The information set forth in this section contains certain "forward-looking
statements", including, among others (i) expected changes in our revenue and
profitability, (ii) prospective business opportunities and (iii) our strategy
for financing our business. Forward-looking statements are statements other than
historical information or statements of current condition. Some forward-looking
statements may be identified by use of terms such as "believes", "anticipates",
"intends" or "expects". These forward-looking statements relate to our plans,
liquidity, ability to complete financing and purchase capital expenditures,
growth of our business including entering into future agreements with companies,
and plans to successfully develop and obtain approval to market our product. We
have based these forward-looking statements largely on our current expectations
and projections about future events and financial trends that we believe may
affect our financial condition, results of operations, business strategy and
financial needs.

Although we believe that our expectations with respect to the forward-looking
statements are based upon reasonable assumptions within the bounds of our
knowledge of our business and operations, in light of the risks and
uncertainties inherent in all future projections, the inclusion of
forward-looking statements in this Annual Report should not be regarded as a
representation by us or any other person that our objectives or plans will be
achieved.

We assume no obligation to update these forward-looking statements to reflect
actual results or changes in factors or assumptions affecting forward-looking
statements.

Our revenues and results of operations could differ materially from those
projected in the forward-looking statements as a result of numerous factors,
including, but not limited to, the following: the risk of significant natural
disaster, the inability of the our company to insure against certain risks,
inflationary and deflationary conditions and cycles, currency exchange rates,
and changing government regulations domestically and internationally affecting
our products and businesses.

You should read the following discussion and analysis in conjunction with the
Financial Statements and Notes attached hereto, and the other financial data
appearing elsewhere in this Annual Report.

US Dollars are denoted herein by "USD", "$" and "dollars".



                                    Overview

We primarily engage in the manufacturing and distribution of organic fertilizer and the sales of agricultural products in the PRC. Our organic fertilizer products are sold under our brand names "Zongbao," "Fukang," and "Muliang."



Through our patented technology, we process crop straw (including corn, rice,
wheat, cotton, and other crops) into high quality organic nutritious fertilizers
that are easily absorbed by crops in three hours. Straws are common agricultural
by-products. In PRC, farmers usually remove the straw stubble that are remains
after grains, by burning them in order to continue farming on the same land.
These activities have resulted in significant air pollution, and they damage the
surface structure of the soil with loss of nutrients. We turn waste into
treasure by transforming the straws into organic fertilizer, which also
effectively reduces air pollution. The organic straw fertilizer we produce does
not contain the heavy metals, antibiotics and harmful bacteria that are common
in the traditional manure fertilizer. Our fertilizers also provide optimum
levels of primary plant nutrients, including multi-minerals, proteins and
carbohydrates that promote the healthiest soils capable of growing the healthy
crops and vegetables. It can effectively reduce the use of chemical fertilizers
and pesticides as well as reduce the penetration of large chemical fertilizers
and pesticides into the soil, thus avoiding water pollution. Therefore, our
fertilizer can effectively improve the fertility of soil, and the quality and
safety of agricultural products.

We generated our revenue mainly from our organic fertilizers, which accounted
for approximately 91.5% and 95.8% of our total revenue for the years ended
December 31, 2021 and 2020, respectively. We currently have two integrated
factories in Weihai City, Shandong Province, PRC to produce our organic
fertilizers, which have been in operations since August 2015. We plan to improve
the technology for our existing organic straw fertilizer production lines in the
following aspects: (i) adopt more advanced automatic control technology for raw
material feed to shorten the processing time of raw material, and (ii)
manufacture powdered organic fertilizer instead of granular organic fertilizer
production in order to avoid the drying and cooling process, as such will
increase our production capacity.


                                       72




With the focus of producing organic fertilizers, we also engage in the business
of selling agriculture food products including apples, and as a sales agent for
other large agriculture companies in the PRC. In 2014, we rented 350 mu (about
57.66 acres) of mountainous land as an apple orchard. The sales of apples
generated less than 1% of our total revenue for the years ended December 31,
2021 and 2020. We expect to generate more revenues from the sales of apples as
the apple orchards become more mature in the next few years.

In addition, we plan to engage in the processing and distribution of black goat
products, with business commencing in June 2022. We are currently constructing a
deep-processing slaughterhouse and processing plant which is expected to have
the capacity of slaughtering 200,000 black goats per year in Chuxiong City,
Yunnan Province, in China. Our black goat processing products including goat rib
lets, goat loin roast, goat loin chops, goat rack, goat leg, goat shoulder, goat
leg shanks, ground goat, goat stew meat, whole goat, half goat, lamb viscera,
etc. We expect to start generating revenue from the black goat products in 2022.

Viagoo Solutions


Viagoo logistic platform aims to provide a solution for shippers to easily
optimise the logistics resources by either listing their assets in the platform
for other shippers to book or request the logistic services via the platform.
The flexible sharing model ensures shippers and carriers to be able to get the
best deals so as to reduce the cost by maximizing utilization of the unused
resources.

Viagoo platform provides full online tracking, route optimization and capacity
planning options to help the carriers efficiently manage their operations. Using
Internet of Things (IOT), GPS, mobile integration, document and data integration
services, Viagoo platform is able to empower shippers and carriers with an up to
date digital platform to support their digital transformations. With a ready
Application Programming Interface (API) to various eCommerce platforms, shippers
and carriers are able to plan their digital strategies and grow their
businesses.

Viagoo platform is built on a secured cloud environment that has been tested and
approved by some key corporate users in healthcare as well as logistics sectors.
With advanced technology in plan, Viagoo is seeking investments to expand the
digital capability particularly in the area of Artificial Intelligence, machine
learning, blockchain in transaction handling, data analytics in resource
distribution and cold chain management. Also, using document automation and data
integration technologies, Viagoo platform will offer value added services such
as insurance on the go, vehicle lease financing, link up to rest stop, fuel,
vehicle workshop services.

The acquisition of Viagoo Pte Ltd, a Singapore based online logistic platform,
will enable the Muliang group of companies to optimize the transport logistics
to lower the cost of delivery and increase the efficiency. The platform will
connect truck drivers to Muliang and provide end to end tracking of delivery
status. With this platform, it is expected to reduce delivery costs by 30%.


Viagoo platform is expected to be opened to the China market where other
companies and merchants can book delivery services and transporters can sign on
to list and provide their services. Development work has begun in August 2020 to
provide localization and support for map and address services in China. The
development and testing are expected to be completed in June 2022 and ready

for
launch in July 2022.


Viagoo Business Model

Viagoo business model has 3 main revenue streams.

Viagoo Transport Marketplace (VTM) - This is the transaction platform for
shippers and carriers to list and accept delivery jobs. The platform provides
sharing functions where a group of shippers can share the transport fleet to
some common places (e.g. shopping malls in the city). This service will reduce
the waiting time and fuels and resulting in huge cost savings.

? VTM provides single job and bulk orders or API connection for job posting. The

fees are pre-calculated based on distance, areas, volume matric weight, type

of goods, delivery options and time.



  ? Task tracking - Shippers can track the delivery status if the option for
    tracking is required.




                                       73

? eWallet option - eWallet will be used for the service purpose and payment will

be deducted from the eWallet stored value.

? Reports - Delivery reports are available for shippers to track the performance

and status of the delivery operation.

VTM is charged to carriers based on certain percentage of the freight charges. Other add-on services like online insurance, rest stop services will be a percentage charged to the service providers.



Viagoo Enterprise Services (VES) - is a cloud base service that provides the
operation management to support the Transport and Logistics team. With the use
of the various modules, carrier's transport management is able to greatly
optimised the resources and achieve higher efficiency.

? Automatic Scheduling - Delivery / Invoice data will be pushed to the VES for

automatic schedule to the driver via VES mobile app. The criteria of automatic

scheduling are based on location, time preference, and route zoning. These


    criteria can be configured and fine-tuned as the business progresses.

? Route Optimisation - The system is able to automatically calculate the best

routes based on various delivery points and constraints such as "time window".

With the route optimisation, the transport planner is able to handle new

delivery addresses dynamically. Also if there is a change in delivery plans

due to various unforeseen circumstances such as vehicle breakdown, customer

last minute cancellation, the system is able to re-optimise quickly by pushing


    a button.

? VES Driver app - Task tracking - Once the tasks are started, they will be

tracked till the jobs are completed. If e-sign is accepted, customers can sign

and acknowledge the acceptance of goods using VES' mobile sign feature built

into the app or by taking a photo of the signed invoices or deliver orders


    (usually the last page of the document).



  ? Customer Notification - Customers will be notified via email upon the

completion of the delivery. A copy of the invoice / delivery order along with


    the signed copies will be sent to customers (customer email list to be
    maintained in the system) via email.

? Reports - Delivery reports are available for operations managers to track the


    performance and status of the delivery operations.

? VES Temperature Sensor Tracking Services - This is an additional module for

real-time tracking of temperature control (via a GPS temperature tracking

device installed in the truck) trucks for the purpose of preventing food waste


    and ensuring food safety.

VES is charged based on a monthly subscription by vehicles and by users. It is integrated with VTM and jobs received via VTM can be assigned and tracked automatically by VES.



Enterprise Systems - This is a project based system integration. The enterprise
system is charged based on project price and annual maintenance service fees. As
Viagoo smart logistics platform gains acceptance in local markets, we expect
business opportunities to arise for us to custom build enterprise solutions in
the healthcare as well as logistics sectors. For example, Parkway Pantai
Singapore is using us to custom build the online logistic job assignment and
tracking of lab sample collection / delivery between clinics / hospitals and
lab. This is to facilitate efficient deployment of the delivery resources and to
ensure compliance is achieved in a tightly controlled fashion.

On January 11, 2021, Viagoo Pte Ltd entered into a joint venture to form a new
legal entity Runnerzzz Pte Ltd together with a well-established incumbent
logistics company, Big Foot Logistics Pte Ltd. Big Foot holds 51% of equity
stakes while Viagoo Pte Ltd holds 49% equity stakes of Runnerzzz Pte Ltd. We
believe that the strategic joint venture will pave way for Viagoo to create more
business opportunities in the logistics space, leveraging on the stronghold

of
Big Foot Logistics Pte Ltd.


                                       74




                               Recent Development

Impact of COVID-19


Started in December 2019, the outbreak of COVID-19 caused by a novel strain of
the coronavirus has become widespread in China and in the rest of the world,
including in each of the areas in which the Company, its suppliers and its
customers operate. In order to avoid the risk of the virus spreading, the
Chinese government enacted various restrictive measures, including suspending
business operations and quarantines, starting from the end of January 2020. We
followed the requirements of local health authorities to suspend operation and
production and have employees work remotely in February and March 2020. Since
April 2020, we gradually resumed production and are now operating at full
capacity.

As a result of the COVID-19 outbreak in December 2019 and continuing in the
first quarter of 2020, the Company's businesses, results of operations,
financial position and cash flows were adversely affected in 2020 with potential
continuing impacts on subsequent periods, including but not limited to the
material adverse impact on the Company's revenues as result of the suspension of
operations and decline in demand by the Company's customers.

We are monitoring the global outbreak and spread of the novel strain of
coronavirus (COVID-19) and taking steps in an effort to identify and mitigate
the adverse impacts on, and risks to, our business (including but not limited to
our employees, customers, other business partners, our manufacturing
capabilities and capacity and our distribution channels) posed by its spread and
the governmental and community reactions thereto. We continue to assess and
update our business continuity plans in the context of this pandemic, including
taking steps in an effort to help keep our workforces healthy and safe. The
spread of COVID-19 has caused us to modify our business practices (including
employee travel, employee work locations in certain cases, and cancellation of
physical participation in certain meetings, events and conferences), and we
expect to take further actions as may be required or recommended by government
authorities or as we determine are in the best interests of our employees,
customers and other business partners. We are also working with our suppliers to
understand the existing and future negative impacts to our supply chain and take
actions in an effort to mitigate such impacts. Due to the speed with which the
COVID-19 situation is developing, the global breadth of its spread and the range
of governmental and community reactions thereto, there is uncertainty around its
duration and ultimate impact; therefore, any negative impact on our overall
financial and operating results (including without limitation our liquidity)
cannot be reasonably estimated at this time, but the pandemic could lead to
extended disruption of economic activity and the impact on our financial and
operating results could be material.

Disposal of land use right and production facility for repayment of debt



The Company completed its sale of industrial land and production facility in
Shanghai through an administratively organized private sale on June 16, 2021.
Through the sale, the Company's subsidiary Shanghai Zongbao is able to satisfy
its debt obligations due to Agricultural Bank of China and Shanghai Zhongta
Construction and Engineering Co., Ltd. and improve its cash position. As a
result of the sale, Agricultural Bank of China received RMB 35,632,193.36,
Shanghai Zhongta Construction and Engineering Co., Ltd. received RMB 26,000,000
and Shanghai Zongbao received the remaining RMB 7,921,902.28.

                          Critical Accounting Policies

Our discussion and analysis of our financial condition and results of operations
are based on our consolidated financial statements, which have been prepared in
accordance with U.S. generally accepted accounting principles. The preparation
of these financial statements requires us to make estimates and judgments that
affect the reported amounts of assets, liabilities, revenues and expenses. We
evaluate, on an on-going basis, our estimates for reasonableness as changes
occur in our business environment. We base our estimates on experience, the use
of independent third-party specialists and 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. Actual results may differ from
these estimates under different assumptions or conditions.

Critical accounting policies are defined as those that are reflective of significant judgments, estimates and uncertainties, and potentially result in materially different results under different assumptions and conditions. We believe the following are our critical accounting policies:




                                       75




Basis of Presentation

The accompanying consolidated financial statements have been prepared in
conformity with US GAAP. The basis of accounting differs from that used in the
statutory accounts of the Company, which are prepared in accordance with the
accounting principles of the PRC ("PRC GAAP"). The differences between US GAAP
and PRC GAAP have been adjusted in these consolidated financial statements. The
Company's functional currency is the Chinese Renminbi ("RMB") and Singapore
dollar("SGD"); however, the accompanying consolidated financial statements have
been translated and presented in United States Dollars ("USD").

Liquidity and Going Concern


As reflected in the accompanying consolidated financial statements, we had net
accumulated deficit of $6,876,227 and $8,596,332 as of December 31, 2021 and
December 31, 2020, respectively. Our cash balances as of December 31, 2020 and
December 31, 2020 were $38,013 and $348,834, respectively. We had current
liability of $13,770,110 at December 31, 2021 which would be due within the next
12 months. In addition, we had a working capital of $5,403,720 and working
capital of $5,145,436 at December 31, 2021 and 2020, respectively.


According to the normal operation, the company does not have problems with
business sustainability. But the new covid-19 pandemic from the beginning of
2020 greatly impacts the company's operation. In 2020 and 2021, the company's
sales had declined, and the recovery of accounts receivable was slow. As a
result, the Company has taken the following measures :(1) while actively opening
up new markets and new customers, the Company have increased the collection of
accounts receivable and strive to control the turnover days of accounts
receivable to be within 90 days at the end of 2021;(2) As of the period end, the
company has completed the disposal of Shanghai industrial land transfer
transaction and paid off all loans.

Because the company is gradually recovering the accounts receivables affected by
the Covid-19, and the sales are gradually returning to the normal level, the
company's current cash revenue and expenditure are normal, which did not affect
the normal operation. Now, after Covid-19, the company has no problems with
business sustainability. IPO financing will be used for new investments to
expand the operating scale and does not affect the existing operating scale.

Principles of Consolidation



The consolidated financial statements include the financial statements of the
Company, its subsidiaries and consolidated VIE, including the VIE' subsidiaries,
for which the Muliang Viagoo is the primary beneficiary.

All transactions and balances among the Company, its subsidiaries, the VIE and the VIE' subsidiaries have been eliminated upon consolidation.



As PRC laws and regulations welcome to invest in organic fertilizer industry
businesses, the Muliang Viagoo operates its fertilizer business in the PRC
through Muliang Industry and its subsidiaries, which are collectively referred
as the "WFOEs".

By entering into a series of agreements (the "VIE Agreements"), the Muliang
Viagoo, through WFOEs, obtained control over Muliang Industry and its
subsidiaries (collectively referred as "VIE"). The VIE Agreements enable the
Muliang Viagoo to (1) have power to direct the activities that most
significantly affect the economic performance of the VIE, and (2) receive the
economic benefits of the VIE that could be significant to the VIE. Accordingly,
the Muliang Viagoo is considered the primary beneficiary of the VIE and has
consolidated the VIE' financial results of operations, assets and liabilities in
the Muliang Viagoo's consolidated financial statements. In making the conclusion
that the Muliang Viagoo is the primary beneficiary of the VIE, the Muliang
Viagoo's rights under the Power of Attorney also provide the Muliang Viagoo's
abilities to direct the activities that most significantly impact the VIE'
economic performance. The Muliang Viagoo also believes that this ability to
exercise control ensures that the VIE will continue to execute and renew the
Master Exclusive Service Agreement and pay service fees to Muliang Viagoo. By
charging service fees to be determined and adjusted at the sole discretion of
Muliang Viagoo, and by ensuring that the Master Exclusive Service Agreement is
executed and remains effective, Muliang Viagoo has the rights to receive
substantially all of the economic benefits from the VIE.


                                       76

Details of the VIE Agreements, are set forth below:



                                           As of             As of
                                       December 31,      December 31,
                                           2021              2020
Current assets                         $  18,972,383     $  25,878,427
Non-current assets                         8,995,363         8,863,429
Total Assets                              27,967,746        34,741,856
Current liabilities                       12,794,076        20,475,295
Non-current liabilities                      422,480         1,425,475
Total liabilities                         13,216,556        21,900,770

Total shareholders' equity (deficit) $ 14,751,190 $ 12,841,086





                                                            For the year ended
                                                               December 31,
                                                           2021             2020
Net income                                             $  2,254,902     $  1,198,517

Net cash provided by (used in) operating activities 5,484,916 1,413,581 Net cash provided by (used in) investment activities (1,158,773 )

(75,346 ) Net cash provided by (used in) financing activities $ (4,328,560 ) $ (1,648,247 )

VIE Agreements that were entered to give the Muliang Viagoo effective control over the VIE include:

Voting Rights Proxy Agreement and Irrevocable Power of Attorney



Under which each shareholder of the VIE grant to any person designated by WFOEs
to act as its attorney-in-fact to exercise all shareholder rights under PRC law
and the relevant articles of association, including but not limited to,
appointing directors, supervisors and officers of the VIE as well as the right
to sell, transfer, pledge and dispose all or a portion of the equity interest
held by such shareholders of the VIE. The proxy and power of attorney agreements
will remain effective as long as WFOEs exist. The shareholders of the VIE do not
have the right to terminate the proxy agreements or revoke the appointment of
the attorney-in-fact without written consent of the WFOEs.

Exclusive Option Agreement



Under which each shareholder of the VIE granted 9F or any third party designated
by 9F the exclusive and irrevocable right to purchase from such shareholders of
the VIE, to the extent permitted by PRC law and regulations, all or part of
their respective equity interests in the VIE for a purchase price equal to the
registered capital. The shareholders of the VIE will then return the purchase
price to 9F or any third party designated by 9F after the option is exercised.
9F may transfer all or part of its option to a third party at its own option.
The VIE and its shareholders agree that without prior written consent of 9F,
they may not transfer or otherwise dispose the equity interests or declare any
dividends. The restated option agreement will remain effective until 9F or any
third party designated by 9F acquires all equity interest of the VIE.

Spousal Consent



The spouse of each shareholder of the VIE has entered into a spousal consent
letter to acknowledge that he or she consents to the disposition of the equity
interests held by his or her spouse in the VIE in accordance with the exclusive
option agreement, the power of attorney and the equity pledge agreement
regarding VIE structure described above, and any other supplemental
agreement(s) may be consented by his or her spouse from time to time. Each such
spouse further agrees that he or she will not take any action or raise any claim
to interfere with the arrangements contemplated under the mentioned agreements.
In addition, each such spouse further acknowledges that any right or interest in
the equity interests held by his or her spouse in the VIE do not constitute
property jointly owned with his or her spouse and each such spouse
unconditionally and irrevocably waives any right or interest in such equity

interests.


                                       77




Loan Agreement

Pursuant to the loan agreements between WFOEs and each shareholder of the VIE,
WFOEs extended loans to the shareholders of the VIE, who had contributed the
loan principal to the VIE as registered capital. The shareholders of VIE may
repay the loans only by transferring their respective equity interests in VIE to
9F Inc. or its designated person(s) pursuant to the exclusive option agreements.
These loan agreements will remain effective until the date of full performance
by the parties of their respective obligations thereunder.

VIE Agreements that enables Muliang Viagoo to receive substantially all of the economic benefits from the VIE include:

Equity Interest Pledge Agreement



Pursuant to equity interest pledge agreement, each shareholder of the VIE has
pledged all of his or her equity interest held in the VIE to WFOEs to secure the
performance by VIE and their shareholders of their respective obligations under
the contractual arrangements, including the payments due to WFOEs for services
provided. In the event that the VIE breach any obligations under these
agreements, WFOEs as the pledgees, will be entitled to request immediate
disposal of the pledged equity interests and have priority to be compensated by
the proceeds from the disposal of the pledged equity interests. The shareholders
of the VIE shall not transfer their equity interests or create or permit to be
created any pledges without the prior written consent of WFOEs. The equity
interest pledge agreement will remain valid until the master exclusive service
agreement and the relevant exclusive option agreements and proxy and power of
attorney agreements, expire or terminate.

Master Exclusive Service Agreement


Pursuant to exclusive service agreement, WFOEs have the exclusive right to
provide the VIE with technical support, consulting services and other services.
WFOEs shall exclusively own any intellectual property arising from the
performance of the agreement. During the term of this agreement, the VIE may not
accept any services covered by this agreement provided by any third party. The
VIE agree to pay service fees to be determined and adjusted at the sole
discretion of the WFOEs. The agreement will remain effective unless WFOEs
terminate the agreement in writing.

Risks in relation to the VIE structure

Muliang Viagoo believes that the contractual arrangements with the VIE and their
current shareholders are in compliance with PRC laws and regulations and are
legally enforceable. However, uncertainties in the PRC legal system could limit
the Muliang Viagoo's ability to enforce the contractual arrangements. If the
legal structure and contractual arrangements were found to be in violation of
PRC laws and regulations, the PRC government could:

? Revoke the business and operating licenses of the Muliang Viagoo's PRC

subsidiaries or consolidated affiliated entities;

? Discontinue or restrict the operations of any related-party transactions among

the Muliang Viagoo's PRC subsidiaries or consolidated affiliated entities;

? Impose fines or other requirements on the Muliang Viagoo's PRC subsidiaries or

consolidated affiliated entities;

? Require the Muliang Viagoo's PRC subsidiaries or consolidated affiliated

entities to revise the relevant ownership structure or restructure operations;


   and/or;

? Restrict or prohibit the Muliang Viagoo's use of the proceeds of the additional

public offering to finance the Muliang Viagoo's business and operations in

China;

? Shut down the Muliang Viagoo's servers or blocking the Muliang Viagoo's online


   platform;

? Discontinue or place restrictions or onerous conditions on the Muliang Viagoo's


   operations; and/or

? Require the Muliang Viagoo to undergo a costly and disruptive restructuring.






                                       78




Muliang Viagoo's ability to conduct its business may be negatively affected if
the PRC government were to carry out any of the aforementioned actions. As a
result, Muliang Viagoo may not be able to consolidate the VIE in its
consolidated financial statements as it may lose the ability to exert effective
control over the VIE and its shareholders, and it may lose the ability to
receive economic benefits from the VIE. Muliang Viagoo currently does not
believe that any penalties imposed or actions taken by the PRC government would
result in the liquidation of the Company, WFOEs, or the VIE.

The following table sets forth the assets, liabilities, results of operations
and cash flows of the VIE and their subsidiaries, which are included in Muliang
Viagoo's consolidated financial statements after the elimination of intercompany
balances and transactions:

Under the VIE Arrangements, Muliang Viagoo has the power to direct activities of
the VIE and can have assets transferred out of the VIE. Therefore, Muliang
Viagoo considers that there is no asset in the VIE that can be used only to
settle obligations of the VIE, except for assets that correspond to the amount
of the registered capital and PRC statutory reserves, if any. As the VIE are
incorporated as limited liability companies under the Company Law of the PRC,
creditors of the VIE do not have recourse to the general credit of Muliang
Viagoo for any of the liabilities of the VIE.

Currently there is no contractual arrangement which requires Muliang Viagoo to
provide additional financial support to the VIE. However, as Muliang Viagoo
conducts its businesses primarily based on the licenses held by the VIE, Muliang
Viagoo has provided and will continue to provide financial support to the VIE.

Revenue-producing assets held by the VIE include certain internet content
provision ("ICP") licenses and other licenses, domain names and trademarks. The
ICP licenses and other licenses are required under relevant PRC laws, rules and
regulations for the operation of internet businesses in the PRC, and therefore
are integral to Muliang Viagoo's operations. The ICP licenses require that core
PRC trademark registrations and domain names are held by the VIE that provide
the relevant services.

Muliang Viagoo consolidates the following entities, including wholly-owned
subsidiaries, Muliang HK, Shanghai Mufeng, Viagoo, and its wholly controlled
variable interest entities, Muliang Industry, and Zhongbao, 60% controlled
Agritech Development, 99% controlled Fukang, 65% controlled Zhonglian, 80%
controlled Yunnan Muliang and 51% controlled Heilongjiang. Accordingly, the 40%
equity interest holder of Agritech Development, 1% equity interest holders in
Fukang, 35% equity interest holders in Zhonglian, 20% interest in Yunnan
Muliang, and 49% equity interest in Heilongjiang are accounted as
non-controlling interest in the Company's consolidated financial statements.

Use of Estimates


In preparing financial statements in conformity with U.S. GAAP, management makes
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosures of contingent assets and liabilities at the dates of
the financial statements, as well as the reported amounts of revenues and
expenses during the reporting period. Significant estimates, required by
management, include the recoverability of long-lived assets and the valuation of
inventories. Actual results could differ from those estimates.

Accounts Receivable



We state accounts receivable at cost, net of allowance for doubtful accounts.
Based on our past experience and current practice in the PRC, management
provides for an 100% allowance for doubtful accounts equivalent to those
accounts that are not collected within one year, and 50% for receivables
outstanding for longer than six months. It is management's belief that the
current bad debt allowance adequately reflects an appropriate estimate based on
management's judgment.

Inventory Valuation

We value our fertilizer inventories at the lower of cost, determined on a
weighted average basis, and net realizable value (the estimated market price).
Substantially all inventory expenses, packaging and supplies are valued by

the
weighted average method.


                                       79




Revenue Recognition

On January 1, 2018, the Company adopted ASC 606 using the modified retrospective
method. Results for the reporting period beginning after January 1, 2018 are
presented under ASC 606, while prior period amounts have not been adjusted and
continue to be reported in accordance with the Company's historic accounting
under Topic 605.

Management has determined that the adoption of ASC 606 did not impact the Company's previously reported financial statements in any prior period nor did it result in a cumulative effect adjustment to opening retained earnings.



Revenue for sale of products is derived from contracts with customers, which
primarily include the sale of fertilizer products and environmental protection
equipment. The Company's sales arrangements do not contain variable
consideration. The Company recognizes revenue at a point in time based on
management's evaluation of when performance obligations under the terms of a
contract with the customer are satisfied and control of the products has been
transferred to the customer. For vast majority of the Company's product sales,
the performance obligations and control of the products transfer to the customer
when products are delivered, and customer acceptance is made.

Revenue for logistics-related service is derived from Viagoo subsidiaries.
Through an online service platform, the company provides the operation
management service to support customers. For VTM service, revenue is charged to
carriers based on certain percentage of the freight charges. For VES service,
revenue is recognized based on monthly subscription by vehicles and by users.
For system integration service, revenue is recognized over time based on the
progress of project and annual maintenance service.

Pursuant to the guidance of ASC Topic 840, rent shall be reported as income by
lessors over the lease term as it becomes receivable. The Company leased part of
the building of the Shanghai new plant to third parties as a warehouse. The
Company recognizes building leasing revenue over the beneficial period described
by the agreement, as the revenue is realized or realizable and earned.

Income Taxes



The Company accounts for income taxes under the provision of FASB ASC 740-10,
which requires the recognition of deferred tax assets and liabilities for the
expected future tax consequences of events that have been included in the
financial statements or tax returns. 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.
Valuation allowances are established, when necessary, to reduce deferred tax
assets to the amount expected to be realized.

                            New Accounting Standards

In February 2016, the FASB issued Accounting Standards Update No. 2016-02 (ASU
2016-02) "Leases (Topic 842)". ASU 2016-02 requires a lessee to recognize in the
statement of financial position a liability to make lease payments (the lease
liability) and a right-of-use asset representing its right to use the underlying
asset for the lease term. ASU 2016-02 is effective for interim and annual
reporting periods beginning after December 15, 2018. Early adoption is
permitted. For finance leases, a lessee is required to do the following:

? Recognize a right-of-use asset and a lease liability, initially measured at

the present value of the lease payments, in the statement of financial

position

? Recognize interest on the lease liability separately from amortization of the

right-of-use asset in the statement of comprehensive income

? Classify repayments of the principal portion of the lease liability within

financing activities and payments of interest on the lease liability and

variable lease payments within operating activities in the statement of cash


    flows.




                                       80

For operating leases, a lessee is required to do the following:

? Recognize a right-of-use asset and a lease liability, initially measured at

the present value of the lease payments, in the statement of financial

position

? Recognize a single lease cost, calculated so that the cost of the lease is

allocated over the lease term on a generally straight-line basis

? Classify all cash payments within operating activities in the statement of


    cash flows.



In July 2018, the FASB issued Accounting Standards Update No. 2018-11 (ASU
2018-11), which amends ASC 842 so that entities may elect not to recast their
comparative periods in transition (the "Comparatives Under 840 Option"). ASU
2018-11 allows entities to change their date of initial application to the
beginning of the period of adoption. In doing so, entities would:

? Apply ASC 840 in the comparative periods.

? Provide the disclosures required by ASC 840 for all periods that continue to

be presented in accordance with ASC 840.

? Recognize the effects of applying ASC 842 as a cumulative-effect adjustment to

retained earnings for the period of adoption.





In addition, the FASB also issued a series of amendments to ASU 2016-02 that
address the transition methods available and clarify the guidance for lessor
costs and other aspects of the new lease standard.

The management has reviewed the accounting pronouncements and adopted the new standard on January 1, 2019 using the modified retrospective method of adoption.


In August 2018, the FASB issued ASU 2018-13, "Fair Value Measurement (Topic
820), - Disclosure Framework - Changes to the Disclosure Requirements for Fair
Value Measurement," which makes a number of changes meant to add, modify or
remove certain disclosure requirements associated with the movement amongst or
hierarchy associated with Level 1, Level 2 and Level 3 fair value measurements.
The amendments in this Update modify the disclosure requirements on fair value
measurements based on the concepts in FASB Concepts Statement, Conceptual
Framework for Financial Reporting-Chapter 8: Notes to Financial Statements,
including the consideration of costs and benefits. The amendments on changes in
unrealized gains and losses, the range and weighted average of significant
unobservable inputs used to develop Level 3 fair value measurements, and the
narrative description of measurement uncertainty should be applied prospectively
for only the most recent interim or annual period presented in the initial
fiscal year of adoption. All other amendments should be applied retrospectively
to all periods presented upon their effective date. The amendments are effective
for all entities for fiscal years beginning after December 15, 2019, and interim
periods within those fiscal years, with early adoption permitted. The Company is
currently evaluating the potential impacts of ASU 2018-13 on its consolidated
financial statements.

In December 2019, the FASB issued ASU 2019-12 - Income Taxes (Topic 740):
Simplifying the Accounting for Income Taxes. This ASU provides an exception to
the general methodology for calculating income taxes in an interim period when a
year-to-date loss exceeds the anticipated loss for the year. This update also
(1) requires an entity to recognize a franchise tax (or similar tax) that is
partially based on income as an income-based tax and account for any incremental
amount incurred as a non-income-based tax, (2) requires an entity to evaluate
when a step-up in the tax basis of goodwill should be considered part of the
business combination in which goodwill was originally recognized for accounting
purposes and when it should be considered a separate transaction, and (3)
requires that an entity reflect the effect of an enacted change in tax laws or
rates in the annual effective tax rate computation in the interim period that
includes the enactment date. The standard is effective for the Company for
fiscal years beginning after December 15, 2020, with early adoption permitted.
The Company is currently in the process of evaluating the impact of the adoption
on its consolidated financial statements.

The Company believes that there were no other accounting standards recently issued that had or are expected to have a material impact on our financial position or results of operations.




                                       81




                             Results of Operations

We are principally engaged in the organic fertilizer manufacture and distribution business in the PRC, which account for 91.5% of our total revenue for the year ended December 31, 2021.


As a result of the COVID-19 outbreak in December 2019 and continuing in the year
of 2020, the Company's businesses, results of operations, financial position and
cash flows were adversely affected in 2020. However, the COVID-19 was under
control for the year ended December 31, 2021 in China. And we are growing our
revenue and net income steadily currently and expect to keep growing for the
coming years.

Operating Results for the Years Ended December 31, 2021 and 2020



                                              Year Ended December 31,
                                               2021             2020         Fluctuation
                                                $                $                $               %
Revenues-fertilizer                           9,730,962       10,548,324         (817,362 )        -7.7 %
Revenues-logistic                               904,320          378,853          525,467         138.7 %

Revenues-agricultural products                      120           81,355   

      (81,235 )       -99.9 %
Subtotal of revenue                          10,635,402       11,008,532         (373,130 )        -3.4 %
Cost-fertilizer                               5,910,703        5,994,087          (83,384 )        -1.4 %
Cost- logistic                                  477,978          133,905          344,073         257.0 %

Cost- agricultural products                          90          120,765   

     (120,675 )       -99.9 %
Subtotal of cost                              6,388,771        6,248,757          140,014           2.2 %
Gross profit                                  4,246,631        4,759,775         (513,144 )       -10.8 %
Gross margin                                      39.93 %          43.24 %
Operating expenses:

General and administrative expenses           2,033,234        2,677,054   

     (643,820 )       -24.0 %
Selling expenses                                467,859          464,942            2,917           0.6 %
Total operating expenses                      2,501,093        3,141,996         (640,903 )       -20.4 %
Income(loss) from operations                  1,745,538        1,617,779          127,759           7.9 %
Other income (expense):
Interest expense                               (151,720 )       (700,030 )        548,310         -78.3 %
Rent net income                                       -            6,276           (6,276 )      -100.0 %
Other income (expense), net                     352,340         (339,097 )        691,437        -203.9 %
Total other income (expense)                    200,620       (1,032,851 )      1,233,471        -119.4 %
Income before income taxes                    1,946,158          584,928        1,361,230         232.7 %
Income taxes                                    214,981         (394,979 )        609,960        -154.4 %
Net income (loss)                             1,731,177          979,907          751,270          76.7 %




Revenue.

Revenue for fertilizer decreased from $10,548,324 for the year ended December
31, 2020 to $9,730,962 for the year ended December 31, 2021, which represented a
decrease of $817,362, or approximately 7.7%. The decrease in revenue was mainly
due to the economic depression resulting from continuous impact of COVID-19.
However, there has been a general recovery in the economy after the height of
the pandemic. We expect to see a trend of improving sales as the epidemic moves
further into the past.

Revenue for logistic increased from $378,853 for the year ended December 31, 2020 to $904,320 for the year ended December 31, 2021, which represented an increase of $525,467, or 138.7%.




                                       82




Cost of sales

Cost of sales for fertilizer decreased from $5,994,087 for the year ended December 31, 2020 to $5,910,703 for the year ended December 31, 2021, which represented a decrease of approximately $83,384, or 1.4%. The decrease in cost of revenue was in line with the decrease in revenue.



Cost of sales for fertilizer increased from $133,905 for the year ended December
31, 2020 to $477,978 for the year ended December 31, 2021, which represented an
increase of $344,073, or 257.0%.

Gross profit



The gross profit for fertilizer decreased from $4,554,237 for the year ended
December 31, 2020 to gross profit of $3,820,259 for the year ended December 31,
2021. The gross margin decreased from 43.2% for the year ended December 31, 2020
to 39.3% for the year ended December 31, 2021. The decreased gross margin was
due to the increase in material cost..

The gross profit for logistic increased from $244,948 for the year ended
December 31, 2020 to gross profit of $426,342 for the year ended December 31,
2021. The gross margin decreased from 64.7% for the year ended December 31, 2020
to 47.1% for the year ended December 31, 2021.

Expenses.




We incurred $467,859 in selling expenses for the year ended December 31, 2021,
compared to $464,942 for the year ended December 31, 2020. We incurred
$2,033,234 in general and administrative expenses for the year ended December
31, 2021, compared to $2,677,054 for the year ended December 31, 2020. Total
selling, general and administrative expenses decreased by $643,820, or 24.0% for
the year ended December 31, 2021 as compared to the same period in 2020. Our
selling expenses increased by $2,917 and our general and administrative expenses
decreased by $848,189. The decrease in general and administrative expenses was
due to the improved management for the year ended December 31, 2021. We expect
our general and administrative expense to increase for the next year, if we
successfully complete our public offering.



Interest expense




We incurred $151,720 in interest expense during the year ended December 31,
2021, compared with interest expense of $700,030 for the year ended December 31,
2020. The decreased interest expense reflects the decreased loan balance as

of
December 31, 2021.


Net Income.


Our net income was $1,731,177 for the year ended December 31, 2021, compared
with net income of $979,907 for the year ended December 31, 2020, representing
an increase of $751,270, or 76.7%. The significant increase in net income was
mainly due to the significant decrease in General and administrative expenses,
the significant decrease in interest expense, and gain from disposal of Land use
right and Plant for the year ended December 31, 2021.


                        Liquidity and Capital Resources


Liquidity is the ability of a company to generate funds to support its current
and future operations, satisfy its obligations and otherwise operate on an
ongoing basis. At December 31, 2021 and December 31, 2020 our working capital
was $5,403,720 and $5,145,436, respectively. The improvement in our working
capital deficit was reflecting faster decrease in our current liability,
especially the significant decrease in current portion of long-term debt
balance.

We have financed our operations over the years ended December 31, 2021 and 2020 primarily through proceeds from stock issuance and advances from related parties, and net cash inflow from operations.




                                       83

The components of cash flows are discussed below:



                                                           For the Years Ended
                                                              December 31,
                                                          2021             2020
Net cash provided by (used in) operating activities   $  4,930,236     $  1,807,790
Net cash provided by (used in) investing activities     (1,158,773 )        (75,346 )
Net cash (used in) provided by financing activities     (4,363,568 )     (1,368,247 )
Exchange rate effect on cash                               281,284         (119,231 )
Net cash inflow (outflow)                             $   (310,821 )   $    244,966

Cash provided by Operating Activities


Net cash provided by operating activities was $4,930,236 for the year ended
December 31, 2021. Cash provided by operating activities for the year ended
December 31, 2021 consisted primarily of net income of $1,731,177 which was
adjusted by depreciation and amortization of $513,563. The Company had a
decrease of $1,978,747 in account receivable, a decrease of $10,758,708 in other
receivable, which was offset by an increase of $6,292,144 in prepayment and a
decrease of $2,393,158 in accounts payable and accrued payables.


Net cash provided by operating activities was $1,807,790 for the year ended
December 31, 2020. Cash provided by operating activities for the year ended
December 31, 2020 consisted primarily of net income of $979,907, which was
adjusted by depreciation and amortization of $965,296, and deferred income tax
assets of $429,232. The Company had an increase of $3,974,562 in account
payables, an increase of $870,166 in other payable, which were offset by an
increase of $6,121,606 in accounts receivable, and an increase of $125,255 in
inventory.

Cash used in Investing Activities

Net cash used in investing activities was $1,158,773 for the year ended December 31, 2021. The investment activity was payments made for construction in progress.

Net cash used in investing activities was $75,346 for the year ended December 31, 2020. The investment activity was payments made for construction in progress.

Cash used in Financing Activities

Net cash used in financing activities was $4,363,568 for the year ended December 31, 2021. During the year, cash provided by financing activities included repayment of short-term loans of $4,666,185, which were partly offset by proceeds from related parties of $302,617.




Net cash used in financing activities was $1,368,247 for the year ended December
31, 2020. During the period, cash used in financing activities consisted of
repayment of $845,807 to related party, short term loan repayment of $802,440,
and proceeds from issuing common stock of $280,000.

We anticipate that our current cash reserves plus cash from our operating
activities will not be sufficient to meet our ongoing obligations and fund our
operations for the next twelve months. As a result, we will need to seek
additional funding in the near future. We are looking to obtain additional
funding through equity financing in the secondary market, and/or renewing our
current obligations with loaners. We may also seek to obtain short-term loans
from our directors or unrelated parties. Additional funding may not be
available, or at acceptable terms, to us at this time. If we are unable to
obtain additional financing, we may be required to reduce the scope of our
business development activities, which could harm our business plans, financial
condition and operating results.


                                       84




        Contractual Commitments and Commitments for Capital Expenditure

Contractual Commitments



The following table summarizes our contractual obligations as of December 31,
2021 and the effect those obligations are expected to have on our liquidity and
cash flow in future periods.

                                                   Payments Due by Period as of December 31, 2021
                                                        Less than         1 - 3          3 - 5            Over
                                      Total               1 Year          Years          Years          5 Years
Contractual obligations
Loans                             $    1,458,616       $  1,174,756     $ 283,860     $         -     $          -
Others                                         -                  -             -               -                -
                                  $    1,458,616       $  1,174,756     $ 283,860     $         -     $          -

Commitments for Capital Expenditure

There is no commitment for capital expenditure as of December 31, 2021.

Off-Balance Sheet Items



We do not have any off-balance sheet arrangements that we are required to
disclose pursuant to these regulations. In the ordinary course of business, we
enter into operating lease commitments, purchase commitments and other
contractual obligations. These transactions are recognized in our financial
statements in accordance with generally accepted accounting principles in the
United States.

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