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Item 2.
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Management’s Discussion and Analysis of Financial
Condition and Results of Operations.
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Description of Business
FORWARD-LOOKING STATEMENTS
This quarterly report contains forward-looking statements. These
statements relate to future events or our future financial performance. These statements often can be identified by the use of
terms such as "may," "will," "expect," "believe," "anticipate," "estimate,"
"approximate" or "continue," or the negative thereof. We intend that such forward-looking statements be subject
to the safe harbors for such statements. We wish to caution readers not to place undue reliance on any such forward-looking statements,
which speak only as of the date made. Any forward-looking statements represent management's best judgment as to what may occur
in the future. However, forward-looking statements are subject to risks, uncertainties and important factors beyond our control
that could cause actual results and events to differ materially from historical results of operations and events and those presently
anticipated or projected. We disclaim any obligation subsequently to revise any forward-looking statements to reflect events or
circumstances after the date of such statement or to reflect the occurrence of anticipated or unanticipated events.
Company
Jin Wan Hong International Holding Ltd. was
incorporated
in the State of Nevada on January 31, 2014. On January 14, 2016, Shu Feng Lu, Hong Xia Li, and Chen Yang took
control of the Company by purchasing shares of common stock from existing shareholders. After the transaction our management is
currently working on new business plan and winding up the current business plan. The Company plans to operate in cultural related
business in the future.
Office
Our principal executive office is located at
1101, Block E, Guang Hua Yuan, 2031 Bin He Nan Road, Fu Tian District, Shenzhen City, China. Our CEO provides our Company with
office space at no charge.
Future Plans
On January 14, 2016, Shu Feng Lu, Hong Xia Li, and Chen Yang took
control of the Company by purchasing shares of common stock from existing shareholders. After the transaction our management is
currently working on a new business plan, and plans on operating in cultural related business in the future. The new business plan
is still under development and evaluation.
Management's Discussion and Analysis of Financial Condition and
Results of Operations
The following discussion should be read in conjunction with our
financial statements, including the notes thereto, appearing elsewhere in this annual report. The following discussion contains
forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from
those discussed in the forward-looking statements. Our audited financial statements are stated in United States Dollars
and are prepared in accordance with United States Generally Accepted Accounting Principles.
GENERAL
On January 14, 2016, Shu Feng Lu, Hong Xia Li, and Chen Yang took
control of the Company by purchasing shares of common stock from existing shareholders. After the transaction our management is
currently working on a new business plan and winding up the current business plan. The Company plans on operating in cultural related
business in the future.
RESULTS OF OPERATIONS
We have incurred recurring losses to date. Our financial statements
have been prepared assuming that we will continue as a going concern and, accordingly, do not include adjustments relating
to the recoverability and realization of assets and classification of liabilities that might be necessary should we be unable to
continue in operation.
We expect we will require additional capital to meet our long term
operating requirements. We expect to raise additional capital through, among other things, the sale of equity or debt securities.
THREE MONTH PERIOD ENDED AUGUST 31, 2016 COMPARED TO AUGUST 31,
2015.
Revenue
We recognized revenue of $0 for the three month period ended August
31, 2016, and for the three month period ended August 31, 2015.
Operating expenses
We incurred operating expenses of $5,700 for the three month period
ended August 31, 2016 compared to $19,609 for the three month period ended August 31, 2015, due to lack of actual business transactions.
Net Losses
Our net loss for the three month period ended August 31, 2016 was
$5,700 compared to a net loss of $19,609 as of the three month period ended August 31, 2015 due to the decrease in expenses.
Liquidity and Capital Resources
As of August 31, 2016, our total assets were $0. Our total liabilities
were $5,700, comprised of a loan from shareholders.. As of August 31, 2015, our total assets were $5,466. Our total liabilities
were $11,500.
Shareholders’ equity was $5,700 as of August 31, 2016.
The Company has accumulated a deficit of ($44,400) as of August
31, 2016, and further losses are anticipated in the development of its business. Accordingly, there is substantial doubt about
the Company’s ability to continue as a going concern.
The ability to continue as a going concern is dependent upon the
Company generating profitable operations in the future and, or, obtaining the necessary financing to meet its obligations and repay
its liabilities arising from normal business operations when they come due. Management intends to finance operating costs over
the next twelve months with existing cash on hand, sales, loans from directors and, or, the private placement of common stock.
Management anticipates that the Company will be dependent, for the
near future, on additional investment capital to fund operating expenses The Company intends to position itself so that it may
be able to raise additional funds through the capital markets. In light of management’s efforts, there are no assurances
that the Company will be successful in this or any of its endeavors or become financially viable and continue as a going concern.
Cash Flows from Operating Activities
We have not generated positive cash flows from operating activities.
For the three month period ended August 31, 2016, net cash flows used in operating activities was $5,700 compared to ($19,609)
for August 31, 2015, due to lack of actual business transactions.
Cash Flows from Investing Activities
We neither used nor generated cash from investing activities for
the three month period ended August 31, 2016 and August 31, 2015.
Cash Flows from Financing Activities
For the three month period ended August 31, 2016, net cash provided
by financing activities was $5,700. For the three month period ended August 31, 2015, net cash provided by financing activities
was $21,000.
PLAN OF OPERATION AND FUNDING
We expect that working capital requirements will continue to be
funded through a combination of our existing funds, sales, loans from a director and further issuances of securities. Our working
capital requirements are expected to increase in line with the growth of our business
We have no lines of credit or other bank financing arrangements.
Generally, we have financed operations to date through the proceeds of the private placement of equity, debt instruments, and limited
sales. In connection with our business plan, management anticipates additional increases in operating expenses and capital expenditures
relating to:
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·
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Legal
and professional fees
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We intend to finance these expenses with further issuances of securities,
debt issuances and sales. Thereafter, we expect we will need to raise additional capital and generate revenues to meet long-term
operating requirements. Additional issuances of equity or convertible debt securities will result in dilution to our current shareholders.
Further, such securities might have rights, preferences or privileges senior to our common stock. Additional financing may not
be available upon acceptable terms, or at all. If adequate funds are not available or are not available on acceptable terms, we
may not be able to take advantage of prospective new business endeavors or opportunities, which could significantly and materially
restrict our business operations.
OFF-BALANCE SHEET ARRANGEMENTS
As of the date of this Report, we do not have any 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 are material
to investors.
SIGNIFCANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying financial statements have been prepared in accordance
with generally accepted accounting principles in the United States of America, and pursuant to the rules and regulations of the
Securities and Exchange Commission (the “SEC”) and reflect all adjustments, consisting of normal recurring adjustments,
which management believes are necessary to fairly present the financial position, results of operations, stockholders’ equity
and cash flows of the Company for three month period ended August 31, 2016.
Accounting Basis
The Company uses the accrual basis of accounting and accounting
principles generally accepted in the United States of America (“GAAP” accounting). The Company has adopted
a May 31 fiscal year end.
Cash and Cash Equivalents
The Company considers all highly liquid investments with the original
maturities of three months or less to be cash equivalents. The Company had $0 cash as of three months period ended August 31, 2016.
Fair Value of Financial Instruments
The Company’s financial instruments consist of cash and cash
equivalents and amounts due to shareholder. The carrying amount of these financial instruments approximates fair value due either
to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed in these financial
statements.
Inventories
Inventories are stated at the lower of cost or market. Cost is principally
determined using the first-in, first out (FIFO) method. The Company had $0 in inventory as of August 31, 2016.
Depreciation, Amortization, and Capitalization
The Company records depreciation and amortization when appropriate
using both straight-line and declining balance methods over the estimated useful life of the assets (five to seven years). Expenditures
for maintenance and repairs are charged to expense as incurred. Additions, major renewals and replacements that increase the property's
useful life are capitalized. Property sold or retired, together with the related accumulated depreciation is removed from the appropriated
accounts and the resultant gain or loss is included in net income.
Income Taxes
Income taxes are computed using the asset and liability method.
Under the asset and liability method, deferred income tax assets and liabilities are determined based on the differences
between the financial reporting and tax bases of assets and liabilities and are measured using the currently enacted tax rates
and laws. A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are
not expected to be realized.
Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles 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 the financial statements and the reported amount
of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Revenue Recognition
The Company recognizes revenue when products are fully delivered
or services have been provided and collection is reasonably assured.
Stock-Based Compensation
Stock-based compensation is accounted for at fair value in accordance
with ASC Topic 718. To date, the Company has not adopted a stock option plan and has not granted any stock options.
Basic Income (Loss) Per Share
Basic income (loss) per share is calculated by dividing the Company’s
net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings
per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average
number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number
of shares adjusted for any potentially dilutive debt or equity. There are no such common stock equivalents outstanding as of August
31, 2016.
Comprehensive Income
The Company has standards for reporting and display of comprehensive
income, its components and accumulated balances. When applicable, the Company would disclose this information on its Statement
of Stockholders’ Equity. Comprehensive income comprises equity except those resulting from investments by owners and
distributions to owners. The Company has not had any significant transactions that are required to be reported in other comprehensive
income.
Recent Accounting Pronouncements
The Company does not expect the adoption of recently issued accounting
pronouncements to have a significant impact on the Company’s results of operations, financial position or cash flow.