Paranovus Entertainment Technology .(PAVS) - 2021 Q4 - Annual Report

Financial Performance - For the fiscal year ended March 31, 2021, the company generated revenue of $71,484,703, representing an increase of 9.9$65,061,953 for the fiscal year ended March 31, 2020[280]. - The net income for the fiscal year ended March 31, 2021, was $691,956, a significant decrease of 94.5$12,688,035 in the previous fiscal year[280]. - Revenues for the fiscal year ended March 31, 2021 were $71,484,703, an increase of$6,422,750 or 9.9% compared to $65,061,953 for the fiscal year ended March 31, 2020[297]. - Sales from healthcare products dropped significantly from$65,061,953 in fiscal year 2020 to $45,389,702 in fiscal year 2021 due to COVID-19 impacts[298]. - Operating income decreased by$13,873,001 or approximately 90.1% to $1,525,716 for the fiscal year ended March 31, 2021[306]. - Net income for the fiscal year ended March 31, 2021 was$691,956, a decrease of $11,996,079 or 94.5$12,688,035 for the fiscal year ended March 31, 2020[312]. Sales and Distribution - The company has over 100 distributors and 17 experience stores across 18 provinces in China, enhancing its market presence[278]. - Online sales have been a growing distribution channel since the launch of the "Happy Buy" platform in September 2020, capitalizing on the rapid expansion of live streaming e-commerce in China[278]. - The automobile sales platform "Taochejun" was launched in November 2020, focusing on small cities and new energy vehicles, leveraging a network of car dealers[279]. - Online store sales generated $13,473,626 in revenue for the fiscal year ended March 31, 2021, marking a successful entry into e-commerce[299]. Cost and Expenses - Total cost of revenues increased by$18,666,453 or 53.9% to $53,309,102 for the fiscal year ended March 31, 2021, resulting in a gross margin ratio of 25.4$779,726 or 8.5% to $9,958,886 for the fiscal year ended March 31, 2021[303]. - General and administrative expenses rose by$1,548,440 or 44.5% to $5,030,899 for the fiscal year ended March 31, 2021[304]. - Research and development expenses decreased by$698,868 or 29.6% to $1,660,100 for the fiscal year ended March 31, 2021[305]. - The gross margin ratio of online sales was 5.3$2.9 million for the year ended March 31, 2021, down from approximately $10.8 million for the year ended March 31, 2020[330]. - Net cash used in investing activities was$13,222,847 for the year ended March 31, 2021, compared to $1,159,355 for the previous year[334]. - Capital expenditures amounted to$3,834,578 for the year ended March 31, 2021, compared to $1,159,355 for the year ended March 31, 2020[337]. - As of March 31, 2021, cash and cash equivalents were$36,558,752, an increase from $33,654,765 as of March 31, 2020[329]. Internal Control and Compliance - As of March 31, 2021, the company's internal control over financial reporting was deemed ineffective due to insufficient knowledge of U.S. GAAP and SEC reporting requirements[485]. - Material weaknesses identified include inadequate procedures for identifying related party transactions[485]. - The company plans to recruit qualified professionals to address accounting issues in complex transactions[486]. - Investment in technology infrastructure is planned to enhance the financial reporting function[486]. - Improved communication between management, the board of directors, and the chief financial officer is a priority[486]. - No changes in internal control over financial reporting occurred during the reporting period that materially affected internal controls[487].