UNITED STATES


SECURITIES AND EXCHANGE COMMISSION


Washington, D.C. 20549





FORM 10-Q





x QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934





For the quarterly period ended March 31, 2011





oTRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT


For the transition period from _____________________ to ______________





Commission file number 333-151200





FLURIDA GROUP, INC.


((Exact name of registrant as specified in its charter)





Nevada

3469

26-0688130(State or other jurisdiction of

incorporation or organization)

(Primary Standard

Industrial Classification

Code Number)

IRS I.D.





22 West Washington St, Suit 1500

Chicago, IL

60602(Address of principal executive offices)

(Zip Code)





Issuer’s telephone number:  630-778-6991





N/A





(Former name, former address and former three months, if changed since last report)





Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 x  No  ̈





Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.





Large accelerated filer

 ̈

Accelerated filer

 ̈Non-accelerated filer

 ̈

Smaller Reporting Company

x





Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).





Yes o No x





As of April 1, 2011 there were 38,990,827 shares issued and outstanding of the registrant’s common stock.












TABLE OF CONTENTS





PART I — FINANCIAL INFORMATION
3Item 2.
Management’s Discussion and Analysis or Plan of Operation.
4Item 3.
Quantitative and Qualitative Disclosure about Market Risk
10Item 4.
Controls and Procedures.
11PART II — OTHER INFORMATION
11Item 1.
Legal Proceedings.
11Item 2.
Unregistered Sales of Equity Securities and Use of Proceeds.
11Item 3.
Defaults Upon Senior Securities
11Item 4.
(Removed and Reserved).
12Item 5.
Other Information.
12Item 6.
Exhibits.
12




2




PART I — FINANCIAL INFORMATION


FLURIDA GROUP, INC.
 
 Financial Statements
 (Unaudited)
 
 As of March 31, 2011 and 2010
  3
 
 Table of Contents
 
 Consolidated Balance Sheets
2Consolidated Statement of Operation
3Consolidated Shareholders Equity
4Consolidated Statement of Cash Flows
5Notes to Unaudited Consolidated Financial Statements
6
  1
 
 FLURIDA GROUP, INC.
 CONSOLIDATED BALANCE SHEETS
 
 March 31


December 312011


2010(Unaudited)ASSETSCurrent assets:Cash and cash equivalents

$
684,078


$
992,825Accounts receivable, net


2,039,639



2,282,640Inventory


1,400,857



1,533,220Total Current Assets

$
4,124,574


$
4,808,685Property, plant and equipment, net

$
64,026


$
46,138Other assets:Loan to supplier

$
284,626


$
284,626Accrued interest receivable


26,087



22,305Security deposit


6,264



6,264Total Other Assets

$
316,977


$
313,195TOTAL ASSETS

$
4,505,577


$
5,168,018LIABILITIES & EQUITYCurrent liabilities:Account payable

$
2,892,249


$
3,632,648Income taxes payable


88,350



79,307Unearned revenue


2,364



2,364Total current liabilities

$
2,982,963


$
3,714,319Stockholders' Equity:Common stock, $0.001 par value; 200,000,000 shares authorized; 38,990,827 shares issued and outstanding.

$
38,991


$
38,991Paid-in capital


1,221,613



1,221,613Retained earnings


246,430



187,572Accumulated other comprehensive Income


15,580



5,523Total stockholders' equity

$
1,522,614


$
1,453,699TOTAL LIABILITIES & EQUITY

$
4,505,577


$
5,168,018
  2
 
 FLURIDA GROUP, INC.
 CONSOLIDATED STATEMENT OF OPERATION
 
 Three Months EndedMarch 31, 2011


March 31, 2010Unaudited


UnauditedRevenues:

$
3,019,787


$
2,186,665Cost of Goods Sold

$
2,677,747


$
1,938,730Gross Profit

$
342,040


$
247,935Operating expenses:Research and development


-



-Selling, general and administrative expenses


230,109



198,057Depreciation and amortization expenses


3,584



-Total Operating Expenses

$
233,693


$
198,057Operating Income

$
114,813


$
49,878Investment income, net

$
3,861


$
3,691Interest expense, net


-



-Income before taxes

$
112,208


$
53,569Income tax expense


53,350



-Net income

$
58,858


$
53,569Net Income per common share-Basics

$
0.00


$
0.00Net Income per common share-Diluted

$
0.00


$
0.00Other comprehensive Income(Loss), net of tax:Foreign currency translation adjustments


10,057



(15,829
)Total other comprehensive Income(Loss)

$
10,057


$
(15,829
)Comprehensive Income (Loss)

$
68,915


$
37,740
  3
 
 FLURIDA GROUP, INC.
 CONSOLIDATED STATEMENT OF STOCKHOLDERS EQUITY
 FOR THE PERIOD ENDED MARCH 31, 2011
 (Unaudited)
 
 Additional





Accumulated Other


TotalCommon Stock


Paid-in


Retained


Comprehensive


Stockholders'Shares


Amount


Capital


Earnings


Income (Loss)


EquityBalance, December 31, 2009


38,990,827


$
38,991


$
1,221,613


$
(23,633
)

$
48,979


$
1,285,950Adjustment for Exchange rate changes

















$
(43,456
)

$
(43,456
)Net Income for the year ended December 31, 2010













$
211,205






$
211,205Balance, December 31, 2010


38,990,827


$
38,991


$
1,221,613


$
187,572


$
5,523


$
1,453,699Adjustment for Exchange rate changes

















$
10,057


$
10,057Net Income for the period ended March 31, 2011













$
58,858






$
58,858Balance, March 31, 2011


38,990,827


$
38,991


$
1,221,613


$
246,430


$
15,580


$
1,522,614
  4
 
 FLURIDA GROUP, INC.
 CONSOLIDATED STATEMENT OF CASH FLOWS
 
 Three Months EndedMarch 31, 2011


March 31, 2010Unaudited


UnauditedOperating Activities:Net Income

$
58,858


$
53,569Adjustments to reconcile net income to net cash provided by operating activities:Depreciation expense


3,584



-Inventory


132,363



(121,263
)Account receivables


243,000



(703,028
)Accrued interest receivable


(3,782
)


(3,691
)Unearned revenue


-



60,000Increase in income tax payable


9,043



-Increase in account payable


(740,398
)


348,143Decrease in credit card payable


-



(656
)Net cash provided by operating activities

$
(297,332
)

$
(366,926
)Investing Activities:Purchase Property


(21,472
)


-Net cash provided by investing activities

$
(21,472
)

$
-Financing Activities:Proceeds from issuance of common stock


-



-Proceeds from loan from shareholders


-



-Net cash provided by financing activities

$
-


$
-Effect of  Exchange Rate on Cash

$
10,057


$
(15,829
)Net increase (decrease) in cash and cash equivalents

$
(308,747
)

$
(382,755
)Cash and cash equivalents at beginning of the period

$
992,825


$
700,959Cash and cash equivalents at end of the period

$
684,078


$
318,204
  5
 
 FLURIDA GROUP, INC. AND SUBSIDIARIES
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
 NOTE A- BUSINESS DESCRIPTION
 
 Flurida Group, Inc. (the “Company”), incorporated under the laws of Nevada on December 19, 2006, with registered address at 502 East John Street, Carson City, NV 89706.  Flurida Group, Inc. operates its business in USA as Flurida Group USA, Inc., the Company’s wholly owned branch located in the State of Illinois and has principle office at 22 West Washington ST, Suite 1500, Chicago, IL 60602.
 Flurida Group leased a warehouse at 24412 S Main Street, Carson, CA 90745.
 
 Besides USA operation, Flurida Group, Inc. also established one subsidiary in Europe:
 Flurida Group European S.R.L (“Flurida European”): Flurida Group European S.R.L. was established on December 28, 2007 and is 100% owned by Flurida Group, Inc.  Flurida European is in the business of trading services, distribution, and marketing of the appliance parts in Europe.  The Flurida European is located at Via locatelli 2, 21010 Vizzola, Ticino, VA-Italy.
 
 The company closed its Flurida Qingdao China office in July, 2009.
 
 The Company’s main business includes sourcing, distribution and marketing of appliance parts in Asia, Europe, North and South America.
 
 These parts are manufactured in China by Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd. (“Zhong Nan Fu Rui”).  It was established in 2005 specializing in home appliance components and subassemblies manufacturing, and located in Qingdao City, Shandong Province, China.  On September 18, 2007, Flurida Group, Inc. signed a long-term distribution agreement with Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd.  Zhong Nan Fu Rui is a Chinese manufacturing company owned 100% by Mr. Jianfeng Ding, the founder of the Company.
 
 NOTE B – SIGNIFICANT ACCOUNTING POLICIES
 
 Use of Estimates
 
 The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America requires management to make estimates and assumptions that affect certain amounts reported in the financial statements and disclosures.  Accordingly, actual results could differ from those estimates.
  6
 
 FLURIDA GROUP, INC. AND SUBSIDIARIES
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
 NOTE B – SIGNIFICANT ACCOUNTING POLICIES (Continue)
 
 Principles of Consolidation
 
 The consolidated financial statements of the Company include the accounts of Flurida Group USA and Flurida Group European S.R.L.  All significant intercompany balances and transactions have been eliminated in consolidation.
 
 Basis of accounting
 
 The financial statements reflect the assets, revenues and expenditures of the Company on the accrued basis of accounting.
 
 Cash and Cash Equivalents
 
 The Company considers all highly-liquid investments with an original maturity of three months or less when purchased to be cash equivalents.
 
 Concentration of credit risk
 
 The Company maintains its cash in bank accounts which, at times, may exceed the federally insured limits.  The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on cash.
 
 Foreign Currency Translation
 
 The Company has determined the United States dollars to be its functional currency for Flurida Group USA and European Euro to be its functional currency in European business.  Assets and liabilities were translated to U.S. dollars at the period-end exchange rate.  Statement of operations amounts were translated to U.S. dollars using the first date of each month during the year.  Gains and losses resulting from translating foreign currency financial statements are accumulated in other comprehensive income (loss), a separate component of shareholders’ equity.
 
 Security Deposit
 
 The Company started having an office in CA State from September 2010, which is located at 24412 S Main ST, STE 105, Carson CA 90745.  Flurida Group USA Inc made $ 6,264 security deposit for leasing the property.
  7
 
 FLURIDA GROUP, INC. AND SUBSIDIARIES
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
 NOTE B – SIGNIFICANT ACCOUNTING POLICIES
 
 Property, Plant, and Equipment Depreciation
 
 Property, plant, and equipment are stated at cost.  Depreciation is being provided principally by straight line methods over the estimated useful lives of the assets. Expenditures for maintenance and repairs, which do not improve or extend the expected useful lives of the assets, are expensed to operations while major repairs are capitalized.
 
 The equipments were recorded as fixed asset to depreciate over 7 years and the electronic data processing equipments and furniture were recorded as fixed asset to depreciate over 5 years with straight line method.
 
 As of March 31, 2011, the company has furniture, Computer and data processing equipments, and equipments at a cost of $ 69,000, and $ 4,974 of accumulated depreciation expense was recorded.
 
 Account Receivable
 
 As of March 31, 2011, the company had a total of $ 2,039,639 account receivables from it major customers. Detail showed as below.
 
 3/31/2011Chuzhou FuDa

$
3,322Electrolux- Australia

$
135,467Electrolux-Anderson-US

$
819,154Electrolux-Mexico

$
272,938Electrolux-North Carolina-US

$
19,023Electrolux - Sweden

$
9,942Electrolux Italy

$
164,466Electrolux Hungary

$
171,009Exact Replacement Parts

$
11,200General Electric Company

$
142,800Master Precidion Global LLC(MPG)

$
121,867Qingdao Fubida

$
487ZhongNanFuRui

$
167,964TOTAL

$
2,039,639
  8
  
 FLURIDA GROUP, INC. AND SUBSIDIARIES
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
 NOTE B - SIGNIFICANT ACCOUNTING POLICIES (Continued)
 
 Accrued Interest Receivable
 
 In July 1st, 2009, the company loan $278,090 to its main supplier Zhong Nan Fu Rui Mechanical electronics Co., Ltd at interest rate of 5.31%, term July 1, 2009 to June 30, 2011.  On August 10, 2010, additional loan of $6,535.59 was advanced to Zhong Nan Fu Rui Mechanical electronics Co., Ltd.  As of March 31, 2011, total of $ 26,087 accrued interest receivable with interest rate at 5.31% was incurred.
 
 Account Payable
 
 The Company incurred accounts payable including professional fees, purchases, payroll and payroll tax liability, and other service fee payables. As of March 31, 2011, the company had a total of $ 2,892,249 account payable, which was included $ 2,245,092 for Zhong Nan Fu Rui, $ 265,722 for Chu Zhou Fu Da, $ 280,369 for Qiongdao Fu Bi Da, $ 39,891 for Shang Hai Fu Lu International Trading, and $ 14,964 for US suppliers, $ 33573 for salary and payroll tax payable, and $ 12,637 for all other account payable.
 
 Basics and Diluted Net Loss Per Common Share
  Basic earnings per share is computed by dividing income available to common shareholders (the numerator) by the weighted-average number of common shares outstanding (the denominator) for the period. Diluted earnings per share assume that any dilutive convertible securities outstanding were converted, with related preferred stock dividend requirements and outstanding common shares adjusted accordingly. It also assumes that outstanding common shares were increased by shares issuable upon exercise of those stock options for which market price exceeds the exercise price, less shares which could have been purchased by us with the related proceeds. In periods of losses, diluted loss per share is computed on the same basis as basic loss per share as the inclusion of any other potential shares outstanding would be anti-dilutive.
 
 The Company only issued one type of shares, i.e., common shares only.  There are no other types securities were issued.  Accordingly, the diluted and basics net loss per common share are the same.
  9
 
 FLURIDA GROUP, INC. AND SUBSIDIARIES
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
 NOTE B - SIGNIFICANT ACCOUNTING POLICIES (Continued)
 
 Inventory
 
 The inventory was valued at cost of purchase from suppliers.
 
 On June, 2008, Flurida Group, Inc signed a consigned inventory agreement with Electrolux Home Products De Mexico, S.A. DEC.V. (Electrolux).  Under the term of the agreement, the supplier, Flurida Group, Inc, agreed to produce, to maintain the transit the customized products per Electrolux’s specification. Electrolux maintain a storage location within Electrolux’s Juarez site for consigned inventory. And Flurida Group, Inc is facilitated to use of Electrolux’s storage location at such site to the sale of products to Electrolux; Electrolux will provide labor resources for receipt, stock up, and pulls of consigned products. Flurida Group, Inc., retains title and ownership of products while in transit to Electrolux’s site and while stored in the consigned inventory location. Title and ownership will pass to Electrolux when they withdraw products from the consigned inventory location. Upon withdrawal, Electrolux will pay for it under the payment term stated in the purchasing order correspond with the withdraw products. Products residing in the consigned inventory for 90 days with no activity due to non communicated demand change will no longer qualify for consignment, and will be considered as withdrawn product after 90 days. Accordingly, title passage and invoicing shall occur on such product per the term.
 
 As of March 31, 2011, there were 13,237 icemakers and 15120 motors in Electrolux Juarez warehouse as of consignment inventory. Also, there were 128,952 motors in Electrolux Anderson warehouse as of consignment inventory.
 
 The company also had 17,136 Icemakers and 15,120 motor at total cost of $ 242,399 that had been shipped out at FOB shipping point Qingdao, China to Electrolux Juarez warehouse. The company also had 250,560 Motors at total cost of $ 634,435 that had been shipped out at FOB shipping point Qingdao, China to Electrolux Anderson warehouse. Those purchases haven’t considered as a sale or a consignment inventory at the period ended March 31, 2011. Therefore, it’s the inventory of Flurida Group, Inc.
 
 As a result, the company had total of $ 1,400,857 inventory as of March 31 2011.
  10
 
 FLURIDA GROUP, INC. AND SUBSIDIARIES
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
 NOTE B - SIGNIFICANT ACCOUNTING POLICIES (Continued)
 
 Revenues Recognition
 
 Revenues include sales of appliance parts in Asia, Europe, and North America.
 
 Revenues are recognized from product sales upon shipment, which is the point in time when risk of loss is transferred to the customer, net of estimated returns and allowances.
 
 During the first quarter of 2011, the Company had total net revenue of $ 3,019,787.
 
 For the period January 1 to March 31, 2011, the Company sold total quantity of 36,483 icemakers and 606,960 motors to, Electrolux USA, located at Charlotte NCfor sales of $ 2,181,012. The motors were manufactured and supplied by Zhong Nan Fu Rui; all the motors were shipped out at FOB shipping point Qingdao, China.  And the icemakers were manufactured and supplied by ChuZhou FuDa Mechanical & Electronics Co., Ltd; all the icemakers were shipped out at FOB shipping point Nanjing, China.
 
 The Company sold motors to another US company, Master Precision Global (MPG), a sub-assembler to Electrolux, for $121,867. The motors were manufactured and supplied by Zhong Nan Fu Rui, and shipped out at FOB shipping point at Qingdao, China.
 
 The Company sold 480 icemakers, 500 components, and tooling service to Electrolux –Australia for $ 135,447. The icemakers were manufactured and supplied by Chu Zhou Fu Da Mechanical & Electronics; all the icemakers were shipped out at FOB shipping point Nanjing, China.
 
 The Company also sold DAC Boxes to Electrolux –Sweden for $ 5,990. The DAC Box were manufactured and supplied by Qingdao Fu Bi Da; all the DAC Boxes were shipped out at FOB shipping point Qingdao, China.
 
 The Company sold 24,156 DAC Boxes, 11,693 Deflector, 2,000 push buttons, 22,284 Magnets, 3,000 Motors and other related parts to Electrolux –Italy for total $ 152,804. The DAC Boxes, Magnets, Motors and other related parts were manufactured and supplied by Zhong Nan Fu Rui, and Qingdao Fu Bi Da; all the DAC Boxes magnets, and motors were shipped out at FOB shipping point Qingdao, China.
  11
 
 FLURIDA GROUP, INC. AND SUBSIDIARIES
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
 NOTE B - SIGNIFICANT ACCOUNTING POLICIES (Continued)
 
 Revenues Recognition (Continued)
 
 The Company also sold 15,408 DAC Boxes, 14,976 Magnets, 22,400 Motors, and other related parts to Electrolux – Hungry for total $ 143,876. The DAC Boxes, magnets and Motors were manufactured and supplied by Zhong Nan Fu Rui, and Qingdao Fu Bi Da respectively; all the DAC Boxes magnet, and motors were shipped out at FOB shipping point Qingdao, China.
 
 The company sold 18,144 Motors, 944 icemakers, and some related refrigerator appliance parts to North Carolina Electrolux Major Appliances, Inc for $ 65,959. The parts were manufactured and supplied by Zhong Nan Fu Rui, and were shipped out at FOB shipping point at Qingdao, China.
 
 In the first quarter of 2011, the Company sold thermostats and other related key parts for icemakers and motors, to Zhong Nan Fu Rui. The parts were exclusively used for the icemakers and motors purchase order by Electrolux.  Flurida Group purchased the parts from Wako Electronics, Inc., an US Company located at Louisville, KY 40299.  Flurida Group also sold Rocker Switch, the key parts for icemakers, to Zhong Nan Fu Rui.  The parts, Rocker Switch, were exclusively used for the icemakers purchase order by Electrolux.  The Company purchased the parts, Rocker Switch, from CW Industries, an US Company located at Southampton, PA; and also Flurida Group purchased some other related key parts from corporate America, and then sold to Zhong Nan Fu Rui, Qingdao Fubida Electronics Co., Ltd and ChuZhou FuDa Electronics Co., Ltd. Flurida Group, Inc. addsaveraged 5% - 10% margin based on the cost of purchase, then sold to them, so, $ 46,281 were sold and invoiced to Zhong Nan Fu Rui.
 
 The company sold thermostats to an US company, Exact Peplacement Parts for $ 22,400. The parts were manufactured and supplied by Zhong Nan Fu Rui, and were shipped out at FOB shipping point at Qingdao, China.
 
 From January 1 to March 31, 2011, the company sold $ 142,800 tooling service to General Electric Company, a US company located at Louisville, KY; and had other service income of $ 1,350.
 
 In summary, as of March 31, 2011, the Company incurred the total sales of $ 3,019,787. The cost of goods sold is discussed in details in Note C, Related Party Transactions.
  12
 
 FLURIDA GROUP, INC. AND SUBSIDIARIES
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
 NOTE B - SIGNIFICANT ACCOUNTING POLICIES (Continued)
 
 Operating Expense
 
 Operating Expenses includes all selling, general and administrative expenses for the Company. For the period ended March 31, 2011, the company had a total of $ 230,109 selling and administrative expenses. Detail was showed on Exhibit A.
 
 Payroll Expense
 
 Started from January 2011, Flurida Group had salaries for officers Jianfeng Ding, Yaru Huang, and Ying Zhong for $350,000, $80,000, $ 80,000. The Social Security tax and Medicare tax were paid by both employer and employees in USA; employees also withheld portion of Federal and State tax calculate by each individual’s status. All of the tax was submitted to Internal Revenue Service and local government at a semiweekly basis.
 
 Three Months EndedMarch 31, 2011


March 31, 2010Payroll Expense - ERFederal Unemployment Tax


-



-State Unemployment Tax


1,057.85



1,646.34US Medicare Tax - ER


1,960.52



1,442.46US Social Security Tax -ER


8,382.93



6,167.76Payroll Expense - ER - Other


-



-Total Payroll Expense - ER


11,401.30



9,256.56Payroll Expenses - EEFederal Tax Withholding


22,737.94



14,858.40State Tax Withholding


8,518.71



3,284.40US Medicare Tax -EE


1,960.52



1,442.46US Net Salaries payment - EE


96,248.64



73,726.98US Social Security Tax - EE


5,678.75



6,167.76Total Payroll Expenses - EE


135,144.56



99,480.00Total Payroll Expenses


146,545.86



108,736.56
 
 Comprehensive Income
 
 The company’s comprehensive income is comprised of net income, unrealized gains and losses on marketable securities classified foreign currency translation adjustments, and unrealized gains and losses on derivative financial instruments related to foreign currency hedging.
  13
 
 FLURIDA GROUP, INC. AND SUBSIDIARIES
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
 NOTE B - SIGNIFICANT ACCOUNTING POLICIES (Continued)
 
 Recent Accounting Pronouncements
 
 Business Combinations —The new guidance on business combinations retains the underlying concepts of the previously issued standard in that the acquirer of a business is required to account for the business combination at fair value. As with previous guidance, the assets and liabilities of the acquired business are recorded at their fair values at the date of acquisition. The excess of the purchase price over the estimated fair values are recorded as goodwill. The new pronouncement results in some changes to the method of applying the acquisition method of accounting for business combinations in a number of significant aspects. Under the new guidance, all acquisition costs are expensed as incurred and in-process research and development costs are recorded at fair value as an indefinite-lived intangible asset. Prior to the adoption, in-process research and development costs were immediately expensed and acquisition costs were capitalized. Further, the new guidance generally requires restructuring charges associated with a business combination to be expensed subsequent to the acquisition date.
 
 Fair Value Measurements and Disclosures — The pronouncements define fair value, establish guidelines for measuring fair value, and expand disclosures regarding fair value measurements.
 
 Derivative Instruments and Hedging Activities — The pronouncement requires additional disclosures about the objectives of derivative instruments and hedging activities, the method of accounting for such instruments, and a tabular disclosure of the effects of such instruments and related hedged items on Financial Statements. The pronouncement does not change the accounting treatment for derivative instruments.
 
 Variable Interest Entities and Transfers of Financial Assets and Extinguishments of Liabilities — The pronouncement on transfers of financial assets and extinguishments of liabilities removes the concept of a qualifying special-purpose entity and removes the exception from applying variable interest entity accounting to qualifying special-purpose entities. The new guidance on variable interest entities requires an entity to perform an ongoing analysis to determine whether the entity’s variable interest or interests give it a controlling financial interest in a variable interest entity. The pronouncements are effective for fiscal years beginning after November 15, 2009.
  Management does not anticipate that the adoption of these standards will have a material impact on the financial statements.
  14
  FLURIDA GROUP, INC. AND SUBSIDIARIES
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
 NOTE C – RELATED PARTY TRANSACTIONS
 
 Common Shares Issued to Executive and Non-Executive Officers and Directors
 
 As of December 31, 2008, total 32,129,960 shares were issued to officers and directors.  Please see the Table below for details:
 
 Name

Total Shares


Total Amount


PercentageFenglan  Li


165,000



15,750



0.42
%Fuling Li


115,000



10,750



0.29
%Ying Zhong


2,000,000



200,000



5.13
%Gian Franco Barbieri


102,000



9,700



0.26
%Xiaoyong Fu


750,000



75,000



1.92
%Jianfeng Ding & YaruHuang


28,997,760



325,998



74.37
%Total


32,129,760


$
637,197.76



82.39
%
 
 * Based on total issued shares as of December 31, 2008: 38,990,827
 
 At July 23, 2009, the Company's founders Jianfeng Ding and Yaru Huang transferred total 2,000,000 of their common shares to Chuanyun Mu and Xia Liu as a gift. Therefore, as of March 31, 2011, total 30,129,960 shares were issued to officers and directors.  Please see the table below for details:
 
 Name

Total Shares


Total Amount


PercentageFenglan  Li


165,000



15,750



0.42
%Fuling Li


115,000



10,750



0.29
%Ying Zhong


2,000,000



200,000



5.13
%Gian Franco Barbieri


102,000



9,700



0.26
%Xiaoyong Fu


750,000



75,000



1.92
%Jianfeng Ding & YaruHuang


26,997,760



323,998



69.24
%Total


30,129,760


$
635,198



77.26
%
 
 ·
Based on total issued shares as of December 31, 2009: 38,990,827.
 ·
Total outstanding issued shares as of March 31, 2011: 38,990,827
  15
 
 FLURIDA GROUP, INC. AND SUBSIDIARIES
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
 NOTE C – RELATED PARTY TRANSACTIONS (Continued)
 
 Cost of Goods Sold
 
 The Company’s purchase is primarily from supplier, Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd., owned 100% by the founder of the Company, Jianfeng Ding.  Due to Jianfeng Ding, and Yaru Huang, husband and wife, combined hold 69.24% issued common shares for Flurida Group, Inc., the two entities, Flurida Group, Inc., and Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd., are under conmmon control according to EITF 02-5.
 
 The products the Company will sell are manufactured in China by Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd. (“Zhong Nan Fu Rui”).  It was established in 2005 specializing in home appliance components and subassemblies manufacturing, and located in Qingdao City, Shandong Province, China.  On September 18, 2007, amended June 25, 2008 and further amended on August 4, 2008, Flurida Group, Inc. signed a five year distribution agreement with Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd.  Zhong Nan Fu Rui is a Chinese manufacturing company owned 100% by Mr. Jianfeng Ding, our president.  Under the terms of the agreement Zhong Nan Fu Rui authorizes Flurida to be its exclusive sales agent for the ice making product lines, including icemaker and ice water dispensing systems all over the world. The ice making product lines shall include the products that Zhong Nan Fu Rui developed before the agreement signed and the products that will be developed solely by Zhong Nan Fu Rui during the term of the agreement. Zhong Nan Fu Rui is the exclusive supplier of the products we sell.  Although the distribution agreement requires that the purchase price we will pay for these products will be comparable to what the Flurida would have paid a non-related party in market price, Mr. Ding may face a conflict in calculating the price the products are sold to Flurida and the determining amount of products the Flurida purchase.  However, because Mr. Ding has a fiduciary duty to Flurida and the shareholders, he has indicated that he will assure strict adherence to this provision of the agreement and will not require Flurida to purchase a quantity of products in excess of that which Flurida can reasonably afford or reasonably expect to sell in within two to three months of our purchase of the products.
 
 The management of Flurida Group, Inc. believes that the purchase price for the parts from Zhong Nan Fu Rui will be market price.  Flurida Group, Inc. and Zhong Nan Fu Rui are two totally separated entities, i.e., Flurida Group, Inc. is a USA corporation and will fully comply with USA regulations and USA general accepted accounting principles; Zhong Nan Fu Rui is a Chinese company and it will comply with Chinese legal systems.
  16
 
 FLURIDA GROUP, INC. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
 NOTE C – RELATED PARTY TRANSACTIONS (Continued)
 
 Cost of Goods Sold ( Continued)
 
 Flurida Group, Inc. and Zhong Nan Fu Rui will operate independently.  Zhong Nan Fu Rui, as a Chinese local manufacturer, will record their manufacturing costs and inventories based on the Chinese accounting regulations rulings.  But, when Flurida Group, Inc. purchases the parts from Zhong Nan Fu Rui, Flurida Group will record the actual costs paid to Zhong Nan Fu Rui as the costs for inventory of Flurida Group, Inc.  There is no any relationship for Zhong Nan Fu Rui’s manufacturing historic costs with Flurida Group’s inventory value.  Specifically, Flurida’s inventory value is equal to the purchase price or actual cost of the parts purchased from Zhong Nan Fu Rui, and the purchase price of the parts will be fair market price.  Flurida Group, Inc. will adopt the first-in and first-out inventory system according to generally accepted accounting principles in USA.
 
 The management of Zhong Nan Fu Rui disclosed to Flurida Group, Inc. that, Zhong Nan Fu Rui adopted the cost plus pricing policies with market adjustment, negotiable with customers.  Zhong Nan Fu Rui adopted the cost plus system for all the products for all customers including the product, icemakers exclusively distributed by Flurida Group, Inc.  Specifically, the selling price is determined by total actual manufacturing cost of direct manufacturing materials (parts), direct manufacturing labor, and allocated manufacturing overhead cost, plus 5-10% of total manufacturing cost.  Zhong Nan Fu Rui’s minimum gross profit margin is 5%.
 
 Flurida Group also purchased the products from suppliers, Qingdao Fubida Electronics Co., Ltd, Shanghai Fulu International Trading Co., Ltd, and Chuzhou Fuda Mechanical and Electronics Co., Ltd on purchase orders basis.
 
 Qingdao Fubida Electronics Co., Ltd, owned 100% indirectly by Jianfeng Ding and Yaru Huang, husband and wife. Qingdao Fubida Electronics Co., Ltd is a manufacturing company, and it was established in 2003 specializing in home appliance control components and subassemblies manufacturing, and located in Qingdao City, Shandong Province, China. The plant space is around 70,000 sq ft. 14units injection molding machine up to 600 metric tons.
 
 Shanghai Fulu International Trading Co., Ltd. a trading company established in 2007, located at Shanghai, China, 100% owned indirectly by Jianfeng Ding and Yaru Huang.
  17
 
 FLURIDA GROUP, INC. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
 NOTE C – RELATED PARTY TRANSACTIONS (Continued)
 
 Cost of Goods Sold ( Continued)
 
 Chuzhou Fuda  Mechanical & Electronics Co., Ltd. owned 100% indirectly by Jianfeng Ding and Yaru Huang, husband and wife is an appliance components and sub-assemblies manufacturer established on March 18, 2008. Chuzhou Fuda is located in Chuzhou City, Anhui Province, China. The plant space is around 100,000sq. ft. with 18 molding machine up to 800 metric ton and 6 assemblies lines for appliance components and assemblies.
 
 At the year ended 2010, the Company had ending inventory of $ 1,533,220 that was purchased from Zhong Nan Fu Rui and ChuZhou FuDa, included 39,151 pieces Icemakers and 355,320 pieces Motors.
 
 From the period January 1 to March 31, 2011, Flurida Group, Inc. purchased Motors and parts from Zhong Nan Fu Rui at total cost of $ 1,935,726 for FOB shipping point at Qingdao, China.
 
 The total parts price from Zhong Nan Fu Rui consists of 80% of direct manufacturing materials and labor, 10% of allocated manufacturing overhead, and 10% of profit margin.
 
 Flurida Group, Inc. also purchased Motors, Deflectors, Icemakers, Magnets, Dac boxes, and other related parts from Qingdao Fubida Electronics Co., Ltd. at total cost of $188,602 for FOB shipping point at Qingdao, China.
 
 The Company purchased Icemakers and parts from ChuZhou FuDa at total cost of $ 345,488 for FOB shipping point at Nanjing, China.
 
 In addition, Flurida Group, Inc. purchased Magnets, Icemakers, Timers and related parts from Shanghai Fulu International Trading Co., Ltd., at total cost of $7,266 for FOB shipping point at Shanghai, China.
 
 To manufacture the related refrigerator appliance parts, Zhong Nan Fu Rui and Qingdao Fubida Electronics Co., needs key parts made in USA, which were purchased through Flurida Group, Inc. in USA.  The costs of purchasing the parts were $ 61,060 in 2010.
 
 From the period of January to March 31, 2011, the Company had total purchase of $ 2,538,142.
  18
 
 FLURIDA GROUP, INC. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
 NOTE C – RELATED PARTY TRANSACTIONS (Continued)
 
 Cost of Goods Sold ( Continued)
 
 At the period ended March 31, 2011, the Company had ending inventory $1,400,857.
 
 For the period January 1 March 31, 2011, the company had freight cost of $7,242.
 
 Therefore, in the period ended March 31, 2011, the Company incurred a total cost of good sold of $ 2,677,747.
 
 Loan to Supplier
 
 At July 1st,2009, Flurida Group, Inc. loan $278,091 to the company’s primary supplier, Zhong Nan Fu Rui. The outstanding balance bears interest at 5.31%, pursuant to a written agreement, for the term from July 1st 2009 to June 30th 2010. This receivable was due on demand.  At July 1st 2010, the loan agreement is renewed for another year by both parties at an interest rate of 5.31%.
 
 On August 6, 2010, the Company advanced additional $6,535.59 to related party supplier, Zhong Nan Fu Rui for the same interest of $5.31% without written agreement.  The payment term is on demand.
 
 NOTE D – SHAREHOLDERS’ EQUITY
 
 During the year ended December 31, 2008, Flurida Group, Inc has issued total 11,699,067 new shares on April 15, 2008, including 11,649,067 shares issued to loan holders who converted all the loans to common shares. At the year ended December 31, 2008, Flurida Group, Inc. incurred net loss of $ (194,079).
 
 Therefore, the total stockholders’ equity balance at December 31, 2008 was $ 1,075,377.
 
 On April 15, 2008, 50,000 shares issued to Williams Law Group at $ 0.10, for the legal service value of $5,000.  On April 1, 2008, seven non-affiliated loan holders asked for repayment of their loans in the aggregate amount of $ 25,066 plus the total interest cost of $624.72, which was paid on the same date, April 1, 2008; meantime, seven additional lenders loaned an aggregate amount of $ 9,926.
  19
 
 FLURIDA GROUP, INC. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
 NOTE D – SHAREHOLDERS’ EQUITY (Continue)
 
 On April 15, 2008, total loan amount of $1,164,906 was converted to common shares at price of $0.10 per share, for the total shares of 11,649,067 shares, which were issued to the loans holders.
 
 There were no new shares issued during the period ending December 31, 2010.
 
 There were no new shares issued during the period ending March 31, 2011.
 
 Therefore, as of March 31, 2011 total shares issued and outstanding are 38,990,827.
 
 NOTE E – GOING CONCERN
 
 The Company’s operating history and financial resources may raise doubt about its ability to continue as a going concern.  The financial statements do not include adjustments that might result from the outcome of this uncertainty and if the Company is unable to generate significant revenue or secure financing, then the Company may be required to cease or curtail its operations.  In the first quarter of 2011, the Company generated sales revenue of $3,019,787.  The Company’s most concentrated customer is Electrolux located in various countries.  If Electrolux discontinue the purchase which may be very unlikely in near future, the Company may face the ability to continue as a going concern.  However, due to the close relationship between the Company and it’s suppliers, Zhong Nan Fu Rui and Qingdao Fubida Electronics Co., which are 100% owned by the founder, Jianfeng Ding.  Zhong Nan Fu Rui and Qingdao Fubida Electronics Co.’s current customers can be served by the Company for the same quality of products and services.  Besides, as of March 31, 2011, the cash and cash equivalent balance was $684,078, the management believes that the revenues will be generated and its cash flows will be maintained to cover its operational costs and the risk of going concern in long term is significantly low.
  20
 
 Exhibit A
 
 Three Months Ended


Three Months EndedMarch 31, 2011


March 31, 2010Selling, general and administrative expensesAdministration Expense


1,507.11



4,910.00Bank Service Charges


594.24



350.11Business operation tax


-



578.65Business Registration


-



423.50Certification


20,858.45



15,608.94Computer and Internet Expenses


232.05



217.14Flurida Europe Operating Expense


-



21,336.25Fuel charge


480.71



-Gift and promotion


-



259.66Industry Show


-



100.00Meals and Entertainment


8,183.97



-Office Supplies


6,881.84



1,788.29Parking fee


192.00



4.60Payroll Expense - ER


11,401.30



9,256.56Payroll Expenses - EE


135,144.56



99,480.00Postage & Shipping


499.22



353.22Professional Fees


12,855.81



26,982.01Rent Expense


8,876.68



5,130.00Repair & Maintenance


-



178.12Service Cost


1,236.07



-Telephone Expense


2,227.93



809.51Travel ExpenseAirfare


10,723.78



5,191.30Car Rental


1,571.78



-Hotel Expense


5,210.21



2,280.59Local Transportation


316.93



-Travel Expense - Other


590.02



2,535.77Total Travel Expense


18,412.72



10,007.66Utilities


523.96



282.64Total Expense


230,108.62



198,056.86
  21




Item 2.   Management’s Discussion and Analysis or Plan of Operation.





This 10−Q contains forward-looking statements. Our actual results could differ materially from those set forth as a result of general economic conditions and changes in the assumptions used in making such forward-looking statements. The following discussion and analysis of our financial condition and results of operations should be read together with the audited consolidated financial statements and accompanying notes and the other financial information appearing else where in this report. The analysis set forth below is provided pursuant to applicable Securities and Exchange Commission regulations and is not intended to serve as a basis for projections of future events. Refer also to "Cautionary Note Regarding Forward Looking Statements" and “Risk Factors” below.





Overview





Our business is the sale of appliance parts in Asia, Europe, Australia, North and South America.  The main products that we sell to these markets are icemakers, motors, ice water dispensing system, and appliance assemblies.





These parts are manufactured in China by Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd. (“Zhong Nan Fu Rui”)





Zhong Nan Fu Rui was established in 2005 specializing in home appliance components and subassemblies manufacturing, and located in Qingdao City, Shandong Province, China.  On September 18, 2007, amended June 25, 2008 and further amended on August 4, 2008, Flurida Group, Inc. signed a long-term distribution agreement with Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd.  Zhong Nan Fu Rui is a Chinese manufacturing company owned 100% by Mr. Jianfeng Ding, our president.





Flurida Group also purchased the products from suppliers, Qingdao Fubida Electronics Co., Ltd, Shanghai Fulu International Trading Co., Ltd, and Chuzhou Fuda Mechanical and Electronics Co., Ltd on purchase orders basis.





Qingdao Fubida Electronics Co., Ltd, owned 100% indirectly by Jianfeng Ding and Yaru Huang, husband and wife. Qingdao Fubida Electronics Co., Ltd is a manufacturing company, and it was established in 2003 specializing in home appliance control components and subassemblies manufacturing, and located in Qingdao City, Shandong Province, China. The plant space is around 70,000 sq ft. 14units injection molding machine up to 600 metric tons.





Shanghai Fulu International Trading Co., Ltd. a trading company established in 2007, located at Shanghai, China, 100% owned indirectly by Jianfeng Ding and Yaru Huang.





Chuzhou Fuda  Mechanical & Electronics Co., Ltd. owned 100% indirectly by Jianfeng Ding and Yaru Huang, husband and wife is an appliance components and sub-assemblies manufacturer established on March 18, 2008. Chuzhou Fuda is located in Chuzhou City, Anhui Province, China. The plant space is around 100,000sq. ft. with 18 molding machine up to 800 metric ton and 6 assemblies lines for appliance components and assemblies.





We sell the following types of appliance parts:






Automatic Refrigerator Build-in Icemaker:The automatic refrigerator build-in icemaker is designed for household refrigeration products, such as refrigerator, under-counter refrigerator, freezer to make the ice cubes automatically.





4





Refrigerator Through-Door Ice Water System:Refrigeration Through-Door Ice Water System is the system that stores the ice cubes harvested from the icemaker, delivered and dispensed the ice, crushed ice or water to the refrigerator door through the electronic control system at the front of the refrigerator door. The through-door ice water system normally includes the following assemblies: ice bucket assembly, motor rail assembly, module assembly, facade assembly, housing assembly. The ice bucket assembly and the motor rail assembly can be located in the freezer, in the refrigerator door and or sealed chamber in the refrigerator. The module assembly, facade assembly and housing assembly vary according to the specific design from each client.






Shade Pole Motor and Motor Assembly for Refrigerator or Freezers:The shade pole motor and motor assembly is a key part for refrigerators or freezers.  Flurida Group Inc’s motor part is designed and specified for the refrigerators or freezers made by Electrolux, an US company with headquarter in Charlotte, NC. Flurida also supplies the motors and motor assemblies to Electrolux Europe facilities in Italy and Hungary.





Results of Operations





For the fiscal quarters ended March 31, 2011 vs. March 31, 2010.





Revenue





For the fiscal quarter ended March 31, 2010, we had revenue of $2,486,665.





For the first quarter ended March 31,2011, the Company had total net revenue of $ 3,019,787 .





For the period January 1 to March 31, 2011, the Company sold total quantity of 36,483 icemakers and 606,960 motors to, Electrolux USA, located at Charlotte NC for sales of $ 2,181,012. The motors were manufactured and supplied by Zhong Nan Fu Rui; all the motors were shipped out at FOB shipping point Qingdao, China.  And the icemakers were manufactured and supplied by ChuZhou FuDa Mechanical & Electronics Co., Ltd; all the icemakers were shipped out at FOB shipping point Nanjing, China.





The Company sold motors to another US company, Master Precision Global (MPG), a sub-assembler to Electrolux, for $121,867. The motors were manufactured and supplied by Zhong Nan Fu Rui, and shipped out at FOB shipping point at Qingdao, China.





The Company sold 480 icemakers, 500 components, and tooling service to Electrolux –Australia for $ 135,447. The icemakers were manufactured and supplied by Chu Zhou Fu Da Mechanical & Electronics; all the icemakers were shipped out at FOB shipping point Nanjing, China.





The Company also sold DAC Boxes to Electrolux –Sweden for $ 5,990. The DAC Box were manufactured and supplied by Qingdao Fu Bi Da; all the DAC Boxes were shipped out at FOB shipping point Qingdao, China.





The Company sold 24,156 DAC Boxes, 11,693 Deflector, 2,000 push buttons, 22,284 Magnets, 3,000 Motors and other related parts to Electrolux –Italy for total $ 152,804. The DAC Boxes, Magnets, Motors and other related parts were manufactured and supplied by Zhong Nan Fu Rui, and Qingdao Fu Bi Da; all the DAC Boxes magnets, and motors were shipped out at FOB shipping point Qingdao, China.





5





The Company also sold 15,408 DAC Boxes, 14,976 Magnets, 22,400 Motors, and other related parts to Electrolux – Hungry for total $ 143,876. The DAC Boxes, magnets and Motors were manufactured and supplied by Zhong Nan Fu Rui, and Qingdao Fu Bi Da respectively; all the DAC Boxes magnet, and motors were shipped out at FOB shipping point Qingdao, China.





The company sold 18,144 Motors, 944 icemakers, and some related refrigerator appliance parts to North Carolina Electrolux Major Appliances, Inc for $ 65,959. The parts were manufactured and supplied by Zhong Nan Fu Rui, and were shipped out at FOB shipping point at Qingdao, China.





In the first quarter of 2011, the Company sold thermostats and other related key parts for icemakers and motors, to Zhong Nan Fu Rui. The parts were exclusively used for the icemakers and motors purchase order by Electrolux.  Flurida Group purchased the parts from Wako Electronics, Inc., an US Company located at Louisville, KY 40299.  Flurida Group also sold Rocker Switch, the key parts for icemakers, to Zhong Nan Fu Rui.  The parts, Rocker Switch, were exclusively used for the icemakers purchase order by Electrolux.  The Company purchased the parts, Rocker Switch, from CW Industries, an US Company located atSouthampton, PA; and also Flurida Group purchased some other related key parts from corporate America, and then sold to Zhong Nan Fu Rui, Qingdao Fubida Electronics Co., Ltd and ChuZhou FuDa Electronics Co., Ltd. Flurida Group, Inc. addsaveraged 5% - 10% margin based on the cost of purchase, then sold to them, so, $ 46,281 were sold and invoiced to Zhong Nan Fu Rui.





The company sold thermostats to an US company, Exact Peplacement Parts for $ 22,400. The parts were manufactured and supplied by Zhong Nan Fu Rui, and were shipped out at FOB shipping point at Qingdao, China.





Also, from January 1 to March 31, 2011, the company sold $ 142,800 tooling service to General Electric Company, a US company located at Louisville, KY; and had other service income of $ 1,350.





In summary, as of March 31, 2011, the Company incurred the total sales of $ 3,019,787 from selling the parts and tooling services, comparing with the $2,186,665 for the period ended March 2010, increase of 38%.




For the 2011 and 2010 first quarter sales, about 2% revenues were generated by Electrolux- Australia; 45% by Electrolux-Anderson USA; 22% by Electrolux-Mexico, 8% by Electrolux-Italy; 6% by Electrolux-Hungry; 2% by General Electric Company; 7% by Master Precision Global; and 3% by Zhong Nan Fu Rui.  Electrolux operated its each subsidiary independently in each country, and all the sales orders and sales contracts were negotiated and signed independently.  Accordingly, we believe that lack of one or a few subsidiaries of Electrolux sales order may not have significant effect on our overall sales revenue, and such effects were slightly reduced in 2011 vs 2010.  We signed long-term distribution agreement with Electrolux, the risk of loss the contracts with Electrolux is significantly low.




Cost of Revenue





Our Costs of Goods Sold, as we expected will increased slightly due to increasing Chinese Yuan’s currency exchange rate, labor costs, and raw materials.  We anticipate this trend to continue and may adjust our unit price upward to reduce the impact of rising costs.





For the period ended March 31, 2011, the Company incurred a total cost of goods sold of $ 2,677,747 compared to $ 1,983,730 for the three months period ended March 31, 2010.





At the year ended 2010, the Company had ending inventory of $ 1,533,220 that was purchased from Zhong Nan Fu Rui and ChuZhou FuDa, included 39,151 pieces Icemakers and 355,320 pieces Motors.





From the period January 1 to March 31, 2011, Flurida Group, Inc. purchased Motors and parts from Zhong Nan Fu Rui at total cost of $ 1,935,726 for FOB shipping point at Qingdao, China.





Flurida Group, Inc. also purchased Motors, Deflectors, Icemakers, Magnets, Dac boxes, and other related parts from Qingdao Fubida Electronics Co., Ltd. at total cost of $188,602 for FOB shipping point at Qingdao, China.





The Company purchased Icemakers and parts from ChuZhou FuDa at total cost of $ 345,488 for FOB shipping point at Nanjing, China.





6


In addition, Flurida Group, Inc. purchased Magnets, Icemakers, Timers and related parts from Shanghai Fulu International Trading Co., Ltd., at total cost of $7,266 for FOB shipping point at Shanghai, China.





To manufacture the related refrigerator appliance parts, Zhong Nan Fu Rui and Qingdao Fubida Electronics Co., needs key parts made in USA, which were purchased through Flurida Group, Inc. in USA.  The costs of purchasing the parts were $ 61,060 in 2010.





From the period of January to March 31, 2011, the Company had total purchase of $ 2,538,142.





At the period ended March 31, 2011, the Company had ending inventory $1,400,857.





For the three months period ended March 31, 2011, the company had freight cost of $7,242.





Therefore, in the period January 1 to March 31, 2011, the Company incurred a total cost of good sold of $2,677,747.





The cost of goods sold in the Statements of Operations includes costs of products purchased from suppliers, shipping costs or freight in costs for the products shipping FOB port China, and other costs if any directly related to the products inspection, duty and custom taxes of products, internal transfer costs if any.  The selling, general and administrative expense includes operation expense such as travel, professional, office rent, telephone, certification fees, wages and salaries for management and administrative employees, and other expense related to operation.  There was no allocation of portion of any selling, general and administrative expense to the cost of goods sold.





Our gross margin may not be comparable to those of other entities, since some other entities may include all or allocate portion of the costs related to their distribution network into cost of goods sold.





Expense





Our Operating expenses consist of selling, general and administrative expenses.





Three Months Ended


Three Months EndedMarch 31, 2011


March 31, 2010Selling, general and administrative expensesAdministration Expense


1,507.11



4,910.00Bank Service Charges


594.24



350.11Business operation tax


-



578.65Business Registration


-



423.50Certification


20,858.45



15,608.94Computer and Internet Expenses


232.05



217.14Flurida Europe Operating Expense


-



21,336.25Fuel charge


480.71



-Gift and promotion


-



259.66Industry Show


-



100.00Meals and Entertainment


8,183.97



-Office Supplies


6,881.84



1,788.29Parking fee


192.00



4.60Payroll Expense - ER


11,401.30



9,256.56Payroll Expenses - EE


135,144.56



99,480.00Postage & Shipping


499.22



353.22Professional Fees


12,855.81



26,982.01Rent Expense


8,876.68



5,130.00Repair & Maintenance


-



178.12Service Cost


1,236.07



-Telephone Expense


2,227.93



809.51Travel ExpenseAirfare


10,723.78



5,191.30Car Rental


1,571.78



-Hotel Expense


5,210.21



2,280.59Local Transportation


316.93



-Travel Expense - Other


590.02



2,535.77Total Travel Expense


18,412.72



10,007.66Utilities


523.96



282.64Total Expense


230,108.62



198,056.86




7




Started from January 2011, Flurida Group had salaries for officers Jianfeng Ding, Yaru Huang, and Ying Zhong for $350,000, $80,000, $ 80,000. The Social Security tax and Medicare tax were paid by both employer and employees in USA; employees also withheld portion of Federal and State tax calculate by each individual’s status. All of the tax was submitted to Internal Revenue Service and local government at a semiweekly basis. The Company incurred a total payroll expense of $146,546 for the period end March 31, 2011.  For maintaining and operating the business, the Company expensed a total of $ 12,856 professional fee, which was included the accounting fee, commission and consulting fee for enlarge sales volume, and other professional expenses. In order to increasing the sales in Europe and North America, the Company expensed $ 20,858 certification fees on the products we sold or exported in the period of January 1 to March 31, 2011.





We expect selling, general, and administrative expenses to increase in future periods as we initiate a number of marketing and promotional activities.





Income Taxes





We are subject to income taxes in the U.S., while the subsidiary in Italy is subject to the income tax laws of Italy.We incurred income tax expense of $53,350 for the period of January 1 to March 31, 2011; it was consisted of $ 41,500 of federal income tax, $11,000 state income tax for Illinois, and $850 income and franchise tax for California. As of March 31, 2011, the company had income taxes payable of $ 88,350.





Net Income





We had a net income of $58,858 and $53,569 for the three months period ended March 31, 2011 and 2010 respectively.  The net income in the first quarter 2011 was increased 10% comparing to the three months period ended 2010 due to the overall increase of sales revenue.





Commitments and Contingencies





The Company has signed a long-term distribution agreement with Zhong Nan Fu Rui Mechanical Electronics Manufacturing Co., Ltd.  Zhong Nan Fu Rui is a Chinese manufacturing company owned 100% by Mr. Jianfeng Ding, also the founder of Flurida Group, Inc.  Also, On June 2008, the company signed a consigned inventory agreement with an US company, Electrolux Home Products DE Mexico, S.A.DEC.V (Electrolux).





8




Foreign Currency Translation





The Company has determined the United States dollars to be its functional currency; and European Euro to be its functional currency for our Italian subsidiary.  Assets and liabilities were translated to U.S. dollars at the period-end exchange rate. Statement of operations amounts were translated to U.S. dollars using the historic rate, i.e., the rate at first date of each month during the year.  Gains and losses resulting from translating foreign currency financial statements are accumulated in other comprehensive income (loss), a separate component of shareholders’ equity.





Liquidity and Capital Resources





At March 31


At March 31


At December 312011


2010


2010Current Ratio*


1.51



1.59



1.39Cash

$
684,078


$
318,204


$
992,825Working Capital**

$
1,141,611


$
1,034,519


$
1,094,366Total Assets

$
4,505,577


$
3,561,910


$
5,168,018Total Liabilities

$
2,982,963


$
2,238,220


$
3,714,319Total Equity

$
1,526,829


$
1,323,690


$
1,453,699Total Debt/Equity***


1.95



1.69



2.56





*Current Ratio = Current Assets /Current Liabilities





**Working Capital = Current Assets - Current Liabilities





*** Total Debt / Equity = Total Liabilities / Total Shareholders Equity.





The Company’s overall working capital was increased in the period ended March 31, 2011 comparing to the period ended March 31,2010, due to the overall increase of the cash balance, increase of accounts receivable, and increase of the accounts payable;





Currently the Company has a sales agreement with Electrolux, such agreement require the Company to supply the motors, ice makers, and other parts based on Electrolux’s needs.  The management projected that the needs for our Company’s products shall be stable with slight increase worldwide.  However, due to the consignment arrangement with Electrolux, the Company would keep certain level of consignment inventory to meet the Electrolux’s requirements.  In addition, due to the consignment terms with Electrolux, the sales would be recognized when the Electrolux withdraw the products or the consignment inventory at Electrolux’s warehouse for 60 days.  In our due course of business dealing with Electrolux’s consignment sales, all the sales incurred in the period January 1 March 31 2011 were for the products withdrew before the 60 days terms, i.e., the products might be considered as sales automatically based on the consignment terms.  After the products withdrew by Electrolux, the Company may receive the payment in 30 days.  Therefore, in general, there would be at least 90 days to collect payment after the products shipped to Electrolux’s warehouse.  Such long payment cycle may cause the Company to set up the similar payment terms or arrangement with the Company’s suppliers, for example, the major supplier, Zhong Nan Fu Rui.  Accordingly, the accounts payables would be increased too.  Therefore, the management projected that the trend of decrease of current ratio may be continued in the year 2011, due to the possibilities of late payment of accounts receivables, and the increase of the accounts payables.





9




Our activities for generating cash flows were operating activities in 2011 and 2010.  There were no investing and financing activities incurred for the period ended March 31, 2011, and 2010.  The management will continue to focus on the operating activities, particularly focus on marketing, customer services, and general administrative activities to improve overall operation effectiveness.  Specifically, the management believes that within the operating activities, the efforts of collecting accounts receivables and making payments of accounts payables still are the primary factors for the changes of cash flows in the year 2011 or later.





The Company had cash and cash equivalents of $ 684,078 at March 31, 2011 and $ 1,141,611 of working capital and $ 318,204 at March 31, 2010 and $ 1,034,519 of working capital.





The total debt of $2,238,220 for March 31, 2010 that is included the amount of $ 2,178,220 accounts payable and $ 60,000 unearned revenue.





The total debt of $2,982,963 for March 31, 2011 included total of $ 2,892,249 account payable, which was consisted of $ 2,245,092 for Zhong Nan Fu Rui, $ 265,722 for Chu Zhou Fu Da, $ 280,369 for Qiongdao Fu Bi Da, $ 39,891 for Shang Hai Fu Lu International Trading, and $ 14,964 for US suppliers, $ 33573 for salary and payroll tax payable, and $ 12,637 for all other account payable; as well as $88,350 for income tax payable, and $2,364 unearned income.





Our independent auditor has indicated that our lack of operating history and financial resources raise substantial doubt about its ability to continue as a going concern. The financial statements do not include adjustments that might result from the outcome of this uncertainty and if the Company is unable to generate significant revenue or secure financing, then the Company may be required to cease or curtail its operations. However, due to the close relationship between the Company and it’s supplier, Zhong Nan Fu Rui, which is 100% owned by the founder, Jianfeng Ding, Zhong Nan Fu Rui’s current customers can be served by the Company for the same quality of products and services. Besides, as of March 31, 2011, the cash and cash equivalent balance was $684,078 , the management believes that the revenues will be generated and its cash flows will be maintained to cover its operational costs and the risk of going concern in long term is significantly low.





Interest Rate Risk





We do not have significant interest rate risk, as our debt obligations (i.e., notes payables to shareholders which can be converted to common stocks).  The annual interest rate of notes payable is 8%, and the interest expense would be accrued if the notes were not converted to common shares, and the notes holders request the Company for repayment of principles plus the interest.  Seven non-affiliated loan holders asked the Company for repayment of notes plus interest on April 1, 2008.  All remaining loan holders converted their loans to common shares on April 15, 2008.





Item 3.  Quantitative and Qualitative Disclosure about Market Risk





Not applicable.





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Item 4.  Controls and Procedures.





Evaluation of Disclosure Controls and Procedures





The Company’s Chief Executive Officer and Chief Financial Officer have evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of March 31, 2011. Based upon such evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that, as of March 31, 2011, the Company’s disclosure controls and procedures were not effective. This conclusion by the Company’s Chief Executive Officer and Chief Financial Officer does not relate to reporting periods after March 31, 2011 .





Changes in Internal Control over Financial Reporting





There have been no changes in the Company's internal control over financial reporting that occurred during the Company's last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.





PART II — OTHER INFORMATION





Item 1.  Legal Proceedings.





None.





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





(a)                 Unregistered Sales of Equity Securities.





The Registrant did not sell any unregistered securities during the three months ended March 31, 2011.





(b)                 Use of Proceeds.





The Registrant did not sell any unregistered securities during the three months ended March 31, 2011.





Item 3.  Defaults Upon Senior Securities





None.





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Item 4. (Removed and Reserved).





Item 5.  Other Information.





Not applicable.





Item 6.  Exhibits.





(a)
Exhibits.




Exhibit

No.

Document Description31.1

CERTIFICATION of CEO PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002.31.2

CERTIFICATION of CFO PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002.32.1

CERTIFICATION of CEO PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEYACT OF 200232.2

CERTIFICATION of CFO PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEYACT OF 2002








*  This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 of the Securities Exchange Act of 1934, whether made before or after the date hereof and irrespective of any general incorporation language in any filings.





SIGNATURES





In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.





Flurida Group, Inc., a Nevada corporation





Title

Name

Date

SignaturePrincipal Executive Officer

Jianfeng Ding

May 16, 2011

/s/ Jianfeng Ding





In accordance with the Exchange Act, this Report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.





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SIGNATURE

NAME

TITLE

DATE/s/ Jianfeng Ding

Jianfeng Ding

Principal Executive Officer and Director

May 16, 2011/s/ Yaru Hang

Yaru Hang

Principal Financial Officer and Principal Accounting Officer

May 16, 2011




13




EXHIBIT INDEX





Exhibit

No.

Document Description31.1

CERTIFICATION of CEO PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002.31.2

CERTIFICATION of CFO PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002.32.1

CERTIFICATION of CEO PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEYACT OF 200232.2

CERTIFICATION of CFO PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEYACT OF 2002








*  This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 of the Securities Exchange Act of 1934, whether made before or after the date hereof and irrespective of any general incorporation language in any filings.





14