UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~September~~December 3031, 2023

☐ 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: 0-56168

ORGANIC AGRICULTURAL COMPANY LIMITED

(Exact name of registrant as specified in its charter)

Nevada		82-5442097
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification Number)

Room G510, Building No. 3, Kejichuangxincheng Chuangxinchuangye Plaza,

High and New Technology Industrial Development District,

Harbin City, Heilongjiang Province,

China 150090

Office: +86 (0451) 5152-7001

(Address, including zip code, and telephone number, including area code, of Registrant’s principal executive offices)

of Registrant’s principal executive offices)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class		Trading Symbol		Name of Each Exchange on Which Registered
None		None		Not Applicable

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 every Interactive Data File required to be submitted 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 such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a 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.

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 12 b-2 of the Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

As of the date of filing of this report, there were outstanding 92,726,994 shares of the issuer’s common stock, par value $0.001 per share.

TABLE OF CONTENTS

		Page
	PART I—FINANCIAL INFORMATION
Item 1	Financial Statements	1
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	56
Item 4.	Controls and Procedures	56
	PART II—OTHER INFORMATION
Item 1.	Legal Proceedings	67
Item 1A.	Risk Factors	67
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	67
Item 3.	Defaults Upon Senior Securities	67
Item 4.	Mine Safety Disclosure	67
Item 5.	Other Information	67
Item 6.	Exhibits	78

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

	Page
ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES
Condensed Consolidated Balance Sheets as of September 30, 2023 (Unaudited) and March 31, 2023	F-1
Condensed Consolidated Balance Sheets as of December 31, 2023 (Unaudited) and March 31, 2023	F-1
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the Three and Six Months Ended September 30, 2023 and 2022 (Unaudited)	F-2
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the Three and Nine Months Ended December 31, 2023 and 2022 (Unaudited)	F-2
Condensed Consolidated Statements of Changes in Shareholders’ Equity for the Six Months Ended September 30, 2023 and 2022 (Unaudited)	F-3
Condensed Consolidated Statements of Changes in Shareholders’ Equity for the Nine Months Ended December 31, 2023 and 2022 (Unaudited)	F-3
Condensed Consolidated Statements of Cash Flows for the Six Months Ended September 30, 2023 and 2022 (Unaudited)	F-4
Condensed Consolidated Statements of Cash Flows for the Nine Months Ended December 31, 2023 and 2022 (Unaudited)	F-4
Notes to Condensed Consolidated Financial Statements (Unaudited)	F-5 – F-18

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

AS OF ~~SEPTEMBER~~DECEMBER 3031, 2023 AND MARCH 31, 2023

(EXPRESSED IN US DOLLARS)

	September 30,			March 31,
	December 31,			March 31,
	2023			2023
	Unaudited
Assets
Current assets:
Cash	$	9560,~~141~~487		$	49,862
Accounts receivable		25313,~~743~~385			14,357
Due from related parties		32,~~033~~284			324
Prepaid expenses		1716,~~895~~723			756
Inventories		~~337~~146,~~234~~324			149,757
Other receivables		4025,~~038~~060			22,533
Total current assets		~~519~~564,~~084~~263			237,589
Total assets	$	~~519~~564,~~084~~263		$	237,589
Liabilities and shareholders’ equity
Current liabilities:
Accounts payable and accrued expenses	$	2815,~~867~~671		$	61,469
Customer deposits		~~152~~157,~~412~~079			151,435
Due to related parties		2725,~~916~~846			726
Other payables		~~689~~2,599			733
Total current liabilities		~~209~~201,~~884~~195			214,363
Total liabilities		~~209~~201,~~884~~195			214,363
Shareholders’ equity:
Preferred stock; $0.001 par value, 1,000,000 shares authorized, no shares issued and outstanding at September 30, 2023 and March 31, 2023		-			-
Preferred stock; $0.001 par value, 1,000,000 shares authorized, no shares issued and outstanding at December 31, 2023 and March 31, 2023		-			-
Common stock; $0.001 par value, 274,000,000 shares authorized; 93,726,994 shares issued and outstanding at September 30, 2023 and March 31, 2023		93,727			93,727
Common stock; $0.001 par value, 274,000,000 shares authorized; 93,726,994 shares issued and outstanding at December 31, 2023 and March 31, 2023		93,727			93,727
Additional paid-in capital		5,153,407			5,153,407
Subscription receivable		(705,396	)		(838,095	)
(Deficit)		(4,~~335~~221,~~199~~111	)		(4,359,869	)
Other comprehensive income (loss)		~~102~~42,~~661~~441			(25,944	)
Total shareholders’ equity of the Company		~~309~~363,~~200~~068			23,226
Total shareholders’ equity		309,200			23,226
Non-controlling interest		-			-
Total liabilities and shareholders’ equity	$	519,084		$	237,589
Total shareholders’ equity		363,068			23,226
Total liabilities and shareholders’ equity	$	564,263		$	237,589

The accompanying notes are an integral part of these condensed consolidated financial statements.

F-1

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS)

FOR THE THREE AND ~~SIX~~NINE MONTHS ENDED ~~SEPTEMBER~~DECEMBER 3031, 2023 AND 2022

(UNAUDITED) (EXPRESSED IN US DOLLARS)

	For the Three Months Ended September 30,						For the Six Months Ended September 30,
	For the Three Months Ended December 31,						For the Nine Months Ended December 31,
	2023			2022			2023		2022
Revenue	$	~~817~~297,~~410~~435		$	3893,~~277~~531		$	~~991~~1,~~179~~288,614	$	77170,~~261~~792
Cost of sales		~~544~~213,~~487~~847			3183,~~490~~514			~~666~~880,~~688~~535		62146,~~762~~276
Gross profit		~~272~~83,~~923~~588			610,~~787~~017			~~324~~408,~~491~~079		1424,~~499~~516
Selling, general and administrative expenses		94(32,~~597~~326	)		~~309~~9,~~487~~564			~~299~~267,~~838~~512		~~535~~544,~~356~~920
Operating income (loss)		~~178~~115,~~326~~914			~~(302,700~~453	)		24140,~~653~~567		(520,~~857~~404	)
Other income		-			1,464			17		2,481
Other income (loss)		-			(46	)		17		2,435
Income (loss) before provision for income taxes		~~178~~115,~~326~~914			~~(301,236~~407	)		24140,~~670~~584		(~~518~~517,~~376~~969	)
Provision for income taxes		-1,826			-			-1,826		-
Net income (loss) from continuing operations		~~178~~114,~~326~~088			~~(301,236~~407	)		24138,~~670~~758		(~~518~~517,~~376~~969	)
Gain on the sale of discontinued operations, net of income taxes (Note 3)		-			~~68,359~~-			-		68,359
(Loss) from discontinued operations, net of income taxes (Note 3)		-			-			-		(1	)
Net income (loss)		~~178~~114,~~326~~088			~~(232,877~~407	)		24138,~~670~~758		(~~450~~449,~~018~~611	)
Less: (loss) from discontinued operations attributable to non-controlling interests		-			-			-		-
Net income (loss) attributable to common shareholders	$	~~178~~114,~~326~~088		$	~~(232,877~~407	)	$	24138,~~670~~758	$	(~~450~~449,~~018~~611	)
Amounts attributable to common shareholders:
Net income (loss) from continuing operations	$	~~178~~114,~~326~~088		$	~~(301,235~~407	)	$	24138,~~670~~758	$	(~~518~~517,~~376~~969	)
Net income from discontinued operations		-			~~68,358~~-			-		68,358
Net income (loss) attributable to common shareholders	$	~~178~~114,~~326~~088		$	~~(232,877~~407	)	$	24138,~~670~~758	$	(~~450~~449,~~018~~611	)
Income (loss) per share – continuing operations – basic and diluted	$	0.00		$	0.00		$	0.00	$	(0.01	)
Income (loss) per share discontinued operations – basic and diluted		0.00			0.00			0.00		(0.00	)
Basic and diluted income (loss) per share	$	0.00		$	0.00		$	0.00	$	(0.01	)
Weighted average number of shares outstanding- basic and diluted*		93,726,994			8387,~~670~~309,~~840~~961			93,726,994		8384,~~603~~835,~~917~~023
Other comprehensive income (loss):
Net income (loss)	$	~~178~~114,~~326~~088		$	~~(232,877~~407	)	$	24138,~~670~~758	$	(~~450~~449,~~018~~611	)
Foreign currency translation adjustment		5(60,~~681~~220	)		~~127~~(74,~~257~~897	)		~~128~~68,~~605~~385		~~238~~163,~~090~~193
Comprehensive income (loss)		~~184~~53,~~007~~868			(~~105~~74,~~620~~490	)		~~153~~207,~~275~~143		(~~211~~286,~~928~~418	)
Less: comprehensive income attributable to non-controlling interests		-			-			-		3,672
Comprehensive income (loss) attributable to the common shareholders	$	~~184~~53,~~007~~868		$	(~~105~~74,~~620~~490	)	$	~~153~~207,~~275~~143	$	(~~215~~290,~~600~~090	)

The accompanying notes are an integral part of these condensed consolidated financial statements

F-2

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ ~~(DEFICIT)~~ EQUITY

FOR THE ~~SIX~~NINE MONTHS ENDED ~~SEPTEMBER~~DECEMBER 3031, 2023 AND 2022

(UNAUDITED) (EXPRESSED IN US DOLLARS, EXCEPT SHARES)

	Common stock *				Additional Paid-in		Subscription						Other Comprehensive Income			Total Shareholders’ ~~Equity~~			Non- controlling			Total Shareholders’ Equity ~~(Deficit)~~
	Quantity		Amount		Capital		Receivable			(Deficit)			(Loss)			~~(Deficit)~~Equity			Interest			and NCI
Balance at March 31, 2022		83,536,994	$	83,537	$	4,266,611	$	-		$	(3,803,720	)	$	(173,204	)	$	373,224		$	(69,349	)	$	303,875
Net (loss)		-		-		-		-			(217,141	)		-			(217,141	)		-			(217,141	)
Foreign currency translation adjustment		-		-		-		-			-			107,161			107,161			3,672			110,833
Balance at June 30, 2022 (unaudited)		83,536,994		83,537		4,266,611		-			(4,020,861	)		(66,043	)		263,244			(65,677	)		197,567
Net (loss)		-		-		-		-			(232,877	)		-			(232,877	)		-			(232,877	)
Shares issued		140,000		140		12,446		-			-			-			12,586			-			12,586
Foreign currency translation adjustment		-		-		-		-			-			127,257			127,257			-			127,257
Divestment of Tianci Wanguan		-		-		-		-			2,977			(2,977	)		-			65,677			65,677
Balance at September 30, 2022 (unaudited)		83,676,994	$	83,677	$	4,279,057	$	-		$	(4,250,761	)	$	58,237		$	170,210		$	-		$	170,210
Net income		-		-		-		-			407			-			407			-			407
Shares issued as compensation		50,000		50		4,350		-			-			-			4,400			-			4,400
Sale of common shares		10,000,000		10,000		870,000		(866,032	)		-			-			13,968			-			13,968
Foreign currency translation adjustment		-		-		-		-			-			(74,897	)		(74,897	)		-			(74,897	)
Balance at December 31, 2022 (unaudited)		93,726,994	$	93,727	$	5,153,407	$	(866,032	)	$	(4,250,354	)	$	(16,660	)	$	114,088		$	-		$	114,088
Balance at March 31, 2023		93,726,994	$	93,727	$	5,153,407	$	(838,095	)	$	(4,359,869	)	$	(25,944	)	$	23,226		$	-		$	23,226
Net (loss)		-		-		-		-			(153,656	)		-			(153,656	)		-			(153,656	)
Payment received		-		-		-		6,984			-			-			6,984			-			6,984
Foreign currency translation adjustment		-		-		-		-			-			122,924			122,924			-			122,924
Balance at June 30, 2023 (unaudited)		93,726,994		93,727		5,153,407		(831,111	)		(4,513,525	)		96,980			(522	)		-			(522	)
Net income		-		-		-		-			178,326			-			178,326			-			178,326
Payment received		-		-		-		125,715			-			-			125,715			-			125,715
Foreign currency translation adjustment		-		-		-		-			-			5,681			5,681			-			5,681
Balance at September 30, 2023 (unaudited)		93,726,994	$	93,727	$	5,153,407	$	(705,396	)	$	(4,335,199	)	$	102,661		$	309,200		$	-		$	309,200
Net income		-		-		-		-			114,088			-			114,088			-			114,088
Foreign currency translation adjustment		-		-		-		-			-			(60,220	)		(60,220	)		-			(60,220	)
Balance at December 31, 2023 (unaudited)		93,726,994	$	93,727	$	5,153,407	$	(705,396	)	$	(4,221,111	)	$	42,441		$	363,068		$	-		$	363,068

The accompanying notes are an integral part of these condensed consolidated financial statements

F-3

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE ~~SIX~~NINE MONTHS ENDED ~~SEPTEMBER~~DECEMBER 3031, 2023 AND 2022

(UNAUDITED) (EXPRESSED IN US DOLLARS)

	For the Six Months Ended September 30,
	For the Nine Months Ended December 31,
	2023			2022
Cash Flows from Operating Activities
Net income (loss) from continuing operations	$	24138,~~670~~758		$	(~~518~~517,~~376~~969	)
Net income from discontinued operations		-			68,358
Shares issued as compensation		-			1216,~~586~~986
Depreciation and amortization		-			-
Gain on sale of discontinued operations		-			(68,359	)
Exchange loss		~~139~~59,~~643~~204			~~268~~192,~~389~~194
Changes in operating assets and liabilities, discontinued operations		-			(5,381	)
Changes in operating assets and liabilities, continuing operations:
Accounts receivable		(12296,~~521~~490	)		(76,~~659~~331	)
Prepaid and deferred expenses		(1715,~~598~~831	)		1519,~~207~~944
Inventories		(~~200~~1,~~984~~036	)		3732,~~489~~003
Other receivables		(193,~~279~~170	)		(161,~~830~~372	)
Accounts payable and accrued expenses		(3145,~~855~~460	)		(2935,~~017~~138	)
Customer deposits		10,~~082~~072			~~1,497~~(502	)
Due to (from) related parties		2330,~~207~~913			(3,~~552~~013	)
Other payables		-1,870			(~~124~~112	)
Net cash (used in) operating activities		(84121,~~635~~170	)		(~~245~~308,~~772~~692	)
Cash Flows from Investing Activities
Cash disbursed on divestment of Tianci Wanguan		-			(288	)
Net cash (used in) investing activities		-			(288	)
Cash Flows from Financing Activities
Proceeds from sale of common stock		132,699			-13,968
Net cash provided by financing activities		132,699			-13,968
Effect of exchange rate fluctuations on cash		(~~2,785~~904	)		(29,~~727~~485	)
Net increase (decrease) in cash		4510,~~279~~625			(~~275~~324,~~787~~497	)
Cash, beginning of period-continuing operations		49,862			402,449
Cash, beginning of period-discontinued operations		-			6,014
Cash, beginning of period		49,862			408,463
Cash, end of period-continuing operations		9560,~~141~~487			~~132~~83,~~676~~966
Cash, end of period-discontinued operations		-			-
Cash, end of period	$	9560,~~141~~487		$	~~132~~83,~~676~~966
Supplemental disclosure of cash flow information:
Cash paid for income taxes	$	-		$	-
Cash paid for interest	$	-		$	-
Supplemental disclosure of non-cash activities:
Gain on sale of discontinued operations	$	-		$	68,359
Shares issued for compensation	$	-		$	16,986
Issuance of common stock as cash was not received	$	-		$	866,032

The accompanying notes are an integral part of these condensed consolidated financial statements.

F-4

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) (AMOUNTS IN US DOLLARS)

NOTE 1. NATURE OF OPERATIONS AND BASIS OF PRESENTATION

Organic Agricultural Company Limited (“Organic Agricultural”, the “Company”, “we” or “us”) was incorporated in the State of Nevada on April 17, 2018.

The Company, through its subsidiaries with headquarters in Harbin, China, sells selenium-enriched products and other agricultural products. At ~~September~~December 3031, 2023, the Company’s subsidiaries are as follows:

●

Organic Agricultural (Samoa) Co., Ltd. (“Organic Agricultural Samoa”), a limited company incorporated in Samoa on December 15, 2017, is wholly owned by Organic Agricultural. Organic Agricultural Samoa owns all of the outstanding shares of capital stock of Organic Agricultural Company Limited (Hong Kong).

●

Organic Agricultural Company Limited (Hong Kong) (“Organic Agricultural HK”), which was established on December 6, 2017 under the laws of Hong Kong, is wholly owned by Organic Agricultural Samoa. Organic Agricultural HK owns all of the registered equity of Heilongjiang Tianci Liangtian Agricultural Technology Development Company Limited.

●

Heilongjiang Tianci Liangtian Agricultural Technology Development Company Limited. (“Tianci Liangtian”), a company incorporated in Heilongjiang, China on November 2, 2017, is wholly owned by Organic Agricultural HK. Tianci Liangtian owns all of the registered equity of Heilongjiang Yuxinqi Agricultural Technology Development Company Limited.

● Heilongjiang Yuxinqi Agricultural Technology Development Company Limited (“Yuxinqi”), a company incorporated in Heilongjiang, China on February 5, 2018, is wholly owned by Tianci Liangtian. Yuxinqi sells agricultural products, including paddy and other crops, to customers.

	●	Heilongjiang Yuxinqi Agricultural Technology Development Company Limited (“Yuxinqi”), a company incorporated in Heilongjiang, China on February 5, 2018, is wholly owned by Tianci Liangtian. Yuxinqi sells agricultural products, including paddy and other crops, to customers.

	●	Qingdao Tianci Liangtian Agricultural Technology Development Company Limited. (“Qingdao Tianci”), a company incorporated in Shandong, China on December 29, 2023, is wholly owned by Tianci Liangtian.

F-5

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) (AMOUNTS IN US DOLLARS)

NOTE 1. NATURE OF OPERATIONS AND BASIS OF PRESENTATION (Continued)

Divestment of Tianci Wanguan

On November 6, 2020 Organic Agricultural entered into a Cooperation Agreement with Unbounded IOT Block Chain Limited (“Unbounded”). The purpose of the Cooperation Agreement was to promote the use of blockchain technology in agriculture, specifically the development of tracing systems for agricultural products, the development of a blockchain-based shopping mall for agricultural products, and related improvements to the agricultural sector of the economy. To accomplish those purposes, Tianci Wanguan (Xiamen) Digital Technology Co., Ltd. (“Tianci Wanguan”) was incorporated on November 5, 2020. Tianci Wanguan was 51% owned by Organic Agricultural HK and 49% owned by Chen Zewu on behalf of Unbounded. On July 19, 2021 the parties executed a Supplementary Agreement to the Cooperation Agreement.

The Supplementary Agreement set forth performance criteria for Unbounded’s management of Tianci Wanguan: specifically that within 12 months after the shares mentioned below are issued to Unbounded, Tianci Wanguan must generate a profit of five million Renminbi (approximately US$774,000) from the business described in the Cooperation Agreement or any other business approved by Organic Agricultural. On November 23, 2021, Organic Agricultural issued 10 million shares of its common stock to Chen Zewu, who held them as agent for Unbounded. If Unbounded failed to satisfy the criteria described above, the 10 million shares must be returned to Organic Agricultural. If Unbounded did satisfy the criteria, then it would have unrestricted ownership of the 10 million shares, and Organic Agricultural would issue an additional 10 million shares to Unbounded. According to FASB ASC 505-50-S99-1 and 2, as the 10,000,000 shares issued on November 23, 2021 were unvested and forfeitable, these shares were treated as unissued until they vest when the target described above was met.

The share-based compensation was measured at grant date, based on the fair value of the award and would be recognized over its vesting period if it was determined that the target would more likely than not be met. After the criteria described above was satisfied, the Company would grant to Unbounded a total of 20,000,000 shares, including the 10,000,000 shares issued on November 23, 2021, with a fair value on the grant date, which is July 19, 2021, of $0.0969 per share. If the performance condition described above was satisfied, $1,938,000 in compensation expense would have been recognized under the provisions of ASC 718.

As of June 30, 2022, the Company had suspended the operations of Tianci Wanguan and on August 19, 2022, completed the divestment of its subsidiary. On August 19, 2022, the Company and Unbounded entered into an Agreement on Termination of Joint Operation. The parties agreed that Organic Agricultural would surrender to Unbounded its 51% interest in Tianci Wanguan, and Unbounded would return the 10 million shares to Organic Agricultural. The 10,000,000 shares previously issued on November 23, 2021 were returned and cancelled with no compensation expense recognized.

In accordance with U.S. GAAP, the financial position and results of operations of Tianci Wanguan are presented as discontinued operations and, as such, have been excluded from continuing operations for all periods presented. The restated historical financial statements reflecting the divestment are unaudited. The cash flows and comprehensive income related to Tianci Wanguan have not been segregated and are included in the Condensed Consolidated Statements of Cash Flows and Comprehensive Income, respectively, for all periods presented. With the exception of Note 3, the Notes to the Unaudited Condensed Consolidated Financial Statements reflect the continuing operations of the Company. See Note 3 - Discontinued Operations below for additional information regarding discontinued operations.

Certain amounts in the prior year’s condensed consolidated financial statements and related footnotes thereto have been reclassified to conform with the current year presentation as a result of the divestment of Tianci Wanguan.

F-6

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) (AMOUNTS IN US DOLLARS)

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Going concern

Management has determined there is substantial doubt about our ability to continue as a going concern as a result of our lack of significant revenues and recurring losses. If we are unable to generate significant revenue or secure additional financing, we may be required to cease or curtail our operations. Our financial statements do not include any adjustments that might result from the outcome of this uncertainty.

The Company’s operations have been financed primarily by proceeds from the sale of shares. The Company sold an additional 10 million shares of its common stock to two subscribers in November 2022 for aan aggregate price of $880,000 USD, with the payments for the shares scheduled to be paid before October 16, 2024. ~~Heilongjiang~~ Heilongjiang Chuangyi, one of the subscribers, ~~had~~has paid $174,604, and agreed to pay the remaining proceeds of $617,396 on or before October 16, 2024. The Company will use these funds for working capital. On January 30, 2024, Sun Ying, ~~and~~ the ~~Company~~other subscriber, entered into an agreement with the Company that cancelled ~~the~~ their Shares Increase Contract. pursuant to which Sun Ying had committed to pay $88,000 for 1,000,000 shares. Sun Ying agreed to surrender the shares to the ~~Registrant~~Company for cancellation.

The marketing personnel of the Company are developing new customers and hope to build a stable base of customers. In this manner, Management hopes to generate sufficient operating cash inflow to support its future operations and development of the Company in addition to capital raised from sales of shares and shareholders’ support based on need.

Basis of presentation

The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments of a normal and recurring nature considered necessary for a fair presentation have been included in the accompanying condensed consolidated financial statements. The results of operations for the interim period are not necessarily indicative of the results that will be realized for the entire fiscal year. These condensed consolidated financial statements should be read in conjunction with Organic Agricultural Company’s audited financial statements and accompanying notes thereto as of and for the year ended March 31, 2023 included in Company’s current report on Form 10-K as filed with the SEC on November 17, 2023.

The Company’s condensed consolidated financial statements are expressed in U.S. Dollars and are presented in accordance with U.S. GAAP.

Principles of consolidation

The condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All significant inter-company accounts and transactions have been eliminated in consolidation. The condensed consolidated financial statements include the assets, liabilities, and net income or loss of these subsidiaries.

The Company’s subsidiaries as of ~~September~~December 3031, 2023 are listed as follows:

Name	Place of Incorporation	Attributable equity interest %
Organic Agricultural (Samoa) Co., Ltd.	Samoa		100
Organic Agricultural Company Limited (Hong Kong)	Hong Kong		100
Heilongjiang Tianci Liangtian Agricultural Technology Development Company Limited	China		100
Heilongjiang Yuxinqi Agricultural Technology Development Company Limited	China		100
Qingdao Tianci Liangtian Agricultural Technology Development Company Limited	China		100

F-7

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) (AMOUNTS IN US DOLLARS)

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Use of estimates

The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting periods. Management makes these estimates using the best information available at the time the estimates are made; however, actual results could differ from those estimates. Significant items subject to such estimates and assumptions include the inventory valuation allowance. This estimate is often based on complex judgments and assumptions that management believes to be reasonable but are inherently uncertain and unpredictable. Actual results could differ from these estimates.

Cash

Cash consists of cash on hand and bank deposits, which are unrestricted as to withdrawal and use in the PRC and the USA. All highly liquid investments with original stated maturities of three months or less are classified as cash. The Company’s cash consisted of cash on hand and cash in bank, as of ~~September~~December 3031, 2023 and March 31, 2023.

Revenue recognition

The Company follows the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 606 — Revenue from Contracts with Customers. Under ASC 606, the Company recognizes revenue from the commercial sales of products and contracts by applying the following steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to each performance obligation in the contract; and (5) recognize revenue when each performance obligation is satisfied.

The Company recognizes revenue when the amount of revenue can be reliably measured, it is probable that economic benefits will flow to the entity, and specific criteria have been met for each of the Company’s activities as described below.

The Company sells paddy and selenium-enriched paddy products, rice and other agricultural products. All revenue is recognized when it is both earned and realized. The Company’s policy is to recognize the sale when the products and services, ownership and risk of loss have transferred to the purchasers, and collection of the sales proceeds, if not prepaid, is reasonably assured, all of which generally occur when the customer receives the products and services. Accordingly, revenue is recognized at the point in time when delivery is made and services are provided.

Given the nature of this revenue generated by the Company’s business and the applicable rules guiding revenue recognition, the Company’s revenue recognition practices do not include estimates that materially affect results of operations nor does the Company have any policy for return of products.

Fair value measurements

The Company applies the provisions of FASB ASC 820, Fair Value Measurements for fair value measurements of financial assets and financial liabilities and for fair value measurements of nonfinancial items that are recognized or disclosed at fair value in the financial statements. ASC 820 also establishes a framework for measuring fair value and expands disclosures about fair value measurements.

Fair value is defined as the price that would be received when selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In determining the fair value for the assets and liabilities required or permitted to be recorded, the Company considers the principal or most advantageous market in which it would transact, and it considers assumptions that market participants would use when pricing the asset or liability.

F-8

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) (AMOUNTS IN US DOLLARS)

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

ASC 820 establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes three levels of inputs that are to be used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to measurements involving significant unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows:

Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;

Level 2: Quoted prices, other than those in Level 1, in markets that are not active or for similar assets and liabilities, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability;

Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity).

Financial assets and liabilities of the Company primarily consists of cash, accounts receivable, prepaid expenses, inventories, other receivables, accounts payable and accrued liabilities, customer deposits, due to or from related parties, and other payables. As at ~~September~~December 3031, 2023 and March 31, 2023, the carrying values of these financial instruments approximated their fair values due to the short-term nature of these instruments.

Functional currency and foreign currency translation

An entity’s functional currency is the currency of the primary economic environment in which it operates. Normally that is the currency of the environment in which the entity primarily generates and expends cash. Management’s judgment is essential to determine the functional currency by assessing various indicators, such as cash flows, sales price and market, expenses, financing and inter-company transactions and arrangements. The functional currency of the Company is the Chinese Renminbi (“RMB’), except the functional currency of Organic Agricultural HK is the Hong Kong Dollar (“HKD”), and the functional currency of Organic Agricultural Samoa and Organic Agricultural is the United States dollar (“US Dollars” “USD” or “$”). The reporting currency of these condensed consolidated financial statements is in US Dollars.

The financial statements of the Company, which are prepared using the RMB and the HKD, are translated into the Company’s reporting currency, the US Dollar. Assets and liabilities are translated using the exchange rate at each reporting period end date. Revenue and expenses are translated using average rates prevailing during each reporting period, and shareholders’ equity is translated at historical exchange rates. Adjustments resulting from the translation are recorded as a separate component of accumulated other comprehensive income or loss.

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 transactions. Foreign currency exchange gains and losses resulting from these transactions are included in operations.

The exchange rates used for foreign currency translation are as follows:

For the three months ended September 30,

March 31,

For the three months ended December 31,

March 31,

2023

2022

2023

(USD to RMB/USD to HKD)

(USD to RMB/ USD to HKD)

Assets and liabilities - period end exchange rate

7.~~2952~~0798/7.~~8315~~8085

76.~~1128~~8983/7.~~8499~~8088

6.8680/7.8498

Revenue and expenses - period average

7.~~1232~~2052/7.~~8318~~8138

67.~~8456~~1111/7.~~8480~~8227

N/A

	For the six months ended September 30,
	For the nine months ended December 31,
	2023		2022
	(USD to RMB/USD to HKD)		(USD to RMB/USD to HKD)
	(USD to RMB/ USD to HKD)		(USD to RMB/ USD to HKD)
Assets and liabilities - period end exchange rate		7.~~2952~~0798/7.~~8315~~8085		76.~~1128~~8983/7.~~8499~~8088
Revenue and expenses - period average		7.~~2364~~1506/7.~~8243~~8258		6.~~7274~~8557/7.~~8471~~8390

F-9

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) (AMOUNTS IN US DOLLARS)

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Income taxes

The Company follows FASB ASC Topic 740, Income Taxes, which requires the recognition of deferred income taxes for the differences between the basis of assets and liabilities for financial statements and income tax purposes. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Deferred tax assets are also recognized for operating losses and for tax credit carryforwards. A valuation allowance is established, when necessary, to reduce net deferred tax assets to the amount expected to be realized.

ASC 740-10-30 requires income tax positions to meet a more-likely-than-not recognition threshold to be recognized in the financial statements. Under ASC 740-10-40, previously recognized tax positions that no longer meet the more-likely-than-not threshold should be derecognized in the first subsequent financial reporting period in which that threshold is no longer met.

The application of tax laws and regulations is subject to legal and factual interpretations, judgments and uncertainties. Tax laws and regulations themselves are subject to change as a result of changes in fiscal policies, changes in legislation, the evolution of regulations and court rulings. Therefore, the actual liability may be materially different from our estimates, which could result in the need to record additional tax liabilities or potentially reverse previously recorded tax liabilities or the net deferred tax asset valuation allowance.

China

According to the “PRC Income Tax Law”, Tianci Liantian, Qingdao Tianci and Yuxinqi are subject to the 25% standard enterprise income tax rate in the PRC.

United States

The Company is subject to the U.S. corporation tax rate of 21%.

Samoa

Organic Agricultural (Samoa) Co., Ltd was incorporated in Samoa and, under the current laws of Samoa, it is not subject to income tax.

Hong Kong

Organic Agricultural Company Limited (Hong Kong) was incorporated in Hong Kong and is subject to Hong Kong profits tax. Organic Agricultural Company Limited (Hong Kong) is subject to Hong Kong taxation on its activities conducted in Hong Kong and income arising in or derived from Hong Kong. The applicable statutory tax rate is 16.5%.

Earnings (loss) per share

The Company computes earnings (loss) per share (“EPS”) in accordance with FASB ASC 260, Earnings Per Share. ASC 260 requires companies with complex capital structures to present basic and diluted EPS. Basic EPS is measured as net income (loss) divided by the weighted average common shares outstanding during the period. Stock splits are given retroactive recognition for earnings (loss) per share.

Diluted EPS is similar to basic EPS but presents the dilutive effect on a per share basis of contracts to issue ordinary common shares (e.g., convertible securities, options and warrants) as if they had been converted at the beginning of the periods presented, or issuance date, if later. The computation of diluted EPS includes the estimated impact of the exercise of contracts to purchase common stock using the treasury stock method and the potential common shares associated with convertible debt using the if-converted method. Potential common shares that have an anti-dilutive effect (i.e., those that increase earnings per share or decrease loss per share) are excluded from the calculation of diluted EPS.

F-10

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) (AMOUNTS IN US DOLLARS)

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Segment information and geographic data

The Company is operating in one segment in accordance with the accounting guidance in FASB ASC Topic 280, Segment Reporting. The Company’s revenues are from the sales of agricultural products to customers in the People’s Republic of China (“PRC”). All assets of the Company are located in the PRC.

Concentration of credit and customer risks

The Company maintains cash balances in two banks in China. In China, the insurance coverage of each bank is RMB500,000 (approximately US$6971,000). As of ~~September~~December 3031, 2023, the Company had no cash on deposit in excess of the insurance amounts.

During the ~~six~~nine months ended ~~September~~December 3031, 2022, ~~three~~two customers, Jiufu Zhenyuan, and Chuangyi Agriculture ~~and Qingdao Huadao,~~ generated 4560%, ~~15%~~ and 1013% of our revenues, respectively. During the ~~six~~nine months ended December ~~September 30~~31, 2023, one customer, Yuanzheng, generated 9796% of our revenues.

Recently adopted accounting standards

We do not believe any recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on the condensed consolidated financial position, statements of operations and cash flows.

F-11

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) (AMOUNTS IN US DOLLARS)

NOTE 3. DISCONTINUED OPERATIONS

As discussed in Note 1: Basis of Presentation above, on August 19, 2022 the Company completed the divestment of Tianci Wanguan and the requirements for the presentation of Tianci Wanguan as a discontinued operation were met on that date. Accordingly, Tianci Wanguan’s historical financial results are reflected in the Company’s unaudited condensed consolidated financial statements as discontinued operations. The Company did not allocate any general corporate overhead or interest expense to discontinued operations.

The financial results of Tianci Wanguan are presented as income (loss) from discontinued operations, net of income taxes in the unaudited condensed consolidated statements of operations. The following table presents the financial results of Tianci Wanguan.

	For the Three months ended September 30, 2022		For the Six months ended September 30, 2022
	For the Three months ended December 31, 2022		For the Nine months ended December 31, 2022
		(Unaudited )		(Unaudited)
	(Unaudited)		(Unaudited)
Net sales	$	-	$	-
Cost of sales		-		-
Gross profit		-		-
Selling, general and administrative expenses		-		1
Operating (loss)		-		(1	)
Other income		-		-
(Loss) before income taxes		-		(1	)
Income tax (expense) benefit		-		-
(Loss) from discontinued operations, net of income taxes		-		(1	)
Less: Net (loss) attributable to non-controlling interest		-		-
Net (loss) from discontinued operations attributable to controlling interest	$	-	$	(1	)

F-12

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) (AMOUNTS IN US DOLLARS)

NOTE 4. PREPAID EXPENSES

Prepaid expenses include prepayments for expenses, and prepayments of processing charges and products to be purchased. As of ~~September~~December 3031, 2023 and March 31, 2023, prepayments and deferred expenses were as follows:

	September 30, 2023		March 31, 2023
	December 31, 2023		March 31, 2023
	(Unaudited)
Prepayments for expenses	$	1711,~~330~~512	$	-
Prepayments of processing charges and products to be purchased:
Baoqing County Fengnian Agricultural Product Purchase and Sale Ltd.		5,~~137~~293		5,456
Harbin Huichuan Package Products Co., ltd		~~274~~1,879		-
Others		~~291~~3,332		756
Total		2322,~~032~~016		6,212
Less: Provision for bad debts		5,~~137~~293		5,456
Prepaid expenses, net	$	1716,~~895~~723	$	756

NOTE 5. INVENTORIES

The Company’s inventories are all non-perishable products. The Company’s inventory consists principally of rice and other products which are vacuum-packed and have more than one year shelf life. The Company reviews its products and sells products near the end of their shelf life through promotions. As of ~~September~~December 3031, 2023 and March 31, 2023, no reserve was considered necessary. The Company values inventory on its balance sheet at the lower of cost or net realizable value. Inventories consisted of the following:

	September 30, 2023		March 31, 2023
	December 31, 2023		March 31, 2023
	(Unaudited)
Rice and other products	$	~~255~~100,~~265~~003	$	119,233
Packing and other materials		8146,~~969~~321		30,524
Total inventories at cost	$	~~337~~146,~~234~~324	$	149,757

F-13

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) (AMOUNTS IN US DOLLARS)

NOTE 6. INCOME TAXES

A reconciliation of the income (loss) before income taxes for domestic and foreign locations for the three and ~~six~~nine months ended ~~September~~December 3031, 2023 and 2022 is as follows:

	For the three months ended September 30,
	For the three months ended December 31,
	2023			2022
	(Unaudited)			(Unaudited)
United States	$	(616,~~554~~239	)	$	(4030,~~680~~616	)
Foreign		~~184~~130,~~880~~327			~~(260~~31,~~556~~023	)
Income (loss) before income taxes	$	~~178~~114,~~326~~088		$	~~(301,236~~407	)

	For the six months ended September 30,
	For the nine months ended December 31,
	2023			2022
	(Unaudited)			(Unaudited)
United States	$	(3450,~~173~~412	)	$	(6191,~~150~~766	)
Foreign		58189,~~843~~170			(~~457~~426,~~226~~203	)
Income (loss) before income taxes	$	24138,~~670~~758		$	(~~518~~517,~~376~~969	)

The difference between the U.S. federal statutory income tax rate and the Company’s effective tax rate was as follows:

	September 30, 2023			September 30, 2022
	December 31, 2023			December 31, 2022
	(Unaudited)			(Unaudited)
U.S. federal statutory income tax rate		21	%		21	%
U.S. valuation allowance		(21	)%		(21	)%
The Company’s effective tax rate		(0	)%		(0	)%

F-14

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) (AMOUNTS IN US DOLLARS)

NOTE 6. INCOME TAXES (Continued)

	September 30, 2023			September 30, 2022
	December 31, 2023			December 31, 2022
	(Unaudited)			(Unaudited)
Rates for Tianci Liangtian, and Yuxinqi, net		25	%		25	%
Rates for Tianci Liangtian, Qingdao Tianci and Yuxinqi, net		25	%		25	%
Utilization of net operating loss carryforward		(2524	)%		-
PRC valuation allowance		-			(25	)%
The Company’s effective (benefit) tax rate		(01	)%		(0	)%

The Company did not recognize deferred tax assets since it is not likely to incur taxes against which such deferred tax assets may be offset. The deferred tax assets would apply to the Company in the U.S. and to Yuxinqi and Tianci Liangtian in China.

As of ~~September~~December 3031, 2023, Yuxinqi, Qingdao Tianci and Tianci Liangtian have total net operating loss carry forwards of approximately $~~513~~435,~~039~~717 in the PRC that expire in 2028. Due to the uncertainty of utilizing these carry forwards, the Company provided a 100% valuation allowance on the net deferred tax assets of approximately $~~128~~108,~~260~~929 and $185,852 related to its operations in the PRC as of ~~September~~December 3031, 2023 and March 31, 2023, respectively. The PRC valuation allowance decreased by approximately $5877,000 for the ~~six~~nine months ended ~~September~~December 3031, 2023. The profit of $~~201~~270,~~166~~890 from Yuxinqi caused the decrease in valuation allowance for the ~~six~~nine months ended ~~September~~December 3031, 2023.

The Company incurred losses from its United States operations during all periods presented of approximately $1,~~644~~660,000. The Company’s United States operations consist solely of ownership of its foreign subsidiaries, and the losses arise from administrative expenses and shares issued as compensation. Accordingly, management provided a 100% valuation allowance of approximately $~~345~~349,000 and $338,000 against the net deferred tax assets related to the Company’s United States operations as of ~~September~~December 3031, 2023 and March 31, 2023, respectively, because the deferred tax benefits of the net operating loss carry forwards in the United States will not likely be realized. The US valuation allowance increased by approximately $711,000 for the ~~six~~nine months ended ~~September~~December 3031, 2023.

The Company is subject to examination by the Internal Revenue Service (IRS) in the United States as well as by the taxing authorities in China, where the Company has its operations. The tax years subject to examination vary by jurisdiction. The table below presents the earliest tax years that remain subject to examination by jurisdiction.

			The year as of
U.S. Federal			March 31, 2020
China			December 31, 2019

F-15

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) (AMOUNTS IN US DOLLARS)

NOTE 7. CUSTOMER DEPOSITS

Customer deposits consisted of the following:

	September 30, 2023		March 31, 2023
	December 31, 2023		March 31, 2023
	(Unaudited)
Shouhang	$	4850,~~983~~473	$	52,030
Beiqinhai		9396,~~431~~275		99,242
Others		910,~~998~~331		163
Total customer deposits	$	~~152~~157,~~412~~079	$	151,435

NOTE 8. RELATED PARTY TRANSACTIONS

Amounts due to related parties consisted of the following as of the periods indicated:

	September 30, 2023		March 31, 2023
	December 31, 2023		March 31, 2023
	(Unaudited)
Tianzhi	$	2725,~~415~~425		-
Shen Zhenai		~~448~~421		511
Heilongjiang Chuangyi		53-		215
	$	2725,~~916~~846	$	726

Shen Zhenai is the President, Chairman of the Board, director and a shareholder of the Company. These advances represent temporary borrowings for operating costs between the Company and management. They are non-interest bearing and due on demand.

Heilongjiang Chuangyi Agriculture Co., Ltd (“Heilongjiang Chuangyi”) owns 9.60% of the Company. The advances represent advances for purchases from the Company in the future. During the ~~six~~nine months ended ~~September~~December 3031, 2023, Heilongjiang Chuangyi purchased agricultural products from the Company totaling $429,~~638~~805.

Tianzhi Equity Investment Fund Management (Shanghai) Co., Ltd. (“Tianzhi”) is controlled by Shen Zhenai, the president and chairman of the Board of the Company.

Amounts due from related parties consisted of the following as of the periods indicated:

	September 30, 2023		March 31, 2023
	December 31, 2023		March 31, 2023
	(Unaudited)
Jiufu Zhenyuan	$	3,033	$	324
Wu Zhiwei	$	1,413	$	-
	$	3,033	$	324
Heilongjiang Chuangyi		871		-
Jiufu Zhenyuan		-	$	324
	$	2,284	$	324

~~The~~Wu ~~amount~~Zhiwei ~~due~~is ~~from~~the ~~Jiufu~~CEO ~~Zhenyuan~~and ~~was~~a ~~account~~director of the Company, ~~receivable~~and ~~from~~is ~~sales~~also ~~transactions~~a ~~between~~shareholder of Heilongjiang Chuangyi. This payment represent temporary loan for operating costs to management. As of the reporting ~~Company~~date, ~~and~~these ~~Jiufu~~funds ~~Zhenyuan~~have been used and reimbursed.

~~Jilin~~The ~~Jiufu~~amount ~~Zhenyuan~~due ~~Technology~~from ~~Development~~Heilongjiang ~~Co, Ltd~~Chuangyi (“and Jiufu Zhenyuan”) ~~owns~~was ~~22.68%~~account ofreceivable ~~the~~from ~~Company~~sales ~~and~~transactions ~~its~~between ~~President is a member of~~ the Company’s ~~Board~~and ofHeilongjiang ~~Directors. The~~Chuangyi ~~advances~~and ~~represent advances for purchases from the Company in the future. During the six months ended September 30, 2023,~~ Jiufu Zhenyuan ~~purchased agricultural products from the Company totaling $3,277~~.

Jilin Jiufu Zhenyuan Technology Development Co, Ltd (“Jiufu Zhenyuan”) owns 22.68% of the Company and Jiufu Zhenyuan’s President was, until January 3, 2024, a member of the Company’s Board of Directors. The advances represent advances for purchases from the Company in the future. During the nine months ended December 31, 2023, Jiufu Zhenyuan purchased agricultural products from the Company totaling $7,751.

F-16

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) (AMOUNTS IN US DOLLARS)

NOTE 9. LEASE

On April 1, 2019, the Company adopted FASB ASC 842, “Leases” (“new lease standard”). The new lease standard was adopted using the optional transition method approach that allows for the cumulative effect adjustment to be recorded without restating prior periods. The Company has elected the practical expedient package related to the identification, classification and accounting for initial direct costs whereby prior conclusions do not have to be reassessed for leases that commenced before the effective date. As the Company will not reassess such conclusions, the Company has not adopted the practical expedient to use hindsight to determine the likelihood of whether a lease will be extended or terminated or whether a purchase option will be exercised.

Operating leases are reflected on our balance sheet within “operating lease right-of-use asset.” Right-of use (“ROU”) assets and the related operating lease liabilities represent the right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make lease payments arising from the lease agreement. ROU assets and liabilities are recognized at the commencement date, or the date on which the lessor makes the underlying asset available for use, based upon the present value of the lease payments over the respective lease term. Lease expense is recognized on a straight-line basis over the lease term, subject to any changes in the lease regarding the terms.

The Company’s adoption of the new lease standard included new processes and controls regarding asset financing transactions, financial reporting and a system-related implementation required for the new lease standard. The impact of the adoption of the new lease standard included the recognition of right-of-use (“ROU”) asset and lease liabilities.

Leases with an initial term of 12 months or less are not recorded on the balance sheet. Operating lease cost is recognized as a single lease cost on a straight-line basis over the lease term and is recorded in selling, general and administrative expenses.

On March 23, 2022, Yuxinqi leased office space from March 23, 2022 to March 22, 2023 under an operating lease agreement (approximately 337.3 square meters). Under the terms of the lease, Yuxinqi committed to make annual lease payments of RMB136,606.50 (approximately US$19,000, including VAT tax). The government of Harbin issued policy on house rent relief for small, medium and micro enterprises and individual industrial and commercial households, and Yuxinqi got a three months rent-free period after March 22, 2023. On July 5, 2023, Yuxinqi renewed the operating lease agreement for the period from June 23, 2023 to June 22, 2024. Under the terms of the lease, Yuxinqi committed to make annual lease payments of RMB136,607 (approximately US$19,000, including VAT tax). The annual payment was fully paid and the payment was recorded as prepaid expenses, since it is a short-term lease.

For the ~~six~~nine months ended ~~September~~December 3031, 2023 and 2022, the amortization of lease expenses ~~were~~was US$711,~~373~~762 and US$913,~~366~~811, respectively.

F-17

ORGANIC AGRICULTURAL COMPANY LIMITED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) (AMOUNTS IN US DOLLARS)

NOTE 10. SUBSCRIPTION RECEIVABLE

Subscription receivable consisted of the following commitments to purchase common stock as of the periods indicated:

	September 30, 2023		March 31, 2023
	December 31, 2023		March 31, 2023
	(Unaudited)
Sun Ying	$	88,000	$	74,032
Heilongjiang Chuangyi Agriculture Co., Ltd.		617,396		764,063
	$	705,396	$	838,095

On November 28, 2022 the Company entered into an agreement to sell 9,000,000 shares of its common stock to Heilongjiang Chuangyi Agriculture Co., Ltd. for a price of 5,670,000 RMB (US$792,000). The Company received partial proceeds of $27174,~~937~~604 ~~as of March 31, 2023 and additional partial proceeds of $146,667~~ from Heilongjiang Chuangyi Agriculture Co., Ltd. as of ~~September~~December 3031, 2023. The remaining balance is due on or before October 16, 2024.

On November 29, 2022 the Registrant entered into an agreement to sell 1,000,000 shares of its common stock to Sun Ying for a price of 630,000 RMB (US$88,000). The Company received partial proceeds of $13,968 from Sun Ying as of March 31, 2023, but this payment ~~has~~was ~~been~~ refunded induring the ~~current~~ quarter ended September 30, 2023. On January 30, 2024, Sun Ying and the Company entered into an agreement that cancelled the Shares Increase Contract. Sun Ying agreed to surrender the shares to the ~~Registrant~~Company for cancellation.

NOTE 11. CONTINGENCIES

Loss contingencies considered to be remote by management are generally not disclosed unless they involve guarantees, in which case the guarantee would be disclosed.

The Company was not subject to any material loss contingencies as of ~~September~~December 3031, 2023 and through the date of this report.

NOTE 12. SUBSEQUENT EVENTS

On Qingdao Tianci Liangtian Agricultural Technology Development Co., Ltd. was established in Shandong, China, on December 29, 2023, and is wholly owned by Tianci Liangtian.

On January 30, 2024, Sun Ying and the Company entered into an agreement that cancelled the Shares Increase Contract. Sun Ying agreed to surrender the shares to the Registrant for cancellation.

Management has evaluated subsequent events through the date which the consolidated financial statements were available to be issued. All subsequent events requiring recognition as of ~~September~~December 3031, 2023 have been incorporated into these consolidated financial statements and there are no other subsequent events that require disclosure in accordance with FASB ASC Topic 855, “Subsequent Events.”

F-18

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of our financial condition and results of operations are based upon our condensed consolidated financial statements and the notes thereto included elsewhere in this Quarterly Report on Form 10-Q, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of such financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, and expenses. On an ongoing basis, we evaluate these estimates, including those related to useful lives of real estate assets, bad debts, impairment, contingencies and litigation. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. There can be no assurance that actual results will not differ from those estimates.

Application of Critical Accounting Policies

The discussion and analysis of the Company’s financial condition and results of operations is based upon its condensed consolidated financial statements, which have been prepared in accordance with United States generally accepted accounting principles. The preparation of these financial statements requires us to make significant estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. These items are monitored and analyzed by management for changes in facts and circumstances, and material changes in these estimates could occur in the future. Changes in estimates are recorded in the period in which they become known. The Company bases its estimates on historical experience and various other assumptions that we believe to be reasonable under the circumstances. Actual results may differ from our estimates if past experience or other assumptions do not turn out to be substantially accurate.

In connection with the preparation of our financial statements for the ~~six~~nine months ended ~~September~~December 3031, 2023, there was one accounting estimate made which was (a) subject to a high degree of uncertainty and (b) material to our results. That was the determination to record the $705,396 in subscriptions receivable without a reserve. The Company made that determination based on its knowledge of the ~~subscribers~~subscriber’s financial condition.

Results of Operations

The following table shows key components of the unaudited results of operations during the three and ~~six~~nine months ended ~~September~~December 3031, 2023 and 2022:

	For the Three Months Ended September 30,						Change
	For the Three Months Ended December 31,						Change
	2023			2022			$			%
Revenue	$	~~817~~297,~~410~~435		$	3893,~~277~~531		$	~~779~~203,~~133~~904			~~2,036~~218	%
Cost of Sales		~~544~~213,~~487~~847			3183,~~490~~514			~~512~~130,~~997~~333			~~1,629~~156	%
Gross Profit		~~272~~83,~~923~~588			610,~~787~~017			~~266~~73,~~136~~571			~~3,921~~734	%
Total operating costs and expenses		94(32,~~597~~326	)		~~309~~9,~~487~~564			(~~214~~41,890	)		(69438	)%
Income (loss) from operations before other income and income taxes		~~178~~115,~~326~~914			~~(302,700~~453	)		~~481~~115,~~026~~461			~~(159~~25,488	)%
Other income		-			~~1,464~~(46	)		~~(1,464~~46	)		(100	)%
Income (loss) from operations before income taxes		178,326			(301,236	)		479,562			(159	)%
Income from operations before income taxes		115,914			407			115,507			28,380	%
Income taxes		-1,826			-			-1,826			N/A
Net income (loss) from continuing operations		178,326			(301,236	)		479,562			(159	)%
Net income from continuing operations		114,088			407			113,681			27,931	%
Income from discontinued operations, net of income taxes		-			~~68,359~~-			~~(68,359~~-	)		~~(100~~N/A	)%
Net income (loss)		178,326			(232,877	)		411,203			(177	)%
Net income		114,088			407			113,681			27,931	%
Less: (loss) from discontinued operations attributable to non-controlling interests		-			-			-			N/A
Net income (loss) attributable to common shareholders’	$	178,326		$	(232,877	)	$	411,203			(177	)%
Net income attributable to common shareholders’	$	114,088		$	407		$	113,681			27,931	%

	For the Six Months Ended September 30,					Change
	2023		2022			$			%
Revenue	$	991,179	$	77,261		$	913,918			1,183	%
Cost of Sales		666,688		62,762			603,926			962	%
Gross Profit		324,491		14,499			309,992			2,138	%
Total operating costs and expenses		299,838		535,356			(235,518	)		(44	)%
Income (loss) from operations before other income and income taxes		24,653		(520,857	)		545,510			(105	)%
Other income		17		2,481			(2,464	)		(99	)%
Income (loss) from operations before income taxes		24,670		(518,376	)		543,046			(105	)%
Income taxes		-		-			-			N/A
Net income (loss) from continuing operations		24,670		(518,376	)		543,046			(105	)%
Income from discontinued operations, net of income taxes		-		68,358			(68,358	)		(100	)%
Net income (loss)		24,670		(450,018	)		474,688			(105	)%
Less: (loss) from discontinued operations attributable to non-controlling interests		-		-			-			N/A
Net income (loss) attributable to common shareholders’	$	24,670	$	(450,018	)	$	474,688			(105	)%

All of our revenue during the three and six months ended September 30, 2023 and 2022 was generated by our subsidiary Yuxinqi. Yuxinqi is a marketing enterprise with a focus on milled rice and other agricultural products. Incorporated on February 5, 2018, Yuxinqi’s sales are erratic, since a stable customer base has not been established yet. 97% of the Company’s revenue during the six months ending September 30, 2023 were attributable to a single customer.

	For the Nine Months Ended December 31,					Change
	2023		2022			$			%
Revenue	$	1,288,614	$	170,792		$	1,117,822			654	%
Cost of Sales		880,535		146,276			734,259			502	%
Gross Profit		408,079		24,516			383,563			1,565	%

Total operating costs and expenses		267,512		544,920			(277,408	)		(51	)%
Income (loss) from operations before other income and income taxes		140,567		(520,404	)		660,971			(127	)%
Other income		17		2,435			(2,418	)		(99	)%
Income (loss) from operations before income taxes		140,584		(517,969	)		658,553			(127	)%
Income taxes		1,826		-			1,826			N/A
Net income (loss) from continuing operations		138,758		(517,969	)		656,727			(127	)%
Income from discontinued operations, net of income taxes		-		68,358			(68,358	)		(100	)%
Net income (loss)		138,758		(449,611	)		588,369			(131	)%
Less: (loss) from discontinued operations attributable to non-controlling interests		-		-			-			N/A
Net income (loss) attributable to common shareholders’	$	138,758	$	(449,611	)	$	588,369			(131	)%

~~For~~All of our revenue during the three and ~~six~~nine months ended ~~September~~December 3031, 2023 and 2022, ~~our revenue~~ was ~~attributable~~generated toby ~~the~~our ~~sales~~subsidiary ofYuxinqi. ~~milled~~Yuxinqi ~~rice~~is ~~and~~a ~~other~~marketing ~~foodstuffs.~~enterprise ~~Sales~~with bya ~~Yuxinqi~~focus ~~during~~on ~~the~~milled ~~three~~ rice and ~~six months~~other ~~ended~~agricultural ~~September~~products. ~~30,~~Incorporated ~~2023~~on ~~were~~February 25,~~036%~~ ~~and 1~~2018,~~183%~~ ~~more~~Yuxinqi’s ~~than~~sales ~~during~~are ~~the~~erratic, ~~three~~since ~~and~~a ~~six~~stable ~~months~~customer ~~ended~~base ~~September~~has not ~~30,~~been ~~2022,~~established ~~respectively~~yet. ~~The~~ ~~increase~~96% inof the Company’s revenue ~~occurred~~during ~~primarily~~the ~~because~~nine ofmonths ~~the~~ending ~~orders~~December ~~from~~31, ~~our~~2023 ~~customer~~were ~~Yuanzheng~~attributable ~~during~~to ~~the~~a ~~periods~~single customer.

~~The~~For ~~cost~~the ofthree ~~sales was $544,487~~ and ~~$31,490~~nine ~~for the three~~ months ended ~~September~~December 3031, 2023 and 2022, ~~$666,688~~our ~~and~~revenue ~~$62,762~~was ~~for~~attributable ~~the~~to ~~six months ended September 30, 2023, respectively. Operations during~~ the ~~three~~sales ~~months ended September 30, 2023 yielded gross profit~~ of ~~$272,923~~milled rice and ~~$6,787~~other ~~with gross margin of 33~~foodstuffs.4% ~~and~~Sales ~~17.7%,~~by ~~respectively. Operations~~Yuxinqi during the ~~six~~three and nine months ended ~~September~~December 3031, 2023 ~~yielded~~were ~~gross~~218% ~~profit of $324,491~~ and ~~$14,499 with gross margin of 32.7~~654% ~~and 18.8%,~~more ~~respectively.~~than ~~The increase in gross margin~~ during the three and ~~six~~nine months ended ~~September~~December 3031, ~~2023~~2022, ~~compared~~respectively. ~~to the same period~~The ofincrease ~~the~~in ~~previous~~revenue ~~year,~~occurred ~~was~~ primarily ~~attributable~~because ~~to our promotions~~ of ~~new products at discount prices during~~ the ~~previous~~orders ~~year~~from ~~and~~our ~~the recovery~~customer Yuanzheng during ~~2023~~those ~~by the “Jiufu” product series of the gross profit margin it realized in earlier~~ periods.

The ~~Company~~cost ~~incurred~~of ~~operating~~sales ~~expenses~~was ~~totaling~~$213,847 and $83,514 for the three months ended December 31, 2023 and 2022, $94880,~~597~~535 and $~~309~~146,~~487~~276 for the nine months ended December 31, 2023 and 2022, respectively. Operations during the three months ended ~~September~~December 3031, 2023 and 2022 yielded gross profit of $83,588 and $~~299~~10,~~838~~017 with gross margin of 28.1% and ~~$535~~10.7%,~~356~~ respectively. Operations during the ~~six~~nine months ended December 31, 2023 and 2022 yielded gross profit of $408,079 and $24,516 ~~September~~with gross margin of 31.7% and 14.4%, respectively. The ~~components~~increase in gross margin during the three and nine months ended December 31, 2023, compared to the same period of ~~operating~~the ~~expenses~~previous ~~(unaudited)~~year, was primarily attributable to our promotions of new products at discount prices during the previous year. During the nine months ended December 31, 2023, when 96% of our sales were: made to Yuanzheng, gross margin increased because we were able to negotiate sales of our “Jiufu” product series to Yuanzheng yielding the gross profit margin that product series had realized in earlier periods.

	Three Months Ended September 30				Six Months Ended September 30
	2023		2022		2023		2022
Salaries and benefits	$	40,195	$	46,223	$	80,309	$	92,541
Office expenses		15,220		77,392		30,348		104,069
Rentals and leases		7,029		4,624		7,373		9,366
Professional fees		8,639		25,112		29,139		42,835
Exchange loss		13,239		140,846		139,643		268,389
Advertising and promotion expenses		10,275		15,290		13,026		18,156
Total operating expenses	$	94,597	$	309,487	$	299,838	$	535,356

The Company reported negative operating expenses during the three months ended December 31, 2023 and very modest operating expenses during the three months ended December 31, 2022 because the Company includes “exchange gain (loss)” in its total operating expenses and realized an exchange gain in each of those quarters. Exchange gain (loss) represented the decrease or increase in the RMB value of Tianci’s debt to Organic Agricultural as a result of changes in the USD to CNY exchange rate. During the quarters ended December 31, 2023 and 2022, the USD weakened, which increased the value of Tianci’s obligation to Organic Agricultural. During the nine months periods ended December 31, 2023 and 2022, however, the value of the USD increased in comparison with the CNY, resulting in a reduction in the value of Tianci’s debt.

Salaries and benefits decreased in the three and six months ended September 30, 2023, due to a decrease in the total number of employees. Office expenses decreased in the three and six months ended September 30, 2023 primarily attributable to the decrease in management service expenses.

The Company’s operating expenses for the six months ended September 30, 2023 included $139,643 of an exchange loss. This represented the increase in the RMB value of Tianci’s debt to Organic Agricultural as a result of the increase in the USD to CNY exchange rate from 6.8680 to 7.2952 during that period. By comparison, the Company’s operating expenses during the six months ended September 30, 2022 included $268,389 of exchange loss. This represented the increase in the RMB value of Tianci’s debt to Organic Agricultural as a result of the increase in the USD to CNY exchange rate from 6.3431 to 7.1128.

The Company’s operations produced a net income of $178,326 and a net loss of $301,236 from continuing operations for the three months ended September 30, 2023 and 2022, and a net income of $24,670 and a net loss of $518,376 from continuing operations for the six months ended September 30, 2023 and 2022, respectively.

The Company produced a net income of $68,359 and $68,358 for the three and six months ended September 30, 2022 from the discontinued operations of Tianci Wanguan. On August 19, 2022, the Company completed the divestment of Tianci Wanguan.

Liquidity and Capital Resources

The Company’s operations have been financed primarily by proceeds from the sale of shares. During the six months ended September 30, 2023, the Company received partial proceeds of $132,699 from the sale of 10,000,000 shares for a price of $880,000 to two investors in November 2022. The two subscribers have agreed to pay the remaining proceeds of $705,396 on or before October 16, 2024. The debt is recorded as a subscription receivable in shareholders’ equity at September 30, 2023. Subsequent to September 30, 2023, one of the investors, Sun Ying, and the Company entered into an agreement that cancelled the Shares Increase Contract. Sun Ying agreed to surrender the shares to the Registrant for cancellation in exchange for cancellation of his commitment to pay 630,000 RMB (US$86,358) for the shares.

As of September 30, 2023, our working capital was $309,200, an increase of $285,974 during the six months ended September 30, 2023. The increase was primarily due to our use of the partial proceeds from the sale of 10 million shares to increase our inventory balance.

The largest components of working capital at September 30, 2023 were cash of $95,141, and inventories of $337,234, which were offset by $152,412 in customer deposits against future sales.

The Company’s operating expenses totaled ($32,326) and $9,564 during the three months ended December 31, 2023 and 2022, and $267,512 and $544,920 during the nine months ended September, respectively. The components of operating expenses (unaudited) were:

	Three Months Ended December 31						Nine Months Ended December 31
	2023			2022			2023		2022
Salaries and benefits	$	20,410		$	37,808		$	100,719	$	130,349
Office expenses		11,721			11,360			42,069		115,429
Rentals and leases		4,389			4,445			11,762		13,811
Professional fees		11,643			22,875			40,782		65,710
Exchange loss		(80,439	)		(76,195	)		59,204		192,194
Advertising and promotion expenses		(50	)		9,271			12,976		27,427
Total operating expenses	$	(32,326	)	$	9,564		$	267,512	$	544,920

Salaries and benefits decreased in the three and nine months ended December 31, 2023, due to a decrease in the total number of employees. Office expenses decreased in the three and nine months ended December 31, 2023 primarily attributable to the decrease in management service expenses.

The Company’s operations produced a net income of $114,088 and $407 from continuing operations for the three months ended December 31, 2023 and 2022, and a net income of $138,758 and a net loss of $517,969 from continuing operations for the nine months ended December 31, 2023 and 2022, respectively.

The Company produced a net income of $Nil and $68,358 for the three and nine months ended December 31, 2022 from the discontinued operations of Tianci Wanguan. On August 19, 2022, the Company completed the divestment of Tianci Wanguan.

Liquidity and Capital Resources

The Company’s operations have been financed primarily by proceeds from the sale of shares. During the nine months ended December 31, 2023, the Company received partial proceeds of $132,699 from the sale of 10,000,000 shares for a price of $880,000 to two investors in November 2022. As of December 31, 2023, the two subscribers have paid a total of $ 174,604 and agreed to pay the remaining proceeds of $705,396 on or before October 16, 2024. The debt is recorded as a subscription receivable in shareholders’ equity at December 31, 2023. Subsequent to December 31, 2023, one of the investors, Sun Ying, and the Company entered into an agreement that cancelled the Shares Increase Contract. Sun Ying agreed to surrender the shares to the Registrant for cancellation in exchange for cancellation of his commitment to pay 630,000 RMB (US$88,000) for the shares.

As of December 31, 2023, our working capital was $363,068, an increase of $339,842 during the nine months ended December 31, 2023. The increase was primarily due to our use of the partial proceeds from the sale of 10 million shares to fund business activity that increased our accounts receivable balance.

The largest components of working capital at December 31, 2023 were cash of $60,487, accounts receivable of $313,385 and inventories of $146,324, which were offset by $157,079 in customer deposits against future sales.

Cash Flows

The following unaudited table summarizes our cash flows for the ~~six~~nine months ended ~~September~~December 3031, 2023 and 2022.

	For the Six Months Ended September 30,						Change
	For the Nine Months Ended December 31,						Change
	2023			2022			$
Net cash (used in) operating activities	$	(84121,~~635~~170	)	$	(~~245~~308,~~772~~692	)	$	~~161~~187,~~137~~522
Net cash (used in) Investing activities		-			(288	)		288
Net cash provided by financing activities		132,699			-13,968			~~132~~118,~~699~~731
Effect of exchange rate fluctuation on cash and cash equivalents		(~~2,785~~904	)		(29,~~727~~485	)		2628,~~942~~581
Net increase (decrease) in cash and cash equivalents		4510,~~279~~625			(~~275~~324,~~787~~497	)		~~321~~335,~~066~~122
Cash and cash equivalents, beginning of period		49,862			408,463			(358,601	)
Cash and cash equivalents, end of period	$	9560,~~141~~487		$	~~132~~83,~~676~~966		$	(3723,~~535~~479	)

During the ~~six~~nine months ended ~~September~~December 3031, 2023, our operations used net cash of $84121,~~635~~170. Although the Company recorded net income of $24138,~~670~~758 during the ~~six~~nine ~~month~~months period, its operations resulted in a net cash loss primarily because itwe ~~used~~increased ~~$200,984~~accounts inreceivable ~~cash~~by to$296,490 ~~increase inventories~~ and ~~decrease~~decreased accounts payable and accrued expenses by $3145,~~855~~460. During the ~~six~~nine months ended ~~September~~December 3031, 2022, our operations used net cash of $~~245~~308,~~772~~692, primarily because itwe recorded a net loss of $~~450~~517,~~018~~969 from continuing operating.

During the ~~six~~nine months ended ~~September~~December 3031, 2022, our investing activities used net cash of $288. The Company completed the divestment of Tianci Wanguan in this period, and the cash was disbursed on divestment of Tianci Wanguan.

Our financing activities during the ~~six~~nine months ended ~~September~~December 3031, 2023 generated $132,699 from cash collected on account of the ~~subscriptions~~subscription receivable. The Company had no$13,968 ~~financing~~cash provided by financing activities and generated from cash collected on shares issued during the ~~six~~nine months ended ~~September~~December 3031, 2022.

Trends, Events and Uncertainties

There is substantial doubt about our ability to continue as a going concern as a result of our lack of significant revenues and recurring losses. If we are unable to generate significant revenue or secure additional financing, we may be required to cease or curtail our operations.

The Company is expanding its product offerings to include more products. In addition, our marketing personnel are developing new customers with the intention of building a stable base of customers. In this manner, the Company hopes to increase sales to support the future operations and development of the Company. There is no guarantee that the Company’s new strategy will be successful. As of ~~September~~December 3031, 2023, a stable customer base has not been established yet.

The U.S. government, including the SEC, has made statements and taken actions that have led to changes in relations between the U.S. and China, and will impact companies with connections to the United States or China. Those actions by the U.S. government included imposing several rounds of tariffs affecting certain products manufactured in China and imposing sanctions and restrictions in relation to China. Actions by the SEC included issuing statements indicating that it would make enhanced review of companies with significant China-based operations. It is unknown whether and to what extent new legislation, executive orders, tariffs, laws or regulations will be adopted, or the effect that any such actions would have on U.S.-domiciled companies with significant connections to China, our industry or on us. Any unfavorable government policies on cross-border relations, including increased scrutiny on companies with significant China-based operations, capital controls or tariffs, may affect our ability to raise capital and the market price of our shares. If any new legislation, executive orders, tariffs, laws and/or regulations are implemented, if existing trade agreements are renegotiated or if the U.S. or Chinese governments take retaliatory actions due to the recent U.S.-China tensions, such changes could have an adverse effect on our business, financial condition and results of operations, our ability to raise capital and the market price of our shares. Changes in United States and China relations and/or regulations may adversely impact our business, our operating results, our ability to raise capital and the market price of our shares.

Other than the factors listed above we do not know of any trends, events or uncertainties that have had or are reasonably expected to have a material impact on our net sales or revenues or income from continuing operations.

Recent Accounting Pronouncements

There were no recent accounting pronouncements that we expect to have a material effect on the Company’s financial position or results of operations. Please refer to Note 2 of our condensed consolidated financial statements included in this quarterly report.

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

Not applicable.

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Our management maintains disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are designed to provide reasonable assurance that the material information required to be disclosed by us in our periodic reports filed or submitted under the Exchange Act are 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 us in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

Under the supervision and with the participation of our management team, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) and 15d-15(e) promulgated under the Securities Exchange Act of 1934, as amended, as of ~~September~~December 3031, 2023. Based on this evaluation, we concluded that our disclosure controls and procedures have the following material weaknesses:

●

The relatively small number of employees who are responsible for accounting functions prevents us from segregating duties within our internal control system.

●

Our internal financial staff lack expertise in identifying and addressing complex accounting issue under U.S. Generally Accepted Accounting Principles.

●

Our Chief Financial Officer is not familiar with the accounting and reporting requirements of a U.S. public company.

●

We have not developed sufficient documentation concerning our existing financial processes, risk assessment and internal controls.

Based on their evaluation, our Chief Executive Officer and Chief Financial Officer concluded that the Company’s system of disclosure controls and procedures were not effective as of ~~September~~December 3031, 2023 for the purposes described in this paragraph.

Changes in Internal Control over Financial Reporting

No changes in the Company’s internal control over financial reporting came to management’s attention during the quarter ended ~~September~~December 3031, 2023 that have materially affected, or are likely to materially affect, the Company’s internal control over financial reporting.

PART II – OTHER INFORMATION

Item 1. Legal Proceedings.

We are currently not involved in any litigation that we believe could have a material adverse effect on our financial condition or results of operations. There is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the executive officers of our Company or any of our subsidiaries, threatened against or affecting our Company, our common stock, any of our subsidiaries or of our companies or our subsidiaries’ officers or directors in their capacities as such, in which an adverse decision could have a material adverse effect.

Item 1A. Risk Factors.

There have been no material changes from the risk factors included in the Company’s Annual Report on Form 10-K for the year ended March 31, 2023, as filed with the SEC on November 17, 2023.

Item 2. Unregistered Sale of Equity Securities and Use of Proceeds.

During the quarter ended ~~September~~December 3031, 2023, the Company did not complete any unregistered sales of equity securities.

The Company did not repurchase any of its equity securities that were registered under Section 12 of the Securities Act during the quarter ended ~~September~~December 3031, 2023.

Item 3. Defaults upon Senior Securities.

Not applicable

Item 4. Mine Safety Disclosure

Not applicable.

Item 5. Other Information.

~~None~~During the quarter ended December 31, 2023, no director or officer adopted or terminated any Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement, as each term is defined in Item 408(a) of Regulation S-K.

Item 6. Exhibits

INDEX TO EXHIBITS

Exhibit No.		Description of Exhibit
31.1		Certification of Chief Executive Officer pursuant to Securities Exchange Act Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2		Certification of Chief Financial Officer pursuant to Securities Exchange Act Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1		Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2		Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS		Inline XBRL Instance Document.
101.SCH		Inline XBRL Taxonomy Extension Schema Document.
101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

ORGANIC AGRICULTURAL COMPANY LIMITED

Signature	Title	Date
/s/ Wu Zhiwei	Chief Executive Officer	~~February~~March 84, 2024
Wu Zhiwei	(Principal Executive Officer)
/s/ Sun Xiuxia	Chief Financial Officer	~~February~~March 84, 2024
Sun Xiuxia	(Principal Financial and Accounting Officer)

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