NOTES
TO CONDENSED FINANCIAL STATEMENTS
May
31, 2019
(UNAUDITED)
1.
|
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
|
Organization
Empire
Post Media, Inc. (the “Company”) was founded in the State of Nevada on October 13, 2009 and has an office location
in Las Vegas, Nevada. The Company was previously in the business of providing post-production services to the movie and television
industry. The Company ceased operations and has been inactive since 2012. The Company was a publicly-traded company listed on
the OTC Bulletin Board (“pink-sheets”). The last filing that the Company made with the SEC was its Form 10-Q for the
quarter ended August 31, 2012. Even though the Company has not made any further filings with the SEC since 2012, the Company has
continued to have some minimal stock trading activity. The Company filed a Form 10 registration statement with the SEC, which
was declared effective on September 10, 2018. The company is subject to the reporting requirements as set forth in the Securities
Exchange Act of 1934, as amended.
The
Company’s board is now considering merging with another entity that has viable operations. As such, the existing company
is not going to continue as a going concern after any merger. These financial statements do not contain any adjustments that would
be necessary should the Company not continue as a going concern. There is no assurance that the Company will be successful in
negotiating or closing a merger or acquisition with an operating company.
The
unaudited condensed financial statements of the Company have been prepared in accordance with the Securities and Exchange Commission
(SEC) rules for interim financial information. Accordingly, they do not include all the information and footnotes required by
accounting principles generally accepted in the United States of America for annual financial statements. However, the information
included in these interim financial statements reflects all adjustments (consisting solely of normal recurring adjustments) which
are, in the opinion of management, necessary for the fair presentation of the financial position and the results of operations.
Results shown for interim periods are not necessarily indicative of the results to be obtained for a full year. The balance sheet
information as of November 30, 2018 was derived from the audited financial statements which are included in the Form 10. These
interim financial statements should be read in conjunction with that report.
Going
Concern
The
Company has not generated revenues and has recognized net operating losses since its inception. The Company also has no working
capital and accumulated deficit at May 31, 2019. These factors among others raise substantial doubt about going concern. Furthermore,
as discussed above, the Company will not continue as a going concern in the event of a merger. The accompanying financial statements
have been prepared on a going concern basis of accounting, which contemplates continuity of operations, realization of assets
and liabilities and commitments in the normal course of business. The financial statements do not include any adjustments relating
to the recoverability of the carrying amount of the recorded assets or the amount of liabilities that might result from the outcome
of this uncertainty. The accompanying financial statements do not reflect any adjustments that might result if the Company is
unable to continue as a going concern. The Company’s ability to continue as a going concern and the appropriateness of using
the going concern basis is dependent upon, among other things, additional cash infusions. Management plans to raise additional
shareholder contributions in order to fund its operations. However, there can be no assurance that the Company will be able to
raise sufficient capital to continue with operations.
Cash
and Cash Equivalents
For
the purpose of the statement of cash flows, the Company considers cash equivalents to include cash and investments with an original
maturity of three months or less.
Income
Taxes
The
Company accounts for income taxes under the liability method in accordance with FASB ASC 740,
Income Taxes
. Under this
standard, deferred income tax liabilities and assets are determined based on the difference between the financial statement and
tax bases of assets and liabilities using the enacted tax rates expected to be in effect for the year in which the differences
are expected to reverse. Deferred income tax assets are reduced by a valuation allowance when the Company is unable to make the
determination that it is more likely than not that some portion or all of the deferred income tax asset will be realized. The
Company’s policy is to include interest and penalties related to unrecognized tax benefits in income tax expense. Interest
and penalties totaled $0 for the three months ended May 31, 2019 and 2018. The company files income tax returns with the Internal
Revenue Service (“IRS”) and various state jurisdictions. For jurisdictions in which tax filings are prepared, the
Company is subject to income tax examinations by state tax authorities and the IRS for tax years through 2012.
Deferred
Taxes
As
of May 31, 2019, total deferred income tax assets consist principally of net operating loss carry forwards in amounts still to
be determined. For financial reporting purposes, a valuation allowance has been recognized in an amount equal to such deferred
income tax assets due to the uncertainty surrounding their ultimate realization. If not utilize, the net operating loss carryover
is due to expire in 2030.
Earnings
(Loss) per Share
Basic
earnings per share are computed by dividing income available to common shareholders by the weighted-average number of common shares
outstanding. Diluted earnings per share is computed similar to basic earnings per share except that the denominator is increased
to include the number of additional common shares that would have been outstanding if the potential common shares had been issued
and if the additional common shares were dilutive. Common equivalent shares are excluded from the computation if their effect
is anti-dilutive.
Use
of Estimates
The
preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates
and assumptions that affect certain reported amounts and disclosures Management uses its knowledge of its business in making estimates.
Accordingly, actual results could differ from those estimates.
Fair
Value of Financial Instruments
Carrying
amounts reported in the balance sheet of accounts payable approximate fair value due to their short maturity.
Recently
Issued Accounting Pronouncements
Management
has assessed the recently issued accounting pronouncements and has determined that none of these pronouncements have an impact
on the Company’s financial statements.
2.
|
COMMITMENTS AND CONTINGENCIES
|
Judgment
Payable
On
April 3, 2014 the Company had a judgment assessed against them for $30,000. The judgment incurred interest at 10% per year. At
November 30, 2017, the balance on the judgment payable, including accrued interest, totaled $40,981. On May 22, 2018, the Company
agreed to settle this judgment payable totaling $42,403, including accrued interest, for $15,000. The Company’s shareholder
paid for this settlement directly, resulting in a contribution during the year ended November 30, 2018, and a gain on settlement
of $27,403. The Company also settled certain of its liabilities with its service providers, which resulted in a gai of $43,565.
The settlement amount of $46,635 was paid by the majority shareholder, thus was recorded as a capital contribution.
Legal
Matters
From
time to time the Company may be involved in certain legal actions and claims arising in the ordinary course of business. The Company
was not a party to any specific legal actions or claims at May 31, 2019
Cancellation
of Shares
During
the year ended November 30, 2018, the Company and a consultant/shareholder agreed to cancel 12 million shares held by this consultant
for non-performance of services.
Forgiveness
of Debt
During
the year, the majority shareholder paid $46,635 on behalf of the Company in order to settle liabilities. The majority shareholder
also forgave his accrued compensation totaling $18,500, which is recorded as a capital contribution.
3.
RESTATEMENT
The
balance sheet at November 30, 2018 is being restated to present liabilities paid by a shareholder that was not previously included,
and to adjust the par value of the common stock.
3.
|
RESTATEMENT (Continued)
|
The following table summarizes changes made to the balance sheet at November 30, 2018:
|
|
Previously Reported
|
|
|
|
|
|
Restated
|
|
|
|
November 30, 2018
|
|
|
Adjustments
|
|
|
November 30, 2018
|
|
ASSETS
|
CURRENT ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
|
|
|
100
|
|
|
|
-
|
|
|
|
100
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL CURRENT ASSETS
|
|
|
100
|
|
|
|
-
|
|
|
|
100
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL ASSETS
|
|
$
|
100
|
|
|
$
|
-
|
|
|
$
|
100
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY (DEFICIT)
|
|
|
|
|
|
|
|
|
|
|
|
|
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CURRENT LIABILITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts payable
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
Accrued compensation officer
|
|
|
|
|
|
|
|
|
|
|
|
|
Judgment payable
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL CURRENT LIABILITIES
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
COMMITMENTS AND CONTINGENCIES, note 2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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|
|
|
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SHAREHOLDERS’ EQUITY (DEFICIT)
|
|
|
|
|
|
|
|
|
|
|
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|
Preferred stock, $0.001 par value, 10,000,000 shares authorized, 0 shares issued and outstanding
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
Common stock, $0.001 par value, 400,000,000 shares authorized, 195,837,336 shares issued and outstanding
|
|
|
39,105
|
|
|
|
156,732
|
|
|
|
195,837
|
|
Additional paid-in capital
|
|
|
134,745
|
|
|
|
(131,097
|
)
|
|
|
3,648
|
|
Accumulated deficit
|
|
|
(173,750
|
)
|
|
|
(25,635
|
)
|
|
|
(199,385
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL SHAREHOLDERS’ EQUITY (DEFICIT)
|
|
|
100
|
|
|
|
-
|
|
|
|
100
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
$
|
100
|
|
|
$
|
-
|
|
|
$
|
100
|
|
3.
|
RESTATEMENT
(Continued)
|
The
November 30, 2018 statement of operations are being restated to recognize the expenses paid by shareholder during the year ended
November 30, 2018 and correcting the gain on extinguishment of liabilities during the year ended November 30, 2018.
The
following table summarizes changes made to the year ended November 30, 2018 Statement of Operations:
|
|
Previously Reported
|
|
|
Adjustments
|
|
|
Restated
|
|
|
|
|
|
|
|
|
|
|
|
REVENUES
|
|
$
|
-
|
|
|
$
|
-
|
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING EXPENSES
|
|
|
|
|
|
|
|
|
|
|
|
|
General and administrative
|
|
|
1,647
|
|
|
|
19,038
|
|
|
|
20,685
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL OPERATING EXPENSES
|
|
|
1,647
|
|
|
|
19,038
|
|
|
|
20,685
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER INCOME
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest Expense
|
|
|
-
|
|
|
|
1,422
|
|
|
|
1,422
|
|
Gain on settlement of liabilities
|
|
|
76,143
|
|
|
|
(5,175
|
)
|
|
|
70,968
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME (LOSS) BEFORE PROVISION OF INCOME TAXES
|
|
|
74,496
|
|
|
|
(25,635
|
)
|
|
|
48,861
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PROVISION FOR INCOME TAXES
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME (LOSS)
|
|
$
|
74,496
|
|
|
$
|
(25,635
|
)
|
|
$
|
48,861
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted income (loss) per share
|
|
$
|
0.00
|
|
|
$
|
-
|
|
|
$
|
0.00
|
|
On
May 31, 2019, Peter Dunn, the sole officer, director and controlling shareholder of the Company sold 126,855,000 shares of Common
Stock to Saean, Inc, a Nevada corporation, which represented controlling interest in the Company. On this same date, Peter Dunn
resigned as sole officer and dire tor of the Company and named the following individuals as the new officers and directors of
the Company: Jun Y Lee (President and Director), Ted Campbell (Secretary), and William Sawyer (treasurer).