NOTES TO CONSOLIDATED FINANCIAL STATEMENT
SEPTEMBER 30, 2016
Note 1 – Nature of
business and basis of presentation
Malaysia Pro-Guardians Security
Management Corporation, formerly known as “Alliance Petroleum Corporation” (the “Company”) was incorporated
on September 17, 2010, under the laws of the State of Nevada.
On January 14, 2013, Alliance changed its name to Malaysia
Pro-Guardians Security Management Corporation (the “Company”). The Company engages in Security service.
On August 13, 2014, the Company formed Proguard Management Services
Malaysia SDN. BHD ("PMSM"), a wholly-owned subsidiary under the laws of Malaysia. PMSM engaged in the security management
service including security management implementation plan, professional training consultation and technical consultation.
Note 2 - Significant and Critical Accounting Policies and Practices
The Management of the Company
is responsible for the selection and use of appropriate accounting policies and the appropriateness of accounting policies and
their application. Critical accounting policies and practices are those that are both most important to the portrayal of the Company’s
financial condition and results and require management’s most difficult, subjective, or complex judgments, often as a result
of the need to make estimates about the effects of matters that are inherently uncertain. The Company’s significant and critical
accounting policies and practices are disclosed below as required by generally accepted accounting principles.
Basis of Presentation
The Company reports revenues
and expenses using the accrual method of accounting for financial and tax reporting purpose. These financial statements are presented
in United States dollars and have been prepared in accordance with United States generally accepted accounting principles.
Use of Estimates and Assumptions and Critical Accounting Estimates
and Assumptions
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(s) of the financial
statements and the reported amounts of revenues and expenses during the reporting period(s).
Critical accounting estimates
are estimates for which (a) the nature of the estimate is material due to the levels of subjectivity and judgment necessary to
account for highly uncertain matters or the susceptibility of such matters to change and (b) the impact of the estimate on financial
condition or operating performance is material. The Company’s critical accounting estimates and assumptions affecting the
financial statements were:
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(i)
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Assumption as a going concern
:
Management
assumes that the Company will continue as a going concern, which contemplates continuity of operations, realization of assets,
and liquidation of liabilities in the normal course of business
.
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(ii)
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Allowance for doubtful accounts
:
Management’s
estimate of the allowance for doubtful
accounts is based on historical sales, historical loss levels, and an analysis of the collectability of individual accounts;
and
general economic conditions that may affect a client’s ability to pay
. The Company
evaluated the key factors and assumptions used to develop the allowance in determining that it is reasonable in relation to the
financial statements taken as a whole.
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(iii)
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Valuation allowance for deferred tax
assets
:
Management assumes that the realization of the Company’s net deferred tax
assets resulting from its net operating loss (“NOL”) carry–forwards for Federal income tax purposes that may
be offset against future taxable income was not considered more likely than not and accordingly, the potential tax benefits of
the net loss carry-forwards are offset by a full valuation allowance. Management made this assumption based on (a) the Company
has incurred recurring losses, (b) general economic conditions, and (c) its ability to raise additional funds to support its daily
operations by way of a public or private offering, among other factors.
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These significant accounting estimates or assumptions bear the risk
of change due to the fact that there are uncertainties attached to these estimates or assumptions, and certain estimates or assumptions
are difficult to measure or value.
Management bases its estimates on historical experience and on various
assumptions that are believed to be reasonable in relation to the financial statements taken as a whole under the circumstances,
the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily
apparent from other sources.
Management regularly evaluates the key factors and assumptions used
to develop the estimates utilizing currently available information, changes in facts and circumstances, historical experience and
reasonable assumptions. After such evaluations, if deemed appropriate, those estimates are adjusted accordingly.
Actual results could differ from those estimates.
Principles of Consolidation
The Company applies the guidance of Topic 810
“Consolidation”
of the FASB Accounting Standards Codification to determine whether and how to consolidate another entity. Pursuant to ASC Paragraph
810-10-15-10 all majority-owned subsidiaries—all entities in which a parent has a controlling financial interest—shall
be consolidated except (1) when control does not rest with the parent, the majority owner; (2) if the parent is a broker-dealer
within the scope of Topic 940 and control is likely to be temporary; (3) consolidation by an investment company within the scope
of Topic 946 of a non-investment-company investee. Pursuant to ASC Paragraph 810-10-15-8 the usual condition for a controlling
financial interest is ownership of a majority voting interest, and, therefore, as a general rule ownership by one reporting entity,
directly or indirectly, of more than 50 percent of the outstanding voting shares of another entity is a condition pointing toward
consolidation. The power to control may also exist with a lesser percentage of ownership, for example, by contract, lease, agreement
with other stockholders, or by court decree. The Company consolidates all less-than-majority-owned subsidiaries, if any, in which
the parent’s power to control exists.
The Company's consolidated
subsidiaries
and/or entities are
as follows:
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Name of consolidated subsidiary or entity
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State or other jurisdiction of incorporation or organization
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Date of incorporation or formation
(date of acquisition, if applicable)
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Attributable interest
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Proguard Management Services Malaysia SDN. BHD
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Kuala Lumpur, Malaysia
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August 13, 2014
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100%
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The consolidated financial statements include all accounts of the
Company and its consolidated subsidiaries and/or entities as of the reporting period ending date(s) and for the reporting period(s).
All inter-company balances and transactions have been eliminated.
Fair Value of Financial Instruments
The Company follows paragraph 825-10-50-10 of the FASB Accounting
Standards Codification for disclosures about fair value of its financial instruments and paragraph 820-10-35-37 of the FASB Accounting
Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph
820-10-35-37 establishes a framework for measuring fair value in generally accepted accounting principles (GAAP), and expands disclosures
about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, Paragraph
820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value
into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets
for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy
defined by Paragraph 820-10-35-37 are described below:
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Level 1
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Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.
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Level 2
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Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.
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Level 3
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Pricing inputs that are generally observable inputs and not corroborated by market data.
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Financial assets are considered Level 3 when their fair values are
determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption
or input is unobservable.
The fair value hierarchy gives the highest priority to quoted prices
(unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. If the inputs
used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based
on the lowest level input that is significant to the fair value measurement of the instrument.
The carrying amounts of the Company’s financial assets and
liabilities, such as cash, accounts receivable, accounts payable, accrued expenses and other current liabilities approximate their
fair values because of the short maturity of these instruments.
Transactions involving related parties cannot be presumed to be
carried out on an arm's-length basis, as the requisite conditions of competitive, free-market dealings may not exist. Representations
about transactions with related parties, if made, shall not imply that the related party transactions were consummated on terms
equivalent to those that prevail in arm's-length transactions unless such representations can be substantiated.
Accounts Receivable and Allowance for Doubtful Accounts
Pursuant to FASB ASC paragraph 310-10-35-47 trade receivables that
management has the intent and ability to hold for the foreseeable future shall be reported in the balance sheet at outstanding
principal adjusted for any charge-offs and the allowance for doubtful accounts.. The Company follows FASB ASC paragraphs 310-10-35-7
through 310-10-35-10 to estimate the allowance for doubtful accounts. Pursuant to FASB ASC paragraph 310-10-35-9 Losses from uncollectible
receivables shall be accrued when both of the following conditions are met: (a) Information available before the financial statements
are issued or are available to be issued (as discussed in Section 855-10-25) indicates that it is probable that an asset has been
impaired at the date of the financial statements, and (b) The amount of the loss can be reasonably estimated. Those conditions
may be considered in relation to individual receivables or in relation to groups of similar types of receivables. If the conditions
are met, accrual shall be made even though the particular receivables that are uncollectible may not be identifiable. The Company
reviews individually each trade receivable for collectability and performs on-going credit evaluations of its customers and adjusts
credit limits based upon payment history and the customer’s current credit worthiness, as determined by the review of their
current credit information; and determines the allowance for doubtful accounts based on historical write-off experience, customer
specific facts and general economic conditions that may affect a client’s ability to pay. Bad debt expense is included in
general and administrative expenses, if any.
Pursuant to FASB ASC paragraph 310-10-35-41 Credit losses for trade
receivables (uncollectible trade receivables), which may be for all or part of a particular trade receivable, shall be deducted
from the allowance. The related trade receivable balance shall be charged off in the period in which the trade receivables are
deemed uncollectible. Recoveries of trade receivables previously charged off shall be recorded when received. The Company charges
off its trade account receivables against the allowance after all means of collection have been exhausted and the potential for
recovery is considered remote.
Related Parties
The Company follows subtopic 850-10 of the FASB Accounting Standards
Codification for the identification of related parties and disclosure of related party transactions.
Pursuant to Section 850-10-20 the related parties include a. affiliates
(“Affiliate” means, with respect to any specified Person, any other Person that, directly or indirectly through one
or more intermediaries, controls, is controlled by or is under common control with such Person, as such terms are used in and construed
under Rule 405 under the Securities Act) of the Company; b. entities for which investments in their equity securities would
be required, absent the election of the fair value option under the Fair Value Option Subsection of Section 825–10–15,
to be accounted for by the equity method by the investing entity; c. trusts for the benefit of employees, such as pension
and profit-sharing trusts that are managed by or under the trusteeship of management; d. principal owners of the Company; e. management
of the Company; f. other parties with which the Company may deal if one party controls or can significantly influence the
management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing
its own separate interests; and g. other parties that can significantly influence the management or operating policies of
the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the
other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests.
The financial statements shall include disclosures of material related
party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of
business. However, disclosure of transactions that are eliminated in the preparation of consolidated or combined financial statements
is not required in those statements. The disclosures shall include: a. the nature of the relationship(s) involved; b. a description
of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which
income statements are presented, and such other information deemed necessary to an understanding of the effects of the transactions
on the financial statements; c. the dollar amounts of transactions for each of the periods for which income statements are
presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and d.
amounts due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms
and manner of settlement.
Commitment and Contingencies
The Company follows subtopic 450-20 of the FASB Accounting Standards
Codification to report accounting for contingencies. Certain conditions may exist as of the date the financial statements are issued,
which may result in a loss to the Company but which will only be resolved when one or more future events occur or fail to occur.
The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing
loss contingencies related to legal proceedings that are pending against the Company or un-asserted claims that may result in such
proceedings, the Company evaluates the perceived merits of any legal proceedings or un-asserted claims as well as the perceived
merits of the amount of relief sought or expected to be sought therein.
If the assessment of a contingency indicates that it is probable
that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be
accrued in the Company’s financial statements. If the assessment indicates that a potential material loss contingency is
not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and
an estimate of the range of possible losses, if determinable and material, would be disclosed.
Loss contingencies considered remote are generally not disclosed
unless they involve guarantees, in which case the guarantees would be disclosed.
Revenue Recognition
The Company follows paragraph 605-10-S99-1 of the FASB Accounting
Standards Codification for 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)collectability is reasonably assured.
Deferred Tax Assets and Income Tax Provision
The Company accounts for income taxes under Section 740-10-30 of
the FASB Accounting Standards Codification. Deferred income tax assets and liabilities are determined based upon differences between
the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will
be in effect when the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent
management concludes it is more likely than not that the assets will not be realized. 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. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the statements
of operations in the period that includes the enactment date.
The Company adopted section 740-10-25 of the FASB Accounting Standards
Codification (“Section 740-10-25”). Section 740-10-25 addresses the determination of whether tax benefits claimed or
expected to be claimed on a tax return should be recorded in the financial statements. Under Section 740-10-25, the Company may
recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained
on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial
statements from such a position should be measured based on the largest benefit that has a greater than fifty percent (50%) likelihood
of being realized upon ultimate settlement. Section 740-10-25 also provides guidance on de-recognition, classification, interest
and penalties on income taxes, accounting in interim periods and requires increased disclosures.
The estimated future tax effects of temporary differences between
the tax basis of assets and liabilities are reported in the accompanying balance sheets, as well as tax credit carry-backs and
carry-forwards. The Company periodically reviews the recoverability of deferred tax assets recorded on its balance sheets and provides
valuation allowances as management deems necessary.
Management makes judgments as to the interpretation of the tax laws
that might be challenged upon an audit and cause changes to previous estimates of tax liability. In addition, the Company operates
within multiple taxing jurisdictions and is subject to audit in these jurisdictions. In management’s opinion, adequate provisions
for income taxes have been made for all years. If actual taxable income by tax jurisdiction varies from estimates, additional allowances
or reversals of reserves may be necessary.
Tax years that remain subject to examination
by major tax jurisdictions
The Company discloses
tax years that
remain subject to examination by major tax jurisdictions
pursuant to the ASC Paragraph 740-10-50-15.
Earnings per Share
Earnings per share ("EPS") is the amount of earnings attributable
to each share of common stock. For convenience, the term is used to refer to either earnings or loss per share. EPS is computed
pursuant to section 260-10-45 of the FASB Accounting Standards Codification. Pursuant to ASC Paragraphs 260-10-45-10 through 260-10-45-16
Basic EPS shall be computed by dividing income available to common stockholders (the numerator) by the weighted-average number
of common shares outstanding (the denominator) during the period. Income available to common stockholders shall be computed by
deducting both the dividends declared in the period on preferred stock (whether or not paid) and the dividends accumulated for
the period on cumulative preferred stock (whether or not earned) from income from continuing operations (if that amount appears
in the income statement) and also from net income. The computation of diluted EPS is similar to the computation of basic EPS except
that the denominator is increased to include the number of additional common shares that would have been outstanding if the dilutive
potential common shares had been issued during the period to reflect the potential dilution that could occur from common shares
issuable through contingent shares issuance arrangement, stock options or warrants.
Pursuant to ASC Paragraphs 260-10-45-45-21 through 260-10-45-45-23
Diluted EPS shall be based on the most advantageous conversion rate or exercise price from the standpoint of the security holder.
The dilutive effect of outstanding call options and warrants (and their equivalents) issued by the reporting entity shall be reflected
in diluted EPS by application of the treasury stock method unless the provisions of paragraphs 260-10-45-35 through 45-36 and 260-10-55-8
through 55-11 require that another method be applied. Equivalents of options and warrants include non-vested stock granted to employees,
stock purchase contracts, and partially paid stock subscriptions (see paragraph 260–10–55–23). Anti-dilutive
contracts, such as purchased put options and purchased call options, shall be excluded from diluted EPS. Under the treasury stock
method: a. Exercise of options and warrants shall be assumed at the beginning of the period (or at time of issuance, if later)
and common shares shall be assumed to be issued. b. The proceeds from exercise shall be assumed to be used to purchase common
stock at the average market price during the period. (See paragraphs 260-10-45-29 and 260-10-55-4 through 55-5.) c. The incremental
shares (the difference between the number of shares assumed issued and the number of shares assumed purchased) shall be included
in the denominator of the diluted EPS computation.
There were no contingent shares issuance arrangement, stock options
or warrants which could have potentially dilutive effect for the reporting period ended September 30, 2016 or 2015.
Cash Flows Reporting
The Company adopted paragraph 230-10-45-24 of the FASB Accounting
Standards Codification for cash flows reporting, classifies cash receipts and payments according to whether they stem from operating,
investing, or financing activities and provides definitions of each category, and uses the indirect or reconciliation method (“Indirect
method”) as defined by paragraph 230-10-45-25 of the FASB Accounting Standards Codification to report net cash flow from
operating activities by adjusting net income to reconcile it to net cash flow from operating activities by removing the effects
of (a) all deferrals of past operating cash receipts and payments and all accruals of expected future operating cash receipts and
payments and (b) all items that are included in net income that do not affect operating cash receipts and payments. The Company
reports the reporting currency equivalent of foreign currency cash flows, using the current exchange rate at the time of the cash
flows and the effect of exchange rate changes on cash held in foreign currencies is reported as a separate item in the reconciliation
of beginning and ending balances of cash and cash equivalents and separately provides information about investing and financing
activities not resulting in cash receipts or payments in the period pursuant to paragraph 830-230-45-1 of the FASB Accounting Standards
Codification.
Subsequent Events
The Company follows the guidance in Section 855-10-50 of the FASB
Accounting Standards Codification for the disclosure of subsequent events. The Company will evaluate subsequent events through
the date when the financial statements were issued. Pursuant to ASU 2010-09 of the FASB Accounting Standards Codification,
the Company as an SEC filer considers its financial statements issued when they are widely distributed to users, such as through
filing them on EDGAR.
Recently Issued Accounting Pronouncements
In May 2014, the FASB issued the FASB Accounting Standards Update
No. 2014-09 “
Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”).
This guidance amends the existing FASB Accounting Standards Codification,
creating a new Topic 606,
Revenue from Contracts with Customer.
The core principle
of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in
an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.
To achieve that core principle, an entity should apply the following
steps:
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Identify the contract(s) with the customer
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Identify the performance obligations in the contract
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Determine the transaction price
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Allocate the transaction price to the performance obligations in the
contract
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Recognize revenue when (or as) the entity satisfies a performance obligations
The ASU also provides guidance on disclosures that should be provided
to enable financial statement users to understand the nature, amount, timing, and uncertainty of revenue recognition and cash flows
arising from contracts with customers. Qualitative and quantitative information is required about the following:
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Contracts with customers
– including revenue and
impairments recognized, disaggregation of revenue, and information about contract balances and performance obligations (including
the transaction price allocated to the remaining performance obligations)
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Significant judgments and changes in judgments
–
determining the timing of satisfaction of performance obligations (over time or at a point in time), and determining the transaction
price and amounts allocated to performance obligations
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Assets recognized from the costs to obtain or fulfill a contract.
ASU 2014-09 is effective for periods beginning after December 15,
2016, including interim reporting periods within that reporting period for all public entities. Early application is not
permitted.
In June 2014, the FASB issued ASU No. 2014-10, Development Stage
Entities (Topic 915): Elimination of Certain Financial Reporting Requirements, Including an Amendment to Variable Interest Entities
Guidance in Topic 810, Consolidation.
The amendments in this Update remove the definition of a development
stage entity from the Master Glossary of the Accounting Standards Codification, thereby removing the financial reporting distinction
between development stage entities and other reporting entities from U.S. GAAP. In addition, the amendments eliminate the requirements
for development stage entities to (1) present inception-to-date information in the statements of income, cash flows, and shareholder
equity, (2) label the financial statements as those of a development stage entity, (3) disclose a description of the development
stage activities in which the entity is engaged, and (4) disclose in the first year in which the entity is no longer a development
stage entity that in prior years it had been in the development stage.
The amendments also clarify that the guidance in Topic 275, Risks
and Uncertainties, is applicable to entities that have not commenced planned principal operations.
Finally, the amendments remove paragraph 810-10-15-16. Paragraph
810-10-15-16 states that a development stage entity does not meet the condition in paragraph 810-10-15-14(a) to be a variable interest
entity if (1) the entity can demonstrate that the equity invested in the legal entity is sufficient to permit it to finance the
activities that it is currently engaged in and (2) the entity’s governing documents and contractual arrangements allow additional
equity investments.
The amendments in this Update also eliminate an exception provided
to development stage entities in Topic 810, Consolidation, for determining whether an entity is a variable interest entity on the
basis of the amount of investment equity that is at risk. The amendments to eliminate that exception simplify U.S. GAAP by reducing
avoidable complexity in existing accounting literature and improve the relevance of information provided to financial statement
users by requiring the application of the same consolidation guidance by all reporting entities. The elimination of the exception
may change the consolidation analysis, consolidation decision, and disclosure requirements for a reporting entity that has an interest
in an entity in the development stage.
The amendments related to the elimination of inception-to-date information
and the other remaining disclosure requirements of Topic 915 should be applied retrospectively except for the clarification to
Topic 275, which shall be applied prospectively. For public business entities, those amendments are effective for annual reporting
periods beginning after December 15, 2014, and interim periods therein.
Early application of each of the amendments is permitted for any
annual reporting period or interim period for which the entity’s financial statements have not yet been issued (public business
entities) or made available for issuance (other entities). Upon adoption, entities will no longer present or disclose any information
required by Topic 915.
In June 2014, the FASB issued the FASB Accounting Standards Update
No. 2014-12 “
Compensation—Stock Compensation (Topic 718)
:
Accounting for Share-Based Payments When the Terms
of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period” (“ASU 2014-12”).
The amendments clarify the proper method of accounting for share-based
payments when the terms of an award provide that a performance target could be achieved after the requisite service period.
The Update requires that a performance target that affects vesting and that could be achieved after the requisite service period
be treated as a performance condition. The performance target should not be reflected in estimating the grant-date fair value of
the award. Compensation cost should be recognized in the period in which it becomes probable that the performance target will be
achieved and should represent the compensation cost attributable to the period(s) for which the requisite service has already been
rendered.
The amendments in this Update are effective for annual periods and
interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted.
In August 2014, the FASB issued the FASB Accounting Standards Update
No. 2014-15
“Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about
an Entity’s Ability to Continue as a Going Concern (“ASU 2014-15”).
In connection with preparing financial statements for each annual
and interim reporting period, an entity’s management should evaluate whether there are conditions or events, considered in
the aggregate, that raise substantial doubt about the entity’s ability to continue as a going concern within one year after
the date that the
financial statements are issued
(or within one year after the date that the
financial statements are
available to be issued
when applicable). Management’s evaluation should be based on relevant conditions and events that
are known and reasonably knowable at the date that the
financial statements are issued
(or at the date that the
financial
statements are available to be issued
when applicable). Substantial doubt about an entity’s ability to continue as a
going concern exists when relevant conditions and events, considered in the aggregate, indicate that it is probable that the entity
will be unable to meet its obligations as they become due within one year after the date that the financial statements are issued
(or available to be issued). The term
probable
is used consistently with its use in Topic 450, Contingencies.
When management identifies conditions or events that raise substantial
doubt about an entity’s ability to continue as a going concern, management should consider whether its plans that are intended
to mitigate those relevant conditions or events will alleviate the substantial doubt. The mitigating effect of management’s
plans should be considered only to the extent that (1) it is probable that the plans will be effectively implemented and, if so,
(2) it is probable that the plans will mitigate the conditions or events that raise substantial doubt about the entity’s
ability to continue as a going concern.
If conditions or events raise substantial doubt about an entity’s
ability to continue as a going concern, but the substantial doubt is alleviated as a result of consideration of management’s
plans, the entity should disclose information that enables users of the financial statements to understand all of the following
(or refer to similar information disclosed elsewhere in the footnotes):
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a.
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Principal conditions or events that raised substantial doubt about the entity’s ability to continue as a going concern
(before consideration of management’s plans)
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b.
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Management’s evaluation of the significance of those conditions or events in relation to the entity’s ability to
meet its obligations
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c.
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Management’s plans that alleviated substantial doubt about the entity’s ability to continue as a going concern.
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If conditions or events raise substantial doubt about an entity’s
ability to continue as a going concern, and substantial doubt is not alleviated after consideration of management’s plans,
an entity should include a statement in the footnotes indicating that there is
substantial doubt about the entity’s ability
to continue as a going concern
within one year after the date that the financial statements are issued (or available to be
issued). Additionally, the entity should disclose information that enables users of the financial statements to understand all
of the following:
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a.
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Principal conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern
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b.
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Management’s evaluation of the significance of those conditions or events in relation to the entity’s ability to
meet its obligations
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c.
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Management’s plans that are intended to mitigate the conditions or events that raise substantial doubt about the entity’s
ability to continue as a going concern.
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The amendments in this Update are effective for the annual period
ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted.
Management does not believe that any recently issued, but not yet
effective accounting pronouncements, when adopted, will have a material effect on the accompanying financial statements.
Note 3 – Going Concern
The Company has elected to adopt early application of Accounting
Standards Update No. 2014-15,
“Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure
of Uncertainties about an Entity’s Ability to Continue as a Going Concern (“ASU 2014-15”)
.
The Company's consolidated financial statements have been prepared
assuming that it will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation
of liabilities in the normal course of business.
As reflected in the consolidated financial statements, the Company
had an accumulated deficit at September 30, 2016, a net loss and net cash used in operating activities for the reporting period
then ended. These factors raise substantial doubt about the Company’s ability to continue as a going concern.
The Company is attempting to commence operations and generate sufficient
revenue; however, the Company’s cash position may not be sufficient to support its daily operations. While the Company believes
in the viability of its strategy to commence operations and generate sufficient revenue and in its ability to raise additional
funds, there can be no assurances to that effect. The ability of the Company to continue as a going concern is dependent upon its
ability to further implement its business plan and generate sufficient revenue and its ability to raise additional funds by way
of a public or private offering.
The financial statements do not include any adjustments related
to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might
be necessary should the Company be unable to continue as a going concern.
Note 4 – Related
Party Transactions (Restated)
Related Parties
Related parties with whom the Company had transactions are:
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Related Parties
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Relationship
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Mr. Chin Yung Kong
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Chairman, CEO, significant stockholder and director
before March 8, 2015
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The Company returned $319 to Mr. Chin Yung Kong during the nine
months ended September 30, 2016.
Mr. Chin Yung Kong paid $14,565 on behalf of the Company for the
expense during the nine months ended September 30, 2015.
Free Office Space
The Company has been provided office space by its Chief Executive
Officer at no cost. Management determined that such cost is nominal and did not recognize the rent expense in its financial statement.
Note 5 – Subsequent
Events
The Company has determined
that there were no subsequent events up to and including the date of the issuance of these financial statements that warrant disclosure
or recognition in the financial statements.
FORWARD LOOKING STATEMENTS
Statements made in this Form 10-Q that are
not historical or current facts are "forward-looking statements" made pursuant to the safe harbor provisions of Section
27A of the Securities Act of 1933 (the "Act") and Section 21E of the Securities Exchange Act of 1934. 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.