U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
Commission file number: 333-217428
(Exact name of registrant as specified in its charter)
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(State or Other Jurisdiction of Incorporation or Organization) |
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(Address of Principal Executive Offices) |
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Registrant’s telephone number, including area code: (
Indicate by check mark whether the registrant (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ]
Indicate by check mark whether the registrant 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 [ ] Non-accelerated filer [ ] Emerging growth company [ X] | Accelerated filer [ ] |
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. [ X]
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes [ X ] No [ ]
State the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date: As of February 7, 2018, the issuer had
TABLE OF CONTENTS
PART I |
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Item 1. | Financial Statements | 3 |
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 9 |
Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 11 |
Item 4. | Controls and Procedures | 11 |
PART II |
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Item 1. | Legal Proceedings | 11 |
Item 1A. | Risk Factors | 11 |
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 12 |
Item 3. | Defaults Upon Senior Securities | 12 |
Item 4. | Mining Safety Disclosures | 12 |
Item 5. | Other Information | 12 |
Item 6. | Exhibits | 12 |
| Signatures | 13 |
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PART I – FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
NOTES INCORPORATION
Contents
Balance Sheets as of December 31, 2017 (unaudited) and March 31, 2017 (audited) |
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Statements of Operations for the three and nine months ended December 31, 2017 (unaudited) |
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Statement of Cash Flows for the nine months ended December 31, 2017 (unaudited) |
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Notes to Financial Statements (unaudited) |
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Notes Incorporation Condensed Balance Sheets | ||||
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ASSETS |
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Current assets: |
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Cash | $ | $ | ||
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Total assets | $ | $ | ||
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LIABILITIES AND STOCKHOLDERS' EQUITY |
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Current liabilities: |
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Accounts payable | $ | $ | ||
Accrued compensation |
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Due to related party |
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Total current liabilities |
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Commitments and contingencies: |
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Stockholders' equity (deficit): |
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Common stock $ |
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Additional paid-in capital |
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Accumulated deficit |
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Total stockholders' equity (deficit) |
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Total liabilities and stockholders' equity | $ | $ | ||
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The accompanying notes are an integral part of these unaudited financial statements.
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| Notes Incorporation Condensed Statements of Operations (unaudited) | ||||||
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| For the Three Months Ended December 31, 2017 |
| From inception on November 21, 2016 through December 31, 2016 |
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Revenue | $ | $ | $ | |||||
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Operating expenses: |
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Professional fees |
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Officer compensation |
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General and administrative |
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Totaloperatingexpenses |
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Net loss from operations | $ | ( | $ | $ | ( | |||
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Loss before income tax |
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Provision for income taxes |
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Net Loss | $ | ( | $ | $ | ( | |||
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Basic and diluted net loss per common share | $ | ( | $ | $ | ( | |||
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Basic and diluted weighted average common shares outstanding |
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The accompanying notes are an integral part of these unaudited financial statements.
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Notes Incorporation Condensed Statement of Cash Flows (unaudited) | |||
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Cash flows from operating activities: |
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Net loss |
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Adjustments to reconcile net loss to net cash used in operations: |
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Changes in Operating Assets and Liabilities: |
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Accounts payable |
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Accrued compensation |
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Net cash used in operating activities |
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Cash flows from Financing activities: |
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Advances from a related party |
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Repayment of advances from a related party |
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Proceeds from the sale of common stock |
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Net cash provided by financing activities |
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Net decrease in cash |
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Cash, beginning of period |
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Cash, end of period |
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SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: |
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Cash paid for interest |
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Cash paid for taxes |
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The accompanying notes are an integral part of these unaudited financial statements.
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Notes Incorporation
Notes to Financial Statements
December 31, 2017
(unaudited)
NOTE 1 - DESCRIPTION OF BUSINESS AND HISTORY
Description of business
Notes Incorporation (the “Company”) was incorporated in the State of
NOTE 2 - GOING CONCERN
The accompanying unaudited financial statements have been prepared assuming that the company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As of December 31, 2017, the company had an accumulated deficit of $59,288, has not generated any revenues from operations and had a net loss of $57,778 for the nine months ended December 31, 2017. These factors, among others, raise substantial doubt about the ability of the company to continue as a going concern for a reasonable period of time. The company’s continuation as a going concern is dependent upon the company’s ability to begin operations and to achieve a level of profitability. The company intends on financing its future development activities and its working capital needs largely from the sale of public equity securities with some additional funding from other traditional financing sources, including term notes until such time that funds provided by operations are sufficient to fund working capital requirements. The financial statements of the company do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classifications of liabilities that might be necessary should the company be unable to continue as a going concern.
NOTE 3 - SUMMARY OF SIGNIFICANT POLICIES
Basis of presentation
The Company’s unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The accompanying unaudited condensed financial statements reflect all adjustments, consisting of only normal recurring items, which, in the opinion of management, are necessary for a fair statement of the results of operations for the periods shown and are not necessarily indicative of the results to be expected for the full year ending March 31, 2018. These unaudited condensed financial statements should be read in conjunction with the financial statements and related notes included in the Company’s Form S-1/A filed June 13, 2017.
Use of estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) requires the Company to make estimates and judgments that affect the reported amounts of assets and liabilities, revenues and expenses, and related disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. These estimates and judgments are based on historical information, information that is currently available to the Company and on various other assumptions that the Company believes to be reasonable under the circumstances. Actual results could differ from those estimates.
Development Stage Company
The company is considered to be in the development stage as defined in ASC 915 “Development Stage Entities” The company is devoting substantially all of its efforts to the development of its business plans. The company has elected to adopt application of Accounting Standards Update No. 2014-10, Development Stage Entities (Topic 915): Elimination of Certain Financial Reporting Requirements; and does not present or disclose inception-to-date information and other remaining disclosure requirements of Topic 915.
Recent Accounting Pronouncements
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.
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NOTE 4 - STOCKHOLDERS’ EQUITY
During the nine months ended December 31, 2017 the Company sold
NOTE 5 – RELATED PARTY TRANSACTIONS
On March 31, 2017
As of December 31, 2017 and March 31, 2017 the company owed Inderjit Aujala, the Company’s President, $
As of December 31, 2017 and March 31, 2017, the Company has accrued compensation due to its President of $
NOTE 6 – SUBSEQUENT EVENTS
In accordance with SFAS 165 (ASC 855-10) management has performed an evaluation of subsequent events through the date that the financial statements were available to be issued and through the date of the filing, and has determined that it does not have any material subsequent events to disclose in these financial statements.
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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following information should be read in conjunction with our financial statements and related notes thereto included in Part I, Item 1, above. We also urge you to review and consider our disclosures describing various risks that may affect our business, which are set forth under the heading "Risk Factors," below.
Forward Looking Statements
Certain matters discussed herein are forward-looking statements. Such forward-looking statements contained in this Form 10-Q involve risks and uncertainties, including statements as to:
·our future operating results;
·our business prospects;
·our contractual arrangements and relationships with third parties;
·the dependence of our future success on the general economy;
·our possible future financings; and
·the adequacy of our cash resources and working capital.
These forward-looking statements can generally be identified as such because the context of the statement will include words such as we “believe,” “anticipate,” “expect,” “estimate” or words of similar meaning. Similarly, statements that describe our future plans, objectives or goals are also forward-looking statements. Such forward-looking statements are subject to certain risks and uncertainties which are described in close proximity to such statements and which could cause actual results to differ materially from those anticipated. Shareholders, potential investors and other readers are urged to consider these factors in evaluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements included herein are only made as of the date of this Form 10-Q, and we undertake no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances.
Plan of Operations
We are a developmental stage company whose primary business is to design, develop and launch mobile applications (i.e. Utilities, games, media sharing etc.) for both the Android and iOS platforms.
Our intention is to begin development for various applications for the Android and iOS mobile platforms. Through market research and general global trends we plan on creating applications ranging from games to professional service related mobile applications. Currently, we have no mobile application developer on retention or as a hired employee. Our first mobile application planned for launch is a workplace messaging service, catered toward working professionals in a small to medium sized business. With the ability to create groups for project teams and management, this application would allow businesses to get notifications and updates much faster than emailing, which would allow for a more knowledgeable staff. In addition to groups, we plan on allowing for direct messaging between coworkers for messages or documents to be sent and received on a more private level. However, there can be no assurances that our efforts to develop the proposed messaging application will succeed or that we will be able to successfully market the proposed messaging application, if developed.
As we are developing, our sole officer and director will promote the marketing of our mobile applications. We plan to market our mobile applications through the following methods: social networking websites, word of mouth, search engine marketing, content marketing, paid advertisements, mobile advertising, guest blogging, social advertising and lastly through mobile app marketing agencies.
Results of Operations for the Three Months Ended December 31, 2017
Revenues
We have had no revenue since our inception on November 21, 2016.
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Operating Expenses
Operating expenses for the three months ended December 31, 2017 were $21,558. Of this $9,000 was for officer compensation, $4,600 was for accounting and audit expense and $7,958 for general and administrative expense. Officer compensation consists of $3,000 a month.
Net Loss
For the three months ended December 31, 2017 we realized a net loss of $21,558.
Results of Operations for the Nine Months Ended December 31, 2017
Revenues
We have had no revenue since our inception on November 21, 2016.
Operating Expenses
Operating expenses for the nine months ended December 31, 2017 were $57,778. Of this $38,000 was for officer compensation, $9,350 was for accounting and audit expense and $10,428 for general and administrative expense. Officer compensation consists of $3,000 a month, with an additional $11,000 bonus that was paid in September.
Net Loss
For the nine months ended December 31, 2017 we realized a net loss of $57,778.
Liquidity and Capital Resources
As reflected in the accompanying financial statements, the Company has an accumulated deficit of $59,288 at December 31, 2017, had a net loss of $57,778 and net cash used in operating activities of $46,778 for the nine months ended December 31, 2017. This raises substantial doubt about the Company’s ability to continue as a going concern.
Net cash flows from financing activities for the nine months ended December 31, 2017 were $44,835, $40,000 of which was from the sale of our common stock and $4,835 from related party advances.
We have no assurance that future financing will be available to us on acceptable terms. If financing is not available on satisfactory terms, we may be unable to continue, develop or expand our operations. Equity financing could result in additional dilution to existing shareholders.
Critical Accounting Estimates and Policies
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Note 3 to the Financial Statements describes the significant accounting policies and methods used in the preparation of the Financial Statements. Estimates are used for, but not limited to, contingencies and taxes. Actual results could differ materially from those estimates. The following critical accounting policies are impacted significantly by judgments, assumptions, and estimates used in the preparation of the Financial Statements.
We are subject to various loss contingencies arising in the ordinary course of business. We consider the likelihood of loss or impairment of an asset or the incurrence of a liability, as well as our ability to reasonably estimate the amount of loss in determining loss contingencies. An estimated loss contingency is accrued when management concludes that it is probable that an asset has been impaired or a liability has been incurred and the amount of the loss can be reasonably estimated. We regularly evaluate current information available to us to determine whether such accruals should be adjusted.
We recognize deferred tax assets (future tax benefits) and liabilities for the expected future tax consequences of temporary differences between the book carrying amounts and the tax basis of assets and liabilities. The deferred tax assets and liabilities
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represent the expected future tax return consequences of those differences, which are expected to be either deductible or taxable when the assets and liabilities are recovered or settled. Future tax benefits have been fully offset by a 100% valuation allowance as management is unable to determine that it is more likely than not that this deferred tax asset will be realized.
Off-Balance Sheet Arrangements
We have not entered into any 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 and would be considered material to investors.
Recent Accounting Pronouncements
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.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not applicable to smaller reporting companies.
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) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) that are designed to be effective in providing reasonable assurance that information required to be disclosed in our reports under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission (the “SEC”), and that such information is accumulated and communicated to our management to allow timely decisions regarding required disclosure. Our Chief Executive Officer and Chief Financial Officer evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based on that evaluation, they concluded that our disclosure controls and procedures were effective for the quarterly period ended December 31, 2017.
In designing and evaluating disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable, not absolute assurance of achieving the desired objectives. Also, 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.
Changes in Internal Controls
Based on that evaluation, our Chief Executive Officer and our Chief Financial Officer concluded that no change occurred in the Company's internal controls over financial reporting during the quarter ended December 31, 2017 that has materially affected, or is reasonably likely to materially affect, the Company's internal controls over financial reporting.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
There are not presently any material pending legal proceedings to which the Company is a party or as to which any of our property is subject, and no such proceedings are known to the Company to be threatened or contemplated against it.
ITEM 1A. RISK FACTORS
We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and, as such, are not required to provide the information under this Item.
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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. MINING SAFETY DISCLOSURES
Not applicable.
ITEM 5. OTHER INFORMATION.
None.
ITEM 6. EXHIBITS
Part I Exhibits
No. | Description |
31.1 | Certification of Chief Executive Officer and Chief Financial Officer pursuant to Securities Exchange Act of 1934 Rule 13a-14 (a) or 15d-14 (a). |
32.1 | Certification pursuant to Securities Exchange Act of 1934 Rule 13a-14 (b) or 15d-14(b) and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes - Oxley Act of 2002. |
Part II Exhibits
No. | Description |
101.INS | XBRL Instance Document |
101.SCH | XBRL Taxonomy Extension Schema Document |
101.CAL | XBRL Taxonomy Calculation Linkbase Document |
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document |
101.LAB | XBRL Taxonomy Label Linkbase Document |
101.PRE | XBRL Taxonomy Presentation Linkbase Document |
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SIGNATURES
In accordance with the requirements of the Exchange Act, the Registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
NOTES INCORPORATION
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Dated: February 7, 2018 | By: /s/ Inderjit Aujala Inderjit Aujala Chief Executive Officer, Chief Financial Officer
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