| PREPAID EXPENSES AND OTHER CURRENT ASSETS, NET |
NOTE 7 — PREPAID EXPENSES AND OTHER CURRENT
ASSETS, NET
Prepaid expenses and other current assets, net
consist of the following:
| | |
September 30, | | |
March 31, | |
| | |
2025 | | |
2025 | |
| Prepaid social security-employee portion | |
$ | 3,588 | | |
$ | 5,711 | |
| Loans to third parties and employees (a) | |
| 1,770,722 | | |
| 1,022,178 | |
| Security deposits | |
| 99,029 | | |
| 101,004 | |
| VAT recoverable (b) | |
| 149,569 | | |
| 49,972 | |
| Prepaid expenses (c) | |
| 318,114 | | |
| 230,648 | |
| Others | |
| 35,818 | | |
| 38,683 | |
| Subtotal | |
| 2,376,840 | | |
| 1,448,196 | |
| Less: allowance for credit loss | |
| (435,115 | ) | |
| (84,403 | ) |
| Prepaid expenses and other current assets, net | |
$ | 1,941,725 | | |
$ | 1,363,793 | |
| (a) | Loans
to third-parties and employees are mainly used for short-term funding to support various third-party suppliers and employees. These loans
bear no interest and have terms of no more than one year. As of September 30, 2025 and March 31, 2025, the allowance for credit
losses was $431,520 and $80,877, respectively. For loans to third parties and employees, approximately 19.1%, or $338,039 of the September
30, 2025 balances have been subsequently collected as of February 28, 2026. |
| (b) | Entities that are VAT general taxpayers are allowed to offset
qualified input VAT tax paid to suppliers against their output VAT liabilities. When the output VAT exceeds the input VAT, the difference
is remitted to tax authorities; whereas when the input VAT exceeds the output VAT, the difference is treated as VAT recoverable which
can be carried forward to offset future net VAT payables. |
| (c) | Prepaid expenses primarily include prepaid professional expenses
in relation to consulting services. |
|
NOTE 7 —
PREPAID EXPENSES AND OTHER CURRENT ASSETS, NET
Prepaid
expenses and other current assets, net consist of the following:
| | |
March 31, | | |
March 31, | |
| | |
2025 | | |
2024 | |
| Prepaid social security-employee portion | |
$ | 5,711 | | |
$ | 2,709 | |
| Loans to third parties and employees (a) | |
| 1,022,178 | | |
| 1,307,874 | |
| Security deposits | |
| 101,004 | | |
| 94,520 | |
| Deferred IPO costs | |
| — | | |
| 433,007 | |
| VAT recoverable (b) | |
| 49,972 | | |
| — | |
| Prepaid expenses (c) | |
| 230,648 | | |
| 92,088 | |
| Others | |
| 38,683 | | |
| 12,450 | |
| Subtotal | |
| 1,448,196 | | |
| 1,942,648 | |
| Less: allowance for credit loss | |
| (84,403 | ) | |
| (19,647 | ) |
| Prepaid expenses and other current assets, net | |
$ | 1,363,793 | | |
$ | 1,923,001 | |
| ● | Loans to third-parties and employees are mainly used for short-term funding to support various third-party suppliers and employees. These loans bear no interest and have terms of no more than one year. As of March 31, 2025 and 2024, the allowance for credit losses was $80,877 and $19,647, respectively. For loans to third parties and employees, approximately 95.5%, or $975,696 of the March 31, 2025 balances have been subsequently collected as of August 14, 2025. |
| ● | Entities that are VAT general taxpayers are allowed to offset qualified input VAT tax paid to suppliers against their output VAT liabilities. When the output VAT exceeds the input VAT, the difference is remitted to tax authorities; whereas when the input VAT exceeds the output VAT, the difference is treated as VAT recoverable which can be carried forward to offset future net VAT payables. |
| ● | Prepaid expenses primarily include prepaid professional expenses in relation to consulting services. |
|