Item 7.
|
MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS
|
Disclaimer Regarding Forward-Looking Statements
This Annual Report on Form 10-K contains forward-looking statements within the meaning of the federal securities laws. These include statements about our expectations, beliefs, intentions or strategies for the future, which we indicate by words or phrases such as “anticipate,” “expect,” “intend,” “plan,” “will,” “we believe,” “believes,” “management believes” and similar language. Except for the historical information contained herein, the matters discussed in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and elsewhere in this report are forward-looking statements that involve risks and uncertainties. The factors listed in the section captioned “Risk Factors,” as well as any cautionary language in this report; provide examples of risks, uncertainties and events that may cause our actual results to differ materially from those projected. Except as may be required by law, we undertake no obligation to update any forward-looking statement to reflect events after the date of this Form 10-K.
Critical Accounting Policies and Estimates
The SEC has defined a company’s critical accounting policies as the ones that are most important to the portrayal of the Company’s financial condition and results of operations and which require the Company to make its most difficult and subjective judgments, often as a result of the need to make estimates of matters that are inherently uncertain. Based on this definition, we have identified the critical accounting policies and judgments addressed below. We also have other key accounting policies that are significant to understanding our results. For additional information, see Note 3 - Summary of Significant Accounting Policies on page 26.
The following are deemed to be the most significant accounting policies affecting the Company.
Principles of Consolidation
The consolidated financial statements include the accounts of the Company and its subsidiary. All significant inter-company balances and transactions are eliminated on consolidation.
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting periods. Measurement, estimates and assumptions are used for, but not limited to, useful lives and residual value of long-lived assets, and the valuation of equity instruments. Management makes these estimates using the best information available at the time the estimates are made; however actual results when ultimately realized could differ from those estimates. The current economic environment has increased the degree of uncertainty inherent in these estimates and assumption.
Revenue Recognition and Accounts Receivable
We will recognize revenues in accordance with the guidelines of the Securities and Exchange Commission (“SEC”) Staff Accounting Bulletin (“SAB”) No. 104 “Revenue Recognition”.
Under SAB 104, four conditions must be met before revenue can be recognized: (i) there is persuasive evidence that an arrangement exists, (ii) delivery has occurred or service has been rendered, (iii) the price is fixed or determinable, and (iv) collection is reasonably assured. The Company provides for an allowance for doubtful account based history and experience considering economic and industry trends. The Company does not have any off-Balance Sheet exposure related to its customers.
Income Taxes
We account for income taxes under the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) No. 740, Income Taxes (“ASC 740”). Under ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under ASC 740, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.
Stock Compensation
In accordance with ASC No. 718,
Compensation – Stock Compensation
(“ASC 718”), we measure the compensation costs of share-based compensation arrangements based on the grant-date fair value and recognize the costs in the financial statements over the period during which employees are required to provide services. Share-based compensation arrangements include stock options, restricted share plans, performance-based awards, share appreciation rights and employee share purchase plans. As such, compensation cost is measured on the date of grant at their fair value. Such compensation amounts, if any, are amortized over the respective vesting periods of the option grant. We apply this statement prospectively. Equity instruments (“instruments”) issued to other than employees are recorded on the basis of the fair value of the instruments, as required by ASC 718. ASC No. 505,
Equity Based Payments to Non-Employees
(“ASC 505”)
defines the measurement date and recognition period for such instruments. In general, the measurement date is (a) when a performance commitment, as defined, is reached or (b) when the earlier of (i) the non-employee performance is complete or (ii) the instruments are vested. The measured value related to the instruments is recognized over a period based on the facts and circumstances of each particular grant as defined in the ASC 505.
Accounting for Derivative Financial Instruments
We evaluate financial instruments using the guidance provided by ASC 815 and apply the provisions thereof to the accounting of items identified as derivative financial instruments not indexed to our stock.
Fair Value of Financial Instruments
We follow the provisions of ASC 820. This Topic defines fair value, establishes a measurement framework and expands disclosures about fair value measurements.
We use fair value measurements for determining the valuation of derivative financial instruments payable in shares of its common stock. This primarily involves option pricing models that incorporate certain assumptions and projections to determine fair value. These require management’s judgment.
Recent Accounting Pronouncements
We have evaluated new accounting pronouncements that have been issued and are not yet effective for us and determined that there are no such pronouncements expected to have an impact on our future financial statements.
Plan of Operations
We have not yet enjoyed any revenues. The Company incurred a net loss of $114,883 for the year ended April 30, 2013 compared to a net loss of $147,131 for the year ended April 30, 2012. These factors create substantial doubt about the Company's ability to continue as a going concern. The Company's management plan to continue as a going concern revolves around its ability to execute its business strategy of distributing digital content, as well as raising the necessary capital to pay ongoing general and administrative expenses of the Company.
In the year ending April 30, 2012, a note payable in the amount of $38,000 was advanced by a related party; in addition $103,000 raised from the sale of stock was advanced from business prospects for future business projects with the Company. The note carries three percent interest and is due on October 27, 2013. The note has been repaid as of June 30, 2012.
Results of Operations
Fiscal Year Ended April 30, 2013 Compared to Fiscal Year Ended April 30, 2012
Revenue
For the fiscal year ended April 30, 2013 and April 30, 2012, we have not generated any revenues.
Operating expenses
Operating expenses decreased by $31,908, or 21.9%, to $113,873 in the year ended April 30, 2013 from $145,781 in the year ended April 30, 2012 primarily due to a decrease in professional fees.
Operating expenses for the year ended April 30, 2013 were comprised primarily of $29,474 in consulting services costs; travel costs of $29,895, equipment rental costs of $15,480, stock based compensation expense of $11,000, office rent of $14,210, professional fees of $10,955, and $2,859 of other operating expenses.
Operating expenses for the year ended April 30, 2012 were comprised primarily of $43,718 in professional fees; $26,100 in consulting services costs, stock based compensation expense of $36,000; travel costs of $11,388; rent of $14,767, advertising costs of $5,650, website setup costs of $6,500, and $1,658 of other operating expenses.
Net loss before income taxes
Net loss before income taxes for the year ended April 30, 2013 totaled $114,063 primarily due to consulting services costs, travel costs, equipment rental costs, stock based compensation expenses, office rent, and professional fees compared to $146,351 for the year ended April 30, 2012 primarily due to professional fees, consulting services costs, stock based compensation expense, office rent, travel costs, advertising costs, and website setup costs.
Assets and Liabilities
Total assets were $42,046 as of April 30, 2013 compared to $22,299 as of April 30, 2012 primarily the result of an increase in prepaid assets of $12,768, investment of documentary of $4,535, and cash of $2,444. Total liabilities as of April 30, 2013 were $54,710 compared to $66,430 as of April 30, 2012, or a decrease of $11,720 or 17.6%. The decrease was primarily the result of decreases in accounts payable to a related party in the amount of $24,944 and long term note payable to a related party of $7,250, offset primarily by accounts payable of $21,044.
Stockholders’ Deficit
Stockholders’ deficit was $(12,664) as of April 30, 2013. Stockholder’s deficit consisted primarily of shares issued for services rendered in the amount of $57,750, shares issued for fundraising totaling $191,600, offset primarily by the deficit accumulated during the development stage of $262,014 at April 30, 2013.
Liquidity and Capital Resources
General
– Overall, we had an increase in cash flows of $2,444 in the year ending April 30, 2013 resulting from cash provided by financing activities of $81,350, offset partially by cash used in operating activities of $74,371 and cash used in investing activities of $4,535.
The following is a summary of our cash flows provided by (used in) operating, investing, and financing activities during the periods indicated:
|
|
Year Ended April 30,
|
|
|
|
2013
|
|
|
2012
|
|
|
|
|
|
|
|
|
Cash at beginning of period
|
|
$
|
483
|
|
|
$
|
2
|
|
Net cash used in operating activities
|
|
|
(74,371
|
)
|
|
|
(107,333
|
)
|
Net cash used in investing activities
|
|
|
(4,535
|
)
|
|
|
(2,550
|
)
|
Net cash provided by financing activities
|
|
|
81,350
|
|
|
|
110,251
|
|
Cash at end of period
|
|
$
|
2,927
|
|
|
$
|
483
|
|
Net cash used in operating activities was $74,371 for the year ending April 30, 2013 compared to net cash used in operations for the year ending April 30, 2012 of $107,333 primarily due to a net loss of $114,883 for the year ending April 30, 2013, issuance of common stock to related party for services rendered of $57,750, and the change in operating assets and liabilities of $17,238. Net cash provided by financing activities was $81,350 for the year ending April 30, 2013, compared to net cash provided by financing activities of $110,251 for the year ending April 30, 2012. Net cash used in investing activities was $4,535 for the year ending April 30, 2013, compared to net cash used in investing activities of $2,550 for the year ending April 30, 2012.
During the year ended April 30, 2013, we entered into a private placement memorandum with each of two affiliates under which we issued them 1,772,000 shares of our common stock, restricted in accordance with Rule 144, in exchange for $88,600. The issuance was exempt from registration pursuant to Section 4(2) of the Securities Act of 1933, and the investor was sophisticated and familiar with our operations at the time of the issuance of the shares.
Our cash needs in the year ending April 30, 2014 are estimated to be $200,000. This budget is based on the assumption that we will carry out one project at a time for which we will need about $50,000 in working capital; general and administrative expenses of $150,000 for the costs related to being public, and miscellaneous office expenses. We sold 2,115,334 shares for net proceeds of $191,600 in offerings conducted in fiscal years 2013 and 2012. Additionally, we raised $38,000 through a related party note in fiscal year 2012. As we move forward with our business plan we will need to raise additional capital either through the sale of stock or funding from shares and or officers and directors to cover our cash needs through the end of the 2014 fiscal year.
Information included in this report includes forward looking statements, which can be identified by the use of forward-looking terminology such as may, expect, anticipate, believe, estimate, or continue, or the negative thereof or other variations thereon or comparable terminology. The statements in "Risk Factors" and other statements and disclaimers in this report constitute cautionary statements identifying important factors, including risks and uncertainties, relating to the forward-looking statements that could cause actual results to differ materially from those reflected in the forward-looking statements.
Development Stage Company
Since we have not yet generated any revenues until after April 30, 2013, we were a development stage company as that term is defined in Section 915 - Development Stage Entities, of the FASB Accounting Standards Codification. Our activities have mostly been devoted to seeking capital; seeking supply contracts and development of a business plan. Our auditors have included an explanatory paragraph in their report on our financial statements, relating to the uncertainty of our business as a going concern, due to our lack of operating history or current revenues, its nature as a start up business, management's limited experience and limited funds. We do not believe that conventional financing, such as bank loans, is available to us due to these factors. We have no bank line of credit available to us. Management believes that it will be able to raise the required funds for operations from one or more future offerings, in order to affect our business plan.
Our future operating results are subject to many factors including:
●
|
our success in obtaining contracts for our services;
|
|
|
●
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the success of any joint marketing agreements;
|
|
|
●
|
our ability to obtain additional financing; and
|
|
|
●
|
other risks which we identify in future filings with the SEC.
|
Any or all of our forward looking statements in this filing and in any other public statements we make may turn out to be wrong. They can be affected by inaccurate assumptions we might make or by known or unknown risks and uncertainties. Consequently, no forward looking statement can be guaranteed. In addition, we undertake no responsibility to update any forward-looking statement to reflect events or circumstances which occur after the date of this prospectus.
Equity Financing
During the year ended April 30, 2013, we entered into separate private placement memorandums with two affiliates under which we issued them 1,772,000 shares of our common stock, restricted in accordance with Rule 144, in exchange for $88,600. The issuance was exempt from registration pursuant to Section 4(2) of the Securities Act of 1933, and the investors were sophisticated and familiar with our operations at the time of the issuance of the shares.
During the year ended April 30, 2012, we entered into a stock purchase agreement with an affiliate, under which we issued him a total of 243,334 shares of our common stock, restricted in accordance with Rule 144, in exchange for $73,000. These shares were issued on May 1, 2012. The issuance was exempt from registration pursuant to Section 4(2) of the Securities Act of 1933, and the investor was a sophisticated investor at the time of the issuance of the shares.
On November 16, 2011, we entered into a stock purchase agreement with a non-affiliated third party, under which we issued him 100,000 shares of our common stock, restricted in accordance with Rule 144, in exchange for $30,000. These shares were issued on May 1, 2012. The issuance was exempt from registration pursuant to Section 4(2) of the Securities Act of 1933, and the investor was sophisticated and familiar with our operations at the time of the issuance of the shares.
On May 1, 2012 we issued 250,000 restricted common shares to a non-affiliated third party pursuant to a consulting agreement to assist us in the distribution of certain films. In addition, we issued 5,266,667 restricted common shares to John Ballard, our Chief Financial Officer pursuant to his consulting contract dated October 27, 2011 and amended May 1, 2012. We also issued 633,333 restricted common shares for professional services per consulting contracts dated October 27, 2011 and amended May 1, 2012.
We issued 6,000,000 restricted common shares to Lamont Roberts, our President and Chief Executive Officer, pursuant to his employment contract dated May 1, 2012. Further, we issued 10,000,000 restricted common shares to Kaila Criscione, our Chief Operating Officer pursuant to her employment contract dated May 1, 2012.
Distribution Rights
On February 13, 2012 the company announced that it has acquired the distribution rights to the following motion pictures:
Seducing Spirits, The Perfect Argument, Marina Murders, Film Struggle, Divorce in America, A Wonderful Summer, The Truth About Layla, Living with Cancer and The Biggest Fan
. Under the distribution agreements, Goliath will receive 30% of the gross revenues for each picture it distributes. In general, the Company's distribution contracts cover both domestic and international licensing agreements; however, for the picture
The Biggest Fan,
the Company obtained limited distribution rights.
On July 29, 2012, the Company acquired a 30% exclusive interest for three years of a documentary on the career of, former National Basketball Association star, A.C. Green.
The Company paid $7,085 to acquire this interest, of which a deposit of $2,550 was paid as of April 30, 2012 and the remaining $4,535 has been paid as of July 29, 2012.
Amendment to Articles of Incorporation
On February 26, 2013, the Company filed a Certificate of Amendment to its Restated Certificate of Incorporation with the Secretary of State of the State of Nevada to increase the number of authorized common shares from 149 million to 300 million.
On February 26, 2013, through resolutions adopted by unanimous written consent of the board of directors, the Company approved the increase of authorized common shares from 149 million to 300 million common shares.
Contractual Obligations and Off-Balance Sheet Arrangements
We do not have any contractual obligations or off balance sheet arrangements.
Commitments and Contingencies
We did not record any legal contingencies as of April 30, 2013.
Off-Balance Sheet Arrangements
We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on its financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.
Inflation
Management believes that inflation has not had a material effect on the Company’s results of operations.
Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Our financial statements include the following:
GOLIATH FILM AND MEDIA HOLDINGS
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED APRIL 30, 2013 AND 2012
|
PAGE
|
Reports of Independent Registered Public Accounting Firms
|
17
|
|
|
Consolidated Balance Sheets
|
19
|
|
|
Consolidated Statements of Income
|
20
|
|
|
Consolidated Statements of Changes in Shareholders’ Deficit
|
21
|
|
|
Consolidated Statements of Cash Flows
|
22
|
|
|
Notes to the Consolidated Financial Statements
|
23
|
Report of Independent Registered Public Accounting Firm
To the Board of Directors
Goliath Film and Media Holdings
We have audited the accompanying consolidated balance sheets of Goliath Film and Media Holdings as of April 30, 2013 and the related consolidated statement of income, consolidated statement of stockholders’ deficit and consolidated cash flows for the year then ended. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audit. The consolidated financial statements of Goliath Film and Media Holdings as of April 30, 2012 were audited by other auditors whose report dated August 9, 2012, expressed an unqualified opinion on those statements.
We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provide a reasonable basis for our opinion.
In our opinion the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Goliath Film and Media Holdings as of April 30, 2013 and the results of their operations and cash flows for the year then ended, in conformity with U.S. generally accepted accounting principles.
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 3 to the financial statements, the Company had accumulated losses of $262,014 as of April 30, 2013 which raises substantial doubt about its ability to continue as a going concern. Management’s plans concerning these matters are also described in Note 3. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.
[Missing Graphic Reference]
/s/ Sadler, Gibb & Associates, LLC
Salt Lake City, UT
August 12, 2013
Report of Independent Registered Public Accounting Firm
To the Board of Directors of
Goliath Film and Media Holdings
(A Development Stage Company)
Los Angles, California
We have audited the accompanying consolidated balance sheets of Goliath Film and Media Holdings, as of April 30, 2013 and April 30, 2012, and the related consolidated statements of operations, stockholders' equity (deficit), and cash flows for the period for the years then ended and from the inception on May 1, 2008 to April 30, 2013. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company (A Development Stage Company) as of April 30, 2013 and April 30, 2012, and the results of their operations and their cash flows for the years then ended in conformity with U.S. generally accepted accounting principles.
We were not engaged to examine management's assessment of the effectiveness of the Company’s internal control over financial reporting as of April 30, 2013 and April 30, 2012, and accordingly, we do not express an opinion thereon.
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 3 to the consolidated financial statements, the Company has suffered recurring losses and has experienced negative cash flows from operations, which raises substantial doubt about the Company's ability to continue as a going concern. Management's plans in regard to those matters are also described in Note 3 to the consolidated financial statements. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/s/
Sam Kan & Company
Sam Kan & Company
August 9, 2013
Alameda, California
GOLIATH FILM AND MEDIA HOLDINGS
(A Development Stage Enterprise)
CONSOLIDATED BALANCE SHEETS
|
|
APRIL 30,
|
|
|
|
2013
|
|
|
2012
|
|
ASSETS
|
|
|
|
|
|
|
Current assets
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
2,927
|
|
|
$
|
483
|
|
Prepaid assets
|
|
|
32,034
|
|
|
|
19,266
|
|
Total current assets
|
|
|
34,961
|
|
|
|
19,749
|
|
|
|
|
|
|
|
|
|
|
Long-term assets
|
|
|
|
|
|
|
|
|
Intangible asset, net
|
|
|
7,085
|
|
|
|
2,550
|
|
Total long-term assets
|
|
|
7,085
|
|
|
|
2,250
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
$
|
42,046
|
|
|
$
|
22,299
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
|
|
|
|
Accounts payable
|
|
$
|
43,654
|
|
|
$
|
22,610
|
|
Accounts payable - related party
|
|
|
11,056
|
|
|
|
36,000
|
|
Accrued interest - related party
|
|
|
--
|
|
|
|
570
|
|
Total current liabilities
|
|
|
54,710
|
|
|
|
59,180
|
|
|
|
|
|
|
|
|
|
|
Long term note payable - related party
|
|
|
--
|
|
|
|
7,250
|
|
Total long term liabilities
|
|
|
--
|
|
|
|
7,250
|
|
|
|
|
|
|
|
|
|
|
Total liabilities
|
|
|
54,710
|
|
|
|
66,430
|
|
|
|
|
|
|
|
|
|
|
Stockholders' Deficit
|
|
|
|
|
|
|
|
|
Preferred stock, $0.001 par value, 1,000,000
|
|
|
|
|
|
|
|
|
shares authorized; no shares issued and outstanding
|
|
|
|
|
|
|
|
|
at April 30, 2013 and 2012
|
|
|
--
|
|
|
|
--
|
|
|
|
|
|
|
|
|
|
|
Common stock, $0.001 par value, 300,000,000 shares
|
|
|
|
|
|
|
|
|
authorized; 91,265,334 and 67,343,334 shares
|
|
|
|
|
|
|
|
|
issued and outstanding, at April 30, 2013 and 2012
|
|
|
91,265
|
|
|
|
67,343
|
|
Additional paid in capital
|
|
|
158,085
|
|
|
|
35,657
|
|
Deficit accumulated during the development stage
|
|
|
(262,014
|
)
|
|
|
(147,131
|
)
|
Total stockholders' deficit
|
|
|
(12,664
|
)
|
|
|
(44,131
|
)
|
|
|
|
|
|
|
|
|
|
Total liabilities and stockholders’ deficit
|
|
$
|
42,046
|
|
|
$
|
22,299
|
|
See accompanying notes to consolidated financial statements.
GOLIATH FILM AND MEDIA HOLDINGS
(A Development Stage Enterprise)
CONSOLIDATED STATEMENTS OF INCOME
|
|
|
|
|
|
|
|
For the Period
|
|
|
|
|
|
|
|
|
|
May 1, 2008
|
|
|
|
For the Year Ended
|
|
|
(inception) to
|
|
|
|
April 30, 2013
|
|
|
April 30, 2012
|
|
|
April 30, 2013
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
--
|
|
|
$
|
--
|
|
|
$
|
--
|
|
Cost of goods sold
|
|
|
--
|
|
|
|
--
|
|
|
|
1,125
|
|
Gross profit
|
|
|
--
|
|
|
|
--
|
|
|
|
(1,125
|
)
|
Operating Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales and marketing
|
|
|
--
|
|
|
|
7,550
|
|
|
|
72,499
|
|
General and administrative
|
|
|
113,873
|
|
|
|
138,231
|
|
|
|
376,118
|
|
Total operating expenses
|
|
|
113,873
|
|
|
|
145,781
|
|
|
|
448,617
|
|
Loss from operations
|
|
|
(113,873
|
)
|
|
|
(145,781
|
)
|
|
|
(449,742
|
)
|
Other income (expense)
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense
|
|
|
(190
|
)
|
|
|
(570
|
)
|
|
|
(10,037
|
)
|
Total other income/ (expense)
|
|
|
(190
|
)
|
|
|
(570
|
)
|
|
|
(10,037
|
)
|
Loss before income taxes
|
|
|
(114,063
|
)
|
|
|
(146,351
|
)
|
|
|
(459,779
|
)
|
Provision for income taxes
|
|
|
(820
|
)
|
|
|
(780
|
)
|
|
|
(8,550
|
)
|
Elimination of accumulated deficit due to
|
|
|
|
|
|
|
|
|
|
|
|
|
reverse acquisition
|
|
|
--
|
|
|
|
--
|
|
|
|
206,315
|
|
Net loss
|
|
$
|
(114,883
|
)
|
|
$
|
(147,131
|
)
|
|
$
|
(262,014
|
)
|
Net loss per share of common stock:
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted
|
|
$
|
(0.00
|
)
|
|
$
|
(0.00
|
)
|
|
|
|
|
Weighted average shares
|
|
|
|
|
|
|
|
|
|
|
|
|
Outstanding-Basic and
|
|
|
|
|
|
|
|
|
|
|
|
|
diluted
|
|
|
90,273,192
|
|
|
|
57,066,658
|
|
|
|
|
|
See accompanying notes to consolidated financial statements.
GOLIATH FILM AND MEDIA HOLDINGS
(A Development Stage Enterprise)
CONSOLIDATED STATEMENT OF STOCKHOLDERS’ DEFICIT
|
|
Common Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
Stock Shares
|
|
|
Common
Stock
Amount
|
|
|
Additional
Paid in
Capital
|
|
|
Accumulated
Deficit
|
|
|
Total
Capital
|
|
Balances, May 1, 2008 (Inception)
|
|
|
--
|
|
|
$
|
--
|
|
|
$
|
--
|
|
|
$
|
--
|
|
|
$
|
--
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock issued
|
|
|
4,800,000
|
|
|
|
4,800
|
|
|
|
(4,428
|
)
|
|
|
--
|
|
|
|
372
|
|
Reverse merger with the shell company
|
|
|
419,816
|
|
|
|
420
|
|
|
|
(420
|
)
|
|
|
--
|
|
|
|
--
|
|
Issuance of shares – merger and acquisition
|
|
|
47,000,000
|
|
|
|
47,000
|
|
|
|
(47,000
|
)
|
|
|
--
|
|
|
|
--
|
|
Net loss, period ended April 30, 2009
|
|
|
--
|
|
|
|
--
|
|
|
|
--
|
|
|
|
(50,804
|
)
|
|
|
(50,804
|
)
|
Balances, April 30, 2009
|
|
|
52,219,816
|
|
|
|
52,220
|
|
|
|
(51,848
|
)
|
|
|
(50,804
|
)
|
|
|
(50,432
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss, year ended April 30, 2010
|
|
|
--
|
|
|
|
--
|
|
|
|
--
|
|
|
|
(20,988
|
)
|
|
|
(20,988
|
)
|
Balances, April 30, 2010
|
|
|
52,219,816
|
|
|
|
52,220
|
|
|
|
(51,848
|
)
|
|
|
(71,792
|
)
|
|
|
(71,420
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of shares - services
|
|
|
20,000,000
|
|
|
|
20,000
|
|
|
|
5,000
|
|
|
|
--
|
|
|
|
25,000
|
|
Issuance of shares - private placement
|
|
|
10,400,000
|
|
|
|
10,400
|
|
|
|
2,600
|
|
|
|
--
|
|
|
|
13,000
|
|
Elimination of China Advance retained earnings
|
|
|
--
|
|
|
|
--
|
|
|
|
(206,315
|
)
|
|
|
206,315
|
|
|
|
--
|
|
Net loss, year ended April 30, 2011
|
|
|
--
|
|
|
|
--
|
|
|
|
--
|
|
|
|
(134,523
|
)
|
|
|
(134,523
|
)
|
Balances, April 30, 2011
|
|
|
82,619,816
|
|
|
|
82,620
|
|
|
|
(250,563
|
)
|
|
|
--
|
|
|
|
(167,943
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of shares – private placement
|
|
|
343,334
|
|
|
|
343
|
|
|
|
102,657
|
|
|
|
--
|
|
|
|
103,000
|
|
Cancellation of stock in connection with reverse
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
merger
|
|
|
(15,619,816
|
)
|
|
|
(15,620
|
)
|
|
|
183,563
|
|
|
|
--
|
|
|
|
167,943
|
|
Net loss, year ended April 30, 2012
|
|
|
--
|
|
|
|
--
|
|
|
|
--
|
|
|
|
(147,131
|
)
|
|
|
(147,131
|
)
|
Balances, April 30, 2012
|
|
|
67,343,334
|
|
|
|
67,343
|
|
|
|
35,657
|
|
|
|
(147,131
|
)
|
|
|
(44,131
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of shares - services
|
|
|
22,150,000
|
|
|
|
22,150
|
|
|
|
35,600
|
|
|
|
--
|
|
|
|
57,750
|
|
Issuance of shares – private placement
|
|
|
1,772,000
|
|
|
|
1,772
|
|
|
|
86,828
|
|
|
|
--
|
|
|
|
88,600
|
|
Net loss, year ended April 30, 2013
|
|
|
--
|
|
|
|
--
|
|
|
|
--
|
|
|
|
(114,883
|
)
|
|
|
(114,883
|
)
|
Balances, April 30, 2013
|
|
|
91,265,334
|
|
|
$
|
91,265
|
|
|
$
|
158,085
|
|
|
$
|
(262,014
|
)
|
|
$
|
(12,664
|
)
|
See accompanying notes to consolidated financial statements.
GOLIATH FILM AND MEDIA HOLDINGS
(A Development Stage Enterprise)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(audited)
|
|
|
|
|
|
|
|
For the Period
|
|
|
|
|
|
|
|
|
|
May 1, 2008
|
|
|
|
For the Year Ended
|
|
|
(inception) to
|
|
|
|
April 30, 2013
|
|
|
April 30, 2012
|
|
|
April 30, 2013
|
|
Net Income (loss)
|
|
$
|
(114,883
|
)
|
|
$
|
(147,131
|
)
|
|
$
|
(458,329
|
)
|
Adjustments to reconcile net loss to
|
|
|
|
|
|
|
|
|
|
|
|
|
net cash used in operating expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation
|
|
|
--
|
|
|
|
--
|
|
|
|
23,336
|
|
Issuance of common stock for service rendered
|
|
|
57,750
|
|
|
|
--
|
|
|
|
82,750
|
|
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Increase in prepaid assets
|
|
|
(12,768
|
)
|
|
|
(19,266
|
)
|
|
|
(32,034
|
)
|
Increase (decrease) in accounts payable
|
|
|
21,044
|
|
|
|
22,494
|
|
|
|
55,436
|
|
Increase (decrease) in accounts payable – related party
|
|
|
(24,944
|
)
|
|
|
36,000
|
|
|
|
11,056
|
|
Increase (decrease) in accrued interest – related party
|
|
|
(570
|
)
|
|
|
570
|
|
|
|
--
|
|
Net cash used in operating activities
|
|
|
(74,371
|
)
|
|
|
(107,333
|
)
|
|
|
(317,785
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment in intangible assets
|
|
|
(4,535
|
)
|
|
|
(2,550
|
)
|
|
|
(7,085
|
)
|
Purchase of office furniture and equipment
|
|
|
--
|
|
|
|
--
|
|
|
|
(28,624
|
)
|
Net cash used in investing activities
|
|
|
(4,535
|
)
|
|
|
(2,550
|
)
|
|
|
(35,709
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from issuance of common stock
|
|
|
88,600
|
|
|
|
103,001
|
|
|
|
204,972
|
|
Increase (decrease) in loan from shareholder
|
|
|
(7,250
|
)
|
|
|
7,250
|
|
|
|
--
|
|
Net cash provided by financing activities
|
|
|
81,350
|
|
|
|
110,251
|
|
|
|
204,972
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-cash China Advance acquisition
|
|
|
--
|
|
|
|
(167,831
|
)
|
|
|
151,449
|
|
Retirement of common stock
|
|
|
--
|
|
|
|
167,944
|
|
|
|
--
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net change in cash and cash equivalent
|
|
|
2,444
|
|
|
|
481
|
|
|
|
2,927
|
|
Cash and cash equivalent at beginning of period
|
|
|
483
|
|
|
|
2
|
|
|
|
--
|
|
Cash and cash equivalent at end of period
|
|
$
|
2,927
|
|
|
$
|
483
|
|
|
$
|
2,927
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental Disclosure of non-cash investing and
|
|
|
|
|
|
|
|
|
|
|
|
|
financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of common stock to related party for
|
|
|
|
|
|
|
|
|
|
|
|
|
services rendered
|
|
$
|
57,750
|
|
|
$
|
--
|
|
|
$
|
57,750
|
|
Repay prior officer’s loan
|
|
$
|
--
|
|
|
$
|
9,920
|
|
|
$
|
9,920
|
|
Supplemental Disclosure of cash flow Information:
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash paid for interest
|
|
$
|
760
|
|
|
$
|
--
|
|
|
$
|
760
|
|
Cash paid for taxes
|
|
$
|
--
|
|
|
$
|
--
|
|
|
$
|
--
|
|
See accompanying notes to consolidated financial statements
GOLIATH FILM AND MEDIA HOLDINGS
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDING APRIL 30, 2013 AND 2012
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
On October 31, 2011 (the “Closing Date”), China Advanced Technology acquired Goliath Film and Media International, a California corporation, by issuing 47,000,000 shares of its Common Stock, constituting 70.1% of the outstanding shares after giving effect to their issuance and the cancellation of 15,619,816 shares held by China Advanced Technology’s prior control person. Immediately following the Closing, 67,100,000 shares were issued and outstanding, including the 100,000 shares sold as described in Note 9. On the Closing Date, the name of China Advanced Technology was changed to Goliath Film and Media Holdings (“Goliath” or “the Company”). All share numbers herein have been adjusted for an eight-for-1 forward stock split affected as of the Closing Date. The forward stock split was reflected in the trading market on February 13, 2012. The transaction was accounted for as a reverse acquisition in which Goliath Film and Media International is deemed to be the accounting acquirer, and the prior operations of Goliath (formerly China Advanced Technology are consolidated for accounting purposes. Since Goliath had no operations, assets, or liabilities as of the Closing, no audit of that entity was required under the materiality thresholds of Regulation S-X Rule 8-04.
Organization, Nature of Business and Trade Name
The Company is engaged in the distribution of films and pictures. The Company has not realized revenues from its planned principal business purpose and is considered to be in its development state in accordance with Accounting Standards Codification (“ASC”) 915, “Development Stage Entities.”
Principles of Consolidation
The accompanying consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany accounts and transactions have been eliminated.
Basis of Presentation
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 at the date of the financial statements and the reported amounts of revenue and expenses during the reported period. Actual results could differ from those estimates. Management further acknowledges that it is solely responsible for adopting sound accounting practices, establishing and maintaining a system of internal accounting control and preventing and detecting fraud. The Company's system of internal accounting control is designed to assure, among other items, that (1) recorded transactions are valid; (2) all valid transactions are recorded and (3) transactions are recorded in the period in a timely manner to produce financial statements which present fairly the financial condition, results of operations and cash flows of the company for the respective periods being presented.
Use of Estimates
The preparation of financial statements in 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. A change in managements' estimates or assumptions could have a material impact on the Company's financial condition and results of operations during the period in which such changes occurred.
Actual results could differ from those estimates. The Company's financial statements reflect all adjustments that management believes are necessary for the fair presentation of their financial condition and results of operations for the periods presented.
Cash and Cash Equivalents
For purposes of the statement of cash flows, the Company considers all highly liquid debt instruments purchased with a maturity of three months or less to be cash equivalents.
GOLIATH FILM AND MEDIA HOLDINGS
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDING APRIL 30, 2013 AND 2012
Accounts Receivable
Accounts receivable, if any are carried at the expected net realizable value. The allowance for doubtful accounts, when determined, will be based on management's assessment of the collectability of specific customer accounts and the aging of the accounts receivables. If there were a deterioration of a major customer's creditworthiness, or actual defaults were higher than historical experience, our estimates of the recoverability of the amounts due to us could be overstated, which could have a negative impact on operations.
The Company has been in the development stage since inception and has no operation to date. The Company currently does not have any accounts receivable. The above accounting policies will be adopted upon the Company carrying accounts receivable.
Property, Plant and Equipment
Property and equipment are carried at cost. Expenditures for maintenance and repairs are charged against operations. Renewals and betterments that materially extend the life of the assets are capitalized. When assets are retired or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts, and any resulting gain or loss is reflected in income for the period.
Depreciation is computed for financial statement purposes on a straight-line basis over estimated useful lives of the related assets. The estimated useful lives of depreciable assets are:
|
Estimated
|
|
Useful Lives
|
Office Equipment
|
5-10 years
|
Copier
|
5-7 years
|
Vehicles
|
5-10 years
|
Website / Software
|
3-5 years
|
For federal income tax purposes, depreciation is computed under the modified accelerated cost recovery system. For financial statements purposes, depreciation is computed under the straight-line method. Although the Company has previously purchased property, plant, and equipment, no balances existed during the 2 years presented, due to either prior year’s write-offs for obsolescence or sale.
Intangible Assets
The Company’s intangible assets consist of intellectual property, principally documentary films. The Company periodically reviews its long lived assets to ensure that their carrying value does not exceed their fair market value.
Revenue Recognition
Goliath Film and Media International, intends to develop and license for distribution quality film content. Revenue is recognized when the company receives a contract for the license of its content and its content is delivered to the customer.
The Company has been in the development stage since inception and has no operations to date. The Company currently does not have a means for generating revenue. Revenue and cost recognition procedures will be implemented based on the type of properties required and sale contract specifications.
Advertising
Advertising expenses are recorded as general and administrative expenses when they are incurred. There was no advertising expense for the years ended April 30, 2013 and 2012.
GOLIATH FILM AND MEDIA HOLDINGS
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDING APRIL 30, 2013 AND 2012
Research and Development
All research and development costs are expensed as incurred. There was no research and development expense for the years ended April 30, 2013 and 2012.
Income tax
We are subject to income taxes in the U.S. Significant judgment is required in evaluating our uncertain tax positions and determining our provision for income taxes. In accordance with FASB ASC Topic 740,
“Income Taxes,”
we provide for the recognition of deferred tax assets if realization of such assets is more likely than not.
Non-Cash Equity Transactions
Shares of equity instruments issued for non-cash consideration are recorded at the fair value of the consideration received based on the market value of services to be rendered, or at the value of the stock given, considered in reference to contemporaneous cash sale of stock.
Fair Value Measurements
Effective beginning second quarter 2010, the FASB ASC Topic 825,
Financial Instruments
, requires
disclosures about fair value of financial instruments in quarterly reports as well as in annual reports. For the Company, this statement applies to certain investments and long-term debt. Also, the FASB ASC Topic 820,
Fair Value Measurements and Disclosures
, clarifies the definition of fair value for financial reporting, establishes a framework for measuring fair value and requires additional disclosures about the use of fair value measurements.
Various inputs are considered when determining the value of the Company’s investments and long-term debt. The inputs or methodologies used for valuing securities are not necessarily an indication of the risk associated with investing in these securities. These inputs are summarized in the three broad levels listed below.
Level 1 –
|
observable market inputs that are unadjusted quoted prices for identical assets or liabilities in active markets.
|
|
|
Level 2 –
|
other significant observable inputs (including quoted prices for similar securities, interest rates, credit risk, etc.).
|
|
|
Level 3 –
|
significant unobservable inputs (including the Company’s own assumptions in determining the fair value of investments).
|
The Company’s adoption of FASB ASC Topic 825 did not have a material impact on the Company’s consolidated financial statements.
The carrying value of financial assets and liabilities recorded at fair value is measured on a recurring or nonrecurring basis. Financial assets and liabilities measured on a non-recurring basis are those that are adjusted to fair value when a significant event occurs. The Company had no financial assets or liabilities carried and measured on a nonrecurring basis during the reporting periods. Financial assets and liabilities measured on a recurring basis are those that are adjusted to fair value each time a financial statement is prepared. The Company had no financial assets and/or liabilities carried at fair value on a recurring basis at April 30, 2013.
The availability of inputs observable in the market varies from instrument to instrument and depends on a variety of factors including the type of instrument, whether the instrument is actively traded, and other characteristics particular to the transaction. For many financial instruments, pricing inputs are readily observable in the market, the valuation methodology used is widely accepted by market participants, and the valuation does not require significant management discretion. For other financial instruments, pricing inputs are less observable in the market and may require management judgment. As of April 30, 2013, the Company had no assets other than prepaid expenses, cash, and long-lived assets.
GOLIATH FILM AND MEDIA HOLDINGS
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDING APRIL 30, 2013 AND 2012
Basic and diluted earnings per share
Basic earnings per share are based on the weighted-average number of shares of common stock outstanding. Diluted Earnings per share is based on the weighted-average number of shares of common stock outstanding adjusted for the effects of common stock that may be issued as a result of the following types of potentially dilutive instruments:
●
|
Employee stock options, and
|
●
|
Other equity awards, which include long-term incentive awards.
|
The FASB ASC Topic 260,
Earnings Per Share
, requires the Company to include additional shares in the computation of earnings per share, assuming dilution.
Diluted earnings per share is based on the assumption that all dilutive options were converted or exercised. Dilution is computed by applying the treasury stock method. Under this method, options are assumed to be exercised at the time of issuance, and as if funds obtained thereby were used to purchase common stock at the average market price during the period.
Basic and diluted earnings per share are the same as there were no potentially dilutive instruments for the years ended April 30, 2013 and 2012.
Concentrations, Risks, and Uncertainties
The Company did not have a concentration of business with suppliers or customers constituting greater than 10% of the Company’s gross sales during 2013 and 2012.
Stock Based Compensation
For purposes of determining the variables used in the calculation of stock compensation expense under the provisions of FASB ASC Topic 505, “
Equity
” and FASB ASC Topic 718, “
Compensation — Stock Compensation,”
we perform an analysis of current market data and historical company data to calculate an estimate of implied volatility, the expected term of the option and the expected forfeiture rate. With the exception of the expected forfeiture rate, which is not an input, we use these estimates as variables in the Black-Scholes option pricing model. Depending upon the number of stock options granted, any fluctuations in these calculations could have a material effect on the results presented in our Consolidated Statement of Income. In addition, any differences between estimated forfeitures and actual forfeitures could also have a material impact on our financial statements.
NOTE 2 - RECENTLY ENACTED ACCOUNTING STANDARDS
The Company has evaluated new accounting pronouncements that have been issued and are not yet effective for the Company and determined that there are no such pronouncements expected to have an impact on the Company’s future financial statements.
NOTE 3 - GOING CONCERN
The Company's financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. However, the Company does not have significant cash or other current assets, nor does it have an established source of revenues sufficient to cover its operating costs, which raises substantial doubt about our ability to continue as a going concern.
Under the going concern assumption, an entity is ordinarily viewed as continuing in business for the foreseeable future with neither the intention nor the necessity of liquidation, ceasing trading, or seeking protection from creditors pursuant to laws or regulations. Accordingly, assets and liabilities are recorded on the basis that the entity will be able to realize its assets and discharge its liabilities in the normal course of business.
GOLIATH FILM AND MEDIA HOLDINGS
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDING APRIL 30, 2013 AND 2012
Management expects to seek potential business opportunities for merger or acquisition of existing companies. Currently the Company has yet to locate any merger or acquisition candidates. Management is not currently limiting their search for merger or acquisition candidates to any industry or locations. Management, while not especially experienced in matters relating to public company management, will rely upon their own efforts and, to a much lesser extent, the efforts of the Company's shareholders, in accomplishing the business purposes of the Company.
The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plan described in the preceding paragraph and eventually attain profitable operations. The accompanying financial statements do not include any adjustments that may be necessary if the Company is unable to continue as a going concern.
During the next year, the Company's foreseeable cash requirements will relate to continual development of the operations of its business, maintaining its good standing and making the requisite filings with the Securities and Exchange Commission, and the payment of expenses associated with reviewing or investigating any potential business ventures. The Company may experience a cash shortfall and be required to raise additional capital.
Historically, the Company has relied upon internally generated funds and funds from the sale of shares of stock to finance its operations and growth. Management may raise additional capital through future public or private offerings of the Company's stock or through loans from private investors, although there can be no assurance that it will be able to obtain such financing. The Company's failure to do so could have a material and adverse effect upon its and its shareholders.
In the past year, the Company funded operations by using cash proceeds received through the issuance of common stock. For the coming year, the Company plans to continue to fund the Company through debt and securities sales and issuances, focus on a possible joint venture or merger until the company generates revenues through the operations of such merged company or joint venture as stated above.
NOTE 4 – INTANGIBLE ASSET
Investment in Documentary
On July 29, 2012, the Company acquired a 30% exclusive interest for three years of a documentary on the career of former National Basketball Association star, A.C. Green.
The Company paid $7,085 to acquire this interest, of which a deposit of $2,550 was paid as of April 30, 2012 and the remaining $4,535 has been paid as of July 29, 2012.
NOTE 5 – NOTES PAYABLE
In the year ending April 30, 2012, a note payable in the amount of $11,500 was advanced by a related party, bearing no interest and was repaid as of October 31, 2011.
In the year ending April 30, 2012, a note payable in the amount of $38,000 was advanced by a related party, with an outstanding balance of $0 and $7,250 as of April 30, 2013 and 2012, respectively. This is an unsecured loan bearing 3% and is due on October 27, 2013. This note has been repaid in full as of the date of this filing.
The interest expense for the years ending April 30, 2013 and 2012 is $190 and $570, respectively.
NOTE 6 - RELATED PARTY TRANSACTIONS
During the year ended April 30, 2013, the Company sold 1,772,000 restricted common shares to two affiliate shareholders pursuant to a private placement memorandum in exchange for $88,600.
During the year ended April 30, 2012, the Company sold 243,334 restricted common shares to an affiliate shareholder pursuant to a private placement memorandum in exchange for $73,000.
GOLIATH FILM AND MEDIA HOLDINGS
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDING APRIL 30, 2013 AND 2012
During the year ended April 30, 2013, the Company determined that it would be in the best interests of the Company to increase the amount of shares to the consultant who performs accounting services for the Company, an additional 133,333 restricted common shares and to the Chief Financial Officer, an additional 266,667 restricted common shares valued at historical price of the company on May 1, 2012, which is $0.09 per share.
The Company has consulting agreements with its Chief Financial Officer and another individual who performs accounting services for the Company, under which they are compensated with restricted shares of the company’s common stock. The Chief Financial Officer received a total of 5 million shares with a consulting contract expiring May 1, 2014. In addition, the individual providing accounting services received 500,000 restricted common shares with a contract expiring on May 1, 2014.
The Company issued 6,000,000 restricted common shares to our President and Chief Executive Officer, pursuant to his employment contract dated May 1, 2012. Further, the Company issued 10,000,000 restricted common shares to our Chief Operating Officer pursuant to her employment contract dated May 1, 2012.
On November 4, 2011, we entered into an agreement with the father of the Company’s Chief Operating Officer to write and produce a motion picture.
In accordance with the agreement, the Company paid $10,000 for the script that is recorded as a short term asset on the balance sheet as a part of prepaid assets.
Related party transactions have been disclosed in the other notes to these financial statements.
NOTE 7 - SUPPLEMENTAL CASH FLOW INFORMATION
No amounts were paid for income taxes during the period from May 1, 2008 (date of inception) to April 30, 2013.
NOTE 8 – INCOME TAXES
As of April 30, 2013, the Company had net operating loss carryforwards of approximately $262,014, which expire in varying amounts between 2017 and 2027. Realization of this potential future tax benefit is dependent on generating sufficient taxable income prior to expiration of the loss carryforward. The deferred tax asset related to this (and other) potential future tax benefits has been offset by a valuation allowance in the same amount. The amount of the deferred tax asset ultimately realizable could be increased in the near term if estimates of future taxable income during the carryforwards period are revised.
Deferred income tax assets of $109,784 at April 30, 2013, was offset in full by a valuation allowance.
The components of the Company's net deferred tax assets, including a valuation allowance, are as follows:
Deferred Tax Assets
|
As of April 30, 2013
|
As of April 30, 2012
|
|
|
|
|
|
Net operating loss
|
|
|
|
|
carryforwards
|
$262,014
|
|
$147,131
|
|
|
|
|
|
|
Net deferred tax assets
|
|
|
|
|
before valuation allowance
|
109,784
|
|
61,648
|
|
Less: Valuation allowance
|
(109,784)
|
|
(61,648)
|
|
Net deferred tax assets
|
0
|
|
0
|
|
A reconciliation between the amounts of income tax benefit determined by applying the applicable U.S. and State statutory income tax rate to pre-tax loss is as follows:
GOLIATH FILM AND MEDIA HOLDINGS
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDING APRIL 30, 2013 AND 2012
|
As of April 30, 2013
|
As of April 30, 2012
|
Statutory federal income tax
|
(35%)
|
|
(35.0%)
|
|
Statutory state income tax
|
(6.9%)
|
|
(6.9%)
|
|
Change in valuation allowance
|
|
|
|
|
on deferred tax assets
|
(41.9%)
|
|
(41.9%)
|
|
Due to the inherent uncertainty in forecasts and future events and operating results, the Company has provided for a valuation allowance in an amount equal to gross deferred tax assets resulting in the above figures for the periods audited.
NOTE 9 – CAPITAL STOCK
The Company has authorized 1,000,000 shares of preferred stock, $0.001 par value, with such rights, preferences and designation and to be issued in such series as determined by the Board of Directors. No shares of preferred stock are issued and outstanding at April 30, 2013 or 2012.
The Company has authorized 300,000,000 shares of par value $0.001 common stock, of which 91,265,334 and 67,343,334 shares are outstanding at April 30, 2013 and 2012, respectively.
On October 31, 2011 (the “Closing Date”), China Advanced Technology acquired Goliath Film and Media International, a California corporation, by issuing 47,000,000 shares of its Common Stock, constituting 70.1% of the outstanding shares after giving effect to their issuance and the cancellation of 15,619,816 shares held by China Advanced Technology’s prior control person. Immediately following the Closing, 67,100,000 shares were issued and outstanding, including the 100,000 shares sold. On the Closing Date, the name of China Advanced Technology was changed to Goliath Film and Media Holdings. All share numbers herein have been adjusted for an eight-for-1 forward stock split affected as of the Closing Date. The forward stock split was reflected in the trading market on February 13, 2012. The transaction was accounted for as a reverse acquisition in which Goliath is deemed to be the accounting acquirer, and the prior operations of China Advanced Technology are consolidated for accounting purposes. Since China Advanced Technology had no operations, assets, or liabilities as of the Closing, no audit of that entity was required under the materiality thresholds of Regulation S-X Rule 8-04. In addition, the capital was retroactively adjusted to reflect the reverse acquisition.
During the year ended April 30, 2013, the Company entered into separate private placement memorandums with two affiliate shareholders under which we issued them 1,772,000 shares of our common stock, restricted in accordance with Rule 144, in exchange for $88,600. The issuance was exempt from registration pursuant to Section 4(2) of the Securities Act of 1933, and the investor was sophisticated and familiar with our operations at the time of the issuance of the shares.
On May 1, 2012 the Company issued 250,000 restricted common shares to a non-affiliated third party pursuant to a consulting agreement to assist the Company in the distribution of certain films. In addition, the Company issued 5,266,667 restricted common shares to our Chief Financial Officer pursuant to his consulting contract dated October 27, 2011 and amended May 1, 2012. The Company also issued 633,333 restricted common shares for professional services per consulting contracts dated October 27, 2011 and amended May 1, 2012.
The Company issued 6,000,000 restricted common shares to our President and Chief Executive Officer, pursuant to his employment contract dated May 1, 2012. Further, the Company issued 10,000,000 restricted common shares to our Chief Operating Officer pursuant to her employment contract dated May 1, 2012.
During the year ended April 30, 2012, the Company sold 243,334 restricted common shares to an affiliate shareholder pursuant to a private placement memorandum in exchange for $73,000. Further, the Company issued 100,000 restricted common shares to a non affiliated third party pursuant to a private placement memorandum in exchange for $30,000. The issuance was exempt from registration pursuant to Section 4(2) of the Securities Act of 1933, and the investor was sophisticated and familiar with our operations at the time of the issuance of the shares.
GOLIATH FILM AND MEDIA HOLDINGS
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDING APRIL 30, 2013 AND 2012
On February 26, 2013, the Company filed a Certificate of Amendment to its Restated Certificate of Incorporation with the Secretary of State of the State of Nevada to increase the number of authorized common shares from 149 million to 300 million.
On February 26, 2013, through resolutions adopted by unanimous written consent of the board of directors, the Company approved the increase of authorized common shares from 149 million to 300 million common shares.
NOTE 10 – OPERATING LEASE
On November 1, 2012, we entered into a 12-month lease for 135 square feet of office space. The rent is approximately $471 per month.
The total rent and lease expense was $14,805 and $14,767 for the years ended April 30, 2013 and 2012, respectively.
NOTE 11 – LEGAL
The Company is not a party to or otherwise involved in any legal proceedings.
In the ordinary course of business, from time to time the Company may be involved in various pending or threatened legal actions. The litigation process is inherently uncertain and it is possible that the resolution of such matters might have a material adverse effect upon the Company’s financial condition and/or results of operations. However, in the opinion of management, other than as set forth herein, matters currently pending or threatened against the Company are not expected to have a material adverse effect on its financial position or results of operations.
NOTE 12 – SUBSEQUENT EVENTS
Subsequent to April 30, 2013, we issued a total of 100,000 restricted common shares to an affiliate in accordance with Rule 144, in exchange for approximately $5,000. The issuance was exempt from registration pursuant to Section 4(2) of the Securities Act of 1933, and the investor was sophisticated and familiar with our operations at the time of the issuance of the shares.
Subsequent to April 30, 2013, we issued 495,000 shares of restricted common stock valued at $24,750 to an affiliate in consideration for payment of our Cannes trade show costs. The purpose of the Cannes trade show was to develop relationships among potential customers for the distribution of our films. The issuance was exempt from registration pursuant to Section 4(2) of the Securities Act of 1933, and the investor was sophisticated and familiar with our operations at the time of the issuance of the shares.
GOLIATH FILM AND MEDIA HOLDINGS
(A Development Stage Company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDING APRIL 30, 2013 AND 2012