SEC Comment Letter for Smart Powerr Corp. (CREG) (CIK 0000721693) (CREG) — Feb 28, 2019
Smart Powerr Corp. (CREG) (CIK 0000721693)
Date: Feb. 28, 2019 · CIK: 0000721693 · Accession: 0000000000-19-003474
AI Filing Summary & Sentiment
Reasoning
Letter
Mail Stop 3561 February 28, 2019 Adeline Gu Chief Financial Officer China Recycling Energy Corporation 4/F, Tower C Rong Cheng Yun Gu Building Keji 3rd Road, Yanta District Xi’an City, Shaanxi Province China 710075
Re: China Recycling Energy Corporation Form 10-K for the Fiscal Year Ended December 31, 2017 Filed April 13, 2018 Responses Dated January 11, 2019 and February 22, 2019 File No. 1 -34625
Dear Ms. Gu :
We have reviewed your January 11, 2019 and February 22, 2019 response s to our comment letter and have the following comment s. In some of our comments , we may ask you to provide us with information so we may better understand your disclosure.
Please respond to these comments within ten busine ss days by providing the requested information or advis e us as soon as possible when you will respond. If you do not believe our comments apply to your facts and circumstances, please tell us why in your response.
After review ing your response to these comments, we may have additional comments. Unless we note otherwise, our references to prior comments are to comments in our December 4, 2018 letter .
Adeline Gu China Recycling Energy Corporation February 28 , 201 9 Page 2
Form 10 -K for the Fiscal Year Ended December 31, 2017
Item 8. Financial Statements and Supplementary Data
1. Organization and Description of Business
Erdos TCH – Joint Venture, page F -6
1. We reviewed your responses to comment 1. Your response dated January 11, 2019 states that the modified lease is not an operating lease. You r response dated February 22, 2019 states and the proposed revisions assume the modified lease is an operating lease. Referencing authoritative literature, please explain to us in detail why accounting for the modified lease as an operating lea se is appropriate.
Response Dated February 22, 2019
2. Reference is made to page 2 of proposed Amendment No. 1 to Form 10 -Q for the Quarterly Period Ended June 30, 2016. Please tell us your consideration of classifying the “Impairment loss of net investmen t receivable” as an operating expense.
3. Reference is made to page 28 of proposed Amendment No. 1 to Form 10 -Q for the Quarterly Period Ended June 30, 2016. Please explain to us why general and administrative expenses increased $1,195,742 as a result of th e restatement.
4. Reference is made to page 47 of proposed Amendment No. 1 to Form 10 -Q for the Quarterly Period Ended June 30, 2016. Please tell us whether you re -evaluated your conclusion that disclosure controls and procedures were effective as of June 30, 2016 in light of the restatement. If so, please explain the basis for your conclusion. If not, please tell us your consideration of re -evaluating your assessment.
5. In light of the restatement, please tell us the periodic filings filed subsequent to June 30, 2016 that will be amended to correct the accounting error and when you expect to file the amendments. Please also file the amendment to your June 30, 2016 Form 10 -Q.
Adeline Gu China Recycling Energy Corporation February 28 , 201 9 Page 3
You may contact Adam Phippen, Staff Accountant, at (202) 551 -3336 or me at (202) 551-3344 with any questions.
Sincerely,
/s/ William H. Thompso n
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Mail Stop 3561 February 28, 2019 Adeline Gu Chief Financial Officer China Recycling Energy Corporation 4/F, Tower C Rong Cheng Yun Gu Building Keji 3rd Road, Yanta District Xi’an City, Shaanxi Province China 710075 Re: China Recycling Energy Corporation Form 10-K for the Fiscal Year Ended December 31, 2017 Filed April 13, 2018 Responses Dated January 11, 2019 and February 22, 2019 File No. 1 -34625 Dear Ms. Gu : We have reviewed your January 11, 2019 and February 22, 2019 response s to our comment letter and have the following comment s. In some of our comments , we may ask you to provide us with information so we may better understand your disclosure. Please respond to these comments within ten busine ss days by providing the requested information or advis e us as soon as possible when you will respond. If you do not believe our comments apply to your facts and circumstances, please tell us why in your response. After review ing your response to these comments, we may have additional comments. Unless we note otherwise, our references to prior comments are to comments in our December 4, 2018 letter . Adeline Gu China Recycling Energy Corporation February 28 , 201 9 Page 2 Form 10 -K for the Fiscal Year Ended December 31, 2017 Item 8. Financial Statements and Supplementary Data 1. Organization and Description of Business Erdos TCH – Joint Venture, page F -6 1. We reviewed your responses to comment 1. Your response dated January 11, 2019 states that the modified lease is not an operating lease. You r response dated February 22, 2019 states and the proposed revisions assume the modified lease is an operating lease. Referencing authoritative literature, please explain to us in detail why accounting for the modified lease as an operating lea se is appropriate. Response Dated February 22, 2019 2. Reference is made to page 2 of proposed Amendment No. 1 to Form 10 -Q for the Quarterly Period Ended June 30, 2016. Please tell us your consideration of classifying the “Impairment loss of net investmen t receivable” as an operating expense. 3. Reference is made to page 28 of proposed Amendment No. 1 to Form 10 -Q for the Quarterly Period Ended June 30, 2016. Please explain to us why general and administrative expenses increased $1,195,742 as a result of th e restatement. 4. Reference is made to page 47 of proposed Amendment No. 1 to Form 10 -Q for the Quarterly Period Ended June 30, 2016. Please tell us whether you re -evaluated your conclusion that disclosure controls and procedures were effective as of June 30, 2016 in light of the restatement. If so, please explain the basis for your conclusion. If not, please tell us your consideration of re -evaluating your assessment. 5. In light of the restatement, please tell us the periodic filings filed subsequent to June 30, 2016 that will be amended to correct the accounting error and when you expect to file the amendments. Please also file the amendment to your June 30, 2016 Form 10 -Q. Adeline Gu China Recycling Energy Corporation February 28 , 201 9 Page 3 You may contact Adam Phippen, Staff Accountant, at (202) 551 -3336 or me at (202) 551-3344 with any questions. Sincerely, /s/ William H. Thompso n William H. Thompson Accounting Branch Chief Office of Consumer Products