United States securities and exchange commission logo
September 22, 2022
Xiaoyuan Zhang
Chief Financial Officer
Senmiao Technology Ltd
16F, Shihao Square, Middle Jiannan Blvd.
High-Tech Zone, Chengdu
Sichuan, People s Republic of China
Re: Senmiao Technology
Ltd
Form 10-K
Filed July 15, 2022
File No. 001-38426
Dear Mr. Zhang:
We have limited our review of your filing to the financial
statements and related
disclosures and have the following comments. In some of our comments, we
may ask you to
provide us with information so we may better understand your disclosure.
Please respond to these comments within ten business days by
providing the requested
information or advise us as soon as possible when you will respond. If
you do not believe our
comments apply to your facts and circumstances, please tell us why in
your response.
After reviewing your
response to these comments, we may have additional comments.
Form 10-K Filed July 15, 2022
Item 1. Business, page 6
1. To the extent that
consolidated VIEs constitute a material part of the consolidated
financial statements
for periods covered in future filings, please provide in tabular form a
condensed consolidating
schedule that disaggregates the operations and depicts the
financial position,
cash flows, and results of operations as of the same dates and for the
same periods for which
audited consolidated financial statements are required. The
schedule should:
present major line
items, such as revenue and cost of goods/services, and subtotals
and disaggregated
intercompany amounts, such as separate line items for
intercompany
receivables and investment in subsidiary;
disaggregate the
parent company, the VIEs and its consolidated subsidiaries, the
WFOEs that are the
primary beneficiary of the VIEs, and an aggregation of other
Xiaoyuan Zhang
FirstName LastNameXiaoyuan Zhang
Senmiao Technology Ltd
Comapany 22,
September NameSenmiao
2022 Technology Ltd
September
Page 2 22, 2022 Page 2
FirstName LastName
entities that are consolidated; and
present any intercompany amounts on a gross basis and when
necessary, additional
disclosure about such amounts should be included in order to make
the information
presented not misleading.
The objective of this disclosure is to allow an investor to evaluate
the nature of assets held
by, and the operations of, entities apart from the VIE, as well as the
nature and amounts
associated with intercompany transactions. Please include the proposed
disclosure in your
response letter.
Our Corporate Structure, page 10
2. Based on the diagram of your Company s corporate structure on page
10 and page F-7,
Hunan Ruixi Financial Leasing Co., Ltd. ( Hunan Ruixi ), is
presented as your majority
owned subsidiary in China. However, we note that Hunan Ruixi is not
listed in EX.21.1 in
your list of subsidiaries. Please revise future filings to ensure that
the list of subsidiaries is
consistent with the diagram of your Company s corporate structure
and other parts of your
filing.
Regulations, page 16
3. In future filings please provide quantitative disclosure of the dollar
amount of specific
restrictions under PRC laws and regulations on your PRC subsidiaries
with respect to
transferring net assets to Senmiao either in the form of dividends,
loans, or advances.
Please include proposed disclosure in your response letter.
Recent greater oversight by the CAC over data security, page 58
4. You state on page 59 that "[a]s of the date of this Report, we, our
PRC subsidiaries and
equity investee company, (i) are not required to obtain permissions
from any PRC
government authorities on the operation of our PRC subsidiaries and
the issuance of our
stocks to foreign investors, (ii) are not required to obtain
permissions from the CSRC,
CAC or any other government authorities on our PRC subsidiaries
operations. . . . When
the Cybersecurity Review Measures become effective, and if the
Security Administration
Draft is enacted as proposed, we believe that the operations of our
PRC subsidiaries and
our listing will not be affected and that we will not be subject to
cybersecurity review by
the CAC." In future filings, state in this risk factor whether you
made
these determinations by relying on the advice of counsel. If so,
please disclose the name
of counsel. If not, describe the risks related to the process of your
determination. Please
include the proposed disclosure in your response letter.
PRC regulation of loans to and direct investment in PRC entities by offshore
holding companies,
page 60
5. In future filings, provide quantitative disclosure of any loans,
direct investment, and
Xiaoyuan Zhang
FirstName LastNameXiaoyuan Zhang
Senmiao Technology Ltd
Comapany 22,
September NameSenmiao
2022 Technology Ltd
September
Page 3 22, 2022 Page 3
FirstName LastName
capital contributions you have made to your PRC subsidiaries or former
VIEs, whether
from offering proceeds or otherwise. Please include proposed
disclosure in your response
letter.
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Net gain from deconsolidation of VIEs - discontinued operations, page 93
6. We note your disclosure on page 93 related to the purchase on March
23, 2022, of
Sichuan Senmiao s 94.5% equity interests for a total consideration
of zero. We further
note that you recognized a gain of $366,604 in the consolidated
statements of changes in
stockholders equity related to the non-controlling interest from
acquired equity interest.
We also note your reference to the detailed analysis related to this
transaction in Note 3 to
your consolidated financial statements. We are not able to locate the
analysis in Note 3.
Please address the following:
Tell us why the 94.5% equity interest in Sichuan Senmiao was
acquired for no
consideration;
Provide us the analysis you refer to in the aforementioned
disclosure related to this
transaction including any authoritative guidance that you
considered;
Tell us how you determined the value of the non-controlling
interest; and
Revise future filings to include a discussion of your accounting
for this transaction.
Consolidated statements of operations and comprehensive income (loss), page F-3
7. We note that you present basic and diluted earnings (loss) per share
separately for
continuing and discontinued operations. Please revise future filings
to also present
combined basic and diluted earnings (loss) per share amounts for each
period presented.
Please refer to ASC 260-10-45-2.
Note 3 (r) Revenue recognition
Online ride-hailing platform services, page F-20
8. We note your disclosure on page 20 related to the jointly promulgated
Interim Measures
for the Administration of Online Taxi Booking Business Operations and
Services which
appears to require the online ride-hailing services to meet the
requirements set out by the
Interim Measures and take full responsibility of the ride services. We
also note your
accounting policy disclosure on page F-20 as follows: The Company
evaluates the
presentation of revenue on a gross or net basis based on whether it
controls the service
provided to the Rider and is the principal (i.e., gross ), or it
arranges for other parties to
provide the service to the Rider and is an agent (i.e., net ).
Since the Company is not
primarily responsible for ride-hailing services provided to Riders, it
does not have
inventory risk related to the services. Thus, the Company recognizes
revenue at a net
basis. Please address the following:
Reconcile the regulatory disclosure requirement that indicates
online ride-hailing
services are fully responsible for ride services with your policy
disclosure that
Xiaoyuan Zhang
Senmiao Technology Ltd
September 22, 2022
Page 4
indicates you are not primarily responsible for ride-hailing
services.
Please provide us with a detailed analysis of how you
determined that your ride
hailing services in the PRC should be presented on a net basis
considering the
guidance in ASC 606-10-55-36 through 55-40.
Please also provide us with an English-language translation of
your terms of service
or customer service agreement related to your ride hailing
services in the PRC.
Note 4. Business Combination, page F-26
9. We note your disclosures on page F-26 and F-27 related to your
different capital
investments in XXTX. We also note the following disclosure on page
F-27, As of March
31, 2022, the Company acquired $ 8,065 in cash, net of cash paid to
XXTX in the
acquisition of XXTX. The remaining purchase consideration of
approximately $ 0.3
million from XXTX Investment Agreement signed on September 11, 2020
and
approximately $ 5.7 million additional capital investment from XXTX
Increase
Investment Agreement signed on February 5, 2021 mentioned above are
expected to be
paid by the Company by December 31, 2025. Please address the
following:
Reconcile above disclosure to your statement on page F-26 that you
have made
approximately $5.81 million in capital contributions to XXTX.
Please tell us and revise future filings to clearly quantify the
total purchase price, how
it was determined, the various amounts and type of consideration
paid for XXTX, the
amounts that have actually been paid as of March 31, 2022, and
the amounts still
owed as of that date.
10. Please tell how you determined you were not required to file XXTX
financial statements
considering the requirements of Article 8-04 of Regulation S-X.
In closing, we remind you that the company and its management are
responsible for the
accuracy and adequacy of their disclosures, notwithstanding any review,
comments, action or
absence of action by the staff.
You may contact Becky Chow at 202-551-6524 or William Schroeder at
202-551-3294 if
you have questions regarding comments on the financial statements and related
matters. Please
contact Dana Brown at 202-551-3859 or J. Nolan McWilliams at 202-551-3217 with
any other
questions.
FirstName LastNameXiaoyuan Zhang Sincerely,
Comapany NameSenmiao Technology Ltd
Division of
Corporation Finance
September 22, 2022 Page 4 Office of
Finance
FirstName LastName