NOTE 15 – CONCENTRATIONS OF RISK

The Company is exposed to the following concentrations of risk:

(a) Major customers

For the three months ended June 30, 2026, there is no single customer who accounted for 10% of more of the Company’s revenues. For the six months ended June 30, 2026, two customers accounted for approximately 30% and 70 % of the Company’s revenues, total amounting to $255.

For both the three and six months ended June 30, 2025, two customers accounted for approximately 51% and 49 % of the Company’s revenues, amounting to $72,586 and $69,460, respectively. 

All the Company’s customers are located in the PRC.

(b) Major vendors

For the three months ended June 30, 2026, there is no single vendor who accounted for 10% of more of the Company’s purchases. For the six months ended June 30, 2026, two vendors accounted for approximately 58% and 42 % of the Company’s purchases, total amounting to $24.

For the three and six months ended June 30, 2025, two vendors accounted for approximately 77% and 14% of the Company’s total purchases, amounting to $97,508 and $17,843, respectively.

All the Company’s vendors are located in the PRC.

(c) Credit risk

Financial instruments that are potentially subject to credit risk consist principally of trade receivables. The Company believes the concentration of credit risk in its trade receivables is substantially mitigated by its ongoing credit evaluation process and relatively short collection terms. The Company does not generally require collateral from customers. The Company evaluates the need for an allowance for doubtful accounts based upon factors surrounding the credit risk of specific customers, historical trends and other information.

(d) Economic and political risk

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

(e) Exchange rate risk

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