10-Q 1 form10-q.htm

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

 

For The Quarterly Period Ended September 30, 2020

 

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 333-230479

 

SEATECH VENTURES CORP.

(Exact name of registrant issuer as specified in its charter)

 

Nevada   61-1882326

(State or other jurisdiction of

incorporation or organization)

  

(I.R.S. Employer

Identification No.)

 

Suite 2708-09, 27/F, The Metropolis Tower,

10 Metropolis Drive, Hung Hom, Hong Kong

(Address of principal executive offices, including zip code)

 

Registrant’s phone number, including area code +852 83311767

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

 

YES [X] NO [  ]

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (section 232.405 of this chapter) during the preceding twelve months (or shorter period that the registrant was required to submit and post such files).

 

YES [  ] NO [X]

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting 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]

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class   Trading Symbol   Name of Exchange registered
Common Stock   SEAV   The OTC Market- Pink Sheets

 

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY

PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

 

Indicate by check mark whether the registrant has fled all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.

 

Yes [  ] No [X]

 

APPLICABLE ONLY 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 at November 11, 2020
Common Stock, $.0001 par value   92,519,867

 

 

 

 

 

 

TABLE OF CONTENTS

 

    Page
PART I FINANCIAL INFORMATION  
ITEM 1. UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS: F-1
  Condensed Consolidated Balance Sheets as of September 30, 2020 (unaudited) and December 31, 2019 (audited) F-2
  Condensed Consolidated Statements of Operations and Comprehensive Losses for the Nine months Ended September 30, 2020 and 2019 (unaudited) F-3
  Condensed Consolidated Statements of Changes in Equity for the Nine months Ended September 30, 2020 and 2019 F-4
  Condensed Consolidated Statements of Cash Flows for the Nine months Ended September 30, 2020 and 2019 (unaudited) F-5
  Notes to the Condensed Consolidated Financial Statements F-6 - F-13
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 3-5
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 6
ITEM 4. CONTROLS AND PROCEDURES 6
PART II OTHER INFORMATION  
ITEM 1 LEGAL PROCEEDINGS 7
ITEM 2 UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS 7
ITEM 3 DEFAULTS UPON SENIOR SECURITIES 7
ITEM 4 MINE SAFETY DISCLOSURES 7
ITEM 5 OTHER INFORMATION 7
ITEM 6 EXHIBITS 8
  SIGNATURES 9

 

2

 

 

PART I FINANCIAL INFORMATION

 

ITEM 1. UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS:

 

SEATECH VENTURES CORP.

CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

  Page
Condensed Consolidated Financial Statements  
   
Condensed Consolidated Balance Sheets as of September 30, 2020 (unaudited) and December 31, 2019 (audited) F-2
Condensed Consolidated Statements of Operations and Comprehensive Losses for the Nine months Ended September 30, 2020 and 2019 (unaudited) F-3
Condensed Consolidated Statements of Changes in Equity for the Nine months Ended September 30, 2020 and 2019 (unaudited) F-4
Condensed Consolidated Statements of Cash Flows for the Nine months Ended September 30, 2020 and 2019 (unaudited) F-5
Notes to the Condensed Consolidated Financial Statements F-6 - F-13

 

F-1

 

 

SEATECH VENTURES CORP.

CONDENSED CONSOLIDATED BALANCE SHEETS

AS OF SEPTEMBER 30, 2020, AND DECEMBER 31, 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

 

   As of   As of 
   September 30, 2020   December 31, 2019 
   Unaudited   Audited 
ASSETS          
CURRENT ASSETS          
Trade receivables  $1,181   $- 
Cash and cash equivalents  $306,950   $339,809 
Total Current Assets  $308,131   $339,809 
           
NON-CURRENT ASSETS          
Investment in other companies  $1,015   $1,015 
           
TOTAL ASSETS   309,146    340,824 
           
LIABILITIES AND STOCKHOLDERS’ EQUITY          
CURRENT LIABILITIES          
Amount due to director   1,631    1,631 
Accrued expenses and other payables   8,569    304,656 
Total Current Liabilities  $10,200   $306,287 
TOTAL LIABILITIES  $10,200   $306,287 
           
STOCKHOLDERS’ EQUITY          
Preferred stock, $0.0001 par value; 200,000,000 shares authorized; None issued and outstanding   -    - 
Common Shares, par value $0.0001; 600,000,000 shares authorized, 92,519,867 and 92,176,667 shares issued and outstanding as of September 30, 2020 and December 31, 2019  $9,252   $9,218 
Additional paid in capital   659,958    316,792 
Accumulated other comprehensive profit/(loss)   (122)   (122)
Accumulated deficit   (370,142)   (291,351)
TOTAL STOCKHOLDERS’ EQUITY  $298,946   $34,537 
           
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY  $309,146   $340,824 

 

See accompanying notes to condensed consolidated financial statements.

 

F-2

 

 

SEATECH VENTURES CORP.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSSES

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2020 and 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

 

   For the period ended
September 30, 2020
(Unaudited)		   For the period ended
September 30, 2019
(Unaudited)		 
REVENUE  $55,381   $28,507 
           
COST OF REVENUE   (50,000)   (18,720)
           
GROSS PROFIT   5,381    9,787 
           
OTHER INCOME   3,691    22 
           
SELLING AND DISTRIBUTION EXPENSES   (14,020)   (25,461)
           
GENERAL AND ADMINISTRATIVE EXPENSES   (73,843)   (163,543)
           
LOSS BEFORE INCOME TAX   (78,791)  $(179,195)
           
INCOME TAXES PROVISION   -    - 
           
NET LOSS   (78,791)   (179,195)
           
Net Loss attributable to Non-Controlling Interests          
Other comprehensive income/(loss):          
- Foreign exchange adjustment gain/(loss)   -    - 
TOTAL COMPREHENSIVE LOSS  $(78,791)  $(179,195)
           
Net loss per share- Basic and diluted   (0.00)   (0.00)
           
Weighted average number of common shares outstanding - Basic and diluted   92,286,038    92,176,667 

 

See accompanying notes to condensed consolidated financial statements.

 

F-3

 

 

SEATECH VENTURES CORP.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2020 and 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

 

Nine months Ended September 30, 2020 (Unaudited)

 

 

   COMMON SHARES   ADDITIONAL   ACCUMULATED OTHER         
   Number of Shares   Amount   PAID-IN CAPITAL   COMPREHENSIVE INCOME/(LOSS)   ACCUMULATED DEFICIT   TOTAL EQUITY 
                         
Balance as of December 31, 2019   92,176,667   $9,218   $316,792   $(122)  $(291,351)  $34,537 
Shares issued in Initial Public Offering completed on May 4, 2020 at $1.00 per share   343,200    34    343,166    -    -    343,200 
 Net loss for the period   -    -    -    -    (78,791)   (78,791)
Balance as of September 30,2020   92,519,867    9,252    659,958    (122)   (370,142)   (298,946)

 

Nine months Ended September 30, 2019 (Unaudited)

 

 

   COMMON SHARES   ADDITIONAL   ACCUMULATED OTHER         
   Number of Shares   Amount   PAID-IN CAPITAL   COMPREHENSIVE INCOME/(LOSS)   ACCUMULATED DEFICIT   TOTAL EQUITY 
Balance as of December 31, 2018   92,176,667   $9,218   $316,792   $(122)  $(71,807)  $254,081 
Net loss for the period   -    -    -    -    (179,195)   (179,195)
Balance as of September 30, 2019   92,176,667   $9,218   $316,792   $(122)  $(251,002)  $74,886

 

F-4

 

 

SEATECH VENTURES CORP.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2020 and 2019

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

 

  

Nine months ended

September 30, 2020

  

Nine months ended

September 30, 2019

 
         
CASH FLOWS FROM OPERATING ACTIVITIES:          
Net loss  $(78,791)  $(179,195)
Adjustments to reconcile net loss to net cash used in operating activities:          
Depreciation   -    - 
Changes in operating assets and liabilities:          
Accounts receivable   (1,181)   3,000 
Account due to a related party   -    4,500 
Other payables and accrued liabilities   (296,088)   2,500 
Net cash used in operating activities  $(376,060)  $(169,195)
           
CASH FLOWS FROM FINANCING ACTIVITIES:          
Issuance of share capital at par value, being          
net cash generated from financing activity  $343,200   $- 
           
Effect of exchange rate changes on cash and cash equivalents   -    - 
           
Net change in cash and cash equivalents   (32,860)   (169,195)
           
Cash and cash equivalents, beginning of period   339,810    260,912 
           
CASH AND CASH EQUIVALENTS, END OF PERIOD  $306,950   $91,717 
           
SUPPLEMENTAL CASH FLOWS INFORMATION          
Income taxes paid  $-   $- 
Interest paid  $-   $- 

 

See accompanying notes to condensed consolidated financial statements.

 

F-5

 

 

SEATECH VENTURES CORP.

NOTES TO CONDENSED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2020

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(UNAUDITED)

 

1. DESCRIPTION OF BUSINESS AND ORGANIZATION

 

SEATech Ventures Corp. is organized as a Nevada limited liability company, incorporated on April 2, 2018. For purposes of consolidated financial statement presentation, SEATech Venture Corp. and its subsidiary are herein referred to as “the Company” or “we”.

 

The Company business of which planned principal operations are to provide business mentoring, nurturing and incubation services relating to client businesses and corporate development advisory services to entrepreneurs in the broader technology industry, but with a specific focus on the information and communication technology industry.

 

On May 2, 2018, the Company acquired 100% interest in SEATech Ventures Corp., a private limited liability company incorporated in Labuan, Malaysia.

 

On December 21, 2018, SEATech Ventures Corp., the Malaysia Company acquired SEATech Ventures (HK) Limited, a private limited company incorporated in Hong Kong.

 

Details of the Company’s subsidiaries:

 

  Company name   Place and date of
incorporation		   Particulars of issued capital   Principal activities
               
1. SEATech Ventures Corp.   Labuan / March 12, 2018   100 shares of ordinary share of US$1 each   Investment holding
               
2. SEATech Ventures (HK) Limited   Hong Kong / December 13, 2018  

1 ordinary share

of HKD$1

   Business mentoring, nurturing and incubation, and corporate development advisory services

 

F-6

 

 

SEATECH VENTURES CORP.

NOTES TO CONDENSED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2020

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(UNAUDITED)

 

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Basis of presentation

 

The consolidated financial statements for SEATech Ventures Corp. and its subsidiaries for the nine months ended September 30, 2020 is prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) and include the accounts of SEATech Ventures Corp. and its wholly owned subsidiaries, SEATech Ventures Corp. and SEATech Ventures (HK) Limited. Intercompany accounts and transactions have been eliminated on consolidation. The Company has adopted December 31 as its fiscal year end.

 

Basis of consolidation

 

The condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All inter-company accounts and transactions have been eliminated upon consolidation.

 

Use of estimates

 

Management uses estimates and assumptions in preparing these financial statements in accordance with US GAAP. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities in the balance sheets, and the reported revenue and expenses during the periods reported. Actual results may differ from these estimates.

 

Cash and cash equivalents

 

Cash and cash equivalents are carried at cost and represent cash on hand, demand deposits placed with banks or other financial institutions and all highly liquid investments with an original maturity of six months or less as of the purchase date of such investments.

 

F-7

 

 

SEATECH VENTURES CORP.

NOTES TO CONDENSED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2020

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(UNAUDITED)

 

Income taxes

 

Income taxes are determined in accordance with the provisions of ASC Topic 740, “Income Taxes” (“ASC Topic 740”). Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the periods in which those temporary differences are expected to be recovered or settled. Any effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

 

ASC 740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements uncertain tax positions taken or expected to be taken on a tax return. Under ASC 740, tax positions must initially be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions must initially and subsequently be measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and relevant facts.

 

Going Concern

 

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. As reflected in the accompanying financial statements, for the year ended September 30, 2020, the Company incurred a net loss of $78,791 and has generated minimal revenue. These factors raise substantial doubt about the Company’s ability to continue as a going concern within one year of the date that the financial statements are issued. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

 

The Company’s ability to continue as a going concern is dependent upon improving its profitability and the continuing financial support from its shareholders. Management believes the existing shareholders or external financing will provide the additional cash to meet the Company’s obligations as they become due. No assurance can be given that any future financing, if needed, will be available or, if available, that it will be on terms that are satisfactory to the Company. Even if the Company is able to obtain additional financing, if needed, it may contain undue restrictions on its operations, in the case of debt financing, or cause substantial dilution for its stock holders, in the case of equity financing.

 

F-8

 

 

SEATECH VENTURES CORP.

NOTES TO CONDENSED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2020

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(UNAUDITED)

 

Net income/(loss) per share

 

The Company calculates net income/(loss) per share in accordance with ASC Topic 260, “Earnings per Share.” Basic income/(loss) per share is computed by dividing the net income/(loss) by the weighted-average number of common shares outstanding during the period. Diluted income per share is computed similar to basic income/(loss) per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common stock equivalents had been issued and if the additional common shares were dilutive.

 

Foreign currencies translation

 

Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the Condensed Consolidated Statements of Operations and Comprehensive Income.

 

The reporting currency of the Company is United States Dollars (“US$”). The Company’s subsidiary in Labuan and Hong Kong maintains its books and record in United States Dollars (“US$”) respectively, and Ringgits Malaysia (“RM”) is functional currency as being the primary currency of the economic environment in which the entity operates.

 

In general, for consolidation purposes, assets and liabilities of its subsidiary whose functional currency is not US$ are translated into US$, in accordance with ASC Topic 830-30, “Translation of Financial Statement”, using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements of foreign subsidiary are recorded as a separate component of accumulated other comprehensive income within the statements of shareholders’ equity.

 

Translation of amounts from RM into US$1 and HK$ into US$1 has been made at the following exchange rates for the respective periods:

 

  

As of and for
the period ended

September 30, 2020

   As of and for
the period ended September 30, 2019		 
         
Period-end RM : US$1 exchange rate   4.1551    4.1800 
Period-average RM : US$1 exchange rate   4.2331    4.1600 
Period-end HK$: US$1 exchange rate   7.7500    7.8400 
Period-average HK$ : US$1 exchange rate   7.7581    7.8300 

 

Related parties

 

Parties, which can be a corporation or individual, are considered to be related if the Company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Companies are also considered to be related if they are subject to common control or common significant influence.

 

F-9

 

 

SEATECH VENTURES CORP.

NOTES TO CONDENSED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2020

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(UNAUDITED)

 

Fair value of financial instruments:

 

The carrying value of the Company’s financial instruments: cash and cash equivalents, account receivables, amount due to a director, and accounts payable and approximate at their fair values because of the short-term nature of these financial instruments.

 

The Company also follows the guidance of the ASC Topic 820-10, “Fair Value Measurements and Disclosures” (“ASC 820-10”), with respect to financial assets and liabilities that are measured at fair value. ASC 820-10 establishes a three-tier fair value hierarchy that prioritizes the inputs used in measuring fair value as follows:

 

Level 1: Observable inputs such as quoted prices in active markets;

 

Level 2: Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and

 

Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

 

Recent accounting pronouncements

 

FASB issues various Accounting Standards Updates relating to the treatment and recording of certain accounting transactions. On June 10, 2014, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2014-10, Development Stage Entities (Topic 915) Elimination of Certain Financial Reporting Requirements, including an Amendment to Variable Interest Entities Guidance in Topic 810, Consolidation, which eliminates the concept of a development stage entity (DSE) entirely from current accounting guidance. The Company has elected adoption of this standard, which eliminates the designation of DSEs and the requirement to disclose results of operations and cash flows since inception.

 

The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and do not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations.

 

F-10

 

 

SEATECH VENTURES CORP.

NOTES TO CONDENSED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2020

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(UNAUDITED)

 

3. COMMON STOCK

 

On April 2, 2018, the founder of the Company, Mr. Chin Chee Seong purchased 100,000 shares of restricted common stock of the Company at a par value of $0.0001 per share. The monies from this transaction, which totaled $10, went to the Company to be used as initial working capital.

 

On May 14, 2018, the Company issued 20,000,000 shares of restricted common stock to Chin Chee Seong and Seah Kok Wah respectively, with a par value of $0.0001 per share, for total additional working capital of $4,000.

 

On August 7, 2018, the Company issued 10,000,000 shares of restricted common stock to Greenpro Venture Capital Limited with a par value of $0.0001 per share, for total additional working capital of $1,000.

 

On August 8, 2018, the Company issued 30,000,000 shares of restricted common stock to Greenpro Asia Strategic Fund SPC, a company incorporated in Cayman Islands with a par value of $0.0001 per share, for additional working capital of $3,000.

 

On August 27, 2018, the Company issued 10,000,000 shares of restricted common stock to STVC Talent Sdn. Bhd, a company incorporated in Malaysia with a par value of $0.0001 per share, for additional working capital of $1,000.

 

On September 7, 2018, the Company sold shares to 2 shareholders, of whom reside in Malaysia. A total of 750,000 shares of restricted common stock were sold at a price of $0.10 per share. The total proceeds to the Company amounted to a total of $75,000.

 

On September 12, 2018, the Company sold shares to a shareholder, of whom reside in Malaysia. A total of 466,667 shares of restricted common stock were sold at a price of $0.15 per share. The total proceeds to the Company amounted to a total of $70,000.

 

In between September 21, 2018 and November 29, 2018, the Company sold shares to 44 shareholders, of whom reside in Malaysia. A total of 860,000 shares of restricted common stock were sold at a price of $0.20 per share. The total proceeds to the Company amounted to a total of $172,000.

 

From June 12, 2019 to May 4, 2020, the company issued 343,200 shares of common stock at a price of $1.00 per share through the Initial Public Offering (IPO) to 70 non-US residents.

 

As of September 30, 2020, SEATech Ventures Corp. has an issued and outstanding common share of 92,519,867.

 

4. CASH AND CASH EQUIVALENTS

 

As at September 30, 2020, the Company recorded $306,950 of cash and cash equivalents which primarily consists of cash in bank.

 

5. INVESTMENT IN OTHER COMPANIES

 

  

As of
September 30, 2020
(Audited)

  

As of

December 31, 2019

(Audited)

 
AsiaFIN Holding Corp1   1,015    1,015 
Total investment in other companies  $1,015   $1,015 

 

1On December 24, 2019, the company has invested in AsiaFIN Holdings Corp during the private placement stage. AsiaFIN Holdings Corp is a company providing business technology solutions to its clients. SEATech Ventures Corp. also provides corporate development, mentoring, and incubation service to AsiaFIN Holdings Corp. The investment in AsiaFIN Holdings Corp is a strategic investment of the company and the company’s efforts on nurturing and providing collaborating and networking opportunities to ICT entrepreneurs across Asia. The investment is also aligning with the company’s focus on the ICT industry.

 

6. OTHER PAYABLES AND ACCRUED LIABILITIES

 

Other payables and accrued liabilities consisted of the following at September 30, 2020 and December 31, 2019:

 

  

As of
September 30, 2020

(Unaudited)

  

As of
December 31, 2019

(Audited)

 
Accrued audit fees  $5,180   $13,356 
Accrued professional fees   2,080    - 
Accrued expenses   1,309    - 
Share subscription receipts in advance   -    291,300 
Total payables and accrued liabilities  $8,569   $304,656 

 

F-11

 

 

SEATECH VENTURES CORP.

NOTES TO CONDENSED FINANCIAL STATEMENT

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2020

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(UNAUDITED)

 

7. AMOUNT DUE TO A DIRECTOR

 

As of September 30, 2020, a director of the Company advanced $1,631 respectively to the Company, which is unsecured, interest-free with no fixed repayment term, for working capital purpose. Imputed interest is considered insignificant.

 

  

As of

September 30, 2020

(Unaudited)

  

As of

December 31, 2019

(Audited)

 
Amount due to a director   1,631    1,631 
           
Total amount due to a director  $1,631   $1,631 

 

8. INCOME TAXES

 

For the nine months ended September 30, 2020, the local (United States) and foreign components of income/ (loss) before income taxes were comprised of the following:

 

  

Nine months ended
September 30, 2020

(Unaudited)

  

Nine months ended
September 30, 2019

(Unaudited)

 
         
Tax jurisdictions from:          
Local  $(35,744)  $(146,790)
Foreign, representing          
- Labuan   (25,034)   (2,685)
- Hong Kong  $(18,013)  $(29,720)
Loss before income tax  $(78,791)  $(179,195)

 

The provision for income taxes consisted of the following:

 

 

    For the period ended
September 30, 2020 		    For the year ended
December 31, 2019 		 
Current:          
- Local   -    - 
- Foreign   -    - 
Deferred:          
- Local   -    - 
- Foreign   -    - 
           
Income tax expense  $-   $- 

 

The effective tax rate in the periods presented is the result of the mix of income earned in various tax jurisdictions that apply a broad range of income tax rates. The Company has subsidiaries that operate in various countries: United States Labuan and Hong Kong that are subject to taxes in the jurisdictions in which they operate, as follows:


United States of America

 

The Company is registered in the State of Nevada and is subject to the tax laws of the United States of America. As of September 30, 2020, the operations in the United States of America incurred $370,264 of cumulative net operating losses which can be carried forward to offset future taxable income, at the tax rate of 21%. The net operating loss carry forwards begin to expire in 2038, if unutilized. The Company has provided for a full valuation allowance of $77,755 against the deferred tax assets on the expected future tax benefits from the net operating loss carry forwards as the management believes it is more likely than not that these assets will not be realized in the future.

 

Labuan

 

Under the current laws of the Labuan, SEATech Ventures Corp. is governed under the Labuan Business Activity Act, 1990. The tax charge for such company is based on 3% of net audited profit.

 

Hong Kong

 

SEATech Ventures Corp. is subject to Hong Kong Profits Tax, which is charged at the statutory income tax rate of 16.5% on its assessable income.

 

F-12

 

 

SEATECH VENTURES CORP.

NOTES TO CONDENSED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2020

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(UNAUDITED)

 

 

9. COMMITMENTS AND CONTINGENCIES

 

As of September 30, 2020, the Company has no commitments or contingencies involved.

 

10. RELATED PARTY TRANSACTIONS

 

For the period ended September 30, 2020 the Company has the following transactions with related party:

 

  

For the period
ended
September 30, 2020

(Unaudited)

  

For the period
ended

September 30, 2019

(Unaudited)

 
Cost of Revenue:          
- Related party A  $-   $18,720 
           
Company Secretary Fees :          
- Related party A  $5,000   $5,080 
           
Professional Fees:          
- Related party A  $53,600   $140,000 

 

The related party A, through its wholly owned subsidiaries is a 43.4% shareholder of the Company.

 

11. SIGNIFICANT EVENT

 

During the fiscal year, the World Health Organization declared the Coronavirus (COVID-19) outbreak to be a pandemic, which has caused severe global social and economic disruptions and uncertainties, including markets where the Company operates.

 

The Company considers this outbreak as non-adjusting-events. The consequences brought about by Covid-19 continue to evolve and whilst the Company actively monitoring and managing its operations to respond to these changes, the Company does not consider it practicable to provide any quantitative estimate on the potential impact it may have on the Company.

 

12. SUBSEQUENT EVENT

 

In accordance with ASC Topic 855, “Subsequent Events”, which establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued, the Company has evaluated all events or transactions that occurred after September 30, 2020 up through the date the Company issued the audited consolidated financial statements. During this period, there was no subsequent event that required recognition or disclosure.

 

F-13

 

 

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

The information contained in this quarter report on Form 10-Q is intended to update the information contained in our Form S-1 Amendment No.3, dated May 30, 2019, for the period ended June 30, 2019 and presumes that readers have access to, and will have read, the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and other information contained in such Form S-1. The following discussion and analysis also should be read together with our consolidated financial statements and the notes to the consolidated financial statements included elsewhere in this Form 10-Q.

 

The following discussion contains certain statements that may be deemed “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements appear in a number of places in this Report, including, without limitation, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” These statements are not guarantees of future performance and involve risks, uncertainties and requirements that are difficult to predict or are beyond our control. Forward-looking statements speak only as of the date of this quarterly report. You should not put undue reliance on any forward-looking statements. We strongly encourage investors to carefully read the factors described in our Form S-1 Amendment No.3, dated May 30, 2019, in the section entitled “Risk Factors” for a description of certain risks that could, among other things, cause actual results to differ from these forward-looking statements. We assume no responsibility to update the forward-looking statements contained in this transition report on Form 10-Q. The following should also be read in conjunction with the unaudited Condensed Consolidated Financial Statements and notes thereto that appear elsewhere in this report.

 

Company Overview

 

SEATech Ventures Corp., the US Company, operates through its wholly owned subsidiary, SEATech Ventures Corp., a Labuan Company; which operates through its wholly owned subsidiary, SEATech Ventures (HK) Limited, a Hong Kong Company; The US, Labuan act solely for holding purposes whereas all current and future operations in Hong Kong are planned to be carried out via SEATech Ventures (HK) Limited, the Hong Kong Company. The purpose of the Hong Kong Company is to function as the current regional hub, carrying out the majority of operations of the Company.

 

All of the previous entities share the same exact business plan with the goal of providing business mentoring services, nurturing and incubation services relating to client businesses and corporate development advisory services to entrepreneurs in the broader technology industry, but with a specific focus on the information and communication technology industry. We will, at least initially, primarily focus our efforts on nurturing ICT entrepreneurs in Asia. Our advisory services will center on our “ICT Start-Up Mentorship Program”, which is designed to assist tech-based entrepreneurs in solving ICT industry pain points caused by technical insufficiencies, inappropriate financial modelling and weak strategic positioning within a competitive environment.

 

3

 

 

Results of Operation

 

For the nine months ended September 30, 2020 and 2019

 

Revenues

 

For nine months ended September 30, 2020 and 2019, the Company has generated revenue of $55,381 and $28,507. The revenue generated was the result of corporate development advisory service rendered by the Company.

 

Cost of Revenue and Gross Margin

 

For the nine months ended September 30, 2020 and 2019, cost incurred arise in providing corporate development advisory services are $50,000 and $18,720, and the company generates a gross profit of $5,381 and $9,787 the for the nine months ended September 30, 2020 and 2019.

 

Selling and marketing expenses

 

For the nine months ended September 30, 2020 and 2019, we had selling and distribution expenses in the amount of $14,020 and $25,461, which was primarily comprised of marketing expenses and expenses incurred for selling of services.

 

General and administrative expenses

 

For the nine months ended September 30, 2020 and 2019, we had general and administrative expenses in the amount of $73,843 and $163,543 which was primarily comprised of company renewal fee, employee salary, and employee reimbursement.

 

Net Loss

 

For the nine months ended September 30, 2020 and 2019, the Company has incurred a net loss of $78,791 and $179,195. The loss is mainly derived from the general and administrative expenses.

 

4

 

 

Liquidity and Capital Resources

 

As of September 30, 2020, we had cash and cash equivalents of $306,950. We had positive operating cash flows due to minimal operating activity, we expect increased levels of operating activities going forward will result in more significant cash outflows.

 

We depend substantially on financing activities to provide us with the liquidity and capital resources we need to meet our working capital requirements and to make capital investments in connection with ongoing operations. For the nine months ended September 30, 2020, we have met these requirements primarily from previous sales of our common stock.

 

Cash Used In Operating Activities

 

For the nine months ended September 30, 2020 and 2019, net cash used in operating activities was $376,060 and $169,195 respectively, which were the result of our net loss attributable to selling and marketing costs, and general and administration expenses.

 

Credit Facilities

 

We do not have any credit facilities or other access to bank credit.

 

Off-balance Sheet Arrangements

 

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to our stockholders as of September 30, 2020.

 

 

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.

 

5

 

 

ITEM 3 QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide information required by this Item.

 

ITEM 4 CONTROLS AND PROCEDURES

 

Evaluation of Disclosure Controls and Procedures:

 

We carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of September 30, 2020. This evaluation was carried out under the supervision and with the participation of our Chief Executive Officer and our Chief Investment Officer. Based upon that evaluation, our Chief Executive Officer and Chief Investment Officer concluded that, as of September 30, 2020, our disclosure controls and procedures were not effective due to the presence of material weaknesses in internal control over financial reporting.

 

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis. Management has identified the following material weaknesses which have caused management to conclude that, as of September 30, 2020, our disclosure controls and procedures were not effective: (i) inadequate segregation of duties and effective risk assessment; and (ii) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of both US GAAP and SEC guidelines.

 

Changes in Internal Control over Financial Reporting:

 

There were no changes in our internal control over financial reporting during the quarter ended September 30, 2020, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

6

 

 

PART II — OTHER INFORMATION

 

Item 1. Legal Proceedings

 

We know of no materials, active or pending legal proceedings against us, nor are we involved as a plaintiff in any material proceedings or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any beneficial shareholder are an adverse party or has a material interest adverse to us.

 

Item 1A. Risk Factors.

 

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

 

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

 

None

 

Item 3. Defaults Upon Senior Securities

 

None

 

Item 4. Mine Safety Disclosures

 

Not applicable.

 

Item 5. Other Information.

 

None

 

7

 

 

ITEM 6. Exhibits

 

Exhibit No.   Description
     
31.1   Rule 13(a)-14(a)/15(d)-14(a) Certification of principal executive officer*
     
31.2   Rule 13(a)-14(a)/15(d)-14(a) Certification of principal investment officer*
     
32.1   Section 1350 Certification of principal executive officer *
     
32.2   Section 1350 Certification of principal investment officer *
     
101.INS   XBRL Instance Document*
     
101.SCH   XBRL Schema Document*
     
101.CAL   XBRL Calculation Linkbase Document*
     
101.DEF   XBRL Definition Linkbase Document*
     
101.LAB   XBRL Label Linkbase Document*
     
101.PRE   XBRL Presentation Linkbase Document*

 

* Filed herewith.

 

8

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

  SEATech Ventures Corp.
  (Name of Registrant)
     
Date: November 11, 2020    
  By: /s/ CHIN CHEE SEONG
  Title:

Chief Executive Officer,

President, Director, Secretary and Treasurer

 

Date: November 11, 2020 By: /s/ SEAH KOK WAH
  Title: Chief Investment Officer, Director

 

9