fs12012_mediamech.htm

Media Mechanics, Inc.

(A Development Stage Company)

January 31, 2012

	Index

Report of Independent Registered Public Accounting Firm	F–1

Balance Sheets as of January 31, 2012 and 2011	F–2

Statement of Operations for the year ended January 31, 2012, from January 6, 2011 (Inception) to January 31, 2011 and 2012	F–3

Statement of Stockholders’ Equity (Deficit) from January 6, 2011 (Inception) to January 31, 2012	F–4

Statement of Cash Flows for the year ended January 31, 2012, from January 6, 2011 (Inception) to January 31, 2011 and 2012	F–5

Notes to the Financial Statements	F–6

Table of Content

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors of

Media Mechanics, Inc.

(a development stage company)

Toronto, ON, Canada

We have audited the accompanying balance sheets of Media Mechanics, Inc., a development stage company, (the “Company”) as of January 31, 2012 and 2011, and the related statements of operations, stockholders’ equity (deficit) and cash flows for the year ended January 31, 2012 and the periods from January 6, 2011 (inception) through January 31, 2011 and 2012. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform an audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Company as of January 31, 2012 and 2011, and the results of its operations and its cash flows for each the year ended January 31, 2012 and the periods from January 6, 2011 (inception) through January 31, 2011 and 2012, in conformity with accounting principles generally accepted in the United States of America.

/s/ MaloneBailey, LLP

www.malonebailey.com

Houston, Texas

April 6, 2012

F-1

Table of Content

Media Mechanics, Inc.

(A Development Stage Company)

Balance Sheets


ASSETS	January 31, 2012			January 31, 2011

Current Assets

Cash	$	82,133		$	-
Accounts Receivable		389			-

Total Current Assets	$	82,522		$	-


LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)

Current Liabilities

Income Tax Payable	$	1,847		$	-
Deferred Revenue		1,246			-
Due to related parties		1,112			598

Total Current Liabilities		4,205			598


Stockholders’ Equity (Deficit)

Preferred stock Authorized: 100,000,000 shares, par value $0.001		-			-
No shares issued and outstanding
Common stock Authorized: 200,000,000 shares, par value $0.001 7,500,000 and 0 shares issued and outstanding , respectively		7,500			-

Additional paid-in capital		67,500			-

Accumulated other comprehensive loss		(166	)		-

Accumulated earnings during the Development stage		3,483			(598	)

Total Stockholders’ Equity (Deficit)		78,317			(598	)

Total Liabilities and Stockholders’ Equity (Deficit)	$	82,522		$	-

(The accompanying notes are an integral part of these audited financial statements)

F-2

Table of Content

Media Mechanics, Inc.

(A Development Stage Company)

Statement of Operations

	Year Ended January 31, 2012			January 6, 2011 (Inception) to January 31, 2011			January 6, 2011 (Inception) to January 31, 2012
Revenue	$	13,932		$	-		$	13,932

Expenses

General and administrative		8,004			598			8,602

Net Income (loss) Before Provision for Income Taxes		5,928			(598	)		5,330

Provision for Income Taxes		(1,847	)		-			(1,847	)

Net Income (loss)	$	4,081		$	(598	)	$	3,483

Comprehensive Income: Net income (loss)	$	4,081		$	(598	)	$	3,483
Other comprehensive income (loss)
Foreign currency translation adjustments		(166	)		-			(166	)
Comprehensive income (loss)	$	3,915		$	(598	)	$	3,317

Net Income Per Share – Basic and Diluted	$	0.00			n/a			n/a

Weighted Average Shares Outstanding		4,017,857			n/a			n/a

(The accompanying notes are an integral part of these audited financial statements)

F-3

Table of Content

Media Mechanics, Inc.

(A Development Stage Company)

Statement of Stockholders’ Equity (Deficit)

For the period from January 6, 2011 (Date of Inception) to January 31, 2012

										Retained Earnings (Deficit )
							Accumulated			Accumulated
					Additional		Other			During the
	Common Stock				Paid-in		Comprehensive			Development
	Shares		Amount		Capital		Income (Loss)			Stage			Total

Balance, January 6, 2011 (Date of Inception)		-	$	-	$	-	$	-		$	–		$	–

Net loss for the period ended		-		-		-		-			(598	)		(598	)

Balance – January 31, 2011		-		-		-		-			(598	)		(598	)

Common stock issued for cash		7,500,000		7,500		67,500		-			-			75,000
Foreign currency translation adjustment		-		-		-		(166	)		-			(166	)

Net income for the period ended		-		-		-		-			4,081			4,081

Balance - January 31, 2012		7,500,000	$	7,500	$	67,500	$	(166	)	$	3,483		$	78,317

(The accompanying notes are an integral part of these audited financial statements)

F-4

Table of Content

Media Mechanics, Inc.

(A Development Stage Company)

Statement of Cash Flows

	Year Ended January 31, 2012			January 6, 2011 (Date of Inception) to January 31, 2011			January 6, 2011 (Date of Inception) to January 31, 2012


Operating Activities

Net income (loss) for the period	$	4,081		$	(598	)	$	3,483

Adjustments to reconcile ne income (loss) to net cash used in operating activities:

Changes in operating assets and liabilities:
Accounts receivable		(389	)		-			(389	)
Income tax payable		1,847			-			1,847
Amount due to related parties		514			598			1,112
Deferred revenue		1,246			-			1,246

Net Cash Provided By Operating Activities		7,299			-			7,299

Financing Activities

Proceeds from issuance of common stock		75,000			-			75,000

Net Cash Provided by Financing Activities		75,500			-			75,000

Effect of Exchange Rate Changes		(166	)		-			(166	)
Net Increase in Cash		82,133			-			82,133

Cash, Beginning of Period		-			-			-

Cash, End of Period	$	82,133		$	-		$	82,133

Supplemental Disclosures

Interest paid	$	-		$	-		$	–
Income taxes paid		-			-			–

(The accompanying notes are an integral part of these audited financial statements)

F-5

Table of Content

Media Mechanics, Inc.

(A Development Stage Company)

Notes to the Financial Statements

1. Nature of Operations and Continuance of Business

Media Mechanics, Inc. (the “Company”) was incorporated in the state of Nevada on January 6, 2011. The Company has been in the Development stage since inception.

2. Summary of Significant Accounting Policies

a)	Basis of Presentation

These financial statements and notes are presented in accordance with accounting principles generally accepted in the United States. The Company’s fiscal year end is January 31.

b)	Use of Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The Company regularly evaluates estimates and assumptions related to the recoverability of long-lived assets, donated expenses and deferred income tax asset valuation allowances. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.

c)	Cash and Cash Equivalents

The Company considers all highly liquid instruments with a maturity of three months or less at the time of issuance to be cash equivalents.

d)	Financial Instruments

The fair values of financial instruments which include cash and amounts due to related parties were estimated to approximate their carrying values due to the immediate or relatively short maturity of these instruments.

The Company’s operations and financing activities are conducted primarily in United States dollars, and as a result the Company is not subject to significant exposure to market risks from changes in foreign currency rates. Management has determined that the Company is not exposed to significant credit risk.

e)	Earnings per Share

The Company computes net earnings per share in accordance with ASC 740 "Earnings per Share". ASC 260 requires presentation of both basic and diluted earnings per share (“EPS”) on the face of the income statement. Basic EPS is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period including stock options, using the treasury stock method, and convertible preferred stock, using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential common shares if their effect is anti-dilutive.

F-6

Media Mechanics, Inc.

(A Development Stage Company)

Notes to the Financial Statements

2. Summary of Significant Accounting Policies (continued)

f)	Income Taxes

The Company accounts for income taxes using the asset and liability approach. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amounts expected to be realized.

g)	Foreign Currency and Other Comprehensive Income

The functional currency of the Company is the Canadian Dollars. For financial reporting purposes, the financial statements of the Company are translated into the Company’s reporting currency, U.S. Dollars. Assets and liabilities accounts are translated using the closing exchange rate in effect at the balance sheet date, equity accounts are translated using the historical rate and income and expense accounts are translated using the average exchange rate prevailing during the reporting period.

Adjustments resulting from the translation, if any, are included in accumulated other comprehensive income (loss) in stockholders’ equity.

h)	Revenue Recognition

The Company's revenue is derived from providing the web marketing consulting services. The Company recognizes its consulting revenue in accordance with ASC 605, "Revenue Recognition" when the projects are finished, the revenue has been earned, and the collectability is reasonably assured.

i)	Accounts receivable and allowance of doubtful accounts

Accounts receivable are amounts due on sales, are unsecured and are carried at their estimated collectible amounts. Credit is generally extended on a short-term basis; thus accounts receivable do not bear interest. Accounts receivable are periodically evaluated for collectability based on past credit history with clients. Provisions for losses on accounts receivable are determined on the basis of loss experience, known and inherent risk in the account balance and current economic conditions.

j)	Recent Accounting Pronouncements

The Company does not expect the adoption of any recently issued accounting pronouncements to have a significant effect on its financial statements.

3. Related Party Transactions

From time to time the Company borrows money from its directors. For the years ended January 31, 2012 and 2011, the amounts due to related parties are $1,112 and $598, respectively. These advances from the directors bear no interest and they are due on demand.

4. Common Stock

On June 13, 2011, the Company issued 6,000,000 common shares at $0.01 per share for proceeds of $60,000.

On December 15, 2011the Company issued 1,500,000 shares of common stock at $0.01 per share for proceeds of $15,000.

F-7

Media Mechanics, Inc.

(A Development Stage Company)

Notes to the Financial Statements

5. Income tax

As at January 31, 2012, company has net income of $5,928 before the provision for income taxes. Company evaluated the company’s tax liability at statutory rate of 35%, and as at January 31, 2012, company is liable for $1,847 in total taxes due to IRS.

Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. These assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which the temporary differences are expected to reverse. As of January 31, 2012 and 2011, there are no temporary differences.


Large accelerated filer	o	Accelerated filer	o
Non-accelerated filer	o(Do not check if a smaller reporting company)	Smaller reporting company	x

Title of Each Class of Securities to be Registered	Amount to be Registered		Proposed Maximum Offering Price Per Unit1		Proposed Maximum Aggregate Offering Price		Amount of Registration Fee2

Common Stock, par value $0.001 per share		25,000,000	$	0.02	$	500,000	$	57.30

Percentage of Shares Sold	Shares Sold	Proceeds to the Company
25%	6,250,000	$125,000
50%	12,500,000	$250,000
75%	18,750,000	$375,000
100%	25,000,000	$500,000

	Page

Summary Information	5
Summary of the Offering	7
Summary of Financial Information	8
Risk Factors	8
Use of Proceeds	16
Determination of Offering Price	16
Plan of Distribution	16
Description of Securities to Be Registered	17
Interests of Named Experts and Counsel	18
Information with Respect to the Registrant	19
Description of Business	19
Management’s Discussion of Financial Condition and Plan of Operation	23
Description of Property	25
Legal Proceedings	25
Available Information	25
Financial Statements	F-1
Changes In And Disagreements With Accountants On Accounting And Financial Disclosure
Directors, Executive Officers, Promoters and Control Persons	26
Executive Compensation	27
Director Compensation	28
Security Ownership Of Certain Beneficial Owners And Management	29
Certain Relationships And Related Transactions	30
Reports to Stockholders	29
Disclosure Of Commission Position Of Indemnification For Securities Act Liabilities	31
Financial Statements for the Period Ended August 31, 2011
Information Not Required In Prospectus	II-1
Exhibits and Financial Statement Schedules	II-2
Undertakings	II-2
Signatures	II-4

Percentage of Shares Sold	Shares Sold		Proceeds to the Company
25%		6,250,000	$	125,000
50%		12,500,000	$	250,000
75%		18,750,000	$	375,000
100%		25,000,000	$	500,000

Securities being offered by the Company, common stock, par value $0.001	25,000,000 shares of common stock, par value $0.001 (the “Common Stock”).
Offering price per share by the Company.	$0.02 per share of Common Stock.
Number of shares outstanding before the offering of common shares.	7,500,000 shares of Common Stock as of April 6, 2012.
Number of shares outstanding after the offering of common shares if all the shares being offered are sold.	32,500,000 shares of Common Stock will be issued and outstanding after this offering is completed if all the shares being offered are sold.
Minimum number of shares to be sold in this offering	None.
Market for the common shares	There is no public market for the common shares. The price per share of Common Stock is $0.02. Media Mechanics may not be able to meet the requirement for a public listing or quotation of its common stock. Further, even if Media Mechanic’s common stock is quoted or granted listing, a market for the common shares may not develop.
Use of proceeds	Media Mechanics will receive all proceeds from the sale of the common stock. If we are able to sell between 6,250,000 common shares and 25,000,000 common shares being offered, the total gross proceeds to the Company would be between $125,000 and $500,000. After deducting estimated offering expenses of $50,000, the Company intends to use the proceeds from this offering: (i) to develop and test its software, estimated at $300,000 (ii) market the software $100,000, (iii) to pay legal, accounting and transfer agent expenses, contracts, estimated at $10,000, (iv) to setup Internet web servers and website hosting, estimated at $5,000 (v) employees and general operating expenses, estimated at $30,000, (vi) and administrative expenses estimated to cost $5,000.
Termination of the offering	The offering will conclude upon the earlier to occur of : (i) the sale of all 25,000,000 shares of common stock, or (ii) 90 days after this registration statement becomes effective with the Securities and Exchange Commission. Media Mechanics may at its discretion extend the offering for an additional 90 days.
Terms of the offering	The Company’s president and vice president will sell the common stock upon effectiveness of this registration statement.

Balance Sheet	As of January 31, 2012
Total Assets	$82,522
Total Liabilities	$4,205
Stockholder’s Equity	$78,317
Operating Data	January 6, 2011 (Date of Inception) to January 31, 2012
Revenue	13,932
Net Income	3,483
Net Loss Per Share	N/A

	If 25% of Shares Sold			If 50% of Shares Sold			If 75% of Shares Sold			If 100% of Shares Sold
Net proceeds	$	75,000	*	$	200,000	*	$	325,000	*	$	450,000	*

Professional Fees		50,000			50,000			50,000			50,000
Working Capital		2,000			20,000			25,000			40,000
Total	$	52,000		$	70,000		$	75,000		$	90,000
WEBSITE, SALES, MARKETING & ADVERTISING
Website Development and Testing		20,000			105,000			210,000			290,000
Marketing		3,000			25,000			40,000			70,000

Total	$	23,000		$	130,000		$	250,000		$	360,000





TOTALS	$	75,000		$	200,000		$	325,000		$	450,000

Offered Units Sold	Offering Proceeds		Approximate Offering Expenses (1)		Total Net Offering Proceeds		Principal Uses of Net Proceeds
12,500,000 Units (25%)	$	125,000	$	50,000	$	75,000	Professional Fees Working Capital Software Development Marketing	$ $ $ $	50,000 2,000 20,000 3,000
25,000,000 Units (50%)	$	250,000	$	50,000	$	200,000	Professional Fees Working Capital Software Development Marketing	$ $ $ $	50,000 20,000 120,000 10,000
37,500,000 Units (75%)	$	375,000	$	50,000	$	325,000	Professional Fees Working Capital Software Development Marketing	$ $ $ $	50,000 35,000 200,000 40,000
50,000,000 Units (maximum)	$	500,000	$	50,000	$	450,000	Professional Fees Working Capital Software Development Marketing	$ $ $ $	50,000 80,000 250,000 70,000

Name	Position Held with Our Company	Age	Date First Elected or Appointed
Matthew Zipchen	President, Chief Executive Officer, Chief Financial Officer, Secretary, Treasurer, and Director	35	January 6, 2011
Violetta Pioro	Vice President and Director	26	November 15, 2011

Name and Principal Position	Year	Salary ($)		Bonus ($)		Stock Awards ($)		Option Awards ($)		Non-Equity Incentive Plan Compensa- tion ($)		Nonqualified Deferred Compensation Earnings ($)		All Other Compensa- tion ($)		Total ($)
Matthew Zipchen President, Chief Executive Officer, Chief Financial Officer, Secretary, Treasurer, and Director	2012		-		-		-		-		-		-		-		-
Violetta Pioro Vice-President and Director	2012		-		-		-		-		-		-		-		-

Name and Principal Position	Year	Fees Earned of Paid in Cash ($)		Stock Awards ($)		Option Awards ($)		Non-Equity Incentive Plan Compensa- tion ($)		Nonqualified Deferred Compensation Earnings ($)		All Other Compensa- tion ($)		Total ($)
Matthew Zipchen President, Chief Executive Officer, Chief Financial Officer, Secretary, Treasurer, and Director	2012		-		-		-		-		-		-		-
Violetta Pioro Vice-President and Director	2012		-		-		-		-		-		-		-

Name and Address of Beneficial Owner	Title of Class	Amount and Nature of Beneficial Ownership		Percentage of Class(1)
Matthew Zipchen Unit #1610 100 Western Battery Rd. Toronto, Ontario Canada M6K 3S2	Common Stock	6,000,000	Direct	80%
Violetta Pioro 2008 Solar Place, Oshawa, ON Canada L1L 0A4	Common Stock	1,500,000	Direct	20%
Directors and Executive Officers (2 – as a group)	Common Stock	7,500,000		100%


	(i)	Any director or executive officer of our company;
	(ii)	Any person who beneficially owns, directly or indirectly, shares carrying more than 5% of the voting rights attached to our outstanding shares of common stock;
	(iii)	Any of our promoters and control persons; and
	(iv)	Any member of the immediate family (including spouse, parents, children, siblings and in- laws) of any of the foregoing persons.

SEC Registration Fee	$	57.30
Printing Expenses	$	7,000
Accounting/Administrative Fees and Expenses	$	15,000
Blue Sky Fees/Expenses		1,000
Legal Fees/Expenses	$	20,000
Transfer Agent Fees	$	5,000
Miscellaneous Expenses		2,000
Total	$	50,057.30

Exhibit Number		Description of Exhibits
3.1		Articles of Incorporation
3.2		Bylaws
5.1		Opinion of Anslow & Jaclin, LLP
23.1		Consent of MaloneBailey, LLP, Certified Public Accountants
23.2		Opinion of Anslow & Jaclin, LLP [incorporated by reference to Exhibit 5.1 herewith].

By:	/s/ Matthew Zipchen
	Matthew Zipchen President and Director Principal Executive Officer Principal Financial Officer Principal Accounting Officer

By:	/s/ Violetta Pioro
	Violetta Pioro Vice President and Director

Filed in the office of /s/ Ross Miller Ross Miller Secretary of State State of Nevada	Document Number 20110008947-52
	Filing Date and Time 01/06/2011 12:14 PM
	Entity Number E0007062011

1. Name of Corporation:	MEDIA MECHANICS, INC.

2. Registered Agent for Service of Process: (check only one box)	x Commercial Registered Agent: INCORP SERVICES, INC. Name o Noncommercial Registered Agent OR o Office or Position with Entity (name and address below) (name and address below)

	Name of Noncommercial Registered Agent OR Name of Title of Office or Other Position with Entity
		Nevada
	Street Address	City			Zip Code
		Nevada
	Mailing Address (if different from street address)	City			Zip Code

3. Authorized Stock: (Number of shares corporation is authorized to issue)	Number of shares With par value: 300,000,000	Par value Per share: $0.001		Number of shares Without par value: 0
4. Name & Addresses Of the Board of Directors/Trustees: (each Director/Trustee must be a natural person at least 18 years of age: attach additional pages if more than three directors/trustees
	1. MATTHEW ZIPCHEN - SEE ATTACHED
	Name
	2360 CORPORATE CIRCLE STE	HENDERSON	NV		89074-7722
	Street Address	City	State		Zip Code

	2.

	Street Address	City	State		Zip Code

	3.
	Name

	Street Address	City	State		Zip Code

5. Purpose: (optional –see Instructions)	The purpose of this corporation shall be:

6. Name, Address And Signature of Incorporator: (attach additional pages if more than one incorporator)
	INCORP SERVI - SEE ATTACHED	X /s/ INCORP SERVICES, INC.
	Name	Incorporator Signature


	2360 CORPORATE CIRCLE STE	HENDERSON	NV		89074-7722
	Address	City	State		Zip Code

7. Certificate of Acceptance of Appointment of Resident Agent:	I hereby accept appointment as Resident Agent for the above named entity.
	X /s/ INCORP SERVICES, INC.				1/6/2011
	Authorized Signature of Registered Agent of On Behalf of registered Agent Entity				Date

ENTITY NAME:		MEDIA MECHANICS, INC.

FOREIGN NAME TRANSLATION:		Not Applicable

PURPOSE:		Not Applicable

REGISTERED AGENT NAME:		INCORP SERVICES, INC.

STREET ADDRESS:		Not Applicable

MAILING ADDRESS:		Not Applicable

ADDITIONAL	Directors/Trustess
Name: MATTHEW ZIPCHEN Address: 2360 CORPORATE CIRCLE STE 400 City: HENDERSON State: NV ZIP Code: 89074-7722

ADDITIONAL	Incorporators
Name: INCORP SERVICES, INC. Address: 2360 CORPORATE CIRCLE STE 400 City: HENDERSON State: NV ZIP Code: 89074-7722