NOTES TO CONDENSED FINANCIAL STATEMENTS
Note 1 Background
B Green Innovations, Inc., a Matawan, New
Jersey-based corporation, (OTC Pink® marketplace: BGNN), formerly iVoice Technology, Inc., (“B Green
Innovations” or the “Company”) was incorporated under the laws of New Jersey on November 10, 2004 as a
wholly owned subsidiary of iVoice, Inc. (“iVoice”). In May 2008, the Company formed B Green Innovations, Inc.
(“B Green”), a wholly-owned subsidiary to commercialize its “green” technology platforms.
On November 17, 2009, pursuant to an Agreement
and Plan of Merger (the “Merger Agreement”), B Green Innovations, Inc., a wholly owned subsidiary of iVoice Technology,
Inc., merged into iVoice Technology, Inc.
On July 28, 2009, the Board of Directors and
shareholders through written consent representing a majority of the total voting Class A and Class B Common stock voted to change
the name of the Company to B Green Innovations, Inc. On November 20, 2009, the Company filed an Amendment to the Certificate
of Incorporation with the State of New Jersey to officially change the name of the Company.
On October 8, 2016, the Registrant’s
Board of Directors, acting pursuant to its Amended Articles of Incorporation, unanimously approved to change the name of the Registrant
from B Green Innovations, Inc. to 024 Pharma, Inc. by amending Article One of the Registrant’s Articles of Incorporation.
The purpose of the name change is to more fully encapsulate the Registrant’s current operations and business direction. The
New Jersey Secretary of State, effective October 12, 2016, processed the name change and the Registrant has filed for a symbol
change with the Financial Industry Regulatory Authority (“FINRA”). The Company will also obtain a new CUSIP number
in connection with the name change.
Note 2 Business Operations
024 Pharma, Inc. provides the best
nutrition in every area that matters. From vitamin and mineral supplements, stress release, joint and heart health, and weight-loss
products, skin care, healthy hair and anti-aging.
024 Pharma, Inc. gives you what you
need to create healthier lives for you and your family.
024 Pharma, Inc. is known in the
international market for its unique global shareholders system. Company promotes the concept of "People-oriented, Just and
Equitable" which received high appraisal from the majority of the personage from the industry. Everyone can join and become
a shareholder. Everyone can share the return on 024's Pharma, Inc's investment. 024 Pharma, Inc. is destined to become the most
influential and competitive shareholders group.
024 Pharma’s premium quality
products do more than improve people’s health—they transform their lives. Sourced, manufactured and tested against
the most rigorous quality standards, our unique product portfolio delivers more than over 220 personalized solutions to optimize
your health.
Company’s staff science team
formulates products with a relentless commitment to ingredient purity and potency. That’s why customers trust theirr products
to deliver proven, repeatable results.
024 Pharma make and package products
in their own facility, under conditions and guidelines that meet the most stringent global regulations.
Outfitted with state-of-the-art instrumentation
and combining the skills of accomplished scientists, researchers and medical professionals, our research lab creates a unique environment
in which to pursue scientific discovery and advancement, and it is the hub of our product development and testing.
Note 3 Going Concern
The accompanying condensed financial statements
have been prepared in conformity with accounting principles generally accepted in the United States of America, which contemplates
continuation of the Company as a going concern.
Management plans to increase the development,
manufacture, and distribution of products to generate a positive cash flow.
Note 4 Summary of Significant
Accounting Policies
a) Basis of
Presentation
The accompanying condensed unaudited
interim financial statements included herein have been prepared, without audit, pursuant to the rules and regulations of the
Securities and Exchange Commission ("SEC"). The condensed financial statements and notes are presented as permitted
on Form 10-Q and do not contain information included in the Company's annual statements and notes. Certain information and
footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally
accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations, although the
Company believes that the disclosures are adequate to make the information presented not misleading. It is suggested that
these condensed financial statements be read in conjunction with the December 31, 2015 financial statements and the
accompanying notes thereto. While management believes the procedures followed in preparing these condensed financial
statements are reasonable, the accuracy of the amounts are in some respects dependent upon the facts that will exist, and
procedures that will be accomplished by the Company later in the year. These results are not necessarily indicative of the
results to be expected for the full year.
These condensed unaudited financial statements
reflect all adjustments, including normal recurring adjustments, which, in the opinion of management, are necessary to present
fairly the operations and cash flows for the periods presented.
b) 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 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 period. Actual results
could differ from those estimates.
c) Revenue
Recognition
In addition to cash flow generated
from sale of natural supplements such as:
Company intends to produce the “health
phone” that will significantly increase demand in their product and enlarge the product purchase. Clients will be able to
purchase products through this smartphone and it contains application that measure heartbeat, calories, fat, excises schedule etc.
The most important thing is that clients will have this option to talk to health specialists.
d) Product Warranties
The Company estimates its warranty costs based
on historical warranty claims experience in estimating potential warranty claims. Management has determined that warranty costs
are immaterial and has not included an accrual for potential warranty claims. Presently, costs related to warranty coverage are
expensed as incurred. Warranty claims are reviewed quarterly to verify that warranty liabilities properly reflect any remaining
obligation based on the anticipated expenditures over the balance of the obligation period.
e) Research
and Development Costs
Research and development costs are charged
to expense when incurred. The Company has not incurred any research and development costs for the nine months ended September 30,
2016.
f) Advertising
Costs
Advertising costs are expensed as incurred
and are included in selling expenses. The Company has incurred advertising costs for the nine months ended September 30, 2016 and
it counts $19,210.46 USD.
g) Cash and
Cash Equivalents
The Company considers all highly liquid
investments purchased with original maturities of three months or less to be cash equivalents. There were no cash equivalents
at September 30, 2016 and December 31, 2015. The Company maintains cash balances at financial institutions that are
insured by the Federal Deposit Insurance Corporation (“FDIC”) up to federally insured limits. At times balances
may exceed FDIC insured limits. The Company has not experienced any losses in such accounts.
h) Concentration
of Credit Risk
Financial instruments that potentially subject
the Company to concentrations of credit risk consist primarily of trade accounts receivable and cash. As of September
30, 2016 the Company believes it has no significant risk related to its concentration within its accounts receivable.
j) Accounts Receivable
Accounts receivable are non-interest bearing
obligations due under normal trade terms. Senior management reviews accounts receivable on a monthly basis to determine if any
receivables will be potentially uncollectible. Historical bad debts and current economic trends are used in evaluating the allowance
for doubtful accounts. The Company includes any accounts receivable balances that are determined to be uncollectible, along with
a general reserve, in its overall allowance for doubtful accounts. After all attempts to collect a receivable have failed, the
receivable is written off against the allowance. Based on the information available, the Company believes its allowance for doubtful
accounts as of September 30, 2016 and December 31, 2015 is adequate.
j) Property and
Equipment
Property and equipment is stated at cost. Depreciation
is computed using the straight-line method based upon the estimated useful lives of the assets, generally five to seven years.
Maintenance and repairs are charged to expense as incurred.
k) Intangible Assets
Registration and maintenance costs associated
with the filing and registration of patents are prepaid and amortized over the remaining life of the patent, not to exceed 20 years.
Costs associated with such patents are not approved or abandoned.
l) Income Taxes
The Company accounts for income taxes using
the asset and liability method described in FASB ASC 740. Deferred tax assets arise from a variety of sources, the most significant
being: a) tax losses that can be carried forward to be utilized against profits in future years; b) expenses recognized in the
books but disallowed in the tax return until the associated cash flow occurs; and c) valuation changes of assets which need to
be tax effected for book purposes but are deductible only when the valuation change is realized.
Deferred tax assets and liabilities are determined
based on differences between financial reporting and tax basis of assets and liabilities and are measured using enacted tax rates
and laws that are expected to be in effect when such differences are expected to reverse. The measurement of deferred
tax assets is reduced, if necessary, by a valuation allowance for any tax benefit, which is not more likely than not to be realized.
In assessing the need for a valuation allowance, future taxable income is estimated, considering the realization of tax loss carryforwards.
Valuation allowances related to deferred tax assets can also be affected by changes to tax laws, changes to statutory tax rates
and future taxable income levels. In the event it was determined, that the Company would not be able to realize all or a portion
of our deferred tax assets in the future, we would reduce such amounts through a charge to income in the period in which that determination
is made. Conversely, if we were to determine that we would be able to realize our deferred tax assets in the future in excess of
the net carrying amounts, we would decrease the recorded valuation allowance through an increase to income in the period in which
that determination is made. In its evaluation of a valuation allowance, the Company takes into account existing contracts
and backlog, and the probability that options under these contract awards will be exercised as well as sales of existing products.
The Company prepares profit projections based on the revenue and expenses forecast to determine that such revenues will produce
sufficient taxable income to realize the deferred tax assets.
The Company adopted FASB ASC 740-10-50, Accounting
for Uncertainty in Income Taxes. ASC 740-10-50 prescribes a recognition threshold and measurement attribute for the financial statement
recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC 740-10 requires that the Company
determine whether the benefits of its tax positions are more-likely-than-not of being sustained upon audit based on the technical
merits of the tax position. The Company recognizes the impact of an uncertain income tax position taken on its income tax return
at the largest amount that is more-likely-than-not to be sustained upon audit by the relevant taxing authority.
Despite the Company’s belief that its
tax return positions are consistent with applicable tax laws, one or more positions may be challenged by taxing authorities. Settlement
of any challenge can result in no change, a complete disallowance, or some partial adjustment reached through negotiations or litigation.
Interest and penalties related to
income tax matters, if applicable, will be recognized as income tax expense. During the three and nine months ended September
30, 2016 and 2015, the Company did not incur any expense related to interest or penalties for income tax matters, and no such
amounts were accrued as of September 30, 2016 and December 31, 2015.
m) Fair Value
of Financial Instruments
The carrying amounts reported in the
balance sheets as of September 30, 2016 and December 31, 2015 for cash and cash equivalents, marketable securities,
accounts receivable, inventories, prepaid expenses and other current assets, accounts payable and accrued expenses other
current liabilities approximate the fair value because of the immediate or short-term maturity of these financial
instruments. The fair value of the debt approximates its carrying value at the stated discount rate of the debt to
reflect recent market conditions.
n) Long-Lived
Assets
The Company assesses the recoverability of
the carrying value of its long-lived assets whenever events or changes in circumstances indicate that the carrying amount of an
asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of
an asset to future, undiscounted cash flows expected to be generated by an asset. If such assets are considered to be impaired,
the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of
the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. No impairment
losses were recognized for the three and nine months ended September 30, 2016 and 2015.
o) Recent Accounting Pronouncements
There were various other updates recently
issued, most of which represented technical corrections to the accounting literature or application to specific industries and
are not expected to a have a material impact on the Company's financial position, results of operations or cash flows.