UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

 

FORM 10-Q

 

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
   
  For the quarterly period ended December 31, 2015
   
 [  ] 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

 

Wincash 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 December 31, 2015, the Registrant had 21,872,118 shares of Common Stock outstanding.

 

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

 

 

 

   
 

 

TABLE OF CONTENTS

 

    Page
Part I. Financial Information    
     
Item 1. Condensed Financial Statements (unaudited)   3 - 9
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations General Overview   10
Item 3. Quantitative and Qualitative Disclosures About Market Risk   12
Item 4. Controls and procedures   12
     
Part II - Other Information    
     
Item 1. Legal Proceedings   13
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds   13
Item 3. Default Upon Senior Securities   13
Item 4. Mine Safety Disclosures   13
Item 5. Other Information   13
Item 6. Exhibits   13
     
Signatures   14

 

  2 
 

 

Part I. Financial Information

 

Item 1. Condensed Financial Statements (Unaudited)

 

WINCASH APOLO GOLD & ENERGY, INC.

CONDENSED BALANCE SHEETS

AS OF DECEMBER 31, 2015 AND JUNE 30, 2015

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

 

   December 31, 2015   June 30, 2015 
   (Unaudited)   (Audited) 
ASSETS          
CURRENT ASSETS          
Cash and cash equivalents  $1,386   $14,403 
           
TOTAL ASSETS  $1,386   $14,403 
           
LIABILITIES & STOCKHOLDERS’ DEFICIT          
CURRENT LIABILITIES          
Amount due to a director  $9,375   $- 
Amount due to a former director   10,000    10,000 
Other payables and accrued expenses   7,692    24,691 
           
Total liabilities   27,067    34,691 
           
COMMITMENTS & CONTINGENCIES          
           
STOCKHOLDERS’ DEFICIT          
Preferred stock, $0.001 par value; 25,000,000 shares authorized; None issued and outstanding          
Common stock, $0.001 par value; 300,000,000 shares authorized; 21,872,118 shares issued and outstanding as of December 31, 2015 and June 30, 2015   21,872    21,872 
Additional paid-in capital   15,939,279    15,939,279 
Deferred compensation   (264,667)   (550,000)
Stock payable   16,000    - 
Accumulated other comprehensive income   4,878    4,882 
Accumulated deficit   (15,743,043)   (15,436,321)
TOTAL STOCKHOLDERS’ DEFICIT   (25,681)   (20,288)
TOTAL LIABILITIES & STOCKHOLDERS’ DEFICIT  $1,386   $14,403 

 

See accompanying notes to the condensed financial statements.

 

  3 
 

 

WINCASH APOLO GOLD & ENERGY, INC.

CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

FOR THE THREE AND SIX MONTHS ENDED DECEMBER 31, 2015 AND 2014

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

(Unaudited)

 

   Three Months Ended   Six Months Ended 
   December 31, 2015   December 31, 2014   December 31, 2015   December 31, 2014 
                 
REVENUES  $-   $-   $-   $- 
                     
EXPENSES                    
Consulting & professional fees   288,753    52,998    303,203    93,031 
General & administrative expenses   608    3,730    3,519    5,896 
TOTAL EXPENSES   289,361    56,728    306,722    98,927 
                     
LOSS BEFORE INCOME TAX   (289,361)   (56,728)   (306,722)   (98,927)
                     
Income tax expense   -    -    -    - 
                     
NET LOSS  $(289,361)  $(56,728)  $(306,722)  $(98,927)
                     
Other comprehensive loss:                    
Foreign currency translation loss   (1)   (7,049)   (4)   (17,501)
                     
COMPREHENSIVE LOSS  $(289,362)  $(63,777)  $(306,726)  $(116,428)
                     
NET LOSS PER SHARE, BASIC & DILUTED:  $(0.01)  $(0.00)  $(0.01)  $(0.00)
                     
WEIGHTED AVERAGE NUMBER OF COMMON STOCK OUTSTANDING, BASIC & DILUTED:   21,872,118    28,432,118    21,872,118    28,432,118 

 

See accompanying notes to the condensed financial statements.

 

  4 
 

 

WINCASH APOLO GOLD & ENERGY, INC.

CONDENSED STATEMENTS OF CASH FLOWS

FOR THE SIX MONTHS ENDED DECEMBER 31, 2015 AND 2014

(Currency expressed in United States Dollars (“US$”))

(Unaudited)

 

   Six Months Ended   Six Months Ended 
   December 31, 2015   December 31, 2014 
CASH FLOWS FROM OPERATING ACTIVITIES:           
Net loss  $(306,722)  $(98,927)
Adjustments to reconcile net loss to net cash used in operating activities:          
Non-cash items:          
Stock based compensation   301,333    32,333 
Changes in operating assets and liabilities          
Accounts receivable   -    (1,000,000)
Amount due to a director   9,375    - 
Amount due to a former director   -    62,446 
Other payables and accrued expenses   (16,999)   15,773 
Net cash used in operating activities   (13,013)   (988,375)
           
CASH FLOWS FROM INVESTING ACTIVITIES:          
Investment in Jiangxi Everenergy New Material Co, Ltd.   -    1,000,000 
Net cash provided by investing activities    -    1,000,000 
           
Effect of exchange rate changes on cash and cash equivalents   (4)   (17,501)
           
NET CHANGE IN CASH AND CASH EQUIVALENTS   (13,017)   (5,876)
Cash and cash equivalents, beginning of period   14,403    7,439 
Cash and cash equivalents, end of period  $1,386   $1,563 
           
SUPPLEMENTAL CASH FLOWS INFORMATION           
Income taxes paid  $-   $- 
Interest paid  $-   $- 
           
NON-CASH INVESTING & FINANCING ACTIVITIES:          
Common stock issued for investments  $-   $7,950,000 

 

See accompanying notes to the condensed financial statements.

 

  5 
 

 

WINCASH APOLO GOLD & ENERGY, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED DECEMBER 31, 2015

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

(Unaudited)

 

NOTE 1 – BASIS OF PRESENTATION

 

The accompanying unaudited condensed financial statements have been prepared by management in accordance with both accounting principles generally accepted in the United States (“GAAP”), and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Certain information and notes disclosures normally included in audited financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to those rules and regulations, although the Company believes that the disclosure made are adequate to make the information not misleading.

 

In the opinion of management, the consolidated balance sheet as of June 30, 2015 which has been derived from audited consolidated financial statements and these unaudited condensed financial statements reflect all normal and recurring adjustments considered necessary to state fairly the results for the periods presented. The results for the period ended December 31, 2015 are not necessarily indicative of the results to be expected for the entire fiscal year ending June 30, 2016 or for any future period.

 

These unaudited condensed financial statements and notes thereto should be read in conjunction with the Management’s Discussion and the audited consolidated financial statements and notes thereto included in the Annual Report on Form 10-K for the year ended June 30, 2015.

 

NOTE 2 – ORGANIZATION AND DESCRIPTION OF BUSINESS

 

Wincash Apolo Gold & Energy, Inc. (“the Company”) was incorporated in March of 1997 under the laws of the State of Nevada primarily for the purpose of acquiring and developing mineral properties. The Company conducts operations primarily from its administrative offices in Vancouver, British Columbia, Canada.

 

On June 18, 2015, the Company filed an Amendment to its Articles of Incorporation with the Nevada Secretary of State to change its name from Apolo Gold & Energy, Inc. to Wincash Apolo Gold & Energy, Inc.

 

The Company will continue to anticipate potential mineral property exploration and other energy related investments. As of December 31, 2015, the Company does not hold any mineral property exploration claims.

 

NOTE 3 – GOING CONCERN UNCERTAINTIES

 

These unaudited condensed financial statements have been prepared assuming that the Company will continue as a going concern which contemplates the realization of assets and the discharge of liabilities in the normal course of business for the foreseeable future.

 

As of December 31, 2015, the Company has suffered the accumulated deficits of $15,743,043 from prior years and with working capital deficit of $25,681. The continuation of the Company as a going concern is dependent upon the continuing financial support from its stockholders or external financing. Management believes the existing stockholders will provide the additional cash to meet with the Company’s obligations as they become due. However, there can be no assurance that the Company will be able to obtain sufficient funds to meet its obligations.

 

These factors raise substantial doubt about the Company’s ability to continue as a going concern. These condensed financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result in the Company not being able to continue as a going concern.

 

  6 
 

 

WINCASH APOLO GOLD & ENERGY, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED DECEMBER 31, 2015

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

(Unaudited)

 

NOTE 4 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

The accompanying unaudited condensed financial statements reflect the application of certain significant accounting policies as described in this note and elsewhere in the accompanying unaudited condensed financial statements and notes.

 

Use of estimates

 

Management uses estimates and assumptions in preparing these unaudited condensed financial statements that affect the reported amounts of assets and liabilities in the balance sheet, and the revenue and expenses during the periods reported. Actual results may differ from these estimates.

 

Cash and cash equivalents

 

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

 

Stock-based compensation

 

The Company adopts FASB Accounting Standards Codification Topic 718, Compensation – Stock Compensation (“ASC Topic 718”) using the fair value method. Under ASC Topic 718, the stock-based compensation is measured using the Black-Scholes Option-Pricing model on the date of grant under the modified prospective method. The fair value of stock-based compensation that are expected to vest are recognized using the straight-line method over the requisite service period.

 

Income taxes

 

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

 

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

 

Net loss per share

 

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

 

Comprehensive income (loss)

 

ASC Topic 220, “Comprehensive Income”, establishes standards for reporting and display of comprehensive income (loss), its components and accumulated balances. Comprehensive income (loss) as defined includes all changes in equity during a period from non-owner sources. Accumulated other comprehensive income, as presented in the accompanying statement of stockholders’ equity, consists of changes in unrealized gains and losses on foreign currency translation. This comprehensive income (loss) is not included in the computation of income tax expense or benefit.

 

  7 
 

 

WINCASH APOLO GOLD & ENERGY, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED DECEMBER 31, 2015

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

(Unaudited)

 

Related parties

 

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

 

Fair value of financial instruments

 

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

 

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

 

  Level 1: Observable inputs such as quoted prices in active markets;
   
  Level 2: Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and
   
  Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

 

Recent accounting pronouncements

 

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09 that introduces a new five-step revenue recognition model in which an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This ASU also requires disclosures sufficient to enable users to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers, including qualitative and quantitative disclosures about contracts with customers, significant judgments and changes in judgments, and assets recognized from the costs to obtain or fulfill a contract. This standard is effective for fiscal years beginning after December 15, 2016, including interim periods within that reporting period.

 

In June 2014, the FASB issued ASU No. 2014-12, Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period. This ASU requires that a performance target that affects vesting and could be achieved after the requisite service period be treated as a performance condition. A reporting entity should apply existing guidance in ASC 718, Compensation-Stock Compensation, as it relates to such awards. ASU 2014-12 is effective for us in our first quarter of fiscal 2017 with early adoption permitted using either of two methods: (i) prospective to all awards granted or modified after the effective date; or (ii) retrospective to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter, with the cumulative effect of applying ASU 2014-12 as an adjustment to the opening retained earnings balance as of the beginning of the earliest annual period presented in the financial statements.

 

In August 2014, the FASB issued ASU 2014-15. This ASU requires management to assess an entity’s ability to continue as a going concern by incorporating and expanding upon certain principles that are currently in U.S. auditing standards. Specifically, the ASU (1) provides a definition of the term substantial doubt, (2) requires an evaluation every reporting period including interim periods, (3) provides principles for considering the mitigating effect of management’s plans, (4) requires certain disclosures when substantial doubt is alleviated as a result of consideration of management’s plans, (5) requires an express statement and other disclosures when substantial doubt is not alleviated, and (6) requires an assessment for a period of one year after the date that the financial statements are issued (or available to be issued). This standard is effective for the fiscal years ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted.

 

  8 
 

 

WINCASH APOLO GOLD & ENERGY, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED DECEMBER 31, 2015

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

(Unaudited)

 

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

 

NOTE 5 – AMOUNT DUE TO A DIRECTOR

 

As of December 31, 2015, the director of the Company has advanced $9,375 for the payment of administrative expenses. The amount is unsecured, bear no interest, and is payable upon demand. Imputed interest is considered insignificant.

 

NOTE 6 – COMMON STOCK

 

There were no stock options, warrants or other potentially dilutive securities outstanding as of December 31, 2015.

 

As of December 31, 2015, there were 21,872,118 shares of common stock issued and outstanding.

 

NOTE 7 – STOCK PAYABLE

 

On December 1, 2015, the Board of Directors of the Company approved to issue 200,000 shares of restricted common stock at $0.08 per share for the rendering of consulting services of $16,000 in a service period of twelve months commencing from December 2015. For the six months ended December 31, 2015, the Company amortized $1,333 to the operations using the straight-line method. As of December 31, 2015, no shares were issued and $16,000 for this obligation was recorded as stock payable.

 

NOTE 8 – INCOME TAX

 

The Company is registered in the State of Nevada and is subject to the tax laws of the United States of America. For the six months ended December 31, 2015, the Company incurred an operating loss of $306,722. As of December 31, 2015, the operations in the United States of America incurred $15,743,043 of cumulative net operating losses which can be carried forward to offset future taxable income. The net operating loss carryforwards begin to expire in the year 2017 through 2034, if unutilized. The Company has provided for a full valuation allowance of $5,510,065 against the deferred tax assets on the expected future tax benefits from the net operating loss carryforwards as the management believes it is more likely than not that these assets will not be realized in the future.

 

NOTE 9 – RELATED PARTY TRANSACTIONS

 

During the six months ended December 31, 2015, Mr. Tsap Wai Ping, the director of the Company paid $9,375 for general expenses on behalf for the Company.

 

NOTE 10 – COMMITMENTS AND CONTINGENCIES

 

As of December 31, 2015, the Company has no commitments or contingencies involved.

 

NOTE 11 – SUBSEQUENT EVENTS

 

In accordance with ASC Topic 855, “Subsequent Events”, which establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued, the Company has evaluated all events or transactions that occurred after December 31, 2015 up through the date the Company issued the condensed financial statements. There were no subsequent events that required recognition or disclosure.

 

  9 
 

 

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

 

Apolo Gold & Energy Inc. (the “Company”) was incorporated in March 1997 under the laws of the State of Nevada. The Company’s 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 consisted of 733.9 hectares and possessed 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 have been made to date. Company paid $250,000 over the past 5 years and 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 December 11, 2013, the Company acquired 70% interest in three gold exploration claims located in China’s Xinjiang Province from Yinfu Gold Corp. (“Yinfu”). The Company issued 6,000,000 shares of restricted common stock for the claims at $0.20 per share for the consideration of $1,200,000. On January 19, 2015, the Company and Yinfu reached a mutual agreement to terminate the acquisition at the current market value of $0.10 per share and therefore an investment loss of $600,000 was resulted. On February 3, 2015, all 6,000,000 shares of restricted common stock were returned and effectively cancelled.

 

On December 23, 2013, the Company acquired 24% interest in Jiangxi Everenergy New Material Co., Ltd. (“Everenergy”) for a consideration of $4,000,000. The consideration was settled with the issuance of 8,000,000 shares of restricted common stock at a deemed price of $0.375 per share, plus $1,000,000 in cash.

 

On February 19, 2014, the Company acquired an additional 29% interest in Everenergy for a consideration of $4,950,000. The consideration was settled with the issuance of 11,000,000 shares of restricted common stock at a deemed price of $0.45 per share.

 

On September 17, 2014, the Company cancelled both transactions with Everenergy at the current market value of $0.12 per share and requested the return of $1,000,000 cash payment. The 11,000,000 shares were effectively cancelled on October 21, 2014 and the remaining 8,000,000 shares are to be cancelled as of June 30, 2015. For the year ended June 30, 2015, the Company could not recover the $1,000,000 cash payment and therefore a total investment loss of $6,670,000 was resulted.

 

On February 13, 2015, the Company disposed its 100% equity interest in Apolo Gold Direct Limited (formerly known as Apolo Gold & Energy Asia Limited) to (i) Mr. Kelvin Chak Wai Man, the former Chief Executive Officer (“CEO”) and director of the Company, who acquired 40% equity interest, (ii) Mr. Tsap Wai Ping, the current CEO of the Company, who acquired 50% equity interest, and (iii) China Yi Gao Gold Trader Co., Limited, a company incorporated in Hong Kong, which acquired the remaining 10% equity interest, for a consideration of $100.

 

On June 18, 2015, the Company filed an Amendment to its Articles of Incorporation with the Nevada Secretary of State to change its name from Apolo Gold & Energy, Inc. to Wincash Apolo Gold & Energy, Inc.

 

On December 1, 2015, the Board of Directors of the Company approved to issue 200,000 shares of restricted common stock at $0.08 per share for the rendering of consulting services of $16,000 in a service period of twelve months commencing from December 2015. For the six months ended December 31, 2015, the Company amortized $1,333 to the operations using the straight-line method. As of December 31, 2015, no shares were issued and the $16,000 for this obligation was recorded as stock payable.

 

The Company continues to pursue opportunities in the natural resource industry and will consider the acquisition of any other business opportunity in order to enhance value for our shareholders.

 

Results of Operations

 

REVENUES: The Company had generated no revenues for the three and six months ended December 31, 2015 and 2014.

 

EXPENSES:

 

For the three months ended December 31, 2015, the Company incurred a loss of $289,361 (2014 $56,728), an increase of $232,633 or 410%. The increase is mainly attributed to the stock-based compensation (non-cash) relating to consulting services.

 

  10 
 

 

For the six months ended December 31, 2015, the Company incurred a loss of $306,722 (2014 - $98,927), an increase of $207,795 or 210%. The increase is mainly attributed to the stock-based compensation (non-cash) relating to consulting services provided.

 

The Company continues to carefully control its expenses, and intends to seek additional financing both for potential business opportunities it may develop. There is no assurance that the Company will be successful in its attempts to raise additional capital.

 

The Company has no employees in its head office at the present time other than its Officers and Directors, and engages personnel through consulting agreements where necessary as well as outside attorneys, accountants and technical consultants.

 

Cash and cash equivalents as of December 31, 2015 was $1,386 compared to $14,403 at June 30, 2015 and the Company recognizes it may not have sufficient funds to conduct its affairs. It fully intends to seek financing by way of loans, private placements or a combination of both in the coming months. The Company is dependent on its directors to provide necessary funding when required.

 

LIQUIDITY AND CAPITAL RESOURCES

 

Cash Used in Operating Activities

 

Net cash used in operating activities for the six months ended December 31, 2015 was $13,013 as compared to $988,375 for the comparable six months ended December 31, 2014. The decrease was attributable to the decrease in the accounts receivable of $1,000,000 being written off as bad debt for the six months ended December 31, 2014.

 

Cash Provided By Investing Activities

 

Net cash provided by investing activities for the six months ended December 31, 2015 and 2014 was $Nil and $1,000,000, respectively. The net cash provided by investing activities for the six months ended December 31, 2014 was for the investment in Jiangxi Everenergy New Material Co., Limited.

 

The Company has financed its development to date by way of common stock and with loans from directors/ shareholders of the Company. As of December 31, 2015, the Company had 21,872,118 shares of common stock issued and outstanding, and has raised total capital since inception in excess of $7,500,000.

 

The Company has limited financial resources as of December 31, 2015 with cash and cash equivalents of $1,386 and $1,563 as of December, 2015 and 2014, respectively.

 

As of December 31, 2015, the amount due to a former director, who had resigned from his position on September 23, 2015, was $10,000. The amount was unsecured, interest free, and is payable upon demand.

 

As of December 31, 2015, the amount due to a director was $9,375. The amount was unsecured, interest free, and is payable upon demand. Imputed interest is considered insignificant.

 

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.

 

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.

 

Off-Balance Sheet Arrangements

 

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

 

Contractual Obligations

 

As of December 31, 2015, the Company has no contractual obligations involved.

 

  11 
 

 

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 December 31, 2015 (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 December 31, 2015 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.

 

  12 
 

 

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 December 31, 2015 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. & C.F.O.
     
32.1   Sarbanes Oxley Section 906 Certification from C.E.O. & C.F.O.
     
101   Interactive Data Files

 

  13 
 

 

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.

 

WINCASH APOLO GOLD & ENERGY, INC.

 

Dated: February 1, 2016

 

/s/ Tsap Wai Ping  

TSAP WAI PING

President, Chief Executive Officer, Secretary, Director

  

 

  14 
 

 



 

Exhibit 31.1

 

Certification

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

 

I, Tsap Wai Ping, certify that:

 

1. I have reviewed this quarterly report on Form 10-Q of Wincash 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: February 1, 2016

 

/s/ Tsap Wai Pings  
TSAP WAI PING  
President, Chief Executive Officer, Secretary, Director  

 

   
 

 

Certification

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 of Wincash 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: February 1, 2016

 

/s/ Edward Low  
EDWARD LOW  
Chief Financial Officer  

 

 

 



 

Exhibit 32.1

 

Certification

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

 

In connection with the Quarterly Report of Wincash Apolo Gold & Energy, Inc. (the “Company”) on Form 10-Q for the period ending December 31, 2015 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Tsap Wai Ping, 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: February 1, 2016

 

/s/ Tsap Wai Ping  
TSAP WAI PING  
President, Chief Executive Officer, Secretary, Director  

 

   
 

 

Certification

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

 

In connection with the Quarterly Report of Wincash Apolo Gold & Energy, Inc. (the “Company”) on Form 10-Q for the period ending December 31, 2015 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: February 1, 2016

 

/s/ Edward Low  
EDWARD LOW  
Chief Financial Officer  

 

 

 



v3.3.1.900
Document and Entity Information
 6 Months Ended
Dec. 31, 2015
shares
Document And Entity Information  
Entity Registrant Name Wincash Apolo Gold & Energy, Inc.
Entity Central Index Key 0001040721
Document Type 10-Q
Document Period End Date Dec. 31, 2015
Amendment Flag false
Current Fiscal Year End Date --06-30
Entity Filer Category Smaller Reporting Company
Entity Common Stock, Shares Outstanding 21,872,118
Trading Symbol APLL
Document Fiscal Period Focus Q2
Document Fiscal Year Focus 2016


v3.3.1.900
Condensed Balance Sheets - USD ($)
Dec. 31, 2015
Jun. 30, 2015
CURRENT ASSETS    
Cash and cash equivalents $ 1,386 $ 14,403
TOTAL ASSETS 1,386 $ 14,403
CURRENT LIABILITIES    
Amount due to a director 9,375
Amount due to a former director 10,000 $ 10,000
Other payables and accrued expenses 7,692 24,691
Total liabilities $ 27,067 $ 34,691
STOCKHOLDERS' DEFICIT    
Preferred stock, $0.001 par value; 25,000,000 shares authorized; None issued and outstanding
Common stock, $0.001 par value; 300,000,000 shares authorized; 21,872,118 shares issued and outstanding as of December 31, 2015 and June 30, 2015 $ 21,872 $ 21,872
Additional paid-in capital 15,939,279 15,939,279
Deferred compensation (264,667) $ (550,000)
Stock payable 16,000
Accumulated other comprehensive income 4,878 $ 4,882
Accumulated deficit (15,743,043) (15,436,321)
TOTAL STOCKHOLDERS' DEFICIT (25,681) (20,288)
TOTAL LIABILITIES & STOCKHOLDERS' DEFICIT $ 1,386 $ 14,403


v3.3.1.900
Condensed Balance Sheets (Parenthetical) - $ / shares
Dec. 31, 2015
Jun. 30, 2015
Statement of Financial Position [Abstract]    
Preferred stock, par value $ 0.001 $ 0.001
Preferred stock, shares authorized 25,000,000 25,000,000
Preferred stock, shares issued
Preferred stock, shares outstanding
Common stock, par value $ 0.001 $ 0.001
Common stock, shares authorized 300,000,000 300,000,000
Common stock, shares issued 21,872,118 21,872,118
Common stock, shares outstanding 21,872,118 21,872,118


v3.3.1.900
Condensed Statements of Operations and Comprehensive Income (Unaudited) - USD ($)
 3 Months Ended 6 Months Ended
Dec. 31, 2015
Dec. 31, 2014
Dec. 31, 2015
Dec. 31, 2014
Income Statement [Abstract]        
REVENUES
EXPENSES        
Consulting & professional fees $ 288,753 $ 52,998 $ 303,203 $ 93,031
General & administrative expenses 608 3,730 3,519 5,896
TOTAL EXPENSES 289,361 56,728 306,722 98,927
LOSS BEFORE INCOME TAX $ (289,361) $ (56,728) $ (306,722) $ (98,927)
Income tax expense
NET LOSS $ (289,361) $ (56,728) $ (306,722) $ (98,927)
Other comprehensive loss:        
Foreign currency translation loss (1) (7,049) (4) (17,501)
COMPREHENSIVE LOSS $ (289,362) $ (63,777) $ (306,726) $ (116,428)
NET LOSS PER SHARE, BASIC & DILUTED: $ (0.01) $ (0.00) $ (0.01) $ (0.00)
WEIGHTED AVERAGE NUMBER OF COMMON STOCK OUTSTANDING, BASIC & DILUTED: 21,872,118 28,432,118 21,872,118 28,432,118


v3.3.1.900
Condensed Statements of Cash Flows (Unaudited) - USD ($)
 6 Months Ended
Dec. 31, 2015
Dec. 31, 2014
CASH FLOWS FROM OPERATING ACTIVITIES:    
Net loss $ (306,722) $ (98,927)
Non-cash items:    
Stock based compensation $ 301,333 32,333
Changes in operating assets and liabilities    
Accounts receivable $ (1,000,000)
Amount due to a director $ 9,375
Amount due to a former director $ 62,446
Other payables and accrued expenses $ (16,999) 15,773
Net cash used in operating activities $ (13,013) (988,375)
CASH FLOWS FROM INVESTING ACTIVITIES:    
Investment in Jiangxi Everenergy New Material Co, Ltd. 1,000,000
Net cash provided by investing activities 1,000,000
Effect of exchange rate changes on cash and cash equivalents $ (4) (17,501)
NET CHANGE IN CASH AND CASH EQUIVALENTS (13,017) (5,876)
Cash and cash equivalents, beginning of period 14,403 7,439
Cash and cash equivalents, end of period $ 1,386 $ 1,563
SUPPLEMENTAL CASH FLOWS INFORMATION    
Income taxes paid
Interest paid
NON-CASH INVESTING & FINANCING ACTIVITIES:    
Common stock issued for investments $ 7,950,000


v3.3.1.900
Basis of Presentation
 6 Months Ended
Dec. 31, 2015
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Basis of Presentation

NOTE 1 – BASIS OF PRESENTATION

 

The accompanying unaudited condensed financial statements have been prepared by management in accordance with both accounting principles generally accepted in the United States (“GAAP”), and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Certain information and notes disclosures normally included in audited financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to those rules and regulations, although the Company believes that the disclosure made are adequate to make the information not misleading.

 

In the opinion of management, the consolidated balance sheet as of June 30, 2015 which has been derived from audited consolidated financial statements and these unaudited condensed financial statements reflect all normal and recurring adjustments considered necessary to state fairly the results for the periods presented. The results for the period ended December 31, 2015 are not necessarily indicative of the results to be expected for the entire fiscal year ending June 30, 2016 or for any future period.

 

These unaudited condensed financial statements and notes thereto should be read in conjunction with the Management’s Discussion and the audited consolidated financial statements and notes thereto included in the Annual Report on Form 10-K for the year ended June 30, 2015.


v3.3.1.900
Organization and Description of Business
 6 Months Ended
Dec. 31, 2015
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Organization and Description of Business

NOTE 2 – ORGANIZATION AND DESCRIPTION OF BUSINESS

 

Wincash Apolo Gold & Energy, Inc. (“the Company”) was incorporated in March of 1997 under the laws of the State of Nevada primarily for the purpose of acquiring and developing mineral properties. The Company conducts operations primarily from its administrative offices in Vancouver, British Columbia, Canada.

 

On June 18, 2015, the Company filed an Amendment to its Articles of Incorporation with the Nevada Secretary of State to change its name from Apolo Gold & Energy, Inc. to Wincash Apolo Gold & Energy, Inc.

 

The Company will continue to anticipate potential mineral property exploration and other energy related investments. As of December 31, 2015, the Company does not hold any mineral property exploration claims.


v3.3.1.900
Going Concern Uncertainties
 6 Months Ended
Dec. 31, 2015
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Going Concern Uncertainties

NOTE 3 – GOING CONCERN UNCERTAINTIES

 

These unaudited condensed financial statements have been prepared assuming that the Company will continue as a going concern which contemplates the realization of assets and the discharge of liabilities in the normal course of business for the foreseeable future.

 

As of December 31, 2015, the Company has suffered the accumulated deficits of $15,743,043 from prior years and with working capital deficit of $25,681. The continuation of the Company as a going concern is dependent upon the continuing financial support from its stockholders or external financing. Management believes the existing stockholders will provide the additional cash to meet with the Company’s obligations as they become due. However, there can be no assurance that the Company will be able to obtain sufficient funds to meet its obligations.

 

These factors raise substantial doubt about the Company’s ability to continue as a going concern. These condensed financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result in the Company not being able to continue as a going concern.


v3.3.1.900
Summary of Significant Accounting Policies
 6 Months Ended
Dec. 31, 2015
Accounting Policies [Abstract]  
Summary of Significant Accounting Policies

NOTE 4 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

The accompanying unaudited condensed financial statements reflect the application of certain significant accounting policies as described in this note and elsewhere in the accompanying unaudited condensed financial statements and notes.

 

Use of estimates

 

Management uses estimates and assumptions in preparing these unaudited condensed financial statements that affect the reported amounts of assets and liabilities in the balance sheet, and the revenue and expenses during the periods reported. Actual results may differ from these estimates.

 

Cash and cash equivalents

 

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

 

Stock-based compensation

 

The Company adopts FASB Accounting Standards Codification Topic 718, Compensation – Stock Compensation (“ASC Topic 718”) using the fair value method. Under ASC Topic 718, the stock-based compensation is measured using the Black-Scholes Option-Pricing model on the date of grant under the modified prospective method. The fair value of stock-based compensation that are expected to vest are recognized using the straight-line method over the requisite service period.

 

Income taxes

 

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

 

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

 

Net loss per share

 

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

 

Comprehensive income (loss)

 

ASC Topic 220, “Comprehensive Income”, establishes standards for reporting and display of comprehensive income (loss), its components and accumulated balances. Comprehensive income (loss) as defined includes all changes in equity during a period from non-owner sources. Accumulated other comprehensive income, as presented in the accompanying statement of stockholders’ equity, consists of changes in unrealized gains and losses on foreign currency translation. This comprehensive income (loss) is not included in the computation of income tax expense or benefit.

 

Related parties

 

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

 

Fair value of financial instruments

 

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

 

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

 

  Level 1: Observable inputs such as quoted prices in active markets;
   
  Level 2: Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and
   
  Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

 

Recent accounting pronouncements

 

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09 that introduces a new five-step revenue recognition model in which an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This ASU also requires disclosures sufficient to enable users to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers, including qualitative and quantitative disclosures about contracts with customers, significant judgments and changes in judgments, and assets recognized from the costs to obtain or fulfill a contract. This standard is effective for fiscal years beginning after December 15, 2016, including interim periods within that reporting period.

 

In June 2014, the FASB issued ASU No. 2014-12, Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period. This ASU requires that a performance target that affects vesting and could be achieved after the requisite service period be treated as a performance condition. A reporting entity should apply existing guidance in ASC 718, Compensation-Stock Compensation, as it relates to such awards. ASU 2014-12 is effective for us in our first quarter of fiscal 2017 with early adoption permitted using either of two methods: (i) prospective to all awards granted or modified after the effective date; or (ii) retrospective to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter, with the cumulative effect of applying ASU 2014-12 as an adjustment to the opening retained earnings balance as of the beginning of the earliest annual period presented in the financial statements.

 

In August 2014, the FASB issued ASU 2014-15. This ASU requires management to assess an entity’s ability to continue as a going concern by incorporating and expanding upon certain principles that are currently in U.S. auditing standards. Specifically, the ASU (1) provides a definition of the term substantial doubt, (2) requires an evaluation every reporting period including interim periods, (3) provides principles for considering the mitigating effect of management’s plans, (4) requires certain disclosures when substantial doubt is alleviated as a result of consideration of management’s plans, (5) requires an express statement and other disclosures when substantial doubt is not alleviated, and (6) requires an assessment for a period of one year after the date that the financial statements are issued (or available to be issued). This standard is effective for the fiscal years ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. 

 

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


v3.3.1.900
Amount Due to a Director
 6 Months Ended
Dec. 31, 2015
Amount Due To Director  
Amount Due to a Director

NOTE 5 – AMOUNT DUE TO A DIRECTOR

 

As of December 31, 2015, the director of the Company has advanced $9,375 for the payment of administrative expenses. The amount is unsecured, bear no interest, and is payable upon demand. Imputed interest is considered insignificant.


v3.3.1.900
Common Stock
 6 Months Ended
Dec. 31, 2015
Equity [Abstract]  
Common Stock

NOTE 6 – COMMON STOCK

 

There were no stock options, warrants or other potentially dilutive securities outstanding as of December 31, 2015.

 

As of December 31, 2015, there were 21,872,118 shares of common stock issued and outstanding.


v3.3.1.900
Stock Payable
 6 Months Ended
Dec. 31, 2015
Stock Payable  
Stock Payable

NOTE 7 – STOCK PAYABLE

 

On December 1, 2015, the Board of Directors of the Company approved to issue 200,000 shares of restricted common stock at $0.08 per share for the rendering of consulting services of $16,000 in a service period of twelve months commencing from December 2015. For the six months ended December 31, 2015, the Company amortized $1,333 to the operations using the straight-line method. As of December 31, 2015, no shares were issued and $16,000 for this obligation was recorded as stock payable.


v3.3.1.900
Income Tax
 6 Months Ended
Dec. 31, 2015
Income Tax Disclosure [Abstract]  
Income Tax

NOTE 8 – INCOME TAX

 

The Company is registered in the State of Nevada and is subject to the tax laws of the United States of America. For the six months ended December 31, 2015, the Company incurred an operating loss of $306,722. As of December 31, 2015, the operations in the United States of America incurred $15,743,043 of cumulative net operating losses which can be carried forward to offset future taxable income. The net operating loss carryforwards begin to expire in the year 2017 through 2034, if unutilized. The Company has provided for a full valuation allowance of $5,510,065 against the deferred tax assets on the expected future tax benefits from the net operating loss carryforwards as the management believes it is more likely than not that these assets will not be realized in the future.


v3.3.1.900
Related Party Transactions
 6 Months Ended
Dec. 31, 2015
Related Party Transactions [Abstract]  
Related Party Transactions

NOTE 9 – RELATED PARTY TRANSACTIONS

 

During the six months ended December 31, 2015, Mr. Tsap Wai Ping, the director of the Company paid $9,375 for general expenses on behalf for the Company.


v3.3.1.900
Commitments and Contingencies
 6 Months Ended
Dec. 31, 2015
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies

NOTE 10 – COMMITMENTS AND CONTINGENCIES

 

As of December 31, 2015, the Company has no commitments or contingencies involved.


v3.3.1.900
Subsequent Events
 6 Months Ended
Dec. 31, 2015
Subsequent Events [Abstract]  
Subsequent Events

NOTE 11 – SUBSEQUENT EVENTS

 

In accordance with ASC Topic 855, “Subsequent Events”, which establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued, the Company has evaluated all events or transactions that occurred after December 31, 2015 up through the date the Company issued the condensed financial statements. There were no subsequent events that required recognition or disclosure.


v3.3.1.900
Summary of Significant Accounting Policies (Policies)
 6 Months Ended
Dec. 31, 2015
Accounting Policies [Abstract]  
Use of Estimates

Use of estimates

 

Management uses estimates and assumptions in preparing these unaudited condensed financial statements that affect the reported amounts of assets and liabilities in the balance sheet, and the revenue and expenses during the periods reported. Actual results may differ from these estimates.
Cash and Cash Equivalents

Cash and cash equivalents

 

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

Stock-based compensation

 

The Company adopts FASB Accounting Standards Codification Topic 718, Compensation – Stock Compensation (“ASC Topic 718”) using the fair value method. Under ASC Topic 718, the stock-based compensation is measured using the Black-Scholes Option-Pricing model on the date of grant under the modified prospective method. The fair value of stock-based compensation that are expected to vest are recognized using the straight-line method over the requisite service period.
Income Taxes

Income taxes

 

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

 

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

Net loss per share

 

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

Comprehensive income (loss)

 

ASC Topic 220, “Comprehensive Income”, establishes standards for reporting and display of comprehensive income (loss), its components and accumulated balances. Comprehensive income (loss) as defined includes all changes in equity during a period from non-owner sources. Accumulated other comprehensive income, as presented in the accompanying statement of stockholders’ equity, consists of changes in unrealized gains and losses on foreign currency translation. This comprehensive income (loss) is not included in the computation of income tax expense or benefit.
Related Parties

Related parties

 

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

Fair value of financial instruments

 

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

 

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

 

  Level 1: Observable inputs such as quoted prices in active markets;
   
  Level 2: Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and
   
  Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.
Recent Accounting Pronouncements

Recent accounting pronouncements

 

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09 that introduces a new five-step revenue recognition model in which an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This ASU also requires disclosures sufficient to enable users to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers, including qualitative and quantitative disclosures about contracts with customers, significant judgments and changes in judgments, and assets recognized from the costs to obtain or fulfill a contract. This standard is effective for fiscal years beginning after December 15, 2016, including interim periods within that reporting period.

 

In June 2014, the FASB issued ASU No. 2014-12, Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period. This ASU requires that a performance target that affects vesting and could be achieved after the requisite service period be treated as a performance condition. A reporting entity should apply existing guidance in ASC 718, Compensation-Stock Compensation, as it relates to such awards. ASU 2014-12 is effective for us in our first quarter of fiscal 2017 with early adoption permitted using either of two methods: (i) prospective to all awards granted or modified after the effective date; or (ii) retrospective to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter, with the cumulative effect of applying ASU 2014-12 as an adjustment to the opening retained earnings balance as of the beginning of the earliest annual period presented in the financial statements.

 

In August 2014, the FASB issued ASU 2014-15. This ASU requires management to assess an entity’s ability to continue as a going concern by incorporating and expanding upon certain principles that are currently in U.S. auditing standards. Specifically, the ASU (1) provides a definition of the term substantial doubt, (2) requires an evaluation every reporting period including interim periods, (3) provides principles for considering the mitigating effect of management’s plans, (4) requires certain disclosures when substantial doubt is alleviated as a result of consideration of management’s plans, (5) requires an express statement and other disclosures when substantial doubt is not alleviated, and (6) requires an assessment for a period of one year after the date that the financial statements are issued (or available to be issued). This standard is effective for the fiscal years ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. 

 

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


v3.3.1.900
Going Concern Uncertainties (Details Narrative) - USD ($)
Dec. 31, 2015
Jun. 30, 2015
Organization, Consolidation and Presentation of Financial Statements [Abstract]    
Accumulated deficit $ 15,743,043 $ 15,436,321
Working capital deficit $ 25,681  


v3.3.1.900
Summary of Significant Accounting Policies (Details Narrative)
 6 Months Ended
Dec. 31, 2015
Accounting Policies [Abstract]  
Percentage of tax benefits likelihood of being realized upon settlement of tax authority greater than 50%


v3.3.1.900
Amount Due to a Director (Details Narrative)
 6 Months Ended
Dec. 31, 2015
USD ($)
Amount Due To Director  
Payment of administrative expenses $ 9,375


v3.3.1.900
Common Stock (Details Narrative) - shares
Dec. 31, 2015
Jun. 30, 2015
Equity [Abstract]    
Common stock shares issued 21,872,118 21,872,118
Common stock shares outstanding 21,872,118 21,872,118


v3.3.1.900
Stock Payable (Details Narrative) - USD ($)
 6 Months Ended
Dec. 01, 2015
Dec. 31, 2015
Stock Payable    
Number of restricted common stock shares issued 200,000  
Stock issued price per share $ 0.08  
Number of common stock value issued for services   $ 16,000
Amortized straigt line method value   1,333
Obligation stock payable amount   $ 16,000


v3.3.1.900
Income Tax (Details Narrative)
 6 Months Ended
Dec. 31, 2015
USD ($)
Income Tax Disclosure [Abstract]  
Operating loss $ 306,722
Cumulative net operating losses $ 15,743,043
Net operating loss carryforwards expiration year year 2017 through 2034
Valuation allowance $ 5,510,065


v3.3.1.900
Related Party Transactions (Details Narrative)
Dec. 31, 2015
USD ($)
Mr. Tsap Wai Ping [Member] | General Expense [Member]  
Due to director $ 9,375
Banny Cosmic (CE) (USOTC:CMHZ)
Historical Stock Chart
From Nov 2024 to Dec 2024 Click Here for more Banny Cosmic (CE) Charts.
Banny Cosmic (CE) (USOTC:CMHZ)
Historical Stock Chart
From Dec 2023 to Dec 2024 Click Here for more Banny Cosmic (CE) Charts.