UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
  
Form 10-Q
  
☒     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the quarterly period ended March 31, 2017
 
or
 
☐     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the Transition Period from                 to                .
 
Commission File Number 000-54485
 
IONIX TECHNOLOGY, INC.
(Exact name of registrant as specified in its charter)
 
Nevada
 
 
45-0713638
(State or other jurisdiction of
incorporation or organization)
 
(I.R.S. Employer
Identification No.)
 
Chengdong Industrial Park, Fenyi County, Xinyu City, Jiangxi Province, China 338000
(Address of principal executive offices) (Zip Code)

  (702) 475-5906
(Registrant’s telephone number, including area code)

___________________________
(Former name, former address and former fiscal year, if changed since last report)
 
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes  ☒  No  ☐ .
 
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes  ☒  No  ☐
 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one)
 
Large accelerated filer  ☐
Accelerated filer  ☐
Non-accelerated filer  ☐
Smaller reporting company  ☒
Emerging growth company  ☐
 
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
   
  
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes  ☐  No  ☒ .
 
As of May 16, 2017, there were 99,003,000 shares of common stock issued and outstanding, par value $0.0001 per share.
 
As of May 16, 2017 , there were 5,000,000 shares of preferred stock issued and outstanding, par value $0.0001 per share.
 
 
 
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
 
Certain information included in this Quarterly Report on Form 10-Q and other filings of the Registrant under the Securities Act of 1933, as amended (the “Securities Act”), and the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as well as information communicated orally or in writing between the dates of such filings, contains or may contain “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. Forward-looking statements in this Quarterly Report on Form 10-Q, including without limitation, statements related to our plans, strategies, objectives, expectations, intentions and adequacy of resources, are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements are subject to certain risks, trends and uncertainties that could cause actual results to differ materially from expected results. Among these risks, trends and uncertainties are the availability of working capital to fund our operations, the competitive market in which we operate, the efficient and uninterrupted operation of our computer and communications systems, our ability to generate a profit and execute our business plan, the retention of key personnel, our ability to protect and defend our intellectual property, the effects of governmental regulation, and other risks identified in the Registrant’s filings with the Securities and Exchange Commission from time to time.
 
In some cases, forward-looking statements can be identified by terminology such as “may,” “will,” “should,” “could,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential” or “continue” or the negative of such terms or other comparable terminology. Although the Registrant believes that the expectations reflected in the forward-looking statements contained herein are reasonable, the Registrant cannot guarantee future results, levels of activity, performance or achievements. Moreover, neither the Registrant, nor any other person, assumes responsibility for the accuracy and completeness of such statements. The Registrant is under no duty to update any of the forward-looking statements contained herein after the date of this Quarterly Report on Form 10-Q.
 
 
IONIX TECHNOLOGY, INC.
FORM 10-Q
MARCH 31, 2017
 
 
INDEX
 
 
 
Page
Part I – Financial Information
F-1
 
 
 
Item 1.
Financial Statements
F-1
Item 2.
Management’s Discussion and Analysis of Financial Condition and Results of Operation
13
Item 3.
Quantitative and Qualitative Disclosures about Market Risk
16
Item 4.
Controls and Procedures
16
Item 4T.
Controls and Procedures
16
 
 
 
Part II – Other Information
16
 
 
 
Item 1.
Legal Proceedings
16
Item 1A.
Risk Factors
17
Item 2.
Unregistered Sales of Equity Securities and Use of Proceeds
17
Item 3.
Defaults Upon Senior Securities
17
Item 4.
Mine Safety Disclosures
17
Item 5.
Other Information
17
Item 6.
Exhibits
18
 
 
 
Signatures
19
 
 
 
Certifications
 
 
 
PART I – FINANCIAL INFORMATION
 
Item 1. Financial Statements .
 
 
INDEX
F-1
Consolidated Balance Sheets as of March 31, 2017 and June 30, 2016 (Unaudited)
F-2
Consolidated Statements of Comprehensive Income (Loss) for the Three and Nine Months Ended March 31,
2017 and 2016 (Unaudited)
F-3
Consolidated Statements of Cash Flows for the Nine Months Ended March 31, 2017 and 2016
(Unaudited)
F-4
Notes to Consolidated Financial Statements (Unaudited)
F-5
 
F-1
 
IONIX TECHNOLOGY,  INC.
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)

 
 
March 31,
2017
   
June 30,
2016
 
ASSETS
           
 
           
Current Asset:
           
Cash
 
$
102,500
   
$
59,758
 
Inventory
   
1,353,079
     
-
 
Account receivables
   
59,579
     
-
 
Advances to suppliers
   
467,787
     
-
 
Prepaid expenses and other current assets
   
4,169
     
103
 
Current assets of discontinued operation
   
-
     
2,129,360
 
Total current assets
   
1,987,114
     
2,189,221
 
Total Assets
 
$
1,987,114
   
$
2,189,221
 
 
               
LIABILITIES AND STOCKHOLDERS’ EQUITY
               
 
               
Current Liabilities:
               
Accounts payable-- non-related parties
 
$
133,459
   
$
-
 
- related parties
   
619,471
     
-
 
Advance from customers
   
116,245
     
-
 
Due to related parties
   
1,069,989
     
53,510
 
Accrued expenses and other current liabilities
   
29,409
     
9,080
 
Current liabilities of discontinued operation
   
-
     
2,113,533
 
Total Current Liabilities
   
1,968,573
     
2,176,123
 
 
               
COMMITMENT AND CONTINGENCIES
               
 
               
Stockholders’ Equity :
               
                 
Preferred stock,5,000,000 shares authorized,
$.0001 par value; 5,000,000  shares issued and outstanding
   
500
     
500
 
Common stock, 195,000,000 shares authorized,
$.0001 par value; 99,003,000 shares issued and outstanding
   
9,900
     
9,900
 
Additional paid in capital
   
261,610
     
237,246
 
Accumulated deficit
   
(250,763
)
   
(234,903
)
Accumulated other comprehensive income ( loss)
   
(2,706
)
   
355
 
Total Stockholders’ Equity
   
18,541
     
13,098
 
 
               
Total Liabilities and Stockholders’ Equity
 
$
1,987,114
   
$
2,189,221
 
 
  The accompanying notes are an integral part of these consolidated financial statements.
 
F-2
 
IONIX TECHNOLOGY, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(UNAUDITED)

 
 
 
For the nine months ended
March 31,
   
For the three months ended
March 31,
 
             
   
2017
   
2016
   
2017
   
2016
 
 
       
(Restated)
           
Revenue
 
$
4,984,296
   
$
-
   
$
2,009,957
   
$
-
 
                                 
  Cost of revenues- Non-related parties
   
1,602,007
 
   
-
     
447,669
 
   
-
 
- Related parties
   
3,044,012
 
   
-
     
1,462,923
 
   
-
 
  Total cost of revenues     4,646,019      
-
      1,910,592      
-
 
                                 
Gross profit
   
338,277
     
-
     
99,365
     
-
 
Expenses:
                               
Selling, general and administrative
   
292,146
     
15,712
     
80,997
     
15,712
 
 
                               
Total operating expenses
   
292,146
     
15,712
     
80,997
     
15,712
 
                                 
Income (loss) from continuing operations before income tax
   
46,131
     
(15,712
)
   
18,368
     
(15,712
)
                                 
Income tax
   
26,892
     
-
     
2,314
     
-
 
                                 
Income( loss) from continuing operations
   
19,239
     
(15,712
)
   
16,054
     
(15,712
)
 
                               
  Income (loss) from discontinued operations
   
(35,099
)
   
6,758
     
-
     
17,297
 
Net income (loss)
   
(15,860
)
   
(8,954
)
   
16,054
     
1,585
 
                                 
  Other comprehensive income ( loss)
                               
Foreign currency translation adjustment
   
(3,061
)
   
243
     
(5,079
)
   
243
 
                                 
Comprehensive income (loss)
 
$
(18,921
)
 
$
(8,711
)
 
$
10,975
   
$
1,828
 
                                 
Income/ loss Per Share -
                               
Basic and Diluted-continuing operation
 
$
-
   
$
-
   
$
-
   
$
-
 
             -discontinued operation
 
$
-
   
$
-
   
$
-
   
$
-
 
Weighted average number of common shares outstanding-
Basic and Diluted
   
99,003,000
     
99,003,000
     
99,003,000
     
99,003,000
 
 
The accompanying notes are an integral part of these consolidated financial statements.
 
F-3
 
IONIX TECHNOLOGY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)

 
   
For the nine months ended
 
 
 
March 31,
2017
   
March 31,
2016
 
CASH FLOWS FROM OPERATIONS:
           
Net loss
 
$
(15,860
)
 
$
(8,954
)
Net income ( loss) from discontinued operation
   
(35,099
)
   
6,758
 
Net income ( loss) from continuing operation
   
19,239
     
(15,712
)
Adjustments required to reconcile net loss to net cash used in operating activities:
               
Changes in assets and liabilities:
               
Increases in advance to suppliers
   
(477,872
)
   
-
 
Increases in accounts receivable
   
(60,863
)
   
-
 
Increases in inventory
   
(1,382,249
)
   
-
 
Increases in prepaid expense
   
(4,066
)
   
-
 
Increases in accounts payable
   
769,163
     
-
 
Increase in advance from customers
   
118,749
     
-
 
Increase in accrued expense
   
20,873
     
3,939
 
                 
      Net cash used in continuing operation
   
(997,026
)
   
(11,773
)
      Net cash used in discontinued operation
   
-
     
(18,282
)
      Net cash used in operating activities
   
(997,026
)
   
(30,055
)
                 
CASH FLOWS FROM FINANCING ACTIVITIES
               
  Proceeds from loans from related parties
   
1,037,060
     
46,899
 
  Issuance of preferred shares
   
-
     
50,000
 
Net cash provided by continuing operation
   
1,037,060
     
96,899
 
Net cash provided by discontinued operation
   
-
     
13,983
 
Net cash provided by financing activities
   
1,037,060
     
110,882
 
                 
 Effect of exchange rate changes on cash
   
2,708
     
243
 
                 
Net increase in cash
   
42,742
     
81,070
 
 
               
Cash, beginning of period
   
59,758
     
691
 
 
               
Cash, end of period
 
$
102,500
   
$
81,761
 
 
               
Supplemental disclosure of cash flow information:
               
Cash paid for income tax
 
$
28,000
   
$
-
 
Cash paid for interest
   
-
     
-
 
 
The accompanying notes are an integral part of these consolidated financial statements.
 
F-4
 
IONIX TECHNOLOGY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2017
(UNAUDITED)

NOTE 1- NATURE OF OPERATIONS
 
Ionix Technology, Inc. (the “Company” or “Ionix”), formerly known as Cambridge Projects Inc., is a Nevada corporation that was formed on March 11, 2011.  By and through its wholly owned subsidiaries in China, the Company develops, designs, manufactures and sells lithium batteries for electric vehicles in China. Ionix also sells the High-end intelligent electronic equipment, which includes portable power packs for electronic devices and LCD screens in China. In September 2016, we commenced our business and started to generate revenue from the sale of the power banks and LCD screens in the PRC.
      
On May 19, 2016, the Company, as the sole member of Well Best International Investment Limited (“Well Best”), formed Xinyu Ionix Technology Company Limited (“Xinyu Ionix”), a company formed under the laws of China. As a result, Xinyu Ionix is a wholly-owned subsidiary of Well Best and an indirect wholly-owned subsidiary of the Company. Xinyu Ionix started operation in August 2016 and will focus on developing and designing lithium batteries as well as to act as an investment company that may acquire other businesses located in China.

On November 7, 2016, the Company’s Board of Directors approved and ratified the incorporation of Lisite Science Technology (Shenzhen) Co., Ltd (“Lisite Science”), a limited liability company formed in China on June 20, 2016. Well Best is the sole shareholder of Lisite Science. As a result, Lisite Science is an indirect, wholly-owned subsidiary of the Company. Lisite Science will act as a manufacturing base for the Company and shall focus on developing and producing high-end intelligent electronic equipment.

On November 7, 2016, the Company’s Board of Directors approved and ratified the incorporation of Shenzhen Baileqi Electronic Technology Co., Ltd. (“Baileqi Electronic”), a limited liability company formed in China on August 8, 2016. Well Best is the sole shareholder of Baileqi Electronic. As a result, Baileqi Electronic is an indirect, wholly-owned subsidiary of the Company. Baileqi Electronic will act as a manufacturing base for the Company and shall focus on development and production of the LCD and module for civil electronic products.

On December 29, 2016, the Company’s Board of Directors approved and ratified to invest 99,999 HK dollars for 99.999% of the issued and outstanding stock of Welly Surplus International Limited (“Welly Surplus”), a limited company formed under the laws of Hong Kong on January 18, 2016. As a result of the investment, the Company became the majority shareholder of Welly Surplus, owning 99.999% of the outstanding stock of Welly Surplus, Mr Xin Sui, a director, owns 0.001% of the outstanding stock of Welly Surplus. Welly Surplus will act as the accounting and financial base for the Company and shall focus on assisting the Company with all of the Company’s financial affairs. Welly surplus had no activities since inception.
 
NOTE 2 –GOING CONCERN

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. The Company had an accumulated deficit of $250,763 as of March 31, 2017 and has not generated cash flow from its operations for past two years. These circumstances, among others, raise substantial doubt about the Company’s ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

  The Company expects to continue incurring losses for the foreseeable future and may need to raise additional capital from external sources or obtain loans from officers and shareholders in order to continue the long-term efforts contemplated under its business plan. The Company is in the process of reevaluating its current marketing strategy as it relates to the sale of its current product line. In addition, the Company is pursuing other revenue streams which could include strategic acquisitions or possible joint ventures of other business segments.
 
F-5

NOTE 3 –SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation

The unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and the rules and regulations of the Securities and Exchange Commission. In the opinion of management, the unaudited financial statements have been prepared on the same basis as the annual financial statements and reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the financial position as of March 31, 2017 and the results of operations and cash flows for the periods ended March 31, 2017 and 2016. The financial data and other information disclosed in these notes to the interim financial statements related to these periods are unaudited. The results for the three and nine months ended March 31, 2017 are not necessarily indicative of the results to be expected for any subsequent periods or for the entire year ending June 30, 2017 or for any subsequent periods. The balance sheet at June 30, 2016 has been derived from the audited financial statements at that date.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted pursuant to the Securities and Exchange Commission's rules and regulations. These unaudited financial statements should be read in conjunction with our audited financial statements and notes thereto for the year ended June 30, 2016 as included in our Annual Report on Form 10-K as filed with the SEC on October 11, 2016.

Certain amounts have been reclassified to conform to current year presentation

Impairment of long-lived assets
 
In accordance with the provisions of ASC Topic 360, “Impairment or Disposal of Long-Lived Assets”, all long-lived assets such as property, plant and equipment held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is evaluated by a comparison of the carrying amount of an asset to its estimated future undiscounted cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amounts of the assets exceed the fair value of the assets.

Revenue recognition
 
In accordance with the ASC Topic 605, “Revenue Recognition”, the Company recognizes revenue when persuasive evidence of an arrangement exists, transfer of title has occurred or services have been rendered, the selling price is fixed or determinable and collectability is reasonably assured.

The Company recognizes revenue from the sale of finished products upon delivery to the customer, whereas the title and risk of loss are fully transferred to the customers. The Company records its revenues, net of value added taxes (“VAT”). The Company is subject to VAT which is levied on the majority of the products at the rate of 17% on the invoiced value of sales.
 
Foreign currencies translation
 
Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the statement of comprehensive income (loss).
 
The reporting currency of the Company is the United States Dollar ("US$"). The Company's subsidiaries in the People’s Republic of China (“PRC”) maintain their books and records in their local currency, the Renminbi Yuan ("RMB"), which is the functional currency as being the primary currency of the economic environment in which these entities operate.
 
In general, for consolidation purposes, assets and liabilities of its subsidiaries whose functional currency is not the US$ are translated into US$, in accordance with ASC Topic 830-30, “Translation of Financial Statement”, using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. Stockholders’ equity is translated at historical rates. The gains and losses resulting from translation of financial statements of foreign subsidiaries are recorded as a separate component of accumulated other comprehensive income within the statement of stockholders’ equity.
 
F-6

The exchange rates used to translate amounts in RMB into U.S. Dollars for the purposes of preparing the consolidated financial statements are as follows:

   
March 31, 2017
   
March 31, 2016
 
             
Balance sheet items, except for equity accounts
   
6.8993
     
6.4493
 
                 
Items in statements of comprehensive income (loss) and
cash flows
   
6.7537
     
6.5398
 

Fair Value of Financial Instruments
 
The carrying value of the Company’s financial instruments: cash and cash equivalents, accounts and retention receivable, prepayments and other receivables, accounts payable, income tax payable, other payables and accrued liabilities approximate at their fair values because of the short-term nature of these financial instruments.
 
Management believes, based on the current market prices or interest rates for similar debt instruments, the fair value of short-term bank borrowings and note payable approximate the carrying amount.
 
The Company also follows the guidance of the ASC Topic 820-10, “Fair Value Measurements and Disclosures” ("ASC 820-10"), with respect to financial assets and liabilities that are measured at fair value. ASC 820-10 establishes a three-tier fair value hierarchy that prioritizes the inputs used in measuring fair value as follows:
 
Level 1: Inputs are based upon unadjusted quoted prices for identical instruments traded in active markets;
 
Level 2: Inputs are based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques (e.g. Black-Scholes Option-Pricing model) for which all significant inputs are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Where applicable, these models project future cash flows and discount the future amounts to a present value using market-based observable inputs; and
 
Level 3: Inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques, including option pricing models and discounted cash flow models.
 
Fair value estimates are made at a specific point in time based on relevant market information about the financial instrument. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates.
 
The Company has no financial instruments measured at fair value on a recurring basis.

Recent Accounting Pronouncements
 
From time to time, new accounting pronouncements are issues by the Financial Accounting Standards Board or other standard bodies that may have an impact on the Company’s accounting and reporting. The Company believes that any recently issued accounting pronouncements and other authoritative guidance for which the effective date is in the future either will not have an impact on its accounting or reporting or that such impact will not be material to its financial position, results of operations, and cash flows when implemented.
         
NOTE 4– DISCONTINUED OPERATIONS

QI System

On February 8, 2012, the Company obtained exclusive licensing rights of the QI System from Quadra International Inc. (“Quadra”), the manufacturer of the QI System, to sub-license, establish joint ventures to commercialize, use and process organic waste, and sell related by-products in the states of Johore and Selangor, Malaysia for a period of 25 years.  The QI System processes organic waste to marketable by-products and is proprietary technology. This business was terminated on November 15, 2015.The Company has excluded results of QI system operations from its continuing operations to present this business in discontinued operations.

The following table shows the results of operations for fiscal quarters ended March 31, 2017 and 2016 which are included in the loss from discontinued operations for the termination of QI System:

   
For the nine months
ended
March 31,
   
For the three months
ended
March 31,
 
   
2017
   
2016
   
2017
   
2016
 
Revenue
 
$
-
   
$
-
   
$
-
   
$
-
 
Cost of revenue
   
-
     
-
     
-
     
-
 
Gross profit
   
-
     
-
     
-
     
-
 
Selling, general and administrative expenses
   
-
     
10,539
     
-
     
-
 
Loss before income taxes
   
-
     
(10,539
)
   
-
     
-
 
Provision for income taxes
   
-
     
-
     
-
     
-
 
Net loss
 
$
-
   
$
(10,539
)
 
$
-
   
$
-
 
 
F-7
 
Taizhou Ionix

On August 19, 2016, Well Best entered into a share transfer agreement whereby Well Best sold 100% of its equity interest in Taizhou Ionix Technology Co. Ltd. (“Taizhou Ionix”) to Mr. GuoEn Li, the sole director and officer of Taizhou Ionix  for   approximately RMB 30,000 (approximately $5,000USD). Well Best was the sole shareholder of Taizhou Ionix. The Company believed that the manufacturing contract between Taizhou Ionix and Taizhou Jiunuojie Electronic Technology Limited regarding the production of lithium batteries was not beneficial to the Company. As a result, (i) Taizhou is no longer an indirect, wholly-owned subsidiary of the Company, and (ii) Mr. Li is no longer affiliated with the Company. Well Best recorded a gain of $24,364 on disposal of Taizhou Ionix which was recorded in the account of  additional paid in capital.

The following table shows the results of operations for the nine months ended March 31, 2017 and 2016 which are included in the loss from discontinued operations for the disposal of Taizhou Ionix:
 
   
For the period from
July 1 to
August 19, 2016
   
For the nine months
ended
March 31 , 2016
 
Revenue
 
$
502,003
   
$
281,550
 
Cost of revenue
   
(505,401
)
   
(253,121
)
Gross profit (Loss)
   
(3,389
)
   
28,429
 
Selling, general and administrative expenses
   
31,701
     
5,366
 
Income (Loss) before income taxes
   
(35,099
)
   
23,063
 
Provision for income taxes
   
-
     
5,766
 
Net Income (Loss)
 
$
( 35,099
)
 
$
17,297
 
  
NOTE 5-INVENTORIES

Inventories are stated at the lower of cost (determined using the weighted average cost) or market value and are composed of the following:

   
March 31 ,
 
   
2017
   
2016
 
             
Raw materials
 
$
1,206,496
   
$
-
 
Finished goods
   
146,583
     
-
 
   
$
1,353,079
   
$
-
 

NOTE 6 -DUE FROM/TO RELATED PARTIES
 
Manufacture – related party
 
On September 1, 2016, Baileqi entered into a manufacturing agreement with Shenzhen Baileqi Science and Technology Co., Ltd. (“Shenzhen Baileqi S&T”) to manufacture products for Baileqi. The owner of Shenzhen Baileqi S&T is also a shareholder of the Company who owns approximately 1.5% of the Company’s outstanding common stock as of March 31, 2017.  Baileqi made payments to Shenzhen Baileqi S&T for manufacturing cost. The manufacturing costs incurred with Shenzhen Baileqi S&T was $158,180 for the nine months ended March 31, 2017 and was included in cost of revenue.
 
F-8

Purchase from related party
 
During the nine months ended March 31, 2017, the Company purchased $2,668,927 and $265,517 from two related companies which were owned by the Company’s shareholders who own approximately 2% and 1.5% respectively of the Company’s outstanding common stock as of March 31, 2017. The amount of $2,620,315 and $265,517 were included in the cost of revenue.  The balance payable to these two related parties were $577,741 and $41,730 respectively as of March 31, 2017.

Due to related parties
 
Due to related parties represents certain advances to the company or its subsidiaries by related parties. The amounts are non-interest bearing, unsecured and due on demand.

Due to related parties consists of the following:
 
 
 
March 31, 2017
   
June 30, 2016
 
Ben Wong
 
$
108,384
   
$
53,510
 
Changyong Yang
   
898,546
     
-
 
Xin Sui
   
6,992
     
-
 
Zhengfu Nan
   
56,067
     
-
 
   
$
1,069,989
   
$
53,510
 

During the year ended June 30, 2016, Ben Wong, the controlling shareholder of Shinning Glory which holds majority shares in Ionix Technology, Inc., advanced $15,770 to the Company, $37,740 to Well best.

During the nine months ended March 31, 2017, Ben Wong advanced $54,874 to Well Best. Changyong Yang, a shareholder of the Company, advanced $898,546 to Lisite Science.  Xin Sui, a member of the board of directors of Welly Surplus, advanced $6,992 to Welly Surplus.

During the three months ended September 30, 2016, Xinyu Ionix advanced approximately $913,000 to Mr. Zhengfu Nan, a director and a general manager of Xinyu Ionix, to make payments to suppliers of Xinyu Ionix on behalf of Xinyu Ionix.  There was no formal agreement between the Company and Mr. Nan. The amounts are non-interest bearing, unsecured and due on demand. During the nine months ended March 31, 2017, Mr. Nan made payments to suppliers of Xinyu Ionix for approximately $913,000 for settlement of account payable on behalf of Xinyu Ionix and advanced $56,067 to Xinyu Ionix.

NOTE 7– CONCENTRATION OF RISKS

Major customers

For the nine months ended March 31, 2017 , customers who accounted for 10% or more of the Company’s revenues and its outstanding balance as of March 31, 2017 are presented as follows:

   
Revenue
   
Percentage of
revenue
   
Accounts
receivable
   
Percentage of
accounts
receivable
 
                         
Customer A
 
$
2,653,960
     
53%
 
 
$
59,571
     
100%
 
Customer B
   
683,472
     
14%
 
   
-
     
-%
 
Total
 
$
3,337,432
     
67%
 
 
$
59,571
     
100%
 
 
F-9
 
All customers are located in the PRC.

Major suppliers

For the nine months ended March 31, 2017, the supplier who accounted for 10% or more of the Company’s total purchases (materials and services) and its outstanding balance as of March 31, 2017 is presented as follows:

   
Total Purchase
   
Percentage of
total purchase
   
Accounts
payable
   
Percentage of
accounts
payable
 
                         
Supplier A
 
$
2,668,927
     
41%
 
 
$
577,741
     
77%
 
Total
 
$
2,668,927
     
41%
 
 
$
577,741
     
77%
 

   
All suppliers of the Company are located in the PRC.

NOTE 8- INCOME TAXES
 
The effective tax rate in the years presented is the result of the mix of income earned in various tax jurisdictions that apply a broad range of income tax rate. The Company operates in various countries: United States of America Hong Kong and the PRC that are subject to taxes in the jurisdictions in which they operate, as follows:

United States of America

The Company is registered in the State of Nevada and is subject to the tax laws of United States of America.

The Company has shown losses since inception.  As a result it has incurred no income tax. Under normal circumstances, the Internal Revenue Service is authorized to audit income tax returns during a three year period after the returns are filed.  In unusual circumstances, the period may be longer.  Tax returns for the years ended June 30, 2011 to 2014 were still exposed to audit as of March 31, 2017 .

The Company received a penalty assessment from the IRS in the amount of $10,000 for failure to provide information with respect to certain foreign owned US Corporations on Form 5472 - Information Return of a 25% Foreign Owned US Corporation for the tax period ended June 30, 2013. The Company disputed this claim and is working to reverse the penalty. The Company believes that the payment of this penalty is remote and did not accrue this liability as of March 31, 2017.

Hong Kong

The Well Best is registered in Hong Kong and for the nine months ended March 31, 2017, there is no assessable income chargeable to profit tax in Hong Kong.
 
The PRC

Taizhou Ionix is operating in the PRC and is subject to the Corporate Income Tax Law of the People’s Republic of China at a unified income tax rate of 25%.

The reconciliation of income tax expense at the U.S. statutory rate of 35% to the Company's effective tax rate is as follows:

   
For the nine months ended March 31
 
   
2017
   
2016
 
             
U.S. Statutory rate
 
$
(3,137
)
 
$
(9,188
)
Tax rate difference between
China and U.S.
   
10,209
     
-
 
Change in Valuation Allowance
   
19,82 0
     
9,188
 
Effective tax rate
 
$
26,892
   
$
-
 
 
F-10
 
The provisions for income taxes are summarized as follows:
 
For the nine months ended March 31 ,
 
   
2017
   
2016
 
Current
 
$
26,892
   
$
-
 
Deferred
   
-
     
-
 
Total
 
$
26,892
   
$
-
 

The Company has not provided deferred taxes on unremitted earnings attributable to international companies that have been considered to be reinvested indefinitely. Because of the availability of U.S. foreign tax credits, it is not practicable to determine the income tax liability that would be payable if such earnings were not indefinitely reinvested. In accordance with ASC Topic 740, interest associated with unrecognized tax benefits is classified as income tax and penalties are classified in selling, general and administrative expenses in the statements of operations.

The extent of the Company’s operations involves dealing with uncertainties and judgments in the application of complex tax regulations in a multitude of jurisdictions. The final taxes paid are dependent upon many factors, including negotiations with taxing authorities in various jurisdictions and resolution of disputes arising from federal, state and international tax audits. The Company recognizes potential liabilities and records tax liabilities for anticipated tax audit issues in the United States and other tax jurisdictions based on its estimate of whether, and the extent to which, additional taxes will be due.

NOTE 9– STOCKHOLDERS’ EQUITY

On August 19, 2016, Well Best sold 100% of its ownership in Taizhou Ionix to Mr. GuoEn Li, the sole director and officer of Taizhou Ionix for RMB30,000 (approximately $5,000) and recorded a gain of $24,364 which was recorded in the account of additional paid in capital. See Note 4 for more details.

NOTE 1 0 – RESTATEMENT

The management of the Company has concluded that we should restate our financial statements for the nine months ended March 31, 2016 due to the restatement of the year ended on June 30, 2015.

The effect of the restatement on specific line items in the financial statements for the nine months ended March 31, 2016 is set forth in the table below:
  
   
Consolidated Statement of Comprehensive Loss
 
   
for the nine months ended March 31, 2016
 
   
Previously
             
   
Reported
   
Adjustments
   
As Adjusted
 
                   
Operating expenses
 
$
(119,071
)
 
$
129,610
   
$
10,539
 
Income (loss) before income tax
 
$
119,071
   
$
(129,610
)
 
$
(10,539
)
Net income (loss)
 
$
119,071
   
$
(129,610
)
 
$
(10,539
)
 
F-11
 
NOTE 11- SUBSEQUENT EVENTS

On April 7, 2017, Ben William Wong (“Wong”) and Yubao Liu, an individual (“Liu”) entered into a Stock Purchase Agreement (the “Agreement”) whereby Wong agreed to sell and Liu agreed to purchase 5,000,000 shares of the Company’s restricted preferred stock, representing 100% of the total issued and outstanding preferred stock (“Company Preferred Stock”). In consideration for the Company Preferred Stock, Liu agreed to pay to Wong a total of 5,000,000 Chinese Yuan on or before April 30, 2017. The Agreement closed on April 20, 2017 (the “Closing”)

Additionally, on April 5, 2017, Liu and Shining Glory Investments Limited, a British Virgin Islands company (“Shining Glory”), of which Wong is the sole officer and director, entered into a purchase agreement whereby Liu acquired 1 ordinary common stock share (the “Shining Glory Share”) representing approximately 100% of Shining Glory’s outstanding shares of common stock.  In consideration for the Shining Glory Share, Liu paid to Wong a total of $1 USD and Wong resigned as a Director of Shining Glory. Concurrently, Liu was appointed as the sole director of Shining Glory. The agreement between Shining Glory and Liu closed on April 20, 2017.

Shining Glory is the beneficial owner of 29,846,000 shares of restricted common stock (“Company Common Stock”) of Ionix Technology, Inc. (the “Company”), representing 30.147% of the Company’s total issued and outstanding common stock, and at Closing Liu became the beneficial owner of 5,000,000 shares of the Company’s Preferred Stock, representing 100% of the total issued and outstanding preferred stock. As the holder of the Company Preferred Stock, Liu has the right to 100 votes for each share of Company Preferred Stock.  Combining the votes associated with the Company Common Stock with those associated with the Company Preferred Stock means that Liu has over 50% voting control of the Company. 

The foregoing description is qualified by reference to the complete terms of the agreements, a copy of which was filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Commission on April 10, 2017, and incorporated herein by reference.
   
 
On April 30, 2017, Well Best International Investment Limited (“Well Best”), a wholly-owned subsidiary of the Company, transferred all of its rights, title and interest to all 100% of the issued and outstanding common stock of Xinyu Ionix Technology Company Limited (“Xinyu Ionix”) to Zhengfu Nan for Chinese Yuan ¥ 100($14.49 USD) pursuant to a Share Transfer Agreement dated April 30, 2017 (the “Agreement”). Pursuant to the Agreement the consideration shall be paid to Well Best within 15 working days after execution of the Agreement. Following the execution of the Agreement, Mr. Nan owns 100% of Xinyu Ionix and assumes all liabilities of Xinyu Ionix.
 
F-12
 
Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations.
 
The following Management's Discussion and Analysis should be read in conjunction with Ionix Technology, Inc.’s. financial statements and the related notes thereto. The Management's Discussion and Analysis contains forward-looking statements that involve risks and uncertainties, such as statements of our plans, objectives, expectations and intentions. Any statements that are not statements of historical fact are forward-looking statements. When used, the words “believe,” “plan,” “intend,” “anticipate,” “target,” “estimate,” “expect,” and the like, and/or future-tense or conditional constructions (“will,” “may,” “could,” “should,” etc.), or similar expressions, identify certain of these forward-looking statements. These forward-looking statements are subject to risks and uncertainties that could cause actual results or events to differ materially from those expressed or implied by the forward-looking statements in this Report on Form 10-Q. The Company’s actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of several factors. The Company does not undertake any obligation to update forward-looking statements to reflect events or circumstances occurring after the date of this Report on Form 10-Q.
 
The following discussion should be read in conjunction with our unaudited consolidated financial statements and related notes and other financial data included elsewhere in this report. See also the notes to our consolidated financial statements and Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in our Annual Report on Form 10-K/A for the year ended June 30, 2016, filed with the Commission on March 17, 2017.

Results of Operations for the three and nine months ended March 31, 2017 and 2016

Revenue

The Company’s historical revenue has been derived from the production and sale of both standardized and specialized products, specifically 18650-2000mAh lithium ion batteries for use in lithium cell electronic bicycles, balance cars, scooters, electric vehicles, special vehicles at low speed, energy storage, and other products. In September of 2016, the Company began operations related to production of a 5 volt 2 amp, 20000mAh lithium ion battery powered portable device  (a “power bank”) offering charging time of 12-18 hours that is intended to be utilized as a power source for electronic devices such as the iphone, ipad, mp3/mp4 players, PSP gaming systems, and cameras and a module of new energy power system/ LCD screen that is manufactured for small devices such as video capable baby monitors, electronic devices such as tablets and cell phones, and for use in televisions or computer monitors.

During the three months ended March 31, 2017 and 2016, revenue was $2,009,957 and $0, respectively. The difference can be attributed to the commencement of our business and generating revenue from the sale of lithium batteries , t he power banks and LCD screens in the PRC. Total revenue during the three month period ended March 31, 2017, was comprised of $1,808,957 generated from the sale of standardized lithium ion battery cells and approximately $201,000 in revenue generated from the sale of specialized products made tailored to our customer’s needs. The revenue generated from the sale of specialized products represented approximately 10% of our total revenue for the three months ended March 31, 2017.

During the nine months ended March 31, 2017 and 2016, revenue was $4,984,296 and $0, respectively. The difference can be attributed to the commencement of our business and generating revenue from the sale of lithium batteries , t he power banks and LCD screens in the PRC. Total revenue during the nine month period ended March 31, 2017, was comprised of $4,486,296 generated from the sale of standardized lithium ion battery cells and approximately $498,000 in revenue generated from the sale of specialized products made tailored to our customer’s needs. The revenue generated from the sale of specialized products represented approximately 10% of our total revenue for the nine months ended March 31, 2017.

Cost of Revenue
During the three months ended March 31, 2017 and 2016, the cost of revenue was $447,669 and $0, respectively from non-related parties, and $1,462,923 and $0, respectively from related parties. For the three months ended March 31, 2017, the cost of revenue included the cost of raw materials and the sub- contracting processing fee paid to the processing factories which were owned by our shareholders, pursuant to the manufacturing agreement between the Company’s subsidiaries in PRC and processing factories.
 
13
 
During the nine months ended March 31, 2017 and 2016, the cost of revenue was $1,602,007 and $0, respectively from non-related parties, and $3,044,012 and $0, respectively from related parties. For the nine months ended March 31, 2017, the cost of revenue included the cost of raw materials and the sub- contracting processing fee paid to the processing factories which were owned by our shareholders, pursuant to the manufacturing agreement between the Company’s subsidiaries in PRC and processing factories.

Gross Profit
During the three months ended March 31, 2017 and 2016, gross profit was $99,365 and $0, respectively. Our gross profit margin maintained at 5 % during the quarter ended March 31, 2017.

During the nine months ended March 31, 2017 and 2016, gross profit was $338,277 and $0, respectively. Our gross profit margin maintained at 7 % during the nine months ended March 31, 2017.

Selling, General and Administrative Expenses
During the three months ended March 31, 2017 and 2016, selling , general and administrative expenses were $80,997and $15,712, respectively. During the nine months ended March 31, 2017 and 2016, selling , general and administrative expenses were $292,146 and $15,712, respectively. Our selling, general and administrative expenses mainly comprised of payroll expenses, transportation, office expense, professional fees and other miscellaneous expenses. The expenses were significantly more in 2017 as we have commenced and expanded our operations in the PRC during this period.

Net Income (loss)

During the three months ended March 31, 2017 and 2016, net income was $16,054 and $1,585, respectively, which included net income (loss) from continuing operation of $16,054 and $(15,712), and net income from discontinued operation of $0 and $17,297, respectively. The change in net income (loss) from continuing operation is primarily the result of the commencement of operations in the PRC.

During the nine months ended March 31, 2017 and 2016, net loss was $15,860 and $8,954, respectively, which included net income (loss) from continuing operation of $19,239 and $(15,712), and net income (loss) from discontinued operation of $(35,099) and $6,758, respectively. The change in net income (loss) from continuing operation is primarily the result of the commencement of operations in the PRC.

Loss from Discontinued Operations
QI system business was terminated on November 15, 2015 and Taizhou Ionix was sold on August 19, 2016. Hence the Company has presented results of QI system operations and Taizhou Ionix as a discontinued operation in the consolidated statements of comprehensive income (loss) as discussed in Note 4 to the Notes to Consolidated Financial Statements.  During the three months ended March 31, 2017 and 2016, income from discontinued operations was $0 and $17,297, respectively. During the nine months ended March 31, 2017 and 2016, income (loss) from discontinued operations was $(35,099) and $6,758, respectively, all of which were loss from discontinued operation of Taizhou Ionix for the nine months ended March 31, 2017 while all of which were the general and administrative expense, mainly included consulting fees, audit and legal fees for the nine months ended March 31, 2016.

During the nine months ended March 31, 2017, and specifically on August 19, 2016, Well Best entered into a share transfer agreement whereby Well Best sold 100% of its equity interest in Taizhou Ionix Technology Co. Ltd. (“Taizhou Ionix”) to Mr. GuoEn Li, the sole director and officer of Taizhou Ionix for   approximately RMB 30,000 (approximately $5,000USD). During the nine months ended March 31, 2017, loss from discontinued operation of Taizhou Ionix was $ 35,099.

  Liquidity and Capital Resources

  Cash Flow from Operating Activities
During the nine months ended March 31, 2017 and 2016, $997,026 cash was used in continuing operating activities compared with $11,773, respectively. There was an increase in inventory and advance to suppliers which were partially offset by an increase in account payable and advance from customers.

During the nine months ended March 31, 2017 and 2016, net cash used in discontinued operations was $0 and $18,282, respectively.

Cash Flow from Financing Activities
During the nine months ended March 31, 2017 , the Company received $1,037,060 in cash from financing activities, which consisted of proceeds from related parties loans. In comparison, during the nine months ended March 31, 2016, the Company received $110,882 in cash from financing activities, which consisted of $46,899 in proceeds from related parties loans and $50,000 from the issuance of preferred shares.
 
14
 
As of March 31, 2017, we have a working capital of $18,541 .

Our total current liabilities as of March 31, 2017 is $1,968,573, which consist primarily of account payables of $752,930, a dvance from customers of $116,245 and due to related parties of $1,069,989 . Our Company’s President is committed to providing for our minimum working capital needs for the next 12 months, and we do not expect previous loan amounts to be payable for the next 12 months. However, we do not have a formal agreement that states any of these facts.  The remaining balance of our current liabilities relates to professional fees and consulting fees and such payments are due on demand and we expect to settle such amounts on a timely basis based upon shareholder loans to be granted to us in the next 12 months.

We will require approximately $150,000 to fund our working capital needs for the year ending June 30, 2017 as follows:

Audit and accounting
   
30,000
 
Legal Consulting fees
   
50,000
 
Salary and wages
   
30,000
 
 Edgar/XBRL filing, transfer agent and miscellaneous
   
40,000
 
Total
 
$
150,000
 

Future Financings

We will not consider taking on any long-term or short-term debt from financial institutions in the immediate future.   We are dependent upon our director and the major shareholder to provide continued funding and capital resources. If continued funding and capital resources are unavailable at reasonable terms, we may not be able to implement our plan of operations.  The financial statements do not include any adjustments related to the recoverability of assets and classification of liabilities that might be necessary should the Company be unable to continue in operation.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the Company’s financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.  
 
Critical Accounting Policies

Our financial statements and accompanying notes have been prepared in accordance with United States generally accepted accounting principles applied on a consistent basis. The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods.

We regularly evaluate the accounting policies and estimates that we use to prepare our financial statements. A complete summary of these policies is included in the notes to our financial statements. In general, management's estimates are based on historical experience, on information from third party professionals, and on various other assumptions that are believed to be reasonable under the facts and circumstances. Actual results could differ from those estimates made by management.
 
15
 
Recently Issued Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers: Topic 606. This Update affects any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets, unless those contracts are within the scope of other standards. The guidance in this Update supersedes the revenue recognition requirements in Topic 605, Revenue Recognition and most industry-specific guidance. The core principle of the guidance is that an entity should recognize revenue to illustrate the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new guidance also includes a cohesive set of disclosure requirements that will provide users of financial statements with comprehensive information about the nature, amount, timing, and uncertainty of revenue and cash flows arising from a reporting organization’s contracts with customers. This ASU is effective for fiscal years, and interim periods within those years beginning after December 15, 2016 for public companies and 2017 for non-public entities. Management is evaluating the effect, if any, on the Company’s financial position and results of operations. 

The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.
 
Contractual Obligations
 
We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.
 
ITEM 3.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 
We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.
 
 
ITEM 4.
CONTROLS AND PROCEDURES
 
 
Evaluation of Disclosure Controls and Procedures
 
Disclosure controls and procedures are controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by our company in the reports that it files or submits under the Exchange Act is accumulated and communicated to our management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Our management carried out an evaluation under the supervision and with the participation of our Principal Executive Officer and Principal Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 ("Exchange Act"). Based upon that evaluation, our Principal Executive Officer and Principal Financial Officer have concluded that our disclosure controls and procedures were not effective as of March 31, 2017.
 
Changes in Internal Control over Financial Reporting
 
Our management has also evaluated our internal control over financial reporting, and there have been no significant changes in our internal controls or in other factors that could significantly affect those controls subsequent to the date of our last evaluation.
 
The Company is not required by current SEC rules to include, and does not include, an auditor's attestation report. The Company's registered public accounting firm has not attested to Management's reports on the Company's internal control over financial reporting.
 
PART II - OTHER INFORMATION
 
ITEM 1.
LEGAL PROCEEDINGS
 
From time to time, the Company may become subject to various legal proceedings that are incidental to the ordinary conduct of its business. Although the Company cannot accurately predict the amount of any liability that may ultimately arise with respect to any of these matters, it makes provision for potential liabilities when it deems them probable and reasonably estimable. These provisions are based on current information and legal advice and may be adjusted from time to time according to developments.
 
16
 
We know of no material, existing or pending legal proceedings against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial stockholder, is an adverse party or has a material interest adverse to our interest.  

ITEM 1A.
RISK FACTORS
 
We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

ITEM 2.
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

  None.

ITEM 3.
DEFAULTS UPON SENIOR SECURITIES
 
None.
 
ITEM 4.
MINE SAFETY DISCLOSURES
 
N/A.
 
ITEM 5.
OTHER INFORMATION
 
On April 30, 2017, Well Best International Investment Limited (“Well Best”), a wholly-owned subsidiary of the Company, transferred all of its rights, title and interest to all 100% of the issued and outstanding common stock of Xinyu Ionix Technology Company Limited (“Xinyu Ionix”) to Zhengfu Nan for Chinese Yuan ¥ 100($14.49 USD) pursuant to a Share Transfer Agreement dated April 30, 2017 (the “Agreement”). Pursuant to the Agreement the consideration shall be paid to Well Best within 15 working days after execution of the Agreement. Following the execution of the Agreement, Mr. Nan owns 100% of Xinyu Ionix and assumes all liabilities of Xinyu Ionix.
 
17
 
ITEM 6.
EXHIBITS

Exhibit
 
 
 
Number
Description of Exhibit
 
 
3.01a
Articles of Incorporation, dated March 11, 2011
 
Filed with the SEC on August 23, 2011 as an exhibit to our Registration Statement on Form 10.
3.01b
Certificate of Amendment to Articles of Incorporation, dated August 7, 2014
 
Filed with the SEC on September 3, 2014 as part of our Current Report on Form 8-K
3.01c
Certificate of Amendment to Articles of Incorporation, dated December 3, 2015
 
Filed with the SEC on December 10, 2015 as part of our Current Report on Form 8-K
3.02a
Bylaws
 
Filed with the SEC on August 23, 2011 as an exhibit to our Registration Statement on Form 10.
3.02b
Amended Bylaws, dated August 7, 2014
 
Filed with the SEC on September 3, 2014 as part of our Current Report on Form 8-K
10.01
Stock Purchase Agreement between Locksley Samuels and Shining Glory Investments Limited, dated November 20, 2015
 
Filed with the SEC on November 23, 2015 as part of our Current Report on Form 8-K
10.02
Share Transfer Agreement, dated as of August 19, 2016, by and between GuoEn Li and Well Best International Investment Limited
 
Filed with the SEC on August 24, 2016 as part of our Current Report on Form 8-K
21.1
List of Subsidiaries
 
Filed herewith.
31.01
Certification of Principal Executive Officer Pursuant to Rule 13a-14
 
Filed herewith.
31.02
Certification of Principal Financial Officer Pursuant to Rule 13a-14
 
Filed herewith.
32.01
CEO Certification Pursuant to Section 906 of the Sarbanes-Oxley Act
 
Filed herewith.
32.02
CFO Certification Pursuant to Section 906 of the Sarbanes-Oxley Act
 
Filed herewith.
101.INS*
XBRL Instance Document
 
Filed herewith.
101.SCH*
XBRL Taxonomy Extension Schema Document
 
Filed herewith.
101.CAL*
XBRL Taxonomy Extension Calculation Linkbase Document
 
Filed herewith.
101.LAB*
XBRL Taxonomy Extension Labels Linkbase Document
 
Filed herewith.
101.PRE*
XBRL Taxonomy Extension Presentation Linkbase Document
 
Filed herewith.
101.DEF*
XBRL Taxonomy Extension Definition Linkbase Document
 
Filed herewith.

*Pursuant to Regulation S-T, this interactive data file is deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, and otherwise is not subject to liability under these sections.
 
18
 
SIGNATURES
 
In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
 
 
Ionix Technology, Inc.
 
 
 Date: May 22, 2017
By:
/s/ Doris Zhou
 
 
Name:  Doris Zhou
Title:    Chief Executive Officer and Director
(Principal Executive Officer)
 
 Date: May 22, 2017
By:
/ s/ Yue Kou
 
 
Name:  Yue Kou
Title:    Chief Financial Officer
(Principal Financial Officer)
 
In accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
 
 
 
 Date: May 22, 2017
By:
/s/ Doris Zhou
 
 
Name:  Doris Zhou
Title:    Chief (Principal) Executive Officer,
Secretary, Treasurer and Sole Director
 
 Date: May 22, 2017
By:
/ s/ Yue Kou
 
 
Name:  Yue Kou
Title:    Chief (Principal) Financial Officer
 
 
19
EXHIBIT 21.1
 
LIST OF SUBSIDIARIES OF IONIX TECHNOLOGY, INC.
(As of May 15, 2017)
 
         
1. Well Best International Investment Limited
Subsidiary of: Ionix Technology, Inc. (Wholly Owned by Ionix)
Jurisdiction of Formation: Hong Kong Special Administrative Region, September 14, 2015
Names under which business is conducted: Well Best International Investment Limited
 

2. Lisite Science Technology (Shenzhen) Co., Ltd
Subsidiary of: Well Best International Investment Limited (Wholly Owned by Well Best)
Jurisdiction of Formation: Taiwan, Hong Kong, and Macao, June 20, 2016
Names under which business is conducted: Lisite Science Technology (Shenzhen) Co., Ltd

3. Shenzhen Baileqi Electronic Technology Co., Ltd.
Subsidiary of: Well Best International Investment Limited (Wholly Owned by Well Best)
Jurisdiction of Formation: Taiwan, Hong Kong, and Macao, August 8, 2016
Names under which business is conducted: Shenzhen Baileqi Electronic Technology Co., Ltd.


4. Welly Surplus International Limited
Subsidiary of: Welly Surplus International Limited (99.9% Owned by Ionix)
Jurisdiction of Formation: Hong Kong,  January 18,  2016
Names under which business is conducted: Welly Suplus International Limited.
 
 
 
EXHIBIT 31.01
 
CERTIFICATION OF
PRINCIPAL EXECUTIVE OFFICER
PURSUANT TO SECTION 302(a) OF THE SARBANES-OXLEY ACT OF 2002

I, Doris Zhou, certify that:

1.      I have reviewed this Quarterly Report on Form 10-Q of the Registrant for the period ended March 31, 2017;

2.      Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.      Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

4.      As the Registrant’s certifying officer, I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:

a.      Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.      Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.      Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.      Disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and

5.      As the Registrant’s certifying officer, I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant auditors and the audit committee of the Registrant’s Board of Directors (or persons performing the equivalent functions):

a.      All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and

b.      Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.
 
 
Ionix Technology, Inc .
  Date: May 22, 2017  
By:
/s/ Doris Zhou
 
 
Name:
Doris Zhou
 
Title:
Chief (Principal) Executive Officer
 
 
  
EXHIBIT 31.02
CERTIFICATION OF
PRINCIPAL ACCOUNTING OFFICER
PURSUANT TO SECTION 302(a) OF THE SARBANES-OXLEY ACT OF 2002

I, Yue kou, certify that:

1.      I have reviewed this Quarterly Report on Form 10-Q of the Registrant for the period ended March 31, 2017;

2.      Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.      Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

4.      As the Registrant’s certifying officer, I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:

a.      Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.      Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.      Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.      Disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and

5.      As the Registrant’s certifying officer, I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant auditors and the audit committee of the Registrant’s Board of Directors (or persons performing the equivalent functions):

a.      All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and

b.      Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.
 
 
Ionix Technology, Inc.
  Date: May 22, 2017
By:
/s/  Yue Kou
 
 
Name:
Yue Kou
 
Title:
Chief (Principal) Accounting and Financial Officer
 
 
  
EXHIBIT 32.01
 

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Doris Zhou, the Chief Executive Officer of Ionix Technology, Inc., certify, under the standards set forth and solely for the purposes of 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge, the Quarterly Report on Form 10-Q of the Registrant for the period ended March 31, 2017, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and information contained in that Form 10-Q fairly presents, in all material respects, the financial condition and  results of operations of the Registrant.

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.
 
 
Ionix Technology, Inc .
  Date: May 22, 2017
 
 
By:
/s/ Doris Zhou
 
 
Name:
Doris Zhou
 
Title:
Chief (Principal) Executive Officer
 
 
A signed original of this written statement required by Section 906 has been provided to the Registrant and will be retained by the Registrant and furnished to the Securities and Exchange Commission or its staff upon request.
 
 
 
EXHIBIT 32.02


CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Yue Kou, the Chief Accounting and Financial Officer of Ionix Technology, Inc., certify, under the standards set forth and solely for the purposes of 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge, the Quarterly Report on Form 10-Qof the Registrant for the period ended March 31, 2017, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and information contained in that Form 10-Q fairly presents, in all material respects, the financial condition and  results of operations of the Registrant.

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.
 
Date: May 22, 2017
Ionix Technology, Inc.
 
 
 
By:
/s/  Yue Kou
 
 
Name:
Yue Kou
 
Title:
Chief (Principal) Accounting and Financial Officer
 
 
A signed original of this written statement required by Section 906 has been provided to the Registrant and will be retained by the Registrant and furnished to the Securities and Exchange Commission or its staff upon request.