10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)

R QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2017

 or

 £ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from                      to                     

Commission file number: 333-133961

ORIGINAL SOURCE MUSIC, INC.

 (Exact name of registrant as specified in its charter)

Nevada (State or other jurisdiction of  incorporation or organization) 20-8594615 (I.R.S. Employer Identification No.)

8201 South Santa Fe Drive #229, Littleton, Colorado 80120

(Address of principal executive offices) (Zip Code)

(303) 495-3728

(Registrant’s telephone number, including area code)

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 þ   No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).   Yes ¨   No þ

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 the 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 þ
		(Do not check if a smaller reporting company)
			Emerging growth company ¨

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 a check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes ¨   No þ

APPLICABLE TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Class	Outstanding as of October 31, 2017
Common Stock, $0.001	5,273,000

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TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION
Item 1.	Condensed Consolidated Financial Statements (unaudited)	3
	Notes to Condensed Consolidated Financial Statements	6
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	12
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	15
Item 4.	Controls and Procedures	16
PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	17
Item 1A.	Risk Factors	17
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	17
Item 3.	Defaults Upon Senior Securities	17
Item 4.	Mine Safety Disclosures	17
Item 5.	Other Information	17
Item 6.	Exhibits	17
SIGNATURES		18

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PART I – FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements

Original Source Music, Inc.

Condensed Consolidated Balance Sheets

As of September 30, 2017, and December 31, 2016

 (Unaudited)

	September 30, 2017		December 31, 2016
Assets
Current assets
Cash and cash equivalents	$	685	$	842
Prepaid expenses		1,000		-
Total current assets		1,685		842
Total assets	$	1,685	$	842
Liabilities and Stockholders’ Deficit
Current liabilities
Accounts payable and accrued liabilities	$	100	$	100
Convertible notes payable, related parties, net of debt discount of $0 and 6,446, respectively		-		8,171
Total current liabilities		100		8,271
Notes payable, related parties		56,035		26,435
Total liabilities		56,135		34,706
Stockholders’ Deficit
Preferred stock, $0.001 par value; 5,000,000 shares authorized; none issued and outstanding		-		-
Common stock, $0.001 par value; 45,000,000 shares authorized; 5,273,000 and 5,073,000 shares issued and outstanding, respectively		5,273		5,073
Common stock payable		-		90
Additional paid-in capital		37,870		36,980
Accumulated deficit		(97,593)		(76,007)
Total Stockholders’ Deficit		(54,450)		(33,864)
Total Liabilities and Stockholders’ Deficit	$	1,685	$	842

See accompanying notes to unaudited condensed consolidated financial statements

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Original Source Music, Inc.

Condensed Consolidated Statements of Operations

For the three and nine months ended September, 2017 and 2016

(Unaudited)

	For the three months ended September 30,						For the nine months ended September,
	2017			2016			2017			2016
Revenue	$	75		$	50		$	271		$	244
Operating expenses:
General and administrative		1,939			951			2,288			1,206
Professional fees		3,300			1,800			13,123			9,215
Total operating expenses		5,239			2,751			15,411			10,421
Loss from operations		(5,164)			(2,701)			(15,140)			(10,177)
Interest expense, related parties		(2,134)			(6,177)			(6,446)			(13,866)
Loss before income taxes		(7,298)			(8,878)			(21,586)			(24,043)
Provision for income taxes		-			-			-			-
Net loss	$	(7,298)		$	(8,878)		$	(21,586)		$	(24,043)
Net Loss per common share
Basic and diluted	$	(0.00)	*	$	(0.00)	*	$	(0.00)	*	$	(0.00)
Weighted average shares outstanding
Basic and diluted		5,252,674			5,073,000			5,183,330			5,073,000

*denotes net loss per common share of less than $0.01 per share.

See accompanying notes to unaudited condensed consolidated financial statements

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Original Source Music, Inc.

Condensed Consolidated Statements of Cash Flows

For the nine months ended September 30, 2017 and 2016

(Unaudited)

	For the nine months ended September 30,
	2017		2016
Cash flows from operating activities:
Net loss	$	(21,586)	$	(24,043)
Adjustments to reconcile net loss to net cash used in operating activities:
Amortization of debt discount		6,446		13,102
Accrued interest to related parties		-		764
Changes in operating assets and liabilities:
Prepaid expenses		(1,000)		-
Accounts payable and accrued liabilities		1,000		(5,702)
Net cash used in operating activities		(15,140)		(15,879)
Cash flows from investing activities:
Net cash provided by (used in) investing activities		-		-
Cash flows from financing activities:
Proceeds from issuance of convertible notes payable, related parties		-		17,117
Repayment of convertible notes payable, related parties		-		(2,500)
Proceeds from issuance of notes payable, related parties		14,983		–
Net cash provided by financing activities		14,983		14,617
Net decrease in cash and cash equivalents		(157)		(1,262)
Cash and cash equivalents at beginning of period		842		1,838
Cash and cash equivalents at end of period	$	685	$	576
Supplemental disclosure of cash flow information:
Cash paid during the period for interest	$	-	$	-
Cash paid during the period for income taxes	$	-	$	-
Supplemental schedule of non-cash financing activities:
Professional fees paid by related party	$	1,000	$	-
Convertible notes payable, related parties, exchanged for non-convertible notes payable, related parties	$	14,617	$	-

See accompanying notes to unaudited condensed consolidated financial statements

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Original Source Music, Inc.

Notes to the Unaudited Condensed Consolidated Financial Statements

September 30, 2017

Note 1 — Interim Financial Statements

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). Accordingly, these condensed consolidated financial statements do not include all of the information and footnotes required for audited annual financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary to make the condensed consolidated financial statements not misleading have been included. The balance sheet at December 31, 2016, has been derived from the Company’s audited consolidated financial statements as of that date.

The unaudited condensed consolidated financial statements included herein should be read in conjunction with the audited consolidated financial statements and the notes thereto that are included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016, that was filed with the SEC on April 28, 2017. The results of operations for the nine months ended September 30, 2017, are not necessarily indicative of the results to be expected for the full year.

Note 2 — Going Concern

The Company’s financial statements have been prepared on a going concern basis, which contemplates the realization of assets and settlement of liabilities and commitments in the normal course of business. The Company has suffered a loss from operations and has negative cash flows from operations, and in all likelihood, will be required to make significant future expenditures in connection with marketing efforts along with general administrative expenses. These conditions raise substantial doubt about the Company's ability to continue as a going concern.

The Company may raise additional capital through the sale of its equity securities, through an offering of debt securities, or through borrowings from financial institutions or related parties. By doing so, the Company hopes to generate sufficient capital to execute its business plan of licensing songs to the television and music industry for use in television shows or movies on an ongoing basis. Management believes that actions presently being taken to obtain additional funding provide the opportunity for the Company to continue as a going concern.

Note 3 — Summary of Significant Accounting Policies

The significant accounting policies followed by the Company for interim reporting are consistent with those included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016. There were no material changes to our significant accounting policies during the interim period ended September 30, 2017.

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Recent Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (the “FASB”) issued guidance to clarify the principles for recognizing revenue. 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 provides a comprehensive framework for revenue recognition that supersedes current general revenue guidance and most industry-specific guidance. In addition, the guidance requires improved disclosures to help users of financial statements better understand the nature, amount, timing, and uncertainty of revenue that is recognized. The guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2017. Early adoption is permitted. However, entities reporting under U.S. GAAP are not permitted to adopt the standard earlier than the original effective date of December 15, 2016. An entity should apply the guidance either retrospectively to each prior reporting period presented or retrospectively with the cumulative adjustment at the date of the initial application. The Company is currently in the process of evaluating the impact of adoption of the new accounting guidance on its consolidated financial statements and has not determined the impact of adoption on its consolidated financial statements.

Note 4 — Convertible Notes Payable – Related Parties

	September 30,  2017		December 31, 2016
Convertible Note F
Principal	$	–	$	5,703
Debt Discount		–		(1,267)
Convertible Note G
Principal	$	–	$	7,114
Debt Discount		–		(4,269)
Convertible Note I
Principal	$	–	$	300
Debt Discount		–		(95)
Convertible Note J
Principal	$	–	$	1,500
Debt Discount		–		(815)
Total convertible notes payable to related parties, net of debt discounts	$	–	$	8,171

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Convertible Note F

In February 2016, a related party loaned the Company $5,703. The note would have matured on March 31, 2017, and was interest free until December 31, 2016. On December 31, 2016, the note was amended to extend the maturity date and the interest-free period to December 31, 2017. The note was convertible at the option of the holder into shares of the Company's common stock at a conversion price of $0.002 per share. The Company assessed the embedded conversion feature and determined that the fair value of the underlying common stock at inception exceeded the conversion price of this note and, accordingly, recorded a beneficial conversion feature (capped at proceeds received) of $5,703.  Such beneficial conversion feature was accounted for as a debt discount and was amortized to interest expense, using the straight-line interest rate method, over the life of the note.

Convertible Note G

In May 2016, a related party loaned the Company $7,114. The note would have matured on December 31, 2017. The note was interest free until December 31, 2016. On December 31, 2016, the note was amended to extend the interest-free period to December 31, 2017. The note was convertible at the option of the holder into shares of the Company's common stock at a conversion price of $0.002 per share. The Company assessed the embedded conversion feature and determined that the fair value of the underlying common stock at inception exceeded the conversion price of the note and, accordingly, recorded a beneficial conversion feature (capped at proceeds received) of $7,114. Such beneficial conversion feature was accounted for as a debt discount and was amortized to interest expense, using the straight-line interest rate method, over the life of the note.

Convertible Note I

In June 2016, a related party loaned the Company $300. The note would have matured on March 31, 2017, and was interest free until December 31, 2016. On December 31, 2016, the note was amended to extend the maturity date and the interest-free period to December 31, 2017. The note was convertible at the option of the holder into shares of the Company's common stock at a conversion price of $0.002 per share. The Company assessed the embedded conversion feature and determined that the fair value of the underlying common stock at inception exceeded the conversion price of this note and, accordingly, recorded a beneficial conversion feature (capped at proceeds received) of $300.  Such beneficial conversion feature was accounted for as a debt discount and was amortized to interest expense, using the straight-line interest rate method, over the life of the note.

In July 2017, Convertible Notes F, G, and I in the aggregate amount of $13,117 were exchanged for a non-convertible promissory note in the amount of $13,117 (see details of promissory note below in note 5) and 100,000 shares of common stock.

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Convertible Note J

In July 2016, a related party loaned the Company $1,500. The note would have matured on July 30, 2017, and was interest free until June 30, 2017. On June 30, 2017, the note was amended to extend the maturity date and the interest-free period to December 31, 2017. The note was convertible at the option of the holder into shares of the Company's common stock at a conversion price of $0.002 per share. The Company assessed the embedded conversion feature and determined that the fair value of the underlying common stock at inception exceeded the conversion price of this note and, accordingly, recorded a beneficial conversion feature (capped at proceeds received) of $1,500.  Such beneficial conversion feature was accounted for as a debt discount and was amortized to interest expense, using the straight-line interest rate method, over the life of the note.

In July 2017, Convertible Note J was exchanged for a non-convertible promissory note in the amount of $1,500 (see details of promissory note below in note 5) and 10,000 shares of common stock.

Note 5 — Notes Payable - Related Parties

Note K

In December 2016, a related party loaned the Company $4,920. The note is interest free until December 31, 2017, after which time bears interest at 6%. The note matures on December 31, 2018, and requires no periodic payment until maturity.

Note L

In December 2016, a related party loaned the Company $1,500. The note is interest free until December 31, 2017, after which time bears interest at 6%. The note matures on December 31, 2018, and requires no periodic payment until maturity.

Note M

In December 2016, three convertible notes payable, totaling $12,515, due to a related party were cancelled, and a new single promissory note payable in the amount of $12,515 was issued to replace the three convertible notes. The new promissory note is due on or before December 31, 2018. The note is interest free until December 31, 2017, after which time it bears interest at 6% per annum and requires no periodic payment until maturity. On January 30, 2017, 50,000 shares of the Company's common stock, valued at par, were issued to the related party in exchange for signing of the non-convertible promissory note.

Note N

In December 2016, two convertible notes payable, totaling $7,500, due to a related party were cancelled, and a new single promissory note payable in the amount of $7,500 was issued to replace the two convertible notes. The new promissory note is due on or before December 31, 2018. The note is interest free until December 31, 2017, after which time it bears interest at 6% per annum and requires no periodic payment until maturity. On January 30, 2017, 40,000 shares of the Company's common stock, valued at par, were issued to the related party in exchange for signing of the non-convertible promissory note.

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Note P

In March 2017, a related party loaned the Company $2,600. The note is interest free until December 31, 2017, after which time bears interest at 6%. The note matures on December 31, 2018, and requires no periodic payment until maturity.

Note Q

In June 2017, a related party loaned the Company $6,323. The note is interest free and matures on December 31, 2018. The note requires no periodic payment until maturity.

Note R

In July 2017, three convertible notes payable, totaling $13,117, due to a related party were cancelled, and a new single promissory note payable in the amount of $13,117 was issued to replace the three convertible notes. The new promissory note is interest free and matures on December 31, 2018. The note requires no periodic payment until maturity. In exchange for signing of the non-convertible promissory note, 100,000 shares of the Company's common stock, valued at par, were issued to the related party.

Note S

In July 2017, a convertible note payable in the amount of $1,500 due to a related party was cancelled, and a new promissory note payable in the amount of $1,500 was issued to replace the convertible note. The new promissory note is interest free and matures on December 31, 2018. The note requires no periodic payment until maturity. In exchange for signing of the non-convertible promissory note, 10,000 shares of the Company's common stock, valued at par, were issued to the related party.

Note T

In July 2017, a related party loaned the Company $3,800. The note is interest free and matures on December 31, 2018. The note requires no periodic payment until maturity.

Note U

In August 2017, a related party loaned the Company $2,260. The note is interest free and matures on December 31, 2018. The note requires no periodic payment until maturity.

All debt modifications were considered to have an immaterial impact on the fair value of the resulting debt instruments due to the nominal value of shares issued as inducements to exchange the convertible notes for non-convertible notes and the short time frames to maturity.

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Note 6 — Other Related Party Transactions

Professional fees paid by related party

In May 2017, $1,000 of professional fees associated with the preparation of the Company’s 2017 financial statements were paid by a related party on behalf of the Company. These fees were recorded as contributed capital by a related party since no consideration was paid, or will be paid, in exchange for these payments.

Note 7 — Subsequent Events

The Company has evaluated subsequent events through the date of the filing of this interim report on Form 10-Q. Based on this evaluation, the Company did not identify any significant subsequent events that would have a material effect on the consolidated financial statements, which would require an adjustment and/or additional disclosure.  

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

Our Management’s Discussion and Analysis should be read in conjunction with our unaudited condensed consolidated financial statements and related notes thereto included elsewhere in this quarterly report.

Forward-Looking Statements

This quarterly report on Form 10-Q contains “forward-looking statements” that include information relating to future events, future financial performance, strategies, expectations, competitive environment, regulation and availability of resources. These forward-looking statements include, without limitation, statements regarding: proposed new products or services; our statements concerning litigation or other matters; statements concerning projections, predictions, expectations, estimates or forecasts for our business, financial and operating results and future economic performance; statements of management’s goals and objectives; trends affecting our financial condition, results of operations or future prospects; our financing plans or growth strategies; and other similar expressions concerning matters that are not historical facts. Words such as “may,” “will,” “should,” “could,” “would,” “predicts,” “potential,” “continue,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes” and “estimates,” and similar expressions, as well as statements in future tense, identify forward-looking statements.

Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by which, that performance or those results will be achieved. Forward-looking statements are based on information available at the time they are made and/or management’s good faith belief as of that time with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. We assume no obligation to update forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information, except to the extent required by applicable securities laws. If we do update one or more forward-looking statements, no inference should be drawn that we will make additional updates with respect to those or other forward-looking statements. 

Business Overview

Original Source Music, Inc. (“the Company”, “we”, “us” or “our’) was incorporated in the State of Nevada on August 20, 2009 ("Inception"). We were a wholly owned subsidiary of Original Source Entertainment, Inc., a publicly traded Nevada corporation.  On February 5, 2014, the board of directors of Original Source Entertainment authorized the spin-off of the registrant to shareholders of record as of February 25, 2014.  

The spin-off was done in connection with a change of control of Original Source Entertainment. Under the terms of the spin-off, the registrant’s common shares, par value $0.001 per share, were distributed on a pro-rata basis to each holder of Original Source Entrainment’s common shares on the record date without any consideration or action on the part of such holders. The holders of Original Source Entertainment's common shares as of the record date became owners of 100 percent of our common shares. The spin-off was effective as of May 13, 2016, due to the satisfactory resolution of all comments from the Securities and Exchange Commission to the Registration Statement on Form 10 and the Form 10’s effectiveness.  

There is not expected to be any material change in our operations as a result of the spin-off.

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We currently have no employees, other than our officers, who are also our directors.

We are a development stage company with a primary focus on licensing music to the television and music industry for use in television shows or movies. The Company has had limited activity and revenue to date.

We review hundreds of music tracks written, produced, and performed by artists who have not already signed away their rights to their original works, then to contract those songs with the highest quality and potential for placement in television and film. The registrant intends to offer a wide variety of instrumental and vocal genres including pop, rock, R&B, jazz, country, singer/songwriter, new age, electronic, dance, funk, children's, adult contemporary, and more.

We contract with artists of all musical genres who own the publishing rights to their songs. Artists are referred to the registrant through advertisement, A&R companies, and referrals from friends, registrant signed artists, and other music industry acquaintances.

Our target customer includes all major and minor television networks, production companies and film makers. We intend to reach such customer bases through marketing, advertising, and direct sales calls.

Critical Accounting Policies, Judgments and Estimates

Our discussion and analysis of our financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”). The preparation of these consolidated financial statements requires us to make estimates, judgments and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and the related disclosure of contingent assets and liabilities. We base our estimates on historical experience and on various other assumptions that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

Our critical accounting policies are described in our Annual Report on Form 10-K for the year ended December 31, 2016. There have been no material changes to our critical accounting policies as of and for the three and nine months ended September 30, 2017.

Results of Operations for the Three and Nine Months Ended September 30, 2017 compared to the Three and Nine Months Ended September 30, 2016

During the three and nine months ended September 30, 2017, we generated revenues of $75 and $271, respectively, compared to revenues of $50 and $244 during the three and nine months ended September 30, 2016, respectively.

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During the three and nine months ended September 30, 2017, operating expenses, including general and administrative expenses and professional fees, were $5,239 and $15,411, respectively, compared to $2,751 and 10,421 of operating expenses during the three and nine months ended September 30, 2016. The increase of $2,488 in operating expenses during the three months ended September 30, 2017, was primarily attributed to increases of $1,000 for XBRL filing fees, $800 for legal fees and $700 for accounting services during the three months ended September 30, 2017. The increase of $4,990 in operating expenses during the nine months ended September 30, 2017, was primarily attributed to increases of $4,373 for accounting services and $1,000 for XBRL filing fees, partially offset by a decrease of $465 in legal fees during the nine months ended September 30, 2017.

Interest expense consists of the amortization of debt discounts associated with convertible notes due to related parties. Interest expense decreased by $4,043 and $7,420, respectively, during the three and nine months ended September 30, 2017, to $2,134 and $6,446, respectively, compared with interest expense of $6,177 and $13,866 during the three and nine months ended September 30, 2016. The decreases in interest expense during the interim periods in 2017 are due to the decrease in the number and amounts of convertible notes outstanding with unamortized debt discounts.

During the three and nine months ended September 30, 2017, the Company incurred net losses of $7,298 and $21,586, respectively, compared to net losses of $8,878 and $24,043 during the three and nine months ended September 30, 2016, respectively. The decrease in the net loss of $1,580 for the three months ended September 30, 2017, was primarily related to the decrease of $4,043 in interest expense, partially offset by an increase of $2,488 in operating expenses as discussed above. The decrease in the net loss of $2,457 for the nine months ended September 30, 2017, was primarily related to the decrease of $7,420 in interest expense, partially offset by the increase of $4,990 in operating expenses during the interim period.

Liquidity and Capital Resources

As of September 30, 2017, we had a cash balance of $685, a decrease of $157 from a balance of $842 at December 31, 2016.

Operating Activities

Net cash used in operating activities was $15,140 during the nine months ended September 30, 2017, compared with $15,879 used in operating activities during the nine months ended September 30, 2016. The $739 decrease in cash used in operations was due to a decrease of $5,702 in working capital requirements and a decrease in net loss of $2,457; partially offset by a decrease in non-cash charges of $7,420 during the nine months ended September 30, 2017.

Investing Activities

We neither generated nor used cash in investing activities during the nine months ended September 30, 2017 and 2016.

Financing Activities

Cash flows provided by financing activities were $14,983 and $14,617 during the nine months ended September 30, 2017 and 2016, respectively.

14

During the nine months ended September 30, 2017, the Company received $14,983 from the issuance of promissory notes to a related party.

During the nine months ended September 30, 2016, the Company received $17,117 from the issuance of convertible promissory notes to related parties and repaid $2,500 of a convertible promissory note to a related party.

Going Concern

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As shown in the accompanying financial statements, we have incurred net losses of $21,586 and $24,043 for the nine months ended September 30, 2017 and 2016, respectively, and have an accumulated deficit of $97,593 as of September 30, 2017, which raises substantial doubt about the Company’s ability to continue as a going concern.

Management believes the Company will continue to incur losses and negative cash flows from operating activities for the foreseeable future and will need additional equity or debt financing to sustain its operations until it can achieve profitability and positive cash flows, if ever. Management plans to seek additional debt and/or equity financing for the Company, but cannot assure that such financing will be available on acceptable terms.

Should existing management, stockholders or our affiliates refuse to advance needed funds, however, we would be forced to turn to outside parties to either lend funds to us or buy our securities. There is no assurance that we will be able to raise the necessary funds, when needed, from outside sources.

The Company’s continuation as a going concern is dependent upon its ability to ultimately attain profitable operations, generate sufficient cash flow to meet its obligations, and obtain additional financing as may be required. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty. There can be no assurance that management will be successful in implementing its business plan or that the successful implementation of such business plan will actually improve our operating results.

Off Balance Sheet Arrangements

We have not entered into any off-balance sheet arrangements.

Inflation

We do not believe that inflation has had in the past or will have in the future any significant negative impact on our operations.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Not required for smaller reporting companies.

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Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act that are designed to insure that information required to be disclosed in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the periods specified in the Securities and Exchange Commission’s rules and forms and that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, or the persons performing similar functions, to allow timely decisions regarding required disclosure.

Under the supervision and with the participation of our CEO and CFO, or the persons performing similar functions, our management has evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this interim report.  Based on that evaluation, our CEO and CFO, or the persons performing similar functions, concluded that our disclosure controls and procedures were effective as of September 30, 2017.

Change in Internal Control over Financial Reporting

During the interim period ended September 30, 2017, there were no changes in our internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Securities Exchange Act Rules 13a-15 or 15d-15 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II — OTHER INFORMATION

Item 1. Legal Proceedings

There are no legal proceedings, which are pending or have been threatened against us or any of our officers, directors or control persons of which management is aware.

Item 1A. Risk Factors

Not required for a smaller reporting company. 

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

There were no unregistered sales of equity securities during the interim periods ended September 30, 2017 and 2016.

Item 3. Defaults upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

Item 6. Exhibits

Exhibit 31 — Section 302 Certificate of Principal Executive Officer and Principal Financial Officer

Exhibit 32 — Section 906 Certificate of Principal Executive Officer and Principal Financial Officer

17

SIGNATURES

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.

ORIGINAL SOURCE MUSIC, INC.

By:	/s/ Lecia L. Walker
	Lecia L. Walker
	Chief Executive Officer (Principal Executive Officer and Principal Financial Officer)
	Dated: November 7, 2017

18

EX-31

Exhibit 31

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

AND PRINCIPAL FINANCIAL OFFICER

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Lecia Walker, certify that:

1.

I have reviewed this Quarterly Report on Form 10-Q of Original Source Music, Inc.;

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

4.

The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:

a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)

Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)

Disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter (the Registrant’s fourth quarter in the case of an Quarterly report) that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and

5.

The Registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors (or persons performing the equivalent functions):

a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and

b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.

Dated: November 7, 2017

/s/  Lecia Walker     

Name:

Lecia Walker

Title:

Principal Executive Officer

Principal Financial Officer

EX-32

Exhibit 31

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

AND PRINCIPAL FINANCIAL OFFICER

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Lecia Walker, certify that:

1.

I have reviewed this Quarterly Report on Form 10-Q of Original Source Music, Inc.;

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

4.

The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:

a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)

Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)

Disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter (the Registrant’s fourth quarter in the case of an Quarterly report) that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and

5.

The Registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors (or persons performing the equivalent functions):

a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and

b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.

Dated: November 7, 2017

/s/  Lecia Walker              _     _____

Name:

Lecia Walker

Title:

Principal Executive Officer

Principal Financial Officer

Exhibit 32

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

AND PRINCIPAL FINANCIAL OFFICER

Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

I, Lecia Walker, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Quarterly Report of Original Source Music, Inc. on Form 10-Q for the period ended September 30, 2017, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained in such Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Original Source Music, Inc.

Dated: November 7, 2017

/s/  Lecia Walker            

Name:

Lecia Walker

Title:

Principal Executive Officer

Principal Financial Officer

XML

Document and Entity Information	9 Months Ended
	Sep. 30, 2017 shares
Document and Entity Information:
Entity Registrant Name	Original Source Music, Inc.
Document Type	10-Q
Document Period End Date	Sep. 30, 2017
Trading Symbol	osmu
Amendment Flag	false
Entity Central Index Key	0001639836
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding	5,273,000
Entity Filer Category	Smaller Reporting Company
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	Q3

XML

Original Source Music, Inc. - Condensed Consolidated Balance Sheets - USD ($)		Sep. 30, 2017	Dec. 31, 2016
Current Assets:
Cash and cash equivalents		$ 685	$ 842
Prepaid expenses		1,000
Total Currents Assets		1,685	842
Total Assets		1,685	842
Current Liabilities:
Accounts payable and accrued liabilities		100	100
Convertible notes payable, related parties	[1]		8,171
Total Current Liabilities		100	8,271
Notes payable, related parties		56,035	26,435
Total Liabilities		56,135	34,706
Stockholders' Deficit
Preferred stock	[2]
Common stock	[3]	5,273	5,073
Common stock payable			90
Additional paid-in capital		37,870	36,980
Accumulated deficit		(97,593)	(76,007)
Total Stockholders' Deficit		(54,450)	(33,864)
Total Liabilities and Stockholders' Deficit		$ 1,685	$ 842

[1] Net of debt discount of $0 and $6,446, respectively

[2] $0.001 par value; 5,000,000 shares authorized; none issued and outstanding

[3] $0.001 par value; 45,000,000 shares authorized; 5,273,000 and 5,073,000 shares issued and outstanding, respectively

XML

Statement of Financial Position - Parenthetical - $ / shares	Sep. 30, 2017	Dec. 31, 2016
Statement of Financial Position
Preferred Stock, Par Value	$ 0.001	$ 0.001
Preferred Stock, Shares Authorized	5,000,000	5,000,000
Preferred Stock, Shares Issued	0	0
Preferred Stock, Shares Outstanding	0	0
Common Stock, Par Value	$ 0.001	$ 0.001
Common Stock, Shares Authorized	45,000,000	45,000,000
Common Stock, Shares Issued	5,273,000	5,073,000
Common Stock, Shares Outstanding	5,273,000	5,073,000

XML

Original Source Music, Inc. - Condensed Consolidated Statements of Operations - USD ($)		3 Months Ended		9 Months Ended
		Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
Income Statement
Revenue		$ 75	$ 50	$ 271	$ 244
Operating Expenses:
General and administrative		1,939	951	2,288	1,206
Professional fees		3,300	1,800	13,123	9,215
Total operating expenses		5,239	2,751	15,411	10,421
Loss from operations		(5,164)	(2,701)	(15,140)	(10,177)
Interest expense, related parties		(2,134)	(6,177)	(6,446)	(13,866)
Loss before income taxes		(7,298)	(8,878)	(21,586)	(24,043)
Provision for income taxes
Net loss		$ (7,298)	$ (8,878)	$ (21,586)	$ (24,043)
Net loss per common share basic and diluted	[1]	$ (0.00)	$ (0.00)	$ (0.00)	$ (0.00)
Weighted average shares outstanding basic and diluted		5,252,674	5,073,000	5,183,330	5,073,000

[1] Denotes net loss per common share of less than $0.01 per share.

XML

Original Source Music, Inc. - Condensed Consolidated Statements of Cash Flows - USD ($)	9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016
Cash flows from operating activities:
Net loss	$ (21,586)	$ (24,043)
Adjustments to reconcile net loss to net cash used in operating activities:
Amortization of debt discount	6,446	13,102
Accrued interest to related parties		764
Changes in operating assets and liabilities:
Prepaid expenses, increase decrease	(1,000)
Accounts payable and accrued liabilities, increase decrease	1,000	(5,702)
Net cash used in operating activities	(15,140)	(15,879)
Cash flows from investing activities:
Net cash provided by (used in) investing activities
Cash flows from financing activities:
Proceeds from issuance of convertible notes payable, related parties		17,117
Repayment of convertible notes payable, releated parties		(2,500)
Proceeds from issuance of notes payable, related party	14,983
Net cash provided by financing activities	14,983	14,617
Net decrease in cash and cash equivalents	(157)	(1,262)
Cash and cash equivalents at beginning of period	842	1,838
Cash and cash equivalents at end of period	685	576
Supplemental disclosure of cash flow information:
Cash paid during the period for interest
Cash paid during the period for income taxes
Supplemental schedule of non-cash financing activities:
Professional fees paid by related party	1,000
Convertible notes payable, related parties, exchanged for non-convertible notes payable, related parties	$ 14,617

XML

Note 1 - Interim Financial Statements

9 Months Ended

Sep. 30, 2017

Notes

Note 1 - Interim Financial Statements

Note 1 — Interim Financial Statements

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). Accordingly, these condensed consolidated financial statements do not include all of the information and footnotes required for audited annual financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary to make the condensed consolidated financial statements not misleading have been included. The balance sheet at December 31, 2016, has been derived from the Company’s audited consolidated financial statements as of that date.

The unaudited condensed consolidated financial statements included herein should be read in conjunction with the audited consolidated financial statements and the notes thereto that are included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016, that was filed with the SEC on April 28, 2017. The results of operations for the nine months ended September 30, 2017, are not necessarily indicative of the results to be expected for the full year.

XML

Note 2 - Going Concern

9 Months Ended

Sep. 30, 2017

Notes

Note 2 - Going Concern

Note 2 — Going Concern

The Company’s financial statements have been prepared on a going concern basis, which contemplates the realization of assets and settlement of liabilities and commitments in the normal course of business. The Company has suffered a loss from operations and has negative cash flows from operations, and in all likelihood, will be required to make significant future expenditures in connection with marketing efforts along with general administrative expenses. These conditions raise substantial doubt about the Company's ability to continue as a going concern.

The Company may raise additional capital through the sale of its equity securities, through an offering of debt securities, or through borrowings from financial institutions or related parties. By doing so, the Company hopes to generate sufficient capital to execute its business plan of licensing songs to the television and music industry for use in television shows or movies on an ongoing basis. Management believes that actions presently being taken to obtain additional funding provide the opportunity for the Company to continue as a going concern.

XML

Note 3 - Summary of Significant Accounting Policies

9 Months Ended

Sep. 30, 2017

Notes

Note 3 - Summary of Significant Accounting Policies

Note 3 — Summary of Significant Accounting Policies

The significant accounting policies followed by the Company for interim reporting are consistent with those included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016. There were no material changes to our significant accounting policies during the interim period ended September 30, 2017.

Recent Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (the “FASB”) issued guidance to clarify the principles for recognizing revenue. 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 provides a comprehensive framework for revenue recognition that supersedes current general revenue guidance and most industry-specific guidance. In addition, the guidance requires improved disclosures to help users of financial statements better understand the nature, amount, timing, and uncertainty of revenue that is recognized. The guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2017. Early adoption is permitted. However, entities reporting under U.S. GAAP are not permitted to adopt the standard earlier than the original effective date of December 15, 2016. An entity should apply the guidance either retrospectively to each prior reporting period presented or retrospectively with the cumulative adjustment at the date of the initial application. The Company is currently in the process of evaluating the impact of adoption of the new accounting guidance on its consolidated financial statements and has not determined the impact of adoption on its consolidated financial statements.

XML

Note 4 - Convertible Notes Payable - Related Parties

9 Months Ended

Sep. 30, 2017

Notes

Note 4 - Convertible Notes Payable - Related Parties

Note 4 — Convertible Notes Payable – Related Parties

	September 30,  2017		December 31, 2016
Convertible Note F
Principal	$	–	$	5,703
Debt Discount		–		(1,267)
Convertible Note G
Principal	$	–	$	7,114
Debt Discount		–		(4,269)
Convertible Note I
Principal	$	–	$	300
Debt Discount		–		(95)
Convertible Note J
Principal	$	–	$	1,500
Debt Discount		–		(815)
Total convertible notes payable to related parties, net of debt discounts	$	–	$	8,171

Convertible Note F

In February 2016, a related party loaned the Company $5,703. The note would have matured on March 31, 2017, and was interest free until December 31, 2016. On December 31, 2016, the note was amended to extend the maturity date and the interest-free period to December 31, 2017. The note was convertible at the option of the holder into shares of the Company's common stock at a conversion price of $0.002 per share. The Company assessed the embedded conversion feature and determined that the fair value of the underlying common stock at inception exceeded the conversion price of this note and, accordingly, recorded a beneficial conversion feature (capped at proceeds received) of $5,703.  Such beneficial conversion feature was accounted for as a debt discount and was amortized to interest expense, using the straight-line interest rate method, over the life of the note.

Convertible Note G

In May 2016, a related party loaned the Company $7,114. The note would have matured on December 31, 2017. The note was interest free until December 31, 2016. On December 31, 2016, the note was amended to extend the interest-free period to December 31, 2017. The note was convertible at the option of the holder into shares of the Company's common stock at a conversion price of $0.002 per share. The Company assessed the embedded conversion feature and determined that the fair value of the underlying common stock at inception exceeded the conversion price of the note and, accordingly, recorded a beneficial conversion feature (capped at proceeds received) of $7,114. Such beneficial conversion feature was accounted for as a debt discount and was amortized to interest expense, using the straight-line interest rate method, over the life of the note.

Convertible Note I

In June 2016, a related party loaned the Company $300. The note would have matured on March 31, 2017, and was interest free until December 31, 2016. On December 31, 2016, the note was amended to extend the maturity date and the interest-free period to December 31, 2017. The note was convertible at the option of the holder into shares of the Company's common stock at a conversion price of $0.002 per share. The Company assessed the embedded conversion feature and determined that the fair value of the underlying common stock at inception exceeded the conversion price of this note and, accordingly, recorded a beneficial conversion feature (capped at proceeds received) of $300.  Such beneficial conversion feature was accounted for as a debt discount and was amortized to interest expense, using the straight-line interest rate method, over the life of the note.

In July 2017, Convertible Notes F, G, and I in the aggregate amount of $13,117 were exchanged for a non-convertible promissory note in the amount of $13,117 (see details of promissory note below in note 5) and 100,000 shares of common stock.

Convertible Note J

In July 2016, a related party loaned the Company $1,500. The note would have matured on July 30, 2017, and was interest free until June 30, 2017. On June 30, 2017, the note was amended to extend the maturity date and the interest-free period to December 31, 2017. The note was convertible at the option of the holder into shares of the Company's common stock at a conversion price of $0.002 per share. The Company assessed the embedded conversion feature and determined that the fair value of the underlying common stock at inception exceeded the conversion price of this note and, accordingly, recorded a beneficial conversion feature (capped at proceeds received) of $1,500.  Such beneficial conversion feature was accounted for as a debt discount and was amortized to interest expense, using the straight-line interest rate method, over the life of the note.

In July 2017, Convertible Note J was exchanged for a non-convertible promissory note in the amount of $1,500 (see details of promissory note below in note 5) and 10,000 shares of common stock.

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Note 5 - Notes Payable - Related Parties

9 Months Ended

Sep. 30, 2017

Notes

Note 5 - Notes Payable - Related Parties

Note 5 — Notes Payable - Related Parties

Note K

In December 2016, a related party loaned the Company $4,920. The note is interest free until December 31, 2017, after which time bears interest at 6%. The note matures on December 31, 2018, and requires no periodic payment until maturity.

Note L

In December 2016, a related party loaned the Company $1,500. The note is interest free until December 31, 2017, after which time bears interest at 6%. The note matures on December 31, 2018, and requires no periodic payment until maturity.

Note M

In December 2016, three convertible notes payable, totaling $12,515, due to a related party were cancelled, and a new single promissory note payable in the amount of $12,515 was issued to replace the three convertible notes. The new promissory note is due on or before December 31, 2018. The note is interest free until December 31, 2017, after which time it bears interest at 6% per annum and requires no periodic payment until maturity. On January 30, 2017, 50,000 shares of the Company's common stock, valued at par, were issued to the related party in exchange for signing of the non-convertible promissory note.

Note N

In December 2016, two convertible notes payable, totaling $7,500, due to a related party were cancelled, and a new single promissory note payable in the amount of $7,500 was issued to replace the two convertible notes. The new promissory note is due on or before December 31, 2018. The note is interest free until December 31, 2017, after which time it bears interest at 6% per annum and requires no periodic payment until maturity. On January 30, 2017, 40,000 shares of the Company's common stock, valued at par, were issued to the related party in exchange for signing of the non-convertible promissory note.

Note P

In March 2017, a related party loaned the Company $2,600. The note is interest free until December 31, 2017, after which time bears interest at 6%. The note matures on December 31, 2018, and requires no periodic payment until maturity.

Note Q

In June 2017, a related party loaned the Company $6,323. The note is interest free and matures on December 31, 2018. The note requires no periodic payment until maturity.

Note R

In July 2017, three convertible notes payable, totaling $13,117, due to a related party were cancelled, and a new single promissory note payable in the amount of $13,117 was issued to replace the three convertible notes. The new promissory note is interest free and matures on December 31, 2018. The note requires no periodic payment until maturity. In exchange for signing of the non-convertible promissory note, 100,000 shares of the Company's common stock, valued at par, were issued to the related party.

Note S

In July 2017, a convertible note payable in the amount of $1,500 due to a related party was cancelled, and a new promissory note payable in the amount of $1,500 was issued to replace the convertible note. The new promissory note is interest free and matures on December 31, 2018. The note requires no periodic payment until maturity. In exchange for signing of the non-convertible promissory note, 10,000 shares of the Company's common stock, valued at par, were issued to the related party.

Note T

In July 2017, a related party loaned the Company $3,800. The note is interest free and matures on December 31, 2018. The note requires no periodic payment until maturity.

Note U

In August 2017, a related party loaned the Company $2,260. The note is interest free and matures on December 31, 2018. The note requires no periodic payment until maturity.

All debt modifications were considered to have an immaterial impact on the fair value of the resulting debt instruments due to the nominal value of shares issued as inducements to exchange the convertible notes for non-convertible notes and the short time frames to maturity.

XML

Note 6 - Other Related Party Transactions

9 Months Ended

Sep. 30, 2017

Notes

Note 6 - Other Related Party Transactions

Note 6 — Other Related Party Transactions

Professional fees paid by related party

In May 2017, $1,000 of professional fees associated with the preparation of the Company’s 2017 financial statements were paid by a related party on behalf of the Company. These fees were recorded as contributed capital by a related party since no consideration was paid, or will be paid, in exchange for these payments.

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Note 7 - Subsequent Events

9 Months Ended

Sep. 30, 2017

Notes

Note 7 - Subsequent Events

Note 7 — Subsequent Events

The Company has evaluated subsequent events through the date of the filing of this interim report on Form 10-Q. Based on this evaluation, the Company did not identify any significant subsequent events that would have a material effect on the consolidated financial statements, which would require an adjustment and/or additional disclosure. 

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Note 3 - Summary of Significant Accounting Policies: Recent Accounting Pronouncements (Policies)

9 Months Ended

Sep. 30, 2017

Policies

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (the “FASB”) issued guidance to clarify the principles for recognizing revenue. 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 provides a comprehensive framework for revenue recognition that supersedes current general revenue guidance and most industry-specific guidance. In addition, the guidance requires improved disclosures to help users of financial statements better understand the nature, amount, timing, and uncertainty of revenue that is recognized. The guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2017. Early adoption is permitted. However, entities reporting under U.S. GAAP are not permitted to adopt the standard earlier than the original effective date of December 15, 2016. An entity should apply the guidance either retrospectively to each prior reporting period presented or retrospectively with the cumulative adjustment at the date of the initial application. The Company is currently in the process of evaluating the impact of adoption of the new accounting guidance on its consolidated financial statements and has not determined the impact of adoption on its consolidated financial statements.

XML

Note 4 - Convertible Notes Payable - Related Parties: Convertible Debt (Tables)

9 Months Ended

Sep. 30, 2017

Tables/Schedules

Convertible Debt

	September 30,  2017		December 31, 2016
Convertible Note F
Principal	$	–	$	5,703
Debt Discount		–		(1,267)
Convertible Note G
Principal	$	–	$	7,114
Debt Discount		–		(4,269)
Convertible Note I
Principal	$	–	$	300
Debt Discount		–		(95)
Convertible Note J
Principal	$	–	$	1,500
Debt Discount		–		(815)
Total convertible notes payable to related parties, net of debt discounts	$	–	$	8,171

XML

Note 4 - Convertible Notes Payable - Related Parties: Convertible Debt (Details)	Dec. 31, 2016 USD ($)
Convertible Notes Payable	$ 8,171
Convertible Note F
Convertible Notes Payable Principal	5,703
Convertible Debt Discount	(1,267)
Convertible Note G
Convertible Notes Payable Principal	7,114
Convertible Debt Discount	(4,269)
Convertible Note I
Convertible Notes Payable Principal	300
Convertible Debt Discount	(95)
Convertible Note J
Convertible Notes Payable Principal	1,500
Convertible Debt Discount	$ (815)