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Description of Business
12 Months Ended
Dec. 31, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Description of Business

NOTE 1 – DESCRIPTION OF BUSINESS

 

KinerjaPay Corp. (the “Company”) is a Delaware corporation, was incorporated under the laws of the State of Delaware on February 12, 2010 as Solarflex Corp. On December 1, 2015, the Company entered into a license agreement with P.T. Kinerja Indonesia (“P.T. Kinerja” the “Licensor”), an entity organized under the laws of Indonesia and controlled by Mr. Edwin Ng, our chairman, CEO and control stockholder, for an exclusive, world- wide license to use and commercially exploit certain technology and intellectual property and its website, KinerjaPay.com. Pursuant to the License Agreement, the Company, as Licensee, was granted the exclusive, world-wide rights to the KinerjaPay IP, an e-commerce platform that provides users with the convenience of e-wallet service for bill transfer and online shopping and is among the first portals to allow users the convenience to top-up phone credit. In conjunction with this agreement, the Company changed its name from Solarflex Corp. to KinerjaPay Corp. On April 6, 2016, P.T. Kinerja Pay Indonesia, a wholly-owned subsidiary of the Company, was organized under the laws of Indonesia.

 

On August 31, 2018, the Company completed its acquisition of its licensor P.T. Kinerja which became a wholly-owned subsidiary of the Company (Note 3). The result of this acquisition enabled the Company to present its revenue on a gross basis as the principal going forward. Upon the closing of the acquisition of the Licensor by the Licensee, the License Agreement effectively ceased. In addition, the acquisition gave the Company the ability to consolidate its IP technology and manage its 1,500 square-feet data center located in North Sumatra which the Company plans to expand to provide cloud computing services as well as data mining from the Company’s existing customer base. The Company believes that the acquisition will make the Company more cost efficient and potentially generate more revenues from other IT services.

 

On September 13, 2018, the Company incorporated P.T. Kinerja Simpan Pinjam, a new wholly-owned subsidiary, for the purpose of managing its KFUND brand as a peer-to-peer (P2P) lending platform focusing on micro-lending activities. The Company plans to develop the KFUND brand mainly targeting the consumer sector to facilitate micro loans ranging from $100 to $1,000 on biweekly or monthly term. KFUND is still in preparation stage but the Company expects to start operations of KFUND as its cash flow improves, in or about the first half of 2021.

 

As one of Indonesia’s fintech P2P lending companies, P.T. Kinerja SP is subject to supervision by the Financial Service Authority (Otoritas Jasa Keuangan – “OJK”) of Indonesia. OJK requested PT KSP to change its company name to comply with a recently issued regulation that states that a P2P company may not have the word “simpan” (meaning to save or to deposit) in its name because it is not allowed to deposit funds but is expected to channel funds by bringing together lenders and borrowers. Based on this requirement, the Company changed its name to PT Kinerja Sukses Gemilang (“PT Kinerja SG”), on August 30, 2019.

 

On February 28, 2019, Kinerja Pay Ltd. a wholly-owned subsidiary of P.T. Kinerja, was incorporated in Nevada. The subsidiary has no employees or operations, aside from a bank account to receive cash proceeds from security purchase agreements and convertible debentures, which is then transferred to the Parent company or other subsidiaries.

 

Going Concern

 

The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which contemplate continuation of the Company as a going concern. The Company has not established sufficient revenue to cover its operating costs, and as such, has incurred an operating loss since inception. For the year ended December 31, 2019, the Company had a net loss of approximately $19,948,000. At December 31, 2019, the Company had an accumulated deficit of approximately $38,093,000 and a working capital deficit of approximately $6,259,000. These factors raise substantial doubt about the Company’s ability to continue as a going concern, within one year from the issuance date of this filing. The Company’s ability to continue as a going concern is dependent on its ability to raise the required additional capital or debt financing to meet short and long-term operating requirements. During the year ended December 31, 2019, the Company received net cash proceeds of approximately $4,344,000 from the issuance of new convertible debentures. Subsequent to December 31, 2019, the Company received approximately $496,000 from the issuance of new convertible debentures. Additional financing may not be available upon acceptable terms, or at all. If adequate funds are not available or are not available on acceptable terms, the Company may not be able to take advantage of prospective business endeavors or opportunities, which could significantly and materially restrict our operations. The Company continues to pursue external financing alternatives to improve its working capital position. The accompanying financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the possible inability of the Company to continue as a going concern.

 

COVID-19 Pandemic

 

In December 2019, an outbreak of a novel strain of coronavirus originated in Wuhan, China (“COVID-19”) and has since spread worldwide, including to the Unites States as well as Indonesia, posing public health risks that have reached pandemic proportions (the “COVID-19 Pandemic”). The COVID-19 Pandemic poses a threat to the health and economic well-being of the Company’s employees, customers, and vendors. The Company’s business operations, that of its operating subsidiaries and their operating offices and primary banking relationships, as well as its chief executive officer, chief financial officer and key operating personnel, are all located in Indonesia. Like most businesses world-wide, the COVID-19 Pandemic has impacted the Company financially; however, management cannot presently predict the scope and severity with which COVID-19 will impact our business, financial condition, results of operations and cash flow. The ultimate impact of the COVID-19 pandemic on the Company’s operations is unknown and will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the duration of the COVID-19 outbreak, new information which may emerge concerning the severity of the COVID-19 pandemic, and any additional preventative and protective actions that governments, or the Company, may direct, which may result in an extended period of continued business disruption, and reduced operations.

 

Principles of Consolidation

 

The financial statements include the accounts of KinerjaPay Corp. and its wholly owned subsidiaries P.T. KinerjaPay, P.T. Kinerja, and P.T. Kinerja Sukses Gemilang and Kinerja Pay Ltd. All significant inter-company balances and transactions have been eliminated.