Note
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization
OptiLeaf
Incorporated ("OptiLeaf" or the "Company") was incorporated in Florida in August 2014. The Company has been
in the development stage since inception and has not generated any sales to date. The Company plans to develop, market and sell
integrated software and hardware to the agriculture industry for the seamless tracking and management of growth, task automation
and sale of their clients' products.
Basis
of Presentation
The accompanying unaudited financial
statements have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information.
Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S.
generally accepted accounting principles have been condensed or omitted pursuant to such principles and regulations of the Securities
and Exchange Commission for Form 10-Q. All adjustments, consisting of normal recurring adjustments, have been made which, in the
opinion of management, are necessary for a fair presentation of the results of interim periods. The results of operations for such
interim periods are not necessarily indicative of the results that may be expected for a full year. The unaudited financial statements
contained herein should be read in conjunction with the audited financial statements and notes thereto for the year ended December
31, 2015.
Cash
and Cash Equivalents
The Company considers all highly liquid
investments with an original maturity of three months or less to be cash equivalents. Cash equivalents consisted of money market
funds. At March 31, 2016 and December 31, 2015, the Company had cash equivalents of approximately $442,896 and $504,971, respectively.
Use
of Estimates
The
preparation of financial statements in conformity with accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying
notes. Actual results could differ from those estimates.
Property
and Equipment
Property
and equipment are stated at cost. Depreciation is provided over the estimated useful lives (3 years) of the related assets using
the straight line depreciation method.
Maintenance
and repairs are charged to operations when incurred. Betterments and improvements are capitalized. When property and equipment
are sold or otherwise disposed of, the asset account and related accumulated depreciation account are reduced, and any gain or
loss is included in operations.
Note
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Revenue
Recognition
In
general, the Company will record revenue when persuasive evidence of an arrangement exists, services have been rendered or product
delivery has occurred, the sales price to the customer is fixed or determinable, and collectability is reasonably assured. The
following policies reflect specific criteria for the various revenues streams of the Company:
Revenue
will be recognized at the time the product is delivered or services are performed. Provision for sales returns will be estimated
based on the Company's historical return experience. Revenue will be presented net of returns.
Research
and Development
The
cost of research and development are charged to expense when incurred.
Net
Loss Per Common Share
Basic
net (loss) income per common share is calculated using the weighted average common shares outstanding during each reporting period.
Diluted net (loss) income per common share adjusts the weighted average common shares for the potential dilution that could occur
if common stock equivalents (convertible debt and preferred stock, warrants, stock options and restricted stock shares and units)
were exercised or converted into common stock. There were no common stock equivalents at March 31, 2016 and 2015.
Income
Taxes
Deferred
income taxes are recognized for the tax consequences related to temporary differences between the carrying amount of assets and
liabilities for financial reporting purposes and the amounts used for tax purposes at each year end, based on enacted tax laws
and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. A valuation
allowance is recognized when, based on the weight of all available evidence, it is considered more likely than not that all, or
some portion, of the deferred tax assets will not be realized. Income tax expense is the sum of current income tax plus the change
in deferred tax assets and liabilities.
ASC
740, Income Taxes, requires a company to first determine whether it is more likely than not (which is defined as a likelihood
of more than fifty percent) that a tax position will be sustained based on its technical merits as of the reporting date, assuming
that taxing authorities will examine the position and have full knowledge of all relevant information. A tax position that meets
this more likely than not threshold is then measured and recognized at the largest amount of benefit that is greater than fifty
percent likely to be realized upon effective settlement with a taxing authority.
The Federal and state income tax returns
of the Company for 2015 and 2014 are subject to examination by the internal Revenue Service and state taxing authorities for three
(3) years from the date filed.
Stock-Based
Compensation
The
Company accounts for equity instruments issued to employees in accordance with ASC 718, Compensation - Stock Compensation. ASC
718 requires all share-based compensation payments to be recognized in the financial statements based on the fair value using
an option pricing model. ASC 718 requires forfeitures to be estimated at the time of grant and revised in subsequent periods if
actual forfeitures differ from initial estimates.
Note
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Equity
instruments granted to non-employees are accounted for in accordance with ASC 505, Equity. The final measurement date for the
fair value of equity instruments with performance criteria is the date that each performance commitment for such equity instrument
is satisfied or there is a significant disincentive for non-performance.
Fair
Value of Financial Instruments
Pursuant
to ASC No. 820, "Fair Value Measurement and Disclosures", the Company is required to estimate the fair value of all
financial instruments included on its balance sheet as of December 31, 2015. The Company's financial instruments consist of accounts
payable and accrued expenses. The Company considers the carrying value of such amounts in the financial statements to approximate
their fair value due to the short-term nature of these financial instruments.
Recent
Pronouncements
In
April 2015, the FASB issued ASU 2015-03 – "Simplifying the Presentation of Debt Issuance Costs" which requires
that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the
carrying amount of the related debt liability instead of being presented as an asset, consistent with debt discounts. Debt disclosures
will include the face amount of the debt liability and the effective interest rate. The update is effective for fiscal years beginning
after December 15, 2015, and required retrospective application. Early adoption permitted for financial statements that have not
been previously issued. We do not expect this adoption to have a material impact on our financial statements.
In
February 2016, the FASB issued ASU 2016-02, "Leases (Topic 842)," which requires lessees to recognize most lease liabilities
on their balance sheets but recognize the expenses on their income statements in a manner similar to current practice. The update
states that a lessee would recognize a lease liability for the obligation to make lease payments and a right-to-use asset for
the right to use the underlying asset for the lease term. The update is effective for interim and annual periods beginning after
December 15, 2018, and early adoption is permitted. The Company is currently evaluating the impact of this guidance on its financial
statements.
Other
recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified
Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact
on the Company's present or future financial statements.
Note
2. COMPUTER EQUIPMENT (NET)
Equipment
is recorded at cost and consisted of the following at March 31, 2016:
Computer equipment
|
|
$
|
10,514
|
|
Less: accumulated depreciation
|
|
|
(5,225
|
)
|
|
|
$
|
5,289
|
|
Depreciation
expense was $876 and $128 for the quarters ended March 31, 2016 and 2015, respectively.
Note
3. STOCKHOLDERS' EQUITY
The
Company has authorized 100,000,000 shares of no par value common stock. At March 31, 2016, the number of shares of common stock
issued and outstanding was 20,210,419.
Note
4. COMMITMENTS AND CONTINGENCIES
The Company leases its offices pursuant
to an agreement that terminates in August 2016. The agreement requires the Company to make monthly minimum lease payments of $1,144
plus it’s pro rata share of operating expenses. Rent expense for the quarter ended March 31, 2016 was $3,432.
At
March 31, 2016, future minimum lease payments were $6,864.
Note
5. INCOME TAXES
The
provision for income taxes differs from the amount computed by applying the statutory federal income tax rate to income before
provision for income taxes. The sources and tax effects of the differences are as follows:
Income tax provision at the federal statutory rate
|
|
|
15
|
%
|
Effect of operating losses
|
|
|
(15
|
)%
|
|
|
|
0
|
%
|
At March 31, 2016, the Company has
a net operating loss carry forward of approximately $276,479 for Federal and state purposes. This loss will be available to offset
future taxable income. If not used, this carry forward will begin to expire in 2034. The deferred tax asset relating to the operating
loss carry forward has been fully reserved at March 31, 2016 and December 31, 2015. The principal difference between the operating
loss for income tax purposes and reporting purposes is disallowed meals and entertainment and a temporary difference in depreciation
expense
.
Note
6. GOING CONCERN
The
Company's financial statements are presented on a going concern basis, which contemplates the realization of assets and satisfaction
of liabilities in the normal course of business.
The
Company has experienced a loss from operations during its development stage as a result of its investment necessary to achieve
its operating plan, which is long-range in nature. For the period from August 11, 2014 (inception) to March 31, 2016, the Company
incurred a net loss of approximately $276,479. In addition, the Company has no revenue generating operations.
The
Company currently believes it has sufficient cash to sustain itself for the next 12 months, and management believes that the funds
currently on hand will be sufficient for management to execute its plan of operations and to continue as a going concern.