(the accompanying notes are an integral part of these audited financial statements)
(the accompanying notes are an integral part of these audited financial statements)
(the accompanying notes are an integral part of these audited financial statements)
(the accompanying notes are an integral part of these audited financial statements)
NOTES TO AUDITED FINANCIAL STATEMENTS
FOR THE YEARS ENDED NOVEMBER 30, 2016 AND 2015
NOTE 1 - ORGANIZATION AND OPERATIONS
Global Smart Capital Corp (formerly TODEX Corp.) (the "Company") was incorporated in Nevada on September 18, 2014 ("Inception"). The Company was a software development company which planned to work in the B2B market by developing accounting software for business management and operations. We were going to develop the software for car dealers around the world. We intended to develop software for both PCs and mobile platforms. On April 13, 2016, through a change of control, new management was appointed and is developing a new business plan for the Company.
NOTE 2 - GOING CONCERN
The Company’s financial statements are prepared using accounting principles generally accepted in the United States of America (“GAAP”) applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company incurred a net loss of $59,937 during the year ended November 30, 2016 and as of the same date had an accumulated deficit of $74,988, compared to a net loss of $14,495 and an accumulated deficit of $15,051 for the year ended November 30, 2015. If the Company is unable to generate profits and is unable to continue to obtain financing for its working capital requirements, it may have to curtail its business sharply or cease business altogether. These factors raise 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, loans from directors and/or private placement of common stock.
NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying financial statements have been prepared using accounting principles generally accepted in the United States of America (“GAAP”), applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company’s year-end is November 30.
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 revenues and expenses during the reporting period. Actual results could differ from those estimates.
Cash and Cash Equivalents
The majority of cash is maintained with a major financial institution in the United States. Generally, these deposits may be redeemed on demand and, therefore, bear minimal risk. The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents.
Fair value of Financial Instruments
The carrying value of cash, deposits, accounts payable, loan from related party and revenue approximates their fair value due to their short-term maturity.
GLOBAL SMART CAPITAL CORP
(formerly TODEX Corp.)
NOTES TO AUDITED FINANCIAL STATEMENTS
FOR THE YEARS ENDED NOVEMBER 30, 2016 AND 2015
Product warranties
Product warranty costs are based on the Company’s estimate of the historical and projected costs if any to cause the Company’s software products to operate according to product specifications and cure any infringement claims.
Income Taxes
The Company accounts for income taxes using the asset and liability method in accordance with ASC 740, Accounting for Income Taxes. The asset and liability method provides that deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities, and for operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using the currently enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized.
When tax returns are filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the position taken or the amount of the position that would be ultimately sustained. In accordance with ASC 740-10, the benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions taken are not offset or aggregated with other positions. Tax positions that meet the more-likely-than-not recognition threshold are measured as the largest amount of tax benefit that is more than 50 percent likely of being realized upon settlement with the applicable taxing authority. The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above should be reflected as a liability for unrecognized tax benefits in the accompanying balance sheets along with any associated interest and penalties that would be payable to the taxing authorities upon examination.
Revenue Recognition
The Company recognizes revenue when it is realized or realizable and earned. The Company considers revenue realized or realizable and earned when all of the following criteria are met: (i) persuasive evidence of an arrangement exists, (ii) the product has been shipped or the services have been rendered to the customer, (iii) the sales price is fixed or determinable, and (iv) the collectability is reasonably assured.
The Company’s revenue consists of proceeds from sales of the designing, developing and implementing applications software.
Basic and Diluted Earnings (Loss) Per Share
The Company computes earnings (loss) per share in accordance with ASC 260-10-45 “Earnings per Share”, which requires presentation of both basic and diluted earnings per share on the face of the statement of operations. Basic earnings (loss) per share is computed by dividing net earnings (loss) available to common stockholders by the weighted average number of outstanding common shares during the period. Diluted earnings (loss) per share gives effect to all dilutive potential common shares outstanding during the period. Dilutive earnings (loss) per share excludes all potential common shares if their effect is anti-dilutive. The Company had no potentially dilutive debt or equity instruments issued and outstanding during the year ended November 30, 2016 and therefore basic and diluted earnings (loss) per share are equal.
GLOBAL SMART CAPITAL CORP
(formerly TODEX Corp.)
NOTES TO AUDITED FINANCIAL STATEMENTS
FOR THE YEARS ENDED NOVEMBER 30, 2016 AND 2015
Recently Adopted Accounting Pronouncements
The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new pronouncements that have been issued that might have a material impact on its financial position or results of operations.
NOTE 4 – STOCKHOLDERS’ EQUITY
The Company has 75,000,000 common shares authorized with a par value of $ 0.001 per share.
For the year ended November 30, 2015, the Company issued 2,580,000 shares at $0.01 per share for total proceeds of $25,800.
As of November 30, 2016, and November 30, 2015, the Company had 8,580,000 common shares issued and outstanding.
NOTE 5 – RELATED PARTY TRANSACTIONS
In support of the Company's efforts and cash requirements, it may rely on advances from related parties until such time that the Company can support its operations or attains adequate financing through sales of its equity or traditional debt financing. There is no formal written commitment for continued support by shareholders. Amounts represent advances or amounts paid in satisfaction of liabilities. The advances are considered temporary in nature and have not been formalized by a promissory note.
On November 30, 2015, the Company owed the former Director and President of the Company, $3,686, which was advanced to the Company, for operating expenses. On April 5, 2016, the total balance of $3,686, owing to the retiring Director and President, was forgiven and transferred to additional paid in capital, along with an additional $1,500 that was subsequently advanced.
On April 13, 2016, in connection with the purchase and sale of a majority of the Company’s outstanding shares of common stock, Vladislav Emolovich resigned from all positions held, after appointing Dominic Chappell as the Company’s sole officer and director.
On May 6, 2016, and subsequently through November 30, 2016, the current sole Officer and Director made unsecured, non-interest bearing cash advances, to pay operating costs, to the Company, in the amount of $35,043. The entire balance remained unpaid at November 30, 2016.
NOTE 6 – COMMITMENTS AND CONTINGENCIES
Contractual
The Company had leased office space in Las Vegas Nevada for use as its Corporate Headquarters. The term of the lease was month to month, so there was no related material commitment or contingency associated with this agreement. The Company's new management has discontinued the use of this facility and has provided space on an as needed basis at no cost.
Litigation
We were not subject to any legal proceedings during the years ended November 30, 2015 and 2016. No legal proceedings are currently pending or threatened, to the best of our knowledge.
GLOBAL SMART CAPITAL CORP
(formerly TODEX Corp.)
NOTES TO AUDITED FINANCIAL STATEMENTS
FOR THE YEARS ENDED NOVEMBER 30, 2016 AND 2015
Product Warranties
The Company warrants that its software products will operate according to the software’s specifications for a period of one year following acceptance by the Company’s customers. In the event its software products do not operate in accordance with a software’s specifications, the Company takes all actions necessary to cause the software to operate according to the software’s specifications at the Company’s expense.
The Company also warrants that its software products will not infringe upon any copyright, patent, trade secret or other intellectual property interest of any third party. In the event of a claim of infringement, the Company will secure the right of its customers to use the software product without infringement at the Company’s expense.
As of November 30, 2016, there were no claims for warranty expenses outstanding. Exposure to product warranty liabilities are considered nominal due to the Company’s limited operating and sales history.
NOTE 7 – DISCLOSURE OF MAJOR CUSTOMERS
During the years ended November 30, 2016, and 2015 one customer accounted for 0% and 100% of total sales, respectively.
NOTE 8 – INCOME TAXES
As of November 30, 2016 the Company had net operating loss carry forwards of $74,988 that may be available to reduce future years’ taxable income through 2036. The years 2014 to 2015 remain subject to examination by the Company’s major tax jurisdictions. Future tax benefits which may arise as a result of these losses have not been recognized in these financial statements, as their realization is determined not likely to occur and accordingly, the Company has recorded a valuation allowance for the deferred tax asset relating to these tax loss carry-forwards.
The provision for Federal income tax consists of the following:
|
|
November 30,
2016
|
|
|
November 30,
2015
|
|
Federal income tax benefit (at 34%) attributable to:
|
|
|
|
|
|
|
Current Operations - net loss
|
|
$
|
20,379
|
|
|
$
|
4,928
|
|
Less: change in valuation allowance
|
|
|
(20,568
|
)
|
|
|
(4,928
|
)
|
Other differences
|
|
|
189
|
|
|
|
-
|
|
Net provision for Federal income taxes
|
|
$
|
-
|
|
|
$
|
-
|
|
GLOBAL SMART CAPITAL CORP
(formerly TODEX Corp.)
NOTES TO AUDITED FINANCIAL STATEMENTS
FOR THE YEARS ENDED NOVEMBER 30, 2016 AND 2015
The cumulative tax effect at the expected rate of 34% of significant items comprising our net deferred tax amount is as follows:
|
|
November 30,
2016
|
|
|
November 30,
2015
|
|
Deferred tax asset attributable to:
|
|
|
|
|
|
|
Net operating loss carryover
|
|
$
|
25,496
|
|
|
$
|
4,928
|
|
Less: valuation allowance
|
|
|
(25,496
|
)
|
|
|
(4,928
|
)
|
|
|
$
|
-
|
|
|
$
|
-
|
|
NOTE 9 – SUBSEQUENT EVENTS
On December 30, 2016, our majority shareholder, Retail Acquisitions Limited, sold its entire interest in the Company, consisting of 6,000,000 shares of our common stock, in three separate transfers of 2,000,000 shares each, to three investors: Ranxu Fu, Mak Shee Fu and Roux and Sons Hk. Ltd. The shares sold by Retail Acquisitions Limited constitute 69.93% of the 8,580,000 shares of common stock issued and outstanding.
On February 2, 2017, the sole director and officer approved a resolution allowing the Company to change its name to Global Smart Capital Corp.
On February 6, 2017, the Company’s sole director and officer appointed the following additional directors and officers:
Mr. Johannes Petrus Roux, Director, Chairman and CEO
Mr. Shee Fu Mak, Director, Co-chairman
Mr. Fu Ranxu, Director