Notes to Financial Statements
For the Years Ended July 31, 2020 and 2019
NOTE 1 - ORGANIZATION AND OPERATIONS:
Peregrine Industries, Inc. (the
"Company") was formed on October 1, 1995 for the purpose of manufacturing residential pool heaters. The Company was formerly
located in Deerfield Beach, Florida. Products were primarily sold throughout the United States, Canada, and Brazil. In June 2002,
the Registrant and its subsidiaries filed a petition for bankruptcy in the U.S. Bankruptcy Court for the Southern District of Florida.
At present, the Company has no business operations and is deemed to be a shell company. The Company had a change in control on
July 8, 2013 as a result of the sale by our former principal shareholders, Richard Rubin, Thomas J. Craft, Jr. and Ivo Heiden,
of their 324,000 shares of common stock, representing approximately 61.8% of the Company's outstanding common stock, to Dolomite
Industries Ltd ("Dolomite"). In connection with the private sale of their shares of common stock to Dolomite on July
2, 2013, Messrs. Rubin and Heiden agreed to waive a total of $224,196 in liabilities owed to them at June 30, 2013. In connection
with the change of control transaction, two former principal shareholders transferred and assigned all $195,000 of their two convertible
notes to three unaffiliated third parties and one affiliated party. See also note 3. On June 12, 2017, the Board of Directors of
the Registrant appointed Mr. Zohar Shpitz as Chief Financial Officer (CFO) of the Registrant. Mr. Shpitz was appointed as CFO in
connection with the resignation of Mr. Ofer Naveh as the Registrant's CFO, effective June 19, 2017. On July 21, 2017, new management
acquired, 22,477,843 or 97.7% of the issued common restricted shares. The new management is developing a business plan which they
anticipate implementing within the current fiscal year.
NOTE 2 - BASIS OF PRESENTATION
AND SIGNIFICANT ACCOUNTING POLICIES:
Basis of Presentation
The financial statements of the
Company have been prepared in accordance with generally accepted accounting principles in the United States of America ("US
GAAP").
On December 1, 2017,
the Board of Directors of Peregrine Industries (the “Company”) approved a change in the fiscal year end from June 30,
to July 31, effective beginning with fiscal year commencing on July 1, 2019. The Company expects to make the fiscal year change
on a prospective basis and will not adjust operating results for previous periods. However, the change will impact the prior year
comparability of each of the fiscal quarters and annual period in 2020 in future filings. The Company believes this change will
provide benefits, including aligning its reporting periods to be consistent with an intended merger with an operating company.
Use of Estimates:
The preparation of financial statements
in conformity with US GAAP requires management to make estimates and assumptions that affect reported amounts of assets and liabilities
and disclosure of contingent assets and liabilities at the date of the financial statement and the reported amounts of revenues
and expenses during the reporting period. Actual results could differ from the estimates.
Earnings (loss) per share:
Basic loss per share is
computed using the weighted average number of common shares outstanding during the period. Diluted net loss per common share
is computed using the weighted average number of common and dilutive equivalent shares outstanding during the period.
Dilutive common equivalent shares consist of options to purchase common stock (only if those options are exercisable and at
prices below the average share price for the period) and shares issuable upon the conversion of issued and outstanding
preferred stock. Due to the net losses reported, dilutive common equivalent shares were excluded from the computation of
diluted loss per share, as inclusion would be anti-dilutive for the periods presented. There were no common equivalent shares
required to be added to the basic weighted average shares outstanding to arrive at diluted weighted average shares
outstanding as of July 31, 2020 and 2019.
PEREGRINE INDUSTRIES, INC.
Notes to Financial Statements
For the Years Ended July 31, 2020 and 2019
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.
Related Party Transactions
We consider all directors, officers
and those who own more than 5% shares to be related parties and record any transactions between them and the Company to be related
party transactions and disclose such transactions on notes to the financial statements.
Income taxes
The Company follows ASC Topic
740 for recording the provision for income taxes. Deferred tax assets and liabilities are computed based upon the difference between
the financial statement and income tax basis of assets and liabilities using the enacted marginal tax rate applicable when the
related asset or liability is expected to be realized or settled. Deferred income tax expenses or benefits are based on the changes
in the asset or liability each period. If available evidence suggests that it is more likely than not that some portion or all
of the deferred tax assets will not be realized, a valuation allowance is required to reduce the deferred tax assets to the amount
that is more likely than not to be realized. Future changes in such valuation allowance are included in the provision for deferred
income taxes in the period of change.
Deferred income taxes may arise
from temporary differences resulting from income and expense items reported for financial accounting and tax purposes in different
periods. Deferred taxes are classified as current or non-current, depending on the classification of assets and liabilities to
which they relate. Deferred taxes arising from temporary differences that are not related to an asset or liability are classified
as current or non-current depending on the periods in which the temporary differences are expected to reverse.
The Company applies a more-likely-than-not
recognition threshold for all tax uncertainties. ASC Topic 740 only allows the recognition of those tax benefits that have a greater
than fifty percent likelihood of being sustained upon examination by the taxing authorities. As of July 31, 2020, the Company reviewed
its tax positions and determined there were no outstanding, or retroactive tax positions with less than a 50% likelihood of being
sustained upon examination by the taxing authorities, therefore this standard has not had a material effect on the Company.
The Company does not anticipate
any significant changes to its total unrecognized tax benefits within the next 12 months.
The Company classifies tax-related penalties and net
interest as income tax expense. As of July 31, 2020, no income tax expense has been incurred.
NOTE 3 – GOING CONCERN:
The Company's financial
statements have been prepared on a going concern basis, which contemplates the realization of assets and settlement of
liabilities and commitments in the normal course of business for the foreseeable future. The Company has accumulated losses
aggregating $652,860 as of July 31, 2020 and $638,763 as of July 31, 2019 and has insufficient working capital to meet
operating needs for the next twelve months, all of which raise substantial doubt about the Company's ability to continue as a
going concern.
The financial statements do not
include any adjustment relating to the recoverability and classification of liabilities that might be necessary should the Company
be unable to continue as a going concern.
PEREGRINE INDUSTRIES, INC.
Notes to Financial Statements
For the Years Ended July 31, 2020 and 2019
The Company is taking appropriate
action to provide the necessary capital to continue its operations. These steps include, but are not limited to: 1) implementation
of new business plan 2) focus on sales to minimize the need for capital at this stage; 3) raising equity financing; 4) continuous
focus on reductions in cost where possible.
NOTE 4 – RELATED PARTY
TRANSACTIONS:
During the year ended July 31, 2020
Mace Corporation paid a total $14,097 directly to service providers compared to $20,092 for the year ended July 31, 2019. The advances
are unsecured, non-interest bearing and do not have stated repayment terms. Total advances though July 31, 2020 total $54,176.
NOTE 5 – STOCKHOLDERS’
DEFICIT:
Common Stock
The articles of incorporation authorize
the issuance of 100,000,000 shares of common stock, par value $0.0001. All issued shares of common stock are entitled to one vote
per share of common stock. The total outstanding on July 31, 2020 was 23,002,043;
Preferred Stock
The articles of incorporation authorize
the issuance of 5,000,000 shares of preferred stock with a par value of $0.0001 per share. None are issued.
PEREGRINE INDUSTRIES, INC.
Notes to Financial Statements
For the Years Ended July 31, 2020 and 2019
NOTE 6 – RECONCILIATION
OF BALANCE SHEETS BETWEEN JUNE 30, 2019 AND JULY 31, 2019:
|
|
July 31
|
|
June 30
|
|
|
2019
|
|
2019
|
Current assets
|
|
|
|
|
|
|
|
|
Bank
|
|
$
|
3,000
|
|
|
$
|
3,000
|
|
Total current assets
|
|
|
3,000
|
|
|
|
3,000
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
$
|
3,000
|
|
|
$
|
3,000
|
|
|
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
|
|
|
|
Loan - related party
|
|
$
|
40,079
|
|
|
$
|
40,029
|
|
Total current liabilities
|
|
|
40,079
|
|
|
|
40,029
|
|
|
|
|
|
|
|
|
|
|
Commitments and contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders' deficit
|
|
|
|
|
|
|
|
|
Preferred stock, $0.0001 par value; 5,000,000 authorized;
|
|
|
|
|
|
|
|
|
none issued and outstanding as of April 30, 2020 and July 31, 2019
|
|
|
—
|
|
|
|
—
|
|
Common stock, $0.0001 par value; 100,000,000 authorized; 23,002,043;
|
|
|
|
|
|
|
|
|
issued and outstanding as of April 30, 2020 and July 31, 2019, respectively
|
|
|
2,300
|
|
|
|
2,300
|
|
Additional paid-in capital
|
|
|
599,384
|
|
|
|
599,384
|
|
Accumulated deficit
|
|
|
(638,763
|
)
|
|
|
(638,713
|
)
|
Total stockholders' deficit
|
|
|
(37,079
|
)
|
|
|
(37,029
|
)
|
|
|
|
|
|
|
|
|
|
Total liabilities and stockholders' deficit
|
|
$
|
3,000
|
|
|
$
|
3,000
|
|
PEREGRINE INDUSTRIES, INC.
Notes to Financial Statements
For the Years Ended July 31, 2020 and 2019
NOTE 7 – INCOME TAX:
Of the total net operating
loss carryover of $84,080, $20,042 incurred during the year ended June 30, 2019 will expire in 2039. Due to the change in ownership
provisions of the Tax Reform Act of 1986, net operating loss carry forward for Federal income tax reporting purposes are subject
to annual limitations. Should a change in ownership occur, net operating
loss carry forward may be limited as to its use in future years.
The cumulative tax effect at
the expected rate of 21% of significant items comprising our net deferred tax amount is as follows:
|
|
July 31
|
|
|
2020
|
|
2019
|
|
|
|
|
|
Deferred
tax benefit
|
|
$
|
20,628
|
|
|
$
|
17,657
|
|
Valuation
allowance
|
|
|
(20,628
|
)
|
|
|
(17,657
|
)
|
NOTE 8 – SUBSEQUENT EVENTS:
Subsequent to July 31, 2020 and
through the date when this report was completed, the Company has evaluated subsequent events through the date the financial statements
were issued and has not identified any reportable events.