The accompanying notes are an integral part
of these financial statements.
The accompanying notes are an integral part
of these financial statements.
NOTES TO THE INTERIM FINANCIAL STATEMENTS
For the Six Months ended June 30, 2018
(Unaudited)
NOTE 1 – NATURE OF BUSINESS AND BASIS OF PRESENTATION
Bio-En Holdings Corp (formerly Olivia Inc.)
is a Delaware company (the “Company”), incorporated under the laws of the State of Delaware on August 2, 2011. The
Company had intended to be a world leader of setting the standard for waste to bio-fuel technologies (“Bio-Fuel Plan”).
The Company had a then expectation to plan, design and execute agreements to build, operate and maintain a bio-mass to energy facility
on the Island of Malta (“Facility”). Due to an inability to raise the necessary funds Company disbanded its efforts
to pursue the Bio-Fuel Plan and Facility.
Effective August 21, 2014, the Company
filed with the State of Delaware a Certificate of Amendment to its Articles of Incorporation changing the Company’s name
from Olivia, Inc. to Bio-En Holdings Corp.
As pursuant to a Share
Exchange/Merger Agreement, dated August 21, 2014 (“Merger Agreement”) Bio-En Corp merged with, and into Bio-En
Holdings Corp., with Bio-En Corp being the surviving entity of the merger and changing its name to
Bio-En Holdings Corp. This transaction closed on September 10, 2014 and each issued and outstanding share of common stock of
Bio-En Corp was converted into one share of common stock in Bio-En Holdings Corp.
The completion of the Merger Agreement
resulted in a change of control. The Merger Agreement was accounted for as a reverse merger and recapitalization, with Bio-En Corp.
regarded as the accounting acquirer, since Bio-En Corp. shareholders collectively beneficially owned approximately 89.6% of the
common stock immediately after the closing of the Merger Agreement.
Basis of Presentation
The Company maintains its accounting records
on an accrual basis in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”).
These financial statements are presented in US dollars.
Fiscal Year End
The Corporation has adopted a fiscal year
end of December 31.
Unaudited Interim Financial Statements
The interim financial statements of the
Company as of June 30, 2018, and for the periods then ended are unaudited. However, in the opinion of management, the interim financial
statements include all adjustments, consisting of only normal recurring adjustments, necessary to present fairly the Company’s
financial position as of June 30, 2018, and the results of its operations and its cash flows for the period ended June 30, 2018.
These results are not necessarily indicative of the results expected for the calendar year ending December 31, 2018. The accompanying
financial statements and notes thereto do not reflect all disclosures required under accounting principles generally accepted in
the United States. Refer to the Company’s audited financial statements as of December 31, 2017, filed with the SEC, for additional
information, including significant accounting policies.
Functional and Reporting Currency
The Company's reporting currency is the
U.S. dollar. The Company’s functional currency is US dollars. Items in the income statement and cash flow statement are translated
into U.S. Dollars using the average rates of exchange for the periods involved. The resulting translation adjustments are recorded
as a separate component of other comprehensive income/(loss) within stockholders’ equity.
NOTE 2 – SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES
The principal accounting policies are
set out below, these policies have been consistently applied to the period presented, unless otherwise stated:
Use of Estimates
The preparation of the interim financial
statements in conformity with accounting principles generally accepted in the United States requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities
at the date of the financial statements and the reported amounts or revenues and expenses during the reporting period. Actual results
could differ from those estimates.
Going concern
The accompanying financial statements have
been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the
liquidation of liabilities in the normal course of business. As at June 30, 2018, the Company has a working capital deficit of
$9,200 and a loss from operations of $36,010 and an accumulated deficit of $369,616 and has earned no revenues since inception.
The Company intends to fund operations through equity financing arrangements, which may be insufficient to fund its capital expenditures,
working capital and other cash requirements for the year ending December 31, 2018.
Management
has identified public or private placement offerings to raise additional funds.
This current inability to
generate revenue raises substantial doubt about the Company’s ability to continue as a going concern. The accompanying
financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Risks and Uncertainties
The Company may intend to operate
in an industry that is subject to rapid change. The Company's operations may then be subject to significant risk and
uncertainties including financial, operational, technological, regulatory and other risks, including the potential of
business failure.
Business Segments
The Company had operated in one
segment and therefore segment information is/was not presented.
Cash and cash equivalents
Cash and equivalents include investments
with initial maturities of three months or less. The Company maintains its cash balances at credit-worthy financial institutions
that are insured by the Federal Deposit Insurance Corporation ("FDIC") up to $250,000.
Accounts payable and accrued liabilities
Accounts payable and accrued liabilities
are carried at amortized cost and represent liabilities for goods and services provided to the Company prior to the end of the
financial year that are unpaid and arise when the Company becomes obliged to make future payments in respect of the purchase of
these goods and services.
Share Based Payments
The Company recognizes compensation expense
for all equity–based payments in accordance with ASC 718 “Share-Based Payments". Under fair value recognition
provisions, the Company recognizes Equity–Based compensation net of an estimated forfeiture rate and recognizes compensation
cost only for those shares expected to vest over the requisite service period of the award.
Share-Based Payments to employees, including
grants of employee stock options, are recognized as compensation expense in the financial statements based on their fair values.
That expense is recognized over the period during which an employee is required to provide services in exchange for the award,
known as the requisite service period (usually the vesting period).
The Company accounts for Share–Based
Payments granted to non–employees in accordance with ASC 505, “Equity Based Payments to Non–Employees”.
The Company determines the fair value of the Share–Based Payment as either the fair value of the consideration received or
the fair value of the equity instruments issued, whichever is more reliably measurable. If the fair value of the equity instruments
issued is used, it is measured using the stock price and other measurement assumptions as of the earlier of either (1) the date
at which a commitment for performance by the counterparty to earn the equity instruments is reached, or (2) the date at which the
counterparty’s performance is complete.
Earnings per share
The Company computes net loss per share
in accordance with ASC 260, "Earnings per Share" ASC 260 requires presentation of both basic and diluted
earnings
per share
(“EPS”) on the face of the income statement. Basic EPS is calculated by dividing the profit or loss
attributable to common shareholders of the Company by the weighted average number of common shares outstanding during the period.
Diluted EPS is determined by adjusting the profit or loss attributable to common shareholders and the weighted average number
of common shares outstanding for the effects of all potential dilutive common shares, which comprise options granted to employees.
Common stock equivalents totaling, 30,000
on June 30, 2018 were not included in the computation of diluted earnings per share on the statement of operations due to the fact
that the Company reported a net loss in the first quarter of 2018 and to do so would be anti-dilutive.
Income taxes
The Company accounts for income taxes under
FASB Codification Topic 740-10-25 (“ASC 740-10-25”). Under ASC 740-10-25, 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 bases. Deferred tax assets and liabilities are measured using enacted tax rates expected
to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under ASC
740-10-25, the 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.
Fair Value Measurements
The Company measures assets and liabilities
at fair value based on an expected exit price as defined by the authoritative guidance on fair value measurements, which represents
the amount that would be received on the sale of an asset or paid to transfer a liability, as the case may be, in an orderly transaction
between market participants. As such, fair value may be based on assumptions that market participants would use in pricing an asset
or liability. The authoritative guidance on fair value measurements establishes a consistent framework for measuring fair value
on either a recurring or nonrecurring basis whereby inputs, used in valuation techniques, are assigned a hierarchical level.
The following are the hierarchical levels
of inputs to measure fair value:
- Level 1:
|
Quoted prices in active markets for identical instruments;
|
- Level 2:
|
Other significant observable inputs (including quoted prices in active markets for similar instruments);
|
- Level 3:
|
Significant unobservable inputs (including assumptions in determining the fair value of certain investments).
|
The carrying values for cash and cash equivalents,
accounts receivable, other current assets, accounts payable and accrued liabilities, and deferred revenue approximate their fair
value due to their short maturities.
NOTE 3 – LOAN FROM RELATED PARTY
|
|
June 30,
|
|
|
December 31,
|
|
|
|
2018
|
|
|
2017
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
$
|
|
|
$
|
|
|
|
|
|
|
|
|
|
|
Loan from related party
|
|
|
12,000
|
|
|
|
70,000
|
|
The above loan is unsecured and is repayable on demand.
NOTE 4 – STOCKHOLDERS’ DEFICIT
Merger
On August 21, 2014 the Company
entered into Merger Agreement between Bio-En Holdings Corp f/k/a Olivia, Inc. a Delaware corporation, Serena B. Potash,
the Principal Shareholder, and Bio-En Corp, a Delaware corporation. On August 21, 2014 (the “Closing Date”)
Company filed a Certificate of Merger in the State of Delaware whereby Bio-En Corp. merged with Bio-En Holdings Corp,
with Bio-En Holdings Corp the surviving entity.
In accordance with the Merger
Agreement, Ms. Potash, the then Chief Executive Officer and Director, agreed to
cancel 6,024,625 shares of the Company’s common stock representing 84% of the then
outstanding common stock (all of which shares have been cancelled by the Company and are now included in the Company’s
pool of authorized but unissued shares.).
In conjunction with the Merger
Agreement, all of the issued and outstanding shares of Bio-En Corp as of August 21, 2014 were exchanged for 28,980,000 shares
of Bio-En Holdings Corp. common stock.
Common Stock
For the period from January 6, 2014 to
March 31, 2014, the Company issued 4,409,196 shares of common stock at $0.0001 per share for $441, for professional services.
On March 23, 2014 the Company issued 2,548,853
shares of common stock at $0.0001 per share for $255, as consideration to purchase license rights to develop and use patented intellectual
property as described in note 3.
For the period between January 6, 2014
and March 31, 2014 the Company issued 23,041,951 shares of common stock to related parties at $0.0001 per share for $2,304 to related
parties for services.
On March 12, 2018 the Company completed
the issuance of 45,000,000 shares of Common Stock at $0.00525 per share for $236,250.
The list of shareholders maintained by
the registrars shows a total of 77,350,003 shares of common stock issued and outstanding as at August 1 2018.
Additional Paid-in Capital
During 2014, an officer of the Company
paid operating expenses on behalf of the Company totaling $133,454, which was treated as contributed capital.
Cancellation of Shares
Pursuant to the Merger Agreement, Ms.
Potash, the principal shareholder of Bio-En Holdings Corp., owning an aggregate of 7,894,625 shares of Bio-En Holding Corp.
common stock, agreed to cancel 6,024,601 of her shares. All cancelled shares of common stock were returned to the
Company’s pool of authorized but unissued shares.
NOTE 5 – INCOME TAXES
The (benefit)/ provision for income taxes
for the periods ended June 30, 2018 and December 31, 2017 differ from the amount which would be expected as a result of applying
the statutory tax rates to the losses before income taxes due primarily to changes in the valuation allowance to fully reserve
net deferred tax assets.
Realization of deferred tax assets is dependent
upon sufficient future taxable income during the period that deductible temporary differences and carry-forwards are expected to
be available to reduce taxable income.
|
|
June 30,
|
|
|
December 31,
|
|
|
|
2018
|
|
|
2017
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
$
|
|
|
$
|
|
Deferred tax assets:
|
|
|
|
|
|
|
|
|
Pre-tax loss as reported
|
|
|
(36,010
|
)
|
|
|
(333,606
|
)
|
U.S. statutory tax rate
|
|
|
34
|
%
|
|
|
34
|
%
|
Expected tax expense (benefit)
|
|
|
(12,243
|
)
|
|
|
113,426
|
|
Total deferred tax assets
|
|
|
(12,243
|
)
|
|
|
113,426
|
|
Less: Valuation allowance
|
|
|
12,243
|
|
|
|
(113,426
|
)
|
Net deferred tax assets
|
|
|
-
|
|
|
|
-
|
|
The Company has provided a valuation allowance
against the full amount of the deferred tax asset due to management’s uncertainty about its realization. As of June 30, 2018,
the Company had approximately $369,616 in tax loss carryforwards that can be utilized future periods to reduce taxable income,
and expire by the year 2038.
NOTE 6 – RELATED PARTY TRANSACTIONS
Parties are considered to be related if
one party has the ability to control or exercise significant influence over the other party in making financial and operating decisions.
A related party transaction is considered
to be a transfer of resources or obligations between related parties, regardless of whether or not a price is charged.
Details of transactions between the Company
and related parties are disclosed below:
The following individuals/entities as
of June 30, 2018 have been identified as related parties:
Mr. Baruch Adika
|
- President/Director and greater than 10% shareholder
|
Mr. Shlomi Shany
|
- Director and greater than 10% shareholder
|
Mr. Bruce Minsky
|
- Corporate Secretary
|
|
|
June 30,
|
|
|
December 31,
|
|
|
|
2018
|
|
|
2017
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
$
|
|
|
$
|
|
The following transactions were carried out with related parties:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet:
|
|
|
|
|
|
|
|
|
Loan from related party
|
|
|
12,000
|
|
|
|
70,000
|
|
From time to time, prior to 2018, the former president of the Company provided advances to the Company for its working capital purposes. These advances carried interest accrued to the loan and were due on demand. During 2018 the Directors have made certain payments to suppliers on behalf of the Company. These amounts are repayable on demand.
|
|
|
|
|
|
|
|
|
NOTE 7 – SUBSEQUENT EVENTS
In accordance with ASC 855-10, Company
management reviewed all material events through the date of this report and determined that there are no additional material subsequent
events to report.