DISCLOSURE STATEMENT PURSUANT TO THE PINK BASIC DISCLOSURE GUIDELINES
Agavenny Corporation
1605 W. Olympic Boulevard, Suite 1046
Los Angeles, CA 90015
Tel. 626 773 6538
e-mail: info@agavenny.com
SIC Code 7389
Annual Report
For the Period Ending: September 30, 2020
(the “Reporting Period”)
As of September 30, 2020, the number of shares outstanding of our Common Stock was: 15,375,000
As of September 30, 2019, the number of shares outstanding of our Common Stock was: 15,375,000
As of September 30, 2018, the number of shares outstanding of our Common Stock was: 15,375,000
Indicate by check mark whether the company is a shell company (as defined in Rule 405 of the Securities Act of 1933 and Rule 12b-2 of the Exchange Act of 1934):
Yes: ☐ No: ☒
Indicate by check mark whether the company’s shell status has changed since the previous reporting period:
Yes: ☐ No: ☒
Indicate by check mark whether a Change in Control1 of the company has occurred over this reporting period:
Yes: ☐ No: ☒
1) Name of the issuer and its predecessors (if any): Agavenny Corporation
In answering this item, please also provide any names used by predecessor entities and the dates of the name changes.
NONE
1 “Change in Control” shall mean any events resulting in:
(i) Any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) becoming the “beneficial owner” (as defined in Rule 13d-3 of the Exchange Act), directly or indirectly, of securities of the Company representing fifty percent (50%) or more of the total voting power represented by the Company’s then outstanding voting securities;
(ii) The consummation of the sale or disposition by the Company of all or substantially all of the Company’s assets;
(iii) A change in the composition of the Board occurring within a two (2)-year period, as a result of which fewer than a majority of the directors are directors immediately prior to such change; or
(iv) The consummation of a merger or consolidation of the Company with any other corporation, other than a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or its parent) at least fifty percent (50%) of the total voting power represented by the voting securities of the Company or such surviving entity or its parent outstanding immediately after such merger or consolidation.
Date and state (or jurisdiction) of incorporation (also describe any changes to incorporation since inception, if applicable) Please also include the issuer’s current standing in its state of incorporation (e.g. active, default, inactive): ACTIVE AND IN GOOD STANDING
Date of Incorporation: September 24, 2002
State of Incorporation: Colorado
Has the issuer or any of its predecessors been in bankruptcy, receivership, or any similar proceeding in the past five years?
Yes: ☐No: ☒
If this issuer or any of its predecessors have been the subject of such proceedings, please provide additional details in the space below:
NONE
2) Security Information
| Trading symbol: | CVCS |
| Exact title and class of securities outstanding: | Common Stock |
| CUSIP: | 161199 104 |
| Par or stated value: | Without par value |
| Total shares authorized: | 100,000,000 as of date: 9/30/20 |
| Total shares outstanding: | 15,375,000 as of date: 9/30/20 |
| Number of shares in the Public Float2: | 1,125,000 as of date: 9/30/20 |
| Total number of shareholders of record: | 39 as of date: 9/30/20 |
Transfer Agent
| Name: | Securities Stock Transfer |
| Phone: | 469-633-0101 |
| Email: | johnson@stctransfer.com |
Is the Transfer Agent registered under the Exchange Act?3 Yes: ☒No: ☐
Describe any trading suspension orders issued by the SEC concerning the issuer or its predecessors:
NONE
2 “Public Float” shall mean the total number of unrestricted shares not held directly or indirectly by an officer, director, any person who isthe beneficial owner of more than 10 percent of the total shares outstanding (a “control person”), or any affiliates thereof, or any immediate family members of officers, directors and control persons.
3 To be included in the Pink Current Information tier, the transfer agent must be registered under the Exchange Act.
List any stock split, stock dividend, recapitalization, merger, acquisition, spin-off, or reorganization either currently anticipated or that occurred within the past 12 months: NONE
3) Issuance History
The goal of this section is to provide disclosure with respect to each event that resulted in any direct changes to the total shares outstanding of any class of the issuer’s securities in the past two completed fiscal years and any subsequent interim period.
Disclosure under this item shall include, in chronological order, all offerings and issuances of securities, including debt convertible into equity securities, whether private or public, and all shares, or any other securities or options to acquire such securities, issued for services. Using the tabular format below, please describe these events.
A. Changes to the Number of Outstanding Shares
Check this box to indicate there were no changes to the number of outstanding shares within the past two completed fiscal years and any subsequent period: ☒
Shares Outstanding as of Second Most Recent Fiscal Year End: Opening Balance Date Common Preferred |
*Right-click the rows below and select “Insert” to add rows as needed. | Date of Transaction | Transaction type (e.g. newissuance, cancellation, shares returned to treasury) | Number of Shares Issued (or cancelled) | Class of Securities | Value of shares issued ($/per share) at Issuance | Were the shares issued at a discountto market price at the time ofissuance? (Yes/No) | Individual/ Entity Shares were issued to (entities must have individual with voting / investment control disclosed). | Reason for shareissuance (e.g. forcash or debt conversion) -OR- Nature of Services Provided | Restricted or Unrestricted as of this filing. | Exemption orRegistration Type. | Shares Outstanding on Date of This Report: Ending Balance: Date Common Preferred: |
|---|---|---|---|---|---|---|---|---|---|
Example: A company with a fiscal year end of December 31st, in addressing this item for its quarter ended September 30, 2019, would include any events that resulted in changes to any class of its outstanding shares from the period beginning on January 1, 2017 through September 30, 2019 pursuant to the tabular format above.
Use the space below to provide any additional details, including footnotes to the table above:
B. Debt Securities, Including Promissory and Convertible Notes
Check this box to indicate there were no changes to the number of outstanding shares within the past two completed fiscal years and any subsequent period: ☒
Use the chart and additional space below to list and describe all outstanding promissory notes, convertible notes, convertible debentures, or any other debt instruments that may be converted into a class of the issuer’s equity securities.
Check this box if there are no outstanding promissory, convertible notes or debt arrangements: ☒
Disclosure Statement of Charter Corporate Services, Inc.
| Date of Note Issuance | OutstandingBalance ($) | Principal Amount at Issuance ($) | Interest Accrued($) | MaturityDate | Conversion Terms (e.g. pricing mechanism for determining conversion of instrument to shares) | Name of Noteholder (entities must have individual with voting/ investment control disclosed). | Reason for Issuance (e.g. Loan, Services,etc.) |
Use the space below to provide any additional details, including footnotes to the table above:
While the company has not issued any form of debt securities and no third parties hold any promissory notes evidencing Company debt, as of September 30, 2020, the Company is indebted to a related party, Brooks Family Irrevocable Trust (“Trust”) for advances made on the Company’s behalf spanning a period of 10 years. As shown on our balance sheet, as of September 30, 2020, the debt was $53,953.
There are no terms and conditions to the advances, including but not limited to, interest rate or a repaymentschedule. However, it is assumed by the Company that the loan is non-interest bearing and repayment will be made by the Company if, and when, it is financially able to do so. There is no assurance that the Trust will, in the future, continue to make advances on our behalf for expenses incurred. Our debt to the Trust is payable on demand. Interest may be assessed in any amount to avoid any imputed income.
4) Financial Statements
A. The following financial statements were prepared in accordance with:
☒ U.S. GAAP
☐ IFRS
B. The financial statements for this reporting period were prepared by (name of individual)4:
Name: Patrick Brooks
Title: Chief Financial Officer
Relationship to Issuer: Officer and director
Provide the financial statements described below for the most recent fiscal year or quarter. For the initial disclosure statement (qualifying for Pink Current Information for the first time) please provide reports for the two previous fiscal years and any subsequent interim periods.
C. Balance sheet;
D. Statement of income;
E. Statement of cash flows;
F. Statement of Changes in Shareholders’ Equity
G. Financial notes; and
H. Audit letter, if audited
You may either (i) attach/append the financial statements to this disclosure statement or (ii) file the financial statements through OTCIQ as a separate report using the appropriate report name for the applicable period end.(“Annual Report,” “Quarterly Report” or “Interim Report”).
If you choose to publish the financial statements in a separate report as described above, you must state in the accompanying disclosure statement that such financial statements are incorporated by reference. You may reference the document(s) containing the required financial statements by indicating the document name, period
4 The financial statements requested pursuant to this item must be prepared in accordance with US GAAP or IFRS by persons with sufficient financial skills.
end date, and the date that it was posted to OTCIQ in the field below. Financial Statements must be compiled in one document.
Annual Financial Statements attached hereto.
Financial statement information is considered current until the due date for the subsequent report (as set forth in the qualifications section above). To remain qualified for Current Information, a company must post its Annual Report within 90 days from its fiscal year-end date and Quarterly Reports within 45 days of each fiscal quarter-end date.
5) Issuer’s Business, Products and Services
The purpose of this section is to provide a clear description of the issuer’s current operations. In answering this item, please include the following:
A. Summarize the issuer’s business operations (If the issuer does not have current operations, state “no operations”)
Through a wholly-owned subsidiary, OmniCertify, Inc., we provide Certification Services to businesses. Certification is a process to qualify businesses owned, controlled, and operated by minorities, women, and other eligible groups for government and non-governmental organization programs and opportunities.
B. Describe any subsidiaries, parents, or affiliated companies, if applicable, and a description of such entity’s business, contact information for the business, officers, directors, managers or control persons. Subsidiary information may be included by reference
Wholly-owned subsidiary: OmniCertify, Inc. This subsidiary is the operational arm of our business as described i above. Our sole officer and director also serves as sole officer and director of OmniCertify, Inc.
C. Describe the issuers’ principal products or services, and their markets.
Consulting services for certification of businesses that are owned, controlled and operated by women, minority or other qualifying individual applicants to meet the eligibility criteria of individual certifying programsfrom entities such as government agencies and public and private sector corporations.
6) Issuer’s Facilities
The goal of this section is to provide a potential investor with a clear understanding of all assets, properties or facilities owned, used or leased by the issuer.
In responding to this item, please clearly describe the assets, properties or facilities of the issuer, give the location of the principal plants and other property of the issuer and describe the condition of the properties. If theissuer does not have complete ownership or control of the property (for example, if others also own the property or if there is a mortgage on the property), describe the limitations on the ownership.
If the issuer leases any assets, properties or facilities, clearly describe them as above and the terms of their leases.
Pursuant to an oral agreement, we use a corporate office located at 1605 W. Olympic Boulevard, Suite1040, Los Angeles, CA 90015. Shared office space is provided to us by an unaffiliated party at a cost of$400 per month, on a month-to-month basis. This includes administrative and technological services andsecretarial support. The facilities as provided, are adequate for the Company’s needs for the foreseeablefuture.
7) Officers, Directors, and Control Persons
The goal of this section is to provide an investor with a clear understanding of the identity of all the persons or entities that are involved in managing, controlling or advising the operations, business development and disclosure of the issuer, as well as the identity of any significant or beneficial shareholders.
Using the tabular format below, please provide information, as of the period end date of this report, regarding any person or entity owning 5% of more of any class of the issuer’s securities, as well as any officer, and any director of the company, regardless of the number of shares they own. If any listed are corporate shareholders or entities, provide the name and address of the person(s) beneficially owning or controlling such corporate shareholders, or the name and contact information of an individual representing the corporation or entity in the note section.
| Name of Officer/Director or Control Person | Affiliation with Company (e.g. Officer/Director/Ownerof more than 5%) | Residential Address (City / State Only) | Number of shares owned | Share type/class | Ownership Percentage of Class Outstanding | Note |
|---|---|---|---|---|---|---|
| Patrick Brooks | Officer and Director | Redondo Beach, CA | 0 | Common | 0 | Mr. Brooks may be deemed to be the beneficial owner of the shares held by the Brooks Family Irrevocable Trust. He is a trustee but not a beneficiary of the Trust. Mr. Brooks disclaims any beneficial interest in the shares held by the Trust. |
| Brooks Family Irrevocable Trust | Stockholder | Redondo Beach, CA | 13,500,000 | Common | 87.8 |
8) Legal/Disciplinary History
A. Please identify whether any of the persons listed above have, in the past 10 years, been the subject of:
- 1. A conviction in a criminal proceeding or named as a defendant in a pending criminal proceeding (excluding traffic violations and other minor offenses);
NO
- 2. The entry of an order, judgment, or decree, not subsequently reversed, suspended or vacated, by a court of competent jurisdiction that permanently or temporarily enjoined, barred, suspended or otherwise limited such person’s involvement in any type of business, securities, commodities, or banking activities;
NO
- 3. A finding or judgment by a court of competent jurisdiction (in a civil action), the Securities and Exchange Commission, the Commodity Futures Trading Commission, or a state securities regulator of a violation of federal or state securities or commodities law, which finding or judgment has not been reversed, suspended, or vacated; or
NO
- 4. The entry of an order by a self-regulatory organization that permanently or temporarily barred, suspended, or otherwise limited such person’s involvement in any type of business or securities activities.
NO
B. Describe briefly any material pending legal proceedings, other than ordinary routine litigation incidental to the business, to which the issuer or any of its subsidiaries is a party or of which any of their property is the subject. Include the name of the court or agency in which the proceedings are pending, the date instituted, the principal parties thereto, a description of the factual basis alleged to underlie the proceeding and the relief sought. Include similar information as to any such proceedings known to be contemplated by governmental authorities.
NONE
9) Third Party Providers
Please provide the name, address, telephone number and email address of each of the following outside providers:
Securities Counsel
| Name: | Richard Byron Peddie |
| Firm: | Lawstudios | Richard Byron Peddie, P.C. |
| Address 1: | 5051 Euclid Avenue |
| Address 2: | Boulder, CO 80303 |
| Phone: | 303 444 5447 |
| Email: | lawstudios@comcast.net |
Auditor
| Name: | |
| Firm: | Simon & Edward, LLP |
| Address 1: | 3230 Fallow Field Drive |
| Address 2: | Diamond Bar, CA 91765 |
| Phone: | 909 839 9222 |
| Email: | simon@secpa.us |
Investor Relations NONE
| Name: | |
| Firm: | |
| Address 1: | |
| Address 2: | |
| Phone: | |
| Email: |
Other Service Providers NONE
Provide the name of any other service provider(s) that that assisted, advised, prepared or provided information with respect to this disclosure statement. This includes counsel, advisor(s) or consultant(s) or provided assistance or services to the issuer during the reporting period.
| Name: | |
| Firm: | |
| Nature of Services: | |
| Address 1: | |
| Address 2: | |
| Phone: | |
| Email: |
10) Issuer Certification
Principal Executive Officer:
The issuer shall include certifications by the chief executive officer and chief financial officer of the issuer (or any other persons with different titles but having the same responsibilities).
The certifications shall follow the format below:
I, Patrick Brooks certify that:
- 1. I have reviewed this annual report of Charter Corporate Services, Inc.;
- 2. Based on my knowledge, this disclosure statement 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 disclosure statement; and
- 3. Based on my knowledge, the financial statements, and other financial information included or incorporated by reference in this disclosure statement, fairly present in all material respects the financial condition, results of operations and cash flows of the issuer as of, and for, the periods presented in this disclosure statement.
January 12, 2021
/s/ Patrick Brooks
Principal Executive Officer
Principal Financial Officer
I, Patrick Brooks certify that:
- 1. I have reviewed this annual disclosure statement of Charter Corporate Services, Inc.
- 2. Based on my knowledge, this disclosure statement 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 disclosure statement; and
- 3. Based on my knowledge, the financial statements, and other financial information included or incorporated by reference in this disclosure statement, fairly present in all material respects the financial condition, results of operations and cash flows of the issuer as of, and for, the periods presented in this disclosure statement.
January 12, 2021
/s/ Patrick Brooks
Principal Financial Officer
Agavenny Corporation UNAUDITED CONSOLIDATED BALANCE SHEETS
| For the years ended September 30, | ||
|---|---|---|
| 2020 | 2019 | |
| Assets | ||
| Current Assets: | ||
| Cash and Cash Equivalents | $2 | $2 |
| Total Current Assets | 2 | 2 |
| Goodwill | 1,350,000 | 1,350,000 |
| Total Assets | $1,350,002 | $1,350,002 |
| Liabilities and Stockholders’ Equity (Deficit) | ||
| Accounts Payable and Accrued Expenses | $32,486 | $28,693 |
| Loan Payable-Related Party | 53,953 | 44,173 |
| Total Liabilities | 86,439 | 72,866 |
| Stockholders’ Equity (Deficit): | ||
| Preferred Stock, 50,000,000 authorized, 0 issued, no par value | – | – |
| Common Stock, 100,000,000 shares authorized, 15,375,000 shares issued and outstandingno par value | – | – |
| Additional Paid in Capital | 1,462,500 | 1,462,500 |
| Deficit during the development stage | (198,937) | (185,364) |
| Total Stockholder’s Equity (Deficit) | 1,263,563 | 1,277,136 |
| Total Liabilities and Stockholders’ Equity | $1,350,002 | $1,350,002 |
The accompanying notes are an integral part of these consolidated financial statements.
F-1
Agavenny Corporation UNAUDITED CONSOLIDATED STATEMENT OF OPERATIONS
| For the years ended September 30 | From inception September 24, 2020 to September 30, | ||
|---|---|---|---|
| 2020 | 2019 | 2020 | |
| Revenues | $- | $- | $- |
| Expenses | |||
| Stock for Services | – | – | 67,000 |
| General & Administration | 13,573 | 8,403 | 92,982 |
| Professional Fees and Licensing costs | – | – | 49,255 |
| Total | 13,573 | 8,403 | 209,237 |
| Loss from Operations | (13,573) | (8,403) | (209,237) |
| Other Income (expense) | – | – | 10,300 |
| Net Profit (Loss) | $(13,573) | $(8,403) | $(198,937) |
| Profit (Loss) Per Share | $(0.00) | $(0.00) | |
| Weighted Average Shares Outstanding | 15,375,000 | 15,375,000 | |
The accompanying notes are an integral part of these consolidated financial statements.
F-2
Agavenny Corporation UNAUDITED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)
| Common Stock | |||||
|---|---|---|---|---|---|
| Shares | Amount | APIC | Retained Earnings (Deficit) | Total | |
| Balance, September 30, 2018 | 15,375,000 | – | 1,462,500 | (176,961) | 1,285,539 |
| Net loss | – | – | – | (8,403) | (8,403) |
| Balance, September 30, 2019 | 15,375,000 | – | 1,462,500 | (185,364) | 1,277,136 |
| Net loss | – | – | – | (13,573) | (13,573) |
| Balance, September 30, 2020 | 15,375,000 | $- | $1,462,500 | $(198,937) | $1,263,563 |
The accompanying notes are an integral part of these consolidated financial statements.
F-3
Agavenny Corporation UNAUDITED CONSOLIDATED STATEMENT OF CASH FLOWS
| For the years ended September 30, | From Inception September 24, 2002 to September 30, | ||
|---|---|---|---|
| 2020 | 2019 | 2020 | |
| Cash Flows from Operating Activities: | |||
| Net Profit (Loss) | $(13,573) | $(8,403) | $(198,937) |
| Adjustments to reconcile net loss to | |||
| cash used by operating activities | |||
| Share Issuance | – | – | 67,000 |
| Increase in Accounts Payable | 3,793 | 4,820 | 32,486 |
| Cash Provided (Used) By Operations | (9,780) | (3,583) | (99,451) |
| Net Cash Used by Investing Activities | – | – | – |
| Cash Provided by Investing Activities | – | – | – |
| Net Cash Provided by Financing Activities | |||
| Proceeds of Contribution | – | – | 45,500 |
| Increase in Loan Payable-Related Party | 9,780 | 3,583 | 53,953 |
| Increase (Decrease) in Cash | – | – | 2 |
| Cash-Beginning | 2 | 2 | – |
| Cash-End | $2 | $2 | $2 |
| Supplemental disclosures: | |||
| Income Taxes paid | $- | $- | $- |
| Interest Expense | $- | $- | $- |
The accompanying notes are an integral part of these consolidated financial statements.
F-4
Agavenny Corporation NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2020
NOTE 1 – ORGANIZATION AND SIGNIFICANT ACCOUTNING POLICIES
Organization and Line of Business
Charter Corporate Services, Inc. provides Certification Services through its wholly-owned subsidiary, OmniCertify, Inc. Certification is a process to determine and enable businesses that are owned, controlled and operated by women, minority or other qualifying individual applicants to meet the eligibility criteria of individual certifying programs from entities such as government agencies and public and private sector corporations.
Basis of Presentation
The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America.
Business Condition
These accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. As of September 30, 2020 the Company had operating losses, and no real business. The continuation of the Company is dependent upon improved economic conditions, financial support, as well as becoming profitable.
These conditions raise substantial doubt about the Company’s ability to continue as a going concern. These financial statements do not include any adjustments that might arise from this uncertainty.
Stock Based Compensation
ASC 718 Compensation — Stock Compensation establishes and encourages the use of the fair value based method of accounting for stock-based compensation arrangements under which compensation cost is determined using the fair value of stock-based compensation determined as of the date of grant and is recognized over the periods in which the related services are rendered. For stock based compensation the Company recognizes an expense in accordance with ASC 718 and values the equity securities based on the fair value of the security on the date of grant. Stock option awards are valued using the Black-Scholes option-pricing model.
No stock compensation expense was incurred during the years ended September 30, 2020 and 2019, respectively.
Use of Estimates
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 disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from these estimates.
Fair Value of Financial Instruments
For certain of the Company’s financial instruments, including cash and cash equivalents, other current assets, accounts payable, accrued interest and due to related party, the carrying amounts approximate fair value due to their short maturities.
Cash and Cash Equivalents
For purposes of the statements of cash flows, the Company defines cash equivalents as all highly liquid debt instruments purchased with a maturity of three months or less, plus all certificates of deposit.
Concentration of Credit Risk
Financial instruments, which potentially subject the Company to concentrations of credit risk, consist of cash and cash equivalents and accounts receivables. The Company places its cash with high quality financial institutions and at times may exceed the FDIC $250,000 insurance limit. The Company extends credit based on an evaluation of the customer’s financial condition, generally without collateral. Exposure to losses on receivables is principally dependent on each customer’s financial condition. The Company monitors its exposure for credit losses and maintains allowances for anticipated losses, as required
Impairment of Long-Lived Assets
ASC 350 requires that long-lived assets to be disposed of by sale, including those of discontinued operations, be measured at the lower of carrying amount or fair value less cost to sell, whether reported in continuing operations or in discontinued operations. ASC 350 broadens the reporting of discontinued operations to include all components of an entity with operations that can be distinguished from the rest of the entity and that will be eliminated from the ongoing operations of the entity in a disposal transaction. ASC 350 also establishes a “primary-asset” approach to determine the cash flow estimation period for a group of assets and liabilities that represents the unit of accounting for a long-lived asset to be held and used.
Advertising Costs
These costs are expensed as incurred. During the periods there was no advertising expense.
Income Taxes
The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, the Company determines deferred tax assets and liabilities on the basis of the differences between the financial statement and tax bases of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date.
The Company recognizes deferred tax assets to the extent that it believes that these assets are more likely than not to be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. If the Company determines that it would be able to realize its deferred tax assets in the future in excess of their net recorded amount, the Company would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes.
The Company records uncertain tax positions in accordance with ASC 740 on the basis of a two-step process in which (1) it determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, it recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority.
Earnings Per share
The Company reports earnings (loss) per share in accordance with ASC 260, “Earnings per Share.” Basic earnings (loss) per share is computed by dividing income (loss) available to common shareholders by the weighted average number of common shares available. Diluted earnings (loss) per share is computed similar to basic earnings (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 shares had been issued and if the additional common shares were dilutive. Diluted earnings (loss) per share has not been presented since the effect of the assumed conversion of options and warrants to purchase common shares would have an anti-dilutive effect.
Recent Accounting Pronouncements
Adopted During the Year Ended September 30, 2020
In February 2016, the FASB issued ASU 2016-02 related to the accounting for leases. This pronouncement requires lessees to record most leases on their balance sheet, while expense recognition on the income statement remains similar to current lease accounting guidance. The guidance also eliminates real estate-specific provisions and modifies certain aspects of lessor accounting. Under the new guidance, lease classification as either a finance lease or an operating lease will determine how lease-related revenue and expense are recognized. The pronouncement is effective for the Company’s fiscal year beginning October 1, 2019, and for interim periods within that fiscal year. The adoption of this standard did not have an impact on the consolidated financial statements because leases are month-to-month and not material to the Company’s financial statements.
The Company has reviewed all other recently issued, but not yet adopted, accounting standards, in order to determine their effects, if any, on its results of operations, financial position or cash flows. Based on that review, the Company believes that none of these pronouncements will have a significant effect on its financial statements.
NOTE 2- COMMON STOCK TRANSACTIONS
The company has authorized 100,000,000 shares and 15,375,000 shares were issued and outstanding as of September 30, 2020 and 2019, respectively.
NOTE 3-COMMITMENTS AND CONTINGENCIES
The Company thru its majority stockholder has provided the Company with an unsecured line of credit with interest at 4% per annum. The line of credit is due upon demand. At September 30, 2020 the company has drawn $53,953upon the line of credit.
The Company may become or is subject to investigations, claims, or lawsuits arising in the ordinary course of its business. After consultation with legal counsel, management is not aware of any claims or threatened claims that reasonably would be expected to exceed insurance limits, or otherwise have a material adverse effect upon the Company’s financial position, results of operations, or liquidity.
NOTE 4-RELATED PARTY TRANSACTIONS
During the years ended September 30, 2020, and September 30, 2019 the company incurred expenses of $13,573, and $8,403, respectively, that were paid by a related party. The related party loan payable balance was $53,953, and $44,173 as of September 30, 2020 and 2019, respectively.
NOTE 5 – SUBSEQUENT EVENTS
Management has evaluated subsequent events through January 11, 2020, the date the financial statements were available to be issued. Management is not aware of any significant events that occurred subsequent to the balance sheet date that would have a material effect on the financial statements thereby requiring adjustment or disclosure.
The accompanying notes are an integral part of these consolidated financial statements.
F-5