CMHZ Banny Cosmic International Holdings Inc (CE)

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

 

FORM 10-Q/A 2

 

[X]	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the quarterly period ended September 30, 2014
[  ]	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from _____ to _____

 

Commission File No. 000-27791

 

Apolo Gold & Energy Inc.

(Exact name of registrant as specified in its Charter)

 

Nevada		98-0412805
(State of Other Jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

 

Suite 2201, 22/F Malaysia Building, 50 Gloucester Road, Wanchai, Hong Kong

(Address of principal executive offices) (Zip Code)

 

(852) 3111 7718

(Registrant’s telephone number including area code)

 

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 (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [X]   No [  ]

 

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 definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

 

Large accelerated filer [  ]	Accelerated filer [  ]	Non-accelerated filer [  ]	Smaller reporting company [X]
		(Do not check if a smaller reporting company)

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [X]   No [  ]

 

As of September 30, 2014, the Registrant had 28,432,118 shares of Common Stock outstanding. This is after giving effect to a share consolidation of 20:1 approved by shareholders on October 29, 2010, and the cancellation issuance of 11,000,000 common shares in the period ending September 30, 2014.

 

Transitional Small Business Disclosure Format (check one): Yes [  ]   No [X]

 

 

 

TABLE OF CONTENTS

 

		Page
Part I. Financial Information
Item 1. Financial Statements		F-1
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations General Overview		3
Item 3. Quantitative and Qualitative Disclosures About Market Risk		4
Item 4. Controls and procedures		5
Part II – Other Information
Item 1. Legal Proceedings		6
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		6
Item 3. Default Upon Senior Securities		6
Item 4. Mine Safety Disclosures		6
Item 5. Other Information		6
Item 6. Exhibits		6
Signatures		7

 

 

Part I. Financial Information

 

Item 1. Financial Statements

 

APOLO GOLD & ENERGY INC.

(An Exploration Stage Company)

CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

		September 30, 2014				June 30, 2014
ASSETS
CURRENT ASSETS
Accounts receivable		$	1,000,000			$	-
Amount due from director			-				15,482
Cash			1,963				7,439
Total Current Assets			1,001,963				22,921
NON-CURRENT ASSETS
Mineral Property Interests (Note 4)			1,200,000				1,200,000
Investments (Note 5)			-				8,950,000
Total Non-Current Assets			1,200,000				10,150,000
TOTAL ASSETS		$	2,201,963			$	10,172,921
LIABILITIES & STOCKHOLDER’ DEFICIT
CURRENT LIABILITIES
Accounts payable & accrued expenses		$	17,965			$	10,079
Amount due to director (Note 8)			23,807				-
Total Current Liabilities			41,772				10,079
COMMITMENTS & CONTINGENCIES			-				-
STOCKHOLDERS’ EQUITY/ (DEFICIT)
Common stock, 300,000,000 shares authorized, $0.001 par value; 28,432,118 shares issued and outstanding (Note 6)			30,316				41,316
Additional paid-in capital			13,099,835				18,038,835
Shares to be cancelled (Note 7)			(3,000,000	)			-
Deferred compensation			(32,333	)			(32,333	)
Comprehensive income			(8,583	)			1,869
Accumulated deficit prior to exploration			(1,862,852	)			(1,862,852	)
Deficit accumulated during exploration stage			(6,066,192	)			(6,023,993	)
TOTAL STOCKHOLDERS’ EQUITY/ (DEFICIT)			2,160,191				10,162,842
TOTAL LIABILITIES & STOCKHOLDERS EQUITY/ (DEFICIT)		$	2,201,963			$	10,172,921

 

The accompanying notes are an integral part of these interim financial statements.

 

 

APOLO GOLD & ENERGY INC.

(An Exploration Stage Company)

STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(Unaudited)

 

		Three Months Ended				Three Months Ended				Period from April 16, 2002 (Inception of Exploration Stage) Through
		September 30, 2014				September 30, 2013				September 30, 2014
REVENUES		$	-			$	-			$	-
EXPENSES
Consulting and professional fees			40,033				6,500				2,129,821
Exploration costs			-				-				2,449,248
Stock compensation expense			-				-				381,340
General and administrative expenses			2,166				5,838				1,072,218
TOTAL EXPENSES			42,199				12,338				6,032,627
LOSS FROM OPERATIONS			(42,199	)			(12,338	)			(6,032,627	)
OTHER INCOME (EXPENSE)
Loss on sale of mining equipment			-				-				(177,193	)
Gain on settlement of debt			-				-				142,442
Other income			-				-				1,186
			-				-				(33,565	)
LOSS BEFORE INCOME TAXES			(42,199	)			(12,338	)			(6,066,192	)
INCOME TAXES			-				-				-
NET LOSS AND COMPREHENSIVE LOSS		$	(42,199	)		$	(12,338	)		$	(6,066,192	)
NET LOSS PER SHARE, BASIC AND DILUTED:		$	(0.00	)		$	(0.00	)
WEIGHTED AVERAGE NUMBER OF COMMON STOCK SHARES OUTSTANDING, BASIC AND DILUTED:			28,432,118				6,605,197

 

The accompanying notes are an integral part of these interim financial statements.

 

 

APOLO GOLD & ENERGY INC.

(An Exploration Stage Company)

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

										Period from
										April 16, 2002
										(Inception of
		Three Months Ended				Three Months Ended				Exploration Stage Through)
		September 30, 2014				September 30, 2013				September 30, 2014
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Loss		$	(42,199	)		$	(12,338	)		$	(6,066,192	)
Adjustments to reconcile net loss to net cash used by operating activities:
Depreciation			-				-				95,176
Loss on sale of mining equipment			-				-				177,193
Options exercised for services			-				-				276,691
Gain on settlements of debt			-				-				(142,442	)
Stock issued for current debt			-				-				470,041
Stock issued for officer’s wages & services			-				-				252,700
Stock issued for professional services			-				-				323,727
Stock issued for exploration costs			-				-				711,000
Stock options granted			-				-				381,340
Expenses paid on behalf of Company			-				-				42,610
(Decrease) increase in:
Accounts receivable			(1,000,000	)			-				(1,000,000	)
Accounts payable and accrued expenses			7,886				(17,965	)			254,640
Accrued payables, related parties			-				-				416,546
Amount due to director			39,289				-				39,289
Net cash (used) by operating activities			(995,024	)			(30,303	)			(3,767,681	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Investment in Jiangxi Everenergy New Material Co, Ltd.			1,000,000				-				-
Purchase of fixed assets			-				-				(95,174	)
			1,000,000				-				(95,174	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from (repayments of) related party loans			-				(86,399	)			214,133
Proceeds from borrowings			-				-				84,937
Proceeds from subscription receivable			-				-				25,000
Proceeds from sale of common stock			-				150,000				3,547,835
Net cash provided by financing activities			-				63,601				3,871,905
Effect of exchange rate changes on cash			(10,452	)			-				(8,583	)
NET INCREASE IN CASH			(5,476	)			33,298				467
Cash, beginning of period			7,439				417				1,496
Cash, end of period		$	1,963			$	33,715			$	1,963
SUPPLEMENTAL CASH FLOWS INFORMATION
Income taxes paid		$	-			$	-			$	-
Interest paid		$	-			$	-			$	-
NON-CASH INVESTING & FINANCING ACTIVITIES:
Note receivable from sale of mining equipment		$	-			$	-			$	45,000
Common stock issued for mineral property interests		$	-			$	-			$	1,200,000
Common stock issued for investments		$	(7,950,000	)		$	-			$	-
Common stock issued on settlement of debt		$	-			$	-			$	660,323

 

The accompanying notes are an integral part of these interim financial statements.

 

 

APOLO GOLD & ENERGY INC.

CONDENSED NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(An Exploration Stage Company)

September 30, 2014

(Unaudited)

 

 

NOTE 1 – BASIS OF PRESENTATION

 

These consolidated financial statements have been prepared in accordance with generally accepted accounting principles for the interim financial information with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of the Company’s management, all adjustments (consisting of only normal, recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three months ended September 30, 2014 are not necessarily indicative of the results that may be expected for the year ending June 30, 2015.

 

For further information, refer to the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended June 30, 2014.

 

The Company’s fiscal year-end is June 30.

 

NOTE 2 – ACCOUNTING POLICIES

 

This summary of significant accounting policies of Apolo Gold & Energy Inc. is presented to assist in understanding the Company’s financial statements. The financial statements and notes are representations of the Company’s management, which is responsible for their integrity and objectivity. These accounting policies conform to accounting principles generally accepted in the United States of America and have been consistently applied in the preparation of the financial statements. There have been no changes in accounting policies from those disclosed in the notes to the audited financial statements June 30, 2014.

 

Consolidation

 

The financial statements include the accounts of Apolo Gold & Energy Asia Limited, a 100% owned subsidiary of the Company.

 

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 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 and Concentration of Risk

 

A fair value hierarchy was established that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements).

 

Level 1: classification is applied to any asset or liability that has a readily available quoted market price from an active market where there is significant transparency in the executed/quoted price.

 

Level 2: classification is applied to assets and liabilities that have evaluated prices where the data inputs to these valuations are observable either directly or indirectly but do not represent quoted market prices from an active market.

 

Level 3: classification is applied to assets and liabilities when prices are not derived from existing market data and requires us to develop our own assumptions about how market participants would price the asset or liability.

 

The fair values of financial instruments, which include cash, accounts payable and accrued liabilities and loans payable to related parties, were estimated to approximate their carrying values due to the immediate or relatively short maturity of these instruments. Management does not believe that the Company is subject to significant interest, currency or credit risks arising from these financial instruments.

 

 

Going Concern

 

As shown in the financial statements, the Company incurred a net loss of $42,199 for the three month period ended September 30, 2014 and has an accumulated deficit of $7,929,044, no revenues, and limited cash resources as at September 30, 2014.

 

These factors indicate that the Company may be unable to continue in existence. The financial statements do not include any adjustments related to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that might be necessary in the event the Company cannot continue existence. The Company’s management is actively seeking additional capital and management believes that new properties can ultimately be developed to enable the Company to continue its operations. However, there are inherent uncertainties in mining operations and management cannot provide assurances that it will be successful in its endeavors. These financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

Accounting Pronouncements

 

Recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the AICPA, and the SEC did not, or are not believed by management to, have a material impact on our present or future financial statements.

 

NOTE 3 – PREFERRED STOCK

 

The Company’s directors authorized 25,000,000 preferred shares with a par value of $0.001. The preferred shares will have rights and preferences set from time to time by the Board of Directors. As of September 30, 2014 and June 30, 2014, the Company has no preferred shares issued and outstanding.

 

NOTE 4 – MINERAL PROPERTY INTERESTS

 

On December 11, 2013, the Company acquired a 70% interest in three gold exploration claims in China’s Xinjiang Province.

 

The Company issued 6-million shares for the following claims:

 

	a)	Gold Mine Reconnaissance in the West of Daqing Gerry River, Qinghe County, comprising of 7.91 sq km, the claims are valid until March 27, 2014. The agreement for such claims expired on March 27, 2014 and the Company is currently renegotiating a renewed agreement.
	b)	Gold Mine Detailed Survey in the Northwest of Sensha Water Mountain, Heshuo, comprising of 15.8 sq km, the claims are valid until July 3, 2015.
	c)	Keler Nebrack Gold Mine Detailed Survey in Habar County, comprising of 10.28 sq km, the claims are valid until February 20, 2015.

 

NOTE 5 – INVESTMENTS

 

On December 23, 2013, the Company acquired a 24% interest in Jiangxi Everenergy New Material Co., Ltd. (“Everenergy”) The consideration was settled with the Company of 8-million restricted common stocks at a deemed price of $0.375 per share, plus $1-million in cash. Additionally, on February 19, 2014, the Company acquired an additional 29% interest in Everenergy. The consideration will be settled with the issue of 11-million restricted common stock at a deemed price of $0.45 per share. As at the date of this report, the ownership for both acquisitions have not been completed. Consequently, the acquisitions are treated as investment and no consolidation of the financial statements were adopted.

 

Everenergy produces and sells high-quality lithium batteries, cathode materials and relevant precursor materials.

 

On September 17, 2014, the Company cancelled all the 11,000,000 common shares and 8,000,000 common shares originally issued for the acquisition of 29% and 24% interest respectively, in Everenergy.

 

The 11-million shares issued were effectively cancelled on October 21, 2014, and the remaining 8-million shares issued are in the process of cancellation and seeking repayment of the $1 million paid for the acquisition. The repayment is included in Account Receivable in the Balance Sheet.

 

 

NOTE 6 – COMMON STOCK

 

At a shareholder meeting held October 29, 2010, shareholders authorized an increase in authorized capital from 200,000,000 to 300,000,000 common shares with a par value of $0.001. In addition, shareholders also authorized a share consolidation of 20:1. These financial statements have been restated retroactively to reflect this share consolidation.

 

There were 1,875,000 shares of common stock issued for a cash consideration of $0.08 per share during the period ending September 30, 2013. The shares were issued to a director of the Company.

 

On December 1, 2013, the Company issued 100,000 common shares to a consultant pursuant to an administrative consulting services agreement dated November 16, 2013.

 

Also on December 1, 2013, the Company issued 200,000 common shares to a consultant pursuant to an additional administrative consulting services agreement dated November 16, 2013.

 

On December 6, 2013, the Company issued 5,000,000 common shares at a price of $0.20 per share for proceeds of $1 million.

 

On December 16, 2013, the Company issued 6,000,000 common shares for three mineral properties.

 

On December 23, 2013, the Company issued 8,000,000 common shares to acquire a 24% interest in Everenergy.

 

On February 11, 2014, the Company issued 100,000 common shares to a senior officer for administrative consulting services agreement dated November 16, 2013.

 

On February 19, 2014, the Company issued 11,000,000 common shares to acquire a 29% in Everenergy.

 

On June 15, 2014, the Company issued 653,823 common shares to a director as repayment of debt.

 

On September 17, 2014, the Company cancelled all the 11,000,000 common shares and 8,000,000 common shares originally issued for the acquisition of 29% and 24% interest respectively, in Everenergy. The 11,000,000 common shares were effectively cancelled on October 21, 2014. The 8,000,000 common shares as at the date of this report, are still in the process of cancellation.

 

At September 30, 2014, there are 28,432,118 common shares issued and outstanding.

 

There were no stock options, warrants or other potentially dilutive securities outstanding as at September 30, 2014 and June 30, 2014.

 

NOTE 7 – SHARES TO BE CANCELLED

 

On December 23, 2013, the Company acquired a 24% interest in Jiangxi Everenergy New Material Co., Ltd. (“Everenergy”) The Company issued 8-million restricted common stocks at a deemed price of $0.375 per share, plus $1-million in cash. However, due to negotiation and sellers’ personal reasons, the acquisition exercise for Everenergy was unsuccessful and consequently the whole acquisition was cancelled.

 

The 8 million shares are in the process of being cancelled along with a demand notice for the return of the $1-million payment.

 

NOTE 8 – RELATED PARTY TRANSACTIONS

 

During the three months period ended September 30, 2014, the Chief Executive Officer, made various expense payments for and on behalf of the Company amounting to US$39,289. Such amount was treated as advance made to the Company.

 

The Company incurred management fees during the period to its Chief Financial Officer amounted to $3,750 during the three months ended September 30, 2014 (three months ended September 30, 2013 - $nil).

 

 

NOTE 9 – COMMITMENTS AND CONTINGENCIES

 

Foreign Operations

 

The accompanying balance sheet at September 30, 2014 includes $6 of overdraft in Canada and $53 in Hong Kong. Although Canada and Hong Kong (China) are considered economically stable, it is always possible that unanticipated events in foreign countries could disrupt the Company’s operations.

 

Compliance with Environmental Regulations

 

The Company’s mining activities are subject to laws and regulations controlling not only the exploration and mining of mineral properties, but also the effect of such activities on the environment. Compliance with such laws and regulations may necessitate additional capital outlays affect the economics of a project, and cause changes or delays in the Company’s activities.

 

Commitments:

 

The Company entered in the following contracts during the period:

 

	●	On the November 1, 2013, Company entered into an agreement with a company controlled by the Chief Financial Officer for management services for a fee of $1,250 per month for a period of one year. The contract allows for additional fees if more than ten hours per month is needed from the Chief Financial Officer.
	●	On September 15, 2013, the Company entered into a consulting services agreement. Under the agreement, the services begin October 1, 2013 and end October 1, 2014. Fees payable under the agreement is HK$80,000 per month (approximately $10,000 per month).
	●	On November 16, 2013, the Company entered into a consulting services agreement, for services to begin December 1, 2013 and end November 30, 2014. Fees payable under the consulting services agreement is $5,000 per month.

 

 

ITEM 2 - Management’s Discussion and Analysis of Financial Condition and Results of Operations General Overview

 

Apolo Gold & Energy Inc. (“Company”) was incorporated in March 1997 under the laws of the State of Nevada. Its objective was to pursue mineral properties in South America, Central America, North America and Asia. The Company incorporated a subsidiary - Compania Minera Apologold, C.A in Venezuela to develop a gold/diamond mining concession in Southeastern Venezuela. Project was terminated in August 2001, due to poor testing results and the property abandoned. This subsidiary company has been inactive since 2001 and will not be reactivated.

 

On April 16, 2002, the Company announced the acquisition of the mining rights to a property known as the Napal Gold Property, (“NUP”). This property is located 48 km south-west of Bandar Lampung, Sumatra, Indonesia. The property consists of 733.9 hectares and possesses a Production Permit (a KP) # KW. 098PP325.

 

The terms of the Napal Gold Property called for a total payment of $375,000 US over a six-year period of which a total of $250,000 had been made. Subsequent to the year ending June 30, 2008 the Company terminated its agreement on the NUP property and returned all exploration rights to the owner.

 

On October 29, 2010, shareholders approved an increase in the authorized capital of the Company to 300,000,000 shares of common stock from 200,000,000. In addition to this, shareholders also authorized a share consolidation of 20:1 effective immediately.

 

On September 12, 2013, the Company incorporated Apolo Gold & Energy Asia Limited.

 

During the period ending March 31, 2014, the Company completed the sale of 1,875,000 common shares to a director of the Company for cash in the amount of $0.08 per share for a total consideration of $150,000. The Company, also, completed the sale of 5,000,000 common shares for cash in the amount of $0.20 per share for proceeds of $1,000,000.

 

On December 11, 2013, the Company acquired a 70% interest in three gold exploration claims in China’s Xinjiang Province. The Company issued 1.2-million shares for the claims.

 

On December 23, 2013, the Company acquired a 24% interest in Jiangxi Everenergy New Material Co., Ltd. (“Everenergy”) The Company issued 8-million restricted common stocks at a deemed price of $0.375 per share, plus $1-million in cash. Additionally, on February 19, 2014, the Company agreed to acquire an additional 29% interest in Everenergy. The consideration is to be settled with the issuance of 11-million restricted common stock at a deemed price of $0.45 per share. However, due to negotiation and sellers’ personal reasons, the acquisition exercise for Everenergy was unsuccessful and consequently the whole acquisition was cancelled.

 

The Company has secured the cancellation of 11 million shares relating to the Everenergy acquisition. A further 8 million shares are in the process of being cancelled along with a demand notice for the return of the $1-million payment.

 

The Company continues to pursue opportunities in the natural resource industry and will consider an investment in any other energy related business in order to create value.

 

At September 30, 2014, the Company had funds on hand of $1,963.

 

 

The Company recognizes that it does not have sufficient funds on hand to finance its operations on an ongoing basis. The Company further recognizes that it is dependent on the ability of its management team to obtain the necessary working capital in order to complete projects started and operate successfully. There is no assurance that the Company will be able to obtain additional capital as required, or if the capital is available, to obtain it on terms favorable to the Company. The Company may suffer from a lack of liquidity in the future that could impair its exploration efforts and adversely affect its results of operations.

 

Results of Operations

 

In the three months ended September 30, 2014, the Company incurred a loss of $42,199 (2013 - $12,338). Consulting and professional fees for the three months ended September 30, 2014 were $40,033 (2013 - $6,500), as business operations increased with a change in management.

 

General and administrative costs were $2,166 in the three month period ended September 30, 2014 (2013 - $5,838) due to increased business activity.

 

The Company recognizes that it will require additional capital in order to continue to develop its mineral properties. There is no assurance at this time that said capital can be raised on terms and conditions acceptable to management.

 

At September 30, 2014 there were 28,432,118 shares outstanding. This includes the issuance of 1,875,000 common shares at $0.08 per share for total proceeds of $150,000; 1,053,823 common shares for services; 5,000,000 common shares issued at $0.20 per share for proceeds of $1,000,000; 6,000,000 common shares for three mineral properties; and 8,000,000 common shares for a 24% interest in Everenergy, a lithium battery manufacturer, during the three month period ended September 30, 2014. The Company at September 30, 2014 had current trade accounts payable of $17,965 compared to $10,079 at June 30, 2014 and $6,957 at September 30, 2013.

 

On September 17, 2014, the Company cancelled all the 11,000,000 common shares and 8,000,000 common shares originally issued for the acquisition of 29% and 24% interest respectively, in Everenergy.

 

The Company has secured the cancellation of 11 million shares issued, an addition of 8 million shares are in the process of being cancelled, as well as, the Company is seeking repayment of the $1 million paid for the acquisition.

  

Cash on hand at September 30, 2014 amounted to $1,963. The Company is aware that additional financing will be required in order to continue its pursuit of a mineral property opportunity or a comparable opportunity in a related field. There is no assurance that additional funding will be successfully completed.

 

The Company has no employees other than officers and uses consultants as and when necessary.

 

LIQUIDITY AND CAPITAL RESOURCES

 

The Company has limited financial resources at September 30, 2014 with funds on hand of $1,963 vs. $7,439 at June 30, 2014 and $33,715 at September 2013.

 

The Company has current accounts payable at September 30, 2014 of $17,965 compared to $10,079 at June 30, 2014 and $6,957 at September 30, 2013.

 

As at September 30, 2014, the Company has current accounts receivable of $1-million as part of the cancellation of the Everenergy acquisition. The Company hopes to recover the funds by December 31, 2014.

 

While the Company continues to seek out additional capital, there is no assurance that they will be successful in completing this necessary financing. The Company recognizes that it is dependent on the ability of its management team to obtain the necessary working capital required.

 

During the three months ended September 30, 2014, the chief executive officer of the Company advanced $39,289 vs. $nil at June 30, 2014 and September 30, 2013 to the Company. The advance is payable upon demand.

 

While in the pursuit of additional working capital, the Company is also very active in reviewing other resource development opportunities and will continue with these endeavors.

 

Inflation has not been a factor during the three months ended September 30, 2014.

 

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

 

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 4. Controls and procedures

 

We carried out an evaluation of the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of September 30, 2014 (the “Evaluation Date”). This evaluation was carried out under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were not effective as of the Evaluation Date as a result of the material weaknesses in internal control over financial reporting discussed below.

 

Disclosure controls and procedures are those controls and procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act are recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

 

Notwithstanding the assessment that our internal control over financial reporting was not effective and that there were material weaknesses as identified in this report, we believe that our financial statements contained in our Quarterly Report on Form 10-Q for the quarter ended September 30, 2014 fairly present our financial condition, results of operations and cash flows in all material respects.

 

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act, for the Company.

 

Internal control over financial reporting includes those policies and procedures that: (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of its management and directors; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.

 

Management recognizes that there are inherent limitations in the effectiveness of any system of internal control, and accordingly, even effective internal control can provide only reasonable assurance with respect to financial statement preparation and may not prevent or detect material misstatements. In addition, effective internal control at a point in time may become ineffective in future periods because of changes in conditions or due to deterioration in the degree of compliance with our established policies and procedures.

 

A material weakness is a significant deficiency, or combination of significant deficiencies, that results in there being a more than remote likelihood that a material misstatement of the annual or interim financial statements will not be prevented or detected.

 

Under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, management conducted an evaluation of the effectiveness of our internal control over financial reporting, as of the Evaluation Date, based on the framework set forth in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on its evaluation under this framework, management concluded that our internal control over financial reporting was not effective as of the Evaluation Date.

 

Management assessed the effectiveness of the Company’s internal control over financial reporting as of Evaluation Date and identified the following material weaknesses:

 

Inadequate Segregation of Duties: We have an inadequate number of personnel to properly implement control procedures.

 

Insufficient Written Policies & Procedures: We have insufficient written policies and procedures for accounting and financial reporting.

 

Inadequate Financial Statement Closing Process: We have an inadequate financial statement closing process.

 

Lack of Audit Committee: The lack of a functioning audit committee and lack of a majority of outside directors on the Company’s Board of Directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures.

 

Management is committed to improving its internal controls and will (1) continue to use third party specialists to address shortfalls in staffing and to assist the Company with accounting and finance responsibilities, (2) increase the frequency of independent reconciliations of significant accounts which will mitigate the lack of segregation of duties until there are sufficient personnel and (3) prepare and implement sufficient written policies and checklists for financial reporting and closing processes and (4) may consider appointing outside directors and audit committee members in the future.

 

Management, including our Chief Executive Officer and the Chief Financial Officer, has discussed the material weakness noted above with our independent registered public accounting firm. Due to the nature of this material weakness, there is a more than remote likelihood that misstatements which could be material to the annual or interim financial statements could occur that would not be prevented or detected.

 

This quarterly report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by the our registered public accounting firm pursuant to temporary rules of the SEC that permit us to provide only management’s report in this quarterly report.

 

Changes in internal control over financial reporting

 

There were no changes in our internal control over financial reporting that occurred during the quarter ended September 30, 2014 that have materially affected, or that are reasonably likely to materially affect, our internal control over financial reporting.

 

Limitations on the effectiveness of controls and procedures

 

Our management, including our Chief Executive Officer and the Chief Financial Officer, do not expect that the our controls and procedures will prevent all potential errors or fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met.

 

 

Part II - Other Information

 

Item 1. Legal Proceedings: There are no proceedings to report.

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds. None

 

Item 3. Default Upon Senior Securities: There are no defaults to report.

 

Item 4. Mine Safety Disclosures: N/A

 

Item 5. Other Information: None

 

Item 6. Exhibits

 

31.1		Sarbanes Oxley Section 302 Certification from C.E.O.
31.2		Sarbanes Oxley Section 302 Certification from C.F.O.
32.1		Sarbanes Oxley Section 906 Certification from C.E.O.
32.2		Sarbanes Oxley Section 906 Certification from C.F.O.
101		Interactive Data Files

 

 

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.

 

APOLO GOLD & ENERGY, INC.

 

Dated: December 31, 2014

 

/s/ Kelvin Chak Wai Man
Kelvin Chak Wai Man, President, Chief Executive Officer and Secretary
/s/ Edward Low
Edward Low, Chief Financial Officer

 

 

 

Exhibit 31.1

 

Certification of Chief Executive Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

 

I, Kelvin Chak, certify that:

 

1. I have reviewed this quarterly report on Form 10-Q/A of Apolo Gold & Energy Inc.;

 

2. Based on my knowledge, this report 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 report;

 

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

Date: December 31, 2014

 

/s/ Kelvin Chak Wai Man
Kelvin Chak Wai Man,
Chief Executive Officer,
President and Director

 

 

 

Exhibit 31.2

 

Certification of Chief Financial Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

 

I, Edward Low, certify that:

 

1. I have reviewed this quarterly report on Form 10-Q/A of Apolo Gold & Energy Inc.;

 

2. Based on my knowledge, this report 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 report;

 

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

Date: December 31, 2014

 

/s/ Edward Low
Edward Low
Chief Financial Officer

 

 

 

Exhibit 32.1

 

Certification of Chief Executive Officer

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

 

In connection with the Quarterly Report of Apolo Gold & Energy Inc. (the “Company”) on Form 10-Q/A for the period ending September 30, 2014 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Kelvin Chak, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

 

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

Date: December 31, 2014

 

/s/ Kelvin Chak Wai Man
Kelvin Chak Wai Man,
Chief Executive Officer,
President and Director

 

 

Exhibit 32.2

 

Certification of Chief Financial Officer

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

 

In connection with the Quarterly Report of Apolo Gold & Energy Inc. (the “Company”) on Form 10-Q/A for the period ending September 30, 2014 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Edward Low, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

 

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

Date: December 31, 2014

 

/s/ Edward Low
Edward Low
Chief Financial Officer