The following discussion should be read in conjunction with our financial statements, including the notes thereto, appearing elsewhere in this annual report. The discussion of results, causes and trends should not be construed to imply any conclusion that these results or trends will necessarily continue into the future. All references to currency in this "Management's Discussion and Analysis of Financial Condition and Results of Operations" section are to U.S. dollars, unless otherwise noted.

Liquidity and Capital Resources

For the years ended June 30, 2020 and 2019

As of June 30, 2020, we had $1,351 in cash, current assets of $5,022, current liabilities of $1,261,089 and working capital deficit of $1,256,067. As of June 30, 2019, we had $2,603 in cash, current assets of $6,383, current liabilities of $1,087,760 and working capital deficit of $1,081,377. As of June 30, 2020, we had total assets of $49,745, compared to total assets of $21,119as of June 30, 2019.

During the year ended June 30, 2020, we used net cash of $112,611 in operating activities, compared to net cash used of $146,973in operating activities during the year ended June 30, 2019.The decrease of $34,362 for net cash used in operating activities was primarily due to increase in noncash lease expense and depreciation expense.

During the year ended June 30, 2020, we received net cash of $105,927 from financing activities, compared to net cash received of $142,628 in financing activities during the year ended June 30, 2019. The decrease of $36,701 in net cash provided by financing activities was due to decrease in proceeds received from a related party.

Our net cash level decreased by $1,252 during the year ended June 30, 2020, compared to a decrease of$4,576 during the year ended June 30, 2019. The changes in cash were a result of the factors described above.

In assessing its liquidity, management monitors and analyzes the Company's cash on-hand, its ability to generate sufficient revenue sources in the future and its operating and capital expenditure commitments. The Company plans to fund working capital through cooperation with other film and television producers and obtaining shareholders' loans to meet our cash requirements. The President and Chief Executive Officer of the Company, Mr. Dean Li, has pledged to provide personal loans whenever necessary to the Company as working capital for next twelve months.

We anticipate that we will meet our ongoing cash requirements by retaining income as well as through equity or debt financing. We plan to cooperate with various individuals and institutions to acquire the financing required to produce and distribute our films and television series and anticipate this will continue until we accrue sufficient capital reserves to finance all of our productions independently.

We estimate that our expenses over the next 12 months (beginning October 2020) will be approximately $650,000 as described in the table below. These estimates may change significantly depending on the nature of our future business activities and our ability to raise capital from shareholders or other sources.






Description                         Estimated Completion Date Estimated Expenses
                                                               ($)
Legal and accounting fees           12 months                 100,000
Management and operating costs      12 months                 200,000
Salaries and consulting fees        12 months                 200,000
General and administrative expenses 12 months                 150,000
Total                                                         650,000





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We intend to meet our cash requirements for the next 12 months through a combination of debt financing and equity financing by way of private placements. There is good potential for the development of our business in China. If we get more liquidity, it will be best way to expand our business and improve profit. We currently do not have any arrangements in place to complete any private placement financings and there is no assurance that we will be successful in completing any such financings. If we are not able to successfully complete any private placement financings, we plan to cooperate with film and television producers or obtain shareholder loans to meet our cash requirements. However, there is no assurance that any such financing will be available or if available, on terms that will be acceptable to us. We may not raise sufficient funds to fully carry out our business plan.





Results of Operations

The following table sets forth information from our statements of operations for the years ended June 30, 2020 and 2019:





                                                    For The Years Ended June 30
                                               2020                          2019

Operating expenses
Selling, general and administrative
expenses                                $           189,436       $                   206,553
Depreciation and amortization expense                14,049                                 -
Impairment loss on film costs                             -                           732,966
Total operating expenses                            203,485                           939,519

Other expenses:
Interest expense                                     26,926                            25,187
      Total other expenses                           26,926                            25,187

Net loss  before income taxes                     (230,411)                         (964,706)
Income taxes                                              -                                 -
Net loss                                 $        (230,411)       $              (964,706)



Revenues and cost

We had no sales and cost for the years ended June 30, 2020 and 2019.

Operating Expenses

During the year ended June 30, 2020, our total operating expenses were $203,485, a decrease of $736,034 as compared to $939,519for the year ended June 30, 2019. The main decrease was primarily due to decrease in impairment loss on film costs.




Net Loss

For the year ended June 30, 2020, we incurred a net loss of $230,411, as compared to a net loss of $964,706for the year ended June 30, 2019, a decrease of $734,295. This decrease was primarily due to the decrease in operating expenses.




Impact of COVID-19 Pandemic

In late January 2020, the coronavirus ("COVID-19") was rapidly evolving in China and globally led to disruptions in the business and transportation. The Chinese government implemented a series of restrictions, including lock-downs, social distancing requirements, and travel restrictions that drastically reduced traditional offline business. Considering the features of our business in the media industries, we experienced business disruption as a result of those measures to contain the COVID-19 outbreak. Since March 2020, the Chinese government has eased its COVID-19 restrictions domestically, and the Chinese domestic business started to recover. Our operations in the third quarter and fourth quarter of 2020 was not significantly impacted by the COVID-19. However, it is not possible to determine the ultimate impact of the COVID-19 pandemic on the Company's business operations and financial results, which is highly dependent on numerous factors, including the duration and spread of the pandemic and any resurgence of COVID-19 in China or elsewhere, actions taken by governments, the responses of businesses and individuals to the pandemic.






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Contractual Obligations

As a "smaller reporting company", we are not required to provide tabular disclosure obligations.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to stockholders.

APPLICATION OF CRITICAL ACCOUNTING POLICIES

Our audited financial statements and accompanying notes are prepared in accordance with generally accepted accounting principles used in the United States. Preparing financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses. These estimates and assumptions are affected by management's application of accounting policies. We believe that understanding the basis and nature of the estimates and assumptions involved with the following aspects of our consolidated financial statements is critical to an understanding of our financials.




Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes, including estimates of ultimate revenues and ultimate costs of film and television products, estimates of product sales that will be returned and the amount of receivables that ultimately will be collected, the potential outcome of future tax consequences of events that have been recognized in the Company's financial statements and loss contingencies. Actual results could differ from those estimates. To the extent that there are material differences between these estimates and actual results, the Company's financial condition or results of operations will be affected. Estimates are based on past experience and other assumptions that management believes are reasonable under the circumstances, and management evaluates these estimates on an ongoing basis.

Fair Value of Financial Instruments

The fair value of financial instruments, which consist of cash and cash equivalents, prepaid and other receivable, accounts payable, accrued liabilities and other payable, were estimated to approximate their carrying values due to the immediate or relatively short maturity of these instruments.

Earnings (loss) Per Share

The Company calculates net income (loss) per share in accordance with ASC 260, Earnings Per Share. Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during each period. Diluted earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during each period. As of June 30, 2020 and 2019, respectively, the Company had no common stock equivalents that could potentially dilute future earnings (loss) per share.

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