10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

[X]	Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
	For the quarterly period ended February 28, 2015
[  ]	Transition Report pursuant to 13 or 15(d) of the Securities Exchange Act of 1934
	For the transition period from __________ to__________
	Commission File Number: 333-171423

Berkshire Homes, Inc.

(Exact name of registrant as specified in its charter)

Nevada	68-0680858
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification No.)
2375 East Camelback Road, Suite 600 Phoenix, AZ 85016
(Address of principal executive offices)
(602) 387-5393
(Registrant’s telephone number)
_______________________________________________________
(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has 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 (§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 [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.

[  ] Large accelerated filer	[  ] Accelerated filer
[  ] Non-accelerated filer	[X] Smaller reporting company

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). [  ] Yes [X] No

State the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 1,572,002 as of March 13, 2015.

TABLE OF CONTENTS
		Page
PART I – FINANCIAL INFORMATION
Item 1:	Financial Statements	3
Item 2:	Management’s Discussion and Analysis of Financial Condition and Results of Operations	4
Item 3:	Quantitative and Qualitative Disclosures About Market Risk	6
Item 4:	Controls and Procedures	6
PART II – OTHER INFORMATION
Item 1:	Legal Proceedings	8
Item 1A:	Risk Factors	8
Item 2:	Unregistered Sales of Equity Securities and Use of Proceeds	8
Item 3:	Defaults Upon Senior Securities	8
Item 4:	Mine Safety Disclosures	8
Item 5:	Other Information	8
Item 6:	Exhibits	8

2

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

Our consolidated financial statements included in this Form 10-Q are as follows:

F-1	Consolidated Balance Sheets as of February 28, 2015 and November 30, 2014 (unaudited);
F-2	Consolidated Statements of Operations for the three months ended February 28, 2015 and 2014 (unaudited);
F-3	Consolidated Statements of Cash Flows for the three months ended February 28, 2015 and 2014 (unaudited); and
F-4	Notes to Consolidated Financial Statements.

These consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and the SEC instructions to Form 10-Q. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. Operating results for the interim period ended February 28, 2015 are not necessarily indicative of the results that can be expected for the full year.

3

BERKSHIRE HOMES, INC.

CONSOLIDATED BALANCE SHEETS (unaudited)

AS OF 

	February 28, 2015			November 30, 2014
ASSETS
Properties
Properties under development	$	4,437,047		$	4,963,545
Properties held for sale		1,793,101			932,171
Properties, net		6,230,148			5,895,716
Cash and equivalents	$	118,004		$	353,685
Prepaid expenses		25,000			5,000
Assets related to discontinued operations,  net of accumulated depreciation of $ $36,584 (2014-$24,923)		2,624,386			2,634,247
Vehicle, net of accumulated depreciation of $3,687 (2014-$1,229)		25,813			28,271
Deferred financing costs		2,866			5,322
Total Assets	$	9,026,217		$	8,922,241
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Accounts payable and accrued liabilities	$	15,394		$	26,529
Accrued interest		486,352			373,544
Accounts payable to related parties		494,020			494,020
Advances due to Cannabis-Rx, Inc.		149,472			149,472
Promissory notes		9,150,000			9,150,000
Total liabilities		10,295,238			10,193,565
Stockholders’ Deficit
Preferred stock, $0.0001 par value, 20,000,000 shares authorized; 2,000,000 and 2,000,000 shares issued and outstanding		200			200
Common Stock, $0.0001 par value, 500,000,000 shares authorized, 1,572,002 and 1,572,002 shares issued and outstanding		157			157
Additional paid-in capital		168,243			168,243
Preferred subscription receivable		(20,000	)		(20,000	)
Accumulated Deficit		(1,417,621	)		(1,419,924	)
Total Stockholders’ Deficit		(1,269,021	)		(1,271,324	)
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT	$	9,026,217		$	8,922,241

See accompanying notes to unaudited consolidated financial statements.

F-1

BERKSHIRE HOMES INC.  

CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)

FOR THE THREE MONTHS ENDED

	February 28, 2015			February 28, 2014
REVENUES
Property sales	$	675,419		$	—
		675,419			—
COST OF SALES
Property costs		565,252			—
		565,252			—
GROSS PROFIT		110,167			—
EXPENSES
Depreciation		2,458			—
Consulting fees		5,000			12,000
Insurance		5,813			—
General and administrative		15,362			8,993
Professional fees		18,053			8,252
Management fees and expenses		30,947			18,750
TOTAL EXPENSES		77,633			47,995
INCOME (LOSS) FROM   OPERATIONS		32,534			(47,995	)
OTHER INCOME (EXPENSE)
Interest expense		(115,264	)		(35,581	)
TOTAL OTHER ( EXPENSE)		(115,264	)		(35,581	)
LOSS FROM CONTINUING OPERATIONS		(82,730	)		(83,576	)
INCOME FROM DISCONTINUED OPERATIONS		85,033			—
NET INCOME (LOSS)	$	2,303		$	(83,576	)
NET INCOME LOSS PER SHARE: BASIC AND DILUTED FROM CONTINUING OPERATIONS	$	(0.05	)	$	(0.04	)
NET INCOME PER SHARE: BASIC AND DILUTED FROM DISCONTINUED OPERATIONS	$	0.05		$	0.00
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING: BASIC AND DILUTED		1,572,002			1,978,000

See accompanying notes to unaudited consolidated financial statements.

F-2

BERKSHIRE HOMES, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)

FOR THE THREE MONTHS ENDED 

	February 28, 2015			February 28, 2014
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) for the period	$	2,303		$	(83,576	)
Adjustments to reconcile net (loss) to net cash used in operating activities:
Depreciation		14,119			—
Amortization of deferred financing costs		2,456			2,456
Changes in operating assets and liabilities:
Prepaid expenses		(25,000	)		—
Inventory of properties under development		(334,432	)		(126,324	)
Accounts payable		(6,135	)		(5,399	)
Accrued interest		112,808			33,125
Net Cash Used in Operating Activities		(233,881	)		(179,718	)
CASH FLOWS FROM FINANCING ACTIVITIES
Advances from Cannabis-Rx, Inc.		—			37,353
Net Cash Provided by Financing Activities		—			37,353
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of properties, rehabilitation expense		(1,800	)		—
Net Cash Used in Investing Activities		(1,800	)		—
Net Change in Cash		(235,681	)		(142,365	)
Cash and Cash equivalents, beginning of period		353,685			146,048
Cash and Cash equivalents, end of period	$	118,004		$	3,683
SUPPLEMENTAL CASH FLOW INFORMATION:
Interest paid	$	—		$	—
Income taxes paid	$	—		$	—

See accompanying notes to unaudited consolidated financial statements.

F-3

BERKSHIRE HOMES, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED FEBRUARY 28, 2015 AND 2014

NOTE 1 – DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

Description of Business

Berkshire Homes, Inc. (the “Company”) was incorporated in Nevada on June 2, 2010.

The Company operated an agricultural consulting business until November 16, 2012 when upon change of management the Company changed its business focus to acquisition, rehabilitation and sale or lease of distressed residential real estate in the United States.  

NOTE 2- SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation  

The accompanying unaudited interim financial statements of Berkshires Homes, Inc. (the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission, and should be read in conjunction with the Company’s audited 2014 annual financial statements and notes thereto filed on Form 10-K with the SEC. In the opinion of management, all adjustments, consisting of normal reoccurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods present have been reflected herein. The results of operation for interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the financial statements, which would substantially

NOTE 3 - RELATED PARTY TRANSACTIONS 

During the three months ended February 28, 2015 and 2014, the Company incurred management fees and expenses of $30,947 and $18,750 to its officers , respectively.

As of February 28, 2015 , the Company had a payable of $482,243 owed to Bay Capital A.G., who became a related party during 2013 by obtaining majority ownership and $11,777 owed to the Chief Executive Officer of the Company.

During 2013, Cannabis-Rx Inc., an entity with common ownership and management, advanced an aggregate of $50,496 to us which was outstanding as of November 30, 2013. In addition, in 2014, Cannabis advanced an additional $99,093 to us, $117 of which was written off as the of the year ended November 30, 2014. As at February 28, 2015, the total advances from Cannabis was $149,472.

The amounts due to these related parties are due on demand, non-interest bearing and unsecured.

NOTE 4 - PROMISSORY NOTES

On June 13, 2013, the Company borrowed $2,150,000 at an interest rate of 5% per annum. The promissory note is unsecured and is due on June 13, 2015. In connection with the note, the Company paid a fee of $19,650 to a third party which was recorded as deferred financing costs and is being amortized to interest expense over the life of the loan using the effective interest rate method. During the period ended February 28, 2015, amortization expense of $9,824 was recognized and unamortized financing costs of $5,323 are deferred on the balance sheet.

On June 27, 2013, the Company borrowed $500,000 at an interest rate of 5% per annum. The promissory note is unsecured and is due on June 27, 2015.

On April 21, 2014, the Company borrowed $4,500,000 at an interest rate of 5% per annum. The promissory note is unsecured and is due on April 21, 2016.

On June 23, 2014, the Company borrowed $2,000,000 at an interest rate of 5% per annum. The promissory note is unsecured and is due on June 23, 2016.

F-4

NOTE 5 - COMMON STOCK

On February 12, 2014, the Company authorized a class of Series A preferred stock consisting of 5,000,000 shares with a par value of $ 0.0001 per share. On February 12, 2014, the Company agreed to issue 2,000,000 such shares for cash of $20,000. As of February 28, 2015, the Company had not received the proceeds of the share subscription and the proceeds have been recorded as subscription receivable.

NOTE 6 – ACQUISITION

On June 27, 2014, the Company acquired a 100% ownership interest in a property located in Tallahassee, Florida at an auction for a purchase price of $2,500,000 and rehabilitation expenses of $159,170 for a total of $2,659,170. During the period ended February 28, 2015, the Company incurred rehabilitation expenses of $1,800 related to the property. The property consisted of 56 residential units consisting of one and two bedrooms. There were preexisting  leases. However, due to the short-term nature of the leases, no value was assigned to them. The property was purchased for the purpose of resale after renovations. Offers for the purchase of the property have been received.

The following table summarizes the preliminary estimated fair values of the assets and liabilities acquired as part of the Tallahasee purchase:

Land	$	556,000
Buildings, net and Improvements		2,078,247
Estimated fair value of assets and liabilities acquired	$	2,634,247

The rental income and expenses from the discontinued operations for the three months ended February 28, 2015 is as follows:

Rental Income	$	27,393
Purchase deposit forfeited		75,000	*
Rental Expense		(5,699	)
Depreciation Expense		(11,661	)
Total rental income and expense		85,033

* the purchase offer executed on February 2, 2015 has fallen through.

The property has been classified as held for sale. As a result the assets and rental income have been presented as discontinued operations in the financial statements.

F-5

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Forward-Looking Statements

Certain statements, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives, and expected operating results, and the assumptions upon which those statements are based, are “forward-looking statements.” These forward-looking statements generally are identified by the words “believes,” “project,” “expects,” “anticipates,” “estimates,” “intends,” “strategy,” “plan,” “may,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements. Our ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse effect on our operations and future prospects on a consolidated basis include, but are not limited to: changes in economic conditions, legislative/regulatory changes, availability of capital, interest rates, competition, and generally accepted accounting principles. These risks and uncertainties should also be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements.

Company Overview

We are focused on the acquisition, rehabilitation and sale of distressed residential properties in the United States. We will, however, consider the acquisition of commercial and multi-family properties as well. Our corporate offices are located at 2375 East Camelback Road, Suite 600, Phoenix, AZ 85016 and our phone number is (602) 387-5393.

We believe that the current housing market environment presents an unprecedented opportunity for those who have the expertise, operating platform, technology systems and capital in place to execute an acquisition and operating strategy in a cost-effective manner. We intend to build a geographically diversified portfolio of primarily residential homes in target markets that we believe exhibit favorable demographics and long-term economic trends, attractive acquisition prices and appreciation potential, as well as rental yields with commercial and multi-family properties. We intend to implement a buy and renovate strategy to increase value, livability, and attractiveness, and then sell the properties or we may keep them for value as rental properties.

In furthering our business plan, we have been actively searching for capital to purchase distressed properties and build our inventory. We have sold an aggregate of $9,150,000 of our 5% unsecured promissory notes (the “5% Notes”) for gross proceeds to us of $9,150,000. The 5% Notes accrued interest at the rate of 5% per annum are due and payable twenty four months from their respective dates of issuance, subject to acceleration in the event of default and the 5% Notes may be prepaid, in whole or in part, without penalty or premium.

With the money  we have raised through debt financing to date we have acquired 23 properties for a purchase price of $11,855,762.02. Of these 23 properties we have sold 12 for $6,039,800.00 prior to closing costs. Also,1 properties are under contract for sale, 2 are listed for sale, and 8 are under rehab. The properties include single and multi-family residences in 6 States. We plan to recycle all the capital from these properties and purchase more similar type assets to rehabilitate and sell. Additionally, we plan to expand our portfolio and have been looking at other major urban markets to enter into. Our short and long-term goals are to seek out opportunistic real estate investments that meet our underwriting criteria including twenty percent annualized returns. There is no assurance, however, that we will find the assets that fit our parameters or that we will raise the needed capital to implement our business plan.

We will continue our efforts to secure additional financing, which is necessary to implement our business strategy of acquiring a substantial portfolio investment properties. We plan to continue our efforts to secure financing. 

Results of Operations for the three months ended February 28, 2015 and 2014

Revenues

We generated sales of $675,419 for the three months ended February 28, 2015, as compared with no sales for the same period ended February 28, 2014. Our cost of sales totaled $565,252 for the three months ended February 28, 2015. Our costs of sales includes: purchase price, rental expenses, rehabilitation, escrow, closing costs, and commissions. We achieved a gross profit of $110,167 for the three months ended February 28, 2015, which represented a 16% margin.

Discontinued Operations

We purchased a property for $2,500,000 (and rehabilitation expenses of $159,170) that is now related to discontinued operations and held for sale. Our income income from these discontinued operations totaled $85,033 for the three months ended February 28, 2015.

4

Operating Expenses

Operating expenses increased by $29,638 to $77,633 for the three months ended February 28, 2015 from $47,995 for the same period ended February 28, 2014. Our operating expenses for the three months ended February 28, 2015 mainly consisted of management fees and expenses of $30,947, professional fees of $18,053, general and administrative expenses of $15,362, depreciation of $2,458, consulting fees of $5,000 and insurance expenses of $5,813. In comparison, our operating expenses for the same period ended February 28, 2014 mainly consisted of management fees and expenses of $18,750, general and administrative expenses of $8,993, professional fees in the amount of $8,252, and consulting fee of $12,000. 

We anticipate our operating expenses will increase as we continue to expand our operations. The increase will be attributable to administrative and operating costs associated with the management associated with the increase in the acquisition, renovation and sale of residential properties and our continued reporting obligations with the Securities and Exchange Commission.

Interest Expenses

We incurred interest expenses of $115,264 for the three months ended February 28, 2015, as compared with $35,581 for the same period ended February 28, 2014.

On April 21, 2014, we borrowed $4,500,000 at an interest rate of 5% per annum. The promissory note is unsecured and is due on April 21, 2016.

On June 23, 2014, we borrowed $2,000,000 at an interest rate of 5% per annum. The promissory note is unsecured and is due on June 23, 2016.

We expect that interest expenses will increase as we plan to take on more debt to finance our property acquisitions resulting in higher interest expenses. 

Net Income/Loss

We incurred net income of $2,303 for the three months ended February 28, 2015, compared to a net loss of $83,567 for the same period ended February 28, 2014. For the three months ended February 28, 2015, we incurred a loss of $82,730 from continuing operations and net income of $85,033 from discontinued operations.

Liquidity and Capital Resources

As of February 28, 2015, we had total assets of $9,026,217. We had total liabilities of $10,295,238 as of February 28, 2015.

Operating activities used $233,881 in cash for the three months ended February 28, 2015, as compared with $179,718 used for the same period ended February 28, 2014. Our negative operating cash flow for February 28, 2015 was mainly a result of the increase in our real property inventory.

Investing activities used $1,800 in cash for three months ended February 28, 2015, as compared with $0 used for same period ended February 28, 2014. Our negative investing cash flow for February 28, 2015 was mainly a result of a property related to discontinued operations now held for sale.

Financing activities for the three months ended February 28, 2015 generated $0 in cash, as compared with cash flows provided by financing activities of $37,353 for same period ended February 28, 2014. Our positive cash flow from financing activities for the three months ended February 28, 2014 was the result of money obtained from Cannabis-RX, Inc.

As of February 28, 2015, we had $118,004 in cash. With the cash on hand, we have sufficient cash to operate our business at the current level for the next twelve months. Our plan, however, is to acquire more properties, and to do this, we intend to fund our expansion through debt and/or equity financing arrangements. We do not have any formal commitments or arrangements for the sales of stock or the advancement or loan of funds at this time. There can be no assurance that such additional financing will be available to us on acceptable terms, or at all.

5

Critical Accounting Policies

In December 2001, the SEC requested that all registrants list their most “critical accounting polices” in the Management Discussion and Analysis. The SEC indicated that a “critical accounting policy” is one which is both important to the portrayal of a company’s financial condition and results, and requires management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain.

Our critical accounting policies are set forth in Note 2 to the financial statements.

Recently Issued Accounting Pronouncements

We do not expect the adoption of recently issued accounting pronouncements to have a significant impact on our results of operations, financial position or cash flow.

Off Balance Sheet Arrangements

As of February 28, 2015, there were no off balance sheet arrangements.

Item 3.  Quantitative and Qualitative Disclosures About Market Risk

A smaller reporting company is not required to provide the information required by this Item.

Item 4.  Controls and Procedures

Disclosure Controls and Procedures

We conducted an evaluation, with the participation of our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended, or the Exchange Act, as of February 28, 2015, to ensure that information required to be disclosed by us in the reports filed or submitted by us under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities Exchange Commission’s rules and forms, including to ensure that information required to be disclosed by us in the reports filed or submitted by us under the Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officer, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that as of February 28, 2015, our disclosure controls and procedures were not effective at the reasonable assurance level due to the material weaknesses identified and described below.

Our principal executive officers do not expect that our disclosure controls or internal controls will prevent all error and all fraud. Although our disclosure controls and procedures were designed to provide reasonable assurance of achieving their objectives and our principal executive officers have determined that our disclosure controls and procedures are effective at doing so, a control system, no matter how well conceived and operated, can provide only reasonable, not absolute assurance that the objectives of the system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented if there exists in an individual a desire to do so. There can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.

6

Remediation Plan to Address the Material Weaknesses in Internal Control over Financial Reporting

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis. Management identified the following three material weaknesses that have caused management to conclude that, as of February 28, 2015, our disclosure controls and procedures, and our internal control over financial reporting, were not effective at the reasonable assurance level:

•       We do not have written documentation of our internal control policies and procedures. Written documentation of key internal controls over financial reporting is a requirement of Section 404 of the Sarbanes-Oxley Act as of the period ending February 28, 2015. Management evaluated the impact of our failure to have written documentation of our internal controls and procedures on our assessment of our disclosure controls and procedures and has concluded that the control deficiency that resulted represented a material weakness.

•       We do not have sufficient segregation of duties within accounting functions, which is a basic internal control. Due to our size and nature, segregation of all conflicting duties may not always be possible and may not be economically feasible. However, to the extent possible, the initiation of transactions, the custody of assets and the recording of transactions should be performed by separate individuals. Management evaluated the impact of our failure to have segregation of duties on our assessment of our disclosure controls and procedures and has concluded that the control deficiency that resulted represented a material weakness.

•       Effective controls over the control environment were not maintained. Specifically, a formally adopted written code of business conduct and ethics that governs our employees, officers, and directors was not in place. There is a material weakness in our management not having GAAP and SEC reporting expertise. Additionally, management has not developed and effectively communicated to employees its accounting policies and procedures. This has resulted in inconsistent practices. Further, our Board of Directors does not currently have any independent members and no director qualifies as an audit committee financial expert as defined in Item 407(d)(5)(ii) of Regulation S-K. Since these entity level programs have a pervasive effect across the organization, management has determined that these circumstances constitute a material weakness.

To address these material weaknesses, management performed additional analyses and other procedures to ensure that the financial statements included herein fairly present, in all material respects, our financial position, results of operations and cash flows for the periods presented. Accordingly, we believe that the financial statements included in this report fairly present, in all material respects, our financial condition, results of operations and cash flows for the periods presented.

To remediate the material weakness in our documentation, evaluation and testing of internal controls we plan to engage a third-party firm to assist us in remedying this material weakness once resources become available.

We intend to remedy our material weakness with regard to insufficient segregation of duties by hiring additional employees in order to segregate duties in a manner that establishes effective internal controls once resources become available.

Changes in Internal Control over Financial Reporting

No change in our system of internal control over financial reporting occurred during the period covered by this report, the period ended February 28, 2015, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

7

 PART II – OTHER INFORMATION

Item 1. Legal Proceedings

We are not a party to any pending legal proceeding. We are not aware of any pending legal proceeding to which any of our officers, directors, or any beneficial holders of 5% or more of our voting securities are adverse to us or have a material interest adverse to us.

Item 1A. Risk Factors

A smaller reporting company is not required to provide the information required by this Item.

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

None

Item 3. Defaults upon Senior Securities

None

Item 4. Mine Safety Disclosures

N/A

Item 5. Other Information

None

Item 6. Exhibits

Exhibit Number	Description of Exhibit
31.1	Certification of Chief Executive Officer 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 Chief Financial Officer 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 Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101**	The following materials from the Company’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2015 formatted in Extensible Business Reporting Language (XBRL).
**Provided herewith

8

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.

	Berkshire Homes, Inc.
Date:	April 20, 2015
By:	/s/ Llorn Kylo
	Llorn Kylo
Title:	President, Chief Executive Officer, Chief Financial Officer and Director

9

EX-31.1

CERTIFICATIONS

I, Llorn Kylo, certify that;

1. I have reviewed this quarterly report on Form 10-Q for the quarter ended February 28, 2015 of Berkshire Homes, Inc. (the “registrant”);

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 officer 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 control 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 our 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 registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer 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 the 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 control over financial reporting.

Date: April 20, 2015

/s/ Llorn Kylo

By: Llorn Kylo

Title: Chief Executive Officer

EX-31.2

CERTIFICATIONS

I, Munjit Johal, certify that;

1. I have reviewed this quarterly report on Form 10-Q for the quarter ended February 28, 2015 of Berkshire Homes, Inc. (the “registrant”);

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 officer 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 control 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 our 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 registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer 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 the 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 control over financial reporting.

Date: April 20, 2015

/s/ Munjit Johal

By: Munjit Johal

Title: Chief Financial Officer

EX-32.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND

CHIEF FINANCIAL OFFICER

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 Berkshire Homes, Inc. (the “Company”) on Form 10-Q for the quarter ended February 28, 2015 filed with the Securities and Exchange Commission (the “Report”), I, Llorn Kylo, Chief Executive Officer of the Company, and I, Munjit Johal, Chief 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) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the consolidated financial condition of the Company as of the dates presented and the consolidated result of operations of the Company for the periods presented.

By:	/s/ Llorn Kylo
Name:	Llorn Kylo
Title:	Principal Executive Officer and Director
Date:	April 20, 2015

By:	/s/ Munjit Johal
Name:	Munjit Johal
Title:	Principal Financial Officer
Date:	April 20, 2015

This certification has been furnished solely pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

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COMMON STOCK (Details Narrative) (USD $)	Feb. 28, 2015	Nov. 30, 2014	Feb. 12, 2014
Equity [Abstract]
Common Stock, authorized	500,000,000	500,000,000
Common Stock, par value	$ 0.0001	$ 0.0001
Preferred Stock, authorized	20,000,000	20,000,000
Preferred Stock, par value			$ 5,000,000
Series A Preferred stock, par value			$ 5,000,000
Series A Preferred stock, authorized shares			0.0001
Series A Preferred stock, issued shares			2,000,000
Series A Preferred stock, amount			$ 20,000

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STATEMENTS OF OPERATIONS (USD $)	3 Months Ended
	Feb. 28, 2015	Feb. 28, 2014
REVENUES
Property sales	$ 675,419
REVENUES	675,419
COST OF SALES
Property costs	565,252
COST OF SALES	565,252
GROSS PROFIT	110,167
EXPENSES
Depreciation	2,458
Consulting fees	5,000	12,000
Insurance	5,813
General and administrative	15,362	8,993
Professional fees	18,053	8,252
Management fees and expenses	30,947	18,750
TOTAL EXPENSES	77,633	47,995
INCOME (LOSS) FROM OPERATIONS	32,534	(47,995)
OTHER INCOME (EXPENSE)
Interest expense	(115,264)	(35,581)
TOTAL OTHER (EXPENSE)	(115,264)	(35,581)
LOSS FROM CONTINUING OPERATIONS	(82,730)	(83,576)
INCOME FROM DISCONTINUED OPERATIONS	85,033
NET LOSS	$ 2,303	$ (83,576)
NET INCOME PER SHARE BASIC AND DILUTED FROM CONTINUING OPERATIONS	$ (0.05)	$ (0.04)
NET LOSS PER SHARE BASIC AND DILUTED FROM DISCONTINUED OPERATIONS	$ 0.05	$ 0.00
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING BASIC AND DILUTED	1,572,002	1,978,000

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COMMON STOCK

3 Months Ended

Feb. 28, 2015

Equity [Abstract]

COMMON STOCK

On February 12, 2014, the Company authorized a class of Series A preferred stock consisting of 5,000,000 shares with a par value of $ 0.0001 per share. On February 12, 2014, the Company agreed to issue 2,000,000 such shares for cash of $20,000. As of February 28, 2015, the Company had not received the proceeds of the share subscription and the proceeds have been recorded as subscription receivable.

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ACQUISITION - Schedule of Estimated Fair Values of the Assets and Liabilities Acquired (Details) (Tallahasee Purchase, USD $)	Feb. 28, 2015
Tallahasee Purchase
Land	$ 556,000
Buildings, net and Improvements	2,078,247
Estimated fair value of assets and liabilities acquired	$ 2,634,247

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DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

3 Months Ended

Feb. 28, 2015

Accounting Policies [Abstract]

DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

Description of Business

Berkshire Homes, Inc. (the “Company”) was incorporated in Nevada on June 2, 2010.

The Company operated an agricultural consulting business until November 16, 2012 when upon change of management the Company changed its business focus to acquisition, rehabilitation and sale or lease of distressed residential real estate in the United States.  

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RELATED PARTY TRANSATIONS

3 Months Ended

Feb. 28, 2015

Related Party Transactions [Abstract]

RELATED PARTY TRANSATIONS

During the three months ended February 28, 2015 and 2014, the Company incurred management fees and expenses of $30,947 and $18,750 to its officers , respectively.

As of February 28, 2015 , the Company had a payable of $482,243 owed to Bay Capital A.G., who became a related party during 2013 by obtaining majority ownership and $11,777 owed to the Chief Executive Officer of the Company.

During 2013, Cannabis-Rx Inc., an entity with common ownership and management, advanced an aggregate of $50,496 to us which was outstanding as of November 30, 2013. In addition, in 2014, Cannabis advanced an additional $99,093 to us, $117 of which was written off as the of the year ended November 30, 2014. As at February 28, 2015, the total advances from Cannabis was $149,472.

The amounts due to these related parties are due on demand, non-interest bearing and unsecured.

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ACQUISITION

3 Months Ended

Feb. 28, 2015

Business Combinations [Abstract]

ACQUISITION

On June 27, 2014, the Company acquired a 100% ownership interest in a property located in Tallahassee, Florida at an auction for a purchase price of $2,500,000 and rehabilitation expenses of $159,170 for a total of $2,659,170. During the period ended February 28, 2015, the Company incurred rehabilitation expenses of $ 1,800 related to the property. The property consisted of 56 residential units consisting of one and two bedrooms. There were preexisting  leases. However, due to the short-term nature of the leases, no value was assigned to them. The property was purchased for the purpose of resale after renovations. Offers for the purchase of the property have been received. On February 2, 2015, a written offer for $3,500,000 has been executed.

The following table summarizes the preliminary estimated fair values of the assets and liabilities acquired as part of the Tallahasee purchase:

Land	$	556,000
Buildings, net and Improvements		2,078,247
Estimated fair value of assets and liabilities acquired	$	2,634,247

The rental income and expenses from the discontinued operations for the three months ended February 28, 2015 is as follows:

Rental Income	$	27,393
Purchase deposit forfeited		75,000	*
Rental Expense		(5,699	)
Depreciation Expense		(11,661	)
Total rental income and expense		85,033

* the purchase offer executed on February 2, 2015 has fallen through.

The property has been classified as held for sale. As a result the assets and rental income have been presented as discontinued operations in the financial statements.

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PROMISSORY NOTES

3 Months Ended

Feb. 28, 2015

Debt Disclosure [Abstract]

PROMISSORY NOTES

On June 13, 2013, the Company borrowed $2,150,000 at an interest rate of 5% per annum. The promissory note is unsecured and is due on June 13, 2015. In connection with the note, the Company paid a fee of $19,650 to a third party which was recorded as deferred financing costs and is being amortized to interest expense over the life of the loan using the effective interest rate method. During the period ended February 28, 2015, amortization expense of $9,824 was recognized and unamortized financing costs of $5,323 are deferred on the balance sheet.

On June 27, 2013, the Company borrowed $500,000 at an interest rate of 5% per annum. The promissory note is unsecured and is due on June 27, 2015.

On April 21, 2014, the Company borrowed $4,500,000 at an interest rate of 5% per annum. The promissory note is unsecured and is due on April 21, 2016.

On June 23, 2014, the Company borrowed $2,000,000 at an interest rate of 5% per annum. The promissory note is unsecured and is due on June 23, 2016.

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BALANCE SHEETS (Parenthetical) (USD $)	Feb. 28, 2015	Nov. 30, 2014
Statement of Financial Position [Abstract]
Discontinued Operations, accumulated depreciation	$ 36,584	$ 24,923
Vehicle accumulated depreciation	$ 3,687	$ 1,229
Preferred stock, par value	$ 0.0001	$ 0.0001
Preferred stock, authorized shares	20,000,000	20,000,000
Preferred stock, issued shares	2,000,000	2,000,000
Preferred stock, outstanding shares	2,000,000	20,000,000
Common stock, par value	$ 0.0001	$ 0.0001
Common stock, authorized shares	500,000,000	500,000,000
Common stock, issued shares	1,572,002	1,572,002
Common stock, outstanding shares	1,572,002	1,572,002

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DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION (Details Narrative)	3 Months Ended
	Feb. 28, 2015
Accounting Policies [Abstract]
Date of Incorporation	Jun. 02, 2010

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STATEMENTS OF CASH FLOWS (USD $)	3 Months Ended
	Feb. 28, 2015	Feb. 28, 2014
CASH FLOWS FROM OPERATING ACTIVITIES
NET LOSS	$ 2,303	$ (83,576)
Adjustments to reconcile net (loss) to net cash used in operating activities:
Depreciation	14,119
Amortization of deferred financing costs	2,456	2,456
Changes in operating assets and liabilities:
Prepaid expenses	(25,000)
Inventory of properties under development	(334,432)	(126,324)
Accounts payable	(6,135)	(5,399)
Accrued interest	112,808	33,125
Net Cash Used in Operating Activities	(233,881)	(179,718)
CASH FLOWS FROM FINANCING ACTIVITIES
Advances from Cannabis-Rx, Inc.		37,353
Net Cash Provided by Financing Activities		37,353
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of properties, rehabilitation expense	(1,800)
Net Cash Used by Investing Activities	(1,800)
Net Change in cash	(235,681)	(142,365)
Cash and Cash equivalents, beginning of period	353,685	146,048
Cash and Cash equivalents, end of period	118,004	3,683
SUPPLEMENTAL CASH FLOW INFORMATION:
Interest paid
Income taxes paid

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BALANCE SHEETS (USD $)	Feb. 28, 2015	Nov. 30, 2014
Properties
Properties under development	$ 4,437,047	$ 4,963,545
Properties held for sale	1,793,101	932,171
Properties, net	6,230,148	5,895,716
Cash and equivalents	118,004	353,685
Prepaid expenses	25,000	5,000
Assets related to discontinued operations, net of accumulated depreciation of $36,584 (2014-$24,923)	2,624,386	2,634,247
Vehicle, net of accumalated depreciation of $1,229	25,813	28,271
Deferred financing costs	2,866	5,322
TOTAL ASSETS	9,026,217	8,922,241
LIABILITIES AND STOCKHOLDERS DEFICIT
Accounts payable and accrued liabilities	15,394	26,529
Accured interest	486,352	373,544
Accounts payable to related parties	494,020	494,020
Advances due to Cannabis-Rx, Inc.	149,472	149,472
Promissory notes	9,150,000	9,150,000
Total liabilities	10,295,238	10,193,565
Stockholders Deficit
Preferred stock, $0.0001 par value, 20,000,000 shares authorized; 2,000,000 and 2,000,000 shares issued and outstanding	200	200
Common Stock, $0.0001 par value, 500,000,000 shares authorized, 1,572,000 and 2,152,000 shares issued and outstanding	157	157
Additional paid-in capital	168,243	168,243
Preferred share subscription receivable	(20,000)	(20,000)
Accumulated Deficit	(1,417,621)	(1,419,924)
Total Stockholders Deficit	(1,269,021)	(1,271,324)
TOTAL LIABILITIES AND STOCKHOLDERS DEFICIT	$ 9,026,217	$ 8,922,241

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ACQUISITION (Tables)

3 Months Ended

Feb. 28, 2015

Business Combinations [Abstract]

Schedule of Estimated Fair Values of the Assets and Liabilities Acquired

Land	$	556,000
Buildings, net and Improvements		2,078,247
Estimated fair value of assets and liabilities acquired	$	2,634,247

Schedule of Rental Income and Expenses

Rental Income	$	27,393
Purchase deposit forfeited		75,000
Rental Expense		(5,699	)
Depreciation Expense		(11,661	)
Total rental income and expense		85,033

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PROMISSORY NOTES (Details Narrative) (USD $)	3 Months Ended
	Feb. 28, 2015	Feb. 28, 2014	Nov. 30, 2014
Interest expense	$ 115,264	$ 35,581
Amortization expense	2,456	2,456
Long term liability	9,150,000		9,150,000
Interest Expense	(115,264)	(35,581)
Promissory Note 1
Date of Debt Instrument	Jun. 13, 2013
Issuance of promissory notes	2,150,000
Interest expense	19,650
Interest rate	5.00%
Amortization expense	9,824
Unamortized financing costs	5,323
Promissory Note 2
Date of Debt Instrument	Jun. 27, 2013
Issuance of promissory notes	500,000
Interest rate	5.00%
Debt Instrument, Due Date	Jun. 27, 2015
Promissory Note 3
Date of Debt Instrument	Apr. 21, 2014
Issuance of promissory notes	4,500,000
Interest rate	5.00%
Debt Instrument, Due Date	Apr. 21, 2016
Promissory Note 4
Date of Debt Instrument	Jun. 23, 2014
Issuance of promissory notes	$ 2,000,000
Interest rate	5.00%
Debt Instrument, Due Date	Jun. 23, 2016

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SIGNIFICANT ACCOUNTING POLICIES (Policies)

3 Months Ended

Feb. 28, 2015

Accounting Policies [Abstract]

Basis of Presentation

The accompanying unaudited interim financial statements of Berkshires Homes, Inc. (the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission, and should be read in conjunction with the Company’s audited 2014 annual financial statements and notes thereto filed on Form 10-K with the SEC. In the opinion of management, all adjustments, consisting of normal reoccurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods present have been reflected herein. The results of operation for interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the financial statements, which would substantially

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SIGNIFICANT ACCOUNTING POLICIES

3 Months Ended

Feb. 28, 2015

Accounting Policies [Abstract]

SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation   

The accompanying unaudited interim financial statements of Berkshires Homes, Inc. (the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission, and should be read in conjunction with the Company’s audited 2014 annual financial statements and notes thereto filed on Form 10-K with the SEC. In the opinion of management, all adjustments, consisting of normal reoccurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods present have been reflected herein. The results of operation for interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the financial statements, which would substantially

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ACQUISITION - Schedule of Rental Income and Expenses (Details) (Tallahasee Purchase, USD $)	3 Months Ended
	Feb. 28, 2015
Tallahasee Purchase
Rental Income	$ 27,393
Purchase deposit foreited	75,000
Rental Expense	(5,699)
Depreciation Expense	11,661
Total rental income and expense	$ 85,033

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RELATED PARTY TRANSATIONS (Details Narrative) (USD $)	3 Months Ended
	Feb. 28, 2015	Feb. 28, 2014	Nov. 30, 2014	Nov. 29, 2014	Nov. 30, 2013
Management fees and expenses	$ 30,947	$ 18,750
Accounts payable to related parties	494,020		494,020
Advances due to Cannabis-Rx, Inc.	149,472		149,472	99,093	50,496
Advances written off				117
Bay Capital AG
Accounts payable to related parties			482,243		482,243
Chief Executive Officer
Accounts payable to related parties			$ 11,777		$ 11,777

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ACQUISITION (Details Narrative) (USD $)	3 Months Ended
	Feb. 28, 2015	Feb. 28, 2014
Rehabilitation expense	$ (1,800)
Tallahasee Purchase
Date of Agreement	Jun. 27, 2014
Property Purchase Price	2,500,000
Property Rehabilitation Expense	159,173
Rehabilitation expense	1,800
Total purchase price	$ 2,659,170

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Document and Entity Information	3 Months Ended
	Feb. 28, 2015	Apr. 13, 2015
Document And Entity Information
Entity Registrant Name	Berkshire Homes, Inc.
Entity Central Index Key	0001505124
Document Type	10-Q
Document Period End Date	Feb. 28, 2015
Amendment Flag	false
Current Fiscal Year End Date	--11-30
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		1,572,002
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2015