0001354488-12-004527.txt : 20120823 0001354488-12-004527.hdr.sgml : 20120823 20120823124523 ACCESSION NUMBER: 0001354488-12-004527 CONFORMED SUBMISSION TYPE: 10-Q/A PUBLIC DOCUMENT COUNT: 7 CONFORMED PERIOD OF REPORT: 20120630 FILED AS OF DATE: 20120823 DATE AS OF CHANGE: 20120823 FILER: COMPANY DATA: COMPANY CONFORMED NAME: COCONNECT INC CENTRAL INDEX KEY: 0001088638 STANDARD INDUSTRIAL CLASSIFICATION: BLANK CHECKS [6770] IRS NUMBER: 631205304 STATE OF INCORPORATION: NV FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q/A SEC ACT: 1934 Act SEC FILE NUMBER: 000-26533 FILM NUMBER: 121051635 BUSINESS ADDRESS: STREET 1: 480 EAST 6400 SOUTH STREET 2: SUITE 230 CITY: MURRAY STATE: UT ZIP: 84107 BUSINESS PHONE: 801-266-9393 MAIL ADDRESS: STREET 1: 480 EAST 6400 SOUTH STREET 2: SUITE 230 CITY: MURRAY STATE: UT ZIP: 84107 FORMER COMPANY: FORMER CONFORMED NAME: ADVANCED WIRELESS SYSTEMS INC DATE OF NAME CHANGE: 19990611 10-Q/A 1 ccon_10qa.htm AMENDMENT NO 1 ccon_10qa.htm


SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 10-Q/A
(Amendment No. 1)
 
þ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly period ended   June 30, 2012
 
o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE  SECURITIES EXCHANGE ACT OF 1934
 
Commission File Number: 000-29735
 
 
COCONNECT, INC.
 
Nevada
 
63-1205304
(State or other jurisdiction
 
(IRS Employer
of Incorporation)
 
Identification Number)
 
25 East 200 South
Lehi, Utah 84043
(Address of principal executive offices)
 
801-592-3000
(Issuer’s Telephone Number)
 
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 þ  No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T(Section 232.405 of this chapter) during the preceding 12 months(or such shorter period that the registrant was required to submit and post such files. Yes o  No þ
 
Indicate by check mark whether the registrant is a large accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer,” and “small reporting company” in Rule 12b-2 of the Exchange Act.
 
Large accelerated filer      o                                                                                                            Accelerated filer                   o
Non-accelerated filer        o (Do not check if a smaller reporting company)                           Smaller reporting company  þ
 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act)     Yes þ   No o
  
2,750,000 common shares outstanding, $0.001 par value, as of August 20, 2012
  


 
 

 
 
Explanatory Note

The purpose of this Amendment No. 1 to CoConnect Inc. Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2012, filed with the Securities and Exchange Commission on Auguest 20, 2012  (the “Form 10-Q”), is solely to furnish Exhibit 101 to the Form 10-Q in accordance with Rule 405 of Regulation S-T. Exhibit 101 to this report provides the consolidated financial statements and related notes from the Form 10-Q formatted in XBRL (eXtensible Business Reporting Language).
 
No other changes have been made to the Form 10-Q. This Amendment No. 1 to the Form 10-Q speaks as of the original filing date of the Form 10-Q, does not reflect events that may have occurred subsequent to the original filing date, and does not modify or update in any way disclosures made in the original Form 10-Q.
 
Pursuant to Rule 406T of Regulation S-T, the interactive data files on Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.
 
 
 
 

 
 

Item 6.
 
Exhibits
31.1*  
Certification of CEO/CFO pursuant to Sec. 302
32.1*  
Certification of CEO/CFO pursuant to Sec. 906
 
101.DEF
 
XBRL Taxonomy Extension Definition Linkbase Document
101.INS
 
XBRL Instance Document
101SCH
 
XBRL Taxonomy Extension Schema Document
101.CAL
 
XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB
 
XBRL Taxonomy Extension Label Linkbase Document
101.PRE
 
XBRL Taxonomy Extension Presentation Linkbase Document
101.DEF
 
 XBRL Taxonomy Extension Definition Linkbase Document
     
_________
*           These exhibits were previously included or incorporated by reference in CoConnect Inc. Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2012, filed with the Securities and Exchange Commission on August 20, 2012.

 
 

 

SIGNATURES

In accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant caused this report to be signed on its behalf on August 20, 2012, by the undersigned, thereunto duly authorized.
 
 
COCONNECT, INC.
 
       
Date: August 23, 2012
By:
/s/ Mark L. Baum
 
   
By: Mark L. Baum, Esq.
 
   
Its: Principal Executive Officer
 
 

 
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SIGNIFICANT ACCOUNTING POLICIES Payables and Accruals [Abstract] 3. OTHER PAYABLES Related Party Transactions [Abstract] 4. DUE TO SHAREHOLDERS Equity [Abstract] 5. PREFERRED STOCK 6. COMMON STOCK 7. WARRANTS – RELATED PARTY Basis of Presentation Going Concern Cash and Cash Equivalents Concentrations of Credit Risk Use of Estimates Income Taxes Basic Net Loss per Share of Common Stock Financial Instruments Warrant Activity Warrants Related Party Details Number of Warrrants Outstanding, Beginning Number of Warrrants Expired/Retired Number of Warrrants Exercised Number of Warrrants Issued Number of Warrrants Outstanding, Ending Weighted Average Exercise Price Outstanding, Beginning Weighted Average Exercise Price Expired/Retired Weighted Average Exercise Price Exercised Weighted Average Exercise Price Issued Weighted Average Exercise Price Outstanding, Ending Significant Accounting Policies Details Narrative Uninsured deposits Amount common stock equivalents issued Other Payables Details Narrative Amount due prospective investors Due To Shareholders Details Narrative Cash advances provided by Dave Hunt Cash advances provided BCGU, LLC Repayment made by Company for cash advances Amount owed to shareholders Assets, Current Assets Liabilities, Current Stockholders' Equity Attributable to Parent Liabilities and Equity Operating Expenses Operating Income (Loss) Interest Expense Nonoperating Income (Expense) Net Income (Loss) Attributable to Parent Net Cash Provided by (Used in) Operating Activities Net Cash Provided by (Used in) Financing Activities Cash and Cash Equivalents, Period Increase (Decrease) Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures in Period Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price EX-101.PRE 7 ccon-20120630_pre.xml XML 8 report.css IDEA: XBRL DOCUMENT /* Updated 2009-11-04 */ /* v2.2.0.24 */ /* DefRef Styles */ ..report table.authRefData{ background-color: #def; border: 2px solid #2F4497; font-size: 1em; position: absolute; } ..report table.authRefData a { display: block; font-weight: bold; } ..report table.authRefData p { margin-top: 0px; } ..report table.authRefData .hide { background-color: #2F4497; padding: 1px 3px 0px 0px; text-align: right; } ..report table.authRefData .hide a:hover { background-color: #2F4497; } ..report table.authRefData .body { height: 150px; overflow: auto; width: 400px; } ..report table.authRefData table{ font-size: 1em; } /* Report Styles */ ..pl a, .pl a:visited { color: black; text-decoration: none; } /* table */ ..report { background-color: white; border: 2px solid #acf; clear: both; color: black; font: normal 8pt Helvetica, Arial, san-serif; margin-bottom: 2em; } ..report hr { border: 1px solid #acf; } /* Top labels */ ..report th { background-color: #acf; color: black; font-weight: bold; text-align: center; } ..report th.void { background-color: transparent; color: #000000; font: bold 10pt Helvetica, Arial, san-serif; text-align: left; } ..report .pl { text-align: left; vertical-align: top; white-space: normal; width: 200px; word-wrap: break-word; } ..report td.pl a.a { cursor: pointer; display: block; width: 200px; } ..report td.pl div.a { width: 200px; } ..report td.pl a:hover { background-color: #ffc; } /* Header rows... */ ..report tr.rh { background-color: #acf; color: black; font-weight: bold; } /* Calendars... */ ..report .rc { background-color: #f0f0f0; } /* Even rows... */ ..report .re, .report .reu { background-color: #def; } ..report .reu td { border-bottom: 1px solid black; } /* Odd rows... */ ..report .ro, .report .rou { background-color: white; } ..report .rou td { border-bottom: 1px solid black; } ..report .rou table td, .report .reu table td { border-bottom: 0px solid black; } /* styles for footnote marker */ ..report .fn { white-space: nowrap; } /* styles for numeric types */ ..report .num, .report .nump { text-align: right; white-space: nowrap; } ..report .nump { padding-left: 2em; } ..report .nump { padding: 0px 0.4em 0px 2em; } /* styles for text types */ ..report .text { text-align: left; white-space: normal; } ..report .text .big { margin-bottom: 1em; width: 17em; } ..report .text .more { display: none; } ..report .text .note { font-style: italic; font-weight: bold; } ..report .text .small { width: 10em; } ..report sup { font-style: italic; } ..report .outerFootnotes { font-size: 1em; } XML 9 R9.htm IDEA: XBRL DOCUMENT v2.4.0.6
5. PREFERRED STOCK
6 Months Ended
Jun. 30, 2012
Equity [Abstract]  
5. PREFERRED STOCK

At June 30, 2012 preferred stock of the Company consisted of: $0.001 par value: 1,000,000 shares authorized. 100,000 shares issued and outstanding


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4. DUE TO SHAREHOLDERS
6 Months Ended
Jun. 30, 2012
Related Party Transactions [Abstract]  
4. DUE TO SHAREHOLDERS

The Company received cash advances to pay outstanding payables in connection with our SEC reporting obligaitons and annual audit, from shareholders, Dave Hunt and BCGU, LLC in amounts of $2,667 and $5,333, respectively, during the six months ended June 30, 2012.  The Company made no payments to BCGU, LLC or Dave Hunt during the six months ended June 30, 2012, and $8,000 was due to these shareholders at June 30, 2012.


Dave Hunt is the managing member of RVCA, a principal owner of the Company and BCGU, LLC is a principal owner of the Company.


XML 13 R2.htm IDEA: XBRL DOCUMENT v2.4.0.6
CONDENSED BALANCE SHEETS (Unaudited) (USD $)
Jun. 30, 2012
Dec. 31, 2011
ASSETS    
Cash $ 966 $ 209,948
Total current assets 966 209,948
TOTAL ASSETS 966 209,948
LIABILITIES AND STOCKHOLDERS' DEFICIT    
Accounts payable 47,290 40,540
Other payables 1,660 209,977
Due to shareholders 8,000   
Total current liabilities 56,950 250,517
TOTAL LIABILITIES 56,950 250,517
STOCKHOLDERS' DEFICIT    
Preferred stock, 1,000,000 shares authorized, $0.001 par value 100,000 shares issued and outstanding 100 100
Common stock, 4,999,000,000 shares authorized, $0.001 par value 2,750,000 shares issued and outstanding 2,750 2,750
Additional paid-in capital 11,823,622 11,823,622
Deficit accumulated (11,882,456) (11,867,041)
TOTAL STOCKHOLDERS' DEFICIT (55,984) (40,569)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT $ 966 $ 209,948
XML 14 R6.htm IDEA: XBRL DOCUMENT v2.4.0.6
1. SIGNIFICANT ACCOUNTING POLICIES
6 Months Ended
Jun. 30, 2012
Accounting Policies [Abstract]  
1. SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation


The accompanying interim unaudited condensed financial statements have been prepared in accordance with  U.S/ generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In our opinion, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the six months ended June 30, 2012are not necessarily indicative of the results that may be expected for the year ending December 31, 2012. For further information, refer to the financial statements and footnotes thereto included in our Form 10-K Report for the fiscal year ended December 31, 2011.


Going Concern


The accompanying consolidated financial statements have been prepared on a going-concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred recurring operating losses, had negative operating cash flows and has not generated any significant revenues in recent fiscal years. In addition, the Company had a deficit accumulated during the development stage of approximately $11.9 million at June 30, 2012. These factors raise substantial doubt about the Company’s ability to continue as a going concern.


The Company’s continuation as a going concern is dependent on attaining profitable operations, restructuring its financial obligations, and obtaining additional outside financing.  The Company has funded losses from operations primarily from the issuance of debt, issuance of common stock and the sale of the Company’s common stock.  The Company believes that the issuance of debt and the sale of the Company’s common stock will continue to fund operating losses in the short-term until the Company can generate revenues sufficient to fund its operations.


Cash and Cash Equivalents


Cash equivalents include short-term, highly liquid investments with maturities of three months or less at the time of acquisition.


Concentrations of Credit Risk


A financial instrument which potentially subjects the Company to concentrations of credit risk is cash.  The Company places its cash with financial institutions deemed by management to be of high credit quality.  The Federal Deposit Insurance Corporation (“FDIC”) provides basic deposit coverage with limits to $250,000 per owner.  In addition to the basic insurance deposit coverage, the FDIC is providing temporary unlimited coverage for noninterest-bearing transaction accounts from December 31, 2010 to December 31, 2012.  At June 30, 2012, there were no uninsured deposits.


Use of Estimates


The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates. Estimates and assumptions principally relate to the fair value and forfeiture rates of stock based transactions, and long-lived asset depreciation and amortization, and potential impairment.


Income Taxes


Income tax expense is provided for the tax effects of transactions reported in the financial statements and consist of taxes currently due, plus deferred taxes.  Deferred taxes are recognized for differences between the basis of assets and liabilities for financial statement and income tax purposes.  The differences relate primarily to the effects of net operating loss carry forwards and differing basis, depreciation methods, and lives of depreciable assets. The deferred tax assets represent the future tax return consequences of those differences, which will be deductible when the assets are recovered.

 

No income tax benefit (expense) was recognized for the six months ended June 30, 2012 as a result of tax losses in this period and because deferred tax benefits, derived from the Company’s prior net operating losses, were previously fully reserved.  The Company had federal net operating loss carryforwards of approximately $12.0 million.The use of our net operating losses may be restricted in future years due to the limitations pursuant to IRC Section 382 on changes in ownership.


The Company currently has tax return periods open beginning with December 31, 2004 through December 31, 2010.


Basic Net Loss per Share of Common Stock


Basic net loss per common share is based on the weighted average number of shares outstanding during the periods presented.  Diluted earnings per share are computed using weighted average number of common shares plus dilutive common share equivalents outstanding during the period.  At June 30, 2012 there was no common stock equivalents issued.  


Financial Instruments


Fair value measurements are determined based on the assumptions that market participants would use in pricing an asset or liability.  ASC 820-10 establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. FASB ASC 820 establishes a fair value hierarchy that prioritizes the use of inputs used in valuation methodologies into the following three levels:


Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets. A quoted price in an active market provides the most reliable evidence of fair value and must be used to measure fair value whenever available.


Level 2: Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.


Level 3: Significant unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability. For example, level 3 inputs would relate to forecasts of future earnings and cash flows used in a discounted future cash flows method.


The recorded amounts of financial instruments, including cash equivalents accounts payable, other payables and due to shareholders, approximate their market values as of June 30, 2012 and December 31, 2011.


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XML 16 R7.htm IDEA: XBRL DOCUMENT v2.4.0.6
3. OTHER PAYABLES
6 Months Ended
Jun. 30, 2012
Payables and Accruals [Abstract]  
3. OTHER PAYABLES

The Company began capital raising efforts during the year ended December 31, 2011 to cover certain cash obligations regarding possible acquisition targets and other capital funding needs.  At December 31, 2011 we had raised $209,977 and have recorded these cash receipts as other payables on the Balance Sheets.  The Company is in the process of creating financing documentation (“Financing Offer”) related to these payables and once finalized will roll these amounts into a bridge promissory note and/or future share issuances that are consistent with our Financing Offer, of which the terms have not been finalized.  In March 2012, the Company determined it did not raise the required funds to close on our capital raising effort, and began returning amounts to the prospective investors on a pro-rata basis.At June 30, 2012, the Company had $1,660 due to these prospective investors.


 

 

 

XML 17 R3.htm IDEA: XBRL DOCUMENT v2.4.0.6
CONDENSED BALANCE SHEETS (Parenthetical) (USD $)
Jun. 30, 2012
Dec. 31, 2011
Statement of Financial Position [Abstract]    
Preferred Stock, par value $ 0.001 $ 0.001
Preferred Stock, shares authorized 1,000,000 1,000,000
Preferred Stock, shares issued 100,000 100,000
Preferred Stock, shares outstanding 100,000 100,000
Common Stock, par value $ 0.001 $ 0.001
Common Stock, shares authorized 4,999,000,000 4,999,000,000
Common Stock, shares issued 2,750,000 2,750,000
Common Stock, shares outstanding 2,750,000 2,750,000
XML 18 R17.htm IDEA: XBRL DOCUMENT v2.4.0.6
4. DUE TO SHAREHOLDERS (Details Narrative) (USD $)
6 Months Ended
Jun. 30, 2012
Dec. 31, 2011
Due To Shareholders Details Narrative    
Cash advances provided by Dave Hunt $ 2,667  
Cash advances provided BCGU, LLC 5,333  
Repayment made by Company for cash advances 0  
Amount owed to shareholders $ 8,000   
XML 19 R1.htm IDEA: XBRL DOCUMENT v2.4.0.6
Document and Entity Information
6 Months Ended
Jun. 30, 2012
Aug. 20, 2012
Document And Entity Information    
Entity Registrant Name COCONNECT INC  
Entity Central Index Key 0001088638  
Document Type 10-Q  
Document Period End Date Jun. 30, 2012  
Amendment Flag false  
Current Fiscal Year End Date --12-31  
Is Entity a Well-known Seasoned Issuer? No  
Is Entity a Voluntary Filer? No  
Is Entity's Reporting Status Current? Yes  
Entity Filer Category Smaller Reporting Company  
Entity Common Stock, Shares Outstanding   2,750,000
Document Fiscal Period Focus Q2  
Document Fiscal Year Focus 2012  
XML 20 R4.htm IDEA: XBRL DOCUMENT v2.4.0.6
CONDENSED STATEMENTS OF OPERATIONS (Unaudited) (USD $)
3 Months Ended 6 Months Ended
Jun. 30, 2012
Jun. 30, 2011
Jun. 30, 2012
Jun. 30, 2011
Expenses        
Professional fees $ 1,750 $ 1,500 $ 6,750 $ 5,500
General and administrative 8,170 464 8,665 1,172
Total operating expenses 9,920 1,964 15,415 6,672
Loss from operations (9,920) (1,964) (15,415) (6,672)
Other income (expense)        
Interest expense    (10,151)    (20,301)
Total other income (expense)    (10,151)    (20,301)
Net loss before income tax (9,920) (12,115) (15,415) (26,973)
Income tax            
NET LOSS $ (9,920) $ (12,115) $ (15,415) $ (26,973)
Basic and diluted loss per common share $ 0 $ (0.04) $ 0.00 $ (0.08)
Weighted average common shares outstanding 2,750,000 323,483 2,750,000 323,483
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1. SIGNIFICANT ACCOUNTING POLICIES (Policies)
6 Months Ended
Jun. 30, 2012
Accounting Policies [Abstract]  
Basis of Presentation

Basis of Presentation


The accompanying interim unaudited condensed financial statements have been prepared in accordance with  U.S/ generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In our opinion, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the six months ended June 30, 2012are not necessarily indicative of the results that may be expected for the year ending December 31, 2012. For further information, refer to the financial statements and footnotes thereto included in our Form 10-K Report for the fiscal year ended December 31, 2011.

Going Concern

Going Concern


The accompanying consolidated financial statements have been prepared on a going-concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred recurring operating losses, had negative operating cash flows and has not generated any significant revenues in recent fiscal years. In addition, the Company had a deficit accumulated during the development stage of approximately $11.9 million at June 30, 2012. These factors raise substantial doubt about the Company’s ability to continue as a going concern.


The Company’s continuation as a going concern is dependent on attaining profitable operations, restructuring its financial obligations, and obtaining additional outside financing.  The Company has funded losses from operations primarily from the issuance of debt, issuance of common stock and the sale of the Company’s common stock.  The Company believes that the issuance of debt and the sale of the Company’s common stock will continue to fund operating losses in the short-term until the Company can generate revenues sufficient to fund its operations.

Cash and Cash Equivalents

Cash and Cash Equivalents


Cash equivalents include short-term, highly liquid investments with maturities of three months or less at the time of acquisition.

Concentrations of Credit Risk

Concentrations of Credit Risk


A financial instrument which potentially subjects the Company to concentrations of credit risk is cash.  The Company places its cash with financial institutions deemed by management to be of high credit quality.  The Federal Deposit Insurance Corporation (“FDIC”) provides basic deposit coverage with limits to $250,000 per owner.  In addition to the basic insurance deposit coverage, the FDIC is providing temporary unlimited coverage for noninterest-bearing transaction accounts from December 31, 2010 to December 31, 2012.  At June 30, 2012, there were no uninsured deposits.

Use of Estimates

Use of Estimates


The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates. Estimates and assumptions principally relate to the fair value and forfeiture rates of stock based transactions, and long-lived asset depreciation and amortization, and potential impairment.

Income Taxes

Income Taxes


Income tax expense is provided for the tax effects of transactions reported in the financial statements and consist of taxes currently due, plus deferred taxes.  Deferred taxes are recognized for differences between the basis of assets and liabilities for financial statement and income tax purposes.  The differences relate primarily to the effects of net operating loss carry forwards and differing basis, depreciation methods, and lives of depreciable assets. The deferred tax assets represent the future tax return consequences of those differences, which will be deductible when the assets are recovered.

 

No income tax benefit (expense) was recognized for the six months ended June 30, 2012 as a result of tax losses in this period and because deferred tax benefits, derived from the Company’s prior net operating losses, were previously fully reserved.  The Company had federal net operating loss carryforwards of approximately $12.0 million.The use of our net operating losses may be restricted in future years due to the limitations pursuant to IRC Section 382 on changes in ownership.


The Company currently has tax return periods open beginning with December 31, 2004 through December 31, 2010.

Basic Net Loss per Share of Common Stock

Basic Net Loss per Share of Common Stock


Basic net loss per common share is based on the weighted average number of shares outstanding during the periods presented.  Diluted earnings per share are computed using weighted average number of common shares plus dilutive common share equivalents outstanding during the period.  At June 30, 2012 there was no common stock equivalents issued.  

Financial Instruments

Financial Instruments


Fair value measurements are determined based on the assumptions that market participants would use in pricing an asset or liability.  ASC 820-10 establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. FASB ASC 820 establishes a fair value hierarchy that prioritizes the use of inputs used in valuation methodologies into the following three levels:


Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets. A quoted price in an active market provides the most reliable evidence of fair value and must be used to measure fair value whenever available.


Level 2: Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.


Level 3: Significant unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability. For example, level 3 inputs would relate to forecasts of future earnings and cash flows used in a discounted future cash flows method.


The recorded amounts of financial instruments, including cash equivalents accounts payable, other payables and due to shareholders, approximate their market values as of June 30, 2012 and December 31, 2011.

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7. WARRANTS RELATED PARTY
6 Months Ended
Jun. 30, 2012
Equity [Abstract]  
7. WARRANTS – RELATED PARTY

65,000 warrants were issued to Brad Bingham, our director, and 15,000 warrants were issued to Dave Hunt, the managing member of RVCA, a principal owner of the Company, during the year ended December 31, 2011, for services provided.  The warrants were valued using a Black-Scholes valuation model.  The variables used in this option-pricing model included: (1) discount rates of .24% (2) expected warrant life is two years, (3) expected volatility of 345% and (4) zero expected dividends.  These warrants expire on December 19, 2013.


A summary of the activity of the warrants for the six months ended June 30, 2012 is as follows:


 

          Weighted Average  
    Amount     Exercise Price  
Outstanding December 31, 2010     -     $ -  
Expired/Retired     -       -  
Exercised     -       -  
Issued     80,000       0.50  
Outstanding December 31, 2011     80,000     $ 0.50  
Expired/Retired     -       -  
Exercised     -       -  
Issued     -       -  
Outstanding June 30, 2012     80,000     $ 0.50  


XML 23 R15.htm IDEA: XBRL DOCUMENT v2.4.0.6
1. SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) (USD $)
Jun. 30, 2012
Significant Accounting Policies Details Narrative  
Uninsured deposits $ 0
Amount common stock equivalents issued 0
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7. WARRANTS RELATED PARTY (Tables)
6 Months Ended
Jun. 30, 2012
Equity [Abstract]  
Warrant Activity
          Weighted Average  
    Amount     Exercise Price  
Outstanding December 31, 2010     -     $ -  
Expired/Retired     -       -  
Exercised     -       -  
Issued     80,000       0.50  
Outstanding December 31, 2011     80,000     $ 0.50  
Expired/Retired     -       -  
Exercised     -       -  
Issued     -       -  
Outstanding June 30, 2012     80,000     $ 0.50  
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7. WARRANTS RELATED PARTY (Details) (USD $)
6 Months Ended 12 Months Ended
Jun. 30, 2012
Dec. 31, 2011
Warrants Related Party Details    
Number of Warrrants Outstanding, Beginning 80,000   
Number of Warrrants Expired/Retired      
Number of Warrrants Exercised      
Number of Warrrants Issued    80,000
Number of Warrrants Outstanding, Ending 80,000 80,000
Weighted Average Exercise Price Outstanding, Beginning $ 0.50   
Weighted Average Exercise Price Expired/Retired      
Weighted Average Exercise Price Exercised      
Weighted Average Exercise Price Issued    $ 0.50
Weighted Average Exercise Price Outstanding, Ending $ 0.50 $ 0.50
XML 26 R16.htm IDEA: XBRL DOCUMENT v2.4.0.6
3. OTHER PAYABLES (Details Narrative) (USD $)
Jun. 30, 2012
Other Payables Details Narrative  
Amount due prospective investors $ 1,660
XML 27 R5.htm IDEA: XBRL DOCUMENT v2.4.0.6
CONDENSED STATEMENTS OF CASH FLOWS (Unaudited) (USD $)
6 Months Ended
Jun. 30, 2012
Jun. 30, 2011
CASH FLOWS FROM OPERATING ACTIVITIES    
Net Loss $ (15,415) $ (26,973)
Changes in operating assets and liabilities:    
Accounts payable increase 6,750 599
Accrued expenses and interest increase    20,302
NET CASH USED IN OPERATING ACTIVITIES (8,665) (6,072)
CASH FLOWS FROM INVESTING ACTIVITIES    
NET CASH FROM INVESTING ACTIVITIES      
CASH FLOWS FROM FINANCING ACTIVITIES    
Proceeds from shareholder cash advances 8,000  
Proceeds and payments from cash advances (208,317)   
NET CASH FROM FINANCING ACTIVITIES (200,317)   
NET CHANGE IN CASH (208,982) (6,072)
CASH BALANCES    
Beginning of period 209,948 6,578
End of period 966 506
SUPPLEMENTAL DISCLOSURE:    
Interest paid      
Income taxes paid      
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6. COMMON STOCK
6 Months Ended
Jun. 30, 2012
Equity [Abstract]  
6. COMMON STOCK

At June 30, 2012 common stock of the Company consisted of: $0.001 par value: 4,999,000,000 shares authorized and 2,750,000 shares issued and outstanding.


On January 20, 2012, the Company issued 100,000 shares of common stock to a law firm for professional services provided, valued at $61,000.  Services by the law firm were never performed, as a result these shares were subsequently returned to the Company and retired in its treasury and no expense was recorded.  


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