company c pt bindakar unable obtain iup production license march 30 2012 unless parties agree extend date writing material breach either party material representation warranty covenant agreement set forth agreement cured reasonable satisfaction party within ten business days notice breach given informing party e transaction contemplated agreement purchase sale consummated march 31 2012 unless parties agree extend closing date writing f injunction order governmental entity competent authority prevents consummation transaction contemplated agreement march 31 2012 agreement purchase sale became null void due fact pt bindakar unable obtain iup production license date mentioned agreement powerdyne industries llc december 5 2011 company signed business cooperation agreement powerdyne industries llc california limited liability company stn group llc california limited liability company introduce powerdyne’s clean coal combustion technologies potential power plant owners operators various geographical areas limited powerdyne’s worldwide rights agreement expired one year signing date agreement sao nam group december 22 2011 company signed memorandum understanding investment quang tri power plant project central vietnam sao nam group vietnamese company introduce provide necessary financial technical services well longterm coal supply project indonesia june 30 2012 company pursued project mainly due sao nam group’s prioritized focus shipping port services agreements hoang ngoc joint stock company december 23 2011 company signed business cooperation agreement hoang ngoc joint stock company vietnamese corporation cooperate hoang ngoc co order obtain investment license provide required technologies arrange investment capital purpose establishing operating one coalfire power plants giang province vietnam specifically phi shall invest cause invested required capital conjunction andor via qualified affiliates partners hereinafter referred “principal investors” longstanding operational history area thermal power provide cause provided required technical expertise conjunction andor via qualified affiliates partners establish operate maintain power plants grant power plants first right refusal certain coal supplies owned controlled phi lifetime power plants subject terms conditions detailed subsequent agreements march 18 2012 indochina energy ltd newformed subsidiary company signed investment agreement hoang ngoc joint stock company jointly cooperate hoang ngoc co order obtain investment license provide required technologies arrange investment capital purpose establishing operating one coalfire power plants giang province vietnam accordance business cooperation agreement dated december 23 2011 company hoang ngoc co investment agreement subsequently superseded replaced investment agreement dated april 5 2012 whereby phi group inc covenants continue provide clean coal technology longterm coal supply power plants pursuant aforementioned business cooperation agreement dated december 23 2011 following demise hoang ngoc’s founder chairman company decided discontinue project agreement global sun wind power corp april 27 2012 company signed business cooperation agreement global sun wind power corp nevada corporation cooperate gswp introduce gswp technologies countries southeast asia viz brunei burma east timor cambodia laos malaysia philippines singapore thailand vietnam india new papua guinea australia develop finance implement business plans using gswp technologies electricity generation geographical areas restricted agreements contracts either gswp company party global sun wind power manufactures one innovative wind turbines world market today also offers complete hybrid power systems incorporating wind solar minihydro diesel backup systems stateofthe art battery storage technologies gswp’s systems highly efficient gridconnected offgrid applications business cooperation agreement expired one year signing date corporate combination agreement provimex inc hpita jsc june 19 2012 provimex inc changed name hpita corporation july 20 2012 hpita corporation “hpus” signed corporate combination agreement acquire issued outstanding stock hpita joint stock company organized existing laws vietnam exchange solely amount authorized unissued common stock hpus equal 95 issued outstanding shares hpus’s common stock immediately following issuance shares hpus intends complete required financial audits file form 10 registration statement securities exchange commission become separate fully reporting publicly traded company us date report hpus filed registration statement securities exchange commission agreement global development systems inc august 11 2012 company signed business cooperation agreement global development systems inc texas corporation market renewable energy electricity generation using global development systems inc’s proprietary hydromagnetic gravitational renewable energy technologies term agreement two years office rental agreements august 11 2012 company signed agreement rent business center office las vegas nevada approximately 100 per month plus administrative expenses oneyear term rental agreement expired august 31 2013 renewed another twelvemonth term expire august 31 2014 agreement makani power inc august 16 2012 company signed business cooperation agreement makani power inc delaware corporation market renewable energy electricity generation system using makani power’s proprietary airborne wind turbine technology term agreement two years agreement happenex holding bv december 22 2012 company signed business cooperation agreement happenex holding bv dutch corporation cooperate international trade coal natural resource commodities term agreement two years agreement purchase sale pt tambang sekarsa adadaya december 24 2012 company signed agreement purchase sale pt tambang sekarsa adadaya “tsa” indonesian limited liability company holders minimum seventy percent 70 equity ownership tsa acquire seventy percent 70 equity interest tsa exchange total purchase price ten million five hundred thousand us dollars us 10500000 cash stock company tsa currently owns two coal concessions together operation production licenses izin usaha pertambangan operasi produksi pertinent licenses permits covering total area 9690 hectares purportedly containing approximately 205 million metric tonnes indicative coal resources kecamatan baras sarudu kabupaten mamuju utara propinsi sulawesi barat indonesia january 10 2013 company issued 3288443 shares common stock phi group inc deposit towards total purchase price march 16 2013 company signed amendment tsa majority shareholder tsa extend closing date transaction june 30 2013 company engaged pt runge indonesia subsidiary rungepincockminarco australian company conduct independent technical due diligence tsa coal concessions esp law firm indonesia legal firm conduct legal due diligence tsa since technical legal financial due diligence results incomplete extension date transaction terminated june 30 2013 however company tsa recently continued renegotiate terms conditions revised transaction agreement hpita jsc january 11 2013 company signed business cooperation agreement hpita joint stock company organized existing laws vietnam participate international trade base precious metals crossborder financial intermediation term agreement two years business financial consulting agreement january 16 2013 phi capital holdings inc subsidiary company signed consulting agreement hpi company organized existing laws vietnam provide business consulting services hpi term agreement six months fee compensation one hundred thousand us dollars june 30 2013 phi capital holdings completed services consulting agreement received compensation agreement esp law firm january 25 2013 company signed agreement retain esp law firm indonesian advocate legal consultant firm conduct legal due diligence behalf company connection pt tambang sekarsa adadaya acquisition company agreed pay esp law firm 10000 cash 50000 restricted common stock phi group inc’s legal services related contemplated acquisition agreement colebrand international ltd january 28 2013 company signed business cooperation agreement colebrand international ltd company organized existing laws united kingdom cooperate international trade financial intermediation term agreement two years agreement pt runge indonesia february 6 2013 company signed agreement retain pt runge indonesia subsidiary rungepincockminarco australian company provide technical assistance company developing potential jorc resources reserves statement open cut coal deposit pt tambang sekarsa adadaya’s concessions located sulawesi barat indonesia according agreement pt runge indonesia conduct technical due diligence several stages order provide estimate resources reserves compliant jorc code company invoiced work progresses agreement paca february 25 2013 phi capital holdings inc subsidiary company signed consultingengagement agreement paca new york corporation contemplate raising capital purpose financing phi group inc’s business plan including acquisition various energy properties general working capital term engagement two years paca entitled cash success fee equity success fee successful financing transaction agreement purchase sale pt harjo mas makmur march 16 2013 company signed agreement purchase sale pt harjo mas makmur “hmm” indonesian limited liability company holders minimum ninetyfive percent 95 equity ownership hmm acquire ninetyfive percent 95 equity interest hmm exchange total purchase price eight million five hundred fifty thousand us dollars us 8550000 cash stock company hmm currently owns producing coal concession operation production licenses izin usaha pertambangan operasi produksi pertinent licenses permits covering total area 745 hectares kelurahan mentawir kecamatan sepaku kabupaten penajam paser utara propinsi kalimantan timur indonesia together production support transportation facilities june 16 2013 company decided pursue transaction due unsatisfactory due diligence results termination business cooperation agreement global sun wind power corp business cooperation agreement global sun wind power corp expired one year april 26 2013 parties chose renew agreement indonesian office rental agreement may 7 2013 company signed agreement pt karya central bisnis indonesian company rent business center office pondok indah south jakarta indonesia term agreement one year expire may 2014 unless renewed agreement pt raksasa metal agung june 29 2013 company signed business cooperation agreement pt raksasa metal agung “agung” indonesian company codevelop gold mining projects central java indonesia subsequently agung company signed two addenda business cooperation agreement dated october 7 2013 january 29 2014 respectively set forth capital requirements gold mining projects profit sharing agreement according addenda company entitled 60 agung 40 net profits derived operations second addendum also allows company right assign responsibilities benefits connection business cooperation agreement vietnam mining corporation “vnmc” nevada corporation another entity april 29 2014 company signed assignment agreement assign convey transfer rights interests obligations connection said business cooperation agreement addenda vnmc part said assignment agreement company also committed arranging required capital vnmc codevelop gold mining opportunities central java indonesia agung vnmc agreed issue two million shares 0001 par value common stock company consideration said assignment agreement note 21 going concern uncertainty shown accompanying consolidated financial statements company accumulated deficit 36699002 negative cash flow operations amounting 884047 period ended june 30 2013 factors well uncertain conditions company faces daytoday operations respect cash flows create uncertainty company’s ability continue going concern financial statements include adjustments might necessary company unable continue going concern management taken action strengthen company’s working capital position generate sufficient cash would meet operating needs june 30 2014 beyond next twelve months company would focus energy natural resources including investing developing coal assets independent power plant projects renewable energy industrial minerals well engaging international trade phi capital holdings inc company’s wholly owned subsidiary would also continue provide corporate project finance services including merger acquisition advisory consulting services companies variety industries arranging funding energyrelated natural resource infrastructure projects company anticipated generating revenues proposed mergers acquisitions well business activities mentioned herein assurances could made management would successful achieving plan president chairman company committed funding company’s operations next 12 months note 22 noncontrolling interests subsidiaries year ended june 30 2011 company following noncontrolling interests number subsidiaries fiscal years ended june 30 2012 june 30 2013 subsidiaries classified discontinued operations note 23 subsequent event financial statements approved management available issuance september 19 2014 subsequent events evaluated date agreement pacific energy network august 16 2013 company signed business cooperation agreement pacific energy network inc washington corporation cooperate develop implement conventional renewable energy business projects geographical areas terms conditions mutually acceptable parties term agreement two years withdrawal pointe91 hospitality development project philand ranch ltd september 20 2013 philand vietnam limited whollyowned subsidiary philand corporation submitted request chu lai open economic zone authority “cloeza” quang nam province voluntarily withdraw pointe91 hospitality development project tam quang village nui thanh district quang nam province surrender investment license due changed market conditions meeting held october 28 2013 among cloeza ky ha chu lai investment development company “khclidc” philand vietnam ltd cloeza agreed philand vietnam ltd’s request termination pointe91 development project instructed appropriate cloeza departments khclidc return unspent deposits philand vietnam ltd assist termination process november 2013 khclidc philand vietnam ltd signed settlement agreement terminate previously executed land clearance compensation agreement two companies agreed khclidc would return vnd 2705349242 deposit amount philand vietnam ltd agreement vinabenny energy joint stock company november 12 2013 company signed business cooperation investment agreement vinabenny joint stock company vietnamese company cooperate codevelop invest cause invested implement operate 84000 mt lpg terminal project giuoc district long province vietnam parties agree roles responsibilities benefits party connection terminal project separate subsequent agreement term agreement one year agreement ne nord energy joint stock company november 14 2013 company signed business cooperation investment agreement ne nord energy joint stock company vietnamese company cooperate codevelop invest cause invested produce market sell led lighting solar energy kinetic power supply system renewable energy energyrelated products services geographical areas markets deem economically beneficial parties term agreement two years business financial consulting agreement asia green corp january 17 2014 phi capital holdings inc whollyowned subsidiary company signed business financial consulting agreement asia green llc “asia green vn” vietnamese company engaged afforestation reforestation projects vietnam assist asia green becoming fully reporting publicly traded company united states arranging capital asia green execute business plan phi capital holdings entitled receive six hundred twenty thousand us dollars compensation services rendered term agreement one year asia green become fully reporting public company april 4 2014 touchlink communications inc nevada corporation majorityowned subsidiary company changed name asia green corporation entered corporate combination agreement asia green vn become holding company asia green vn’s agroforestry afforestation business july 28 2014 asia green corporation changed name omni resources inc stock purchase agreements common stock vietnam mining corporation january 24 2014 company signed stock purchase agreements acquire total fourteen million shares common stock vietnam mining corporation “vnmc” nevada corporation two individuals total purchase price 14117500 closing transactions scheduled occur twentieth business day following vnmc’s regaining current good standing status state nevada otc markets transfer agents depository trust corporation pertinent entities consulting engagement agreement vietnam mining corporation nka vanguard mining corporation january 24 2014 phi capital holdings inc whollyowned subsidiary company signed consulting engagement agreement vietnam mining corporation “vnmc” nevada corporation assist vnmc regain current good standing status pertinent regulatory agencies united states certain private service providers seek new business opportunities vnmc phi capital holdings entitled receive four million shares restricted common stock vnmc pursuant provisions rule 144 compensation services rendered term agreement six months memorandum understanding pt bumi permata indonesia january 29 2014 company signed memorandum understanding “mou” pt bumi permata indonesia indonesian company codevelop 199hectare coal concession kecamatan rantau pandan kabupaten bungo provinsi jambi indonesia parties agree sign definitive agreement containing representations warranties covenants indemnities customary transaction time within 30 days following date mou memorandum understanding pt cendrawasih international january 29 2014 company signed memorandum understanding “mou” pt cendrawasih international indonesian company codevelop 8100hectare gold concession kecamatan kotannopan tambangan kabupaten mandailing natal sumatra utara indonesia parties agree sign definitive agreement containing representations warranties covenants indemnities customary transaction time within 30 days following date mou also allows company right assign responsibilities benefits connection project vietnam mining corporation nevada corporation another entity memorandum understanding cv sindo makmur coal mining january 31 2014 company signed memorandum understanding “mou” cv sindo makmur coal mining indonesian company codevelop operate various coal metal concessions indonesia particularly 100hectare coal concession dondang kecamatan muara jawa kabupaten kutai kartanegara east kalimantan 11960hectare coal concession bukit pinang kecamatan samarinda ulu kota samarinda east kalimantan indonesia parties agree sign definitive agreement containing representations warranties covenants indemnities customary transaction time within 30 days following date mou funding agreement regarding petrobras bonds february 4 2014 company signed funding agreement dieterich group robert terry provide 300000 likely increasing 400000 funding best efforts nonexclusive basis underwrite collection efforts undertaken series 500 bonds originally issued petrobras brazilian corporation focused oil gas exploration development bonds currently owned controlled starboard financial nevada llc recent valuation report bonds published discounted value 750000 including 7 interest february 2008 possible published redemption face value 2300000 according funding agreement company receive total recovery 10 times investment funding 125 net proceeds assuming entire funding provided company andor investors bond collections deduction trading selling expenses brazilian agents starboard financial brazilian parties received first 20000000 recovered assisting vanguard mining corporation fka vietnam mining corporation acquisition limestone concession indonesia quarter ended june 30 2014 company provided consulting service assisted vietnam mining corporation nka vanguard mining corporation trading symbol “vnmc” acquire 75 equity interest pt mega kencana persada “mkpi” indonesian company owns limestone tenement approximate 330 hectares iup exploration license 540112k2012 dated january 27 2012 desa sipapaga kecamatan panyabungan kabupaten mandailing natal sumatra utara republic indonesia estimated amount limestone deposits concession area 150000000 metric tons subject independent verification company also committed arranging required capital vnmc develop limestone concession mkpi vnmc agreed issue three million shares 0001 par value common stock company consideration transaction consulting agreement independent senior geologist april 30 2014 company signed consulting agreement independent senior geologist certain necessary technical services required connection review survey evaluation recommendation mining opportunities mineral assets including limited gold copper limestone coal manganese iron ores indonesia elsewhere may approved adopted company term agreement two years company agreed pay consultant one million shares common stock vietnam mining corporation nka vanguard mining corporation duration agreement payments payroll liabilities april 29 2014 chairman president company made payment amount 1928994 employment development department state california another payment amount 4197422 department treasury internal revenue service behalf company accrued payroll tax liabilities stock payment william h davidson april 8 2014 company transferred 100000 shares common stock vietnam mining corporation nka vanguard mining corporation trading symbol vnmc balance vnmc shares held phi capital holdings inc william h davidson payment towards settlement amount owed company note 12 litigation payment luberski inc april 29 2014 chairman president company made payment amount 32228500 luberski inc settle outstanding balances principal accrued interest loan dated march 30 2009 behalf company addition april 8 2014 phi capital holdings inc paid 15000 shares common stock vietnam mining corporation kna vanguard mining corporation luberski inc assignee part settlement agreement issuances company’s common stock july 1 2013 three creditors company converted total 117940 debts owed company 412569 shares phi group inc’s common stock february 11 2014 creditor company converted total 156750 debts owed company 337097 shares phi group inc’s common stock business cooperation agreement dayak united energy llc august 25 2014 company signed business cooperation agreement dayak united energy llc nevada limited liability company “due” cooperate arrange financing mine market sell coal products due’s current joint operation contracts mine owners kalimantan well joint operation contracts due able secure future addition parties may time cooperate jointly engage business activities deem mutually desirable beneficial parties business cooperation investment agreement pt ray wolter energi september 10 2014 company signed business cooperation investment agreement pt ray wolter energi rwe member raywolter group company duly organized existing virtue laws republic indonesia primarily cooperate respect 1 developing two 225mw thermal power plants east kalimantan two 50mw thermal power plants north sulawesi two 50mw thermal power plants nusa tenggara timur 2 manufacturing installing 1000 electricity transmission towers addition communications towers across indonesia 3 mining coal supply indonesian domestic export customers well pertinent business activities deemed beneficial parties phi shall utilize best efforts invest andor cause invested rwe andor respective projects provide andor cause provided best possible technologies engineering procurement construction epc services jointly develop construct operate projects mentioned herein rwe phi enter separate definitive agreement includes specific terms conditions obligations benefits representations warranties covenants indemnities customary transaction type respect projects mentioned herein moreover rwe phi may time cooperate jointly engage business activities deem mutually acceptable beneficial parties item 9 item 8 financial statements phi group inc independent auditor’s report board directors stockholders phi group inc formerly providential holdings inc report independent registered public accounting firm board directors shareholders phi group inc audited accompanying consolidated balance sheets phi group inc “company” subsidiaries june 30 2017 2016 related consolidated statements operations shareholders’ deficit cash flows years ended financial statements responsibility company’s management responsibility express opinion financial statements based audits conducted audits accordance standards public company accounting oversight board united states standards require plan perform audit obtain reasonable assurance whether financial statements free material misstatement audit includes examining test basis evidence supporting amounts disclosures financial statements audit also includes assessing accounting principles used significant estimates made management well evaluating overall financial statement presentation believe audits provide reasonable basis opinion audits included consideration internal control relevant company’s preparation fair presentation financial statements order design audit procedures appropriate circumstances purpose expressing opinion effectiveness entity’s internal control accordingly express opinion financial statements referred present fairly material respects financial position phi group inc june 30 2017 2016 results operations cash flows years ended conformity accounting principles generally accepted united states america accompanying financial statements prepared assuming company continue going concern discussed note 22 financial statements company accumulated deficit 39299754 total liabilities stockholders’ deficit 7513481 june 30 2017 factors raise substantial doubt company’s ability continue going concern management’s plan regard also described note 22 financial statements include adjustments might result outcome uncertainty dave banerjee cpa accountancy corporation dave banerjee cpa accountancy corporation woodland hills ca 91367 october 12 2017 phi group inc subsidiaries consolidated balance sheets audited accompanying notes form integral part audited consolidated financial statements phi group inc subsidiaries consolidated statement operations audited years ended accompanying notes form integral part audited consolidated financial statements phi group inc subsidiaries consolidated statements cash flows years ended june 30 2017 2016 audited accompanying notes form integral part audited consolidated financial statements phi group inc subsidiaries statement stockholders’ equity deficit years ended june 30 2017 2016 audited accompanying notes form integral part audited consolidated financial statements phi group inc subsidiaries formerly providential holdings inc notes consolidated financial statements note 1 nature business item 1 business overview phi group inc “company” “phi” engaged mergers acquisitions principal wwwphiglobalcom company adopted plans acquire established operating businesses selective industries invest various ventures may potentially create significant longterm value shareholders addition also provide corporate finance services including merger acquisition advisory consulting services client companies wholly owned subsidiary phi capital holdings inc wwwphicapitalholdingscom assurances made company successful achieving plans originally incorporated june 8 1982 jr consulting inc nevada corporation company applied certificate domestication filed articles domestication become wyoming corporation september 20 2017 beginning company foremost engaged mergers acquisitions operating subsidiary diva entertainment inc operated two modeling agencies one new york one california following business combination providential securities inc californiabased financial services company changed name providential securities inc nevada corporation january 2000 company changed name providential holdings inc february 2000 october 2000 providential securities withdrew securities brokerage membership ceased financial services business subsequently april 2009 company changed name phi group inc october 2000 october 2011 company subsidiaries engaged mergers acquisitions advisory consulting services real estate hospitality development mining oil gas telecommunications technology healthcare private equity special situations october 2011 company discontinued operations providential vietnam ltd philand ranch limited united kingdom corporation together subsidiaries philand ranch singapore philand corporation us philand vietnam ltd vietnam phi gold corporation formerly phi mining corporation nevada corporation phi energy corporation nevada corporation mainly focused acquisition development opportunities energy natural resource businesses present company engaged mergers acquisitions principal investments natural resources energy agriculture healthcare pharmaceuticals biotechnology special situations addition phi capital holdings inc wholly owned subsidiary phi continues provide corporate project finance services including merger acquisition advisory consulting services companies variety industries note 2 summary significant accounting policies principles consolidation consolidated financial statements include accounts phi group inc wholly owned subsidiaries phi capital holdings inc abundant farms inc american pacific resources inc phi group regional center llc well discontinued operations providential securities inc phi energy corporation phi gold corp providential vietnam ltd philand ranch limited including 100 owned subsidiary philand corporation philand vietnam ltd omni resources inc cornerstone biomass corp collectively referred “company” significant intercompany transactions eliminated consolidation use estimates preparation consolidated financial statements conformity accounting principles generally accepted united states america requires management make estimates assumptions affect reported amounts assets liabilities disclosure contingent assets liabilities date financial statements reported amounts revenues expenses reporting period actual results could differ estimates cash equivalents company considers liquid investments maturity three months less date purchase readily convertible cash equivalents marketable securities company’s securities classified availableforsale carried fair value securities classified availableforsale may sold response changes interest rates liquidity needs purposes investment marketable securities typically represents less twenty percent 20 outstanding common stock equivalents investee security quoted national exchange otc markets investment accounted accordance provisions asc 320 previously sfas 115 unrealized holding gains losses availableforsale securities excluded earnings reported separate component stockholder’s equity realized gains losses securities classified availableforsale reported earnings based upon adjusted cost specific security sold june 30 2017 2016 marketable securities recorded 502696 481120 respectively based upon fair value marketable securities time accounts receivable management reviews composition accounts receivable analyzes historical bad debts june 30 2017 company accounts receivable impairment longlived assets effective january 1 2002 company adopted asc 350 previously sfas 144 “accounting impairment disposal longlived assets” addresses financial accounting reporting impairment disposal longlived assets supersedes sfas 121 “accounting impairment longlived assets longlived assets disposed of” accounting reporting provisions apb opinion 30 “reporting results operations disposal segment business” company periodically evaluates carrying value longlived assets held used accordance asc 350 asc 350 requires impairment losses recorded longlived assets used operations indicators impairment present undiscounted cash flows estimated generated assets less assets’ carrying amounts event loss recognized based amount carrying amount exceeds fair market value longlived assets loss longlived assets disposed determined similar manner except fair market values reduced cost disposal property equipment property equipment stated cost maintenance repair costs charged expense incurred costs major additions betterments capitalized property equipment sold otherwise disposed cost related accumulated depreciation eliminated accounts resulting gain loss reflected income depreciation computed using straightline method estimated useful lives assets ranging three ten years depreciation amortization cost property equipment depreciated estimated useful lives related assets depreciation amortization fixed assets computed straightline basis net earnings loss per share company adopted provisions asc 260 previously sfas 128 asc 260 eliminates presentation primary fully diluted earnings per share “eps” requires presentation basic diluted eps basic eps computed dividing income loss available common stockholders weightedaverage number common shares outstanding period diluted eps based weightedaverage number shares common stock outstanding period common stock equivalents outstanding end period net earnings loss per share computed follows stockbased compensation effective july 1 2006 company adopted asc 7181025 previously sfas 123r accordingly adopted modified prospective application method asc 7181025 applied new awards modified repurchased cancelled effective date additionally compensation cost portion awards outstanding date adoption requisite service rendered unvested options recognized period time remaining requisite services rendered fair value financial instruments fair value definition hierarchy fair value defined price would received sell asset paid transfer liability orderly transaction market participants measurement date assets liabilities measured fair value categorized based whether inputs observable market degree inputs observable categorization financial assets liabilities within valuation hierarchy based upon lowest level input significant fair value measurement fair value hierarchy inputs used measuring fair value maximizes use observable inputs minimizes use unobservable inputs requiring observable inputs used available valuation techniques consistent market income approach used measure fair value fair value hierarchy categorized three levels based inputs follows level 1 valuations based unadjusted quoted prices active markets identical assets liabilities fund ability access level 2 valuations based inputs quoted prices included level 1 observable either directly indirectly level 3 valuations based inputs unobservable significant overall fair value measurement fair value marketbased measure based assumptions prices inputs considered perspective market participant current measurement date rather entityspecific measure therefore even market assumptions readily available company’s assumptions set reflect market participants would use pricing asset liability measurement date availability valuation techniques observable inputs vary investment affected wide variety factors including type investment whether investment new yet established marketplace liquidity markets characteristics particular transaction extent valuation based upon models inputs less observable unobservable market determination fair value requires judgment inherent uncertainty valuation estimated values may materially higher lower values would used ready market investments existed accordingly degree judgment exercised fund determining fair value greatest investments categorized level 3 certain cases inputs used measure fair value may fall different levels fair value hierarchy cases level fair value hierarchy fair value measurement falls entirety determined based upon lowest level input significant fair value measurement fair value valuation techniques inputs company holds may invest public securities traded public exchanges overthecounter otc private securities real estate convertible securities interest bearing securities types securities adopted specific techniques respective valuations equity securities public companies unrestricted company values investments securities freely tradable listed major securities exchanges last reported sales price valuation date extent securities actively traded valuation adjustments applied categorized level 1 fair value hierarchy securities traded inactive markets valued reference similar instruments generally categorized level 2 3 fair value hierarchy restricted securities traded public exchanges overthecounter otc formal restrictions limit ie rule 144 holding periods underwriter’s lockups sale shall valued closing price date valuation less applicable discounts company may apply discount securities rule 144 restrictions additional discounts may assessed company believes mitigating factors warrant additional discounting determining potential additional discounts factors taken consideration include limited securities’ trading characteristics volume length overall impact restriction well macroeconomic factors valuations discounted appropriately securities may freely traded determined exchange otc listed price accurately reflect fair market value company may elect treat security private company apply alternative valuation method investments restricted securities public companies may included level 2 fair value hierarchy however extent significant inputs used determine liquidity discounts observable investments restricted securities public companies may categorized level 3 fair value hierarchy companys financial instruments primarily consist cash equivalents accounts receivable marketable securities shortterm notes payable convertible notes derivative liabilities accounts payable balance sheet dates estimated fair values financial instruments materially different carrying values presented balance sheet primarily attributed short maturities instruments effective july 1 2008 company adopted asc 820 previously sfas 157 fair value measurements adopted statement assets liabilities shown table asc 820 clarifies definition fair value prescribes methods measuring fair value establishes fair value hierarchy based inputs used measure fair value expands disclosures use fair value measurements adoption asc 820 material impact fair value measurements asc 820 permits company defer recognition measurement nonfinancial assets nonfinancial liabilities january 1 2010 june 30 2017 company nonfinancial assets nonfinancial liabilities recognized disclosed fair value asc 820 requires financial assets liabilities reported fair value categorized one types investments based upon methodology mentioned level 1 level 2 level 3 determining fair value assets measured fair value recurring basis summarized company also convertible notes derivative liabilities disclosed report measured fair value regular basis paid converted common stock company availableforsale securities company uses various approaches measure fair value availableforsale securities applying threelevel valuation hierarchy disclosures specified asc 820 level 1 securities measured using quoted prices active markets identical assets liabilities company’s policy regarding transfers andor level 3 depends trading activity security volatility security observable units clearly represents fair value security level 3 security measured using fairly represented fair value transfer securities either level 1 level 2 depending type inputs revenue recognition company’s revenue recognition policies compliance asc 13 previously staff accounting bulletin sab 104 company recognizes consulting advisory fee revenues transaction completed service fees earned expenses recognized period corresponding liability incurred payments received relevant criteria revenue recognition recorded unearned revenue advertising company expenses advertising costs incurred advertising costs years ended june 30 2017 2016 31413 79072 respectively decrease advertising expenses current year primarily due reduction 35500 investor relations expenses fiscal year ended june 30 2017 compared previous fiscal year comprehensive income loss asc 2201045 previously sfas 130 reporting comprehensive income establishes standards reporting display comprehensive income components accumulated balances comprehensive income defined include changes equity except resulting investments owners distributions owners among disclosures sfas 130 requires items required recognized current accounting standards components comprehensive income reported financial statement displayed prominence financial statements june 30 2017 2016 respectively accumulated comprehensive incomes 153474 30263 presented accompanying consolidated balance sheets income taxes company accounts income taxes accordance asc 740 previously sfas 109 “accounting income taxes” deferred taxes provided liability method whereby deferred tax assets recognized deductible temporary differences deferred tax liabilities recognized taxable temporary differences temporary differences reported amounts assets liabilities tax bases deferred tax assets reduced valuation allowance opinion management likely portion deferred tax assets realized deferred tax assets liabilities adjusted effects changes tax laws rates date enactment reporting segments asc 280 previously statement financial accounting standards 131 disclosures segments enterprise related information supersedes statement financial accounting standards 14 financial reporting segments business enterprise establishes standards way public enterprises report information operating segments annual financial statements requires reporting selected information operating segments interim financial statements regarding products services geographic areas major customers asc 280 defines operating segments components enterprise separate financial information available evaluated regularly chief operating decision maker deciding allocate resources assessing performance company operated one segment generated revenues years ended june 30 2017 2016 risks uncertainties normal course business company subject certain risks uncertainties company provides service receives marketable securities upon execution transactions consequently value securities received customers affected economic fluctuations customer’s business growth actual realized value securities could significantly different recorded value recent accounting pronouncements update 201311income taxes topic 740 presentation unrecognized tax benefit net operating loss carryforward similar tax loss tax credit carryforward exists consensus fasb emerging issues task force download july effective fiscal years interim periods within years beginning december 15 2013 nonpublic entities amendments effective fiscal years interim periods within years beginning december 15 2014 early adoption permitted update 201309fair value measurement topic 820 deferral effective date certain disclosures nonpublic employee benefit plans update 201104 download july deferral amendment effective upon issuance financial statements issued update 201307presentation financial statements topic 205 liquidation basis accounting download april effective entities determine liquidation imminent annual reporting periods beginning december 15 2013 early adoption permitted update 201304liabilities topic 405 obligations resulting joint several liability arrangements total amount obligation fixed reporting date consensus fasb emerging issues task force download february effective fiscal years interim periods within years beginning december 15 2013 nonpublic entities amendments effective fiscal years ending december 15 2014 interim periods annual periods thereafter update 201302comprehensive income topic 220 reporting amounts reclassified accumulated comprehensive income download february public entities amendments effective prospectively reporting periods beginning december 15 2012 nonpublic entities amendments effective prospectively reporting periods beginning december 15 2013 early adoption permitted update 201301balance sheet topic 210 clarifying scope disclosures offsetting assets liabilities download january entity required apply amendments fiscal years beginning january 1 2013 interim periods within annual periods entity provide required disclosures retrospectively comparative periods presented effective date effective date update 201111 company either evaluated currently evaluating implications pronouncements possible impact may company’s financial statements cases management determined pronouncement either limited application company cases implementation would material impact financial statements taken whole note 3 loans receivable loans receivable consist following june 30 2017 2016 note 4 assets comprise following june 30 2017 2016 year ended june 30 2011 company signed consulting agreement assist agent155 media corp delaware corporation respect corporate restructuring business combination freshwater technologies inc nevada corporation part restructuring requirements company made payment manning elliot llp amount 24476 behalf freshwater technologies inc loan amounts agent155 media corp fiscal year ended june 30 2014 president agent155 media corp assumed balance 66955 agent155 media corp personal obligations company july 17 2015 company made advance payment 75000 asia green corporation nevada corporation total 500000 shares common stock asia green corporation june 30 2017 company wrote total amount owed christopher martinez deposit purchase totaling 141955 note 5 marketable equity securities available sale company’s marketable securities classified availableforsale carried fair value securities comprised shares common stock investee securities classified availableforsale may sold response changes interest rates liquidity needs purposes investment marketable securities represents less twenty percent 20 outstanding common stock equivalents investee security nationally quoted national association securities dealers otc bulletin board “otcbb” otc markets investment accounted accordance provisions sfas 115 marketable securities owned company classified available sale june 30 2017 consisted 33975106 shares myson group inc formerly vanguard mining corporation 292050000 shares sports pouch beverage company public companies traded public company traded otc markets trading symbols mysn spbv respectively fair value marketable securities recorded june 30 2017 502696 fiscal year ended june 30 2017 transfer securities level 3 level 2 note 6 property equipment fiscal year ended june 30 2017 company sold ten acres land parcel identification numbers 09705010180 190 suwannee county florida june 30 2017 company property equipment note 7 discontinued operations june 30 2012 company decided recognize businesses phi gold corp formerly phi mining corporation providential vietnam ltd phi energy corp philand ranch ltd united kingdom corporation together whollyowned subsidiaries philand corporation usa philand ranch ltd singapore philand vietnam ltd discontinued operations practical business accounting purposes june 30 2013 company recorded total 2234327 liabilities potential liability contingencies wrote nonperforming assets associated discontinued operations june 30 2017 company balance 1040037 longterm liabilities discontinued operations note 8 accounts payable accrued expenses accounts payable accrued expenses june 30 2017 2016 consist following note 9 due officers directors due officer represents loans advances made officers directors company subsidiaries unsecured due demand fiscal year ended june 30 2017 henry fahman converted 250000 2500000 shares restricted common stock company valued 010 per share addition company also repaid frank hawkins 7500 cash june 30 2017 2016 balances 592141 899674 respectively note 10 loans promissory notes short term notes payable course business company obtained shortterm loans individuals institutional investors time raised money issuing restricted common stock company auspices rule 144 june 30 2017 company reclassified 614390 shortterm notes payable accrued interest 2303163 longterm liabilities compared shortterm notes payable 673660 accrued interest 2879655 june 30 2016 respectively notes bear interest rates ranging 0 36 per annum convertible promissory notes february 29 2016 company issued convertible promissory note amount 56750 auctus fund llc delaware limited liability company convertible note due payable november 29 2016 interest 10 per annum note convertible election auctus fund llc time issuance date event default amount principal interest paid due bear interest rate 24 per annum note becomes immediately due payable event default occur company liable pay 150 outstanding principal interest note agreement contains covenants requiring auctus fund’s written consent certain activities existence committed company issuance date note follows dividend distributions cash shares stock repurchases borrowings sale assets certain advances loans excess 100000 certain guarantees respect preservation existence company noncircumvention outstanding note principal interest accrued thereon converted whole part time asher issuance date equivalent company’s common stock determined 55 average two lowest closing trading prices company’s common stock twenty 20 trading days prior date note company may prepay amounts outstanding auctus fund time 180th day following issue date note making payment note holder amount cash equal 125 150 multiplied sum w outstanding principal amount note plus x accrued unpaid interest unpaid principal amount note plus default interest depending time prepayment august 30 2016 auctus fund llc converted principal amount 56750 282976 accrued interest totaling 5957976 529598 shares freetrading stock company note paid full august 30 2016 fiscal year ended june 30 2017 company issued following convertible promissory notes various private investment funds july 20 2016 company issued convertible promissory note amount 50000 ema financial llc delaware limited liability company note coupon rate 10 matures one year convertible common stock company conversion price equals lower closing sale price common stock principal market trading immediately preceding closing date note ii 55 lowest sale price common stock principal market twenty 20 consecutive trading days immediately preceding conversion date note may prepaid 130 145 outstanding principal interest 180 days note paid full march 08 2017 august 16 2016 company issued convertible promissory note amount 56750 auctus fund llc delaware limited liability company note coupon rate 10 matures may 16 2017 convertible common stock company conversion price equals lower 50 multiplied average two lowest trading price previous twentyfive trading day period ending latest complete trading date prior date note ii 50 multiplied average two lowest trading prices common stock twentyfive trading day period ending latest complete trading day prior conversion date note may prepaid 135 150 outstanding principal interest 180 days note paid full april 6 2017 december 15 2016 company issued convertible promissory note amount 32000 power lending group note coupon rate 8 matures september 30 2017 convertible 180 days common stock company conversion price equals 58 multiplied average two lowest trading prices previous ten trading day period ending latest complete trading date prior conversion date note may prepaid 150 outstanding principal interest 180 days note paid conversions shares common stock company july 21 2017 february 2 2017 company issued convertible promissory note amount 3373468 jsj investments inc assignment portion principal amount accrued interest ema financial llc convertible promissory note dated july 20 2016 note converted 657169 shares common stock company jsj investments inc february 7 2017 february 2 2017 company issued convertible promissory note amount 42000 jsj investments inc interest rate 10 convertible common stock 45 discount maturity date note 1122017 august 1 2017 company paid 3146260 jsj investments one half principal note one half prepayment premium one half accrued unpaid interest september 30 2017 unpaid principal balance 21000 february 23 2017 company issued new convertible promissory note power lending group 28000 interest rate 8 convertible common stock company 45 discount maturity date note 11302017 august 14 2017 company paid total 4302488 power lending group amount included principal prepayment premium accrued interest note paid full august 14 2017 march 3 2017 company issued new convertible promissory note auctus fund llc 75000 interest rate 10 convertible common stock company 50 discount maturity date note 1232017 september 9 2017 company paid auctus fund llc 3930822 amount included one third principal one third prepayment premium one third accrued interest september 30 2017 unpaid principal note 50000 april 4 2017 company issued new convertible promissory note ema financial llc 50000 interest rate 10 convertible common stock company 50 discount maturity date note 442018 april 5 2017 company issued new convertible promissory note jsj investments inc 40000 interest rate 10 convertible common stock company 45 discount maturity date note 152018 april 12 2017 company issued new convertible promissory note power lending group 33500 interest rate 12 convertible common stock company 42 discount maturity date note 1252018 june 9 2017 company issued new convertible promissory note crown bridge partners llc 35000 interest rate 5 convertible common stock company 50 discount maturity date note june 9 2018 june 30 2017 principal balance outstanding convertible notes 364098 value derivative liability 452441 company relies professional thirdparty valuation record value derivative liability discount change fair value derivatives connection convertible notes warrants related convertible notes company intends prefers repay notes cash much practical note 11 longterm liabilities due preferred stockholders june 30 2017 company reclassified 215000 preferred stock subscribed longterm liabilities payable holders preferred stock providential securities inc previous subsidiary company discontinued year 2000 early 2000’s company made offer preferred stockholders receive shares common stock company exchange preferred shares discontinued subsidiary small number preferred shareholders responded accepted offer recent years company also attempted contact preferred shareholders time received response company continued accrue imputed interest expenses balance 215000 periodic basis june 30 2017 june 30 2016 438600 413255 included balance sheets accrued interest connection preferred stock liabilities respectively advances customers september 30 2012 company reclassified previously recorded unearned revenues advances customers company able complete consulting services related client due inability provide gaapcompliant audited financial statements order file registration statement securities exchange commission june 30 2017 company recorded 288219 advances customers longterm liability longterm liabilities june 30 2017 company reclassified 26888 accrued expense 172091 accrued legal fees 1089987 accrued salaries payroll taxes 173870 consulting fees 2303163 accrued interest notes payable 954337 discontinued operations 85700 contingent liabilities shortterm liabilities longterm liabilities items two years old note 12 litigation legal proceeding settled unpaid june 30 2016 quang van cao nhan thi nguyen cao vs providential securities inc et al case originally submitted orange county superior court ca june 25 1997 case 781121 subsequently moved nasd dispute resolution arbitration august 24 2000 company’s legal counsel negotiated claimant’s counsel unilaterally reached settlement approved company process renegotiating terms said settlement claimants filed request arbitration hearing national association securities dealers october 4 2000 case 9903160 thereafter claimants filed complaint orange county superior court ca october 31 2000 case 00cc13067 alleged breach contract damages sum 75000 plus prejudgment interest costs incurred connection complaint relief without admitting denying allegations company reached settlement agreement claimants whereby company would pay claimants total 62500 plus 4500 administrative costs date report company paid 2500 subject entry judgment 79000 may 2011 claimants filed application renewal judgment total 14049078 june 30 2017 company accrued 172091 potential liabilities connection case accompanying consolidated financial statements william davidson vs doan et al february 01 2010 company notified suit filed superior court state california county los angeles november 24 2009 william davidson individual martin doan henry fahman benjamin tran hrciti corporation providential capital inc collectively referred “defendants” case bc 426831 plaintiff demanded amount less 14000000 defendants promissory notes outstanding plaintiff company july 09 2012 william davidson phi capital holdings inc formerly providential capital inc subsidiary company reached settlement agreement respect whereby phi capital agreed pay william davidson total 200000 period nineteen months beginning september 1 2012 since november 30 2012 william davidson converted portions total amount common stock phi group inc lieu cash payment company accrued 90000 required liability associated balance notes accompanying consolidated financial statements june 30 2017 note 13 payroll liabilities payroll liabilities accrued recorded accrued expenses consolidated balance sheet quarter ended june 30 2014 company paid 4197422 internal revenue service 1928994 state california employment development department towards balance 118399 payroll tax penalties interest claimed agencies company plans resolve remaining balances internal revenue service state california employment department june 30 2018 note 14 basic diluted net loss per share net loss per share calculated accordance sfas 128 “earnings per share” provision sfas 128 basic net loss per share computed dividing net loss period weightedaverage number common shares outstanding period diluted eps based weightedaverage number shares common stock outstanding period common stock equivalents outstanding end period basic diluted weighted average numbers shares year ended june 30 2017 since inclusion common stock equivalents antidilutive note 15 stockholder’s equity june 30 2017 total number authorized capital stock company 1000000000 shares par value 0001 per share consisting 900000000 shares voting common stock par value 0001 per share 100000000 shares preferred stock par value 0001 per share rights terms associated preferred stock determined board directors company treasury stock balance treasury stock june 30 2017 321569 shares valued 40908 based cost basis common stock since july 1 2016 company issued following amounts common stock july 29 2016 company issued 22500 shares phi group inc’s restricted common stock valued 040 per share milost advisors inc buyside advisory services connection contemplated acquisitions target companies south africa north america shares later cancelled june 28 2017 august 29 2016 company issued 48930 shares phi group inc’s restricted common stock investor auspices rule 144 20000 cash price 04088 per share august 30 2016 auctus fund llc converted principal amount 56750 convertible promissory note dated february 29 2016 282976 accrued interest totaling 5957976 529598 shares freetrading stock company october 30 2016 company issued 200000 shares phi group inc’s restricted common stock two independent consultants consulting services price 025 per share december 5 2016 rev thuong le creditor company converted 150000 accrued interest 606060 shares common stock company december 22 2016 henry fahman chairman chief executive company converted 250000 balance loans officers 2500000 restricted shares common stock company january 30 2017 ema financial llc converted 701050 principal amount convertible promissory note dated july 20 2016 180000 shares common stock company february 7 2017 jsj investments inc converted 3373468 replacement convertible note dated february 2 2017 replaced amount indebtedness ema financial llc 657169 shares common stock company february 9 2017 ema financial llc converted 7200 principal amount convertible promissory note dated july 20 2016 200000 shares common stock company march 08 2017 ema financial llc converted 786778 principal accrued interest convertible promissory note dated july 20 2016 244340 shares common stock company april 6 2017 auctus fund llc converted 2065171 principal amount convertible promissory note dated august 16 2016 together 349829 accrued unpaid interest thereto totaling 24150 750000 shares common stock company june 23 2017 company issued 495441 shares freetrading common stock phi group inc power lending group ltd holder convertible promissory note dated 12152016 company conversion 750000 principal amount note conversion price 0015138 per share principal amount note conversion 2450000 june 28 2017 company cancelled 225000 common stock phi group inc previously issued milost advisors inc consulting services valued 9000000 july 05 2017 company issued 740741 shares freetrading common stock phi group inc power lending group ltd holder convertible promissory note dated 12152016 company conversion 1000000 principal amount note conversion price 00135 per share principal amount note conversion 1450000 july 11 2017 company issued 800000 shares freetrading common stock phi group inc auctus fund llc holder convertible promissory note dated 8162016 company conversion 515200 consisting 348517 principal amount note 166683 accrued unpaid interest thereto conversion price 000644 per share principal amount note conversion 3261312 subsequently july 24 2017 company paid total 4953072 auctus fund llc consisting 3261312 principal amount balance prepayment premium accrued unpaid interest connection convertible promissory note dated 81616 note paid full principal balance due remaining accrued unpaid interest remaining payment 000 july 17 2017 company issued 880000 shares freetrading common stock phi group inc power lending group ltd holder convertible promissory note dated 12152016 company conversion 792000 principal amount note conversion price 0009 per share july 21 2017 company issued 1019872 shares freetrading common stock phi group inc power lending group ltd holder convertible promissory note dated 12152016 company conversion 795500 consisting 6580 principal amount note 137500 accrued unpaid interest thereto conversion price 00078 per share principal balance due remaining accrued unpaid interest remaining conversion 000 july 25 2017 henry fahman chairman chief executive officer company converted 300000 indebtedness owed company 20000000 shares restricted common stock phi group inc conversion price 0015 per share conversion restricted common stock company effectuated pursuant resolutions company’s board directors dated march 12 2012 june 06 2012 november 2 2012 remain full force effect allowing creditors company convert outstanding indebtedness accrued unpaid interest thereof shares common stock phi group inc relying exemption registration requirements united states securities act 1933 amended “act” july 25 2017 company issued total 1533333 shares restricted common stock phi group inc pursuant rule 144 two nonus shareholders connection private stock purchase agreements dated july 19 2017 july 20 2017 respectively shareholders company total 2300000 purchase price 0015 per share september 30 2017 41082982 shares company’s common stock issued outstanding excluding 5673327 shares common stock set aside special dividend distribution preferred stock preferred stock issued outstanding june 30 2017 class preferred stock april 2 2015 company designated first fifty million 50000000 shares company’s previously authorized 100000000 shares preferred stock par value 0001 per share class cumulative convertible redeemable class preferred stock “class preferred stock “ following rights terms 1 dividends holder class preferred stock entitled receive twelve percent 12 noncompounding cumulative dividends per annum payable semiannually 2 conversion share class preferred stock shall convertible company’s common stock time one year date issuance variable conversion price defined herein common stock “variable conversion price” shall mean 75 multiplied market price defined herein representing discount rate 25 “market price” means average trading price company’s common stock ten 10 tradingday period ending one trading day prior date conversion notice sent holder class preferred stock company via facsimile email “conversion date” “trading price” means security date closing price otc markets otcqb nasdaq stock markets nyse applicable trading market reported reliable reporting service “reporting service” mutually acceptable company holder class preferred stock 3 redemption rights company period two years date issuance may time redeem class preferred stock whole part option company’s board directors price equal one hundred twenty percent 120 original purchase price class preferred stock unit consisting shares class preferred stock warrants attached thereto plus case accumulated unpaid dividends date fixed redemption note 16 stockbased compensation plans february march 18 2015 company adopted employee benefit plan set aside 1000000 shares common stock eligible employees independent contractors company subsidiaries june 30 2017 company issued stock lieu cash plan september 23 2016 company issued incentive stock options nonqualified stock options certain key employees henry fahman ceocfo directors tam bui henry fahman frank hawkins constitute board directors deferred compensation options allow holders acquire company’s common stock fair exercise price company’s common stock grant date option 024 per share based 10days’ volumeweighted average price prior grant date number options equal total 6520000 options terminate seven years date grant become vested exercisable one year grant date following assumptions used monte carlo analysis doty scott enterprises inc independent valuation firm determine fair value stock options annual attrition rates used valuation since ongoing employment condition vesting options fair value company’s stock options issuance valuation date follows note 17 gain loss settlement debts fiscal year ended june 30 2017 net loss amount 131818 conversions debts common stock company creditors note 18 income expense net income expense fiscal year ended june 30 2017 consists following note 19 related party transactions company accrued 210000 salaries president secretary company year ended june 30 2017 june 5 2017 company received fee amount 20000 american laser healthcare corp “alhc” delaware corporation connection consulting service provided phi capital holdings inc assist alhc go public us chairman ceo company also serves interim chief executive officer alhc note 20 income taxes provision made income tax since company significant net operating loss carry forward june 30 2017 company incurred net operating losses tax purposes approximately 39300254 net operating loss carry forward may used reduce taxable income year 2032 net operating loss carry forwards state california generally available reduce taxable income year 2022 availability company’s net operating loss carryforward subject limitation 50 positive change ownership company’s stock “under section 6501a internal revenue code tax code section 3016501a1a income tax regulations tax regulations irs required assess tax within 3 years tax return filed irs” note 21 contracts commitments business financial consulting agreement thinh hung investment co fiscal year ended june 30 2010 company signed agreement thinh hung investment co ltd vietnambased company assist thinh hung identifying locating possibly acquiring various business opportunities thinh co ltd subsidiary thinh hung including limited reverse merger stock swap business combination thinh publiclytraded company us exchange services rendered company would receive compensation cash thinh hung common stock combined company september 30 2011 company consummated stock purchase investment agreement thinh anh co ltd vietnam foods corporation nevada corporation however combined company filed registration statement securities exchange commission become reporting company recognized 26656 revenues transaction fiscal year ended june 30 2016 company repaid 5000 thinh hung investment co balance 288219 reclassified customer advances longterm liability portion balance sheet consulting agreement sports pouch beverage company june 3 2015 phi capital holdings inc wholly owned subsidiary company signed consulting engagement agreement sports pouch beverage company “spbv” nevada corporation provide consulting services assist spbv respect business development mergers acquisitions corporate governance corporate finance phi capital holdings inc entitled receive forty percent common stock spbv compensation services rendered duration agreement one year december 31 2016 phi capital holdings inc recorded total 292050000 shares spbv stock earned revenues transaction returned 97350000 shares client agreement defrayal expenses stock compensation asia green corporation july 17 2015 company signed agreement provide 75000 asia green corporation agmc” nevada corporation agmc pay certain required expenses resume status fully reporting company securities exchange commission exchange fund agmc agrees allocate 500000 shares common stock upon consummation business combination vietnamese company engaged agriculture reforestation amount written june 30 2017 business cooperation agreement pt jaya sakti globalindo march 17 2016 company signed business cooperation agreement pt jaya sakti globalindo jsg indonesian company utilize hard assets held jsg affiliates collaterals project financing parties intend enter definitive agreements collateral provision connection specific projects terms conditions provisions date report company undertaken projects would qualify utilization collateral assets jsg affiliates engagement letter milost advisors inc july 11 2016 company signed engagement letter milost advisors inc assist company analysis consideration appropriate execution various financial strategic alternatives available including securing additional equity andor debt capital assisting company analysis consideration financial aspects certain potential strategic transactions mergers acquisitions spinoffs joint ventures minority investments negotiated purchases similar transactions consideration services rendered milost company agreed pay milost retainer fee equal 100000 payable form 10000 cash 90000 stock company valued 040 per share company also agreed pay milost success fee 8 equity financing 5 mezzanine senior debt financings june 30 2017 milost returned 225000 shares common stock phi group inc valued 90000 company engagement letter null void memorandum understanding milost global inc july 18 2016 company signed memorandum understanding milost global inc us private equity firm cooperate promoting competitiveness well joint activities acquire cashflow positive companies north america south africa australia singapore new zealand seek growth alternatives order fasttrack shareholder value dividend distribution parties agreed use milost advisors inc first right refusal advisor conduct strategic planning exercise form new special purpose company spc partnership activities would carried spc would held managed controlled parties pari passu intended partnership would assist parties implementation combined growth strategies would help identify areas party could provide capacity building support subsequently company terminated engagement letter milost advisors inc memorandum understanding milost global inc letter intent acquire south african mining services company july 19 2016 company presented preconditional nonbinding undertaking make offer acquire entire issued capital undisclosed south african mining services company listed johannesburg stock exchange “sa target” july 25 2016 approval given sa target’s board directors management team enter discussions phi group good faith proceed due diligence process outlined undertaking following completion due diligence process conducted milost advisors inc company september 3 2016 company presented letter intent “loi” sa target acquire issued capital exchange common stock phi group exchange rate would determined basis 10 days’ volumeweighted average price vwap companies day loi according loi company also commits provision usd 20 million shareholder loan facility sa target approximately usd 12 million used repayment sa target subsidiary’s term loan remaining usd 8 million available draw facility financing working capital requirements sa target usd 12 million facility noninterest bearing company effectively turned around whilst minority shareholders buildmax thereafter interest 5 per annum charged shareholder loan repaid period agreed depending free cash flow generated sa target september 6 2016 approval granted sa target’s board directors independent board management team enter discussions phi group good faith proceed transaction september 14 2016 company received confirmation sa target’s management 77 shareholders sa target approved acquisition offer phi group october 10 2016 milost global inc submitted revised offer sa target declined sa target’s board directors october 11 2016 subsequently company decided pursue transaction secured line credit facility tca global credit master fund lp august 30 2016 company signed term sheet tca global credit master fund lp “investor” maximum 15000000 senior secured line credit 4000000 made available company first drawdown “initial line credit” acquisition financing closing date start date line credit facility company discretion investor may request increase line credit agreed upon time periods agreed upon amounts sum initial line credit subsequent line increases “then current line size” shall exceed maximum line credit subsequent line increase require company execute deliver new revised revolving note investor responsible fees expenses associated line increase line credit may drawn investor’s discretion repaid company throughout term facility amount requested drawn “advance” shall exceed 80 repayments investor’s designated account less interest fees reserve amount current line size satisfied frequency advances mutually agreed upon investor company date report company drawn amount line credit milost equity subscription agreement september 8 2016 company entered letter intent milost global inc us private equity firm respect principal terms conditions milost global inc would invest 100 million phi group inc investment amount 50 million would equity 50 million loan september 25 2016 company signed agreement milost global inc 50 million structured milost equity subscription agreement ‘mesa” whereby milost global willing initially invest 15 million working capital needs phi group amount 15 million would drawn tranches minimum 500000 fully utilized mesa would utilized share exchange milost global inc phi group balance 50 million facility would available equity leakage future acquisitions phi group according structure mesa milost global inc would entitled purchase shares common stock phi group price per share basis 2 discount 20 company milost agreed long company’s stock price reached 2 per share milost global inc would receive company’s convertible notes instead company’s shares drawdown milost global inc would right convert convertible notes common shares company price phi group’s stock reaches target price 2 company agreed pay milost global inc commitment fee equal 4 total commitment payable within 3 business days price company’s common stock reaches target price 6 september 27 2016 company submitted drawdown notice milost global inc total 2750000 mesa’s total 50million commitment form convertible note bearing annual interest 5 convertible common stock 20 discount phi group’s common stock reaches 2 per share proceeds drawdown would allocated follows 2150000 towards cash payment purchase agricultural company “agri target” southeastern united states 500000 due diligence document fees acquisitions sa target agri target educational company canada 100000 general working capital september 28 2016 milost global inc confirmed 500000 remitted milost advisors milost global inc behalf phi group inc part first drawdown notice presented milost global inc company date report company received direct disbursements milost global inc drawdown terminated milost equity subscription agreement entirety consulting service agreement tans company ltd september 9 2016 phi capital holdings inc signed consulting service agreement tans company ltd vietnambased company provide advisory consulting services nonexclusive basis assist tans co becoming publicly traded company us stock market company entitled cash compensations tans co portion equity new public company date report transaction subject review parties memorandum understanding acquire abound farms inc september 30 2016 company signed memorandum understanding abound farms inc “afi target” us company acquire 100 afi target afi target engaged hydroponics possesses proprietary water treatment systems nutrients known substantially enhance farming yields mou sets forth guidelines negotiations afi target company signing definitive agreement contains representations warranties covenants indemnities customary transaction type company intends incorporate afi target’s water treatment systems nutrients agri target’s business closing transactions memorandum agreement hoang minh chau hung yen llc january 26 2017 company entered memorandum agreement acquire 51 hoang minh chau hung yen llc “hmc” vietnamese company specializing growing processing turmeric food cosmetic medicinal usages company intends apply hmc’s expertise experience turmeric cultivation processing organic farming program us subsidiary abundant farms inc closing transaction subject due diligence review financial audits hmc business cooperation agreement nathan trading ltd january 28 2017 company entered business cooperation agreement nathan trading limited co “ntc” thai company engaged promotion cultivation processing sacha inchi seeds food cosmetics healthcare company intends initially purchase ntc’s sacha inchi products ntc distribution us international markets subsequently cooperate ntc promote planting sacha inchi plants secure raw material sources increase production capacity future purchase agreement acquire farm holmes county florida march 2017 company signed commercial contract acquire 408acre farm together buildings fixtures farming systems bonifay holmes county florida total purchase price 1500000 company made initial deposit 37500 towards total purchase price negotiated farm owners extend closing date purchase agreement end december 2017 company intends use property abundant farms inc wholly owned subsidiary company develop proprietary organic farming program conjunction eb5 investment capital qualified international investors investment agreement azure capital inc march 6 2017 phi group inc nevada corporation “company” azure capital massachusetts corporation “investor” entered investment agreement “investment agreement” registration rights agreement “registration rights agreement” dated march 6 2017 company investor investment agreement registration rights agreement amended august 3 2017 pursuant investment agreement investor committed purchase subject certain restrictions conditions 10000000 worth company’s common stock period 36 months effectiveness registration statement registering resale shares purchased investor pursuant investment agreement company agrees reserve 65445000 shares common stock issuance investor pursuant investment agreement event company cannot register sufficient number shares common stock issuance pursuant investment agreement company use best efforts authorize reserve issuance number shares required company perform obligations connection investment agreement soon reasonable practical company may discretion draw facility time company determines appropriate accordance terms conditions investment agreement maximum number shares company entitled put investor one draw notice shall exceed shares purchase price 250000 200 average daily volume us market company’s common stock three 3 trading days prior applicable put notice date multiplied average three 3 daily closing prices immediately preceding put date calculated accordance investment agreement company may deliver notice subsequent put time pricing period prior put completed purchase price shall set ninetyfour percent 94 lowest daily volume weighted average price vwap company’s common stock five 5 consecutive trading days immediately following put notice date put notice submitted investor company shall specify suspension price put event price company’s common stock falls suspension price put shall temporarily suspended put shall resume time price company’s common stock suspension price provided dates pricing period particular put still valid event pricing period complete shares suspension price due investor shall sold investor company suspension price terms investment agreement suspension price put may changed company submitted investor put restrictions applied days draw notice date closing date respect particular put time company shall entitled deliver another draw notice addition investor obligated purchase shares investor’s total number shares beneficially held time would exceed 499 number shares company’s common stock determined accordance rule 13d1j securities exchange act 1934 amended addition company permitted draw facility unless effective registration statement cover resale shares investment agreement also contains customary representations warranties parties assertions embodied representations warranties made purposes investment agreement subject qualifications limitations agreed parties connection negotiating terms investment agreement investment agreement provides company investor entitled customary indemnification among things losses liabilities may suffer result breach party provisions investment agreement registration rights agreement defined investor read investment agreement together information concerning company publicly files reports statements securities exchange commission “sec” pursuant terms registration rights agreement company obligated file one registrations statements sec within twentyone 21 days date registration rights agreement register resale investor shares common stock issued issuable investment agreement addition company obligated use commercially reasonable efforts registration statement declared effective sec within 90 days registration statement filed company filed s1 registration statement securities exchange commission april 3 2017 withdrawal registration statement august 7 2017 subsequently new s1 registration statement filed august 7 2017 s1a filed september 15 2017 agreement primeforth renewable energy ltd june 24 2015 phi capital holdings inc wholly owned subsidiary company signed consulting engagement agreement primeforth renewable energy ltd “primeforth” singaporean company provide consulting services respect corporate development corporate finance debt financing primeforth renewable energy phi capital holdings entitled onetime nonrefundable professional fee 20000 4 cash success fee financing arranged primeforth company also entitled additional compensations advisory business development services client term agreement two years company recognized 40000 revenues fiscal year ended june 30 2016 40000 fiscal year ended june 30 2017 respectively agreement defrayal expenses stock compensation asia green corporation july 17 2015 company signed agreement provide 75000 asia green corporation agmc” nevada corporation agmc pay certain required expenses resume status fully reporting company securities exchange commission exchange fund agmc agrees allocate 500000 shares common stock upon consummation business combination vietnamese company engaged agriculture reforestation amount written company’s balance sheet june 30 2017 consulting service agreement september 23 2016 company signed agreement engage consultant due diligence business development corporate services period year company agreed pay consultant onetime fee one hundred thousand restricted shares phi group’s stock compensations term agreement option grants september 23 2016 board directors company approved option grants current members board directors president chief executive officer phi group inc acquire 6520000 shares company’s common stock exercise price 024 per share based 10days’ volumeweighted average price phi group inc’s common stock prior grant date options vested one year grant date private stock purchase sale agreement maxagro group may 26 2017 company entered private stock purchase sale agreement “agreement” purchase 51 equity ownership maxagro farm srl “mxg” romanian company exchange cash stock company’s subsidiary fair value transaction determined parties completion business valuation mxg one reputable qualified independent business valuation firms financial audits mxg pcaobregistered auditing firm closing transaction originally scheduled occur august 08 2017 extended end december 2017 unless extended mutual consent parties business cooperation agreement hung vuong export import construction joint stock company may 6 2017 company signed business cooperation agreement hung vuong export import construction joint stock company vietnamese company form new corporation utilize philand corporation wyoming corporation previously formed company holding company purpose acquiring eightyfive percent ownership vidifi jsc vietnamese company owns operates 105km hanoihaiphong expressway together industrial zone urban centers along expressway transaction subject approval appropriate ministries prime minister central government vietnam well available financing options agreemen purchase 51 equity ownership constructii sa june 29 2017 “company entered “contract transfer shares” purchase 51 equity ownership constructii sa “csa” romanian company engaged construction manufacturing since 1950 ioan tusinean majority shareholder csa exchange fifteen million us dollars cash first closing transaction scheduled occur within maximum sixty days date signing contract final closing occur thirty days first closing subject mutual written consent company selling shareholder csa final closing may occur times note 22 going concern uncertainty shown accompanying consolidated financial statements company accumulated deficit 39299754 total liabilities stockholders’ deficit 7513481 june 30 2017 factors well uncertain conditions company faces daytoday operations respect cash flows create uncertainty company’s ability continue going concern financial statements include adjustments might necessary company unable continue going concern management taken action strengthen company’s working capital position generate sufficient cash meet operating needs june 30 2018 beyond next twelve months company intends continue pursuing merger acquisition program acquiring controlling interests target companies number industries including limited conventional energy renewables natural resources agribusiness technology transportation education distribution mining oil gas financial services healthcare biotechnology pharmaceuticals believe closing one transactions contemplated note 23 subsequent event able build critical mass uplist nasdaq stock market nyse near future addition continue provide advisory consulting services international clients wholly owned subsidiary phi capital holdings inc company anticipates generating substantial amounts revenues merger acquisition program advisory services mentioned herein however assurances could made management would successful achieving plan president chairman company committed funding company’s operations various sources next 12 months note 23 subsequent event financial statements approved management available issuance october 12 2017 subsequent events evaluated date payments convertible promissory notes july 24 2017 company paid 4953072 auctus fund llc balance principal prepayment premium accrued unpaid interest convertible promissory note dated august 16 2016 auctus fund llc company note paid full july 242017 august 1 2017 company paid 3146260 jsj investments one half principal note one half prepayment premium one half accrued unpaid interest convertible promissory note dated february 2 2017 september 30 2017 unpaid principal balance 21000 august 14 2017 company paid total 4302488 power lending group amount included total principal prepayment premium accrued interest convertible promissory note dated february 23 2017 note paid full august 14 2017 september 9 2017 company paid auctus fund llc 3930822 amount included one third principal one third prepayment premium one third accrued interest convertible promissory note dated march 3 2017 september 30 2017 unpaid principal note 50000 issuances new convertible promissory notes july 20 2017 company issued new convertible promissory note power lending group 28000 interest rate 8 convertible common stock company 42 discount maturity date note 4302018 august 3 2017 company issued new convertible promissory note jsj investments inc 78750 interest rate 10 convertible common stock company 45 discount maturity date note 532018 august 15 2017 company issued new convertible promissory note power lending group 33000 interest rate 10 convertible common stock company 42 discount maturity date note 5152018 august 24 2017 company issued new convertible promissory note lg capital 78750 interest rate 8 convertible common stock company 50 discount maturity date note 5262018 company intends prepay notes cash settlement agreement thinh hung investment co august 3 2017 company signed settlement agreement agreed pay thinh hung investment co total amount 381000 includes outstanding balance 288219 reclassified customer advances longterm liability portion attached balance sheet accrued interest agreed two parties according settlement agreement compapny transfer cause transferred least 480000 shares common stock phi group inc authorized represenatative thinh hung event thinh hung unable realize least 381000 sale phi stock phi group either transfer additional common stock phi group inc marketable securities authorized reprenesattive designated thinh hung pay cash directly thinh hung total amount 381000 reached phi group inc agreed use best efforst pay outstanding balance october 31 2017 receipt least 480000 shares phi group stock authorized representative thinh hung thinh hung shall deliver transfer vietnam foods corporation stock phi group inc authorized representative business cooperation agreement tnb vietnam jsc august 7 2017 company signed business cooperation agreement tnb vietnam jsc vietnamese company located mekong delta specializes cultivating processing “forest” bitter melon momordica charantia according agreement tnb phi group plan facilitate mutual growth expansion including limited 1 purchase finished forest bitter melon products tnb distribution sale us europe china select international markets phi group’s private labels 2 purchase semiprocessed ingredients tnb order manufacture end products export markets 3 strategic alliance acquisition equity interest tnb andor exchange ownership tnb phi via stock swap 4 codeveloping cultivating forest bitter melon well manufacturing marketing products us international markets potential longterm growth formation phi ez water tech inc subsidiary august 7 2017 company incorporated phi ez water tech inc wyoming corporation subsidiary manage commercialize water treatment systems developed dr martin nguyen vietnameseamerican scientist systems among series products developed dr nguyen using quantum technology combination disciplines including applied physics applied water science biological system engineering agricultural economics incorporating complex electromagnetic force advanced oxidation electrocoagulation ultrasound reduce water consumption 30 fertilizer usage 3050 boosting crop yields 3050 water produced systems also good human health able stabilize water environments increase yields aquatic wet paddy farming memorandum understanding aquarius power inc august 9 2017 company signed memorandum understanding “mou” aquarius power inc “aqp” texas company provide renewable energy technology vietnam phi also made investment become strategic shareholder aqp phi aqp form joint venture company exclusive right sublicense sell build andor operate aqp energy systems vietnam exclusive basis phi responsible obtaining necessary approvals build operate aquarius energy system securing binding acceptable power purchase agreement ppa governmental authority providing land aquarius energy system providing construction civil engineering knowhow build energy pools providing management engineering operational manpower build operate aquarius engineering system providing interconnection aquarius energy system national grid aqp’s responsibilities include support phi obtaining power purchase agreement conduct site survey provide blueprints tailor made energy system provide technical support construction operation energy system includes training construction installation operations build ship aquarius energy systems install commission aquarius energy system required aquarius wave energy system landbased wave energy system uses combination gravity “buoyancy” found within interaction air water produce power used generate electricity produce potable water aquarius baseload zero carbon footprint uses consumables installed virtually anywhere planet cost effective fossil fuel alternatives system built turnkey within 6 months obtaining permits operating life 60 years clean scalable reliable extremely flexible operating cost comparably low hydroelectric systems october 6 2017 company signed new memorandum understanding “mou” aquarius power inc expand scope cooperation provide renewable energy technology eastern europe european region eastern europe company process planning build pilot unit romania using aqp technology phi also intends make additional investments aqp master business cooperation agreement tho xuan duong joint stock company august 14 2017 company signed master business cooperation agreement tho xuan duong joint stock company vietnamese traditional medicine company 400 years history cooperate following areas 1 phi assist txd promote advertise txd’s brand traditional medicinal products treatments global basis 2 phi assist txd set manufacturing facilities andor establish strategic alliances pharmaceutical production distribution companies europe united states middle east central south america africa selective geographical areas 3 phi assist txd access funding sources implement txd’s business plan 4 phi discuss negotiate txd consider acquisition equity interest txd andor exchange ownership tnb phi way stock swap form strategic alliance two companies 5 phi txd discuss potential taking txd public us andor european stock markets provide longterm financing capabilities txd’s development growth 6 phi txd cooperate build develop raw material areas preliminary fullscale processing facilities herbal medicines herbal medicine tourism area sapa lao cai province northern vietnam 7 phi assist txd obtain special medical devices using low level laser light therapy technologies developed american laser healthcare corp us company cleared us fda pain treatment needles acupuncture diabetes type 2 18 devices well access medical devices txd’s usage needed 8 phi txd may jointly develop manufacture market products andor engage business activities may mutual interest parties letter intent acquire 80 medical corp srl romanian company august 23 2017 company signed letter intent acquire eighty percent 80 equity interest medical corp srl “mdc” price one million euros however final purchase price payment schedule determined asset valuation mdc companies intend execute definite agreement consummate transaction soon practical agreement acquire 51 ownership 400acre mining claims grant county oregon september 2 2017 american pacific resources inc wyoming corporation “apr” wholly owned subsidiary company entered agreement purchase sale rush gold royalty inc wyoming corporation acquire 51 ownership twentyone mining claims area approximately 400 acres granite mining district grant county oregon usa exchange total purchase price twentyfive million us dollars us 25000000 paid combination 20 million phi group inc’s class series ii convertible cumulative redeemable preferred stock “preferred stock” 5 million cash demand promissory note upon closing contemplated transaction phi group’s class series ii preferred stock priced 5 per share “original price per share” carrying cumulative dividend rate 8 redeemable 120 premium original price per share convertible common stock phi group 25 discount six months issuance common stock apr 50 discount relevant market price apr become fullyreporting company transaction closed effective october 3 2017 phi group inc’s domestication state wyoming september 20 2017 company applied certificate domestication filed articles domestication office secretary state wyoming redomicile company’s jurisdiction state wyoming september 20 2017 company filed articles amendment wyoming secretary state amend authorized capital company follows “the total number shares authorized capital stock corporation divided one billion shares consisting nine hundred million shares voting common stock par value 0001 per share fifty million shares nonvoting class series preferred stock par value 500 per share twentyfive million shares nonvoting class series ii preferred stock par value 500 per share twenty million shares nonvoting class series iii preferred stock par value 500 per share five million shares voting class series iv preferred stock par value 500 per share relative rights preferences limitations restrictions associated aforementioned shares class preferred stock determined board directors corporation” phi capital holdings inc’s domestication state wyoming september 20 2017 phi capital holdings inc wholly owned subsidiary company applied certificate domestication filed articles domestication office secretary state wyoming redomicile subsidiary’s jurisdiction state wyoming technical assistance agreement auburn university september 25 2017 company signed technical assistance agreement auburn university conduct research program order determine market segments related supply demand medicinal aromatic plants world focus specifically major production consumption markets first four topics research program focus production medicinal applications market analysis turmeric saffron bitter melon major potential aromatic plants last topic covers trends solutions switching conventional farming organic farming crops meet future food medicinal consumption research program begins october 1 2017 ends september 30 2018 item 9 item 8 financial statements report independent registered public accounting firm board directors stockholders phi group inc formerly providential holdings inc audited accompanying consolidated balance sheets phi group inc nevada corporation subsidiaries june 30 2009 2008 related consolidated statements operations stockholders equity cash flows years ended june 30 2009 2008 consolidated financial statements responsibility companys management responsibility express opinion consolidated financial statements based audits conducted audit statements accordance standards public company accounting oversight board united states standards require plan perform audit obtain reasonable assurance whether financial statements free material misstatement audit includes examining test basis evidence supporting amounts disclosures financial statements audit also includes assessing accounting principles used significant estimates made management well evaluating overall financial statement presentation believe audits provide reasonable basis opinion consolidated financial statements referred present fairly material respects consolidated financial position phi group inc subsidiaries june 30 2009 results consolidated operations cash flows years ended june 30 2009 2008 conformity accounting principles generally accepted united states america companys financial statements prepared using generally accepted accounting principles applicable going concern contemplates realization assets liquidation liabilities normal course business company accumulated deficit 23312661 negative cash flow operations amounting 550329 year ended june 30 2009 factors discussed note 20 consolidated financial statements raise substantial doubt companys ability continue going concern managements plans regard matters also described note 20 consolidated financial statements include adjustments might result outcome uncertainty kabani company inc certified public accountants los angeles california october 13 2009 phi group inc subsidiaries formerly providential holdings inc notes consolidated financial statements note 1 nature business phi group inc phi engaged number business activities important merger acquisition advisory services company acquires consolidates special opportunities selective industries create additional value acts incubator emerging companies technologies provides financial consultancy advisory services us foreign companies wholly owned division company provimex formed april 10 2001 name providential imex focus trade commerce vietnam division changed name provimex july 5 2001 subsidiary later incorporated nevada corporation september 23 2004 company declared 15 stock dividend provimex inc shareholders record september 15 2004 may 2003 company formed subsidiary name providential capital provide financial products services microsmall cap arenas manage companys proprietary merger acquisition activities providential capital focus attention underserved segment smaller companies united states abroad providential capital began providing merger acquisition advisory services clients since fiscal year ended june 30 2003 july 7 2003 whollyowned dba providential holdings inc touchlink communications formed provide pointofsale pos terminals prepaid calling cards retailers convenient stores nonprofit organizations across us pos system enables merchants participating partners offer prepaid products without purchasing storing inventory advance company later incorporated nevada corporation february 2004 name touchlink communications inc provide long distance services residential business customers united states company declared 15 stock dividend touchlink communications inc shareholders record september 15 2004 november 1 2003 company formed phi video corp later renamed phi digital corp phi digital nevada corporation provide sale consumer electronics including flatscreen television sets monitors phi digital renamed tulon industries inc change scope business subsidiary generate revenue fiscal years ended june 2005 2006 december 31 2003 company formed providential oil gas inc nevada corporation whollyowned subsidiary pursue independent oil gas business november 24 2005 providential oil gas inc signed agreement terrafirma gas oil inc nevada corporation headquarters midland texas codevelop twentyfour gas wells hudspeth ranch crockett county west texas 20000 investment made company project fiscal year ended june 30 2006 company wrote investment fiscal year ended june 30 2007 june 14 2006 providential oil gas inc changed name providential energy corporation expand scope business potentially include alternative energy fuel cells biodiesel entity operations year ended june 30 2009 2008 july 2007 philand corporation nevada corporation whollyowned subsidiary company formed manage real estate development project south hoi quang nam province vietnam july 2007 providential holdings entered principle agreement people’s committee quang nam province allows company lease approximately 8000 acres land south hoi quang nam province vietnam develop integrated tourism zone 70year lease term philand corporation currently involved planning developing project year ended june 30 2009 3500000 shares philand corporation issued employees consultants company 244286 shares owned company sold individuals 140000 29000 shares exchanged payment note amounting 29000 900000 shares owned company exchanged 23285714 shares jeantex group inc addition year ended june 30 2009 408000 shares philand corporation sold 49000 total 5081286 shares held minority shareholders makes approximately 21 outstanding shares june 5 2009 philand ranch limited company registered laws england wales acquired issued outstanding common stock philand corporation exchange amount ordinary shares philand ranch limited result stock exchange philand corporation philand ranch limited company currently owns 18734753 shares ordinary stock philand ranch limited listed open market segment frankfurt stock exchange symbol 1p8f wkn a0rpea march 2007 company received 900000 shares valued 675000 biowarm subsequently acquired 100 vietnambased dai dung metallic manufacture construction trade company ddmmct changed name ddc industries inc company received shares advisory services completed earlier month june 2007 company received 3763753 shares ddc industries services performed merger biowarm corp ddmmct closed march 30 2007 received remaining 3763753 shares year ended june 30 2008 per agreement total equivalent 20 issued outstanding shares ddc industries inc merger agreement ddmmct rescinded november 18 2008 entirety shareholders ddmmct agreed return 28610025 shares 30110025 issued shares december 1 2008 ddc industries inc changed name phi mining group inc common stock phi mining group inc currently trading pink sheets symbol “phig” phi mining group generate revenues year ended june 30 2009 indochina mining corporation nevada corporation incorporated march 20 2008 exploitation processing diatomite mines april 14 2008 indochina mining corporation imc entered cooperation agreement phu yen minerals joint stock company pymico agreement pymico imc cooperate contribute capital establishment joint venture specializing exploitation processing diatomite phu yen providence imc participate pymico purchasing maximum 30 shares pymico latter issues additional shares 2008 indochina mining also entered agreements december 1 2008 indochina mining corporation entered stock purchase agreement phi mining group formerly ddc industries inc exchange capital stock number newly issued shares phi mining group result company owns approximately 83 phi mining group may 20 2008 providential vietnam vietnamese corporation whollyowned subsidiary company formed provide advisory services management consulting corporate restructuring asset management fund management investment banking services independent oil gas alternative energy mining commercial residential real estate hotels integrated hospitality investments selective opportunities potential high growth note 2 summary significant accounting policies principles consolidation consolidated financial statements include accounts phi group inc subsidiaries providential securities inc providential capital phi digital inc “phi digital” provimex providential energy corporation touchlink communications phi mining group providential vietnam philand ranch 100 owned subsidiary philand corporation ltd collectively referred company significant intercompany transactions eliminated consolidation providential securities inc phi digital provimex providential energy corporation touchlink communications inactive use estimates preparation consolidated financial statements conformity accounting principles generally accepted united states america requires management make estimates assumptions affect reported amounts assets liabilities disclosure contingent assets liabilities date financial statements reported amounts revenues expenses reporting period actual results could differ estimates cash equivalents company considers liquid investments maturity three months less date purchase readily convertible cash equivalents marketable securities companys securities classified availableforsale carried fair value securities classified availableforsale may sold response changes interest rates liquidity needs purposes investment marketable securities represents less twenty percent 20 outstanding common stock equivalents investee security nationally quoted national association securities dealers otc bulletin board otcbb pink sheets investment accounted accordance provisions sfas 115 unrealized holding gains losses availableforsale securities excluded earnings reported separate component stockholders equity realized gains losses securities classified availableforsale reported earnings based upon adjusted cost specific security sold june 30 2009 2008 marketable securities recorded 1750000 4435938 respectively based upon fair value marketable securities accounts receivable company maintains reserves potential credit losses accounts receivable management reviews composition accounts receivable analyzes historical bad debts customer concentrations customer credit worthiness current economic trends changes customer payment patterns evaluate adequacy reserves recorded primarily specific identification basis june 30 2009 2008 company balances 67500 3044520 accounts receivable balance june 30 2008 includes securities receivable 3000000 fair market value shares date merger consummated june 30 2008 impairment longlived assets effective january 1 2002 company adopted statement financial accounting standards 144 accounting impairment disposal longlived assets sfas 144 addresses financial accounting reporting impairment disposal longlived assets supersedes sfas 121 accounting impairment longlived assets longlived assets disposed accounting reporting provisions apb opinion 30 reporting results operations disposal segment business company periodically evaluates carrying value longlived assets held used accordance sfas 144 sfas 144 requires impairment losses recorded longlived assets used operations indicators impairment present undiscounted cash flows estimated generated assets less assets carrying amounts event loss recognized based amount carrying amount exceeds fair market value longlived assets loss longlived assets disposed determined similar manner except fair market values reduced cost disposal property equipment property equipment stated cost maintenance repair costs charged expense incurred costs major additions betterments capitalized property equipment sold otherwise disposed cost related accumulated depreciation eliminated accounts resulting gain loss reflected income depreciation computed using straightline method estimated useful lives assets ranging three ten years depreciation amortization cost property equipment depreciated estimated useful lives related assets depreciation amortization fixed assets computed straightline basis net earnings per share company adopted provisions statement financial accounting standards 128 earnings per share sfas 128 sfas 128 eliminates presentation primary fully diluted earnings per share eps requires presentation basic diluted eps basic eps computed dividing income loss available common stockholders weightedaverage number common shares outstanding period diluted eps based weightedaverage number shares common stock outstanding period common stock equivalents outstanding end period company following dilutive stock warrants june 30 2009 2008 stockbased compensation effective july 1 2006 company adopted sfas 123r accordingly adopted modified prospective application method sfas 123r applied new awards modified repurchased cancelled effective date additionally compensation cost portion awards outstanding date adoption requisite service rendered unvested options recognized period time remaining requisite services rendered fair value financial instruments effective july 1 2008 company adopted statement financial accounting standards 157 sfas 157 fair value measurements adopted statement assets liabilities shown table sfas 157 clarifies definition fair value prescribes methods measuring fair value establishes fair value hierarchy based inputs used measure fair value expands disclosures use fair value measurements adoption sfas 157 material impact fair value measurements financial accounting standards board fasb staff position sfas 1572 effective date sfas 157 permits company defer recognition measurement nonfinancial assets nonfinancial liabilities january 1 2009 june 30 2009 company nonfinancial assets nonfinancial liabilities recognized disclosed fair value sfas 157 requires financial assets liabilities reported fair value categorized one following types investments based upon methodology determining fair value level 1 quoted prices active markets identical assets liabilities level 2 observable inputs level 1 prices quoted prices similar assets liabilities quoted prices markets active inputs observable corroborated observable market data substantially full term assets liabilities level 3 unobservable inputs supported little market activity significant fair value assets liabilities company utilizes various approaches measure fair value availableforsale securities asets measured fair value recurring basis summarized company financial liabilities measured fair value recurring basis revenue recognition companys revenue recognition policies compliance staff accounting bulletin sab 104 company recognizes consulting advisory fee revenues transaction completed service fees earned expenses recognized period corresponding liability incurred payments received relevant criteria revenue recognition recorded unearned revenue advertising company expenses advertising costs incurred advertising costs years ended june 30 2009 2008 12650and 10759 respectively comprehensive income loss statement financial accounting standards 130 reporting comprehensive income sfas 130 establishes standards reporting display comprehensive income components accumulated balances comprehensive income defined include changes equity except resulting investments owners distributions owners among disclosures sfas 130 requires items required recognized current accounting standards components comprehensive income reported financial statement displayed prominence financial statements year ended june 30 2009 2008 company recorded 2110305 5523975 unrealized loss marketable securities respectively comprehensive loss presented accompanying consolidated balance sheets amounted 0 1522997 june 30 2009 2008 respectively income taxes company accounts income taxes accordance sfas 109 accounting income taxes deferred taxes provided liability method whereby deferred tax assets recognized deductible temporary differences deferred tax liabilities recognized taxable temporary differences temporary differences reported amounts assets liabilities tax bases deferred tax assets reduced valuation allowance opinion management likely portion deferred tax assets realized deferred tax assets liabilities adjusted effects changes tax laws rates date enactment reporting segments statement financial accounting standards 131 disclosures segments enterprise related information sfas 131 supersedes statement financial accounting standards 14 financial reporting segments business enterprise establishes standards way public enterprises report information operating segments annual financial statements requires reporting selected information operating segments interim financial statements regarding products services geographic areas major customers sfas 131 defines operating segments components enterprise separate financial information available evaluated regularly chief operating decision maker deciding allocate resources assessing performance company operates one segment years ended june 30 2009 2008 risks uncertainties normal course business company subject certain risks uncertainties company provides service receives marketable securities upon execution transactions consequently value securities received customers affected economic fluctuations customers business growth actual realized value securities could significantly different recorded value reclasifications comparative purposes prior years consolidated financial statements reclassified conform report classifications current year recent accounting pronouncements december 2007 fasb issued sfas 141 revised 2007 “business combinations” objective statement significantly change accounting business combinations statement 141r acquiring entity required recognize assets acquired liabilities assumed transaction acquisition date fair value limited exceptions statement 141 applies prospectively business combinations acquisition date beginning first annual reporting period beginning december 15 2008 company expect adoption sfas 141r material impact consolidated financial statements december 2007 fasb issued sfas 160 “noncontrolling interests consolidated financial statementsan amendment arb 51 objective statement establish new accounting reporting standards noncontrolling interest subsidiary deconsolidation subsidiary statement 160 effective fiscal years interim periods within fiscal years beginning december 15 2008 company expect adoption sfas 160 material impact consolidated financial statements march 2008 fasb issued statement financial accounting standards “sfas” 161 disclosures derivative instruments hedging activities amendment fasb statement 133 requires additional disclosures objectives derivative instruments hedging activities method accounting instruments sfas 133 related interpretations tabular disclosure effects instruments related hedged items financial position financial performance cash flows company expect adoption sfas 161 material impact consolidated financial statements may 2008 fasb issued sfasb no162 “the hierarchy generally accepted accounting principles” pronouncement mandates gaap hierarchy reside accounting literature opposed audit literature practical impact elevating fasb statements financial accounting concepts gaap hierarchy pronouncement become effective 60 days following sec approval company expect pronouncement impact consolidated financial statements may 2008 fasb issued sfasb 163 “accounting financial guarantee insurance contractsan interpretation fasb statement 60” scope statement limited financial guarantee insurance reinsurance contracts pronouncement effective fiscal years beginning december 31 2008 company expect pronouncement impact consolidated financial statements june 2008 financial accounting standards board fasb issued fasb staff position fsp emerging issues task force eitf 0361 “determining whether instruments granted sharebased payment transactions participating securities” fsp unvested sharebased payment awards contain rights receive nonforfeitable dividends whether paid unpaid participating securities included twoclass method computing eps fsp effective financial statements issued fiscal years beginning december 15 2008 company expect fsp eitf 0361 would material impact consolidated financial statements april 2009 fasb issued fasb staff position “fsp” fas 1071 apb 281 interim disclosures fair value financial instruments “fsp fas 1071 apb 281” amends sfas 107 disclosures fair value financial instruments require disclosures fair value financial instruments interim reporting periods well annual reporting periods fsp fas 1071 apb 281 effective interim annual reporting periods ending june 15 2009 company expect fsp 1071 would material impact consolidated financial statements april 2009 fasb issued fsp fas 1574 determining fair value volume level activity asset liability significantly decreased identifying transactions orderly fsp 1574 fsp fasb 1071 accounting principles board apb 281 interim disclosures fair value financial instruments fsp 1071 two staff positions relate fair value measurements related disclosures fasb also issued third fsp relating accounting impaired debt securities titled fsp fas 1152 fas 1242 recognition presentation otherthantemporary impairments fsp 1152 standards effective interim annual periods ending june 15 2009 fsp 1574 fsp 1152 currently apply company’s activities company adopt disclosure requirements fsp 1071 may 2009 fasb issued statement 165 “subsequent events” “sfas 165” establishes general standards accounting requires disclosure events occur balance sheet date financial statements issued available issued adopted provisions sfas 165 quarter ended june 30 2009 adoption provisions material effect consolidated financial statements june 2009 fasb issued sfas 167 amendments fasb interpretation 46r sfas 167 amendments include 1 elimination exemption qualifying special purpose entities 2 new approach determining consolidate variableinterest entity 3 changes necessary reassess consolidate variableinterest entity sfas 167 effective first annual reporting period beginning november 15 2009 interim periods within first annual reporting period company adopt sfas 167 fiscal 2010 evaluating impact consolidated results company june 2009 financial accounting standards board “fasb” issued statement financial accounting standards “sfas” 168 “the fasb accounting standards codification hierarchy generally accepted accounting principles” “sfas 168” sfas 168 establishes fasb accounting standards codification “codification” single source authoritative nongovernmental us gaap codification effective interim annual periods ending september 15 2009 adoption standard material impact financial statements note 3 nasd examination discontinuance providential securities inc completion routine audit providential securities inc providential july august 2000 national association securities dealers inc alleged providential violated certain provisions nasds conduct rules 2120 2330 2110 3010 rules 15c24 10b5 10b9 15c33 securities exchange commission providential securities inc henry fahman voluntarily submitted letter acceptance waiver consent awc accepted nasd regulation inc october 27 2000 providential securities inc censured fined 11500000 required offer rescission public customers participated providential private placement addition henry fahman banned capacities associating nasd member based upon abovementioned circumstances providential securities inc withdrew membership nasd october 2000 ceased securities brokerage operation fine 115000 included accrued expenses accompanying consolidated financial statements company offered preferred stock holders rescission investment year ended june 30 2004 235000 amount due preferred stock holders plus 105600 related dividends payable totaling 340600 paid either cash issuance common stock balance unredeemed preferred shares related interest included current liabilities accompanying consolidated financial statements note 12 note 4 loans receivable related parties loans receivable related parties consist following june 30 2009 2008 loans biowarm ddc industries cavico unsecured interest free due demand ddc industries became subsidiary companynote 1 loan eliminated consolidation loans jeantex group provimex htv unsecured bear 85 interest per annum due demand 30000 loan pho express bears 325 interest per annum remaining portion interest free due demand loans pho express applied toward payment investment upon closing joint venture agreement year ended june 30 2009 interest income loans recorded receiving interests assured note 5 current assets comprise following june 30 2009 2008 note 6 marketable equity securities available sale company’s marketable securities classified availableforsale carried fair value securities comprised shares common stock investee securities classified availableforsale may sold response changes interest rates liquidity needs purposes investment marketable securities represents less twenty percent 20 outstanding common stock equivalents investee security nationally quoted national association securities dealers otc bulletin board otcbb pink sheets investment accounted accordance provisions sfas 115 following summary marketable equity securities classified available sale june 30 2009 changes net unrealized holding gainloss securities available sale included separate component stockholders equity years ended june 30 2009 2008 unrealized loss 0 1522997 recorded respectively year ended june 30 2009 company sold 6645584 shares eastbridge investment stock 202337 company sold 335000 shares cavico corp 60853 delivered 300000 shares cavico corp payment interest amounting 45000 addition company received 7270000 shares catthai corporation services 6000000 shares recorded revenue year ended june 30 2008 company purchased 1200 shares catthai corporation 2371 year ended june 30 2009 company received 3500000 shares vietnam united steel corporation services company used 1500000 shares line inc payment services valued 30000 sold 85000 shares 4325 march 2007 biowarm entered purchase agreement acquire 100 vietnambased dai dung metallic manufacture construction trade company ddmmct changed name ddc industries inc company received 7527506 shares advisory services equivalent 20 issued outstanding shares ddc industries inc merger agreement ddmmct rescinded november 18 2008 entirety shareholders ddmmct agreed return 28610025 shares 30110025 issued shares december 1 2008 ddc industries inc changed name phi mining group december 1 2008 indochina mining corporation subsidiary company entered stock purchase agreement phi mining group exchange capital stock number newly issued shares phi mining group result company owned 83 phi mining group inc december 1 2008 prior merger phi mining group indochina company held 20 interest ddci industries increased 76 result rescission mentioned subsequent acquisition company’s subsidiary indochina phi mining group ddci industries resulted increase company’s interest 83 transaction recorded related party transaction resulted capitalization phi mining group company year ended june 30 2009 23285714 shares jeantex group inc exchanged 900000 shares philand corporation owned company recorded realized loss sale marketable securities 4018 965 including realized loss 2074647 securities ddci became subsidiary company year ended june 30 2009 gain 701832 year ended june 30 2008 note 7 property equipment property equipment june 30 2009 2008 consists following depreciation expenses 15842 2634 fiscal years ended june 30 2009 2008 respectively note 8 construction progress construction progress represents costs incurred philand corporation subsidiary company real estate development amounting 657462 june 30 2009 costs included interest capitalized 80952 note 9 accounts payable accrued expenses accounts payable accrued expenses june 30 2009 2008 consist following accounts payable accrued expenses 1167455 379175 accrued salaries payroll taxes 300 199 166557 accrued interest 833607 551323 accrued legal 385084 339804 accrued consulting fees 177981 168870 2864325 1605728 year ended june 30 2009 company forgiven accrued interest 131808 certain short term notes amount recorded gain settlement debts consolidated financial statements year ended june 30 2008 company wrote 66719 old accounts payable statue limitation set state expired amount recorded gain settlement debts consolidated financial statements note 10 due officer due officer represents advances made officers company subsidiaries noninterest bearing except 100000 described unsecured due demand june 30 2009 2008 balances 1013561 561982 respectively june 30 2009 company short term note payable amounting 100000 interest bearing 3000 per month payable former chief technology officer cto note 11 loans promissory notes short term notes payable june 30 2009 2008 company short term notes payable amounting 2310085 1816255 accrued interest 833607 340753 respectively notes bear interest rates ranging 6 36 per annum 1811500 short term notes past due 315535 due demand year ended june 30 2009 2008 company paid 167485and 174000 principal 200135 1961888 interest short term notes respectively due preferred stockholders company classified 215000 preferred stock subscribed current liability payable holders preferred stock due non compliance preferred shares subscription agreement amount past due june 30 2009 interest payable holders preferred stock 232655 206855 included accrued interest included account payable accrued expenses balance sheet june 30 2009 2008 respectively current liabilities year ended june 30 2004 company received overpayment 89691 exercise stock options receivable amount paid company june 30 2009 classified payable shown consolidated financial statements current liabilities note 12 litigation legal proceeding settled unpaid june 30 2009 quang van cao nhan thi nguyen cao vs providential securities inc et al case originally submitted orange county superior court ca june 25 1997 case 781121 subsequently moved nasd dispute resolution arbitration august 24 2000 companys legal counsel negotiated claimants counsel unilaterally reached settlement approved company process renegotiating terms said settlement claimants filed request arbitration hearing national association securities dealers october 4 2000 case 9903160 thereafter claimants filed complaint orange county superior court ca october 31 2000 case 00cc13067 alleged breach contract damages sum 75000 plus prejudgment interest costs incurred connection complaint relief without admitting denying allegations company reached settlement agreement claimants whereby company would pay claimants total 62500 plus 4500 administrative costs date report company paid 2500 subject entry judgment 79000 settlement amount accrued accompanying consolidated financial statements conseco finance vendor services corporation fka green tree vendor services corporation vs providential securities inc henry fahman tina phan september 1997 providential securities inc entered written lease agreement lease certain items equipment green tree vendor services return providential securities inc agreed pay thirtysix monthly installments amount 1552 september 12 2000 subsequently providential securities inc unable make monthly payments claimant due lack revenues following interruption subsequent closure securities brokerage operations see note 3 claimant filed complaint money superior court state california county orange case 01cc02613 february 23 2001 seeking 39102 plus interest thereon legal rate september 12 2000 claimant entered judgment providential securities inc henry fahman tina phan 48933 judgment amount accrued accompanying consolidated financial statements pending litigation ngon vu vs providential securities inc claimant former employee providential securities inc laid 2000 due closure business claimant complained department industrial relations dir allegedly unpaid vacation salaries june 13 2001 dir filed request enter judgment providential securities inc 9074 including wages interest penalty post hearing filing fee sought amount 9074 accrued accompanying consolidated financial statements verio vs providential securities inc april 1 2003 verio inc filed judgment providential securities inc whollyowned subsidiary company discontinued october 2000 total 9141 sum consists 6800 services allegedly rendered verio inc providential securities inc 2000 2341 legal costs amounts accrued accompanying consolidated financial statements dow jones company inc vs providential securities inc phi group inc march 19 2002 dow jones company filed complaint superior court california county orange west justice center case 02wl1633 providential securities inc discontinued operations company phi group inc 9973 plus prejudgment interest rate ten 10 per annum november 1 2000 reasonable attorneys’ fees relief claim connection services allegedly rendered plaintiff providential securities inc prior november 2000 company intends settle case sought amount 9973 excluding interest accrued expenses accompanying consolidated financial statements key equipment finance inc vs 496215601204 providential securities inc henry fahman tina phan case 06wl00289 january 18 2006 key equipment finance filed suit superior court state california county orange west district claiming breach terms lease agreement failure make monthly installment due although demand therefore made remaining balance due owing plaintiff lease 14439 plus interest date default plaintiff also claiming breach guaranty common counts unjust enrichment cost law suit relief court may deem proper june 30 2008 company accrued 14439 nasd case completion routine audit providential securities inc july august 2000 national association securities dealers inc alleged providential violated certain provisions nasds conduct rules result providential securities inc withdrew membership nasd october 2000 ceased securities brokerage operation 127305 including 115000 fine charged nasd included accrued expenses accompanying consolidated financial statements note 3 arbitration cases company four arbitration cases daytraders providential securities inc discontinued stock brokerage operation company total amount damages cases closed june 30 2001 54505 amount accrued accompanying consolidated financial statements note 13 basic diluted net loss per share net loss per share calculated accordance sfas 128 earnings per share provision sfas 128 basic net loss per share computed dividing net loss period weightedaverage number common shares outstanding period diluted eps based weightedaverage number shares common stock outstanding period common stock equivalents outstanding end period basic diluted weighted average number shares year ended june 30 2009 since inclusion common stock equivalents antidilutive note 14 stockholders equity effective april 13 2009 company amended articles incorporation change par values preferred common stock 0001 company 400000000 authorized capital stock consisting 300000000 shares common stock 100000000 shares preferred stock effect change reflected retroactively consolidated financial statements treasury stock years ended june 30 2009 2008 company purchased 170000 120500 treasury shares 4233and 3784 respectively year ended june 30 2009 company used 1280000 shares treasury shares valued 36736 convert note 9336 company recorded 27400 loss conversion balance treasury stock 1330440 shares june 30 2009 valued 1330 common stock fiscal year ended june 30 2009 year ended june 30 2009 company issued 1300000 shares common stock valued 32500 payment accrued payroll consulting fees fiscal year ended june 30 2008 year ended june 30 2008 company issued 1800000 shares common stock valued 90000 services year ended june 30 2008 company issued 6000000 shares common stock conversion short term notes amounting 180000 year ended june 30 2008 company issued 14000000 shares common stock payment accrued salaries amounting 420000 officers shares issued 06092006 luberski inc transferred subsequently sold 1000000 shares common stock phi group inc belonged officer company given luberski inc collateral loan june 30 2007 company agreed pay back 1000000 shares valued 57000 officer recorded transaction shares issued prepaid consulting year ended june 30 2008 company signed consulting agreement consulting service one year company issued 1500000 shares common stock consultant valued 75000 based upon market value stock date stock issuance company amortized 37500 year ended june 30 2009 37500 year ended june 30 2008 subscriptions receivable subscription receivable balance 25500 june 30 2008 consultant shares issued year ended 2005 written fiscal year ended june 30 2009 note 15 stock based compensation plan stockbased compensation february 7 2005 company adopted stockbased compensation plan set aside 14000000 shares common stock selected eligible participants company subsidiaries certain independent contractors providing certain services company june 30 2009 13778512 shares issued salaries consulting professional services lieu cash plan prior july 1 2006 company measured stock compensation expense using intrinsic value method accounting accordance accounting principles board apb opinion 25 accounting stock issued employees related interpretations apb 25 company adopted sfas 123r effective july 1 2006 using modified prospective method warrants quarter ended september 30 2006 company issued 250000 stock warrants term 5 years three year vesting period following assumptions used blackscholes pricing model note 16 gain settlement debt year ended june 30 2009 2008 company recorded gain 187794 67719 settlement debt respectively note 9 11 note 17 related party transactions company accrued 210000 salaries henry fahman president company tina phan secretary company years ended june 30 2009 2008 years ended june 30 2009 2008 company 24000 consulting revenue company related common officer march 2007 biowarm entered purchase agreement acquire 100 vietnambased dai dung metallic manufacture construction trade company ddmmct changed name ddc industries inc company received 7527506 shares advisory services equivalent 20 issued outstanding shares ddc industries inc merger agreement ddmmct rescinded november 18 2008 entirety shareholders ddmmct agreed return 28610025 shares 30110025 issued shares december 1 2008 ddc industries inc changed name phi mining group december 1 2008 indochina mining corporation subsidiary company entered stock purchase agreement phi mining group exchange capital stock number newly issued shares phi mining group result company owned 83 phi mining group inc december 1 2008 prior merger phi mining group indochina company held 20 interest ddc industries increased 76 result recession mentioned subsequent acquisition company’s subsidiary indochina pmg mining group ddc industries resulted increase company’s interest 83 transaction recorded related party transaction resulted consolidation phi mining group company note 18 income taxes provision made income tax since company significant net operating loss carry forward june 30 2009 company incurred net operating losses tax purposes approximately 83 million net operating loss carry forward may used reduce taxable income year 2029 net operating loss carry forwards state california generally available reduce taxable income year 2029 availability companys net operating loss carryforward subject limitation 50 positive change ownership companys stock net deferred tax asset balance due net operating loss carryforwards june 30 2009 2008 approximately 67 million 34 million respectively 100 valuation allowance established deferred tax assets utilization loss carryforwards cannot reasonably assured following reconciliation provision income taxes us federal income tax rate income taxes reflected consolidated statements operations note 19 contracts commitments agreement hawk associates inc august 11 2006 company entered investor relations consulting agreement hawk associates inc florida corporation effective september 1 2006 according agreement hawk associates provide investor relations consulting services company period six months agreement automatically renew monthly notice provided one parties company agrees pay hawk associates 4500 per month investor relations consulting services hawk associates issued warrants purchase 250000 common shares company based closing price 0015 per share september 1 2006 warrants valid august 30 2011 business financial consutling agreement catthai plastic company june 25 2007 company entered business consulting agreement catthai plastic company “cathaco ltd” vietnamese company located ho chi minh city vietnam services include 1 taking cathaco public us via reverse merger business combination ipo 2 arranging intermediate funding become fullyreporting publicly traded company otcbb higher exchange us 3 subsequent listings new company’s shares berlin frankfurt stock exchanges necessary 4further longterm funding capital requirements needed company recorded 3000000 part accounts receivable based fair market value 6000000 shares date merger consummated june 30 2008 period ended december 31 2008 company received 6000000 shares 1270000 additional shares transaction related stock purchased strategia merger business cooperation agreement pho express september 19 2007 provimex inc subsidiary company entered business cooperation agreement owner pho express establish new vietnamese style noodle soup restaurant pho express international llc pho express agreed contribute assets liabilities exchange 40 equity ownership provimex agreed pay 165000 exchange 60 equity ownership pho express international llc company paid 96100 toward investment loaned 13500 pho express june 30 2009 business cooperation agreement closed date report business financial consulting agreement mast ventures llc effective april 1 2008 company entered business financial consulting agreement mast ventures llc raise capital wholly owned subsidiary philand corporation 5 years service includes assistance identifying potential investors developing approach seeking current financing investor relations company agreed pay 5 total funds raised consultant office space lease company signed 5 year lease agreement corporate office effective may 1 2008 monthly rental 669070 increased 35 per annum commencing thirteenth month initial lease term continuing annually thereafter leases offices vietnam 12 months starting january 2008 july 2008 monthly rental ranging approximately 625 4100 per month future commitments operating leases follows twelve months ending june 30 83091 86007 89017 76777 total minimum lease payments 334892 rent expense 147043 81130 year ended june 30 2009 2008 respectively note 20 going concern uncertainty shown accompanying consolidated financial statements company accumulated deficit 23312661 negative cash flow operations amounting 550329 year ended june 30 2009 factors well uncertain conditions company faces daytoday operations respect cash flows create uncertainty companys ability continue going concern financial statements include adjustments might necessary company unable continue going concern management taken action strengthen companys working capital position generate sufficient cash meet operating needs june 30 2010 beyond company also anticipates generating revenue proposed mergers acquisitions assurances made management successful achieving plan president chairman company committed funding companys operations next 12 months note 21 subsequent events june 5 2009 philand ranch limited company registered laws england wales acquired issued outstanding common stock philand corporation exchange amount ordinary shares philand ranch limited result stock exchange philand corporation philand ranch limited company currently owns 18734753 shares ordinary stock philand ranch limited effective september 07 2009 philand ranch limited’s ordinary stock approved trade open market segment frankfurt stock exchange symbol 1p8f wkn a0rpea item 9 item 8 financial statements phi group inc auditors’ report ms madhava rao sungold avenue eastvale ca 92880 report independent registered public accounting firm shareholders board directors phi group inc opinion financial statements audited accompanying balance sheet phi group inc “company” june 30 2020 related statement operations changes stockholders’ equity deficit cash flows related notes schedules collectively referred “financial statements” opinion financial statements present fairly material respects financial position company june 30 2020 results operations cash flows period ended june 30 2020 conformity accounting principles generally accepted united states america basis opinion financial statements responsibility company’s management responsibility express opinion company’s financial statements based audits public accounting firm registered public company accounting oversight board united states “pcaob” required independent respect company accordance us federal securities laws applicable rules regulations securities exchange commission pcaob conducted audits accordance standards pcaob standards require plan perform audit obtain reasonable assurance whether financial statements free material misstatement whether due error fraud audits included performing procedures assess risks material misstatement financial statements whether due error fraud performing procedures respond risks procedures included examining test basis evidence regarding amounts disclosures financial statements audits also included evaluating accounting principles used significant estimates made management well evaluating overall presentation financial statements believe audits provide reasonable basis opinion critical audit matters critical audit matters communicated matters arising current period audit financial statements communicated required communicated audit committee 1 relate accounts disclosures material financial statements 2 involved especially challenging subjective complex judgments communication critical audit matters alter way opinion financial statements taken whole communicating critical audit matters providing separate opinions critical audit matters accounts disclosures relate critical audit matters company’s financial statements prepared using generally accepted accounting principles applicable going concern contemplates realization assets liquidation liabilities normal course business company accumulated deficit 44010352 stockholders’ deficit 7059790 june 30 2020 factors discussed note 19 financial statements raise substantial doubt company’s ability continue going concern management’s plans regard matters also described note 19 consolidated financial statements include adjustments might result outcome uncertainties ms madhava rao ms madhava rao eastvale california june 22 2021 phi group inc subsidiaries consolidated balance sheets audited accompanying notes form integral part audited consolidated financial statements accompanying notes form integral part audited consolidated financial statements phi group inc subsidiaries consolidated statements cash flows years ended june 30 2020 2019 audited accompanying notes form integral part audited consolidated financial statements phi group inc subsidiaries statement stockholders’ equity deficit years ended june 30 2019 2018 audited phi group inc subsidiaries statement stockholders’ equity deficit years ended june 30 2020 2019 audited par value 004 per share prior 4132009 0001 per share 4132009 accompanying notes form integral part audited consolidated financial statements phi group inc subsidiaries formerly providential holdings inc notes consolidated financial statements note 1 nature business phi group inc “company” “phi” wwwphiglobalcom primarily engaged operations philux global funds sca sicavraif “reserved alternative investment fund” “raif” laws luxembourg development asia diamond exchange vietnam besides company provides corporate finance services including merger acquisition advisory consulting services client companies wholly owned subsidiary philux capital advisors inc formerly phi capital holdings inc wwwphiluxcapcom invests selective industries well special situations aiming potentially create significant longterm value shareholders philux global funds intends hold number subfunds investment agriculture renewable energy real estate infrastructure healthcare asia diamond exchange vietnam background originally incorporated june 8 1982 jr consulting inc nevada corporation company operated nevada corporation june 30 2020 filed certificate dissolution secretary state nevada started operate wyoming corporation pursuant articles domestication filed wyoming secretary state september 20 2017 beginning company foremost engaged mergers acquisitions operating subsidiary diva entertainment inc operated modeling agencies new york california january 2000 company changed name providential securities inc nevada corporation following business combination providential securities inc californiabased financial services company february 2000 company changed name providential holdings inc october 2000 providential securities withdrew securities brokerage membership ceased financial services business subsequently april 2009 company changed name phi group inc october 2000 october 2011 company subsidiaries engaged mergers acquisitions advisory consulting services real estate hospitality development mining oil gas telecommunications technology healthcare private equity special situations october 2011 company discontinued operations providential vietnam ltd philand ranch limited united kingdom corporation listed frankfurt stock exchange together subsidiaries philand ranch singapore philand corporation us philand vietnam ltd vietnam phi gold corporation formerly phi mining corporation nevada corporation publicly traded company phi energy corporation nevada corporation mainly focused acquisition development opportunities energy natural resource businesses company currently focused operating philux global funds sca sicavraif setting number subfunds investment real estate renewable energy infrastructure agriculture healthcare well developing establishing asia diamond exchange vietnam addition philux capital advisors inc formerly capital holdings inc wholly owned subsidiary company serves investment advisor philux global funds continues provide corporate project finance services including merger acquisition advisory consulting services client companies assurances made company successful achieving plans note 2 summary significant accounting policies principles consolidation consolidated financial statements include accounts phi group inc wholly owned subsidiaries 1 philux global funds sca sicavraif luxembourg bank fund designed hold number subfund compartments investing various selective industries 2 phi luxembourg development sa mother holding company philux global funds 3 phi luxembourg holding sa 4 philux global general partner sa 5 philux capital advisors inc wyoming corporation 100 american pacific resources inc wyoming corporation 100 6 american pacific plastics inc wyoming corporation collectively referred “company” significant intercompany transactions eliminated consolidation use estimates preparation consolidated financial statements conformity accounting principles generally accepted united states america requires management make estimates assumptions affect reported amounts assets liabilities disclosure contingent assets liabilities date financial statements reported amounts revenues expenses reporting period actual results could differ estimates cash equivalents company considers liquid investments maturity three months less date purchase readily convertible cash equivalents marketable securities company’s securities classified availableforsale carried fair value securities classified availableforsale may sold response changes interest rates liquidity needs purposes investment marketable securities typically represents less twenty percent 20 outstanding common stock equivalents investee security quoted national exchange otc markets investment accounted accordance provisions asc 320 previously sfas 115 unrealized holding gains losses availableforsale securities excluded earnings reported separate component stockholder’s equity realized gains losses securities classified availableforsale reported earnings based upon adjusted cost specific security sold june 30 2020 2019 marketable securities recorded 235088 213485 respectively based upon fair value marketable securities time accounts receivable management reviews composition accounts receivable analyzes historical bad debts account receivable bad debt fiscal ended june 30 2020 impairment longlived assets effective january 1 2002 company adopted asc 350 previously sfas 144 “accounting impairment disposal longlived assets” addresses financial accounting reporting impairment disposal longlived assets supersedes sfas 121 “accounting impairment longlived assets longlived assets disposed of” accounting reporting provisions apb opinion 30 “reporting results operations disposal segment business” company periodically evaluates carrying value longlived assets held used accordance asc 350 asc 350 requires impairment losses recorded longlived assets used operations indicators impairment present undiscounted cash flows estimated generated assets less assets’ carrying amounts event loss recognized based amount carrying amount exceeds fair market value longlived assets loss longlived assets disposed determined similar manner except fair market values reduced cost disposal property equipment property equipment stated cost maintenance repair costs charged expense incurred costs major additions betterments capitalized property equipment sold otherwise disposed cost related accumulated depreciation eliminated accounts resulting gain loss reflected income depreciation computed using straightline method estimated useful lives assets ranging three ten years depreciation amortization cost property equipment depreciated estimated useful lives related assets depreciation amortization fixed assets computed straightline basis net earnings loss per share company adopted provisions asc 260 previously sfas 128 asc 260 eliminates presentation primary fully diluted earnings per share “eps” requires presentation basic diluted eps basic eps computed dividing income loss available common stockholders weightedaverage number common shares outstanding period diluted eps based weightedaverage number shares common stock outstanding period common stock equivalents outstanding end period net earnings loss per share computed follows stockbased compensation effective july 1 2006 company adopted asc 7181025 previously sfas 123r accordingly adopted modified prospective application method asc 7181025 applied new awards modified repurchased cancelled effective date additionally compensation cost portion awards outstanding date adoption requisite service rendered unvested options recognized period time remaining requisite services rendered fair value financial instruments fair value definition hierarchy fair value defined price would received sell asset paid transfer liability orderly transaction market participants measurement date assets liabilities measured fair value categorized based whether inputs observable market degree inputs observable categorization financial assets liabilities within valuation hierarchy based upon lowest level input significant fair value measurement fair value hierarchy inputs used measuring fair value maximizes use observable inputs minimizes use unobservable inputs requiring observable inputs used available valuation techniques consistent market income approach used measure fair value fair value hierarchy categorized three levels based inputs follows level 1 valuations based unadjusted quoted prices active markets identical assets liabilities fund ability access level 2 valuations based inputs quoted prices included level 1 observable either directly indirectly level 3 valuations based inputs unobservable significant overall fair value measurement fair value marketbased measure based assumptions prices inputs considered perspective market participant current measurement date rather entityspecific measure therefore even market assumptions readily available company’s assumptions set reflect market participants would use pricing asset liability measurement date availability valuation techniques observable inputs vary investment affected wide variety factors including type investment whether investment new yet established marketplace liquidity markets characteristics particular transaction extent valuation based upon models inputs less observable unobservable market determination fair value requires judgment inherent uncertainty valuation estimated values may materially higher lower values would used ready market investments existed accordingly degree judgment exercised fund determining fair value greatest investments categorized level 3 certain cases inputs used measure fair value may fall different levels fair value hierarchy cases level fair value hierarchy fair value measurement falls entirety determined based upon lowest level input significant fair value measurement fair value valuation techniques inputs company holds may invest public securities traded public exchanges overthecounter otc private securities real estate convertible securities interest bearing securities types securities adopted specific techniques respective valuations equity securities public companies unrestricted company values investments securities freely tradable listed major securities exchanges last reported sales price valuation date extent securities actively traded valuation adjustments applied categorized level 1 fair value hierarchy securities traded inactive markets valued reference similar instruments generally categorized level 2 3 fair value hierarchy restricted securities traded public exchanges overthecounter otc formal restrictions limit ie rule 144 holding periods underwriter’s lockups sale shall valued closing price date valuation less applicable discounts company may apply discount securities rule 144 restrictions additional discounts may assessed company believes mitigating factors warrant additional discounting determining potential additional discounts factors taken consideration include limited securities’ trading characteristics volume length overall impact restriction well macroeconomic factors valuations discounted appropriately securities may freely traded determined exchange otc listed price accurately reflect fair market value company may elect treat security private company apply alternative valuation method investments restricted securities public companies may included level 2 fair value hierarchy however extent significant inputs used determine liquidity discounts observable investments restricted securities public companies may categorized level 3 fair value hierarchy company’s financial instruments primarily consist cash equivalents accounts receivable marketable securities shortterm notes payable convertible notes derivative liability accounts payable balance sheet dates estimated fair values financial instruments materially different carrying values presented balance sheet primarily attributed short maturities instruments effective july 1 2008 company adopted asc 820 previously sfas 157 fair value measurements adopted statement assets liabilities shown table asc 820 clarifies definition fair value prescribes methods measuring fair value establishes fair value hierarchy based inputs used measure fair value expands disclosures use fair value measurements adoption asc 820 material impact fair value measurements asc 820 permits company defer recognition measurement nonfinancial assets nonfinancial liabilities january 1 2010 june 30 2018 company nonfinancial assets nonfinancial liabilities recognized disclosed fair value asc 820 requires financial assets liabilities reported fair value categorized one types investments based upon methodology mentioned level 1 level 2 level 3 determining fair value assets measured fair value recurring basis summarized company also convertible notes derivative liabilities disclosed report measured fair value regular basis paid exercised company uses various approaches measure fair value availableforsale securities applying threelevel valuation hierarchy disclosures specified asc 820 level 1 securities measured using quoted prices active markets identical assets liabilities company’s policy regarding transfers andor level 3 depends trading activity security volatility security observable units clearly represents fair value security level 3 security measured using fairly represented fair value transfer securities either level 1 level 2 depending type inputs revenue recognition standards asc 60610 provides following overview revenue recognized entity’s contracts customers entity recognizes revenue depict transfer promised goods services customers amount reflects consideration entity expects entitled exchange goods services step 1 identify contracts customer step 2 identify performance obligations contract step 3 determine transaction price transaction price amount consideration contract entity expects entitled exchange transferring promised goods services customer step 4 allocate transaction price performance obligations contract entity typically allocates transaction price performance obligation basis relative standalone selling prices distinct good service promised contract step 5 recognize revenue entity satisfies performance obligation entity recognizes revenue satisfies performance obligation transferring promised good service customer obtains control good service amount revenue recognized amount allocated satisfied performance obligation performance obligation may satisfied point time typically promises transfer goods customer time typically promises transfer service customer performance obligations satisfied time entity recognizes revenue time selecting appropriate method measuring entity’s progress toward complete satisfaction performance obligation paragraphs 60610 2523 2530 addition asc 60610 contains guidance disclosures related revenue notes following also includes cohesive set disclosure requirements would result entity providing users financial statements comprehensive information nature amount timing uncertainty revenue cash flows arising entity’s contracts customers specifically section 6061050 requires entity provide information revenue recognized contracts customers including disaggregation revenue appropriate categories contract balances including opening closing balances receivables contract assets contract liabilities performance obligations including entity typically satisfies performance obligations transaction prices allocated remaining performance obligations contract significant judgments changes judgments made applying requirements contracts additionally section 3404050 requires entity provide quantitative andor qualitative information assets recognized costs obtain fulfill contract customer company’s revenue recognition policies compliance asc 60610 company recognizes consulting advisory fee revenues accordance abovementioned guidelines expenses recognized period corresponding liability incurred advertising company expenses advertising costs incurred advertising costs years ended june 30 2020 2019 12812 50377 respectively decrease advertising expenses primarily due decrease investor relations expenses fiscal year ended june 30 2020 comprehensive income loss asc 2201045 previously sfas 130 reporting comprehensive income establishes standards reporting display comprehensive income components accumulated balances comprehensive income defined include changes equity except resulting investments owners distributions owners among disclosures sfas 130 requires items required recognized current accounting standards components comprehensive income reported financial statement displayed prominence financial statements june 30 2020 2019 respectively accumulated comprehensive income loss 135301 0 presented accompanying consolidated balance sheets income taxes company accounts income taxes accordance asc 740 previously sfas 109 “accounting income taxes” deferred taxes provided liability method whereby deferred tax assets recognized deductible temporary differences deferred tax liabilities recognized taxable temporary differences temporary differences reported amounts assets liabilities tax bases deferred tax assets reduced valuation allowance opinion management likely portion deferred tax assets realized deferred tax assets liabilities adjusted effects changes tax laws rates date enactment reporting segments asc 280 previously statement financial accounting standards 131 disclosures segments enterprise related information supersedes statement financial accounting standards 14 financial reporting segments business enterprise establishes standards way public enterprises report information operating segments annual financial statements requires reporting selected information operating segments interim financial statements regarding products services geographic areas major customers asc 280 defines operating segments components enterprise separate financial information available evaluated regularly chief operating decision maker deciding allocate resources assessing performance company operated one revenuegenerating segment years ended june 30 2020 june 30 2019 risks uncertainties normal course business company subject certain risks uncertainties company provides service receives marketable securities upon execution transactions consequently value securities received customers affected economic fluctuations customer’s business growth actual realized value securities could significantly different recorded value recent accounting pronouncements update 201813 august 2018 fair value measurement topic 820 changes disclosure requirements fair value measurement modifications following disclosure requirements modified topic 820 1 lieu rollforward level 3 fair value measurements nonpublic entity required disclose transfers level 3 fair value hierarchy purchases issues level 3 assets liabilities 2 investments certain entities calculate net asset value entity required disclose timing liquidation investee’s assets date restrictions redemption might lapse investee communicated timing entity announced timing publicly 3 amendments clarify measurement uncertainty disclosure communicate information uncertainty measurement reporting date additions following disclosure requirements added topic 820 however disclosures required nonpublic entities 1 changes unrealized gains losses period included comprehensive income recurring level 3 fair value measurements held end reporting period 2 range weighted average significant unobservable inputs used develop level 3 fair value measurements certain unobservable inputs entity may disclose quantitative information median arithmetic average lieu weighted average entity determines quantitative information would reasonable rational method reflect distribution unobservable inputs used develop level 3 fair value measurements amendments update effective entities fiscal years interim periods within fiscal years beginning december 15 2019 update 201807 june 2018 compensation stock compensation topic 718 improvements nonemployee sharebased payment accounting main provisions amendments update expand scope topic 718 include sharebased payment transactions acquiring goods services nonemployees entity apply requirements topic 718 nonemployee awards except specific guidance inputs option pricing model attribution cost period time sharebased payment awards vest pattern cost recognition period amendments specify topic 718 applies sharebased payment transactions grantor acquires goods services used consumed grantor’s operations issuing sharebased payment awards amendments also clarify topic 718 apply sharebased payments used effectively provide 1 financing issuer 2 awards granted conjunction selling goods services customers part contract accounted topic 606 revenue contracts customers amendments update effective public business entities fiscal years beginning december 15 2018 including interim periods within fiscal year update 201713 september 2017 revenue recognition topic 605 revenue contracts customers topic 606 fasb accounting standards updates 201409 revenue contracts customers topic 606 issued may 2014 codified asc topic 606 revenue contracts customers 201602 transition provisions asc topic 606 require public business entity certain specified entities adopt asc topic 606 annual reporting 3 periods beginning december 15 2017 including interim reporting periods within reporting period fn2 entities required adopt asc topic 606 annual reporting periods beginning december 15 2018 interim reporting periods within annual reporting periods beginning december 15 2019 update 201610 april 2016 revenue contracts customers topic 606 identifying performance obligations licensing core principle guidance topic 606 entity recognize revenue depict transfer promised goods services customers amount reflects consideration entity expects entitled exchange goods services achieve core principle entity apply following steps 1 identify contracts customer 2 identify performance obligations contract 3 determine transaction price 4 allocate transaction price performance obligations contract 5 recognize revenue entity satisfies performance obligation amendments update change core principle guidance topic 606 rather amendments update clarify following two aspects topic 606 identifying performance obligations licensing implementation guidance retaining related principles areas company either evaluated currently evaluating implications pronouncements possible impact may company’s financial statements cases management determined implementation pronouncements would material impact financial statements taken whole note 3 loans receivable loans receivable consist following june 30 2020 2019 note 4 assets comprise following june 30 2020 2019 investments june 30 2020 consist 5000 investment aquarius power inc renewable energy technology company’s marketable securities classified availableforsale carried fair value securities comprised shares common stock investee securities classified availableforsale may sold response changes interest rates liquidity needs purposes investment marketable securities represents less twenty percent 20 outstanding common stock equivalents investee security nationally quoted national association securities dealers otc bulletin board “otcbb” otc markets investment accounted accordance provisions sfas 115 marketable securities owned company classified available sale june 30 2020 consisted 905000 shares myson group inc formerly vanguard mining corporation 292050000 shares sports pouch beverage company public companies traded otc markets trading symbols mysn spbv respectively fair value marketable securities recorded june 30 2020 235088 fiscal year ended june 30 2020 transfer securities level 3 level 2 note 5 property equipment june 30 2020 company property equipment note 6 current liabilities current liabilities company consist followings june 30 2020 2019 accrued expenses accrued expenses june 30 2020 consist 1539649 accrued salaries payroll taxes 1259720 accrued interest shortterm notes payable net notes payable consist 352200 shortterm notes payable 272207 convertible promissory notes advances customers advances customers 430500 june 30 2020 438000 june 30 2019 respectively subfund obilgations fiscal year ended june 30 2019 company received 800000 european plastic joint stock company towards expenses capitalization setting energy subfund 466634 saigon pho palace joint stock company towards expenses capitalization setting real estate subfund respectively master philux global funds company recorded amounts liabilities subfunds set activated time subfund participants receive 49 general partners’ portion ownership relevant subfunds total contribution 2000000 company recorded total 1266634 subfund obligations june 30 2020 june 30 2019 note 7 due officers directors due officer represents loans advances made officers directors company subsidiaries unsecured due demand june 30 2020 2019 balances 1696274 890897 respectively note 8 loans promissory notes short term notes payable course business company obtained shortterm loans individuals institutional investors time raised money issuing restricted common stock company auspices rule 144 june 30 2020 company 395950 shortterm notes payable consisting 352200 regular shortterm notes 43750 sba loan 1259094 accrued unpaid interest notes bear interest rates ranging 0 36 per annum convertible promissory notes june 30 2020 principal balance outstanding convertible notes 272207 total derivative liabilities 310870 company relies professional thirdparty valuation record value derivative liabilities discounts changes fair value derivatives connection convertible notes warrants related convertible notes note 9 payroll tax liabilities june 30 2020 payroll tax liabilities 5747 note 10 basic diluted net loss per share net loss per share calculated accordance sfas 128 “earnings per share” provision sfas 128 basic net loss per share computed dividing net loss period weightedaverage number common shares outstanding period diluted eps based weightedaverage number shares common stock outstanding period common stock equivalents outstanding end period basic diluted weighted average numbers shares year ended june 30 2020 since inclusion common stock equivalents antidilutive note 11 domestication state wyoming september 20 2017 company applied certificate domestication filed articles domestication office secretary state wyoming redomicile company’s jurisdiction state wyoming september 20 2017 company filed articles amendment wyoming secretary state amend authorized capital company follows “the total number shares authorized capital stock corporation divided one billion shares consisting nine hundred million shares voting common stock par value 0001 per share fifty million shares nonvoting class series preferred stock par value 500 per share twentyfive million shares nonvoting class series ii preferred stock par value 500 per share twenty million shares nonvoting class series iii preferred stock par value 500 per share five million shares voting class series iv preferred stock par value 500 per share relative rights preferences limitations restrictions associated aforementioned shares class preferred stock determined board directors corporation” june 25 2020 company filed articles amendment wyoming secretary state amend article 10 articles domestication authorize forty billion 40000000000 shares common stock par value 0001 per share five hundred million 500000000 shares preferred stock par value 0001 per share designate classes b series classes preferred stock following class preferred stock designations amounts dividends 1 class series cumulative convertible redeemable preferred stock designation fifty million 50000000 shares authorized 500000000 shares preferred stock par value 0001 per share designated class series cumulative convertible redeemable preferred stock b number shares number shares class series preferred stock authorized shall fifty million 50000000 shares c dividends holder class series preferred stock entitled receive ten percent 10 noncompounding cumulative dividends per annum payable semiannually 2 class series ii cumulative convertible redeemable preferred stock designation two hundred million 200000000 shares authorized 500000000 shares preferred stock par value 0001 per share designated class series ii cumulative convertible redeemable preferred stock “class series ii preferred stock” c number shares number shares class series ii preferred stock authorized shall two hundred million 200000000 shares c dividends holder class series ii preferred stock entitled receive eight percent 8 cumulative dividends per annum payable semiannually 3 class series iii cumulative convertible redeemable preferred stock designation fifty million 50000000 shares authorized 500000000 shares preferred stock par value 0001 per share designated class series iii cumulative convertible redeemable preferred stock “class series iii preferred stock” b number shares number shares class series iii preferred stock authorized shall fifty million 50000000 shares c dividends holder class series iii preferred stock entitled receive eight percent 8 cumulative dividends per annum payable semiannually 4 class series iv cumulative convertible redeemable preferred stock designation one hundred ninetynine million 199000000 shares authorized 500000000 shares preferred stock par value 0001 per share designated class series iv cumulative convertible redeemable preferred stock “class series iv preferred stock” b number shares number shares class series iii preferred stock authorized shall one hundred ninetynine million 199000000 shares c dividends determined corporation’s board directors b conversion 1 conversion series ii andor series iv class preferred stock common stock phi group inc share class preferred stock either series ii series iv shall convertible company’s common stock time two years date issuance variable conversion price defined herein common stock “variable conversion price” shall mean 75 multiplied market price defined herein representing discount rate 25 “market price” means average trading price company’s common stock ten 10 tradingday period ending one trading day prior date conversion notice sent holder class preferred stock company via facsimile email “conversion date” “trading price” means security date closing price otc markets otcqb nasdaq stock markets applicable trading market reported reliable reporting service “reporting service” mutually acceptable company holder class preferred stock 2 conversion series ii andor series iv class preferred stock common stock subsidiary phi group inc’s alternatively share class preferred stock either series ii andor series iv may convertible common stock subsidiary phi group inc’s determined company’s board directors time subsidiary become fullyreporting publicly traded company least three months variable conversion price defined herein variable conversion price used connection conversion common stock subsidiary phi group inc’s shall mean 50 multiplied market price defined herein representing discount rate 50 common stock “market price” means average trading price common stock said subsidiary phi group inc’s ten 10 tradingday period ending one trading day prior date conversion notice sent holder preferred stock company via facsimile email “conversion date” “trading price” means security date closing price otc markets otcqb nasdaq stock markets nyse applicable trading market reported reliable reporting service “reporting service” mutually acceptable company said subsidiary holder class preferred stock” 3 conversion class series iii preferred stock phi group inc common stock american pacific plastics inc subsidiary phi group inc’s entire class series iii preferred stock phi group inc ie fifty million 50000000 shares may convertible eighty percent 80 american pacific plastics inc’s common stock issued outstanding immediately conversion exchange pro rata basis 4 conversion shares amount shares common stock phi group inc alternatively subsidiary phi group inc’s received holder time conversion class series ii preferred stock phi group inc based following formula cs common shares phi group inc amount cs oip aud alternatively subsidiary phi group inc’s vcp oip original issue price class series ii preferred stock phi group inc aud accrued unpaid dividends vcp variable conversion price phi common stock subsidiary phi group inc’s defined c redemption rights corporation period two years date issuance may time redeem class preferred stock either series ii series iii series iv whole part option company’s board directors price equal one hundred twenty percent 120 original purchase price class preferred stock unit consisting shares class preferred stock warrants attached thereto plus case accumulated unpaid dividends date fixed redemption liquidation upon occurrence liquidation event defined holders class preferred stock entitled receive net assets pro rata basis used herein “liquidation event” means liquidation dissolution windingup whether voluntary involuntary corporation ii purchase redemption corporation shares class stock merger consolidation corporation corporations unless holders class preferred stock receive securities surviving corporation substantially similar rights class preferred stock stockholders corporation immediately prior transaction holders least majority voting securities successor corporation immediately thereafter “permitted merger” unless holders shares class preferred stock elect otherwise b sale license lease substantially material part corporation’s assets unless holders class preferred stock elect otherwise e rank shares class preferred stock shall rank senior corporation’s common stock class series capital stock corporation hereafter created ii pari passu class series capital stock corporation hereafter created specifically ranking terms par class preferred stock iii junior class series capital stock corporation hereafter created specifically ranking terms senior class preferred stock case distribution assets upon liquidation dissolution winding corporation whether voluntary involuntary f voting rights 1 class series ii iii iv preferred stock phi group inc shall voting rights g protection provisions long shares class preferred stock outstanding corporation shall without first obtaining majority written consent holders class preferred stock alter change rights preferences privileges class preferred stock affect adversely holders class preferred stock h miscellaneous 1 status redeemed stock case shares class preferred stock shall redeemed otherwise repurchased reacquired shares redeemed repurchased reacquired shall resume status authorized unissued shares preferred stock shall longer designated class preferred stock 2 lost stolen certificates upon receipt corporation evidence loss theft destruction mutilation preferred stock certificates ii case loss theft destruction indemnity bond security reasonably satisfactory corporation case mutilation preferred stock certificates surrendered cancellation corporation shall execute deliver new preferred stock certificates however corporation shall obligated reissue lost stolen destroyed mutilated preferred stock certificates holder class preferred stock contemporaneously requests corporation convert holder’s class preferred stock common stock 3 waiver notwithstanding provision certificate designation contrary provision contained herein right holders class preferred granted hereunder may waived shares class preferred stock holders thereof upon majority written consent holders class preferred stock 4 notices required permitted given terms hereof shall sent certified registered mail return receipt requested delivered personally nationally recognized overnight carrier confirmed facsimile transmission shall effective five 5 days placed mail mailed upon receipt refusal receipt delivered personally nationally recognized overnight carrier confirmed facsimile transmission case addressed party set forth address telephone fax number may designated writing hereafter manner set forth section corporation phi group inc n gould street suite r sheridan wy 82801 facsimile 7024728556 email infophiglobalcom holders class preferred stock address listed corporation’s books records ii class b preferred stock 1 class b series preferred stock designation one million 1000000 shares authorized 500000000 shares preferred stock par value 0001 per share designated class b series preferred stock b number shares number shares class b series preferred stock authorized one million 1000000 shares c dividend none voting rights except provided law shares class b series preferred stock shall right vote act matters holders common stock right vote act holders shares class b series shall entitled notice stockholders’ meeting action matters basis holders common stock holders common stock shares class b series shall vote together act together thereon single class matters provided voting action one share class b series shall entitled one hundred thousand 100000 votes note 12 dissolution nevada corporation operating wyoming corporation june 30 2020 company filed certificate dissolutionwithdrawal nevada secretary state cease corporate registration dissolve phi group inc state nevada certificate dissolutionwithdrawal issued nevada secretary state june 30 2020 filing number 20200754868 company currently maintains corporate registration state wyoming pursuant articles domestication filed wyoming secretary state september 20 2017 operates wyoming corporation company filed form 8k report event securities exchange commission june 30 2020 note 13 stockholder’s equity june 30 2020 total number authorized capital stock company consisted forty billion shares voting common stock par value 0001 per share five hundred million shares preferred stock par value 0001 per share treasury stock balance treasury stock june 30 2020 487767 shares valued 44170 based cost basis common stock fiscal year ended june 30 2020 company issued following amounts common stock june 30 2020 13232408755 shares company’s common stock issued outstanding preferred stock june 30 2020 following amounts preferred stock issued outstanding class series ii preferred stock 10000000 shares class b series preferred stock 180000 shares note 14 stockbased compensation plans february march 18 2015 company adopted employee benefit plan set aside 1000000 shares common stock eligible employees independent contractors company subsidiaries june 30 2020 company issued stock lieu cash plan september 23 2016 company issued incentive stock options nonqualified stock options certain key employees henry fahman ceocfo directors tam bui henry fahman frank hawkins constitute board directors deferred compensation options allow holders acquire company’s common stock fair exercise price company’s common stock grant date option 024 per share based 10days’ volumeweighted average price prior grant date number options equal total 6520000 options terminate seven years date grant become vested exercisable one year grant date following assumptions used monte carlo analysis doty scott enterprises inc independent valuation firm determine fair value stock options vesting based oneyear cliff grant date annual attrition rates used valuation since ongoing employment condition vesting options fair value company’s stock options issuance valuation date follows note 15 income expense net income expense fiscal year ended june 30 2020 consists following note 16 related party transactions company recognized 210000 salaries president secretary company year ended june 30 2020 note 17 income taxes provision made income tax since company significant net operating loss carry forward june 30 2020 company incurred net operating losses tax purposes approximately 44010352 net operating loss carry forward may used reduce taxable income year 2035 net operating loss carry forwards state california generally available reduce taxable income year 2025 availability company’s net operating loss carryforward subject limitation 50 positive change ownership company’s stock “under section 6501a internal revenue code tax code section 3016501a1a income tax regulations tax regulations irs required assess tax within 3 years tax return filed irs” note 18 contracts commitments business consulancy structuring agency agreement set institutional bank funds luxembourg november 30 2017 company signed agreement structuring agent legal experts set bank fund luxembourg order provide financing company’s clients’ projects reserved alternative investment fund raif established form common funds “fcp” investment companies variable capital “sicav” form legal form sicav fcp restriction terms eligible assets raifs free introduce kind assets financial instruments investment policy according luxembourg law july 12 2013 raifs must entrust assets luxembourg custodian bank safekeeping must appoint approved statutory auditor one distinctive advantages raif may various subfunds corresponding distinct part assets liabilities raif subfunds established raif umbrella target different investment opportunities variety industries desired february 21 2018 company signed amendment business consultancy structuring agency agreement solely responsible costs euros 3500000 associated establishing raif october 4 2018 payment agreement signed structuring agent company calling extra amount euros 1500000 paid structuring agent november 15 2018 master luxembourg raif fund named “philux global funds sca sicav raif” registered activated luxembourg commission de surveillance du secteur financier cssf june 11 2020 registration b244952 acquisition 51 equity interest vinafilms joint stock company august 06 2018 signed business cooperation agreement vinafilms jsc công ty cổ phần màng bao bì tân vinh nam phát vietnamese joint stock company principal business address lot g9 road 9 tan industrial zone duc hoa ha village duc hoa district long province vietnam hereinafter referred “vnf” majority shareholder exchange fiftyone percent ownership vnf preferred stock phi according agreement phi responsible filing s1 registration statement securities exchange commission american pacific plastics inc subsidiary phi holds 51 equity ownership vnf become fullyreporting public company us stock market september 20 2018 stock swap agreement signed ms thi nghieu majority shareholder holding 76 ownership vnf phi exchange 3060000 shares ordinary stock vnf owned ms thi nghieu 50 million shares class series iii cumulative convertible redeemable preferred stock phi though transaction technically closed september 28 2018 company recognize operations vinafilms jsc consolidated financial statements june 30 2020 gaap audit vinafilms jsc financial statements conducted completed pcaobregistered auditing firm consulting service agreement glink apps jsc december 23 2019 phi capital holdings inc subsidiary company name changed philux capital advisors inc effective june 03 2020 signed consulting service agreement provide consulting service glink apps jsc wyoming corporation assist latter become publicly traded company us according agreement glink apps jsc pay phi capital holdings inc 88500 cash five million 5000000 shares common stock consulting service rendered business cooperation agreement natural well technical ltd april 27 2020 company signed business cooperation agreement natural well technical ltd “nwtl” company organized existing laws republic china engaged research development innovative biotechnologies may significant applications healthcare beauty supply agriculture industry nwtl company agree jointly cooperate research development activities pertinent technologies initiated continue carried nwtl applying produce commercial products services fields healthcare beauty supply agriculture industry case may well business activities deemed mutually beneficial particular nwtl company initially focus following activities developing implementing comprehensive plan increase production marketing sale “super green” high energy drop drink “mistyrious” fine mist spray products large scale worldwide b developing implementing plan increase production marketing sale “super cassava” “uniwash” engine booster products well products related fields agriculture energy studied developed nwtl c continuing conduct research accumulate clinical data nwtl’s biotechnologies order obtain us fda’s approval cancer treatments healthcare products addition parties also develop produce market beauty supply products designing financial plan providing required funding nwtl execute business plan investment advisory agreement among philux capital advisors inc hauck aufhauser fund services sa philux global funds sca sicavraif june 11 2020 philux capital advisors inc “investment advisor” signed investment advisory agreement among hauck aufhauser fund services sathe “aifm” philux global funds sca sicavraif umbrellafund composed one subfunds “fund” serve investment advisor philux global funds according agreement investment advisor cooperate definition investment strategy implementation advisory capacity develop proposals specific investment policy fund advise support aifm selection investments make investment recommendations carry due diligence process present suitable investments selected consideration investment policy investment restrictions fund provide support conclusion purchase sale transactions observe analyze relevant markets potential investments provide advice support aifm give recommendations event sale investments support investors fund onboarding management granting information fundrelevant issues well channeling answering investor questions support aifm performance risk control completion subscription agreements investment advisor shall receive general partner fund remuneration stated fees annex investment advisory agreement note 19 going concern uncertainty shown accompanying consolidated financial statements company accumulated deficit 44010352 total stockholders’ deficit 7059790 june 30 2020 factors well uncertain conditions company faces daytoday operations respect cash flows create uncertainty company’s ability continue going concern financial statements include adjustments might necessary company unable continue going concern management taken action strengthen company’s working capital position generate sufficient cash meet operating needs june 30 2022 beyond note 20 subsequent events financial statements approved management available issuance june 22 2021 subsequent events evaluated date 1 issuances common stock company july 01 2020 june 22 2021 company issued following amounts stock holders convertible promissory notes shareholders note mr luan ngo lenderinvestor converted total 262500 promissory notes dated 6092008 7082008 7092008 7302008 02052010 amended april 01 2019 plus 94107123 accrued unpaid interest totaling 120357123 614851203 shares common stock rule 144 section 4a1 2 agreements agreement tecco group participation philux infrastructure fund compartment philux global funds august 10 2020 tecco group vietnamese company signed agreement phi luxembourg development sa subsidiary company participate proposed infrastructure fund compartment philux global funds sca sicavraif according agreement tecco group contribute 2000000 49 ownership general partners’ portion said infrastructure fund compartment june 22 2021 tecco group paid four billion vietnam dong vnd towards total agreed amount agreement phat van hung co ltd participation philux real estate fund compartment philux global funds november 09 2020 phat van hung co ltd signed agreement phi luxembourg development sa subsidiary company participate real estate fund compartment philux global funds sca sicavraif according agreement phat van hung co ltd contribute 2000000 49 ownership general partners’ portion said real estate fund compartment june 22 2021 phat van hung made payment towards agreed amount agreement xuan quynh llc participation philux infrastructure fund compartment philux global funds november 20 2020 xuan quynh llc vietnamese company signed agreement phi luxembourg development sa subsidiary company participate proposed infrastructure fund compartment philux global funds sca sicavraif according agreement xuan quynh llc contribute 2000000 49 ownership general partners’ portion said infrastructure fund compartment june 22 2021 xuan quynh llc made payment towards agreed amount investment agreements memorandum understanding august 24 2020 november 11 2020 company luxembourg bank fund mother holding company phi luxembourg development sa philux global funds sca sicavraif signed investment agreements memorandum understanding three nonus entities total investments one billion us dollars however date report company received money investment agreements guarantee money received agreements memorandum understanding future issuance convertible promissory notes march 23 2021 company issued promissory note ema financial llc delaware limited liability company amount 100000 interest rate 6 per annum note mature twelve months issue date may convertible shares common stock company fixed conversion price 0001 per share may prepaid prior 180th calendar day issue date prepayment factor 115 company plans prepay note cash prior 180th calendar day issue date june 7 2021 company issued promissory note ema financial llc delaware limited liability company amount 100000 interest rate 6 per annum note mature twelve months issue date may convertible shares common stock company fixed conversion price 0001 per share may prepaid prior 180th calendar day issue date prepayment factor 115 company plans prepay note cash prior 180th calendar day issue date june 04 2021 company incorporated asia diamond exchange inc wyoming corporation id number 2021001010234 holding company develop asia diamond exchange vietnam item 9 item 15 exhibits financial statements schedules financial statements following consolidated financial statements phi group inc subsidiaries included consolidated balance sheets june 30 2015 2014 consolidated statements operations fiscal years ended june 30 2015 2014 consolidated statements cash flows fiscal years ended june 30 2015 2014 consolidated statements changes owners’ equity fiscal years ended june 30 2015 2014 notes consolidated financial statements report independent registered public accounting firm dave banerjee cpa exhibit description 21 plan exchange company prima eastwest model management inc incorporated reference exhibit 2 form 8k filed march 1 1996 22 corporate combination agreement company providential securities inc effective january 14 2000 incorporated reference exhibit 1012 form 10ksb filed january 10 2000 31 articles incorporation 1 32 amendment articles incorporation incorporated reference exhibit 31 form 10ksb fiscal year ended june 30 1995 33 amendment articles incorporation 6 34 certificate amendment articles incorporation 635 bylaws amended 6 41 form series 1 bridge notes purchase security agreement company investors dated march 27 2000 6 42 form series 1 bridge note executed company issued company investors 6 43 form common stock purchase warrant issued company investors 6 44 form repricing warrant issued company investors 6 45 form registration rights agreement company investors dated march 27 2000 6 46 form common stock purchase warrant issued company sovereign capital advisors llc 6 47 form convertible promissory note issued company preferred shareholders providential securities inc 6 51 opinion validity agreements 6 101 benatone exchange agreement creditors 2 102 benatone share acquisition agreement weldnow enterprise ltd 2 103 benatone share acquisition agreement dynedeem limited 2 104 benatone exchange agreement 2 105 benatone asset sale agreement 2 106 benatone royalty agreement 2 107 benatone consultancy agreement 2 108 benatone deed 2 109 autokraft stock purchase agreement 3 1010 autokraft stock subscription agreement 3 1011 prima agreement plan merger 4 1012 escrow agreement company warshaw burstein cohen schelsinger kuh llp dated march 28 2000 6 1013 placement agency agreement company sovereign capital advisors llc dated march 28 2000 6 1014 guaranty agreement henry fahman sovcap equity partners ltd dated march 28 2000 6 1015 pledge agreement henry fahman sovcap equity partners ltd dated march 28 2000 6 1016 partnership purchase agreement company holt collins dated may 31 2000 6 1017 memorandum agreement datalogic consulting inc phi group inc dated april 25 2001 5 10181 letter intent phi group inc epicenter inc dated october 30 2000 5 10182 amendment letter intent phi group inc epicenter inc dated november 30 2000 5 10183 amendment letter intent phi group inc epicenter inc dated january 12 2001 5 10184 amendment letter intent phi group inc epicenter inc dated june 26 2001 5 10185 amendment letter intent phi group inc epicenter inc dated october 02 2001 5 1019 joint venture agreement providential holdings inc boxo inc dated january 1 2001 5 1020 license manna technologies joint venture company dated march 21 2001 5 1021 memorandum agreement international consulting training center ministry trade vietnam company dated march 24 2001 5 1022 memorandum agreement among general transportation company 5 chu lai industrial zone company dated march 25 2001 5 1023 letter intent phi group inc global systems technologies corp dated october 18 2001 6 1024 letter intent phi group inc estate planning investment company dated november 7 2001 6 1025 joint venture agreement phi group inc mimi ban dated november 23 2001 6 1026 plan acquisition nettel global communication corp incorporated reference company’s current report form 8k filed may 3 2002 1027 joint venture agreement vietnam’s minh hieu joint stock company 7 1028 memorandum agreement hdt enterprises llc dated march 15 2002 7 1029 memorandum agreement principal contract vietnam’s center telecom technology 7 1030 stock purchase agreement slimtech inc incorporated reference company’s current report form 8k filed may 1 2002 1031 stock purchase agreement atc technology corp incorporated reference company’s current report form 8k filed september 17 2002 1032 mutual rescission stock purchase agreement nettel global communication corp 8 1033 business consulting agreement nettel global communication corp 8 1034 business consulting agreement medical career college 8 1035 mutual rescission stock purchase agreement slimtech 8 1036 mutual rescission stock purchase agreement clear pass inc 8 1037 mutual rescission joint venture agreement htv co ltd 8 1038 mutual rescission stock purchase agreement real id technology 8 1039 business consulting agreement lexor incorporated 8 1040 amended closing memorandum atc technology corp 8 1041 stock purchase agreement tangshan yutiansaw corporation incorporated reference company’s current report form 8k filed june 15 2004 1042 asset purchase agreement western medical inc incorporated reference company’s current report form 8k file june 2 2006 1043 principle business cooperation agreement cavico vietnam joint stock corporation incorporated reference company’s current report form 8k filed october 2 2006 161 notification change accountants kabani co appointed incorporated reference exhibits filed form 8ka filed september 10 2001 171 resignation nhi le director officer appointment thorman hwinn director incorporated reference exhibits filed form 8k filed july 9 2001 172 resignation tam bui director incorporated reference company’s current report form 8k filed september 30 2004 173 resignation gene bennett chief financial officer incorporated reference company’s current report form 8k filed march 23 2005 174 resignation robert stevenson director incorporated reference company’s current report form 8k filed july 18 2006 175 resignation ghanshyam dass director incorporated reference company’s current report form 8k filed september 29 2010 176 resignation paul nguyen director incorporated reference company’s annual report fiscal year ended june 30 2012 filed securities exchange commission june 2 2014 211 subsidiary registrant 311322 certifications accordance sections 302 906 sarbanesoxley act 2002 101ins xbrl instance document 101sch xbrl taxonomy extension schema document 101cal xbrl taxonomy extension calculation linkbase document 101def xbrl taxonomy extension definition linkbase document 101lab xbrl taxonomy extension label linkbase document 101pre xbrl taxonomy extension presentation linkbase document 1 incorporated reference company’s registration statement form s18 declared effective august 10 1982 sec file 278335ny company’s annual report form 10k fiscal year ended june 30 1995 2 incorporated reference company’s current report form 8k dated september 7 1995 3 incorporated reference company’s current report form 8ka dated september 12 1995 4 incorporated reference company’s current report form 8k dated march 1 1996 5 incorporated reference form 10ksb year ended june 30 2000 filed october 16 2001 6 incorporated reference form 10ksb year ended june 30 2001 filed december 17 2001 7 incorporated reference form 10qsb quarter ended march 31 2002 filed may 14 2002 8 incorporated reference form 10ksb year ended june 30 2003 filed october 17 2003 signatures pursuant requirement section 12 securities exchange act 1934 registrant duly caused registration statement signed behalf undersigned thereunto duly authorized accordance exchange act 1934 report signed following persons behalf company capacities dates indicated signature title date henry fahman chairmanpresidentacting chief financial officer october 1 2015 henry fahman tina phan treasurer october 1 2015 tina phan tam bui director october 1 2015 tam bui frank hawkins director october 1 2015 frank hawkins item 15 exhibits financial statements schedules financial statements following consolidated financial statements providential holdings inc subsidiaries included signatures pursuant requirement section 12 securities exchange act 1934 registrant duly caused registration statement signed behalf undersigned thereunto duly authorized providential holdings inc date october 14 2008 henry fahman henry fahman president accordance exchange act 1934 report signed following persons behalf company capacities dates indicated item 15 exhibits financial statements schedules financial statements following consolidated financial statements phi group inc subsidiaries included consolidated balance sheets june 30 2010 2009 consolidated statements operations fiscal years ended june 30 2010 2009 consolidated statements cash flows fiscal years ended june 30 2010 2009 consolidated statements changes owners’ equity fiscal years ended june 30 2010 2009 notes consolidated financial statements report independent registered public accounting firm kabani company exhibit description 21 plan exchange company prima eastwest model management inc incorporated reference exhibit 2 form 8k filed march 1 1996 22 corporate combination agreement company providential securities inc effective january 14 2000 incorporated reference exhibit 1012 form 10ksb filed january 10 2000 31 articles incorporation 1 32 amendment articles incorporation incorporated reference exhibit 31 form 10ksb fiscal year ended june 30 1995 33 amendment articles incorporation 6 34 certificate amendment articles incorporation 635 bylaws amended 6 41 form series 1 bridge notes purchase security agreement company investors dated march 27 2000 6 42 form series 1 bridge note executed company issued company investors 6 43 form common stock purchase warrant issued company investors 6 44 form repricing warrant issued company investors 6 45 form registration rights agreement company investors dated march 27 2000 6 46 form common stock purchase warrant issued company sovereign capital advisors llc 6 47 form convertible promissory note issued company preferred shareholders providential securities inc 6 51 opinion validity agreements 6 101 benatone exchange agreement creditors 2 102 benatone share acquisition agreement weldnow enterprise ltd 2 103 benatone share acquisition agreement dynedeem limited 2 104 benatone exchange agreement 2 105 benatone asset sale agreement 2 106 benatone royalty agreement 2 107 benatone consultancy agreement 2 108 benatone deed 2 109 autokraft stock purchase agreement 3 1010 autokraft stock subscription agreement 3 1011 prima agreement plan merger 4 1012 escrow agreement company warshaw burstein cohen schelsinger kuh llp dated march 28 2000 6 1013 placement agency agreement company sovereign capital advisors llc dated march 28 2000 6 1014 guaranty agreement henry fahman sovcap equity partners ltd dated march 28 2000 6 1015 pledge agreement henry fahman sovcap equity partners ltd dated march 28 2000 6 1016 partnership purchase agreement company holt collins dated may 31 2000 6 1017 memorandum agreement datalogic consulting inc phi group inc dated april 25 2001 5 10181 letter intent phi group inc epicenter inc dated october 30 2000 5 10182 amendment letter intent phi group inc epicenter inc dated november 30 2000 5 10183 amendment letter intent phi group inc epicenter inc dated january 12 2001 5 10184 amendment letter intent phi group inc epicenter inc dated june 26 2001 5 10185 amendment letter intent phi group inc epicenter inc dated october 02 2001 5 1019 joint venture agreement providential holdings inc boxo inc dated january 1 2001 5 1020 license manna technologies joint venture company dated march 21 2001 5 1021 memorandum agreement international consulting training center ministry trade vietnam company dated march 24 2001 5 1022 memorandum agreement among general transportation company 5 chu lai industrial zone company dated march 25 2001 5 1023 letter intent phi group inc global systems technologies corp dated october 18 2001 6 1024 letter intent phi group inc estate planning investment company dated november 7 2001 6 1025 joint venture agreement phi group inc mimi ban dated november 23 2001 6 1026 plan acquisition nettel global communication corp incorporated reference companys current report form 8k filed may 3 2002 1027 joint venture agreement vietnams minh hieu joint stock company 7 1028 memorandum agreement hdt enterprises llc dated march 15 2002 7 1029 memorandum agreement principle contract vietnams center telecom technology 7 1030 stock purchase agreement slimtech inc incorporated reference companys current report form 8k filed may 1 2002 1031 stock purchase agreement atc technology corp incorporated reference companys current report form 8k filed september 17 2002 1032 mutual rescission stock purchase agreement nettel global communication corp 8 1033 business consulting agreement nettel global communication corp 8 1034 business consulting agreement medical career college 8 1035 mutual rescission stock purchase agreement slimtech 8 1036 mutual rescission stock purchase agreement clear pass inc 8 1037 mutual rescission joint venture agreement htv co ltd 8 1038 mutual rescission stock purchase agreement real id technology 8 1039 business consulting agreement lexor incorporated 8 1040 amended closing memorandum atc technology corp 8 1041 stock purchase agreement tangshan yutiansaw corporation incorporated reference companys current report form 8k filed june 15 2004 1042 asset purchase agreement western medical inc incorporated reference companys current report form 8k file june 2 2006 1043 principle business cooperation agreement cavico vietnam joint stock corporation incorporated reference companys current report form 8k filed october 2 2006 161 notification change accountants kabani co appointed incorporated reference exhibits filed form 8ka filed september 10 2001 171 resignation nhi le director officer appointment thorman hwinn director incorporated reference exhibits filed form 8k filed july 9 2001 172 resignation tam bui director incorporated reference companys current report form 8k filed september 30 2004 173 resignation gene bennett chief financial officer incorporated reference companys current report form 8k filed march 23 2005 174 resignation robert stevenson director incorporated reference companys current report form 8k filed july 18 2006 175 resignation ghanshyam dass director incorporated reference company’s current report form 8k filed september 29 2010 211 subsidiaries registrant 321322 certifications accordance sections 302 906 sarbanesoxley act 2002 1 incorporated reference companys registration statement form s18 declared effective august 10 1982 sec file 278335ny companys annual report form 10k fiscal year ended june 30 1995 2 incorporated reference companys current report form 8k dated september 7 1995 3 incorporated reference companys current report form 8ka dated september 12 1995 4 incorporated reference companys current report form 8k dated march 1 1996 5 incorporated reference form 10ksb year ended june 30 2000 filed october 16 2001 6 incorporated reference form 10ksb year ended june 30 2001 filed december 17 2001 7 incorporated reference form 10qsb quarter ended march 31 2002 filed may 14 2002 8 incorporated reference form 10ksb year ended june 30 2003 filed october 17 2003 signatures pursuant requirement section 12 securities exchange act 1934 registrant duly caused registration statement signed behalf undersigned thereunto duly authorized phi group inc date october 08 2010 henry fahman henry fahman president accordance exchange act 1934 report signed following persons behalf company capacities dates indicated signature title date henry fahman henry fahman chairmanpresidentacting chief financial officer october 08 2010 tina phan treasurer october 08 2010 tina phan tam bui director october 08 2010 tam bui sfrank hawkins director october 08 2010 frank hawkins spaul k nguyen director october 08 2010 paul k nguyen lawrence g olson director october 08 2010 lawrence g olson item 15 exhibits financial statements schedules financial statements following consolidated financial statements phi group inc subsidiaries included consolidated balance sheets june 30 2018 2017 consolidated statements operations fiscal years ended june 30 2018 2017 consolidated statements cash flows fiscal years ended june 30 2018 2017 consolidated statements changes owners’ equity fiscal years ended june 30 2018 2017 notes consolidated financial statements report independent registered public accounting firm dylanfloyd accounting consulting exhibit description 21 plan exchange company prima eastwest model management inc incorporated reference exhibit 2 form 8k filed march 1 1996 22 corporate combination agreement company providential securities inc effective january 14 2000 incorporated reference exhibit 1012 form 10ksb filed january 10 2000 31 articles incorporation 1 32 amendment articles incorporation incorporated reference exhibit 31 form 10ksb fiscal year ended june 30 1995 33 amendment articles incorporation 6 34 certificate amendment articles incorporation 635 bylaws amended 6 41 form series 1 bridge notes purchase security agreement company investorsdated march 27 2000 6 42 form series 1 bridge note executed company issued company investors 6 43 form common stock purchase warrant issued company investors 6 44 form repricing warrant issued company investors 6 45 form registration rights agreement company investors dated march 27 2000 6 46 form common stock purchase warrant issued company sovereign capital advisors llc 6 47 form convertible promissory note issued company preferred shareholders providential securities inc 6 51 opinion validity agreements 6 101 benatone exchange agreement creditors 2 102 benatone share acquisition agreement weldnow enterprise ltd 2 103 benatone share acquisition agreement dynedeem limited 2 104 benatone exchange agreement 2 105 benatone asset sale agreement 2 106 benatone royalty agreement 2 107 benatone consultancy agreement 2 108 benatone deed 2 109 autokraft stock purchase agreement 3 1010 autokraft stock subscription agreement 3 1011 prima agreement plan merger 4 1012 escrow agreement company warshaw burstein cohen schelsinger kuh llp dated march 28 2000 6 1013 placement agency agreement company sovereign capital advisors llc dated march 28 2000 6 1014 guaranty agreement henry fahman sovcap equity partners ltd dated march 28 2000 6 1015 pledge agreement henry fahman sovcap equity partners ltd dated march 28 2000 6 1016 partnership purchase agreement company holt collins dated may 31 2000 6 1017 memorandum agreement datalogic consulting inc phi group inc dated april 252001 5 10181 letter intent phi group inc epicenter inc dated october 30 2000 5 10182 amendment letter intent phi group inc epicenter inc dated november 30 2000 5 10183 amendment letter intent phi group inc epicenter inc dated january 12 2001 5 10184 amendment letter intent phi group inc epicenter inc dated june 26 2001 5 10185 amendment letter intent phi group inc epicenter inc dated october 02 2001 5 1019 joint venture agreement providential holdings inc boxo inc dated january 1 2001 5 1020 license manna technologies joint venture company dated march 21 2001 5 1021 memorandum agreement international consulting training center ministry tradevietnam company dated march 24 2001 5 1022 memorandum agreement among general transportation company 5 chu lai industrial zone company dated march 25 2001 5 1023 letter intent phi group inc global systems technologies corp dated october 18 2001 6 1024 letter intent phi group inc estate planning investment company dated november 7 2001 6 1025 joint venture agreement phi group inc mimi ban dated november 23 2001 6 1026 plan acquisition nettel global communication corp incorporated reference company’s current report form 8k filed may 3 2002 1027 joint venture agreement vietnam’s minh hieu joint stock company 7 1028 memorandum agreement hdt enterprises llc dated march 15 2002 7 1029 memorandum agreement principal contract vietnam’s center telecom technology 7 1030 stock purchase agreement slimtech inc incorporated reference company’s current report form 8k filed may 1 2002 1031 stock purchase agreement atc technology corp incorporated reference company’s current report form 8k filed september 17 2002 1032 mutual rescission stock purchase agreement nettel global communication corp 8 1033 business consulting agreement nettel global communication corp 8 1034 business consulting agreement medical career college 8 1035 mutual rescission stock purchase agreement slimtech 8 1036 mutual rescission stock purchase agreement clear pass inc 8 1037 mutual rescission joint venture agreement htv co ltd 8 1038 mutual rescission stock purchase agreement real id technology 8 1039 business consulting agreement lexor incorporated 8 1040 amended closing memorandum atc technology corp 8 1041 stock purchase agreement tangshan yutiansaw corporation incorporated reference company’s current report form 8k filed june 15 2004 1042 asset purchase agreement western medical inc incorporated reference company’s current report form 8k file june 2 2006 1043 principle business cooperation agreement cavico vietnam joint stock corporation incorporated reference company’s current report form 8k filed october 2 2006 161 notification change accountants kabani co appointed incorporated reference exhibits filed form 8ka filed september 10 2001 171 resignation nhi le director officer appointment thorman hwinn director incorporated reference exhibits filed form 8k filed july 9 2001 172 resignation tam bui director incorporated reference company’s current report form 8k filed september 30 2004 173 resignation gene bennett chief financial officer incorporated reference company’s current report form 8k filed march 23 2005 174 resignation robert stevenson director incorporated reference company’s current report form 8k filed july 18 2006 175 resignation ghanshyam dass director incorporated reference company’s current report form 8k filed september 29 2010 176 resignation paul nguyen director incorporated reference company’s annual report fiscal year ended june 30 2012 filed securities exchange commission june 2 2014 177 unregistered sale equity securities incorporated reference company’s current report form 8k filed december 23 2016 178 unregistered sale equity securities incorporated reference company’s current report form 8k filed december 29 2016 179 investment agreement azure capital incorporated reference company’s current report form 8k filed march 7 2017 1710 unregistered sale equity securities incorporated reference company’s current report form 8k filed april 10 2017 1711 private stock purchase sale agreement maxagro farm srl incorporated reference company’s current report form 8k filed june 1 2017 1712 contract transfer shares” purchase 51 equity ownership constructii sa incorporated reference company’s current report form 8k filed june 30 2017 1713 unregistered sale equity securities incorporated reference company’s current report form 8k filed july 27 2017 1714 amendment private stock purchase sale agreement maxagro farm srl incorporated reference company’s current report form 8k filed august 9 2017 1715 agreement purchase sale rush gold royalty inc wyoming corporation acquire 51 ownership twentyone mining claims area approximately 400 acres granite mining district grant county oregon usa incorporated reference company’s current report form 8k filed september 7 2017 1716 registration statements connection azure capital investment agreement incorporated reference company’s s1 registration statement filed april 3 2017 withdrawal registration statement filed august 7 2017 new s1 registration statement filed august 7 2017 s1a filed september 15 2017 1717 closing memorandum agreement purchase sale rush gold royalty inc wyoming corporation acquire 51 ownership twentyone mining claims area approximately 400 acres granite mining district grant county oregon usa incorporated reference company’s current report form 8k filed october 9 2017 211 subsidiary registrant 311322 certifications accordance sections 302 906 sarbanesoxley act 2002 101ins xbrl instance document 101sch xbrl taxonomy extension schema document 101cal xbrl taxonomy extension calculation linkbase document 101def xbrl taxonomy extension definition linkbase document 101lab xbrl taxonomy extension label linkbase document 101pre xbrl taxonomy extension presentation linkbase document 1 incorporated reference company’s registration statement form s18 declared effective august 10 1982 sec file 278335ny company’s annual report form 10k fiscal year ended june 30 1995 2 incorporated reference company’s current report form 8k dated september 7 1995 3 incorporated reference company’s current report form 8ka dated september 12 1995 4 incorporated reference company’s current report form 8k dated march 1 1996 5 incorporated reference form 10ksb year ended june 30 2000 filed october 16 2001 6 incorporated reference form 10ksb year ended june 30 2001 filed december 17 2001 7 incorporated reference form 10qsb quarter ended march 31 2002 filed may 14 2002 8 incorporated reference form 10ksb year ended june 30 2003 filed october 17 2003 signatures pursuant requirement section 12 securities exchange act 1934 registrant duly caused registration statement signed behalf undersigned thereunto duly authorized accordance exchange act 1934 report signed following persons behalf company capacities dates indicated signature title date henry fahman henry fahman chairmanpresidentacting chief financial officer october 15 2018 tina phan secretarytreasurer october 15 2018 tina phan tam bui director october 15 2018 tam bui frank hawkins director october 15 2018 frank hawkins item 15 exhibits financial statements schedules financial statements following consolidated financial statements phi group inc subsidiaries included consolidated balance sheets june 30 2014 2013 consolidated statements operations fiscal years ended june 30 2014 2013 consolidated statements cash flows fiscal years ended june 30 2014 2013 consolidated statements changes owners’ equity fiscal years ended june 30 2014 2013 notes consolidated financial statements report independent registered public accounting firm dave banerjee cpa exhibit description 21 plan exchange company prima eastwest model management inc incorporated reference exhibit 2 form 8k filed march 1 1996 22 corporate combination agreement company providential securities inc effective january 14 2000 incorporated reference exhibit 1012 form 10ksb filed january 10 2000 31 articles incorporation 1 32 amendment articles incorporation incorporated reference exhibit 31 form 10ksb fiscal year ended june 30 1995 33 amendment articles incorporation 6 34 certificate amendment articles incorporation 635 bylaws amended 6 41 form series 1 bridge notes purchase security agreement company investors dated march 27 2000 6 42 form series 1 bridge note executed company issued company investors 6 43 form common stock purchase warrant issued company investors 6 44 form repricing warrant issued company investors 6 45 form registration rights agreement company investors dated march 27 2000 6 46 form common stock purchase warrant issued company sovereign capital advisors llc 6 47 form convertible promissory note issued company preferred shareholders providential securities inc 6 51 opinion validity agreements 6 101 benatone exchange agreement creditors 2 102 benatone share acquisition agreement weldnow enterprise ltd 2 103 benatone share acquisition agreement dynedeem limited 2 104 benatone exchange agreement 2 105 benatone asset sale agreement 2 106 benatone royalty agreement 2 107 benatone consultancy agreement 2 108 benatone deed 2 109 autokraft stock purchase agreement 3 1010 autokraft stock subscription agreement 3 1011 prima agreement plan merger 4 1012 escrow agreement company warshaw burstein cohen schelsinger kuh llp dated march 28 2000 6 1013 placement agency agreement company sovereign capital advisors llc dated march 28 2000 6 1014 guaranty agreement henry fahman sovcap equity partners ltd dated march 28 2000 6 1015 pledge agreement henry fahman sovcap equity partners ltd dated march 28 2000 6 1016 partnership purchase agreement company holt collins dated may 31 2000 6 1017 memorandum agreement datalogic consulting inc phi group inc dated april 25 2001 5 10181 letter intent phi group inc epicenter inc dated october 30 2000 5 10182 amendment letter intent phi group inc epicenter inc dated november 30 2000 5 10183 amendment letter intent phi group inc epicenter inc dated january 12 2001 5 10184 amendment letter intent phi group inc epicenter inc dated june 26 2001 5 10185 amendment letter intent phi group inc epicenter inc dated october 02 2001 5 1019 joint venture agreement providential holdings inc boxo inc dated january 1 2001 5 1020 license manna technologies joint venture company dated march 21 2001 5 1021 memorandum agreement international consulting training center ministry trade vietnam company dated march 24 2001 5 1022 memorandum agreement among general transportation company 5 chu lai industrial zone company dated march 25 2001 5 1023 letter intent phi group inc global systems technologies corp dated october 18 2001 6 1024 letter intent phi group inc estate planning investment company dated november 7 2001 6 1025 joint venture agreement phi group inc mimi ban dated november 23 2001 6 1026 plan acquisition nettel global communication corp incorporated reference company’s current report form 8k filed may 3 2002 1027 joint venture agreement vietnam’s minh hieu joint stock company 7 1028 memorandum agreement hdt enterprises llc dated march 15 2002 7 1029 memorandum agreement principal contract vietnam’s center telecom technology 7 1030 stock purchase agreement slimtech inc incorporated reference company’s current report form 8k filed may 1 2002 1031 stock purchase agreement atc technology corp incorporated reference company’s current report form 8k filed september 17 2002 1032 mutual rescission stock purchase agreement nettel global communication corp 8 1033 business consulting agreement nettel global communication corp 8 1034 business consulting agreement medical career college 8 1035 mutual rescission stock purchase agreement slimtech 8 1036 mutual rescission stock purchase agreement clear pass inc 8 1037 mutual rescission joint venture agreement htv co ltd 8 1038 mutual rescission stock purchase agreement real id technology 8 1039 business consulting agreement lexor incorporated 8 1040 amended closing memorandum atc technology corp 8 1041 stock purchase agreement tangshan yutiansaw corporation incorporated reference company’s current report form 8k filed june 15 2004 1042 asset purchase agreement western medical inc incorporated reference company’s current report form 8k file june 2 2006 1043 principle business cooperation agreement cavico vietnam joint stock corporation incorporated reference company’s current report form 8k filed october 2 2006 161 notification change accountants kabani co appointed incorporated reference exhibits filed form 8ka filed september 10 2001 171 resignation nhi le director officer appointment thorman hwinn director incorporated reference exhibits filed form 8k filed july 9 2001 172 resignation tam bui director incorporated reference company’s current report form 8k filed september 30 2004 173 resignation gene bennett chief financial officer incorporated reference company’s current report form 8k filed march 23 2005 174 resignation robert stevenson director incorporated reference company’s current report form 8k filed july 18 2006 175 resignation ghanshyam dass director incorporated reference company’s current report form 8k filed september 29 2010 176 resignation paul nguyen director incorporated reference company’s annual report fiscal year ended june 30 2012 filed securities exchange commission june 2 2014 211 subsidiary registrant 311322 certifications accordance sections 302 906 sarbanesoxley act 2002 101ins xbrl instance document 101sch xbrl taxonomy extension schema document 101cal xbrl taxonomy extension calculation linkbase document 101def xbrl taxonomy extension definition linkbase document 101lab xbrl taxonomy extension label linkbase document 101pre xbrl taxonomy extension presentation linkbase document 1 incorporated reference company’s registration statement form s18 declared effective august 10 1982 sec file 278335ny company’s annual report form 10k fiscal year ended june 30 1995 2 incorporated reference company’s current report form 8k dated september 7 1995 3 incorporated reference company’s current report form 8ka dated september 12 1995 4 incorporated reference company’s current report form 8k dated march 1 1996 5 incorporated reference form 10ksb year ended june 30 2000 filed october 16 2001 6 incorporated reference form 10ksb year ended june 30 2001 filed december 17 2001 7 incorporated reference form 10qsb quarter ended march 31 2002 filed may 14 2002 8 incorporated reference form 10ksb year ended june 30 2003 filed october 17 2003 signatures pursuant requirement section 12 securities exchange act 1934 registrant duly caused registration statement signed behalf undersigned thereunto duly authorized phi group inc dated december 30 2014 henry fahman henry fahman president accordance exchange act 1934 report signed following persons behalf company capacities dates indicated signature title date henry fahman chairmanpresidentacting chief financial officer december 30 2014 henry fahman tina phan treasurer december 30 2014 tina phan tam bui director december 30 2014 tam bui sfrank hawkins director december 30 2014 frank hawkins item 15 exhibits financial statements schedules financial statements following consolidated financial statements phi group inc subsidiaries included consolidated balance sheets june 30 2016 2015 consolidated statements operations fiscal years ended june 30 2016 2015 consolidated statements cash flows fiscal years ended june 30 2016 2015 consolidated statements changes owners’ equity fiscal years ended june 30 2016 2015 notes consolidated financial statements report independent registered public accounting firm dave banerjee cpa exhibit description 21 plan exchange company prima eastwest model management inc incorporated reference exhibit 2 form 8k filed march 1 1996 22 corporate combination agreement company providential securities inc effective january 14 2000 incorporated reference exhibit 1012 form 10ksb filed january 10 2000 31 articles incorporation 1 32 amendment articles incorporation incorporated reference exhibit 31 form 10ksb fiscal year ended june 30 1995 33 amendment articles incorporation 6 34 certificate amendment articles incorporation 635 bylaws amended 6 41 form series 1 bridge notes purchase security agreement company investors dated march 27 2000 6 42 form series 1 bridge note executed company issued company investors 6 43 form common stock purchase warrant issued company investors 6 44 form repricing warrant issued company investors 6 45 form registration rights agreement company investors dated march 27 2000 6 46 form common stock purchase warrant issued company sovereign capital advisors llc 6 47 form convertible promissory note issued company preferred shareholders providential securities inc 6 51 opinion validity agreements 6 101 benatone exchange agreement creditors 2 102 benatone share acquisition agreement weldnow enterprise ltd 2 103 benatone share acquisition agreement dynedeem limited 2 104 benatone exchange agreement 2 105 benatone asset sale agreement 2 106 benatone royalty agreement 2 107 benatone consultancy agreement 2 108 benatone deed 2 109 autokraft stock purchase agreement 3 1010 autokraft stock subscription agreement 3 1011 prima agreement plan merger 4 1012 escrow agreement company warshaw burstein cohen schelsinger kuh llp dated march 28 2000 6 1013 placement agency agreement company sovereign capital advisors llc dated march 28 2000 6 1014 guaranty agreement henry fahman sovcap equity partners ltd dated march 28 2000 6 1015 pledge agreement henry fahman sovcap equity partners ltd dated march 28 2000 6 1016 partnership purchase agreement company holt collins dated may 31 2000 6 1017 memorandum agreement datalogic consulting inc phi group inc dated april 25 2001 5 10181 letter intent phi group inc epicenter inc dated october 30 2000 5 10182 amendment letter intent phi group inc epicenter inc dated november 30 2000 5 10183 amendment letter intent phi group inc epicenter inc dated january 12 2001 5 10184 amendment letter intent phi group inc epicenter inc dated june 26 2001 5 10185 amendment letter intent phi group inc epicenter inc dated october 02 2001 5 1019 joint venture agreement providential holdings inc boxo inc dated january 1 2001 5 1020 license manna technologies joint venture company dated march 21 2001 5 1021 memorandum agreement international consulting training center ministry trade vietnam company dated march 24 2001 5 1022 memorandum agreement among general transportation company 5 chu lai industrial zone company dated march 25 2001 5 1023 letter intent phi group inc global systems technologies corp dated october 18 2001 6 1024 letter intent phi group inc estate planning investment company dated november 7 2001 6 1025 joint venture agreement phi group inc mimi ban dated november 23 2001 6 1026 plan acquisition nettel global communication corp incorporated reference company’s current report form 8k filed may 3 2002 1027 joint venture agreement vietnam’s minh hieu joint stock company 7 1028 memorandum agreement hdt enterprises llc dated march 15 2002 7 1029 memorandum agreement principal contract vietnam’s center telecom technology 7 1030 stock purchase agreement slimtech inc incorporated reference company’s current report form 8k filed may 1 2002 1031 stock purchase agreement atc technology corp incorporated reference company’s current report form 8k filed september 17 2002 1032 mutual rescission stock purchase agreement nettel global communication corp 8 1033 business consulting agreement nettel global communication corp 8 1034 business consulting agreement medical career college 8 1035 mutual rescission stock purchase agreement slimtech 8 1036 mutual rescission stock purchase agreement clear pass inc 8 1037 mutual rescission joint venture agreement htv co ltd 8 1038 mutual rescission stock purchase agreement real id technology 8 1039 business consulting agreement lexor incorporated 8 1040 amended closing memorandum atc technology corp 8 1041 stock purchase agreement tangshan yutiansaw corporation incorporated reference company’s current report form 8k filed june 15 2004 1042 asset purchase agreement western medical inc incorporated reference company’s current report form 8k file june 2 2006 1043 principle business cooperation agreement cavico vietnam joint stock corporation incorporated reference company’s current report form 8k filed october 2 2006 161 notification change accountants kabani co appointed incorporated reference exhibits filed form 8ka filed september 10 2001 171 resignation nhi le director officer appointment thorman hwinn director incorporated reference exhibits filed form 8k filed july 9 2001 172 resignation tam bui director incorporated reference company’s current report form 8k filed september 30 2004 173 resignation gene bennett chief financial officer incorporated reference company’s current report form 8k filed march 23 2005 174 resignation robert stevenson director incorporated reference company’s current report form 8k filed july 18 2006 175 resignation ghanshyam dass director incorporated reference company’s current report form 8k filed september 29 2010 176 resignation paul nguyen director incorporated reference company’s annual report fiscal year ended june 30 2012 filed securities exchange commission june 2 2014 211 subsidiary registrant 311322 certifications accordance sections 302 906 sarbanesoxley act 2002 101ins xbrl instance document 101sch xbrl taxonomy extension schema document 101cal xbrl taxonomy extension calculation linkbase document 101def xbrl taxonomy extension definition linkbase document 101lab xbrl taxonomy extension label linkbase document 101pre xbrl taxonomy extension presentation linkbase document 1 incorporated reference company’s registration statement form s18 declared effective august 10 1982 sec file 278335ny company’s annual report form 10k fiscal year ended june 30 1995 2 incorporated reference company’s current report form 8k dated september 7 1995 3 incorporated reference company’s current report form 8ka dated september 12 1995 4 incorporated reference company’s current report form 8k dated march 1 1996 5 incorporated reference form 10ksb year ended june 30 2000 filed october 16 2001 6 incorporated reference form 10ksb year ended june 30 2001 filed december 17 2001 7 incorporated reference form 10qsb quarter ended march 31 2002 filed may 14 2002 8 incorporated reference form 10ksb year ended june 30 2003 filed october 17 2003 signatures pursuant requirement section 12 securities exchange act 1934 registrant duly caused registration statement signed behalf undersigned thereunto duly authorized accordance exchange act 1934 report signed following persons behalf company capacities dates indicated signature title date henry fahman henry fahman chairmanpresidentacting chief financial officer october 13 2016 tina phan treasurer october 13 2016 tina phan tam bui director october 13 2016 tam bui frank hawkins director october 13 2016 frank hawkins item 15 exhibits financial statements schedules financial statements following consolidated financial statements phi group inc subsidiaries included consolidated balance sheets june 30 2019 2018 consolidated statements operations fiscal years ended june 30 2019 2018 consolidated statements cash flows fiscal years ended june 30 2019 2018 consolidated statements changes owners’ equity fiscal years ended june 30 2019 2018 notes consolidated financial statements report independent registered public accounting firm ms madhava rao exhibit index exhibit description 21 plan exchange company prima eastwest model management inc incorporated reference exhibit 2 form 8k filed march 1 1996 22 corporate combination agreement company providential securities inc effective january 14 2000 incorporated reference exhibit 1012 form 10ksb filed january 10 2000 31 articles incorporation 1 32 amendment articles incorporation incorporated reference exhibit 31 form 10ksb fiscal year ended june 30 1995 33 amendment articles incorporation 6 34 certificate amendment articles incorporation 6 35 bylaws amended 6 41 form series 1 bridge notes purchase security agreement company investors dated march 27 2000 6 42 form series 1 bridge note executed company issued company investors 6 43 form common stock purchase warrant issued company investors 6 44 form repricing warrant issued company investors 6 45 form registration rights agreement company investors dated march 27 2000 6 46 form common stock purchase warrant issued company sovereign capital advisors llc 6 47 form convertible promissory note issued company preferred shareholders providential securities inc 6 51 opinion validity agreements 6 101 benatone exchange agreement creditors 2 102 benatone share acquisition agreement weldnow enterprise ltd 2 103 benatone share acquisition agreement dynedeem limited 2 104 benatone exchange agreement 2 105 benatone asset sale agreement 2 106 benatone royalty agreement 2 107 benatone consultancy agreement 2 108 benatone deed 2 109 autokraft stock purchase agreement 3 1010 autokraft stock subscription agreement 3 1011 prima agreement plan merger 4 1012 escrow agreement company warshaw burstein cohen schelsinger kuh llp dated march 28 2000 6 1013 placement agency agreement company sovereign capital advisors llc dated march 28 2000 6 1014 guaranty agreement henry fahman sovcap equity partners ltd dated march 28 2000 6 1015 pledge agreement henry fahman sovcap equity partners ltd dated march 28 2000 6 1016 partnership purchase agreement company holt collins dated may 31 2000 6 1017 memorandum agreement datalogic consulting inc phi group inc dated april 25 2001 5 10181 letter intent phi group inc epicenter inc dated october 30 2000 5 10182 amendment letter intent phi group inc epicenter inc dated november 30 2000 5 10183 amendment letter intent phi group inc epicenter inc dated january 12 2001 5 10184 amendment letter intent phi group inc epicenter inc dated june 26 2001 5 10185 amendment letter intent phi group inc epicenter inc dated october 02 2001 5 1019 joint venture agreement providential holdings inc boxo inc dated january 1 2001 5 1020 license manna technologies joint venture company dated march 21 2001 5 1021 memorandum agreement international consulting training center ministry trade vietnam company dated march 24 2001 5 1022 memorandum agreement among general transportation company 5 chu lai industrial zone company dated march 25 2001 5 1023 letter intent phi group inc global systems technologies corp dated october 18 2001 6 1024 letter intent phi group inc estate planning investment company dated november 7 2001 6 1025 joint venture agreement phi group inc mimi ban dated november 23 2001 6 1026 plan acquisition nettel global communication corp incorporated reference company’s current report form 8k filed may 3 2002 1027 joint venture agreement vietnam’s minh hieu joint stock company 7 1028 memorandum agreement hdt enterprises llc dated march 15 2002 7 1029 memorandum agreement principal contract vietnam’s center telecom technology 7 1030 stock purchase agreement slimtech inc incorporated reference company’s current report form 8k filed may 1 2002 1031 stock purchase agreement atc technology corp incorporated reference company’s current report form 8k filed september 17 2002 1032 mutual rescission stock purchase agreement nettel global communication corp 8 1033 business consulting agreement nettel global communication corp 8 1034 business consulting agreement medical career college 8 1035 mutual rescission stock purchase agreement slimtech 8 1036 mutual rescission stock purchase agreement clear pass inc 8 1037 mutual rescission joint venture agreement htv co ltd 8 1038 mutual rescission stock purchase agreement real id technology 8 1039 business consulting agreement lexor incorporated 8 1040 amended closing memorandum atc technology corp 8 1041 stock purchase agreement tangshan yutiansaw corporation incorporated reference company’s current report form 8k filed june 15 2004 1042 asset purchase agreement western medical inc incorporated reference company’s current report form 8k file june 2 2006 1043 principle business cooperation agreement cavico vietnam joint stock corporation incorporated reference company’s current report form 8k filed october 2 2006 161 notification change accountants kabani co appointed incorporated reference exhibits filed form 8ka filed september 10 2001 171 resignation nhi le director officer appointment thorman hwinn director incorporated reference exhibits filed form 8k filed july 9 2001 172 resignation tam bui director incorporated reference company’s current report form 8k filed september 30 2004 173 resignation gene bennett chief financial officer incorporated reference company’s current report form 8k filed march 23 2005 174 resignation robert stevenson director incorporated reference company’s current report form 8k filed july 18 2006 175 resignation ghanshyam dass director incorporated reference company’s current report form 8k filed september 29 2010 176 resignation paul nguyen director incorporated reference company’s annual report fiscal year ended june 30 2012 filed securities exchange commission june 2 2014 177 unregistered sale equity securities incorporated reference company’s current report form 8k filed december 23 2016 178 unregistered sale equity securities incorporated reference company’s current report form 8k filed december 29 2016 179 investment agreement azure capital incorporated reference company’s current report form 8k filed march 7 2017 1710 unregistered sale equity securities incorporated reference company’s current report form 8k filed april 10 2017 1711 private stock purchase sale agreement maxagro farm srl incorporated reference company’s current report form 8k filed june 1 2017 1712 contract transfer shares” purchase 51 equity ownership constructii sa incorporated reference company’s current report form 8k filed june 30 2017 1713 unregistered sale equity securities incorporated reference company’s current report form 8k filed july 27 2017 1714 amendment private stock purchase sale agreement maxagro farm srl incorporated reference company’s current report form 8k filed august 9 2017 1715 agreement purchase sale rush gold royalty inc wyoming corporation acquire 51 ownership twentyone mining claims area approximately 400 acres granite mining district grant county oregon usa incorporated reference company’s current report form 8k filed september 7 2017 1716 registration statements connection azure capital investment agreement incorporated reference company’s s1 registration statement filed april 3 2017 1717 withdrawal registration statement filed august 7 2017 new s1 registration statement filed august 7 2017 s1a filed september 15 2017 1718 closing memorandum agreement purchase sale rush gold royalty inc wyoming corporation acquire 51 ownership twentyone mining claims area approximately 400 acres granite mining district grant county oregon usa incorporated reference company’s current report form 8k filed october 9 2017 1 incorporated reference company’s registration statement form s18 declared effective august 10 1982 sec file 278335ny company’s annual report form 10k fiscal year ended june 30 1995 2 incorporated reference company’s current report form 8k dated september 7 1995 3 incorporated reference company’s current report form 8ka dated september 12 1995 4 incorporated reference company’s current report form 8k dated march 1 1996 5 incorporated reference form 10ksb year ended june 30 2000 filed october 16 2001 6 incorporated reference form 10ksb year ended june 30 2001 filed december 17 2001 7 incorporated reference form 10qsb quarter ended march 31 2002 filed may 14 2002 8 incorporated reference form 10ksb year ended june 30 2003 filed october 17 2003 exhibit index continued 101ins xbrl instance document 101sch xbrl taxonomy extension schema document 101cal xbrl taxonomy extension calculation linkbase document 101def xbrl taxonomy extension definition linkbase document 101lab xbrl taxonomy extension label linkbase document 101pre xbrl taxonomy extension presentation linkbase document signatures pursuant requirement section 12 securities exchange act 1934 registrant duly caused registration statement signed behalf undersigned thereunto duly authorized accordance exchange act 1934 report signed following persons behalf company capacities dates indicated signature title date henry fahman chairmanpresidentacting chief financial officer march 11 2021 henry fahman tina phan secretarytreasurer march 11 2021 tina phan tam bui director march 11 2021 tam bui frank hawkins director march 11 2021 frank hawkins item 15 exhibits financial statements schedules financial statements following consolidated financial statements phi group inc subsidiaries included consolidated balance sheets june 30 2011 2010 consolidated statements operations fiscal years ended june 30 2011 2010 consolidated statements cash flows fiscal years ended june 30 2011 2010 consolidated statements changes owners’ equity fiscal years ended june 30 2011 2010 notes consolidated financial statements report independent registered public accounting firm dave banerjee cpa exhibit description 21 plan exchange company prima eastwest model management inc incorporated reference exhibit 2 form 8k filed march 1 1996 22 corporate combination agreement company providential securities inc effective january 14 2000 incorporated reference exhibit 1012 form 10ksb filed january 10 2000 31 articles incorporation 1 32 amendment articles incorporation incorporated reference exhibit 31 form 10ksb fiscal year ended june 30 1995 33 amendment articles incorporation 6 34 certificate amendment articles incorporation 635 bylaws amended 6 41 form series 1 bridge notes purchase security agreement company investors dated march 27 2000 6 42 form series 1 bridge note executed company issued company investors 6 43 form common stock purchase warrant issued company investors 6 44 form repricing warrant issued company investors 6 45 form registration rights agreement company investors dated march 27 2000 6 46 form common stock purchase warrant issued company sovereign capital advisors llc 6 47 form convertible promissory note issued company preferred shareholders providential securities inc 6 51 opinion validity agreements 6 101 benatone exchange agreement creditors 2 102 benatone share acquisition agreement weldnow enterprise ltd 2 103 benatone share acquisition agreement dynedeem limited 2 104 benatone exchange agreement 2 105 benatone asset sale agreement 2 106 benatone royalty agreement 2 107 benatone consultancy agreement 2 108 benatone deed 2 109 autokraft stock purchase agreement 3 1010 autokraft stock subscription agreement 3 1011 prima agreement plan merger 4 1012 escrow agreement company warshaw burstein cohen schelsinger kuh llp dated march 28 2000 6 1013 placement agency agreement company sovereign capital advisors llc dated march 28 2000 6 1014 guaranty agreement henry fahman sovcap equity partners ltd dated march 28 2000 6 1015 pledge agreement henry fahman sovcap equity partners ltd dated march 28 2000 6 1016 partnership purchase agreement company holt collins dated may 31 2000 6 1017 memorandum agreement datalogic consulting inc phi group inc dated april 25 2001 5 10181 letter intent phi group inc epicenter inc dated october 30 2000 5 10182 amendment letter intent phi group inc epicenter inc dated november 30 2000 5 10183 amendment letter intent phi group inc epicenter inc dated january 12 2001 5 10184 amendment letter intent phi group inc epicenter inc dated june 26 2001 5 10185 amendment letter intent phi group inc epicenter inc dated october 02 2001 5 1019 joint venture agreement providential holdings inc boxo inc dated january 1 2001 5 1020 license manna technologies joint venture company dated march 21 2001 5 1021 memorandum agreement international consulting training center ministry trade vietnam company dated march 24 2001 5 1022 memorandum agreement among general transportation company 5 chu lai industrial zone company dated march 25 2001 5 1023 letter intent phi group inc global systems technologies corp dated october 18 2001 6 1024 letter intent phi group inc estate planning investment company dated november 7 2001 6 1025 joint venture agreement phi group inc mimi ban dated november 23 2001 6 1026 plan acquisition nettel global communication corp incorporated reference companys current report form 8k filed may 3 2002 1027 joint venture agreement vietnams minh hieu joint stock company 7 1028 memorandum agreement hdt enterprises llc dated march 15 2002 7 1029 memorandum agreement principle contract vietnams center telecom technology 7 1030 stock purchase agreement slimtech inc incorporated reference companys current report form 8k filed may 1 2002 1031 stock purchase agreement atc technology corp incorporated reference companys current report form 8k filed september 17 2002 1032 mutual rescission stock purchase agreement nettel global communication corp 8 1033 business consulting agreement nettel global communication corp 8 1034 business consulting agreement medical career college 8 1035 mutual rescission stock purchase agreement slimtech 8 1036 mutual rescission stock purchase agreement clear pass inc 8 1037 mutual rescission joint venture agreement htv co ltd 8 1038 mutual rescission stock purchase agreement real id technology 8 1039 business consulting agreement lexor incorporated 8 1040 amended closing memorandum atc technology corp 8 1041 stock purchase agreement tangshan yutiansaw corporation incorporated reference companys current report form 8k filed june 15 2004 1042 asset purchase agreement western medical inc incorporated reference companys current report form 8k file june 2 2006 1043 principle business cooperation agreement cavico vietnam joint stock corporation incorporated reference companys current report form 8k filed october 2 2006 161 notification change accountants kabani co appointed incorporated reference exhibits filed form 8ka filed september 10 2001 171 resignation nhi le director officer appointment thorman hwinn director incorporated reference exhibits filed form 8k filed july 9 2001 172 resignation tam bui director incorporated reference companys current report form 8k filed september 30 2004 173 resignation gene bennett chief financial officer incorporated reference companys current report form 8k filed march 23 2005 174 resignation robert stevenson director incorporated reference companys current report form 8k filed july 18 2006 175 resignation ghanshyam dass director incorporated reference company’s current report form 8k filed september 29 2010 211 subsidiaries registrant 231 consent accountants 321322 certifications accordance sections 302 906 sarbanesoxley act 2002 1 incorporated reference companys registration statement form s18 declared effective august 10 1982 sec file 278335ny companys annual report form 10k fiscal year ended june 30 1995 2 incorporated reference companys current report form 8k dated september 7 1995 3 incorporated reference companys current report form 8ka dated september 12 1995 4 incorporated reference companys current report form 8k dated march 1 1996 5 incorporated reference form 10ksb year ended june 30 2000 filed october 16 2001 6 incorporated reference form 10ksb year ended june 30 2001 filed december 17 2001 7 incorporated reference form 10qsb quarter ended march 31 2002 filed may 14 2002 8 incorporated reference form 10ksb year ended june 30 2003 filed october 17 2003 signatures pursuant requirement section 12 securities exchange act 1934 registrant duly caused registration statement signed behalf undersigned thereunto duly authorized phi group inc date october 13 2011 henry fahman henry fahman president accordance exchange act 1934 report signed following persons behalf company capacities dates indicated signature title date henry fahman chairmanpresidentacting chief financial officer 13oct11 henry fahman tina phan treasurer 13oct11 tina phan tam bui director 13oct11 tam bui sfrank hawkins director 13oct11 frank hawkins spaul k nguyen director 13oct11 paul k nguyen lawrence g olson director 13oct11 lawrence g olson item 15 exhibits financial statements schedules financial statements following consolidated financial statements phi group inc subsidiaries included exhibit description 21 plan exchange company prima eastwest model management inc incorporated reference exhibit 2 form 8k filed march 1 1996 22 corporate combination agreement company providential securities inc effective january 14 2000 incorporated reference exhibit 1012 form 10ksb filed january 10 2000 31 articles incorporation 1 32 amendment articles incorporation incorporated reference exhibit 31 form 10ksb fiscal year ended june 30 1995 33 amendment articles incorporation 6 34 certificate amendment articles incorporation 635 bylaws amended 6 41 form series 1 bridge notes purchase security agreement company investors dated march 27 2000 6 42 form series 1 bridge note executed company issued company investors 6 43 form common stock purchase warrant issued company investors 6 44 form repricing warrant issued company investors 6 45 form registration rights agreement company investors dated march 27 2000 6 46 form common stock purchase warrant issued company sovereign capital advisors llc 6 47 form convertible promissory note issued company preferred shareholders providential securities inc 6 51 opinion validity agreements 6 101 benatone exchange agreement creditors 2 102 benatone share acquisition agreement weldnow enterprise ltd 2 103 benatone share acquisition agreement dynedeem limited 2 104 benatone exchange agreement 2 105 benatone asset sale agreement 2 106 benatone royalty agreement 2 107 benatone consultancy agreement 2 108 benatone deed 2 109 autokraft stock purchase agreement 3 1010 autokraft stock subscription agreement 3 1011 prima agreement plan merger 4 1012 escrow agreement company warshaw burstein cohen schelsinger kuh llp dated march 28 2000 6 1013 placement agency agreement company sovereign capital advisors llc dated march 28 2000 6 1014 guaranty agreement henry fahman sovcap equity partners ltd dated march 28 2000 6 1015 pledge agreement henry fahman sovcap equity partners ltd dated march 28 2000 6 1016 partnership purchase agreement company holt collins dated may 31 2000 6 1017 memorandum agreement datalogic consulting inc phi group inc dated april 25 2001 5 10181 letter intent phi group inc epicenter inc dated october 30 2000 5 10182 amendment letter intent phi group inc epicenter inc dated november 30 2000 5 10183 amendment letter intent phi group inc epicenter inc dated january 12 2001 5 10184 amendment letter intent phi group inc epicenter inc dated june 26 2001 5 10185 amendment letter intent phi group inc epicenter inc dated october 02 2001 5 1019 joint venture agreement providential holdings inc boxo inc dated january 1 2001 5 1020 license manna technologies joint venture company dated march 21 2001 5 1021 memorandum agreement international consulting training center ministry trade vietnam company dated march 24 2001 5 1022 memorandum agreement among general transportation company 5 chu lai industrial zone company dated march 25 2001 5 1023 letter intent phi group inc global systems technologies corp dated october 18 2001 6 1024 letter intent phi group inc estate planning investment company dated november 7 2001 6 1025 joint venture agreement phi group inc mimi ban dated november 23 2001 6 1026 plan acquisition nettel global communication corp incorporated reference company’s current report form 8k filed may 3 2002 1027 joint venture agreement vietnam’s minh hieu joint stock company 7 1028 memorandum agreement hdt enterprises llc dated march 15 2002 7 1029 memorandum agreement principle contract vietnam’s center telecom technology 7 1030 stock purchase agreement slimtech inc incorporated reference company’s current report form 8k filed may 1 2002 1031 stock purchase agreement atc technology corp incorporated reference company’s current report form 8k filed september 17 2002 1032 mutual rescission stock purchase agreement nettel global communication corp 8 1033 business consulting agreement nettel global communication corp 8 1034 business consulting agreement medical career college 8 1035 mutual rescission stock purchase agreement slimtech 8 1036 mutual rescission stock purchase agreement clear pass inc 8 1037 mutual rescission joint venture agreement htv co ltd 8 1038 mutual rescission stock purchase agreement real id technology 8 1039 business consulting agreement lexor incorporated 8 1040 amended closing memorandum atc technology corp 8 1041 stock purchase agreement tangshan yutiansaw corporation incorporated reference company’s current report form 8k filed june 15 2004 1042 asset purchase agreement western medical inc incorporated reference company’s current report form 8k file june 2 2006 1043 principle business cooperation agreement cavico vietnam joint stock corporation incorporated reference company’s current report form 8k filed october 2 2006 161 notification change accountants kabani co appointed incorporated reference exhibits filed form 8ka filed september 10 2001 171 resignation nhi le director officer appointment thorman hwinn director incorporated reference exhibits filed form 8k filed july 9 2001 172 resignation tam bui director incorporated reference company’s current report form 8k filed september 30 2004 173 resignation gene bennett chief financial officer incorporated reference company’s current report form 8k filed march 23 2005 174 resignation robert stevenson director incorporated reference company’s current report form 8k filed july 18 2006 175 resignation ghanshyam dass director incorporated reference company’s current report form 8k filed september 29 2010 176 resignation paul nguyen director attached herewith 211 subsidiary registrant 311322 certifications accordance sections 302 906 sarbanesoxley act 2002 101ins xbrl instance document 101sch xbrl taxonomy extension schema document 101cal xbrl taxonomy extension calculation linkbase document 101def xbrl taxonomy extension definition linkbase document 101lab xbrl taxonomy extension label linkbase document 101pre xbrl taxonomy extension presentation linkbase document 1 incorporated reference company’s registration statement form s18 declared effective august 10 1982 sec file 278335ny company’s annual report form 10k fiscal year ended june 30 1995 2 incorporated reference company’s current report form 8k dated september 7 1995 3 incorporated reference company’s current report form 8ka dated september 12 1995 4 incorporated reference company’s current report form 8k dated march 1 1996 5 incorporated reference form 10ksb year ended june 30 2000 filed october 16 2001 6 incorporated reference form 10ksb year ended june 30 2001 filed december 17 2001 7 incorporated reference form 10qsb quarter ended march 31 2002 filed may 14 2002 8 incorporated reference form 10ksb year ended june 30 2003 filed october 17 2003 signatures pursuant requirement section 12 securities exchange act 1934 registrant duly caused registration statement signed behalf undersigned thereunto duly authorized phi group inc dated june 2 2014 henry fahman henry fahman president accordance exchange act 1934 report signed following persons behalf company capacities dates indicated signature title date henry fahman henry fahman chairmanpresidentacting chief financial officer june 2 2014 tina phan treasurer june 2 2014 tina phan tam bui director june 2 2014 tam bui frank hawkins director june 2 2014 frank hawkins item 15 exhibits financial statements schedules financial statements following consolidated financial statements phi group inc subsidiaries included consolidated balance sheets june 30 2013 2012 consolidated statements operations fiscal years ended june 30 2013 2012 consolidated statements cash flows fiscal years ended june 30 2013 2012 consolidated statements changes owners’ equity fiscal years ended june 30 2013 2012 notes consolidated financial statements report independent registered public accounting firm dave banerjee cpa exhibit description 21 plan exchange company prima eastwest model management inc incorporated reference exhibit 2 form 8k filed march 1 1996 22 corporate combination agreement company providential securities inc effective january 14 2000 incorporated reference exhibit 1012 form 10ksb filed january 10 2000 31 articles incorporation 1 32 amendment articles incorporation incorporated reference exhibit 31 form 10ksb fiscal year ended june 30 1995 33 amendment articles incorporation 6 34 certificate amendment articles incorporation 635 bylaws amended 6 41 form series 1 bridge notes purchase security agreement company investors dated march 27 2000 6 42 form series 1 bridge note executed company issued company investors 6 43 form common stock purchase warrant issued company investors 6 44 form repricing warrant issued company investors 6 45 form registration rights agreement company investors dated march 27 2000 6 46 form common stock purchase warrant issued company sovereign capital advisors llc 6 47 form convertible promissory note issued company preferred shareholders providential securities inc 6 51 opinion validity agreements 6 101 benatone exchange agreement creditors 2 102 benatone share acquisition agreement weldnow enterprise ltd 2 103 benatone share acquisition agreement dynedeem limited 2 104 benatone exchange agreement 2 105 benatone asset sale agreement 2 106 benatone royalty agreement 2 107 benatone consultancy agreement 2 108 benatone deed 2 109 autokraft stock purchase agreement 3 1010 autokraft stock subscription agreement 3 1011 prima agreement plan merger 4 1012 escrow agreement company warshaw burstein cohen schelsinger kuh llp dated march 28 2000 6 1013 placement agency agreement company sovereign capital advisors llc dated march 28 2000 6 1014 guaranty agreement henry fahman sovcap equity partners ltd dated march 28 2000 6 1015 pledge agreement henry fahman sovcap equity partners ltd dated march 28 2000 6 1016 partnership purchase agreement company holt collins dated may 31 2000 6 1017 memorandum agreement datalogic consulting inc phi group inc dated april 25 2001 5 10181 letter intent phi group inc epicenter inc dated october 30 2000 5 10182 amendment letter intent phi group inc epicenter inc dated november 30 2000 5 10183 amendment letter intent phi group inc epicenter inc dated january 12 2001 5 10184 amendment letter intent phi group inc epicenter inc dated june 26 2001 5 10185 amendment letter intent phi group inc epicenter inc dated october 02 2001 5 1019 joint venture agreement providential holdings inc boxo inc dated january 1 2001 5 1020 license manna technologies joint venture company dated march 21 2001 5 1021 memorandum agreement international consulting training center ministry trade vietnam company dated march 24 2001 5 1022 memorandum agreement among general transportation company 5 chu lai industrial zone company dated march 25 2001 5 1023 letter intent phi group inc global systems technologies corp dated october 18 2001 6 1024 letter intent phi group inc estate planning investment company dated november 7 2001 6 1025 joint venture agreement phi group inc mimi ban dated november 23 2001 6 1026 plan acquisition nettel global communication corp incorporated reference company’s current report form 8k filed may 3 2002 1027 joint venture agreement vietnam’s minh hieu joint stock company 7 1028 memorandum agreement hdt enterprises llc dated march 15 2002 7 1029 memorandum agreement principle contract vietnam’s center telecom technology 7 1030 stock purchase agreement slimtech inc incorporated reference company’s current report form 8k filed may 1 2002 1031 stock purchase agreement atc technology corp incorporated reference company’s current report form 8k filed september 17 2002 1032 mutual rescission stock purchase agreement nettel global communication corp 8 1033 business consulting agreement nettel global communication corp 8 1034 business consulting agreement medical career college 8 1035 mutual rescission stock purchase agreement slimtech 8 1036 mutual rescission stock purchase agreement clear pass inc 8 1037 mutual rescission joint venture agreement htv co ltd 8 1038 mutual rescission stock purchase agreement real id technology 8 1039 business consulting agreement lexor incorporated 8 1040 amended closing memorandum atc technology corp 8 1041 stock purchase agreement tangshan yutiansaw corporation incorporated reference company’s current report form 8k filed june 15 2004 1042 asset purchase agreement western medical inc incorporated reference company’s current report form 8k file june 2 2006 1043 principle business cooperation agreement cavico vietnam joint stock corporation incorporated reference company’s current report form 8k filed october 2 2006 161 notification change accountants kabani co appointed incorporated reference exhibits filed form 8ka filed september 10 2001 171 resignation nhi le director officer appointment thorman hwinn director incorporated reference exhibits filed form 8k filed july 9 2001 172 resignation tam bui director incorporated reference company’s current report form 8k filed september 30 2004 173 resignation gene bennett chief financial officer incorporated reference company’s current report form 8k filed march 23 2005 174 resignation robert stevenson director incorporated reference company’s current report form 8k filed july 18 2006 175 resignation ghanshyam dass director incorporated reference company’s current report form 8k filed september 29 2010 176 resignation paul nguyen director incorporated reference company’s annual report fiscal year ended june 30 2012 filed securities exchange commission june 2 2014 211 subsidiary registrant 311322 certifications accordance sections 302 906 sarbanesoxley act 2002 101ins xbrl instance document 101sch xbrl taxonomy extension schema document 101cal xbrl taxonomy extension calculation linkbase document 101def xbrl taxonomy extension definition linkbase document 101lab xbrl taxonomy extension label linkbase document 101pre xbrl taxonomy extension presentation linkbase document 1 incorporated reference company’s registration statement form s18 declared effective august 10 1982 sec file 278335ny company’s annual report form 10k fiscal year ended june 30 1995 2 incorporated reference company’s current report form 8k dated september 7 1995 3 incorporated reference company’s current report form 8ka dated september 12 1995 4 incorporated reference company’s current report form 8k dated march 1 1996 5 incorporated reference form 10ksb year ended june 30 2000 filed october 16 2001 6 incorporated reference form 10ksb year ended june 30 2001 filed december 17 2001 7 incorporated reference form 10qsb quarter ended march 31 2002 filed may 14 2002 8 incorporated reference form 10ksb year ended june 30 2003 filed october 17 2003 signatures pursuant requirement section 12 securities exchange act 1934 registrant duly caused registration statement signed behalf undersigned thereunto duly authorized phi group inc dated september 25 2014 henry fahman henry fahman president accordance exchange act 1934 report signed following persons behalf company capacities dates indicated signature title date henry fahman chairmanpresidentacting chief financial officer september 25 2014 henry fahman tina phan treasurer september 25 2014 tina phan tam bui director september 25 2014 tam bui frank hawkins director september 25 2014 frank hawkins item 15 exhibits financial statements schedules financial statements following consolidated financial statements phi group inc subsidiaries included consolidated balance sheets june 30 2017 2016 consolidated statements operations fiscal years ended june 30 2017 2016 consolidated statements cash flows fiscal years ended june 30 2017 2016 consolidated statements changes owners’ equity fiscal years ended june 30 2017 2016 notes consolidated financial statements report independent registered public accounting firm dave banerjee cpa exhibit description 21 plan exchange company prima eastwest model management inc incorporated reference exhibit 2 form 8k filed march 1 1996 22 corporate combination agreement company providential securities inc effective january 14 2000 incorporated reference exhibit 1012 form 10ksb filed january 10 2000 31 articles incorporation 1 32 amendment articles incorporation incorporated reference exhibit 31 form 10ksb fiscal year ended june 30 1995 33 amendment articles incorporation 6 34 certificate amendment articles incorporation 635 bylaws amended 6 41 form series 1 bridge notes purchase security agreement company investors dated march 27 2000 6 42 form series 1 bridge note executed company issued company investors 6 43 form common stock purchase warrant issued company investors 6 44 form repricing warrant issued company investors 6 45 form registration rights agreement company investors dated march 27 2000 6 46 form common stock purchase warrant issued company sovereign capital advisors llc 6 47 form convertible promissory note issued company preferred shareholders providential securities inc 6 51 opinion validity agreements 6 101 benatone exchange agreement creditors 2 102 benatone share acquisition agreement weldnow enterprise ltd 2 exhibit description 103 benatone share acquisition agreement dynedeem limited 2 104 benatone exchange agreement 2 105 benatone asset sale agreement 2 106 benatone royalty agreement 2 107 benatone consultancy agreement 2 108 benatone deed 2 109 autokraft stock purchase agreement 3 1010 autokraft stock subscription agreement 3 1011 prima agreement plan merger 4 1012 escrow agreement company warshaw burstein cohen schelsinger kuh llp dated march 28 2000 6 1013 placement agency agreement company sovereign capital advisors llc dated march 28 2000 6 1014 guaranty agreement henry fahman sovcap equity partners ltd dated march 28 2000 6 1015 pledge agreement henry fahman sovcap equity partners ltd dated march 28 2000 6 1016 partnership purchase agreement company holt collins dated may 31 2000 6 1017 memorandum agreement datalogic consulting inc phi group inc dated april 25 2001 5 10181 letter intent phi group inc epicenter inc dated october 30 2000 5 10182 amendment letter intent phi group inc epicenter inc dated november 30 2000 5 10183 amendment letter intent phi group inc epicenter inc dated january 12 2001 5 10184 amendment letter intent phi group inc epicenter inc dated june 26 2001 5 10185 amendment letter intent phi group inc epicenter inc dated october 02 2001 5 1019 joint venture agreement providential holdings inc boxo inc dated january 1 2001 5 1020 license manna technologies joint venture company dated march 21 2001 5 1021 memorandum agreement international consulting training center ministry trade vietnam company dated march 24 2001 5 1022 memorandum agreement among general transportation company 5 chu lai industrial zone company dated march 25 2001 5 1023 letter intent phi group inc global systems technologies corp dated october 18 2001 6 1024 letter intent phi group inc estate planning investment company dated november 7 2001 6 1025 joint venture agreement phi group inc mimi ban dated november 23 2001 6 1026 plan acquisition nettel global communication corp incorporated reference company’s current report form 8k filed may 3 2002 1027 joint venture agreement vietnam’s minh hieu joint stock company 7 1028 memorandum agreement hdt enterprises llc dated march 15 2002 7 1029 memorandum agreement principal contract vietnam’s center telecom technology 7 1030 stock purchase agreement slimtech inc incorporated reference company’s current report form 8k filed may 1 2002 1031 stock purchase agreement atc technology corp incorporated reference company’s current report form 8k filed september 17 2002 1032 mutual rescission stock purchase agreement nettel global communication corp 8 1033 business consulting agreement nettel global communication corp 8 1034 business consulting agreement medical career college 8 1035 mutual rescission stock purchase agreement slimtech 8 1036 mutual rescission stock purchase agreement clear pass inc 8 1037 mutual rescission joint venture agreement htv co ltd 8 1038 mutual rescission stock purchase agreement real id technology 8 1039 business consulting agreement lexor incorporated 8 1040 amended closing memorandum atc technology corp 8 1041 stock purchase agreement tangshan yutiansaw corporation incorporated reference company’s current report form 8k filed june 15 2004 1042 asset purchase agreement western medical inc incorporated reference company’s current report form 8k file june 2 2006 exhibit description 1043 principle business cooperation agreement cavico vietnam joint stock corporation incorporated reference company’s current report form 8k filed october 2 2006 161 notification change accountants kabani co appointed incorporated reference exhibits filed form 8ka filed september 10 2001 171 resignation nhi le director officer appointment thorman hwinn director incorporated reference exhibits filed form 8k filed july 9 2001 172 resignation tam bui director incorporated reference company’s current report form 8k filed september 30 2004 173 resignation gene bennett chief financial officer incorporated reference company’s current report form 8k filed march 23 2005 174 resignation robert stevenson director incorporated reference company’s current report form 8k filed july 18 2006 175 resignation ghanshyam dass director incorporated reference company’s current report form 8k filed september 29 2010 176 resignation paul nguyen director incorporated reference company’s annual report fiscal year ended june 30 2012 filed securities exchange commission june 2 2014 177 unregistered sale equity securities incorporated reference company’s current report form 8k filed december 23 2016 178 unregistered sale equity securities incorporated reference company’s current report form 8k filed december 29 2016 179 investment agreement azure capital incorporated reference company’s current report form 8k filed march 7 2017 1710 unregistered sale equity securities incorporated reference company’s current report form 8k filed april 10 2017 1711 private stock purchase sale agreement maxagro farm srl incorporated reference company’s current report form 8k filed june 1 2017 1712 contract transfer shares” purchase 51 equity ownership constructii sa incorporated reference company’s current report form 8k filed june 30 2017 1713 unregistered sale equity securities incorporated reference company’s current report form 8k filed july 27 2017 1714 amendment private stock purchase sale agreement maxagro farm srl incorporated reference company’s current report form 8k filed august 9 2017 1715 agreement purchase sale rush gold royalty inc wyoming corporation acquire 51 ownership twentyone mining claims area approximately 400 acres granite mining district grant county oregon usa incorporated reference company’s current report form 8k filed september 7 2017 1716 registration statements connection azure capital investment agreement incorporated reference company’s s1 registration statement filed april 3 2017 withdrawal registration statement filed august 7 2017 new s1 registration statement filed august 7 2017 s1a filed september 15 2017 1717 closing memorandum agreement purchase sale rush gold royalty inc wyoming corporation acquire 51 ownership twentyone mining claims area approximately 400 acres granite mining district grant county oregon usa incorporated reference company’s current report form 8k filed october 9 2017 211 subsidiary registrant 311322 certifications accordance sections 302 906 sarbanesoxley act 2002 101ins xbrl instance document 101sch xbrl taxonomy extension schema document 101cal xbrl taxonomy extension calculation linkbase document 101def xbrl taxonomy extension definition linkbase document 101lab xbrl taxonomy extension label linkbase document 101pre xbrl taxonomy extension presentation linkbase document 1 incorporated reference company’s registration statement form s18 declared effective august 10 1982 sec file 278335ny company’s annual report form 10k fiscal year ended june 30 1995 2 incorporated reference company’s current report form 8k dated september 7 1995 3 incorporated reference company’s current report form 8ka dated september 12 1995 4 incorporated reference company’s current report form 8k dated march 1 1996 5 incorporated reference form 10ksb year ended june 30 2000 filed october 16 2001 6 incorporated reference form 10ksb year ended june 30 2001 filed december 17 2001 7 incorporated reference form 10qsb quarter ended march 31 2002 filed may 14 2002 8 incorporated reference form 10ksb year ended june 30 2003 filed october 17 2003 signatures pursuant requirement section 12 securities exchange act 1934 registrant duly caused registration statement signed behalf undersigned thereunto duly authorized phi group inc dated october 13 2017 bys henry fahman henry fahman president accordance exchange act 1934 report signed following persons behalf company capacities dates indicated signature title date henry fahman henry fahman chairmanpresidentacting chief financial officer october 13 2017 tina phan treasurer october 13 2017 tina phan tam bui director october 13 2017 tam bui frank hawkins director october 13 2017 frank hawkins item 15 exhibits financial statements schedules financial statements following consolidated financial statements phi group inc subsidiaries included notes consolidated financial statements report independent registered public accounting firm kabani company exhibit description 21 plan exchange company prima eastwest model management inc incorporated reference exhibit 2 form 8k filed march 1 1996 22 corporate combination agreement company providential securities inc effective january 14 2000 incorporated reference exhibit 1012 form 10ksb filed january 10 2000 31 articles incorporation 1 32 amendment articles incorporation incorporated reference exhibit 31 form 10ksb fiscal year ended june 30 1995 33 amendment articles incorporation 6 34 certificate amendment articles incorporation 635 bylaws amended 6 41 form series 1 bridge notes purchase security agreement company investors dated march 27 2000 6 42 form series 1 bridge note executed company issued company investors 6 43 form common stock purchase warrant issued company investors 6 44 form repricing warrant issued company investors 6 45 form registration rights agreement company investors dated march 27 2000 6 46 form common stock purchase warrant issued company sovereign capital advisors llc 6 47 form convertible promissory note issued company preferred shareholders providential securities inc 6 51 opinion validity agreements 6 101 benatone exchange agreement creditors 2 102 benatone share acquisition agreement weldnow enterprise ltd 2 103 benatone share acquisition agreement dynedeem limited 2 104 benatone exchange agreement 2 105 benatone asset sale agreement 2 106 benatone royalty agreement 2 107 benatone consultancy agreement 2 108 benatone deed 2 109 autokraft stock purchase agreement 3 1010 autokraft stock subscription agreement 3 1011 prima agreement plan merger 4 signatures pursuant requirement section 12 securities exchange act 1934 registrant duly caused registration statement signed behalf undersigned thereunto duly authorized phi group inc date october 13 2009 henry fahman henry fahman president accordance exchange act 1934 report signed following persons behalf company capacities dates indicated item 15 exhibits financial statements schedules financial statements following consolidated financial statements phi group inc subsidiaries included exhibit index exhibit description 21 plan exchange company prima eastwest model management inc incorporated reference exhibit 2 form 8k filed march 1 1996 22 corporate combination agreement company providential securities inc effective january 14 2000 incorporated reference exhibit 1012 form 10ksb filed january 10 2000 31 articles incorporation 1 32 amendment articles incorporation incorporated reference exhibit 31 form 10ksb fiscal year ended june 30 1995 33 amendment articles incorporation 6 34 certificate amendment articles incorporation 6 35 bylaws amended 6 41 form series 1 bridge notes purchase security agreement company investors dated march 27 2000 6 42 form series 1 bridge note executed company issued company investors 6 43 form common stock purchase warrant issued company investors 6 44 form repricing warrant issued company investors 6 45 form registration rights agreement company investors dated march 27 2000 6 46 form common stock purchase warrant issued company sovereign capital advisors llc 6 47 form convertible promissory note issued company preferred shareholders providential securities inc 6 51 opinion validity agreements 6 101 benatone exchange agreement creditors 2 102 benatone share acquisition agreement weldnow enterprise ltd 2 103 benatone share acquisition agreement dynedeem limited 2 104 benatone exchange agreement 2 105 benatone asset sale agreement 2 106 benatone royalty agreement 2 107 benatone consultancy agreement 2 108 benatone deed 2 109 autokraft stock purchase agreement 3 1010 autokraft stock subscription agreement 3 1011 prima agreement plan merger 4 1012 escrow agreement company warshaw burstein cohen schelsinger kuh llp dated march 28 2000 6 1013 placement agency agreement company sovereign capital advisors llc dated march 28 2000 6 1014 guaranty agreement henry fahman sovcap equity partners ltd dated march 28 2000 6 1015 pledge agreement henry fahman sovcap equity partners ltd dated march 28 2000 6 1016 partnership purchase agreement company holt collins dated may 31 2000 6 1017 memorandum agreement datalogic consulting inc phi group inc dated april 25 2001 5 10181 letter intent phi group inc epicenter inc dated october 30 2000 5 10182 amendment letter intent phi group inc epicenter inc dated november 30 2000 5 10183 amendment letter intent phi group inc epicenter inc dated january 12 2001 5 10184 amendment letter intent phi group inc epicenter inc dated june 26 2001 5 10185 amendment letter intent phi group inc epicenter inc dated october 02 2001 5 1019 joint venture agreement providential holdings inc boxo inc dated january 1 2001 5 1020 license manna technologies joint venture company dated march 21 2001 5 1021 memorandum agreement international consulting training center ministry trade vietnam company dated march 24 2001 5 1022 memorandum agreement among general transportation company 5 chu lai industrial zone company dated march 25 2001 5 1023 letter intent phi group inc global systems technologies corp dated october 18 2001 6 1024 letter intent phi group inc estate planning investment company dated november 7 2001 6 1025 joint venture agreement phi group inc mimi ban dated november 23 2001 6 1026 plan acquisition nettel global communication corp incorporated reference company’s current report form 8k filed may 3 2002 1027 joint venture agreement vietnam’s minh hieu joint stock company 7 1028 memorandum agreement hdt enterprises llc dated march 15 2002 7 1029 memorandum agreement principal contract vietnam’s center telecom technology 7 1030 stock purchase agreement slimtech inc incorporated reference company’s current report form 8k filed may 1 2002 1031 stock purchase agreement atc technology corp incorporated reference company’s current report form 8k filed september 17 2002 1032 mutual rescission stock purchase agreement nettel global communication corp 8 1033 business consulting agreement nettel global communication corp 8 1034 business consulting agreement medical career college 8 1035 mutual rescission stock purchase agreement slimtech 8 1036 mutual rescission stock purchase agreement clear pass inc 8 1037 mutual rescission joint venture agreement htv co ltd 8 1038 mutual rescission stock purchase agreement real id technology 8 1039 business consulting agreement lexor incorporated 8 1040 amended closing memorandum atc technology corp 8 1041 stock purchase agreement tangshan yutiansaw corporation incorporated reference company’s current report form 8k filed june 15 2004 1042 asset purchase agreement western medical inc incorporated reference company’s current report form 8k file june 2 2006 1043 principle business cooperation agreement cavico vietnam joint stock corporation incorporated reference company’s current report form 8k filed october 2 2006 161 notification change accountants kabani co appointed incorporated reference exhibits filed form 8ka filed september 10 2001 171 resignation nhi le director officer appointment thorman hwinn director incorporated reference exhibits filed form 8k filed july 9 2001 172 resignation tam bui director incorporated reference company’s current report form 8k filed september 30 2004 173 resignation gene bennett chief financial officer incorporated reference company’s current report form 8k filed march 23 2005 174 resignation robert stevenson director incorporated reference company’s current report form 8k filed july 18 2006 175 resignation ghanshyam dass director incorporated reference company’s current report form 8k filed september 29 2010 176 resignation paul nguyen director incorporated reference company’s annual report fiscal year ended june 30 2012 filed securities exchange commission june 2 2014 177 unregistered sale equity securities incorporated reference company’s current report form 8k filed december 23 2016 178 unregistered sale equity securities incorporated reference company’s current report form 8k filed december 29 2016 179 investment agreement azure capital incorporated reference company’s current report form 8k filed march 7 2017 1710 unregistered sale equity securities incorporated reference company’s current report form 8k filed april 10 2017 1711 private stock purchase sale agreement maxagro farm srl incorporated reference company’s current report form 8k filed june 1 2017 1712 contract transfer shares” purchase 51 equity ownership constructii sa incorporated reference company’s current report form 8k filed june 30 2017 1713 unregistered sale equity securities incorporated reference company’s current report form 8k filed july 27 2017 1714 amendment private stock purchase sale agreement maxagro farm srl incorporated reference company’s current report form 8k filed august 9 2017 1715 agreement purchase sale rush gold royalty inc wyoming corporation acquire 51 ownership twentyone mining claims area approximately 400 acres granite mining district grant county oregon usa incorporated reference company’s current report form 8k filed september 7 2017 1716 registration statements connection azure capital investment agreement incorporated reference company’s s1 registration statement filed april 3 2017 1717 withdrawal registration statement filed august 7 2017 new s1 registration statement filed august 7 2017 s1a filed september 15 2017 1718 closing memorandum agreement purchase sale rush gold royalty inc wyoming corporation acquire 51 ownership twentyone mining claims area approximately 400 acres granite mining district grant county oregon usa incorporated reference company’s current report form 8k filed october 9 2017 1 incorporated reference company’s registration statement form s18 declared effective august 10 1982 sec file 278335ny company’s annual report form 10k fiscal year ended june 30 1995 2 incorporated reference company’s current report form 8k dated september 7 1995 3 incorporated reference company’s current report form 8ka dated september 12 1995 4 incorporated reference company’s current report form 8k dated march 1 1996 5 incorporated reference form 10ksb year ended june 30 2000 filed october 16 2001 6 incorporated reference form 10ksb year ended june 30 2001 filed december 17 2001 7 incorporated reference form 10qsb quarter ended march 31 2002 filed may 14 2002 8 incorporated reference form 10ksb year ended june 30 2003 filed october 17 2003 exhibit index continued 1724 phi group inc approves stock repurchase program 8k 00138255 101 20190326 1725 extension record date special common stock dividend issuer’s subsidiary 8k 00138255 101 20190531 1726 extension record date special common stock dividend issuer’s subsidiary 8k 00138255 101 102 20190925 1727 extension record date special common stock dividend issuer’s subsidiary 8k 00138255 101 20191230 1728 extension repurchase date company’s common stock 8k 00138255 101 20200305 1729 relying order reporting relief 8k 00138255 na 20200515 1730 extension repurchase date company’s common stock extension record date special stock dividend distribution 8k 00138255 101 102 20200630 1731 extension repurchase date company’s common stock extension record date special stock dividend distribution 8k 00138255 101 102 20201229 211 subsidiaries registrant 311 322 certifications accordance sections 302 906 sarbanesoxley act 2002 101ins xbrl instance document 101sch xbrl taxonomy extension schema document 101cal xbrl taxonomy extension calculation linkbase document 101def xbrl taxonomy extension definition linkbase document 101lab xbrl taxonomy extension label linkbase document 101pre xbrl taxonomy extension presentation linkbase document signatures pursuant requirement section 12 securities exchange act 1934 registrant duly caused registration statement signed behalf undersigned thereunto duly authorized accordance exchange act 1934 report signed following persons behalf company capacities dates indicated signature title date henry fahman chairmanpresidentacting chief financial officer june 23 2021 henry fahman tina phan secretarytreasurer june 23 2021 tina phan tam bui director june 23 2021 tam bui frank hawkins director june 23 2021 frank hawkins