What changed in this filing

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Item 7. Management’s Discussion and Analysis

2025-07-03 compared with 2024-04-09 · 89 added, 40 removed, 102 unchanged (56% of the section changed)

Discussion And Analysis Of Financial Condition And Results Of Operations.

Looking Statement Notice

Forward-Looking

Statement Notice

Current Report on Form 10-K contains forward-looking statements within the meaning of the federal securities laws.

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The factors listed in the section captioned “Risk Factors,”

as well as any cautionary language in this report;

provide examples of risks, uncertainties and events that may cause our actual results

as well as any cautionary language in this report, provide examples of risks, uncertainties, and events that may cause our actual results

to differ materially from those projected.

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Company was incorporated in the state of Nevada on September 14, 2001 under the name Biocorp North America, Inc.

On July 19, 2004 the

Company changed its name to Nat-UR, Inc.

and on March 18, 2005 it changed its name again to Cereplast, Inc.

developed and tried to commercializing proprietary bio-based resins through two complementary product families:

Cereplast Compostables

resins which are compostable, renewable, ecologically sound substitutes for petroleum-based plastics, and Cereplast Sustainables resins

(including the Cereplast Hybrid Resins product line), which replaces up to 90% of the petroleum-based content of traditional plastics

with materials from renewable resources.

Our resins could be converted into finished products using conventional manufacturing equipment

without significant additional capital investment by downstream converters.

On March 18, 2005, it

changed its name to Cereplast, Inc.

In the summer of 2014, the Company ceased all operations.

and since that time has been inactive.

March 22, 2019, the eight judicial District Court of Nevada appointed Custodian Ventures, LLC as custodian for Cereplast, Inc., proper

notice having been given to the officers and directors of Cereplast, Inc.

There was no opposition.

June 04, 2019, the Company filed a certificate of revival with the state of Nevada, appointing David Lazar as, President, Secretary,

Treasurer and Director.

change of control of the Company was completed on November 3, 2020, control was obtained by the sale of 50,000,000 common shares and

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are determined and structured by the new major shareholder.

November 18, 2020, the Company filed an amendment to its certificate of incorporation to change its name to Hong Yuan Holding Group.

October 1, 2024, The Company entered into an agreement to acquire from Xudong Li (the majority shareholder of the Company) 100% equity

interest of Hongyuan International Holding Group Co., Ltd.

(“Hongyuan HK”) in exchange for HK $500,000 (approximately $64,103)

or issuing the equivalent value of the Company’s common stocks, payable upon the completion of changing registered owner with the

Administration for Industrial and Commerce.

Hongyuan HK was established in Hong Kong on July 28, 2021.

on October 1, 2024, Hongyuan HK entered into a series of agreements including a Shareholders’ Voting Rights Entrustment Agreement,

an Exclusive Management Consulting and Service Agreement and a Share Pledge Agreement (collectively the “Agreements”) with

Fengcuiyuan Chang Technology Development Co., Ltd (“Fengcuiyuan”) and its registered owners (the “Transaction”).

Fengcuiyuan is a corporation formed under the laws of the PRC on September 3, 2021, in which Xudong Li (the majority shareholder of the

Company) controls 95% of its equity interest.

Fengcuiyuan owns 98% of Rongcheng (Sichuan) Supply Chain Management Co., Ltd (“Rongcheng”),

a corporation formed under the laws of the PRC located in Chengdu, Sichuan, China, incorporated on April 17, 2024.

On November 12, 2024,

Chongqing Xuchang Qingrong Trading Co., Ltd.

(“Xuchang”) located in Chongqing, Sichuan, China, was formed as a 55% subsidiary

of Rongcheng.

to the Agreements, Hongyuan HK assumed financial and operating control of Fengcuiyuan.

As a result, Hongyuan HK has been determined to

have a controlling financial interest in Fengcuiyuan, requiring Hongyuan HK to consolidate the financial statements of Fengcuiyuan and

its subsidiaries, and ultimately consolidate with its parent company, Hong Yuan.

The Transaction was accounted for as a reorganization

of entities under common control.

As the combining entities have been under common control since September 2021, the consolidated financial

statements of the Company recognized the assets and liabilities received in the reorganization at their historical carrying amounts,

as reflected in the historical financial statements of each entity.

Company, through its subsidiary and the Agreements with Fengcuiyuan, focuses on supply chain management services, is mainly engaged in

the wholesale and internet sales of fast-moving consumer goods such as food, daily necessities, and electronic products, covering diversified

fields such as pre-packaged food, agricultural and by-products, and household goods.

have not yet generated sustained profits from our prior operations.

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consolidated financial statements.

2014-09 , Revenue from Contracts with Customers (“Topic 606”), became effective for the Company on January

1, 2018 and were adopted using the modified retrospective method.

The adoption of the new revenue standards as of January 1, 2018 did

not change the Company’s revenue recognition as there were no revenues during the period.

the new revenue standards, the Company recognizes revenues when its customer obtains control of promised goods or services, in an amount

that reflects the consideration which it expects to receive in exchange for those goods.

The Company recognizes revenues following the

five step model prescribed under ASU No.

(i) identify contract(s) with a customer;

(ii) identify the performance obligations

in the contract;

(iii) determine the transaction price;

(iv) allocate the transaction price to the performance obligations in the contract;

and (v) recognize revenues when (or as) we satisfy the performance obligation.

Company reviews accounts receivable periodically for collectability and establishes an allowance for doubtful accounts and records bad

debt expense when deemed necessary.

Our allowance for doubtful accounts is maintained to provide for losses arising from customers’

inability to make required payments.

If there is deterioration of our customers’ credit worthiness and/or there is an increase

in the length of time that the receivables are past due greater than the historical assumptions used, additional allowances may be required.

The Company has no allowance for doubtful accounts as of December 31, 2024 and 2023, respectively.

Company follows the asset and liability method of accounting for future income taxes.

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of Operations for the Year Ended December 31, 2024 compared to the Year Ended December 31, 2023

the summer of 2014, the Company decided to discontinue all operations.

After the change of control on November 3, 2020, the Company’s

operations are determined and structured by the new major shareholder.

the years ended December 31, 2023 and 2022, we generated no revenues.

expenses, including general and administrative expenses, during the year ended December 31, 2023, was $39,720 compared to $58,348 during

the year ended December 31, 2022, a decrease of $18,628 or 32%.

The decrease was mainly due to the lower general and administrative expenses,

partly offset by higher professional fees.

was $245,572 in 2024 compared to Nil in 2023.

The increase in revenue was mainly due to the consolidation of the Chinese VIEs under common

control which started generating revenue in the second quarter of 2024.

of goods sold was $152,675 in 2024 compared to Nil in 2023 due to no revenue in the same period last year as explained above.

expenses were $189,198 and $154,476 for 2024 and 2023, respectively, an increase of $34,722 or 22.5%.

The increase was mainly due to

the increase in general and administrative expenses, partly offset by the slight decrease in professional fees.

The increase in general

and administrative expenses in 2024 was mainly due to the increase in rent expense, personnel expense, and office expense.

the year ended December 31, 2024, the Company incurred a net loss of $96,437, compared to a net loss of $154,464 during the year ended

December 31, 2022.

The $18,628 decrease in net loss was primarily due to the decrease in operating expenses.

December 31, 2023, a decrease of $58,027 or 37.6%.

The decrease in net loss in 2024 was primarily due to the increase in gross profit

as a result of the Chinese VIEs starting to generate revenue, partly offset by the increase in operating expenses.

and Capital Resources

of December 31, 2023, and 2022, we had a cash balance of $0.

Due to the lack of revenue, the company’s operations are primarily

funded by the Company’s CEO and major shareholder.

of December 31, 2024 and 2023, we had a cash balance of $46,291 and $5,983 respectively.

During 2023 and 2024, the company’s operations

are primarily funded by the Company’s CEO and major shareholder and the minority owners of the Chinese VIEs.

the extent that the Company’s capital resources are insufficient to meet current or planned operating requirements, the Company

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would favorably entertain funding, through loans, corporate expenses for approximately 24 months.

Any loans by Ms.

Any loans by Mr.

Xudong would be on

an interest-free basis, documented by a promissory note and payable only upon consummation of a business combination transaction.

consummation of a business combination, we or the target may reimburse Ms.

consummation of a business combination, we or the target may reimburse Mr.

Xudong for any such loans from funds furnished by the target.

We have no written agreement with Ms.

We have no written agreement with Mr.

Xudong to advance any further funds for future operating expense, therefore there is no assurance

that such funds from Ms.

that such funds from Mr.

Xudong will be forth coming, if required.

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raise substantial doubt about the ability of the Company to continue as a going concern.

cash used in operating activities was $0 during the year ended December 31, 2023 and 2022.

the year ended December 31, 2024, net cash used in operating activities was $89,582.

This was primarily due to the net loss of $96,437,

adjusted by non-cash related expenses including depreciation of $1,356, and then increased by favorable changes in working capital of

The favorable changes in working capital mainly resulted from an increase in accounts payable and accrued liabilities of $36,418,

an increase in tax payable of $4,281, and an increase in due to related party of $37,609, offset by an increase in accounts receivable

of $11,540, an increase in inventory of $44,378, and an increase in prepaid expense and other receivables of $16,891..

the year ended December 31, 2023, net cash used in operating activities was $111,866.

This was primarily due to the net loss of $154,464,

adjusted by non-cash related expenses including depreciation of $1,378, and then increase by favorable changes in working capital of

The favorable changes in working capital mainly resulted from an increase in due to related party of $40,484.

neither generated nor used cash in investing activities during the year ended December 31, 2024 and 2023.

neither generated nor used cash in financing activities during the year ended December 31, 2023 and 2022.

the year ended December 31, 2024 and 2023, net cash provided by financing activities were proceeds from capital contribution received

by Chinese VIEs of $130,634 and $106,314 respectively.

accompanying financial statements have been prepared assuming that the Company will continue as a going concern.

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financial statements, we have incurred net losses of $96,437 and $154,464 for the year ended December 31, 2024 and 2023, respectively,

and have a working capital deficit of $151,244 as of December 31, 2023, in addition to a stockholder deficit of $151,244, which raise

substantial doubt about the Company’s ability to continue as a going concern.

and have a working capital deficit of $243,326 as of December 31, 2024, in addition to a stockholders’ deficit of $168,802 which

raise substantial doubt about the Company’s ability to continue as a going concern.

believes the Company will continue to incur losses and negative cash flows from operating activities for the foreseeable future and will

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis