SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[x] Quarterly Report Pursuant to Section 13 or 15(d) Securities Exchange Act of 1934 for Quarterly Period Ended September 30, 2013
-OR-
[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities And Exchange Act of 1934 for the transaction period from _________ to________
Commission File Number 333-169732
Original Source Entertainment, Inc.
(Exact name of Registrant in its charter)
Nevada |
| 27-0863354 |
(State or Other Jurisdiction of Incorporation or Organization) |
| (I.R.S. Employer Identification Number) |
8201 South Santa Fe Drive #229, Littleton, CO |
| 80120 |
(Address of Principal Executive Offices |
| (Zip Code) |
Registrant's Telephone Number, Including Area Code: |
| (303) 495-3728 |
Indicate by check mark whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 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 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 for such shorter period that the registrant was required to submit and post such files). Yes [ ] No [ ]
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerate filer, or a small reporting company as defined by Rule 12b-2 of the Exchange Act):
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Large accelerated filer [ ] |
| Non-accelerated filer [ ] |
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 [ ] No [x]
The number of outstanding shares of the registrant's common stock, November 14, 2013: Common Stock 6,573,000
2
ORIGINAL SOURCE ENTERTAINMENT, INC.
FORM 10-Q
INDEX
PART 1 FINANCIAL INFORMATION
|
| Page |
Item 1. Financial Statements (Unaudited) |
| 4 |
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations |
| 10 |
Item 3. Quantitative and Qualitative Disclosure About Market Risk |
| 12 |
Item 4. Controls and Procedures |
| 13 |
PART II - OTHER INFORMATION
Item 1. Legal Proceedings |
| 14 |
Item 1A. Risk Factors |
| 14 |
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds |
| 14 |
Item 3. Defaults Upon Senior Securities |
| 14 |
Item 4. Mine Safety Disclosures |
| 14 |
Item 5. Other Information |
| 14 |
Item 6. Exhibits |
| 14 |
|
|
|
SIGNATURES |
| 15 |
3
Original Source Entertainment, Inc.
(A Development Stage Company)
Consolidated Balance Sheets
| Dec. 31, | Sept. 30, 2013 |
| 2012 | (Unaudited) |
ASSETS |
|
|
|
|
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Current assets |
|
|
Cash | $ 1,118 | $ 608 |
Total current assets | 1,118 | 608 |
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Total Assets | $ 1,118 | $ 608 |
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|
LIABILITIES & STOCKHOLDERS' EQUITY |
| |
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|
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Current liabilities |
|
|
Related party payables | $ 952 | $ 952 |
Accrued interest payable | 403 | 1,454 |
Notes payable - current | 17,000 | 26,500 |
Total current liabilities | 18,355 | 28,906 |
|
|
|
Notes payable | - | - |
|
|
|
Total Liabilities | 18,355 | 28,906 |
|
|
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Stockholders' Equity |
|
|
Preferred stock, $.001 par value; |
|
|
5,000,000 shares authorized; |
|
|
none issued and outstanding |
|
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Common stock, $.001 par value; | - | - |
45,000,000 shares authorized; |
|
|
6,573,000 shares issued and outstanding | 5,073 | 5,073 |
Additional paid in capital | 28,077 | 44,577 |
Deficit accumulated during the dev. stage | (50,387) | (77,948) |
|
|
|
Total Stockholders' Equity | (17,237) | (28,298) |
|
|
|
Total Liabilities and Stockholders' Equity | $ 1,118 | $ 608 |
The accompanying notes are an integral part of the consolidated financial statements.
4
Original Source Entertainment, Inc.
(A Development Stage Company)
Consolidated Statements of Operations
|
|
|
|
| Aug. 20, 2009 |
| Three Months | Three Months | Nine Months | Nine Months | (Inception) |
| Ended | Ended | Ended | Ended | Through |
| Sept. 30, 2012 | Sept. 30, 2013 | Sept. 30, 2012 | Sept. 30, 2013 | Sept. 30, 2013 |
|
|
|
|
|
|
Royalty revenue | $ 23 | $ 252 | $ 561 | $ 1,109 | $ 8,993 |
Cost of sales | - | - | - | - | 2,138 |
Gross profit | 23 | 252 | 561 | 1,109 | 6,855 |
|
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Operating expenses: |
|
|
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General and administrative | 4,754 | 4,982 | 12,927 | 23,619 | 79,349 |
| 4,754 | 4,982 | 12,927 | 23,619 | 79,349 |
|
|
|
|
|
|
Gain (loss) from operations | (4,731) | (4,730) | (12,366) | (22,510) | (72,494) |
|
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Other income (expense): |
|
|
|
|
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Interest expense | (49) | (401) | (169) | (1,051) | (1,454) |
Interest expense - beneficial conversion feature | - | - | - | (4,000) | (4,000) |
| (49) | (401) | (169) | (5,051) | (5,454) |
|
|
|
|
|
|
Income (loss) before provision for income taxes | (4,780) | (5,131) | (12,535) | (27,561) | (77,948) |
|
|
|
|
|
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Provision for income tax | - | - | - | - | - |
|
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|
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Net income (loss) | $ (4,780) | $(5,131) | $(12,535) | $(27,561) | $(77,948) |
|
|
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Net income (loss) per share |
|
|
|
|
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(Basic and fully diluted) | (0.00) | (0.00) | (0.00) | (0.01) |
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Weighted average number of |
|
|
|
|
|
common shares outstanding | 4,500,000 | 4,500,000 | 4,500,000 | 4,500,000 |
|
The accompanying notes are an integral part of the consolidated financial statements.
5
Original Source Entertainment, Inc.
(A Development Stage Company)
Consolidated Statements of Cash Flows
(Unaudited)
|
|
| Aug. 20, 2009 |
| Nine Months | Nine Months | (Inception) |
| Ended | Ended | Through |
| Sept. 30, 2012 | Sept. 30, 2013 | Sept. 30, 2013 |
|
|
|
|
Cash Flows From Operating Activities: |
|
|
|
Net income (loss) during the development stage | $(12,535) | $(27,561) | $(77,948) |
|
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Adjustments to reconcile net loss to |
|
|
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net cash provided by (used for) |
|
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operating activities: |
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Related party payables | - | - | 952 |
Accrued payables | 169 | 1,051 | 1,454 |
Interest expense - beneficial conversion feature | - | 4,000 | 4,000 |
Compensatory stock issuances | - | - | 3,000 |
|
|
|
|
Net cash provided by (used for) |
|
|
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operating activities | (12,366) | (22,510) | (68,542) |
|
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Cash Flows From Investing Activities: |
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|
|
| - | - | - |
Net cash provided by (used for) |
|
|
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investing activities | - | - | - |
(Continued on next page)
6
Original Source Entertainment, Inc.
(A Development Stage Company)
Consolidated Statements of Cash Flows
(Unaudited)
|
|
| Aug. 20, 2009 |
| Nine Months | Nine Months | (Inception) |
| Ended | Ended | Through |
| Sept. 30, 2012 | Sept. 30, 2013 | Sept. 30, 2013 |
|
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|
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Cash Flows From Financing Activities: |
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Notes payable - borrowings | - | 9,500 | 26,500 |
Paid in capital | - | 12,500 | 12,500 |
Sale of common stock | - | - | 30,150 |
Net cash provided by (used for) |
|
|
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financing activities | - | 22,000 | 69,150 |
|
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Net Increase (Decrease) In Cash | (12,366) | (510) | 608 |
|
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Cash At The Beginning Of The Period | 13,851 | 1,118 | - |
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Cash At The End Of The Period | $ 1,485 | $ 608 | $ 608 |
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Schedule Of Non-Cash Investing And Financing Activities |
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The Company in 2013 recorded $4,000 in paid in capital from a beneficial conversion feature on notes payable. | |||
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Supplemental Disclosure |
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Cash paid for interest | $ - | $ - | $ - |
Cash paid for income taxes | $ - | $ - | $ - |
The accompanying notes are an integral part of the consolidated financial statements.
7
ORIGINAL SOURCE ENTERTAINMENT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Original Source Entertainment, Inc. (the Company), was incorporated in the State of Nevada on August 20, 2009. The Company plans to license songs to the television and music industry for use in television shows or movies.
Basis of Presentation
The accompanying unaudited financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and disclosures required by generally accepted accounting principles for complete financial statements. All adjustments which are, in the opinion of management, necessary for a fair presentation of the results of operations for the interim periods have been made and are of a recurring nature unless otherwise disclosed herein. The results of operations for such interim periods are not necessarily indicative of operations for a full year.
Principles of consolidation
The accompanying consolidated financial statements include the accounts of Original Source Entertainment, Inc. and its wholly owned subsidiary. All intercompany accounts and transactions have been eliminated in consolidation.
Cash and cash equivalents
The Company considers all highly liquid investments with an original maturity of three months or less as cash equivalents.
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect 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.
Net income (loss) per share
The net income (loss) per share is computed by dividing the net income (loss) by the weighted average number of shares of common outstanding. Warrants, stock options, and common stock issuable upon the conversion of the Company's preferred stock (if any),
8
are not included in the computation if the effect would be anti-dilutive and would increase the earnings or decrease loss per share.
Income tax
The Company accounts for income taxes pursuant to ASC 740. Under ASC 740 deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss carryforwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.
Revenue recognition
Revenue is recognized on an accrual basis after services have been performed under contract terms, the service price to the client is fixed or determinable, and collectability is reasonably assured.
Property and equipment
Property and equipment are recorded at cost and depreciated under the straight line method over each item's estimated useful life.
Financial Instruments
The carrying value of the Companys financial instruments, as reported in the accompanying balance sheet, approximates fair value.
Stock based compensation
The Company accounts for employee and non-employee stock awards under ASC 718, whereby equity instruments issued to employees for services are recorded based on the fair value of the instrument issued and those issued to non-employees are recorded based on the fair value of the consideration received or the fair value of the equity instrument, whichever is more reliably measurable.
9
Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
Forward-looking Statements
Statements in this Managements Discussion and Analysis of Financial Condition and Results of Operation, as well as in certain other parts of this quarterly report on Form
10-Q (as well as information included in oral statements or other written statements made or to be made by Original Source) that look forward in time, are forward-looking statements made pursuant to the safe harbor provisions of the Private Litigation Reform Act of 1995. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, expectations, predictions, and assumptions and other statements which are other than statements of historical facts. Although Original Source believes such forward-looking statements are reasonable, it can give no assurance that any forward-looking statements will prove to be correct. Such forward-looking statements are subject to, and are qualified by, known and unknown risks, uncertainties and other factors that could cause actual results, performance or achievements to differ materially from those expressed or implied by those statements. These risks, uncertainties and other factors include, but are not limited to Original Sources ability to estimate the impact of competition and of industry consolidation and risks, uncertainties and other factors set forth in Original Sources filings with the Securities and Exchange Commission, including without limitation to this Annual Report on Form 10-Q.
Original Source undertakes no obligation to update forward-looking statements to reflect events or circumstances occurring after the date of this Form 10-Q.
Critical Accounting Policies
The following discussion as well as disclosures included elsewhere in this Form 10-Q are based upon our unaudited financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. These financial statements and accompanying notes have been prepared in accordance with accounting principles generally accepted in the United States of America.
The preparation of these financial statements requires management to make estimates, judgments and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosures of contingencies. Original Source continually evaluates the accounting policies and estimates used to prepare the financial statements. Original Source bases its estimates on historical experiences and assumptions believed to be reasonable under current facts and circumstances. Actual amounts and results could differ from these estimates made by management.
10
Trends and Uncertainties
There are no material commitments for capital expenditure at this time. There are no trends, events or uncertainties that have had or are reasonably expected to have a material impact on our limited operations. There are no known causes for any material changes from period to period in one or more line items of Original Sources financial statements.
Liquidity and Capital Resources
At September 30, 2013, Original Source had a cash balance of $608, which represents a $510 decrease from the $1,118 balance at December 31, 2012. The decrease was primarily the result of decreased revenues for the nine months ended September 30, 2013.
For the nine months ended September 30, 2013 and 2012, we did not pursue any investing activities.
For the nine months ended September 30, 2012, we did not pursue any financing activities.
For the nine months ended September 30, 2013, we received $9,500 from notes payable borrowings and $12,500 from paid in capital. As a result, we had net cash provided by financing activities of $22,000 for the nine months ended September 30, 2013.
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As shown in the accompanying financial statements, Original Source has incurred losses of $27,561 and $12,535 for the nine months ended September 30, 2013 and 2012, respectively, and a working capital deficiency which raises substantial doubt about the Companys ability to continue as a going concern.
Management believes the Company will continue to incur losses and negative cash flows from operating activities for the foreseeable future and will need additional equity or debt financing to sustain its operations until it can achieve profitability and positive cash flows, if ever. Management plans to seek additional debt and/or equity financing for the Company, but cannot assure that such financing will be available on acceptable terms.
The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty. There can be no assurance that management will be successful in implementing its business plan or that the successful implementation of such business plan will actually improve Original Sources operating results.
Results of Operations
For the three months ended September 30, 2013, we earned revenues of $252. We paid general and administrative expenses of $4,982, and interest expenses of $401. As a result, we had a net loss of $5,131 for the three months ended September 30, 2013.
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For the three months ended September 30, 2012, we earned revenues of $23. We had general and administrative expenses of $4,754 and interest expenses of $49. As a result, we had a net loss of $4,780 for the three months ended September 30, 2012.
The $351 increase in net loss for the three months ended September 30, 2013 compared to the three months ended September 30, 2012 is primarily the result of increased general and administrative expenses and increased interest expenses. Our $229 increase in revenue for the three months ended September 30, 2013 does not adequately counteract the losses from our increased general and administrative expenses and our increased interest expense.
For the nine months ended September 30, 2013, we earned revenues of $1,109. We paid general and administrative expenses of $23,619, interest expenses of $1,051, and interest expense beneficial conversion features of $4,000. As a result, we had a net income of $27,561 for the nine months ended September 30, 2013.
Comparatively, for the nine months ended September 30, 2012, we earned revenues of $561. We paid general and administrative expenses of $12,927 and interest expenses of $169. As a result, we had a net loss of $12,535 for the nine months ended September 30, 2012.
The $10,692 difference in general and administrative expenses was due to the increased cost of our application and approval for DTC eligibility during the nine months ended September 30, 2013.
Recently Issued Accounting Standards
Management does not believe that any other recently issued, but not yet effective, accounting standard if currently adopted would have a material effect on the accompanying financial statements.
Off Balance Sheet Arrangements
None.
Disclosure of Contractual Obligations
None.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Not applicable for smaller reporting companies.
12
12
Item 4. Controls and Procedures
During the three months ended September 30, 2013, there were no changes in our internal controls over financial reporting (as defined in Rule 13a- 15(f) and 15d-15(f) under the Exchange Act) that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Evaluation of Disclosure Controls and Procedures
Under the supervision and with the participation of our management, including our chief executive officer and principal financial officer, we conducted an evaluation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) and Rule 15d-15(e) promulgated under the Securities Exchange Act of 1934, as amended, as of September 30, 2013. Based on this evaluation, our chief executive officer and principal financial officers have concluded such controls and procedures to be effective as of September 30, 2013 to ensure that information required to be disclosed by the issuer in the reports that it files or submits under the Act is recorded, processed, summarized and reported, within the time periods specified in the Commission's rules and forms and to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Act is accumulated and communicated to the issuer's management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
13
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 1A. Risk Factors
Not applicable for smaller reporting companies
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
None
Item 3. Defaults Upon Senior Securities.
None
Item 4. Mine Safety Disclosures
Not applicable
Item 5. Other Information
None
Item 6. Exhibits
Exhibit 31* - Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Exhibit 32* - Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
Exhibit 101.INS** XBRL Instance Document
Exhibit 101.SCH** XBRL Taxonomy Extension Schema Document
Exhibit 101.CAL** XBRL Taxonomy Extension Calculation Linkbase Document
Exhibit 101.DEF** XBRL Taxonomy Extension Definition Linkbase Document
Exhibit 101.LAB** XBRL Taxonomy Extension Label Linkbase Document
Exhibit 101.PRE** XBRL Taxonomy Extension Presentation Linkbase Document
* Filed herewith
**XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.
14
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized.
Dated: November 14, 2013
ORIGINAL SOURCE ENTERTAINMENT, INC.
By: /s/Lecia L. Walker
Lecia L. Walker
Chief Executive Officer
Principal Financial Officer
15
302 CERTIFICATION
I, Lecia Walker, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Original Source Entertainment, Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under my supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report, our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d) Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and
5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):
a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls over financial reporting.
Date: November 14, 2013
/s/Lecia L. Walker
Lecia L. Walker
Chief Executive Officer
Principal Financial Officer
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Original Source Entertainment, Inc. (the "Company") on Form 10-Q for the quarter ended September 30, 2013 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Lecia L. Walker, Chief Executive Officer and Principal Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.
/s/Lecia L. Walker
Lecia L. Walker
Chief Executive Officer
Principal Financial Officer
November 14, 2013
Note 1. Organization, Operations and Summary of Significant Accounting Policies: Net Income (loss) Per Share (Policies)
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9 Months Ended |
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Sep. 30, 2013
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Policies | |
Net Income (loss) Per Share | Net income (loss) per share
The net income (loss) per share is computed by dividing the net income (loss) by the weighted average number of shares of common outstanding. Warrants, stock options, and common stock issuable upon the conversion of the Company's preferred stock (if any), are not included in the computation if the effect would be anti-dilutive and would increase the earnings or decrease loss per share. |
Note 1. Organization, Operations and Summary of Significant Accounting Policies: Business description and basis of presentation (Policies)
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9 Months Ended |
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Sep. 30, 2013
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Policies | |
Business description and basis of presentation | Original Source Entertainment, Inc. (the Company), was incorporated in the State of Nevada on August 20, 2009. The Company plans to license songs to the television and music industry for use in television shows or movies.
Basis of Presentation
The accompanying unaudited financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and disclosures required by generally accepted accounting principles for complete financial statements. All adjustments which are, in the opinion of management, necessary for a fair presentation of the results of operations for the interim periods have been made and are of a recurring nature unless otherwise disclosed herein. The results of operations for such interim periods are not necessarily indicative of operations for a full year. |
Note 1. Organization, Operations and Summary of Significant Accounting Policies: Cash and Cash Equivalents (Policies)
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9 Months Ended |
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Sep. 30, 2013
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Policies | |
Cash and Cash Equivalents | Cash and cash equivalents
The Company considers all highly liquid investments with an original maturity of three months or less as cash equivalents. |
Note 1. Organization, Operations and Summary of Significant Accounting Policies: Income Tax (Policies)
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9 Months Ended |
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Sep. 30, 2013
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Policies | |
Income Tax | Income tax
The Company accounts for income taxes pursuant to ASC 740. Under ASC 740 deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss carryforwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. |
Note 1. Organization, Operations and Summary of Significant Accounting Policies: Use of Estimates (Policies)
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9 Months Ended |
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Sep. 30, 2013
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Policies | |
Use of Estimates | Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect 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. |
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Original Source Entertainment, Inc. (A Development Stage Company) - Consolidated Statements of Operations (Unaudited) (USD $)
|
3 Months Ended | 9 Months Ended | 49 Months Ended | ||
---|---|---|---|---|---|
Sep. 30, 2013
|
Sep. 30, 2012
|
Sep. 30, 2013
|
Sep. 30, 2012
|
Sep. 30, 2013
|
|
Royalty revenue | $ 252 | $ 23 | $ 1,109 | $ 561 | $ 8,993 |
Cost of sales | 0 | 0 | 0 | 0 | 2,138 |
Gross profit | 252 | 23 | 1,109 | 561 | 6,855 |
Operating Expenses: | |||||
General and administrative | 4,982 | 4,754 | 23,619 | 12,927 | 79,349 |
Total operating expenses | 4,982 | 4,754 | 23,619 | 12,927 | 79,349 |
Gain (loss) from operations | (4,730) | (4,731) | (22,510) | (12,366) | (72,494) |
Other income (expense): | |||||
Interest expense | (401) | (49) | (1,051) | (169) | (1,454) |
Interest expense - beneficial conversion feature | 0 | 0 | (4,000) | 0 | (4,000) |
Total other income (expense) | (401) | (49) | (5,051) | (169) | (5,454) |
Income (loss) before provision for income taxes | (5,131) | (4,780) | (27,561) | (12,535) | (77,948) |
Provision for income tax | 0 | 0 | 0 | 0 | 0 |
Net Income (loss) | $ (5,131) | $ (4,780) | $ (27,561) | $ (12,535) | $ (77,948) |
Net income (loss) per share (Basic and fully diluted) | $ 0 | $ 0 | $ 0 | $ 0 | |
Weighted Average Number of Common Shares Outstanding | 4,500,000 | 4,500,000 | 4,500,000 | 4,500,000 |
Note 1. Organization, Operations and Summary of Significant Accounting Policies: Financial Instruments (Policies)
|
9 Months Ended |
---|---|
Sep. 30, 2013
|
|
Policies | |
Financial Instruments | Financial Instruments
The carrying value of the Companys financial instruments, as reported in the accompanying balance sheet, approximates fair value. |
Note 1. Organization, Operations and Summary of Significant Accounting Policies
|
9 Months Ended |
---|---|
Sep. 30, 2013
|
|
Notes | |
Note 1. Organization, Operations and Summary of Significant Accounting Policies: | NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Original Source Entertainment, Inc. (the Company), was incorporated in the State of Nevada on August 20, 2009. The Company plans to license songs to the television and music industry for use in television shows or movies.
Basis of Presentation
The accompanying unaudited financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and disclosures required by generally accepted accounting principles for complete financial statements. All adjustments which are, in the opinion of management, necessary for a fair presentation of the results of operations for the interim periods have been made and are of a recurring nature unless otherwise disclosed herein. The results of operations for such interim periods are not necessarily indicative of operations for a full year.
Principles of consolidation
The accompanying consolidated financial statements include the accounts of Original Source Entertainment, Inc. and its wholly owned subsidiary. All intercompany accounts and transactions have been eliminated in consolidation.
Cash and cash equivalents
The Company considers all highly liquid investments with an original maturity of three months or less as cash equivalents.
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect 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.
Net income (loss) per share
The net income (loss) per share is computed by dividing the net income (loss) by the weighted average number of shares of common outstanding. Warrants, stock options, and common stock issuable upon the conversion of the Company's preferred stock (if any), are not included in the computation if the effect would be anti-dilutive and would increase the earnings or decrease loss per share.
Income tax
The Company accounts for income taxes pursuant to ASC 740. Under ASC 740 deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss carryforwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.
Revenue recognition
Revenue is recognized on an accrual basis after services have been performed under contract terms, the service price to the client is fixed or determinable, and collectability is reasonably assured.
Property and equipment
Property and equipment are recorded at cost and depreciated under the straight line method over each item's estimated useful life.
Financial Instruments
The carrying value of the Companys financial instruments, as reported in the accompanying balance sheet, approximates fair value.
Stock based compensation
The Company accounts for employee and non-employee stock awards under ASC 718, whereby equity instruments issued to employees for services are recorded based on the fair value of the instrument issued and those issued to non-employees are recorded based on the fair value of the consideration received or the fair value of the equity instrument, whichever is more reliably measurable. |
Original Source Entertainment, Inc. (A Development Stage Company) - Consolidated Balance Sheets (USD $)
|
Sep. 30, 2013
|
Dec. 31, 2012
|
---|---|---|
Current Assets | ||
Cash | $ 608 | $ 1,118 |
Total Current Assets | 608 | 1,118 |
TOTAL ASSETS | 608 | 1,118 |
Current Liabilities | ||
Related party payables | 952 | 952 |
Accrued interest payable | 1,454 | 403 |
Notes payable - current | 26,500 | 17,000 |
Total Current Liabilities | 28,906 | 18,355 |
Total Liabilities | 28,906 | 18,355 |
Stockholders' Equity | ||
Preferred stock, $0.001 par value, 5,000,000 shares authorized; none issued and outstanding | 0 | 0 |
Common stock, $0.001 par value, 45,000,000 shares authorized; 6,573,000 shares issued and outstanding | 5,073 | 5,073 |
Additional paid-in capital | 44,577 | 28,077 |
Deficit accumulated during the development stage | (77,948) | (50,387) |
Total Stockholders' Equity | (28,298) | (17,237) |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 608 | $ 1,118 |
Note 1. Organization, Operations and Summary of Significant Accounting Policies: Property and Equipment (Policies)
|
9 Months Ended |
---|---|
Sep. 30, 2013
|
|
Policies | |
Property and Equipment | Property and equipment
Property and equipment are recorded at cost and depreciated under the straight line method over each item's estimated useful life. |
Note 1. Organization, Operations and Summary of Significant Accounting Policies: Revenue Recognition (Policies)
|
9 Months Ended |
---|---|
Sep. 30, 2013
|
|
Policies | |
Revenue Recognition | Revenue recognition
Revenue is recognized on an accrual basis after services have been performed under contract terms, the service price to the client is fixed or determinable, and collectability is reasonably assured. |
Note 1. Organization, Operations and Summary of Significant Accounting Policies: Principles of Consolidation (Policies)
|
9 Months Ended |
---|---|
Sep. 30, 2013
|
|
Policies | |
Principles of Consolidation | Principles of consolidation
The accompanying consolidated financial statements include the accounts of Original Source Entertainment, Inc. and its wholly owned subsidiary. All intercompany accounts and transactions have been eliminated in consolidation. |
Note 1. Organization, Operations and Summary of Significant Accounting Policies: Stock Based Compensation (Policies)
|
9 Months Ended |
---|---|
Sep. 30, 2013
|
|
Policies | |
Stock Based Compensation | Stock based compensation
The Company accounts for employee and non-employee stock awards under ASC 718, whereby equity instruments issued to employees for services are recorded based on the fair value of the instrument issued and those issued to non-employees are recorded based on the fair value of the consideration received or the fair value of the equity instrument, whichever is more reliably measurable. |
Document and Entity Information (USD $)
|
9 Months Ended |
---|---|
Sep. 30, 2013
|
|
Document and Entity Information: | |
Entity Registrant Name | Original Source Entertainment, Inc. |
Document Type | 10-Q |
Document Period End Date | Sep. 30, 2013 |
Amendment Flag | false |
Entity Central Index Key | 0001500198 |
Current Fiscal Year End Date | --12-31 |
Entity Public Float | $ 0 |
Entity Filer Category | Smaller Reporting Company |
Entity Current Reporting Status | Yes |
Entity Voluntary Filers | Yes |
Entity Well-known Seasoned Issuer | No |
Document Fiscal Year Focus | 2013 |
Document Fiscal Period Focus | Q3 |
Entity Common Stock, Shares Outstanding | 6,573,000 |