SEC Company Response from China Health Holding, Inc. (CIK 0001302331) — Feb 7, 2005
China Health Holding, Inc. (CIK 0001302331)
Date: Feb. 7, 2005 · CIK: 0001302331 · Accession: 0001013762-05-000151
AI Filing Summary & Sentiment
Letter
Suite 1700 - 1140 West Pender Street Dale Matheson Carr-Hilton LaBonte Vancouver, BC Chartered Accountants V6E 4G1 Phone: 604-687-4747 Fax: 604-687-4216
To: From: Peter J Donaldson, CA Dana Hartz, US Securities and Exchange Commission -------------------------------------------------------------------------------- Fax: 202 942 9533 Date: February 7, 2005
-------------------------------------------------------------------------------- Phone: 202 942 2976 Pages: 26
-------------------------------------------------------------------------------- Re: China Health Holdings Inc. CC:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Urgent For Review Please Comment Please Reply Please Recycle
-------------------------------------------------------------------------------- oComments:
Ms Hartz:
At the request of our client, China Health Holdings Inc., we attach the following items:
1. Revised financial statements reflecting changes to the auditors report dealing with the restatement of the company's financial statements and a new note to the financial statements explaining the changes made - See Note 13.
2. Schedules analyzing changes to the financial statements when comparing draft 1 to draft 2 together with detailed explanations of how the company determined fair values for recording certain stock transactions. These schedules deal with the FAS 123 question concerning the fair market value of consulting services received by the company for which the company issued stock as payment.
Please do not hesitate to contact me should you have any questions concerning the attached.
Thank you
Dale Matheson Carr-Hilton labonte
Chartered Accountants Per: Peter J Donaldson, CA
cc China Health Holdings Inc.
<PAGE>
CHINA HEALTH HOLDING INC. (formerly A E&E Pharma Corporation)
(a development stage company)
FINANCIAL STATEMENTS
SEPTEMBER 30, 2004 (UNAUDITED)
DECEMBER 31, 2003 AND 2002
AUDITORS' REPORT
BALANCE SHEETS
STATEMENTS OF OPERATIONS
STATEMENT OF STOCKHOLDERS' EQUITY
STATEMENTS OF CASH FLOWS
NOTES TO FINANCIAL STATEMENTS
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Stockholders and Board of Directors of China Health Holding Inc. (formerly A E & E Pharma Corporation):
We have audited the balance sheets of China Health Holding Inc. as at December 31, 2003 and December 31, 2002, and the statements of operations, stockholders' equity and cash flows for the year ended December 31, 2003 and for the period from April 3, 2002 (inception) to December 31, 2002. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform an audit to obtain reasonable assurance whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
As described in Note 13 to the aforementioned financial statements, the accompanying financial statements as at December 31, 2003 and for the year then ended have been restated to reflect (i) an adjustment of the fair value at which certain common stock transactions have been recorded and (ii) an adjustment to the date at which certain common stock transactions were recognized. These restatements resulted in a decrease in stockholders' equity of $8,381, an increase in current liabilities of $8,381, an increase in net loss of $47,733 and no change in net loss per share
In our opinion, these financial statements, revised as described in Note 13, present fairly, in all material respects, the financial position of the Company as at, December 31, 2003 and December 31, 2002 and the results of its operations and its cash flows and the changes in stockholders' equity for the year ended December 31, 2003, and for the period from April 3, 2002 (inception) to December 31, 2002 in accordance with United States generally accepted accounting principles.
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2(a) to the financial statements, the Company has a working capital deficiency, a capital deficiency, has incurred significant losses since inception and further losses are anticipated in the development of its products raising substantial doubt about the Company's ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 2(a). The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
DALE MATHESON CARR-HILTON LABONTE CHARTERED ACCOUNTANTS Vancouver, B.C. November 10, 2004, except as to Note 13 which is as of January 31, 2005
<PAGE>
CHINA HEALTH HOLDING INC. (formerly A E&E Pharma Corporation) (a development stage company)
BALANCE SHEETS
<TABLE> <CAPTION>
Sept 30, Dec. 31, Dec. 31, 2004 2003 2002 $ $ $ (unaudited) -------------- -------------- -------------- ASSETS
<S> <C> <C> <C> <C> CURRENT ASSETS Cash 21,623 282 141 Prepaid expenses (Note 6 and 7) 426,585 772 634 -------------- -------------- -------------- 448,208 1,054 775
FIXED ASSETS (Note 4), net of amortization 5,268 2,294 -
INTANGIBLES ASSETS (Note 3) 1 - -
-------------- -------------- -------------- 453,477 3,348 775 ============== ============== ==============
LIABILITIES
CURRENT LIABILITIES Accounts payable and accrued liabilities 3,160 14,677 2,210 Due to shareholders (Note 5) 327,127 85,725 11,006 -------------- -------------- -------------- 330,287 100,402 13,216 -------------- -------------- --------------
STOCKHOLDERS' DEFICIENCY
STOCKHOLDERS' EQUITY (Note 6) Common stock, $0.001 par value, 55,000,000 shares authorized 35,452,700 (2003 - 29,165,000; 2002 - 22,895,000) shares issued and outstanding 35,453 29,165 22,895 Preferred stock, $0.001 par value, 20,000,000 shares authorized, Nil shares issued and outstanding - - - Additional paid-in capital 1,977,140 105,185 35,805 Deficit accumulated during the development stage (1,875,363) (221,346) (71,673) Accumulated other comprehensive (loss) income (14,040) (10,058) 532 -------------- -------------- -------------- 123,190 (97,054) (12,441)
453,477 3,348 775 ============== ============== ==============
GOING CONCERN (Note 1) COMMITMENTS (Note 9) </TABLE>
The accompanying notes are an integral part of these financial statements
<PAGE>
CHINA HEALTH HOLDING INC. (formerly A E&E Pharma Corporation) (a development stage company)
STATEMENTS OF OPERATIONS
<TABLE> <CAPTION>
Nine months April 3, 2002 April 3, 2002 ended Year ended (inception) to (inception) to Sept 30, 2004 Dec. 31, 2003 Dec. 31, 2002 Sept 30, 2004 $ $ $ $ (unaudited) unaudited ---------------- ---------------- ---------------- --------------
<S> <C> <C> <C> <C> PRODUCT SALES 6,495 - - 6,495 ---------------- ---------------- ---------------- --------------
EXPENSES Advertising and promotion 13,559 17,126 11,916 42,601 Amortization 652 129 - 781 Consulting fees (Note 6 and 7) 312,265 6,836 - 319,101 Interest and bank charges (Note 8) 12,891 5,840 303 19,034 Management fees (Note 6) 647,500 60,000 45,000 752,500 Office 6,960 2,156 2,817 11,933 Professional fees (Note 6) 232,234 1,428 5,410 239,072 Rent 12,172 12,359 4,727 29,258 Research and development (Note 3) 366,306 - - 366,306 Travel 5,315 161 200 5,676 Vehicle 1,361 2,530 1,300 5,191 ---------------- ---------------- ---------------- -------------- 1,611,215 108,565 71,673 1,791,453 ---------------- ---------------- ---------------- --------------
NET LOSS FROM OPERATION 1,604,720 108,565 71,673 1,784,958
LOSS ON SETTLEMENT OF DEBTS AND ISSUANCE OF SHARES (Note 7 and 12) 49,297 41,108 - 90,405 ---------------- ---------------- ---------------- --------------
NET LOSS FOR THE PERIOD 1,654,017 149,673 71,673 1,875,363 ================ ================ ================ ==============
BASIC NET LOSS PER SHARE $0.05 $0.01 $0.06 ================ ================ ================ ==============
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING 32,169,841 23,621,384 1,293,890 ================ ================ ================ ==============
</TABLE>
The accompanying notes are an integral part of these financial statements
<PAGE>
CHINA HEALTH HOLDING INC. (formerly A E&E Pharma Corporation) (a development stage company) STATEMENT OF STOCKHOLDERS' EQUITY FOR THE PERIOD FROM APRIL 3, 2002 (INCEPTION) TO SEPTEMBER 30, 2004 <TABLE> <CAPTION>
Deficit Common Stock Accumulated Accumulated Additional Dur
Show Raw Text
<DOCUMENT>
<TYPE>CORRESP
<SEQUENCE>1
<FILENAME>filename1.txt
<TEXT>
Suite 1700 - 1140 West Pender Street Dale Matheson Carr-Hilton LaBonte
Vancouver, BC Chartered Accountants
V6E 4G1
Phone: 604-687-4747
Fax: 604-687-4216
To: From: Peter J Donaldson, CA
Dana Hartz,
US Securities and Exchange Commission
--------------------------------------------------------------------------------
Fax: 202 942 9533 Date: February 7, 2005
--------------------------------------------------------------------------------
Phone: 202 942 2976 Pages: 26
--------------------------------------------------------------------------------
Re: China Health Holdings Inc. CC:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Urgent For Review Please Comment Please Reply Please Recycle
--------------------------------------------------------------------------------
oComments:
Ms Hartz:
At the request of our client, China Health Holdings Inc., we attach the
following items:
1. Revised financial statements reflecting changes to the auditors report
dealing with the restatement of the company's financial statements and
a new note to the financial statements explaining the changes made -
See Note 13.
2. Schedules analyzing changes to the financial statements when comparing
draft 1 to draft 2 together with detailed explanations of how the
company determined fair values for recording certain stock
transactions. These schedules deal with the FAS 123 question
concerning the fair market value of consulting services received by
the company for which the company issued stock as payment.
Please do not hesitate to contact me should you have any questions concerning
the attached.
Thank you
Dale Matheson Carr-Hilton labonte
Chartered Accountants
Per: Peter J Donaldson, CA
cc China Health Holdings Inc.
<PAGE>
CHINA HEALTH HOLDING INC.
(formerly A E&E Pharma Corporation)
(a development stage company)
FINANCIAL STATEMENTS
SEPTEMBER 30, 2004 (UNAUDITED)
DECEMBER 31, 2003 AND 2002
AUDITORS' REPORT
BALANCE SHEETS
STATEMENTS OF OPERATIONS
STATEMENT OF STOCKHOLDERS' EQUITY
STATEMENTS OF CASH FLOWS
NOTES TO FINANCIAL STATEMENTS
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Stockholders and Board of Directors of China Health Holding Inc.
(formerly A E & E Pharma Corporation):
We have audited the balance sheets of China Health Holding Inc. as at December
31, 2003 and December 31, 2002, and the statements of operations, stockholders'
equity and cash flows for the year ended December 31, 2003 and for the period
from April 3, 2002 (inception) to December 31, 2002. These financial statements
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform an audit to obtain reasonable assurance whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
As described in Note 13 to the aforementioned financial statements, the
accompanying financial statements as at December 31, 2003 and for the year then
ended have been restated to reflect (i) an adjustment of the fair value at which
certain common stock transactions have been recorded and (ii) an adjustment to
the date at which certain common stock transactions were recognized. These
restatements resulted in a decrease in stockholders' equity of $8,381, an
increase in current liabilities of $8,381, an increase in net loss of $47,733
and no change in net loss per share
In our opinion, these financial statements, revised as described in Note 13,
present fairly, in all material respects, the financial position of the Company
as at, December 31, 2003 and December 31, 2002 and the results of its operations
and its cash flows and the changes in stockholders' equity for the year ended
December 31, 2003, and for the period from April 3, 2002 (inception) to December
31, 2002 in accordance with United States generally accepted accounting
principles.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 2(a) to the
financial statements, the Company has a working capital deficiency, a capital
deficiency, has incurred significant losses since inception and further losses
are anticipated in the development of its products raising substantial doubt
about the Company's ability to continue as a going concern. Management's plans
in regard to these matters are also described in Note 2(a). The financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.
DALE MATHESON CARR-HILTON LABONTE
CHARTERED ACCOUNTANTS
Vancouver, B.C.
November 10, 2004, except as to Note 13 which is as of January 31, 2005
<PAGE>
CHINA HEALTH HOLDING INC.
(formerly A E&E Pharma Corporation)
(a development stage company)
BALANCE SHEETS
<TABLE>
<CAPTION>
Sept 30, Dec. 31, Dec. 31,
2004 2003 2002
$ $ $
(unaudited)
-------------- -------------- --------------
ASSETS
<S> <C> <C> <C> <C>
CURRENT ASSETS
Cash 21,623 282 141
Prepaid expenses (Note 6 and 7) 426,585 772 634
-------------- -------------- --------------
448,208 1,054 775
FIXED ASSETS (Note 4), net of amortization 5,268 2,294 -
INTANGIBLES ASSETS (Note 3) 1 - -
-------------- -------------- --------------
453,477 3,348 775
============== ============== ==============
LIABILITIES
CURRENT LIABILITIES
Accounts payable and accrued liabilities 3,160 14,677 2,210
Due to shareholders (Note 5) 327,127 85,725 11,006
-------------- -------------- --------------
330,287 100,402 13,216
-------------- -------------- --------------
STOCKHOLDERS' DEFICIENCY
STOCKHOLDERS' EQUITY (Note 6)
Common stock, $0.001 par value, 55,000,000 shares authorized 35,452,700
(2003 - 29,165,000; 2002 - 22,895,000) shares
issued and outstanding 35,453 29,165 22,895
Preferred stock, $0.001 par value, 20,000,000 shares authorized,
Nil shares issued and outstanding - - -
Additional paid-in capital 1,977,140 105,185 35,805
Deficit accumulated during the development stage (1,875,363) (221,346) (71,673)
Accumulated other comprehensive (loss) income (14,040) (10,058) 532
-------------- -------------- --------------
123,190 (97,054) (12,441)
453,477 3,348 775
============== ============== ==============
GOING CONCERN (Note 1)
COMMITMENTS (Note 9)
</TABLE>
The accompanying notes are an integral part of these financial statements
<PAGE>
CHINA HEALTH HOLDING INC.
(formerly A E&E Pharma Corporation)
(a development stage company)
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
Nine months April 3, 2002 April 3, 2002
ended Year ended (inception) to (inception) to
Sept 30, 2004 Dec. 31, 2003 Dec. 31, 2002 Sept 30, 2004
$ $ $ $
(unaudited) unaudited
---------------- ---------------- ---------------- --------------
<S> <C> <C> <C> <C>
PRODUCT SALES 6,495 - - 6,495
---------------- ---------------- ---------------- --------------
EXPENSES
Advertising and promotion 13,559 17,126 11,916 42,601
Amortization 652 129 - 781
Consulting fees (Note 6 and 7) 312,265 6,836 - 319,101
Interest and bank charges (Note 8) 12,891 5,840 303 19,034
Management fees (Note 6) 647,500 60,000 45,000 752,500
Office 6,960 2,156 2,817 11,933
Professional fees (Note 6) 232,234 1,428 5,410 239,072
Rent 12,172 12,359 4,727 29,258
Research and development (Note 3) 366,306 - - 366,306
Travel 5,315 161 200 5,676
Vehicle 1,361 2,530 1,300 5,191
---------------- ---------------- ---------------- --------------
1,611,215 108,565 71,673 1,791,453
---------------- ---------------- ---------------- --------------
NET LOSS FROM OPERATION 1,604,720 108,565 71,673 1,784,958
LOSS ON SETTLEMENT OF DEBTS AND
ISSUANCE OF SHARES (Note 7 and 12) 49,297 41,108 - 90,405
---------------- ---------------- ---------------- --------------
NET LOSS FOR THE PERIOD 1,654,017 149,673 71,673 1,875,363
================ ================ ================ ==============
BASIC NET LOSS PER SHARE $0.05 $0.01 $0.06
================ ================ ================ ==============
WEIGHTED AVERAGE COMMON SHARES
OUTSTANDING 32,169,841 23,621,384 1,293,890
================ ================ ================ ==============
</TABLE>
The accompanying notes are an integral part of these financial statements
<PAGE>
CHINA HEALTH HOLDING INC.
(formerly A E&E Pharma Corporation)
(a development stage company)
STATEMENT OF STOCKHOLDERS' EQUITY
FOR THE PERIOD FROM APRIL 3, 2002 (INCEPTION) TO SEPTEMBER 30, 2004
<TABLE>
<CAPTION>
Deficit
Common Stock Accumulated Accumulated
Additional Dur