Quarterly report pursuant to Section 13 or 15(d)

PROPERTY, PLANT AND EQUIPMENT

PROPERTY, PLANT AND EQUIPMENT

9 Months Ended

Sep. 30, 2014

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment Disclosure [Text Block]

NOTE 10 – PROPERTY, PLANT AND EQUIPMENT

At September 30, 2014 and December 31, 2013, property, plant and equipment consisted of the following:

		September 30,		December 31,
	Useful life	2014		2013
				(As Restated)
Fishing vessels	10 - 20 Years	$	65,510,000	$	61,840,994
Fishing vessels pursuant to capital lease – related party	25 Years		26,435,403		26,435,403
Vehicle	5 Years		136,940		139,196
Office and other equipment	3 – 5 Years		476,225		481,239
Fishing vessels under construction	-		35,564,258		16,272,875
			128,122,826		105,169,707
Less: accumulated depreciation			(7,166,787)		(3,199,000)
		$	120,956,039	$	101,970,707

For the three months ended September 30, 2014 and 2013, depreciation expense amounted to $753,519 and $549,927, respectively, of which $746,155 and $543,200, respectively, was included in cost of revenue, and the remainder was included in operating expense, respectively. For the nine months ended September 30, 2014 and 2013, depreciation expense amounted to $4,022,232 and $1,160,603, respectively, of which $4,000,510 and $1,140,703, respectively, was included in cost of revenue, and the remainder was included in operating expense, respectively.

Depreciation is not taken during the period of construction. Upon completion of the construction, fishing vessel under construction balances will be classified to fishing vessels.

As of September 30, 2014 and December 31, 2013, the Company had 31 and 38 fishing vessels with net carrying amount of approximately $32.5 million and $33.1 million, respectively, pledged as collateral for its bank loans and bank loans of a related party. The bank loans of the related party were in the amount of approximately $21.6 million and $20.7 million as of September 30, 2014 and December 31, 2013, respectively (see note 16).

As of September 30, 2014 and December 31, 2013, the Company pledged approximately $15.7 million and $16.2 million, respectively, of fishing vessels under construction as collateral for its bank loans (see note 12).