UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended June 30, 2019
or
¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number: 333-197692
| STAR ALLIANCE INTERNATIONAL CORP. |
| (Exact name of registrant as specified in its charter) |
| Nevada | 37-1757067 | |
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
5763 Corsa Avenue Suite 218
Westlake Village, CA 91362
(Address of principal executive offices)
310-571-0020
(Registrant’s telephone number)
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Name of each exchange on which registered |
| N/A | N/A |
Securities registered pursuant to Section 12(g) of the Exchange Act: Common Stock, $0.001 par value
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ¨ No x
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes x No ¨
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 ¨ No x
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 pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ¨ No x
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer | ¨ | Accelerated filer | ¨ |
| Non-accelerated filer | ¨ | Smaller reporting company | x |
| Emerging Growth Company | x | ||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes No x
APPLICABLE ONLY TO CORPORATE ISSUERS:
No market value has not been computed based upon the fact that no active trading data was available as of June 30, 2019.
Indicate the number of shares outstanding of each of the issuer’s classes of common stock as of the latest practicable date: 93,870,000 shares of $0.001 par value common stock outstanding as of January 9, 2020.
STAR ALLIANCE INTERNATIONAL CORP.
ANNUAL REPORT ON FORM 10-K
For the Fiscal Year Ended June 30, 2019
| i |
Star Alliance International Corp. (“the Company”, “we”, “us”) was originally incorporated with the name Asteriko Corp. in the State of Nevada on April 17, 2014 under the laws of the state of Nevada. Our prior business plans, which generated limited or no earnings, included interior decorating products, and a travel and tourism service.
On May 14, 2018, Richard Carey our President and Chairman of the Board, acquired 22,000,000 shares of common stock of the Company, representing 62.15% ownership of the Company which constitutes control. Mr. Carey accepted the positions of President and Chairman of the Board on the same day.
On May 17, 2018, Mr. Carey appointed Alexei Tchernov as CEO and Director, Franz Allmayer as Vice President and Director, John C. Baird as CFO and Director and Themis Glatman as Secretary and Director. Also see Note 4.
On May 22, 2019, the Board discussed the positions of the Directors and Officers. Mr. Tchernov resigned his position as CEO and Themis Glatman resigned as Company Secretary. The new appointments were made as follows:
| Richard Carey | CEO and Joint Chairman, Board member |
| John Baird | CFO and Joint Chairman, Board Member |
| James Baughman | President Operations |
| Alexei Tchernov | Executive Vice President Finance, Board Member |
| Franz Allmayer | Vice President Finance, Board Member |
| Themis Glatman | Treasurer, Board Member |
| Anthony Anish | Company Secretary, Board Member |
In August 14, 2018, the Company entered into an Exclusive Option Agreement (the “Agreement”) with Starving Lion, Inc. (“Lion”). Under the Agreement, the Company has been granted the exclusive option, for a period of six (6) months, to acquire the assets from Starving Lion, Inc. specified under the June 4, 2018 Letter of Intent. The assets pertain mainly to two mines located in Guatemala; one is a magnesium mine in El Progresso, and the other is a gold mine in Livingston.
The required purchase price for the Starving Lion, Inc. assets will be $1,000,000 cash, together with the issuance to Lion of new common and/or preferred stock to represent fifty-eight percent (58%) of the Company’s issued and outstanding common stock on a fully-diluted, post-closing basis. The Company decided not to proceed with this potential acquisition at this time.
On October 25, 2018, Star entered into a Letter of Intent (the “LOI”) with Troy Mining Corporation, a Nevada corporation (“Troy”) and its two majority shareholders and on March 25, 2019 and on August 5th this LOI was extended. Troy is the owner of 78 gold mining claims consisting of approximately 4800 acres, located east/southeast of El Portal, California, in Mariposa County. Troy also owns a production processing mill together with related equipment and buildings. On August 13th, 2019, the Company closed the transaction making the first payment on the acquisition of all the assets of Troy Mining Corporation.
The Company’s business focus will be the pursuit of mining and mining technology businesses. The Company acquired the assets of Troy Mining Corporation, its first mining assets, on August 13, 2019.
On June 12, 2019, the Board approved the issuance of 48 million shares of common stock to Richard Carey, reducing his loan by $48,000.
Employees
Management of the Company expect to use consultants, attorneys and accountants as necessary, and does not anticipate a need to engage any full-time employees so long as it is seeking and evaluating business opportunities. The need for employees and their availability will be addressed in connection with the decision whether or not to acquire or participate in specific business opportunities.
| 1 |
Smaller Reporting Company Status
We qualify as a “smaller reporting company” under Rule 12b-2 of the Exchange Act, which is defined as a company with a public equity float of less than $75 million. To the extent that we remain a smaller reporting company at such time as are no longer an emerging growth company, we will still have reduced disclosure requirements for our public filings, some of which are similar to those of an emerging growth company, including not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act and the reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements.
We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information required under this item.
Item 1B Unresolved Staff Comments
Not applicable
We currently do not own or rent any property.
Management is not aware of any legal proceedings contemplated by any governmental authority or any other party involving us or our properties. As of the date of this year-end report, no director, officer or affiliate is (i) a party adverse to us in any legal proceeding, or (ii) has an adverse interest to us in any legal proceedings. Management is not aware of any other legal proceedings pending or that have been threatened against us or our properties.
Item 4. Mine Safety Disclosures
Not applicable.
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Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.
Market Information
There is a limited public market for our common shares. Our common shares are not quoted on the OTC Bulletin Board at this time. Trading in stocks quoted on the OTC Bulletin Board is often thin and is characterized by wide fluctuations in trading prices due to many factors that may be unrelated to a company’s operations or business prospects. We cannot assure you that there will be a market in the future for our common stock.
OTC Bulletin Board securities are not listed or traded on the floor of an organized national or regional stock exchange. Instead, OTC Bulletin Board securities transactions are conducted through a telephone and computer network connecting dealers in stocks. OTC Bulletin Board issuers are traditionally smaller companies that do not meet the financial and other listing requirements of a regional or national stock exchange.
As of June 30, 2019, no shares of our common stock have been traded.
Number of Holders
As of June 30, 2019, the 83,450,000 issued and outstanding shares of common stock were held by a total of 35 shareholders of record.
Dividends
No cash dividends have been paid on our shares of common stock during the fiscal years ended June 30, 2019 and 2018. We have not paid any cash dividends since our inception and do not foresee declaring any cash dividends on our common stock in the foreseeable future.
Recent Sales of Unregistered Securities
During the year ended June 30, 2019, the Company sold 2,400,000 shares of common stock for total cash proceeds of $7,000. As of June 30, 2019, the shares have not yet been issued by the transfer agent and therefore have been credited to common stock to be issued.
Purchase of our Equity Securities by Officers and Directors
None.
Other Stockholder Matters
None.
Item 6. Selected Financial Data.
Not applicable.
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Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and the related notes and other financial information included elsewhere in this Form 10-K. Some of the information contained in this discussion and analysis or set forth elsewhere in this Form 10-K, including information with respect to our plans and strategy for our business and related financing, includes forward-looking statements that involve risks and uncertainties.
Our cash balance was $471 as of June 30, 2019. We believe our cash balance is not sufficient to fund our limited levels of operations for any period of time. We have been utilizing funds borrowed from our Chairman. The Chairman has no commitment, arrangement or legal obligation to advance or loan funds to the company. The borrowing is non-interest-bearing, unsecured, and due on demand.
Our independent registered public accountants have issued a going concern opinion. This means that there is substantial doubt that we can continue as an on-going business for the next twelve months unless we obtain additional capital to pay our bills. The accompanying financial statements have been prepared assuming that the Company continues as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business. As shown in the accompanying financial statements, the Company has accumulated deficit of $775,454 and negative working capital of $133,715 as of June 30, 2019, and net loss of $141,882 and no cash flows in operating activities for the year ended June 30, 2019. Due to these conditions, it raises substantial doubt about its ability to continue as a going concern.
We are an “emerging growth company” as defined in the JOBS Act, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies” including, but not limited to: not required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act; reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements; exemptions from the requirements of holding an annual non-binding advisory vote on executive compensation and nonbinding stockholder approval of any golden parachute payments not previously approved. In addition, Section 107 of the JOBS Act also provides that an “emerging growth company” can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an “emerging growth company” can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We are choosing to “opt out” of such extended transition period, and as a result, we will comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. Section 107 of the JOBS Act provides that our decision to opt out of the extended transition period for complying with new or revised accounting standards is irrevocable.
Results of Operations for the years ended June 30, 2019 and 2018
Operating expenses
General and administrative expenses were $27,617 for the year ended June 30, 2019, compared to $6,382 for the year ended June 30, 2018, an increase of $21,235. The increase is due to an increase in filing fees and consulting expense.
Professional fees were $63,534 for the year ended June 30, 2019, compared to $87,422 for the year ended June 30, 2018, a decrease of $23,888. Professional fees consist mainly of legal, accounting and audit expense. The decrease is due to a decrease in legal fees.
Other income (expense)
For the year ended June 30, 2019, we had interest expense of $2,731 and a loss on conversion of debt of $48,000, compared to interest expense of $132 for the year ended June 30, 2018. Interest expense has increased as a result of the two notes payable that were added to the Company’s liabilities.
Net Loss
Net loss for the year ended June 30, 2019 was $141,882 compared to $93,936 for the year ended June 30, 2018.
| 4 |
Plan of Operations
We expect that working capital requirements will continue to be funded through borrowing from related parties. Subsequent to the year end the Company acquired the mining claims and equipment assets of Troy Mining Corporation. We continue to search for other new business opportunities in the mining arena.
Off Balance Sheet Arrangements
We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.
Material Commitments
As of the date of this Annual Report, we do not have any material commitments.
Purchase of Significant Equipment
We do not intend to purchase any significant equipment during the next twelve months.
Liquidity and Capital Resources
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business. As shown in the accompanying financial statements, the Company has an accumulated deficit of $775,454 and negative working capital of $133,715 as of June 30, 2019. For the year ended June 30, 2019 the Company had a net loss of $141,882 with $44,910 of cash used in operating activities. Due to these conditions, it raises substantial doubt about the Company’s ability to continue as a going concern.
Net cash used in operating activities was $44,910 for the year ended June 30, 2019 as compared to the net cash used in operating activities of $0 for the year ended June 30, 2018. The increase in net cash used in operating activities from 2018 to 2019 is because expenses were paid directly by related parties in 2018.
Net cash provided by financing activities was $45,081 and $300 for the years ended June 30, 2019 and 2018, respectively.
Over the next twelve months, we expect our principle source of liquidity will be dependent on borrowings from related parties.
Going Concern Consideration
Our auditors have issued a “going concern” opinion, meaning that there is substantial doubt if we can continue as an on-going business for the next twelve months unless we obtain additional capital. The Company’s cash position may not be sufficient to support its daily operations.
Limited operating history and need for additional capital
There is no historical financial information about us upon which to base an evaluation of our performance. We are in start-up stage operations and have not generated any significant revenues. We cannot guarantee we will be successful in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources and possible cost overruns due to price and cost increases in services and products.
Item 7A. Quantitative and Qualitative Disclosures about Market Risk
Not applicable to smaller reporting companies.
| 5 |
Item 8. Financial Statements and Supplementary Data
| 6 |
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
AJ Robbins CPA, LLC Certified Public Accountants
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Stockholders Star Alliance International Corp.
Opinion on the Financial Statements
We have audited the accompanying balance sheet of Star Alliance International Corp (the Company) as of June 30, 2019 and the related consolidated statements of operations, stockholders’ equity (deficit) and cash flows for the year then ended and the related notes (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of June 30, 2019, and the results of its operations and its cash flows for the year then ended in conformity with accounting principles generally accepted in the United States of America.
Going concern uncertainty
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in note 3 to the financial statements, the Company has an accumulated deficit of $775,454 and negative working capital of $133,715 as of June 30, 2019. For the year ended June 30, 2019 the Company had a net loss of $141,882. These factors create an uncertainty as to the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in note 3. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Emphasis of Matters-Significant Related Party Transactions
The Company has had significant transactions and relationships with related parties, including the Company’s Co-Chairman, which are described in the financial statements. Transactions involving related parties cannot be presumed to be carried out on an arm's length basis, as the requisite conditions of competitive, free market dealings may not exist.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, 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.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
/s/ AJ Robbins CPA, LLC
We have served as the Company’s auditor since 2019.
Denver, Colorado December 28, 2019
| F-1 |
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders and Board of Directors of
Star Alliance International Corp.
Opinion on the Financial Statements
We have audited the accompanying balance sheet of Star Alliance International Corp. as of June 30, 2018, and the related statement of operations, changes in stockholders’ deficit, and cash flows for the year then ended, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of June 30, 2018, and the results of its operations and its cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America.
Going Concern Matter
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 3 to the financial statements, the Company has suffered recurring losses from operations and has a net capital deficiency that raises substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 3. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit we are required to obtain an understanding of internal control over financial reporting 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.
Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.
/s/ MaloneBailey, LLP
www.malonebailey.com
We served as the Company's auditor from 2017 to 2018.
Houston, Texas
February 14, 2019
| F-2 |
STAR ALLIANCE INTERNATIONAL CORP.
| June 30, | ||||||||
| 2019 | 2018 | |||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash | $ | 471 | $ | 300 | ||||
| Total assets | 471 | 300 | ||||||
| LIABILITIES AND STOCKHOLDERS’ DEFICIT | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 32,692 | $ | – | ||||
| Accrued expenses | 2,863 | 20,182 | ||||||
| Note payable | 20,000 | – | ||||||
| Note payable – former related party | 32,000 | 32,000 | ||||||
| Related party advance | 3,980 | 300 | ||||||
| Due to former related party | 42,651 | 42,651 | ||||||
| Total current liabilities | 134,186 | 95,133 | ||||||
| Total liabilities | 134,186 | 95,133 | ||||||
| COMMITMENTS AND CONTINGENCIES (see footnotes) | ||||||||
| Stockholders’ deficit: | ||||||||
| Preferred stock, $0.001 par value, 25,000,000 authorized, none issued and outstanding | – | – | ||||||
| Series B preferred stock, $0.001 par value, 1,900,000 authorized, none issued and outstanding | – | – | ||||||
| Common stock, $0.001 par value, 175,000,000 shares authorized, 83,450,000 and 35,450,000 shares issued and outstanding as of June 30, 2019 and 2018, respectively | 83,450 | 35,450 | ||||||
| Additional paid-in capital | 551,289 | 503,289 | ||||||
| Common stock to be issued | 7,000 | – | ||||||
| Accumulated deficit | (775,454 | ) | (633,572 | ) | ||||
| Total stockholders’ deficit | (133,715 | ) | (94,833 | ) | ||||
| Total liabilities and stockholders’ deficit | $ | 471 | $ | 300 | ||||
The accompanying notes are an integral part of these financial statements.
| F-3 |
STAR ALLIANCE INTERNATIONAL CORP.
| For the Years Ended June 30, | ||||||||
| 2019 | 2018 | |||||||
| Operating expenses: | ||||||||
| General and administrative | $ | 27,617 | $ | 6,382 | ||||
| Professional fees | 63,534 | 87,422 | ||||||
| Total operating expenses | 91,151 | 93,804 | ||||||
| Loss from operations | (91,151 | ) | (93,804 | ) | ||||
| Other expense: | ||||||||
| Loss on conversion – related party | (48,000 | ) | – | |||||
| Interest expense | (2,731 | ) | (132 | ) | ||||
| Total other expense | (50,731 | ) | (132 | ) | ||||
| Loss before provision for income taxes | (141,882 | ) | (93,936 | ) | ||||
| Provision for income taxes | – | – | ||||||
| Net loss | $ | (141,882 | ) | $ | (93,936 | ) | ||
| Net loss per common share - basic and diluted | $ | (0.00 | ) | $ | (0.00 | ) | ||
| Weighted average common shares outstanding – basic and diluted | 37,817,123 | 35,400,000 | ||||||
The accompanying notes are an integral part of these financial statements.
| F-4 |
STAR ALLIANCE INTERNATIONAL CORP.
STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIT
FOR THE YEARS ENDED JUNE 30, 2019 AND 2018
| Common Stock | Additional Paid-in | Common Stock To Be | Accumulated | |||||||||||||||||||||
| Shares | Amount | Capital | Issued | Deficit | Total | |||||||||||||||||||
| Balance, June 30, 2017 | 35,400,000 | $ | 35,400 | $ | 478,339 | $ | – | $ | (539,636 | ) | $ | (25,897 | ) | |||||||||||
| Common stock issued for services | 50,000 | 50 | 24,950 | – | – | 25,000 | ||||||||||||||||||
| Net loss | – | – | – | – | (93,936 | ) | (93,936 | ) | ||||||||||||||||
| Balance, June 30, 2018 | 35,450,000 | 35,450 | 503,289 | – | (633,572 | ) | (94,833 | ) | ||||||||||||||||
| Common stock issued to convert related party advances | 48,000,000 | 48,000 | 48,000 | – | – | 96,000 | ||||||||||||||||||
| Common stock sold | 7,000 | 7,000 | ||||||||||||||||||||||
| Net loss | – | – | – | – | (141,882 | ) | (141,882 | ) | ||||||||||||||||
| Balance, June 30, 2019 | 83,450,000 | 83,450 | $ | 551,289 | $ | 7,000 | $ | (775,454 | ) | $ | (133,715 | ) | ||||||||||||
The accompanying notes are an integral part of these financial statements.
| F-5 |
STAR ALLIANCE INTERNATIONAL CORP.
| For the Years Ended June 30, | ||||||||
| 2019 | 2018 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
| Net loss | $ | (141,882 | ) | $ | (93,936 | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Stock-based compensation | – | 25,000 | ||||||
| Loss on conversion of debt – related party | 48,000 | – | ||||||
| Changes in assets and liabilities: | ||||||||
| Accounts payable | 43,192 | – | ||||||
| Accrued expenses | 5,781 | 68,936 | ||||||
| Net cash used in operating activities | (44,909 | ) | – | |||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
| Proceeds of borrowings from a related party | 72,085 | 300 | ||||||
| Repayment to related party | (34,005 | ) | – | |||||
| Proceeds from the sale of common stock | 7,000 | – | ||||||
| Net cash provided by financing activities | 45,080 | 300 | ||||||
| Net increase in cash | 171 | 300 | ||||||
| Cash at the beginning of year | 300 | – | ||||||
| Cash at the end of year | $ | 471 | $ | 300 | ||||
| SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ||||||||
| Interest paid | $ | – | $ | – | ||||
| Income taxes paid | $ | – | $ | – | ||||
| NON-CASH TRANSACTIONS: | ||||||||
| Operating expenses paid directly by a former related party | $ | – | $ | 42,651 | ||||
| Note payable issued for settlement of accrued expense | $ | – | $ | 32,000 | ||||
| Related party advance converted to common shares | $ | 48,000 | $ | – | ||||
| Operating expenses paid directly by a related party | $ | 13,600 | $ | – | ||||
| Note issued to settle unpaid legal fees | $ | 20,000 | $ | – | ||||
The accompanying notes are an integral part of these financial statements.
| F-6 |
Star Alliance International Corp.
June 30, 2019
NOTE 1 – NATURE OF BUSINESS
Star Alliance International Corp. (“the Company”, “we”, “us”) was originally incorporated with the name Asteriko Corp. in the State of Nevada on April 17, 2014 under the laws of the state of Nevada, for the purpose of acquiring and developing gold mining as well as certain other mining properties worldwide.
NOTE 2 – SIGNIFICANT AND CRITICAL ACCOUNTING POLICIES AND PRACTICES
Basis of Presentation
The accompanying financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the rules of the Securities and Exchange Commission (“SEC”).
Use of Estimates
The preparation of financial statements in conformity with 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.
Cash equivalents
The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. There were no cash equivalents for the years ended June 30, 2019 or 2018.
Stock-based Compensation
The Company records stock-based compensation in accordance with FASB ASC Topic 718, “Compensation – Stock Compensation.” FASB ASC Topic 718 requires companies to measure compensation cost for stock-based employee compensation at fair value at the grant date and recognize the expense over the employee’s requisite service period. The Company recognizes in the statement of operations the grant-date fair value of stock options and other equity-based compensation issued to employees and non-employees. The Company accounts for stock-based compensation in accordance with the provision of ASC 505-50, Equity Based Payments to Non-Employees, which requires that such equity instruments are recorded at their fair value on the measurement date. The measurement of stock-based compensation is subject to periodic adjustment as the underlying equity instruments vest.
Fair value of financial instruments
The Company follows paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and paragraph 820-10-35-37 of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 establishes a framework for measuring fair value in accounting principles generally accepted in the United States of America (U.S. GAAP), and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below:
Level 1 - Quoted market prices available in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.
Level 2 - Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs).
| F-7 |
Level 3 - Unobservable inputs that reflect our assumptions about the assumptions that market participants would use in pricing the asset or liability.
The Company’s financial instruments are consisted principally of accrued expenses and short term debt. The carrying amounts of such financial instruments in the accompanying balance sheets approximate their fair values due to their relatively short-term nature.
Income Tax Provision
The Company follow ASC 740-10-30, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are based on the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the fiscal year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the fiscal 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 the Statements of Income in the period that includes the enactment date.
On December 22, 2017, the Tax Cuts and Jobs Act (TCJA) was signed into law by the President of the United States. TCJA is a tax reform act that among other things, reduced corporate tax rates to 21 percent effective January 1, 2018. FASB ASC 740, Income Taxes, requires deferred tax assets and liabilities to be adjusted for the effect of a change in tax laws or rates in the year of enactment, which is the year in which the, change was signed into law. Accordingly, the Company adjusted its deferred tax assets and liabilities at June 30, 2019, using the new corporate tax rate of 21 percent. See Note 7.
The Company adopted ASC 740-10-25 (“ASC 740-10-25”) with regard to uncertainty income taxes. ASC 740-10-25 addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under ASC 740-10-25, we may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. ASC 740-10-25 also provides guidance on derecognition, classification, interest and penalties on income taxes, and accounting in interim periods and requires increased disclosures. We had no material adjustments to our liabilities for unrecognized income tax benefits according to the provisions of ASC 740-10-25.
Net income (loss) per common share
Net loss per common share is computed pursuant to section 260-10-45 of the FASB Accounting Standards Codification. Basic net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock and potentially dilutive outstanding shares of common stock during the period to reflect the potential dilution that could occur from common shares issuable through contingent share arrangements, stock options and warrants. There were no potentially dilutive common shares outstanding for the years ended June 30, 2019 and June 30, 2018.
Recently Issued Accounting Pronouncements
In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business. This ASU clarifies the definition of a business when evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. This new guidance will be effective for annual reporting periods beginning after December 15, 2017, including interim periods within those periods. The adoption of this ASU has had no material impact on the Company’s financial statements and disclosures.
In January 2017, the FASB issued ASU 2017-04, Intangibles—Goodwill and Other (Topic 350). This ASU simplifies the subsequent measurement of goodwill by eliminating the second step of the goodwill impairment test, which required computing the implied fair value of goodwill. Under the amendments in this update, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. This new guidance will be effective January 1, 2020. The Company is currently in the process of evaluating the potential effect that the adoption of this standard will have on its financial position and results of operations.
| F-8 |
In May 2017, the FASB issued ASU 2017-09, Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting. This ASU clarifies an entity’s ability to modify the terms or conditions of a share-based payment award presented. An entity should account for the effects of a modification unless all the following are met: the fair value of the modified award has not changed from the fair value on the date of issuance; the vesting conditions of the modified award are the same as the vesting conditions of the original award immediately before the original award is modified; and, the classification of the modified award as an equity instrument or a liability instrument is the same as the classification of the original award immediately before the original award is modified. This new guidance will be effective for annual reporting periods beginning after December 15, 2017, including interim periods within those periods. The adoption of this ASU has had no material impact on the Company’s financial statements and disclosures.
In July 2017, the FASB issued ASU 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception. This ASU clarifies the recognition, measurement, and effect on earnings per share of certain freestanding equity-classified financial instruments that include down round features affect entities that present earnings per share in accordance with the guidance in Topic 260, Earnings Per Share. When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. The amendments also clarify existing disclosure requirements for equity-classified instruments. This new guidance will be effective for annual reporting periods beginning after December 15, 2018, including interim periods within those periods. The Company adopted this ASU and it did not have a material impact on the Company’s financial statements.
In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). The ASU requires that a lessee recognize the assets and liabilities that arise from operating leases. A lessee should recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. This new guidance will be effective for annual reporting periods beginning after December 15, 2018, including interim periods within those annual reporting periods, and early adoption is permitted. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The Company adopted this ASU and it did not have a material impact on the Company’s results of operations.
In May 2014, the Financial Accounting Standards Board (FASB) issued ASU 2014-09, Revenue from Contracts with Customers, to establish ASC Topic 606, (ASC 606). ASU 2014-09 supersedes the revenue recognition requirements in ASC Topic 605, Revenue Recognition and most industry-specific guidance throughout the Industry Topics of the Codification. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance includes a five-step framework that requires an entity to: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when the entity satisfies a performance obligation. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The Company adopted this ASU and it did not have a material impact on the Company’s results of operations.
The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.
NOTE 3 – GOING CONCERN
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business. As shown in the accompanying financial statements, the Company has an accumulated deficit of $775,454 and negative working capital of $133,715 as of June 30, 2019. For the year ended June 30, 2019 the Company had a net loss of $141,882. Due to these conditions, it raises substantial doubt about the Company’s ability to continue as a going concern.
The Company is attempting to commence operations and generate sufficient revenue; however, the Company’s cash position may not be sufficient to support its daily operations. While the Company believes in the viability of its strategy to commence operations and generate sufficient revenue and in its ability to raise additional funds, there can be no assurances to that effect. The ability of the Company to continue as a going concern is dependent upon its ability to further implement its business plan and generate sufficient revenue and its ability to raise additional funds. The financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that may result should the Company be unable to continue as a going concern.
| F-9 |
NOTE 4 – RELATED PARTY TRANSACTIONS
On May 14, 2018, pursuant to an agreement by and between Richard Carey, the Company’s new President and Chairman of the Board, and Kido, Mr. Richard Carey acquired 22,000,000 shares of common stock of the Company owned by Kido, representing 62.15% ownership of the Company which constitutes control. Mr. Richard Carey accepted the positions of President and Chairman of the Board on the same day.
In June 2018, Richard Carey, the Company’s Chairman, advanced the Company $300 to open a bank account. During the year ended June 30, 2019, Mr. Carey advanced the Company an additional $72,085, of which $34,005 was repaid. On June 12, 2019, Mr. Carey converted $48,000 of the amount due to him into 48,000,000 shares of common stock. The stock was fair valued at $0.002 per share by an independent valuation firm resulting in a loss on conversion of $48,000. As of June 30, 2019 and 2018, the balance due to Mr. Carey is $3,980 and $300, respectively. The advances are unsecured, non-interest bearing and due on demand.
Mr. Carey is using his personal office space at no cost to the Company.
NOTE 5 – COMMON STOCK
On June 30, 2018, the Company granted 50,000 shares of common stock for services rendered as of June 30, 2018. The shares were valued at $0.50 for total non-cash compensation expense of $25,000. As of June 30, 2018 the shares had not yet been issued by the transfer agent.
During the year ended June 30, 2019, the Company sold 2,400,000 shares of common stock for total cash proceeds of $7,000. As of June 30, 2019, the shares have not yet been issued by the transfer agent and therefore have been credited to common stock to be issued.
Refer to Note 4 for shares issued to a related party.
NOTE 6 – NOTE PAYABLE
As of June 30, 2019 and 2018, the Company owed Kok Chee Lee, the former CEO and Director of the Company, $42,651 and $42,651, respectively for operating expenses he paid on behalf of the Company during the year ended June 30, 2018. The borrowing is unsecured, non-interest-bearing and due on demand.
On June 1, 2018, the Company executed a promissory note in the amount of $32,000 with the former Secretary of the Board for $30,128 of accrued expenses for services previously provided and an additional $1,872 for services rendered. The note is unsecured, bears interest at 5% per annum and matures on December 1, 2018. As of June 30, 2019 and 2018, there is $1,732 and $132, respectively, of accrued interest on the note. The note is past due and in default.
On October 15, 2018, the Company executed a promissory note for $20,000, for amounts previously accrued and payable to the Company’s former attorney. The note bears interest at 8% and is due on October 15, 2019. As of June 30, 2019, there is $1,131 of accrued interest due on the note.
NOTE 7 – INCOME TAX
Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carry forwards 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. The Company has evaluated Staff Accounting Bulletin No. 118 regarding the impact of the decreased tax rates of the Tax Cuts & Jobs Act. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The U.S. federal income tax rate of 21% is being used due to the new tax law recently enacted.
| F-10 |
Net deferred tax assets consist of the following components as of June 30:
| 2019 | 2018 | |||||||
| Deferred Tax Assets: | ||||||||
| NOL Carryover | $ | 152,765 | $ | 127,772 | ||||
| Less valuation allowance | (152,765 | ) | (127,772 | ) | ||||
| Net deferred tax assets | $ | – | $ | – | ||||
The income tax provision differs from the amount of income tax determined by applying the U.S. federal income tax rate to pretax income from continuing operations for the period ended June 30, due to the following:
At June 30, 2019, the Company had net operating loss carry forwards of approximately $634,000 that maybe offset against future taxable income. No tax benefit has been reported in the June 30, 2019 or 2018 financial statements since the potential tax benefit is offset by a valuation allowance of the same amount.
On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cut and Jobs Act (the “Tax Act”). The Tax Act establishes new tax laws that affects 2018 and future years, including a reduction in the U.S. federal corporate income tax rate to 21% effective January 1, 2018.
Due to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carry forwards for federal income tax reporting purposes are subject to annual limitations. Should a change in ownership occur, net operating loss carry forwards may be limited as to use in future years.
ASC Topic 740 provides guidance on the accounting for uncertainty in income taxes recognized in a company’s financial statements. Topic 740 requires a company to determine whether it is more likely than not that a tax position will be sustained upon examination based upon the technical merits of the position. If the more-likely-than-not threshold is met, a company must measure the tax position to determine the amount to recognize in the financial statements.
The Company includes interest and penalties arising from the underpayment of income taxes in the statements of operations in the provision for income taxes. As of June 30, 2019, the Company had no accrued interest or penalties related to uncertain tax positions.
With few exceptions, the Company is no longer subject to U.S. federal, state and local income tax examinations by tax authorities for years before 2013.
NOTE 8 – SUBSEQUENT EVENTS
1. Acquisition of Troy Mining Claims
On August 13, 2019, The Company closed an Asset Purchase Agreement (the “APA”) with Troy Mining Corporation (“Troy”). Under the APA, we acquired 78 gold mining claims consisting of approximately 4,800 acres, located east/southeast of El Portal, California, in Mariposa County, together with all of Troy’s rights to related equipment and buildings currently located on the mining claims. In exchange for the mining claims and related assets, we:
| · | Agreed to issue 1,900,000 shares of a new class of preferred stock designated Series B Preferred Stock; and |
| · | Agreed to make total cash payments in the amount of $500,000 under a Promissory Note (the “Purchase Note”) |
Under the Purchase Note, we paid $50,000 at the time of the closing, and are required to pay an additional $50,000 within sixty days of the closing, and $25,000 every other month thereafter, with the entire remaining amount due no later than March 31, 2020. In the event of default under the Purchase Note, all assets acquired under the APA will be forfeited back to Troy.
| F-11 |
The 1,900,000 shares of Series B Preferred Stock designated and issued as part of the purchase price will be convertible into common stock on a 2:1 basis beginning 60 days from their date of issuance and will cast two votes per share on all matters submitted to a vote of our shareholders. If converted, all shares of Series B Preferred Stock must be converted in one tranche. Within 60 days of the closing, we are required under the APA to file a registration statement registering the re-sale of the shares of common stock issuable upon conversion of the Series B Preferred Stock.
On October 9, 2019, the parties have agreed to extend the date for filing the registration statement relating to the preferred shares of STAL to be issued to the Troy shareholders and that would in turn extend the date that the shares would become free trading. This extension will be for 150 days for filing the registration statement and obtaining approval for the shares to become free trading. All the remaining terms included in the contract will remain the same.
2. In order to pay the initial $50,000 required under the APA and the Purchase Note, the Company obtained funding under a Convertible Promissory Note in the amount of $50,000 issued to a private investor. The Convertible Promissory Note accrues interest at an annual rate of 10% and is due and payable in full in 60 days. The Convertible Promissory Note is convertible to shares of our common stock at a price of $0.05 per share.
3. In July 2019, the Company issued 6,000,000 shares of common stock to various members of the Board. All but 250,000 common shares were issued in lieu of Directors Fees.
4. On August 1, 2019, employment agreements for Richard Carey, John Baird and Anthony Anish were signed providing for annual salaries of $120,000 per annum for Richard Carey and $60,000 for John Baird and Anthony Anish.
5. In October 2019, the approximately 7 mile road from the main highway to our mining claims has been cleared and is now passable.
6. On October 7, 2019, a new $250,000 Convertible Promissory Note with initial funding of $50,000 was issued to a private investor. The Convertible Promissory Note accrues interest at an annual rate of 10% and is due and payable in full in 60 days. The Convertible Promissory Note is convertible to shares of our common stock at a price of $0.05 per share.
7. On October 9, 2019, a contract extension was agreed between Star Alliance International Corp. and Troy Mining Corporation The agreement gives the Company 150 days to file an S-1 registration statement and obtain approval for the shares that are to be issued to the Troy shareholders to become free trading.
| F-12 |
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
None
Item 9A. Controls and Procedures
Management’s Conclusions Regarding Effectiveness of Disclosure Controls and Procedures
As required by Rule 13a-15 under the Securities Exchange Act of 1934, as of June 30, 2019, the end of the year covered by this report, our management concluded its evaluation of the effectiveness of the design and operation of our disclosure controls and procedures.
Disclosure controls and procedures refer to controls and other procedures designed to ensure that information required to be disclosed in the reports we file or submit under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC and that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply its judgment in evaluating and implementing possible controls and procedures.
Our management does not expect that our disclosure controls and procedures will prevent all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be 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, 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. The design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.
With respect to the fiscal year ending June 30, 2019, under the supervision and with the participation of our management, we conducted an evaluation of the effectiveness of the design and operations of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) promulgated under the Securities Exchange Act of 1934. Based upon our evaluation regarding the fiscal year ending June 30, 2019, our management, including our principal executive officer and principal financial officer, has concluded that our disclosure controls and procedures were ineffective.
Management’s Report on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act. Our management is also required to assess and report on the effectiveness of our internal control over financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act of 2002 (“Section 404”). Management assessed the effectiveness of our internal control over financial reporting as of June 30, 2019. In making this assessment, we used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control - Integrated Framework. Based on that evaluation, our management concluded that our internal controls over financial reporting were not effective as of such date to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms. We note the following deficiencies that management believes to be material weaknesses:
| · | The Company’s lack of segregation of duties. | |
| · | Lack of an audit committee and independent directors | |
| · | Management has not established appropriate and rigorous procedures for evaluating internal controls over financial reporting. Due to limited resources and lack of segregation of duties, documentation of the limited control structure has not been accomplished. | |
| · | We employ policies and procedures for reconciliation of the financial statements and note disclosures, however, these processes are not appropriately documented. | |
| · | Management has not established methodical and consistent data back-up procedures to ensure loss of data will not occur. |
| 7 |
The Company is evaluating the necessity of implementing an independent board of directors to rectify these weaknesses.
A material weakness (within the meaning of PCAOB Auditing Standard No. 5) 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. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control over financial reporting that is less severe than a material weakness, yet important enough to merit attention by those responsible for oversight of the company’s financial reporting.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies and procedures may deteriorate.
This annual report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit us to provide only management’s report in this annual report.
Changes in Internal Controls
There have been no changes in our internal control over financial reporting during the quarter ended June 30, 2019 that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.
We have no other information to disclose that was required to be disclosed in a report on Form 8-K during the fourth quarter of fiscal year ended June 30, 2019 that was not reported.
| 8 |
Item 10. Directors, Executive Officers and Corporate Governance
| Name | Age | Position | ||
| Richard Carey | 80 | Chief Executive Officer, Co Chairman of the Board | ||
| John C. Baird | 75 | Chief Financial Officer, Co Chairman of the Board | ||
| Alexei Tchernov | 57 | Executive Vice-President Finance, Director | ||
| James Baughman | 63 | Vice President Operations | ||
| Franz Allmayer | 32 | Vice President Finance, Director | ||
| Themis Glatman | 61 | Treasurer, Director | ||
| Anthony L. Anish | 71 | Company Secretary, Director |
Biographical Information and Background of officer and director
Richard Carey – Chief Executive Officer and Co- Chairman, appointed May 22, 2019,
Richard Carey is our President. Mr. Carey began his career in 1958 when he received congressional appointment to the US Naval Academy as the son of Congressional Medal of Honor recipient Charles Francis Carey Jr. Upon honorable discharge from the US Navy in 1964, Mr. Carey began a career in finance as a NYLIC underwriter for New York Life. From 1967 to 1973, Mr. Carey worked as a stockbroker and principal of a brokerage firm. In 1973 he began structuring oil and gas limited partnerships for developmental drilling programs. These programs included hundreds of successful oil and gas wells, and a lucrative Geo-Thermal project in Colorado as a general partner with AMEX (an American Stock Exchange listed company).
In the subsequent 40 years, Mr. Carey has founded and co-founded multiple companies in a wide range of industries including diamond and gold mining operations, oil and gas exploration, energy resellers, entertainment, specialty finance and tax offset programs. With his broad experience and an extensive personal and business network, Mr. Carey’s financial acumen has added significant value to every project in which he has participated. With his unique understanding of the diversity of business structures and an ongoing commitment to innovate and adapt to new practices, he continues to build upon the depth of knowledge and success gained throughout his career.
John C. Baird – Chief Financial Officer and Co- Chairman, appointed May 22, 2019
John C. Baird is Chief Financial Officer and Chairman of our Board of Directors. Mr. Baird comes to Star Alliance International Corp. International with a background in private equity, finance, information systems, and marketing both domestically and internationally. He is an officer and co-founder of an internet-based medical informatics company, which has leading teaching hospitals and chains as customers and some of America’s premier investors as shareholders. More recently he cofounded a medical diagnostics company with leading physicians and scientists. Previously he worked in the investment banking division of Credit Suisse where he managed private equity. Mr. Baird was the president of First Shanghai Corporation, a merchant bank in the People’s Republic of China. Earlier in his career he was a Regional Manager and Director, Market Development Division, American Stock Exchange, and an Associate with Morgan Stanley as well as two other Wall St. firms.
Mr. Baird has experience as an entrepreneur and has headed several firms in the high-tech arena. He was educated in Canada (Economics and Commerce) and his education in the United States includes a mid-career management course at Harvard and MIT and graduation from the New York Institute of Finance. Mr. Baird is published, has several patents, and served as a pilot with the Royal Canadian Air Force. Until recently he served as Chairman of a 501(c)(3) non-profit organization.
Alexei Tchernov – Executive Vice-President Finance, appointed May 22, 2019
Alexei Tchernov is our Chief Executive Officer, and in this capacity acts as a direct liaison between management and the Board. He is responsible for creating, planning, implementing and integrating the strategic direction of the Company and as such responsible for the company operations, marketing, strategy, financing, and creation of company culture. Mr. Tchernov has twenty-five years of financial, investment, and significant polymetallic development project experience domestically and internationally. Mr. Tchernov spent fourteen years with the IFC Metropol group of companies as Acting Head of Corporate Finance and Head of Investment Projects. Previously he served as Financial Director of Neptune Pacific. He began his career as an associate with The Boston Consulting Group and later as a financial analyst with the United Financial Group division of Deutsche Bank. Mr. Tchernov received his Ph.D. in computational mathematics and cybernetics, his M.S. in applied mathematics, his Law Degree from Moscow State University, and his MBA from Southern Methodist University in Dallas TX.
| 9 |
Franz Allmayer - Vice President Finance, appointed May 22, 2019
Franz Allmayer as Vice President Mergers & Acquisitions is responsible for sourcing and evaluating investment opportunities including joint ventures and negotiating and closing investments. Mr. Allmayer has held positions with companies such as SIMGO Mobile since September 2015 as their Business Developer and Global Advisor, the Clinton Health Initiative from November 2014 to September 2015 as a consultant, LMM General trading from October 2015 to October 2016 as a Strategic Research & Development Innovation Scout and Vamed Engineering GmbH & CO KG from April 2012 to September 2014 as a Project Engineer. Mr. Allmayer graduated in September 2014 from the London School of Economics and Political Science with a Master of Science degree in Health Policy, Planning and Financing with merit. In addition, he has a Bachelor of Science degree in Biomedical Engineering with distinction from the University of Applied Sciences Techniku, Vienna.
Themis Glatman - Treasurer, appointed May 22, 2019
Mrs. Glatman was born in Brazil where she achieved an athletic scholarship that allowed her to come to the United States where she attended Brigham Young University in Utah, studying Chemical Engineering for three years. She is fluent in English, Spanish, Portuguese with some French and Italian. Having moved to Los Angeles in 1981 she pursued a seventeen-year career in construction including commercial, residential, multi-family as well as smaller remodeling projects. Remodeling included acquisitions of homes for her own remodeling projects. She is well versed in reading blueprints and understands architectural and engineering requirements of projects from excavation, grading to paving and concrete work through final finishes.
Anthony L. Anish Corporate Secretary, appointed May 22, 2019
Mr. Anish, as Corporate Secretary, is responsible for board minutes and implementing board decisions, advising directors, handling share issuances and transactions, legal requirements, auditors, lawyers, tax advisers, bankers and shareholders on governance issues, and ensuring compliance of relevant laws and regulatory matters. Mr. Anish serves as a principal officer of M Line Holdings, Inc. and Square Chain Corporation where he is responsible for meeting all the SEC requirements. Previously, he successfully founded and expanded the London-based Anish and Co., chartered accountants, Mr. Anish sold his interest to two junior partners to join as CFO his accounting client, Performance Tire, Ltd. A year later he joined Performance Tire, Inc. where he led an expansion into the U.S. that took sales from $2MM to $28MM in 2 years. He later purchased the company's 9 retail stores, which he later sold to return to his accounting and finance background. Mr. Anish provided business finance for companies through equipment leasing and asset-based lending from its Orange County office. Prior to joining M Line he consulted on a number of reverse mergers, provided business finance to private and public companies, and assisted taking a private company public through the full registration process. Mr. Anish received his Chartered Accounting degree after articling with Percy Phillips and Co., a London based Chartered Accounting firm.
James Baughman, Vice President Operations, appointed May 22, 2019
James Baughman, an economic geologist and mining executive, is our President and responsible for assisting the CEO in creating, planning, implementing and integrating the strategic direction of the Company and as such shares with the CEO responsibilities for the company operations, marketing, strategy, financing, and creation of company culture. Mr. Baughman has over thirty years of progressive experience in advancing gold, silver, and base metal projects from grassroots to advance stage projects. He has held senior positions (i.e., Chief Geologist, Chairman, President, Acting CFO, Chief Operating Officer) in both private and publicly traded mining and mineral exploration companies during his 30-year industry career. Mr. Baughman was on the successful Greens Creek discovery team and has lead exploration and development projects throughout the Western Hemisphere. Mr. Baughman was CEO of High Plains Uranium that was sold for US $55 Million in 2006. Mr. Baughman is a registered member of the Society of Mining, Metallurgy, Exploration and a member of the Society of Economic Geologists. Mr. Baughman received a Bachelor of Science degree in Geology in 1983 from the University of Wyoming and is a registered professional geologist (P. Geo) in the State of Wyoming. Mr. Baughman is a Registered Member of the Society of Mining, Metallurgy, and Exploration (SME) and a Qualified Person (QP) on the Toronto Stock Exchange (TSX) and Australian Stock Exchange (ASX).
Term of Office
Our directors are appointed for a one-year term to hold office until the next annual general meeting of our shareholders or until removed from office in accordance with our bylaws. Our officers are appointed by our board of directors and hold office until removed by the board.
| 10 |
Family Relationships
There are no family relationships between or among the directors, executive officers, or persons nominated or chosen by us to become directors or executive officers.
Involvement in Certain Legal Proceedings
No executive officer or director has been involved in the last ten years in any of the following:
| · | Any bankruptcy petition filed by or against any business or property of such person, or of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time; |
| · | Any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses); |
| · | Being subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; |
| · | Being found by a court of competent jurisdiction (in a civil action), the SEC or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated; |
| · | Being the subject of or a party to any judicial or administrative order, judgment, decree or finding, not subsequently reversed, suspended or vacated relating to an alleged violation of any federal or state securities or commodities law or regulation, or any law or regulation respecting financial institutions or insurance companies, including but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order, or any law or regulation prohibiting mail, fraud, wire fraud or fraud in connection with any business entity; or |
| · | Being the subject of or a party to any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act, any registered entity (as defined in Section 1(a) (29) of the Commodity Exchange Act), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member. |
Board Committees and Audit Committee Financial Expert
We do not currently have a standing audit, nominating or compensation committee of the Board of Directors, or any committee performing similar functions. Our Board of Directors performs the functions of audit, nominating and compensation committees. As of the date of this annual report, no member of our Board of Directors qualifies as an “audit committee financial expert” as defined in Item 407(d) (5) of Regulation S-K promulgated under the Securities Act.
Director Nominations
As of June 30, 2019, we did not affect any material changes to the procedures by which our shareholders may recommend nominees to our Board of Directors. We have not established formal procedures by which security holders may recommend nominees to the Company’s Board of Directors.
Code of Ethics
We have adopted a code of ethics that applies to our principal executive officers, principal financial officer, principal accounting officer or controller, or persons performing similar functions. A copy of our code of ethics may be obtained free of charge by contacting us at the address or telephone number listed on the cover page hereof.
| 11 |
Item 11. Executive Compensation
| Name and Principal Position | Year | Salary (US$) | Bonus (US$) | Stock Awards (US$) | Option Awards (US$) | Non-Equity Incentive Plan Compensation (US$) | Nonqualified Deferred Compensation Earnings (US$) | All Other Compensation (US$) | Total (US$) | ||||||||||||||||
| Richard Carey (CEO) | 2019 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||
| 2018 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||
| John C. Baird (CFO) | 2019 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||
| 2018 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||
| Alexei Tchernov (Executive VP Finance) | 2019 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||
| 2018 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||
| Franz Allmayer (Vice President Finance) | 2019 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||
| 2018 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||
| Themis Glatman (Treasurer) | 2019 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||
| 2018 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||
| Anthony L. Anish (Company Secretary) | 2019 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||
| James Baughman (Vice President Operations) | 2019 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||
| Eng Wah Kung (CFO, resigned May 16, 2018) | 2018 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||
| Kok Chee Lee (CEO, resigned January 17, 2018) | 2018 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||
Grants of Plan-Based Awards Table
None of our named executive officers received any grants of stock, option awards or other plan-based awards during the year ended June 30, 2019 or 2018. The Company has no activity with respect to these awards.
Options Exercised and Stock Vested Table
None of our named executive officers exercised any stock options, and no restricted stock units, if any, held by our named executive officers vested during the year ended June 30, 2019 or 2018. The Company has no activity with respect to these awards.
| 12 |
Outstanding Equity Awards at Fiscal Year-End Table
None of our named executive officers had any outstanding stock or option awards as of June 30, 2019 that would be compensatory to the officer. The Company has not issued any awards to its named executive officers. The Company and its Board of Directors may grant awards as it sees fit to its employees as well as key consultants.
Compensation of Directors
During the fiscal year ended June 30, 2019, we did not provide compensation to any of our directors for serving as our director. We currently have no formal plan for compensating our directors for their services in their capacity, although we may elect to issue stock options to such persons from time to time. Directors are entitled to reimbursement for reasonable travel and other out-of-pocket expenses incurred in connection with attendance at meetings of our board of directors. Our board of directors may award special remuneration to any director undertaking any special services on our behalf other than services ordinarily required of a director.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
The following table sets forth, as of October 7, 2019, the beneficial ownership of our common stock by each executive officer and director, by each person known by us to beneficially own more than 5% of our common stock and by the executive officers and directors as a group. Except as otherwise indicated, all shares are owned directly, and the percentage shown is based on 92,720,000 shares of common stock issued and outstanding.
| Title of Class | Name of Beneficial Owner | Amount and Nature of Beneficial | Percentage | ||||
| Common Stock | Richard Carey | 66,500,000 | 71.72% | ||||
| Common Stock | John C. Baird | 2,500,000 | 2.70% | ||||
| Common Stock | Alexei Tchernov | 500,000 | 0.54% | ||||
| Common Stock | Franz Allmayer | 250,000 | 0.27% | ||||
| Common Stock | Themis Gladman | 250,000 | 0.27% | ||||
| Common Stock | Anthony L. Anish | 1,000,000 | 0.08% | ||||
| Common Stock | Total all executive officers and directors (7 persons) | 71,000,000 | 76.57% | ||||
Item 13. Certain Relationships and Related Transactions, and Director Independence
As of June 30, 2019, the amount due to a related party was $42,651 as operating expenses of $42,651 were paid by Kok Chee Lee, CEO and Director of the Company during the year ended June 30, 2018, on behalf of the Company. The borrowing is unsecured, non-interest-bearing and due on demand.
On May 14, 2018, pursuant to an agreement by and between Richard Carey, the Company’s new President and Chairman of the Board, and Kido, Mr. Richard Carey acquired 22,000,000 shares of common stock of the Company owned by Kido, representing 62.15% ownership of the Company which constitutes control. Mr. Richard Carey accepted the positions of President and Chairman of the Board on the same day.
In June 2018, Richard Carey, the Company’s Chairman, advanced the Company $300 to open a bank account. During the year ended June 30, 2019, Mr. Carey advanced the Company an additional $72,086, of which $34,005 was repaid. On June 12, 2019, Mr. Carey converted $48,000 of the amount due to him into 48,000,000 shares of common stock. As of June 30, 2019, the balance due to Mr. Carey is $3,980. The advance is unsecured, non-interest bearing and due on demand.
Mr. Carey is using his personal office space at no cost to the Company.
Item 14. Principal Accounting Fees and Services
Audit Fees
During fiscal year ended June 30, 2019, we incurred $49,500 in fees to our principal independent accountants for professional services rendered in connection with the audit of our financial statements and for the reviews of our financial statements. Our previous auditors MaloneBailey charged fees of $27,500 for the period July 1, 2018 through June 30, 2019 which included fees for the quarterly reviews of quarter 2 and 3 of fiscal year 2018. The Audit fees incurred during the fiscal year ended June 30, 2018 were $15,200.
Tax Fees
During the years ended June 30, 2019 and 2018, our principal accountant did not render services to us for tax compliance, tax advice or tax planning.
All Other Fees
During the year ended June 30, 2019 and 2018, there were no fees billed for products and services provided by the principal accountant other than those set forth above.
Currently, we have no independent audit committee. Our full board of directors’ functions as our audit committee and is comprised of one director who is not considered to be “independent” in accordance with the requirements of Rule 10A-3 under the Exchange Act. Our audit committee’s pre-approval policies and procedures described in paragraph (c)(7)(i) of Rule 2-01 of Regulation S-X were that the audit committee pre-approve all accounting related activities prior to the performance of any services by any accountant or auditor.
| 13 |
Item 15. Exhibits, Financial Statement Schedules
The following exhibits are filed as part of this Annual Report.
| Exhibit | Exhibit Description | |
| 3.1 | Articles of Incorporation (1) | |
| 3.2 | Bylaws(1) | |
| 10.1 | Exclusive Option Agreement with Starving Lion, Inc. (2) | |
| 31.1 | Certification by the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act | |
| 31.2 | Certification by the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act | |
| 32.1 | Certification by the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act | |
| 32.1 | Certification by the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act | |
| 101.INS | XBRL Instance Document | |
| 101.SCH | XBRL Taxonomy Extension Schema Document | |
| 101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document | |
| 101.DEF | XBRL Taxonomy Extension Definition Linkbase Document | |
| 101.LAB | XBRL Taxonomy Extension Label Linkbase Document | |
| 101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document |
_____________
(1) Incorporated by reference to Registration Statement on Form S-1 filed July 20, 2014
(2) Incorporated by reference to Current Report on Form 8-K filed August 17, 2018
| 14 |
Pursuant to the requirements of Section 13 or 15(d) 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.
| Star Alliance International Corp. | ||
| By: | /s/ Richard Carey | |
| Richard Carey | ||
| Chief Executive Officer, Joint Chairmen | ||
| Date | January 23, 2020 | |
| By: | /s/ John C. Baird | |
| John C. Baird | ||
| Chief Financial Officer, Joint Chairmen | ||
| Date | January 23, 2020 | |
| By: | /s/ Alexei Tchernov | |
| Alexei Tchernov | ||
| Director | ||
| Date | January 23, 2020 | |
| By: | /s/ Franz Allmayer | |
| Franz Allmayer | ||
| Director | ||
| Date: | January 23, 2020 | |
| 15 |
EXHIBIT 31.1
CERTIFICATION OF THE CHIEF FINANCIAL OFFICER PURSUANT TO RULE 13a-14
I, Richard Carey, certify that:
| 1. | I have reviewed this yearly report on Form 10-K of Star Alliance International Corp. |
| 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. | I am 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 my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me 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 my 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. | I have disclosed, based on my 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: January 23, 2020 | |
| /s/ Richard Carey | |
| Richard Carey | |
| Chief Executive Officer |
EXHIBIT 31.2
CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER PURSUANT TO RULE 13a-14
I, John C. Baird, certify that:
| 1. | I have reviewed this yearly report on Form 10-K of Star Alliance International Corp. |
| 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. | I am 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 my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me 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 my 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. | I have disclosed, based on my 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: January 23, 2020 | |
| /s/ John C. Baird | |
| John C. Baird | |
| Chief Financial Officer |
EXHIBIT 32.1
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 Annual Report of Star Alliance International Corp. (“the Company”) on Form 10-K for the year ended June 30, 2019 as filed with the Securities and Exchange Commission on the date of hereof (the “Report”), we, Alexei Tchernov, Chief Executive Officer of the Company, and John C. Baird, Chief Financial Officer, certify pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to the best of our knowledge and belief:
| (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. |
| By: | Richard Carey | |
| Chief Executive Officer | ||
| (Principal Executive Officer) | ||
| Date: January 23, 2020 | ||
| By: | John C. Baird | |
| Chief Financial Officer | ||
| (Principal Financial Officer) | ||
| Date: January 23, 2020 | ||
2. Significant And Critical Accounting Policies and Practices (Details Narrative) - USD ($) |
12 Months Ended | |
|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
|
| Accounting Policies [Abstract] | ||
| Cash equivalents | $ 0 | $ 0 |
| Potentially antidilutive shares | 0 | 0 |
7. Income Tax |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||
| Income Tax Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||
| Income Tax |
NOTE 7 – INCOME TAX
Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carry forwards 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. The Company has evaluated Staff Accounting Bulletin No. 118 regarding the impact of the decreased tax rates of the Tax Cuts & Jobs Act. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The U.S. federal income tax rate of 21% is being used due to the new tax law recently enacted.
Net deferred tax assets consist of the following components as of June 30:
The income tax provision differs from the amount of income tax determined by applying the U.S. federal income tax rate to pretax income from continuing operations for the period ended June 30, due to the following:
At June 30, 2019, the Company had net operating loss carry forwards of approximately $634,000 that maybe offset against future taxable income. No tax benefit has been reported in the June 30, 2019 or 2018 financial statements since the potential tax benefit is offset by a valuation allowance of the same amount.
On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cut and Jobs Act (the “Tax Act”). The Tax Act establishes new tax laws that affects 2018 and future years, including a reduction in the U.S. federal corporate income tax rate to 21% effective January 1, 2018.
Due to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carry forwards for federal income tax reporting purposes are subject to annual limitations. Should a change in ownership occur, net operating loss carry forwards may be limited as to use in future years.
ASC Topic 740 provides guidance on the accounting for uncertainty in income taxes recognized in a company’s financial statements. Topic 740 requires a company to determine whether it is more likely than not that a tax position will be sustained upon examination based upon the technical merits of the position. If the more-likely-than-not threshold is met, a company must measure the tax position to determine the amount to recognize in the financial statements.
The Company includes interest and penalties arising from the underpayment of income taxes in the statements of operations in the provision for income taxes. As of June 30, 2019, the Company had no accrued interest or penalties related to uncertain tax positions.
With few exceptions, the Company is no longer subject to U.S. federal, state and local income tax examinations by tax authorities for years before 2013. |
|||||||||||||||||||||||||||||||||||||||||||||
Cover - USD ($) |
12 Months Ended | |
|---|---|---|
Jun. 30, 2019 |
Jan. 09, 2020 |
|
| Cover [Abstract] | ||
| Document Type | 10-K | |
| Amendment Flag | false | |
| Document Period End Date | Jun. 30, 2019 | |
| Document Fiscal Period Focus | FY | |
| Document Fiscal Year Focus | 2019 | |
| Current Fiscal Year End Date | --06-30 | |
| Entity File Number | 333-197692 | |
| Entity Registrant Name | Star Alliance International Corp. | |
| Entity Central Index Key | 0001614556 | |
| Entity Incorporation, State or Country Code | NV | |
| Entity Well-known Seasoned Issuer | No | |
| Entity Voluntary Filers | No | |
| Entity Current Reporting Status | Yes | |
| Entity Interactive Data Current | Yes | |
| Entity Filer Category | Non-accelerated Filer | |
| Entity Small Business | true | |
| Entity Emerging Growth Company | true | |
| Elected Not To Use the Extended Transition Period | false | |
| Entity Shell Company | false | |
| Entity Public Float | $ 0 | |
| Entity Common Stock, Shares Outstanding | 93,870,000 |
Statements of Changes in Stockholders' Equity (Deficit) - USD ($) |
Common Stock |
Additional Paid-In Capital |
Common Stock To Be Issued |
Accumulated Deficit |
Total |
|---|---|---|---|---|---|
| Beginning balance, shares at Jun. 30, 2017 | 35,400,000 | ||||
| Beginning balance, value at Jun. 30, 2017 | $ 35,400 | $ 478,339 | $ 0 | $ (539,636) | $ (25,897) |
| Common stock issued for services, shares | 50,000 | ||||
| Common stock issued for services, value | $ 50 | 24,950 | 25,000 | ||
| Net loss | (93,936) | (93,936) | |||
| Ending balance, shares at Jun. 30, 2018 | 35,450,000 | ||||
| Ending balance, value at Jun. 30, 2018 | $ 35,450 | 503,289 | 0 | (633,572) | (94,833) |
| Common stock issued to convert related party advances, shares | 48,000,000 | ||||
| Common stock issued to convert related party advances, other | $ 48,000 | 48,000 | 96,000 | ||
| Common stock sold | 7,000 | 7,000 | |||
| Net loss | (141,882) | (141,882) | |||
| Ending balance, shares at Jun. 30, 2019 | 83,450,000 | ||||
| Ending balance, value at Jun. 30, 2019 | $ 83,450 | $ 551,289 | $ 7,000 | $ (775,454) | $ (133,715) |
3. Going Concern |
12 Months Ended |
|---|---|
Jun. 30, 2019 | |
| Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
| Going Concern |
NOTE 3 – GOING CONCERN
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business. As shown in the accompanying financial statements, the Company has an accumulated deficit of $775,454 and negative working capital of $133,715 as of June 30, 2019. For the year ended June 30, 2019 the Company had a net loss of $141,882. Due to these conditions, it raises substantial doubt about the Company’s ability to continue as a going concern.
The Company is attempting to commence operations and generate sufficient revenue; however, the Company’s cash position may not be sufficient to support its daily operations. While the Company believes in the viability of its strategy to commence operations and generate sufficient revenue and in its ability to raise additional funds, there can be no assurances to that effect. The ability of the Company to continue as a going concern is dependent upon its ability to further implement its business plan and generate sufficient revenue and its ability to raise additional funds. The financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that may result should the Company be unable to continue as a going concern. |
6. Note Payable (Details Narrative) - USD ($) |
3 Months Ended | 11 Months Ended | ||
|---|---|---|---|---|
Oct. 15, 2018 |
Jun. 01, 2018 |
Jun. 30, 2019 |
Jun. 30, 2018 |
|
| Kok Chee Lee [Member] | ||||
| Note payable | $ 42,651 | $ 42,651 | ||
| Former Secretary of the Board [Member] | ||||
| Debt face amount | $ 32,000 | |||
| Debt stated interest rate | 5.00% | |||
| Debt maturity date | Dec. 01, 2018 | |||
| Accrued interest | 1,732 | $ 132 | ||
| Note in default | 32,000 | |||
| Former Attorney [Member] | ||||
| Debt face amount | $ 20,000 | |||
| Debt stated interest rate | 8.00% | |||
| Debt maturity date | Oct. 15, 2019 | |||
| Accrued interest | $ 1,131 |
2. Significant And Critical Accounting Policies and Practices |
12 Months Ended |
|---|---|
Jun. 30, 2019 | |
| Accounting Policies [Abstract] | |
| Significant And Critical Accounting Policies and Practices |
NOTE 2 – SIGNIFICANT AND CRITICAL ACCOUNTING POLICIES AND PRACTICES
Basis of Presentation The accompanying financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the rules of the Securities and Exchange Commission (“SEC”).
Use of Estimates The preparation of financial statements in conformity with 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.
Cash equivalents The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. There were no cash equivalents for the years ended June 30, 2019 or 2018.
Stock-based Compensation The Company records stock-based compensation in accordance with FASB ASC Topic 718, “Compensation – Stock Compensation.” FASB ASC Topic 718 requires companies to measure compensation cost for stock-based employee compensation at fair value at the grant date and recognize the expense over the employee’s requisite service period. The Company recognizes in the statement of operations the grant-date fair value of stock options and other equity-based compensation issued to employees and non-employees. The Company accounts for stock-based compensation in accordance with the provision of ASC 505-50, Equity Based Payments to Non-Employees, which requires that such equity instruments are recorded at their fair value on the measurement date. The measurement of stock-based compensation is subject to periodic adjustment as the underlying equity instruments vest.
Fair value of financial instruments The Company follows paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and paragraph 820-10-35-37 of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 establishes a framework for measuring fair value in accounting principles generally accepted in the United States of America (U.S. GAAP), and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below:
Level 1 - Quoted market prices available in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.
Level 2 - Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs).
Level 3 - Unobservable inputs that reflect our assumptions about the assumptions that market participants would use in pricing the asset or liability.
The Company’s financial instruments are consisted principally of accrued expenses and short term debt. The carrying amounts of such financial instruments in the accompanying balance sheets approximate their fair values due to their relatively short-term nature.
Income Tax Provision The Company follow ASC 740-10-30, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are based on the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the fiscal year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the fiscal 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 the Statements of Income in the period that includes the enactment date.
On December 22, 2017, the Tax Cuts and Jobs Act (TCJA) was signed into law by the President of the United States. TCJA is a tax reform act that among other things, reduced corporate tax rates to 21 percent effective January 1, 2018. FASB ASC 740, Income Taxes, requires deferred tax assets and liabilities to be adjusted for the effect of a change in tax laws or rates in the year of enactment, which is the year in which the, change was signed into law. Accordingly, the Company adjusted its deferred tax assets and liabilities at June 30, 2019, using the new corporate tax rate of 21 percent. See Note 7.
The Company adopted ASC 740-10-25 (“ASC 740-10-25”) with regard to uncertainty income taxes. ASC 740-10-25 addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under ASC 740-10-25, we may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. ASC 740-10-25 also provides guidance on derecognition, classification, interest and penalties on income taxes, and accounting in interim periods and requires increased disclosures. We had no material adjustments to our liabilities for unrecognized income tax benefits according to the provisions of ASC 740-10-25.
Net income (loss) per common share Net loss per common share is computed pursuant to section 260-10-45 of the FASB Accounting Standards Codification. Basic net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock and potentially dilutive outstanding shares of common stock during the period to reflect the potential dilution that could occur from common shares issuable through contingent share arrangements, stock options and warrants. There were no potentially dilutive common shares outstanding for the years ended June 30, 2019 and June 30, 2018.
Recently Issued Accounting Pronouncements In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business. This ASU clarifies the definition of a business when evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. This new guidance will be effective for annual reporting periods beginning after December 15, 2017, including interim periods within those periods. The adoption of this ASU has had no material impact on the Company’s financial statements and disclosures.
In January 2017, the FASB issued ASU 2017-04, Intangibles—Goodwill and Other (Topic 350). This ASU simplifies the subsequent measurement of goodwill by eliminating the second step of the goodwill impairment test, which required computing the implied fair value of goodwill. Under the amendments in this update, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. This new guidance will be effective January 1, 2020. The Company is currently in the process of evaluating the potential effect that the adoption of this standard will have on its financial position and results of operations.
In May 2017, the FASB issued ASU 2017-09, Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting. This ASU clarifies an entity’s ability to modify the terms or conditions of a share-based payment award presented. An entity should account for the effects of a modification unless all the following are met: the fair value of the modified award has not changed from the fair value on the date of issuance; the vesting conditions of the modified award are the same as the vesting conditions of the original award immediately before the original award is modified; and, the classification of the modified award as an equity instrument or a liability instrument is the same as the classification of the original award immediately before the original award is modified. This new guidance will be effective for annual reporting periods beginning after December 15, 2017, including interim periods within those periods. The adoption of this ASU has had no material impact on the Company’s financial statements and disclosures.
In July 2017, the FASB issued ASU 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception. This ASU clarifies the recognition, measurement, and effect on earnings per share of certain freestanding equity-classified financial instruments that include down round features affect entities that present earnings per share in accordance with the guidance in Topic 260, Earnings Per Share. When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. The amendments also clarify existing disclosure requirements for equity-classified instruments. This new guidance will be effective for annual reporting periods beginning after December 15, 2018, including interim periods within those periods. The Company adopted this ASU and it did not have a material impact on the Company’s financial statements.
In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). The ASU requires that a lessee recognize the assets and liabilities that arise from operating leases. A lessee should recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. This new guidance will be effective for annual reporting periods beginning after December 15, 2018, including interim periods within those annual reporting periods, and early adoption is permitted. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The Company adopted this ASU and it did not have a material impact on the Company’s results of operations.
In May 2014, the Financial Accounting Standards Board (FASB) issued ASU 2014-09, Revenue from Contracts with Customers, to establish ASC Topic 606, (ASC 606). ASU 2014-09 supersedes the revenue recognition requirements in ASC Topic 605, Revenue Recognition and most industry-specific guidance throughout the Industry Topics of the Codification. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance includes a five-step framework that requires an entity to: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when the entity satisfies a performance obligation. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The Company adopted this ASU and it did not have a material impact on the Company’s results of operations.
The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations. |
Statements of Operations - USD ($) |
12 Months Ended | |
|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
|
| Operating expenses: | ||
| General and administrative | $ 27,617 | $ 6,382 |
| Professional fees | 63,534 | 87,422 |
| Total operating expenses | 91,151 | 93,804 |
| Loss from operations | (91,151) | (93,804) |
| Other expense: | ||
| Loss on conversion – related party | (48,000) | 0 |
| Interest expense | (2,731) | (132) |
| Total other expense | (50,731) | (132) |
| Loss before provision for income taxes | (141,882) | (93,936) |
| Provision for income taxes | 0 | 0 |
| Net loss | $ (141,882) | $ (93,936) |
| Net loss per common share - basic and diluted | $ (0.00) | $ (0.00) |
| Weighted average common shares outstanding – basic and diluted | 37,817,123 | 35,400,000 |
5. Common Stock (Details Narrative) - USD ($) |
12 Months Ended | |
|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
|
| Common stock issued for services, value | $ 25,000 | |
| Stock issued new, value | $ 7,000 | |
| Common Stock [Member] | ||
| Common stock issued for services, shares | 50,000 | |
| Common stock issued for services, value | $ 25,000 | |
| Stock to be issued, shares | 2,400,000 | 50,000 |
| Stock issued new, shares | 2,400,000 | |
| Stock issued new, value | $ 7,000 | |
7. Income Tax (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||
| Income Tax Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of deferred tax assets |
|
|||||||||||||||||||||||||||||||||||||||||||||
6. Note Payable |
12 Months Ended |
|---|---|
Jun. 30, 2019 | |
| Debt Disclosure [Abstract] | |
| Note Payable |
NOTE 6 – NOTE PAYABLE
As of June 30, 2019 and 2018, the Company owed Kok Chee Lee, the former CEO and Director of the Company, $42,651 and $42,651, respectively for operating expenses he paid on behalf of the Company during the year ended June 30, 2018. The borrowing is unsecured, non-interest-bearing and due on demand.
On June 1, 2018, the Company executed a promissory note in the amount of $32,000 with the former Secretary of the Board for $30,128 of accrued expenses for services previously provided and an additional $1,872 for services rendered. The note is unsecured, bears interest at 5% per annum and matures on December 1, 2018. As of June 30, 2019 and 2018, there is $1,732 and $132, respectively, of accrued interest on the note. The note is past due and in default.
On October 15, 2018, the Company executed a promissory note for $20,000, for amounts previously accrued and payable to the Company’s former attorney. The note bears interest at 8% and is due on October 15, 2019. As of June 30, 2019, there is $1,131 of accrued interest due on the note. |
7. Income Tax (Details - Deferred taxes) - USD ($) |
Jun. 30, 2019 |
Jun. 30, 2018 |
|---|---|---|
| Income Tax Disclosure [Abstract] | ||
| Deferred NOL carryover | $ 152,765 | $ 127,772 |
| Less valuation allowance | (152,765) | (127,772) |
| Net deferred tax assets | $ 0 | $ 0 |
3. Going Concern (Details Narrative) - USD ($) |
12 Months Ended | |
|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
|
| Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
| Accumulated deficit | $ (775,454) | $ (633,572) |
| Working capital | (133,715) | |
| Net loss | $ (141,882) | $ (93,936) |
8. Subsequent Events |
12 Months Ended | ||||||
|---|---|---|---|---|---|---|---|
Jun. 30, 2019 | |||||||
| Subsequent Events [Abstract] | |||||||
| Subsequent Events |
NOTE 8 – SUBSEQUENT EVENTS
1. Acquisition of Troy Mining Claims
On August 13, 2019, The Company closed an Asset Purchase Agreement (the “APA”) with Troy Mining Corporation (“Troy”). Under the APA, we acquired 78 gold mining claims consisting of approximately 4,800 acres, located east/southeast of El Portal, California, in Mariposa County, together with all of Troy’s rights to related equipment and buildings currently located on the mining claims. In exchange for the mining claims and related assets, we:
Under the Purchase Note, we paid $50,000 at the time of the closing, and are required to pay an additional $50,000 within sixty days of the closing, and $25,000 every other month thereafter, with the entire remaining amount due no later than March 31, 2020. In the event of default under the Purchase Note, all assets acquired under the APA will be forfeited back to Troy.
The 1,900,000 shares of Series B Preferred Stock designated and issued as part of the purchase price will be convertible into common stock on a 2:1 basis beginning 60 days from their date of issuance and will cast two votes per share on all matters submitted to a vote of our shareholders. If converted, all shares of Series B Preferred Stock must be converted in one tranche. Within 60 days of the closing, we are required under the APA to file a registration statement registering the re-sale of the shares of common stock issuable upon conversion of the Series B Preferred Stock.
On October 9, 2019, the parties have agreed to extend the date for filing the registration statement relating to the preferred shares of STAL to be issued to the Troy shareholders and that would in turn extend the date that the shares would become free trading. This extension will be for 150 days for filing the registration statement and obtaining approval for the shares to become free trading. All the remaining terms included in the contract will remain the same.
2. In order to pay the initial $50,000 required under the APA and the Purchase Note, the Company obtained funding under a Convertible Promissory Note in the amount of $50,000 issued to a private investor. The Convertible Promissory Note accrues interest at an annual rate of 10% and is due and payable in full in 60 days. The Convertible Promissory Note is convertible to shares of our common stock at a price of $0.05 per share.
3. In July 2019, the Company issued 6,000,000 shares of common stock to various members of the Board. All but 250,000 common shares were issued in lieu of Directors Fees.
4. On August 1, 2019, employment agreements for Richard Carey, John Baird and Anthony Anish were signed providing for annual salaries of $120,000 per annum for Richard Carey and $60,000 for John Baird and Anthony Anish.
5. In October 2019, the approximately 7 mile road from the main highway to our mining claims has been cleared and is now passable.
6. On October 7, 2019, a new $250,000 Convertible Promissory Note with initial funding of $50,000 was issued to a private investor. The Convertible Promissory Note accrues interest at an annual rate of 10% and is due and payable in full in 60 days. The Convertible Promissory Note is convertible to shares of our common stock at a price of $0.05 per share.
7. On October 9, 2019, a contract extension was agreed between Star Alliance International Corp. and Troy Mining Corporation The agreement gives the Company 150 days to file an S-1 registration statement and obtain approval for the shares that are to be issued to the Troy shareholders to become free trading. |
4. Related Party Transactions |
12 Months Ended |
|---|---|
Jun. 30, 2019 | |
| Related Party Transactions [Abstract] | |
| Related Party Transactions |
NOTE 4 – RELATED PARTY TRANSACTIONS
On May 14, 2018, pursuant to an agreement by and between Richard Carey, the Company’s new President and Chairman of the Board, and Kido, Mr. Richard Carey acquired 22,000,000 shares of common stock of the Company owned by Kido, representing 62.15% ownership of the Company which constitutes control. Mr. Richard Carey accepted the positions of President and Chairman of the Board on the same day.
In June 2018, Richard Carey, the Company’s Chairman, advanced the Company $300 to open a bank account. During the year ended June 30, 2019, Mr. Carey advanced the Company an additional $72,085, of which $34,005 was repaid. On June 12, 2019, Mr. Carey converted $48,000 of the amount due to him into 48,000,000 shares of common stock. The stock was fair valued at $0.002 per share by an independent valuation firm resulting in a loss on conversion of $48,000. As of June 30, 2019 and 2018, the balance due to Mr. Carey is $3,980 and $300, respectively. The advances are unsecured, non-interest bearing and due on demand.
Mr. Carey is using his personal office space at no cost to the Company. |
2. Significant And Critical Accounting Policies and Practices (Policies) |
12 Months Ended |
|---|---|
Jun. 30, 2019 | |
| Accounting Policies [Abstract] | |
| Basis of Presentation | Basis of Presentation The accompanying financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the rules of the Securities and Exchange Commission (“SEC”). |
| 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 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. |
| Cash equivalents | Cash equivalents The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. There were no cash equivalents for the years ended June 30, 2019 or 2018. |
| Stock-based Compensation | Stock-based Compensation The Company records stock-based compensation in accordance with FASB ASC Topic 718, “Compensation – Stock Compensation.” FASB ASC Topic 718 requires companies to measure compensation cost for stock-based employee compensation at fair value at the grant date and recognize the expense over the employee’s requisite service period. The Company recognizes in the statement of operations the grant-date fair value of stock options and other equity-based compensation issued to employees and non-employees. The Company accounts for stock-based compensation in accordance with the provision of ASC 505-50, Equity Based Payments to Non-Employees, which requires that such equity instruments are recorded at their fair value on the measurement date. The measurement of stock-based compensation is subject to periodic adjustment as the underlying equity instruments vest. |
| Fair value of financial instruments | Fair value of financial instruments The Company follows paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and paragraph 820-10-35-37 of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 establishes a framework for measuring fair value in accounting principles generally accepted in the United States of America (U.S. GAAP), and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below:
Level 1 - Quoted market prices available in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.
Level 2 - Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs).
Level 3 - Unobservable inputs that reflect our assumptions about the assumptions that market participants would use in pricing the asset or liability.
The Company’s financial instruments are consisted principally of accrued expenses and short term debt. The carrying amounts of such financial instruments in the accompanying balance sheets approximate their fair values due to their relatively short-term nature. |
| Income Tax Provision | Income Tax Provision The Company follow ASC 740-10-30, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are based on the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the fiscal year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the fiscal 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 the Statements of Income in the period that includes the enactment date.
On December 22, 2017, the Tax Cuts and Jobs Act (TCJA) was signed into law by the President of the United States. TCJA is a tax reform act that among other things, reduced corporate tax rates to 21 percent effective January 1, 2018. FASB ASC 740, Income Taxes, requires deferred tax assets and liabilities to be adjusted for the effect of a change in tax laws or rates in the year of enactment, which is the year in which the, change was signed into law. Accordingly, the Company adjusted its deferred tax assets and liabilities at June 30, 2019, using the new corporate tax rate of 21 percent. See Note 7.
The Company adopted ASC 740-10-25 (“ASC 740-10-25”) with regard to uncertainty income taxes. ASC 740-10-25 addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under ASC 740-10-25, we may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. ASC 740-10-25 also provides guidance on derecognition, classification, interest and penalties on income taxes, and accounting in interim periods and requires increased disclosures. We had no material adjustments to our liabilities for unrecognized income tax benefits according to the provisions of ASC 740-10-25. |
| Net income (loss) per common share | Net income (loss) per common share Net loss per common share is computed pursuant to section 260-10-45 of the FASB Accounting Standards Codification. Basic net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock and potentially dilutive outstanding shares of common stock during the period to reflect the potential dilution that could occur from common shares issuable through contingent share arrangements, stock options and warrants. There were no potentially dilutive common shares outstanding for the years ended June 30, 2019 and June 30, 2018. |
| Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business. This ASU clarifies the definition of a business when evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. This new guidance will be effective for annual reporting periods beginning after December 15, 2017, including interim periods within those periods. The adoption of this ASU has had no material impact on the Company’s financial statements and disclosures.
In January 2017, the FASB issued ASU 2017-04, Intangibles—Goodwill and Other (Topic 350). This ASU simplifies the subsequent measurement of goodwill by eliminating the second step of the goodwill impairment test, which required computing the implied fair value of goodwill. Under the amendments in this update, an entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. This new guidance will be effective January 1, 2020. The Company is currently in the process of evaluating the potential effect that the adoption of this standard will have on its financial position and results of operations.
In May 2017, the FASB issued ASU 2017-09, Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting. This ASU clarifies an entity’s ability to modify the terms or conditions of a share-based payment award presented. An entity should account for the effects of a modification unless all the following are met: the fair value of the modified award has not changed from the fair value on the date of issuance; the vesting conditions of the modified award are the same as the vesting conditions of the original award immediately before the original award is modified; and, the classification of the modified award as an equity instrument or a liability instrument is the same as the classification of the original award immediately before the original award is modified. This new guidance will be effective for annual reporting periods beginning after December 15, 2017, including interim periods within those periods. The adoption of this ASU has had no material impact on the Company’s financial statements and disclosures.
In July 2017, the FASB issued ASU 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception. This ASU clarifies the recognition, measurement, and effect on earnings per share of certain freestanding equity-classified financial instruments that include down round features affect entities that present earnings per share in accordance with the guidance in Topic 260, Earnings Per Share. When determining whether certain financial instruments should be classified as liabilities or equity instruments, a down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. The amendments also clarify existing disclosure requirements for equity-classified instruments. This new guidance will be effective for annual reporting periods beginning after December 15, 2018, including interim periods within those periods. The Company adopted this ASU and it did not have a material impact on the Company’s financial statements.
In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). The ASU requires that a lessee recognize the assets and liabilities that arise from operating leases. A lessee should recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. This new guidance will be effective for annual reporting periods beginning after December 15, 2018, including interim periods within those annual reporting periods, and early adoption is permitted. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The Company adopted this ASU and it did not have a material impact on the Company’s results of operations.
In May 2014, the Financial Accounting Standards Board (FASB) issued ASU 2014-09, Revenue from Contracts with Customers, to establish ASC Topic 606, (ASC 606). ASU 2014-09 supersedes the revenue recognition requirements in ASC Topic 605, Revenue Recognition and most industry-specific guidance throughout the Industry Topics of the Codification. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance includes a five-step framework that requires an entity to: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when the entity satisfies a performance obligation. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The Company adopted this ASU and it did not have a material impact on the Company’s results of operations.
The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations. |
5. Common Stock |
12 Months Ended |
|---|---|
Jun. 30, 2019 | |
| Equity [Abstract] | |
| Common Stock |
NOTE 5 – COMMON STOCK
On June 30, 2018, the Company granted 50,000 shares of common stock for services rendered as of June 30, 2018. The shares were valued at $0.50 for total non-cash compensation expense of $25,000. As of June 30, 2018 the shares had not yet been issued by the transfer agent.
During the year ended June 30, 2019, the Company sold 2,400,000 shares of common stock for total cash proceeds of $7,000. As of June 30, 2019, the shares have not yet been issued by the transfer agent and therefore have been credited to common stock to be issued.
Refer to Note 4 for shares issued to a related party. |
4. Related Party Transactions (Details Narrative) - USD ($) |
11 Months Ended | 12 Months Ended | |
|---|---|---|---|
May 24, 2018 |
Jun. 30, 2019 |
Jun. 30, 2018 |
|
| Stock owned | 83,450,000 | 35,450,000 | |
| Proceeds from related party | $ 72,085 | $ 300 | |
| Repayment to related party | 34,005 | 0 | |
| Loss on conversion of stock | (48,000) | 0 | |
| Richard Carey [Member] | |||
| Stock owned | 22,000,000 | ||
| Equity ownership | 62.15% | ||
| Proceeds from related party | 72,085 | 300 | |
| Repayment to related party | 34,005 | ||
| Conversion of stock, amount converted | $ 48,000 | ||
| Conversion of stock, shares converted | 48,000,000 | ||
| Loss on conversion of stock | $ (48,000) | ||
| Due to related party | $ 3,980 | $ 300 | |
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7. Income Tax (Details Narrative) |
Jun. 30, 2019
USD ($)
|
|---|---|
| Income Tax Disclosure [Abstract] | |
| Net operating loss carryforward | $ 634,000 |
Balance Sheets (Parenthetical) - $ / shares |
Jun. 30, 2019 |
Jun. 30, 2018 |
|---|---|---|
| Common stock, par value | $ 0.001 | $ 0.001 |
| Common stock, shares authorized | 175,000,000 | 175,000,000 |
| Common stock, shares issued | 83,450,000 | 35,450,000 |
| Common stock, shares outstanding | 83,450,000 | 35,450,000 |
| Preferred Stock [Member] | ||
| Preferred stock, par value | $ .001 | $ 0.001 |
| Preferred stock, shares authorized | 25,000,000 | 25,000,000 |
| Preferred stock, shares issued | 0 | 0 |
| Preferred stock, shares outstanding | 0 | 0 |
| Series B Preferred Stock [Member] | ||
| Preferred stock, par value | $ 0.001 | $ 0.001 |
| Preferred stock, shares authorized | 1,900,000 | 1,900,000 |
| Preferred stock, shares issued | 0 | 0 |
| Preferred stock, shares outstanding | 0 | 0 |
1. Nature of Business |
12 Months Ended |
|---|---|
Jun. 30, 2019 | |
| Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
| Nature of Business |
NOTE 1 – NATURE OF BUSINESS
Star Alliance International Corp. (“the Company”, “we”, “us”) was originally incorporated with the name Asteriko Corp. in the State of Nevada on April 17, 2014 under the laws of the state of Nevada, for the purpose of acquiring and developing gold mining as well as certain other mining properties worldwide. |