NOTES TO THE FINANCIAL STATEMENTS
APRIL 30, 2021
NOTE 1 – ORGANIZATION AND DESCRIPTION OF BUSINESS
Black Rock Petroleum Company, (“Black Rock”
or “The Company”) located at 1361 Peltier Drive, Point Roberts WA, 98281, was formed on April 24, 2013 under the laws of the
State of Nevada. We have not commenced our planned operations. The Company’s fiscal year end is April 30.
On March 15, 2021, the Company believed it had completed a transaction
whereby it acquired One Hundred percent (100%) of the ownership interests of Torrance Petroleum LLC, a Wyoming limited liability company,
in exchange for transfer of Sixty Million Four Hundred Twenty-five Thousand (60,425,000) restricted shares of Company common stock, $0.00001
par value, (the “BKRP Common Shares”) owned by Zoltan Nagy, President/CEO of the Company, to the Seller, Affluence Projects
LLC, a Delaware limited liability company. The original agreement provided that, in addition to transfer of the BKRP Common Shares to
Seller, the Company would issue to Seller shares of a new class of preferred stock, i.e., Fifty Million (50,000,000) shares of Series
A Preferred Stock. The amended agreement eliminated the shares of Series A Preferred Stock being issued to the Seller. As a result, no
additional shares of Company stock were issued by the Company pursuant to the transaction, as the BKRP Shares being transferred to the
Seller had been owned by Mr. Nagy and, thus, were already counted in the number of common shares issued and outstanding prior to the closing
of the transaction.
Torrance Petroleum LLC has not fulfilled its obligations to complete
the transaction despite all assurances. Black Rock Petroleum Company therefore unilaterally recinds the agreement as integral conditions
have not been met. The Company agrees to return the mineral rights of the 520 acre oil field in Torrance California back to the seller
in exchange for the return of 60,425,000 shares to Zoltan Nagy President of Black Rock Petroleum Company.
We have not generated any operating revenues to date.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The Company’s financial statements have
been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).
Use of Estimates
The preparation of financial statements in conformity
with generally accepted accounting principles 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
of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Fair value of financial instruments
The Company follows paragraph 825-10-50-10 of
the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and paragraph 820-10-35-37 of
the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments.
Paragraph 820-10-35-37 establishes a framework for measuring fair value in accounting principles generally accepted in the United States
of America (U.S. GAAP), and expands disclosures about fair value measurements. To increase consistency and comparability in fair
value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to
valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority
to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The
three (3) levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below:
Level 1: Quoted market prices available in active markets for identical
assets or liabilities as of the reporting date.
Level 2: Pricing inputs other than quoted prices
in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.
Level 3: Pricing inputs that are generally unobservable inputs and
not corroborated by market data.
The carrying amount of the Company’s financial
assets and liabilities, such as cash and accounts payable approximate their fair value because of the short maturity of those instruments.
The Company’s notes payable approximates the fair value of such instruments based upon management’s best estimate of
interest rates that would be available to the Company for similar financial arrangements at April 30, 2021.
Income Taxes
The Company follow ASC 740-10-30, which requires
recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial
statements or tax returns. Under this method, deferred tax assets and liabilities are based on the differences between the financial statement
and tax bases of assets and liabilities using enacted tax rates in effect for the fiscal year in which the differences are expected to
reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the
assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income
in the fiscal years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and
liabilities of a change in tax rates is recognized in the Statements of Income in the period that includes the enactment date.
On December 22, 2017, the Tax Cuts and Jobs Act
(TCJA) was signed into law by the President of the United States. TCJA is a tax reform act that among other things, reduced corporate
tax rates to 21 percent effective January 1, 2018. FASB ASC 740, Income Taxes, requires deferred tax assets and liabilities to be adjusted
for the effect of a change in tax laws or rates in the year of enactment, which is the year in which the change was signed into law. Accordingly,
the Company adjusted its deferred tax assets and liabilities at December 31,2017, using the new corporate tax rate of 21 percent. See
Note 5.
The Company adopted ASC 740-10-25 (“ASC
740-10-25”) with regard to uncertainty income taxes. ASC 740-10-25 addresses the determination of whether tax benefits claimed
or expected to be claimed on a tax return should be recorded in the financial statements. Under ASC 740-10-25, we may recognize
the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination
by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements
from such a position should be measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate
settlement. ASC 740-10-25 also provides guidance on derecognition, classification, interest and penalties on income taxes, and accounting
in interim periods and requires increased disclosures. We had no material adjustments to our liabilities for unrecognized income
tax benefits according to the provisions of ASC 740-10-25.
Net income (loss) per common share
Net income (loss) per common share is computed
pursuant to section 260-10-45 of the FASB Accounting Standards Codification. Basic net income (loss) per common share is computed
by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period. Diluted net
income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock and
potentially outstanding shares of common stock during the period. The weighted average number of common shares outstanding and potentially
outstanding common shares assumes that the Company incorporated as of the beginning of the first period presented. There were no potentially
dilutive shares for the years ended April 30, 2021 and 2020.
Recently issued accounting pronouncements
In February 2016, the FASB issued ASU 2016-02,
Leases (Topic 842). ASU 2016-02 requires lessees to recognize lease assets and lease liabilities on the balance sheet and
requires expanded disclosures about leasing arrangements. The new standard supersedes the present U.S. GAAP standard on leases and
requires substantially all leases to be reported on the balance sheet as right-of-use assets and lease obligations. ASU 2016-02 is effective
for fiscal years beginning after December 15, 2018 and interim periods in fiscal years beginning after December 15, 2018, with early
adoption permitted. There has been no material impact on our financial statements as a result of adopting this standard.
On June 20, 2018, the Financial Accounting Standards
Board (FASB) issued Accounting Standards Update (ASU) 2018-07, Compensation—Stock Compensation (Topic 718): Improvements
to Nonemployee Share-Based Payment Accounting. ASU 2018-07 is intended to reduce cost and complexity and to improve financial reporting
for share-based payments to nonemployees (for example, service providers, external legal counsel, suppliers, etc.). Under the new standard,
companies will no longer be required to value non-employee awards differently from employee awards. Meaning that companies will value
all equity classified awards at their grant-date under ASC718 and forgo revaluing the award after this date. The Company has chosen to
early adopt this standard. There has been no material impact on our financial statements as a result of adopting this standard.
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.
NOTE 3 – GOING CONCERN
As reflected in the accompanying financial statements,
the Company has an accumulated deficit of $119,852 as at April 30, 2021, has no current operations and has generated no income to date.
These factors raise substantial doubt about its ability to continue as a going concern. The financial statements have been prepared assuming
that the Company will continue as a going concern. These financial statements do not include any adjustments relating to the recoverability
and classification of recorded asset amounts or amounts and classification of liabilities that might be necessary should the Company be
unable to continue as a going concern. The Company is currently seeking an acquisition opportunity with a company in the mining sector.
NOTE 4 - RELATED PARTY TRANSACTIONS
Since the fiscal year ended April 30, 2016, Zoltan
Nagy, CEO and Director, has advanced the Company funds to pay for general operating expenses. As of April 30, 2021 and 2020, $77,432 and
$65,604, respectively, is due to Mr. Nagy. The amount due is unsecured, non-interest bearing and due on demand.
NOTE 5 – LOAN PAYABLE
During the year ended April 30, 2021, Walter Weeks
(Note 6) advanced the Company $32,125 that was used for professional fees. The advance is unsecured, non-interest bearing and due on demand.
NOTE 6 – CONTRIBUTED CAPITAL
During the year ended April 30, 2021, Mr. Weeks
contributed $32,125 to the Company as part of a planned merger agreement (Note 6). The contributed capital was also used to pay for professional
fees.
NOTE 7 – INCOME TAXES
At April 30, 2021, the Company had net operating
loss carry forwards of approximately $23,659 that may be offset against future taxable income. No tax benefit has been reported
in the April 30, 2021 or 2020 financial statements since the potential tax benefit is offset by a valuation allowance of the same amount.
The provision for Federal income tax consists
of the following for the years ended April 30, 2021 and 2020:
| | |
2020 | | |
2019 | |
| Federal income tax benefit attributable to: | |
| | |
| |
| Current operations | |
$ | (5,730 | ) | |
$ | (486 | ) |
| Less: valuation allowance | |
| 5,730 | | |
| 486 | |
| Net provision for Federal income taxes | |
$ | - | | |
$ | - | |
The cumulative tax effect at the expected rate
of 21% (the U.S. federal income tax rate of 21% is being used due to the new tax law recently enacted) of significant items comprising
our net deferred tax amount is as follows as of April 30, 2021 and 2020:
| | |
2020 | | |
2019 | |
| Deferred Tax Assets: | |
| | |
| |
| NOL Carryover | |
$ | 24,900 | | |
$ | 19,200 | |
| Less valuation allowance | |
| (24,900 | ) | |
| (19,200 | ) |
| Net deferred tax assets | |
$ | - | | |
$ | - | |
Due to the change in ownership provisions of the
Tax Reform Act of 1986, net operating loss carry forwards for Federal income tax reporting purposes are subject to annual limitations. Should
a change in ownership occur, net operating loss carry forwards may be limited as to use in future years.
ASC Topic 740 provides guidance on the accounting
for uncertainty in income taxes recognized in a company’s financial statements. Topic 740 requires a company to determine whether
it is more likely than not that a tax position will be sustained upon examination based upon the technical merits of the position. If
the more-likely-than-not threshold is met, a company must measure the tax position to determine the amount to recognize in the financial
statements.
The Company includes interest and penalties arising
from the underpayment of income taxes in the statements of operations in the provision for income taxes. As of April 30, 2020, the Company
had no accrued interest or penalties related to uncertain tax positions.
NOTE 8 – SUBSEQUENT EVENTS
Management has evaluated subsequent
events pursuant to the requirements of ASC Topic 855, from the balance sheet date through the date the financial statement were available
to be issued and has determined that there are no material subsequent events that require disclosure in these financial statements.