Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-K/A

 

(Mark One)
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended January 31, 2019
or
TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from [   ] to [   ]
   
Commission file number 333-182130
     

AVRA INC.
(Exact name of registrant as specified in its charter)

     
Nevada   36-4789798
(State or other jurisdiction of incorporation or organization)   (I.R.S. Employer Identification No.)

     
One Glenlake Pkwy., #650, Atlanta, GA   30328
(Address of principal executive offices)   (Zip Code)
Registrant's telephone number, including area code:   1-855-290-3195

 

Plaza Compostela 4D2, Av. John F Kennedy, Ensanche Paraiso, Santo Domingo, Dominican Republic, 10126,

Former name, former address and formal fiscal year, if changed since last report

 

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of Each Class   Name of Each Exchange On Which Registered
N/A   N/A

 

Securities registered pursuant to Section 12(g) of the Act:

             
Common Stock, par value $0.00001
(Title of class)
 
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 the Securities Act. 
  Yes   No 
   
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act
  Yes   No 
   
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the last 90 days. 
  Yes X  No 
   
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
    Yes   No   
       
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter)  is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.
 
   

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 
Large accelerated filer   Accelerated filer  
Non-accelerated filer Smaller reporting company  
Emerging growth company      
         
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the exchange act.
   
 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  
  Yes   No 

 

Indicate the number of shares outstanding of each of the registrant’s classes of common stock as of the latest practicable date. There are 63,397,094 common shares issued and outstanding as of May 20, 2019.

 

DOCUMENTS INCORPORATED BY REFERENCE

 

None.

 

 

 

     

 

 

Table of Contents

 

Part I Page
Item 1. Business 1
Item 1A. Risk Factors 8
Item 1B. Unresolved Staff Comments 8
Item 2. Properties 8
Item 3. Legal Proceedings 8
Item 4. Mine Safety Disclosures 8
     
Part II    
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 9
Item 6. Selected Financial Data 9
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 10
Item 7A. Quantitative and Qualitative Disclosures About Market Risk 14
Item 8. Financial Statements and Supplementary Data 15
Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure 16
Item 9A. Controls and Procedures 16
Item 9B. Other Information 16
     
Part III    
Item 10. Directors, Executive Officers and Corporate Governance 17
Item 11. Executive Compensation 20
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 21
Item 13. Certain Relationships and Related Transactions, and Director Independence 22
Item 14. Principal Accounting Fees and Services 22
     
Part IV    
Item 15. Exhibits, Financial Statement Schedules 24

 

 

 

 

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PART I

 

Item 1.           Business

 

Introduction of Bitcoin

 

Since its inception in 2009, Bitcoin as the leading virtual or digital currency has grown substantially, with many other different currencies appearing since 2011. Bitcoin is a consensus network that enables a new payment system and a completely digital form of money. It is the first decentralized peer-to-peer payment network that is powered by its users with no central authority or middlemen. From a user perspective, Bitcoin is pretty much like cash for the Internet. Bitcoin can also be seen as the most prominent triple entry bookkeeping system in existence.

 

From a user perspective, Bitcoin is nothing more than a mobile app or computer program that provides a personal Bitcoin wallet and allows a user to send and receive bitcoins with them. This is how Bitcoin works for most users.

 

Behind the scenes, the Bitcoin network is sharing a public ledger called the "block chain". This ledger contains every transaction ever processed, allowing a user's computer to verify the validity of each transaction. The authenticity of each transaction is protected by digital signatures corresponding to the sending addresses, allowing all users to have full control over sending bitcoins from their own Bitcoin addresses. In addition, anyone can process transactions using the computing power of specialized hardware and earn a reward in bitcoins for this service. This is often called "mining". 

 

There is a growing number of businesses and individuals using Bitcoin. This includes brick and mortar businesses like restaurants, apartments, law firms, and popular online services such as Expedia, Microsoft, Dell, NewEgg, WordPress, and Overstock. While Bitcoin remains a relatively new phenomenon, it is growing fast. In April 2015, the value of all bitcoins in circulation exceeded US$3 billion with tens of millions of dollars’ worth of bitcoins exchanged daily.

 

Bitcoin payments are easier to make than debit or credit card purchases, and can be received without a merchant account. Payments are made from a wallet application, either on your computer or smartphone, by entering the recipient's address, the payment amount, and pressing send. To make it easier to enter a recipient's address, many wallets can obtain the address by scanning a QR code or touching two phones together with NFC technology.

 

Advantages of Bitcoin

 

Payment freedom - It is possible to send and receive any amount of money instantly anywhere in the world at any time. No bank holidays. No borders. No imposed limits. Bitcoin allows its users to be in full control of their money.

 

Very low fees - Bitcoin payments are currently processed with either no fees or extremely small fees. Users may include fees with transactions to receive priority processing, which results in faster confirmation of transactions by the network.

 

Additionally, merchant processors exist to assist merchants in processing transactions, converting bitcoins to fiat currency and depositing funds directly into merchants' bank accounts daily. As these services are based on Bitcoin, they can be offered for much lower fees than with PayPal or credit card networks.

 

Fewer risks for merchants - Bitcoin transactions are secure, irreversible, and do not contain customers’ sensitive or personal information. This protects merchants from losses caused by fraud or fraudulent chargebacks, and there is no need for PCI compliance.

 

Merchants can easily expand to new markets where either credit cards are not available or fraud rates are unacceptably high. The net results are lower fees, larger markets, and fewer administrative costs.

 

 

 

 

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Security and control - Bitcoin users are in full control of their transactions; it is impossible for merchants to force unwanted or unnoticed charges as can happen with other payment methods. Bitcoin payments can be made without personal information tied to the transaction. This offers strong protection against identity theft. Bitcoin users can also protect their money with backup and encryption.

 

Transparent and neutral - All information concerning the Bitcoin money supply itself is readily available on the block chain for anybody to verify and use in real-time. No individual or organization can control or manipulate the Bitcoin protocol because it is cryptographically secure. This allows the core of Bitcoin to be trusted for being completely neutral, transparent and predictable.

 

Our Products and Services

 

Avra is focused in providing services to both consumers and businesses in this sector, providing access to the technology in a simple way. The Company’s business model can be broken down into four distinct categories, as follows:

 

AvraPay – is the Company’s cryptocurrency payment solution. It plans to offer the technology in order for merchants to accept digital payments in their businesses, with AvraPay being the payment processor. The business is expected to be able to accept payments online or in person through the AvraPay technology and be paid in government declared legal tender or better known as FIAT or cryptocurrency depending on the businesses preference. Avra plans to charge a percentage of the transaction in the same way as a credit card provider.

 

AvraATM – is another technology solution planned by the Company is called AvraATM, which it plans to develop a software to be integrated with kiosks which will allow the kiosk to have the ability to accept payments, effectively converting the existing kiosk into a purchase point (ATM) for bitcoin and other cryptocurrencies. The planned revenue model is one where a percentage fee will be charged for the purchase of currency, which will vary depending on the expectations of the individual owners of each kiosk network.

 

AvraTravel – is where the Company plans on offering a tailored version of AvraPay to international holiday destinations, focused on tourism, such as hotels, casinos, airlines, restaurants, bars, and spas. These tailored solutions will enable businesses to be fully mobile and yet charge clients instantly to their digital wallets. Avra also intends to run a buy-back scheme intended for digital currency where departing tourists will be able to exchange through a partner, their remaining unused local currency and take home digital currency.

 

AvraSecure – delivers a full range of server security, hosting and management services that provide fully-managed and co-managed security solutions to meet the security and infrastructure needs of organizations. The company security specialists work with clients to create a secure compliant environment for critical infrastructure. Also working with customers to pass compliance audits by coordinating directly with auditors and providing comprehensive documentation.

 

AvraNews – in addition to Avra’s website, the Company is developing its own news portal, which will provide up to the minute news and analysis on the cryptocurrency industry. This business area will be supported by funneling business to Avra’s own business solutions, in addition to paid advertising and affiliate schemes. There will also be a section to connect investors and start-ups companies, which at some point in the future will be monetized through a subscription system.

 

Avra owns the following domains avraglobal.com, avraworld.com, avrainc.com, avraonline.com, avratip.com, avrapro.com, avrabit.com, avracoin.com.

 

 

 

 

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AvraPay Features

 

AvraPay can be accessed through any web enabled device. Businesses and clients alike will be able to send and receive payments with only a mobile signal for their phone. Businesses will be able to send invoices directly from the AvraPay portal to clients via email also, with instant confirmations of payments in the portal and also via email. The AvraPay platform can also be accessed through SMS should the user not have access to the internet where users and businesses can also send and receive money by simply sending text messages.

 

The AvraPay Portal will be the central point of the system, where users can see their history, balances, generate invoices, add and withdraw funds and manage their AvraPay account including any other wallet addresses that they may have.

 

AvraPay receives commissions over payments sent and received to and from the client’s wallet when changing to local currency as well as transaction revenue depending on the type of transaction realized by the client.

 

Businesses can opt for their AvraPay account to be linked to their bank account to enable instant conversion of digital currency to cash at the moment of transaction to remove their exposure to the fluctuations in the digital currency exchange markets. The business will receive normally within 1 business day the funds directly to their company account.

 

The company owns the domains avrapay.com, avrapay.com.do, and avra.do for this business.

 

AvraATM Features

 

AvraATM will operate under two different models however both dedicated to provision of the same service, which is to allow clients access to digital currency through automated teller machines, simply by inserting local currency.

 

Our partner program will work with existing kiosk/terminal operators to provide the services in order to purchase and sell digital assets through the terminals. The terminals will work with the Avra API to confirm transactions and interact with the relevant digital currency wallets of the client. The client can insert cash, and on confirmation of the transaction by the terminal relevant digital currency funds will be provided to the client within a few seconds. To withdraw local currency from an enabled machine, the client will send funds to the terminal from their mobile device and once the transaction is confirmed, the monies will be released by the machine.

 

Avra will also be purchasing, branding, installing and running its own kiosks. The kiosks will be branded Avra, and will provide all the payment services of the local market where it is installed, as well as the digital currency transactions mentioned.

 

These machines will provide visibility for Avra, but also will provide good income streams from the ancillary transactions that the terminals are able to provide such as electric, water, gas, taxes, mobile phone recharges etc. These terminals will also be distributed under out AvraTravel strategy in key locations in hotel receptions, high traffic areas and airports.

 

Avra owns the domain avraatm.com for this line of business.

 

AvraTravel Features

 

AvraTravel is a combination of the Payment and ATM solutions to be introducted into destination specific markets. Avra is focused initially on the primary vacation destinations in the Americas and the Caribbean, offering to hotels, casinos, tour operators, and other related businesses, the ability to transact with their clients in digital currencies.

 

 

 

 

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Clients will be able to recharge their bitcoin wallet from their bank account before leaving home and travel without the need to carry large amounts of cash or credit cards. In their chosen destination they will be able to safely and securely pay with just their mobile phone, without running the risk of theft of cash or credit card cloning. They will also be able to withdraw local cash for any needs from hotel receptions, ATM/kiosks and other Avra agents in the destinations. From hotels, stores, restaurants to taxis and watersports, AvraTravel can turn any business into a bitcoin friendly enterprise.

 

AvraSecure Features

 

AvraSecure delivers a full range of server security, hosting and management services that provide fully-managed and co-managed security solutions to meet the security and infrastructure needs of your organization. Our security specialists work with you to create a secure compliant environment for your critical infrastructure.

 

AvraSecure works with our customers to pass compliance audits by coordinating directly with auditors and providing comprehensive documentation. The combination of our proactive security approach, our expert team of security specialists and industry leading technologies make AvraSecure the obvious choice for organizations seeking to comply with industry regulations and increase overall security.

 

If your business accepts credit cards on-line, major credit card companies now require you to follow the rules found in the Payment Card Industry Data Security Standard (PCI DSS). PCI-DSS was developed by several of the major credit card companies as a guideline to help organizations that process credit card payments prevent credit card fraud, hacking and various other security vulnerabilities and threats. It is regarded as an industry-established policy and requires compliance by all merchants and service providers that store, process, or transmit card holder data, regardless of size.

 

Distribution and Marketing

 

Our initial efforts will be centered in developing our brand image. In order for this to happen effectively, we expect to engage in an aggressive advertising and marketing campaign before each product’s launch. From there we will try to expand our business through several methods. These methods include:

 

Trade Shows – A highly effective medium to help promote the brand of Avra Inc. as well as the Avra suite of products. It will be important for our company to effectively distinguish its system from every other Bitcoin company that exists in the market. Our company will hire top marketers in the industry to run its trade show marketing campaigns.

 

Digital Currency and Technology Blogs – It will be important for our company to get attention from top technology blogs and websites in the U.S. Such large blogs include Engadget.com, Gizmodo.com and Wired.com. The reviews and attention that these weblogs provide are key to the success of a lot of technology companies in the U.S. Casual readers as well as professionals in the community read these blogs on a daily basis to be informed on the latest news. This is an effective way of getting positive attention for our company. In addition, this is a free way of getting the message out.

 

Word of Mouth – Since it is imperative for our company to build a brand image, it will rely on word of mouth to help sustain its business. This will be kick started by effective advertising in other areas, such as TV advertising and Internet advertising. Later on people will tell their friends how great the Avra service is.

 

 

 

 

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Google Ads and Local Websites – We plan to advertise on the Internet on local websites, including Google Ads on popular local social and news websites. This is a highly effective method of obtaining younger and more internet-savvy customers.

 

Traditional Advertising - Advertising, such as on billboards, magazines, newspapers, and local television stations are an effective method of gaining customers of all demographics.

 

Search Engine Optimization Marketing - We plan on having a budget to market our brand and corporate identity on various search engines.

 

We plan to sell our Avra products through a number of distribution channels. These will include:

 

POS Operators – Most retailers employ a POS system in order to control the billing. Avra will work alongside these companies to offer both integrations within their systems to allow their clients additional payment methods in digital currency, as well as a generous commission schedule to motivate the POS providers to market the AvraPay product.

 

US ISO/MSP Distribution – Avra intends to develop distribution strategies to leverage existing card payment distribution networks to allow digital currency payments to take place alongside. As ISOs and MSPs have large existing networks of retailers using their service, Avra offers additional revenue streams to the company and more payment options to the retailer.

 

Direct Sales – Avra will be selling through outbound telephone campaigns directing clients to signups and dealing with paperwork through email and the web.

 

Internet Sales – We will depend largely on this method of sales as the products will be mainly targeted to Internet and technology savvy businesses. Our website is live but the Company is looking at updating its website presence in the near future to integrate online signups and instant identity verification.

 

Competition

 

The bitcoin industry is, although new, still highly competitive. We are a new development stage company and have a weak competitive position in the industry. We compete with junior and senior digital currency companies.

 

Many of the companies with which we compete for financing and for the acquisition of customers have greater financial and technical resources than those available to us. Accordingly, these competitors may be able to spend greater amounts on product development, marketing and distribution.

 

This advantage could enable our competitors to acquire larger market share and develop more competitive products. Such competition could adversely impact our ability to attain the financing necessary for us to develop our business plan. In the face of competition, we may not be successful in sufficient market share to make our business profitable. Despite this, we hope to compete successfully in the home electronics industry by:

 

keeping our costs low relying on the strength of our management’s passion and knowledge of the market; and using our size and experience to our advantage by adapting quickly to changing market conditions or responding swiftly to potential opportunities.

 

 

 

 

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Government Regulations

 

US Federal Level

 

The Financial Crimes Enforcement Network (“FinCEN”) is the bureau of the US Department of the Treasury that enforces federal regulation of money services businesses in the United States.

 

On March 18, 2013, FinCEN published guidance announcing that it would make no distinction between transmitters of government (or “fiat”) currency and transmitters of bitcoin, which it now famously referred to as a “decentralized convertible virtual currency”, rather than by name itself.

 

Thus, businesses that transmitted, sold or exchanged bitcoin were now Money Services Businesses, specifically “money transmitters”, required to register with FinCEN and satisfy ongoing record-keeping and reporting requirements.

 

Because money transmission is such a heavily regulated business, classification as a money transmitter – especially unwitting classification – comes with real legal and practical consequences.

 

FinCEN regulates money transmitters pursuant to a legislative framework commonly referred to as the Bank Secrecy Act (“BSA”), which includes elements of the Patriot Act and other pieces of legislation. The primary consequence of this regulation is that money transmitters must put in place and enforce Anti Money Laundering (“AML”) and Know Your Customer (“KYC”) policies designed to aid FinCEN’s investigation of potential criminal activity.

 

The specific AML and KYC requirements of the BSA could (and do!) fill pages. But in short strokes, businesses must collect personally identifying information about their customers, in some circumstances report that information to FinCEN, and sometimes even outright deny service.

 

Suspicious transactions - or even ministerial transactions over a certain dollar amount - must be reported to FinCEN. In effect, the BSA deputizes financial institutions, requiring them to act as the government's foot soldiers in its war on money laundering.

 

US State Level

 

However, just because the business is considered a money transmitter by the federal government does not necessarily mean it will be classified as such.

 

At minimum, we know that two states do not require money transmission licensure: South Carolina and Montana. A third, New Mexico, only regulates negotiable instruments, a category which, so far, has not been applied to bitcoin.

 

State regulatory bodies have offered little, if any, guidance to bitcoin businesses. In fact, the most helpful information they have provided is not bitcoin-specific at all. It has to do with a legal principal called “extraterritorial jurisdiction”: some state regulatory bodies have announced that any business servicing or soliciting its state’s citizens must satisfy that state’s licensing requirements, even if the business has no physical presence in that state. This is true whether the business is physically located in a different state, a foreign country, or is as a web service with no physical presence at all.

 

This principle has special applicability to bitcoin businesses.

 

Decentralized digital currency is, by design, a borderless medium of exchange. Most bitcoin businesses exist on the internet, where the state of its incorporation and the citizenship of its clientele are all but irrelevant.

 

 

 

 

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Environmental Regulations

 

We are not aware of any material violations of environmental permits, licenses or approvals that have been issued with respect to our operations. We expect to comply with all applicable laws, rules and regulations relating to our business, and at this time, we do not anticipate incurring any material capital expenditures to comply with any environmental regulations or other requirements.

 

While our intended projects and business activities do not currently violate any laws, any regulatory changes that impose additional restrictions or requirements on us or on our potential customers could adversely affect us by increasing our operating costs or decreasing demand for our products or services, which could have a material adverse effect on our results of operations.

 

Intellectual Property

 

We have not filed for any protection of our trademark, and we do not have any other intellectual property. We own the domains avraworld.com, avraglobal.com, avrapay.com, avrapay.com.do, avra.do, avraatm.com, avratravel.com, avratourism.com, avrasecure.com, avranews.com, avratip.com, avrapro.com, avrainc.com, avrabit.com, avracoin.com, avraonline.com.

 

Employees

 

We do not have any employees. Our CEO & Director is devoting approximately 40 hours per week to our affairs. We also engage a number of consultants.  

 

Recent Development

 

Change of Control

 

On November 26, 2014, David Bailey, the former majority shareholder of the Company, sold 35,333,333 shares of the Company to Stephen Shepherd, the Chief Executive Officer and Director of the Company, pursuant to a share purchase agreement. In lieu of payment, Mr. Bailey was granted the rights to market the Company’s intellectual properties in the Country of Jamaica within the next 12 months of the signing of the agreement. Mr. Bailey also agreed to waive all amounts owed to him as officer advances.

 

In connection with the share purchase agreement, Stephen Shepherd also entered into an assignment agreement with the Company to assign all his proprietary information related to bitcoin and cryptocurrencies to the Company.

   

As a result, Stephen Shepherd now owns an aggregate of 79,500,000 pre-reverse stock split shares of common stock, or 56.27% of our total voting power of all of our outstanding voting securities. 

 

Reverse Stock Split

 

On November 17, 2014, the Company filed a Certificate of Amendment to amend its Articles of Incorporation so that each two point two five (2.25) shares of common stock issued and outstanding shall, automatically and without any action on the part of the respective holders thereof, be combined and converted into one (1) share of common stock (the "Reverse Stock Split"). The Reverse Stock Split was approved by the majority shareholder holding 58.39% of then issued and outstanding common stock of the Company and by the board of directors through unanimous written consent on November 11, 2014.

 

 

 

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No fractional shares shall be issued in connection with the Reverse Stock Split. Stockholders who otherwise would be entitled to receive fractional shares of common stock shall be rounded up to the next whole share of common stock. We have obtained approval from Financial Industry Regulatory Authority regarding the Reverse Stock Split and the corporation action took effect on December 11, 2014.

 

Financing

 

On December 5, 2014, we closed a financing transaction by entering into a subscription agreement dated with a non-U.S. investor (the “Purchaser”) for aggregate investment proceeds of $150,000. Pursuant to the subscription agreement, we issued the following to the Purchaser: (i) 600,000 shares of the Company’s common stock at a purchase price of $0.25 per share, and (ii) a warrant to purchase an aggregate of 600,000 shares of the Company’s common stock, for an exercise price of $0.50 per share for a period of one year from the closing date. The securities were offered and sold without registration under the Securities Act of 1933 (the “Securities Act”) in reliance on the exemptions provided by Section 4(a)(2) of the Securities Act and/or Regulation S promulgated thereunder and in reliance on similar exemptions under applicable state laws.

 

Subsidiary

 

On January 4, 2015, the Company established a subsidiary AvraPay SRL under the laws of Dominican Republic, where Avra Inc. owns 99%, and Steve Shepherd owns 1% of the shares of AvraPay SRL.

 

Item 1A.        Risk Factors

 

As a “smaller reporting company”, we are not required to provide the information required by this Item.

 

Item 1B.        Unresolved Staff Comments

 

As a “smaller reporting company”, we are not required to provide the information required by this Item.

 

Item 2.           Properties

 

Item 3.           Legal Proceedings

 

We know of no material, existing or pending legal proceedings against us, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our company.

 

Item 4.           Mine Safety Disclosures

 

Not applicable.

 

 

 

 

 

 

 

 

 

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PART II

 

Item 5.           Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

 

Our shares of common stock are listed on the OTC- Pink Sheets under the trading symbol “AVRN”. The first trade of our stock was on April 23, 2013.

 

Over-the-counter market quotations reflect inter-dealer prices without retail mark-up, mark-down or commission, and may not represent actual transactions. The following table presents the high and low bid price for our common stock for the periods indicated:

 

Fiscal Quarter High Low
First Quarter (February 1, 2018– April 30, 2018) $0.045 $0.018
Second Quarter May 1, 2018– July 31, 2018) $0.030 $0.014
Third Quarter (August 1, 2018– October  31, 2018) $0.028 $0.010
Fourth Quarter (November 1, 2018– January 31, 2019) $0.016 $0.006

 

Holders

 

As of May 20, 2019, there were 30 holders of record of our common stock. As of such date, 63,397,094 shares of our common stock were issued and outstanding.

 

Dividend Policy

 

To date, we have not paid dividends on shares of our common stock and we do not expect to declare or pay dividends on shares of our common stock in the foreseeable future. The payment of any dividends will depend upon our future earnings, if any, our financial condition, and other factors deemed relevant by our board of directors.

 

Equity Compensation Plan Information

 

We do not have any equity compensation plans.

 

Recent Sales of Unregistered Securities; Use of Proceeds from Registered Securities

 

None.

 

Purchase of Equity Securities by the Issuer and Affiliated Purchasers

 

We did not purchase any of our shares of common stock or other securities during our fiscal year ended January 31, 2019.

 

Item 6.           Selected Financial Data

 

As a “smaller reporting company”, we are not required to provide the information required by this Item.

 

 

 

 

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Item 7.           Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

The following discussion should be read in conjunction with our audited financial statements and the related notes that appear elsewhere in this annual report. The discussions of results, causes and trends should not be construed to imply any conclusion that these results or trends will necessarily continue into the future.

 

Our audited financial statements are stated in United States Dollars and are prepared in accordance with United States Generally Accepted Accounting Principles.

 

Overview

 

We were incorporated on December 1, 2010 under the laws of the State of Nevada. Our principal executive offices are located at Plaza Compostela 4D2, Av. John F Kennedy, Ensanche Paraiso, Santo Domingo, Dominican Republic. Our telephone number is. Our fiscal year end is January 31.

 

The Company is focused on solutions in the cryptocurrency and digital currency markets, particularly in offering payment solutions to businesses worldwide.  The company also still maintains its business of marketing and distributing of Smart TV boxes to home consumers throughout the United States. Smart TV boxes are hardware devices that allow consumers to combine all of the benefits of the Internet with the large size and high definition capabilities of TV screens in the comfort of consumers’ living rooms. The Company’s new website has been launched and can be found at www.avraglobal.com.  The Company’s business model can be broken down into four distinct categories, as follows:

 

AvraPay – Is the Company’s cryptocurrency payment solution. It plans to offer the technology in order for merchants to accept digital payments in their businesses, with AvraPay being the payment processor. The business will be able to accept payments online or in person through the AvraPay technology and be paid in government declared legal tender or better known as FIAT or cryptocurrency depending on the businesses preference. Avra plans to charge a percentage of the transaction in the same way as a credit card provider.

 

AvraATM – Is another technology solution planned by the Company is called AvraATM, which it plans to develop a software to be integrated with kiosks which will allow the kiosk to have the ability to accept payments, effectively converting the existing kiosk into a purchase point (ATM) for bitcoin and other cryptocurrencies. The planned revenue model is one where a percentage fee will be charged for the purchase of currency which will vary depending on the expectations of the individual owners of each kiosk network.

 

AvraTourism – Is where the Company plans on offering a tailored version of AvraPay to international holiday destinations, focused on tourism, such as hotels, casinos, airlines, restaurants, bars, and spas.  In addition to offering a specific solution which is to “buy-back” unused local currency from departing tourists, and in exchange we intend to provide tourists  with digital currency to for them to use upon their return home through dedicated ATMs installed in key points such as airports.

 

AvraSecure – delivers a full range of server security, hosting and management services that provide fully-managed and co-managed security solutions to meet the security and infrastructure needs of organizations. The company security specialists work with clients to create a secure compliant environment for critical infrastructure. Also working with customers to pass compliance audits by coordinating directly with auditors and providing comprehensive documentation.

 

 

 

 

  10  

 

 

AvraNews – In addition to Avra’s website, the Company is developing its own news portal, which will provide up to the minute news and analysis on the cryptocurrency industry. The business will be supported by funneling business to Avra’s own business solutions, in addition to paid advertising and affiliate schemes. There will also be a section to connect investors and start-ups companies, which at some point in the future will be monetized through a subscription system.

 

To date the Company has been involved in initial discussions with other cryptocurrency providers in order to establish what the service proposition would be. In addition, the company has been involved in market research and has had initial discussions with potential clients to ensure that the services that will be provided are in demand and appropriately presented.

 

On December 8, 2014, the Company entered into a software and information technology agreement with T2M International Inc., a consulting company, who will provide information technology support, software development and integration, hosting services and solutions, marketing strategies, and digital currencies solution services in consideration for cash payments of $5,000 per month for a 6-month term ending May 1, 2015.

 

On December 22, 2014, the Company engaged Sightspan as compliance consultants to ensure that Avra Inc. will be operating compliantly in the markets in which it operates. Sightspan have provided OFAC/AML policies for both the US and Dominican Republic markets, being the first key markets that Avra will be working. In the US this will ensure that Avra is compliant with FinCen regulations as a money transmitter and the Company’s responsibilities regarding BSA reporting for money laundering. This also includes in-house training for all Company staff as regards the responsibilities of all parties and a comprehensive program of education to ensure that the policy is kept current.

 

Avra is developing the ATM project with a provider in Central America, which is a part of a larger group operating in over 20 countries worldwide which we hope to be the next stages of expansion of the project. The company has spoken with several large hotel chains, casinos and other tourism related businesses in the Caribbean’s largest tourist destination in Punta Cana and has established that many of these establishments could be interested in such a product subject to the terms that would be offered. The Company has also identified several other large tourist destinations throughout the Americas where the expectation is to expand the service offering over the next 12 months.

 

Plan of Operations

 

Avra’s planned operations over the next 12 months are as follows:

 

Avra’s next stages of operation will be to continue ensuring compliance with US and local authorities, maintaining monitoring practices, as well as the continued development of the company’s central system (API) where all the services will connect and operate from.

 

The Avra news portal is being developed, providing daily news events and analysis, products information and fund raising opportunities for startups in the space.

 

The Company is working on its first ATM client. The Company is in active discussions with several large hotel chains and looks to have these businesses actively using the system online and in-house. On completion of first phase and successful beta testing we intend to roll out the system at an accelerated rate through a network of sales agents working in strategic locations, a generous referral program, a strong social media presence as well as online advertising.

 

 

 

 

  11  

 

 

Once the established core businesses are operating and the sales process working, we intend to develop the product portfolio, working with remittance companies to allow remittances-by-bitcoin as well as regional bill-pay-by-bitcoin solutions, through portals that Avra will be developing further.

   

Operationally we expect to hire sales managers to oversee sales for each of the brands AvraPay and AvraATM.  We also plan to hire an in house technology person who would monitor and develop the API and provide service to existing and new clients. The timing of the requirement of people for these positions will be variable depending on workloads and whether we can continue to use consultants at a cheaper rate.

 

We expect to be in a full marketing phase, expecting to increase users, business, the ATM network, solidifying the brand and awareness as well as bringing the company to solid profit margins in order to expand further.

 

Beyond 2018 and with the user base expected, we would hope to reduce our dependence on other providers for exchange and services, and start to provide those services ourselves, thereby increasing margins and ensuring that Avra is completely independent of other providers. 

 

Results of Operations

 

Our operating expenses for the years ended January 31, 2019 and 2018 are summarized as follows:

 

    Year Ended     Year Ended  
    January 31,
2019
    January 31,
2018
 
General and Administrative
  $ 97,780     $ 90,906  
Gain on forgiveness of debt     (17,659 )     (21,632 )
Interest Expense     29,302       14,549  
                 
Net Loss   $ 109,423     $ 83,823  

 

Revenue

 

We have not generated any revenues since our inception.

 

General and Administrative

 

In the year ended January 31, 2019, we incurred net loss of $109,423 compared to $83,823 in the year ended January 31, 2018. Our net loss increased $25,600 from January 31, 2018 to January 31, 2019 primarily as a result of increase in consulting and professional fees and general and administrative fees incurred in the year ended January 31, 2019.

 

 

 

 

  12  

 

 

Liquidity and Capital Resources

  

Working Capital

 

    At     At  
    January 31,
2019
    January 31,
2018
 
Current assets   $     $  
Current liabilities     755,931       646,508  
                 
Working capital (deficit)   $ (755,931 )   $ (646,508 )

 

Our total current assets as of January 31, 2019 were $0 and as of January 31, 2018 were $0. Our total current liabilities as of January 31, 2019 were $755,931 as compared to total current liabilities of $646,508 as of January 31, 2018. The increase was primarily due to an increase Notes payable of $43,850 and an increase of $61,250 in related party payables, making a total related party payables of $221,031.

 

Cash Flows

 

    At     At  
    January 31,
2019
    January 31,
2018
 
Cash flows used in operating activities   $ (43,850 )   $ (40,000 )
Net cash used in investing activities            
Cash flows provided by financing activities     43,850       40,000  
                 
Net increase (decrease) in cash during year   $     $  

 

Operating Activities

 

Cash used in operating activities increased $3,850 from $40,000 to $43,850 due to the increase in consulting fees and general and administrative expenses during the current year.

 

Investing Activities

 

We did not use any cash for investing activities during the years ended January 31, 2019 and 2018.

 

Financing Activities

 

The $43,850 increase in cash provided by financing activities during the year ended January 31, 2019 was primarily due to increased operating costs for the Company as compared to proceeds of $40,000 during the year ended January 31, 2018.

 

 

 

 

  13  

 

 

Off-Balance Sheet Arrangements

 

We have no significant 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 stockholders.

   

Critical Accounting Policies

 

The discussion and analysis of our financial condition and results of operations is based upon the accompanying consolidated financial statements, which have been prepared in accordance with the accounting principles generally accepted in the United States of America and are expressed in United States Dollars. Preparing financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses. These estimates and assumptions are affected by management’s application of accounting policies. We believe that understanding the basis and nature of the estimates and assumptions involved with the following aspects of our financial statements is critical to an understanding of our financial statements.  

 

Foreign Currency Translation

 

Our company’s planned operations will be in the United States, which results in exposure to market risks from changes in foreign currency exchange rates. The financial risk is the risk to our company’s operations that arise from fluctuations in foreign exchange rates and the degree of volatility of these rates. Currently, our company does not use derivative instruments to reduce its exposure to foreign currency risk.

 

Our company’s functional currency for all operations worldwide is the U.S. dollar. Nonmonetary assets and liabilities are translated at historical rates and monetary assets and liabilities are translated at exchange rates in effect at the end of the year. Revenues and expenses are translated at average rates for the year. Gains and losses from translation of foreign currency financial statements into US dollars are included in current results of operations.

 

Revenue Recognition

 

Sales are recorded when products are shipped to customers. Provisions for discounts and rebates to customers, estimated returns and allowances, and other adjustments are provided for in the same period the related sales are recorded. No provision for discounts or rebates to customers, estimated returns and allowances or other adjustments were recognized during the year ended January 31, 2019. In instances where products are configured to customer requirements, revenue is recorded upon the successful completion of our final test procedures and the customer’s acceptance. Our company has not made any sales as of January 31, 2019.

 

Recently Issued Accounting Pronouncements

 

Our 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 accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations. 

 

Contractual Obligations

 

As a “smaller reporting company”, we are not required to provide tabular disclosure obligations.

 

Item 7A.        Quantitative and Qualitative Disclosures About Market Risk

 

As a “smaller reporting company”, we are not required to provide the information required by this Item.

 

 

 

  14  

 

 

Item 8.           Financial Statements and Supplementary Data

 

Avra Inc.

Financial Statements

 

Index

 

Report of Independent Registered Public Accounting Firms F-1
Balance Sheets as of January 31, 2019 and 2018 F-2
Statements of Operations for the Years Ended January 31, 2019 and 2018 F-3
Statement of Changes in Stockholders’ Deficit for the Years Ended January 31, 2019 and 2018 F-4
Statements of Cash Flows for the Years Ended January 31, 2019 and 2018 F-5
Notes to the Financial Statements F-6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  15  

 

 

Report of Independent Registered Public Accounting Firm

 

To the shareholders and the board of directors of Avra, Inc.

 

Opinion on the Financial Statements

We have audited the accompanying balance sheet of Avra, Inc. (the "Company") as of January 31, 2019, the related statement of operations, stockholders' equity (deficit), and cash flows for the year then ended, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of January 31, 2019, and the results of its operations and its cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States.

 

Basis for Opinion

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

 

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

 

Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.

 

Substantial Doubt about the Company’s Ability to Continue as a Going Concern

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 3 to the financial statements, the Company’s significant operating losses raise substantial doubt about its ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

 

 

/s/ BF Borgers CPA PC

BF Borgers CPA PC

 

Served as Auditor Since 2018

Lakewood, CO

May 20, 2019

 

 

 

 

 

 

  F- 1  

 

 

AVRA INC.

BALANCE SHEETS

 

 

    January     January  
    31, 2019     31, 2018  
ASSETS                
Current assets:                
Cash   $     $  
Total Current Assets            
Total assets   $     $  
                 
LIABILITIES AND STOCKHOLDERS' DEFICIT                
                 
Current liabilities:                
Accounts Payable and Accrued Liabilities   $ 84,773     $ 109,752  
Accounts Payable-Related Party     221,031       159,781  
Accrued Interest     75,835       46,533  
Notes Payable     258,796       214,946  
Stock Payable     115,496       115,496  
Total liabilities     755,931       646,508  
                 
Stockholders' deficit:                
Preferred Stock; Par Value $0.00001 100,000,000 shares authorized 0 issued and outstanding as of January 31, 2019 and 2018            
Common stock; $0.00001 par value authorized 300,000,000; 63,397,094 shares issued and outstanding as of January 31, 2019 and 2018     634       634  
Additional Paid in Capital     194,062       194,062  
Accumulated Deficit     (950,627 )     (841,204 )
Total stockholders' deficit     (755,931 )     (646,508 )
                 
Total liabilities and stockholders' equity   $     $  

 

The accompanying notes are an integral part of these financial statements
 

 

 

 

 

 

 

 

  F- 2  

 

 

AVRA INC.

STATEMENTS OF OPERATIONS

 

 

    Year Ended January 31, 2019     Year Ended January 31, 2018  
             
Operating Expenses:                
General and administrative   $ 97,780     $ 90,906  
Total Operating Expenses     97,780       90,906  
                 
Loss from Operations   $ (97,780 )   $ (90,906 )
                 
Other Expenses                
Gain on forgiveness of debt     17,659       21,632  
Interest Expense, net     (29,302 )     (14,549 )
Total other income (expense)     (11,643 )     (7,083 )
                 
Net loss for the period   $ (109,423 )   $ (83,823 )
                 
Net loss per share:                
Basic and diluted   $     $  
                 
Weighted average number of shares outstanding:                
Basic and diluted     63,397,094       63,397,094  

 

The accompanying notes are an integral part of these financial statements

 

 

 

 

 

 

 

 

 

 

 

 

  F- 3  

 

 

AVRA, INC.

STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (DEFICIT)

                 

 

    Common Stock     Additional           Total  
   

Number

of Shares

    Par Value    

Paid in

Capital

    Accumulated Deficit    

Shareholders'

Equity

 
                               
BALANCE JANUARY 31, 2016     63,397,067     $ 634     $ 194,062     $ (681,216 )   $ (486,520 )
Net Loss                       (76,165 )     (76,165 )
BALANCE JANUARY 31, 2017     63,397,067     $ 634     $ 194,062     $ (757,381 )   $ (562,685 )
Net Loss                       (83,823 )     (83,823 )
BALANCE JANUARY 31, 2018     63,397,067     $ 634     $ 194,062     $ (841,204 )   $ (646,508 )
Net Loss                       (109,423 )     (109,423 )
BALANCE JANUARY 31, 2019     63,397,067     $ 634     $ 194,062     $ (950,627 )   $ (755,931 )

 

The accompanying notes are an integral part of these financial statements

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  F- 4  

 

 

AVRA INC.

CONDENSED STATEMENTS OF CASH FLOWS

(Unaudited)

 

 

    Year Ended January 31, 2019     Year Ended January 31, 2018  
             
Cash flow from operating activities:                
Net loss   $ (109,423 )   $ (83,823 )
Adjustments to reconcile net loss to net cash used in operating activities:                
Accrued Interest     29,302       14,549  
Changes in operating assets and liabilities:                
Prepaid expenses           600  
Accounts Payable     (24,979 )     44,742  
Accounts Payable-related party     61,250       (16,068 )
Net Cash used in operating activities   $ (43,850 )   $ (40,000 )
                 
Cash flows from financing activities:                
Proceeds from note payable   $ 43,850     $ 40,000  
Net cash provided by financing activities   $ 43,850     $ 40,000  
                 
Decrease in cash during the period            
                 
Cash, beginning of period            
                 
Cash, end of period   $     $  
                 
Supplemental disclosure of cash flow information:                
Cash paid during the period     -       -  
Gain on forgiveness of debt   $ (17,659 )   $ (21,632 )

 

The accompanying notes are an integral part of these financial statements

 

 

 

 

 

 

 

 

  F- 5  

 

 

Avra, Inc.

Notes to the Financial Statements

 

Note 1 - Organization and Operations

 

Nature of Business and Continuance of Operations

 

Avra Inc. (the “Company”) was incorporated in the State of Nevada on December 1, 2010. The Company, is focused on solutions in the cryptocurrency and digital currency markets, particularly in offering payment solutions to businesses worldwide. The Company also has a business in marketing and distributing of Smart TV boxes to home consumers throughout the United States. Smart TV boxes are hardware devices that allow consumers to combine all of the benefits of the Internet with the large size and high definition capabilities of TV screens; however, this is not the Company’s focus.

 

The Company’s business model can be broken down into four distinct categories, as follows: AvraPay: To develop a complete, turn-key and painless way for merchants to accept Bitcoin as payment; AvraATM: To promote usage and acceptance of digital currencies through the Company's proposed network of ATMs; AvraTourism: To provide cryptocurrency payment processing solutions for merchants such as hotels and casinos; AvraNews: To provide a news portal focusing on digital currency news.

These financial statements have been prepared on a going concern basis, which assumes the Company will continue to realize its assets and discharge its liabilities in the normal course of business.

 

These consolidated financial statements have been prepared on a going concern basis, which assumes the Company will continue to realize its assets and discharge its liabilities in the normal course of business. The continuation of the Company as a going concern is dependent upon the continued financial support from its shareholders, the ability of the Company to obtain necessary equity financing to continue operations, and the attainment of profitable operations. As of January 31, 2019, the Company has working capital deficit of $755,931 and has an accumulated deficit totaling $950,627 since inception, and has not yet generated any revenue from operations. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. These financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

 

The Company’s management plans to raise funds in the next 12 months through a combination of debt financing and equity financing by way of private placement.

 

Note 2 - Significant and Critical Accounting Policies and Practices

 

a) Basis of Presentation

 

These consolidated financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States and are expressed in US dollars. The Company’s fiscal year end is January 31.

 

b) Use of Estimates

 

The preparation of financial statements in conformity with United States 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 of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions related to stock-based compensation and deferred income tax asset valuation allowances.

 

 

 

 

  F- 6  

 

 

The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.

 

c) Reclassification

 

Certain prior period amounts have been reclassified to conform to current period presentation.

 

d) Cash and Cash Equivalents

 

The Company considers all highly liquid instruments with an original maturity of three months or less at the time of issuance to be cash equivalents.

 

e) Financial Instruments

 

The Company’s financial instruments consist principally of cash and cash equivalents, accounts payable and accrued liabilities, short-term debts and due to related parties. Pursuant to ASC 820, Fair Value Measurements and Disclosures and ASC 825, Financial Instruments the fair value of the Company’s cash equivalents is determined based on “Level 1” inputs, which consist of quoted prices in active markets for identical assets.

 

f) Loss Per Common Share

 

Basic EPS is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing Diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive. At January 31, 2019, the Company has no potentially dilutive securities outstanding.

 

g) Foreign Currency Translation

 

The Company’s planned operations will be in the United States, which results in exposure to market risks from changes in foreign currency exchange rates. The financial risk is the risk to the Company’s operations that arise from fluctuations in foreign exchange rates and the degree of volatility of these rates. Currently, the Company does not use derivative instruments to reduce its exposure to foreign currency risk. The Company's functional currency for all operations worldwide is the U.S. dollar. Nonmonetary assets and liabilities are translated at historical rates and monetary assets and liabilities are translated at exchange rates in effect at the end of the year. Revenues and expenses are translated at average rates for the year. Gains and losses from translation of foreign currency financial statements into U.S. dollars are included in current results of operations.

 

h) Revenue Recognition

 

ASU No. 2014-09Revenue from Contracts with Customers (“Topic 606”), became effective for the Company on January 1, 2018. The Company’s revenue recognition disclosure reflects its updated accounting policies that are affected by this new standard. The Company applied the “modified retrospective” transition method for open contracts for the implementation of Topic 606.  The Company made no adjustments to its previously-reported total revenues, as those periods continue to be presented in accordance with its historical accounting practices under Topic 605, Revenue Recognition.

 

 

 

 

  F- 7  

 

 

The Company will recognize revenue according to Topic 606 in a manner that reasonably reflects the delivery of its services and products to customers in return for expected consideration and includes the following elements:

 

  executed contracts with the Company’s customers that it believes are legally enforceable;

 

  identification of performance obligations in the respective contract;

 

  determination of the transaction price for each performance obligation in the respective contract;

 

  allocation the transaction price to each performance obligation; and

 

  recognition of revenue only when the Company satisfies each performance obligation.

 

The Company has not made any sales as of January 31, 2019.

 

i) Income Taxes

 

The Company accounts for income taxes using the asset and liability method in accordance with ASC 740, 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.

 

j) Stock-Based Compensation

 

We estimate the fair value of each stock option award at the grant date by using the Black-Scholes option pricing model and common shares based on the market price of the Company’s common stock on the date of the share grant. The fair value determined represents the cost for the award and is recognized over the vesting period during which an employee is required to provide service in exchange for the award. As share-based compensation expense is recognized based on awards ultimately expected to vest, we reduce the expense for estimated forfeitures based on historical forfeiture rates. Previously recognized compensation costs may be adjusted to reflect the actual forfeiture rate for the entire award at the end of the vesting period. Excess tax benefits, if any, are recognized as an addition to paid-in capital.

 

k) Subsequent Events

 

The Company’s management reviewed all material events from January 31, 2019, through the issuance date of these financial statements for disclosure consideration.

 

 

 

 

  F- 8  

 

 

l) Recent Accounting Pronouncements

 

In August 2014, the FASB issued ASU No. 2014-15, “Disclosure of Uncertainties About an Entity’s Ability to Continue as a Going Concern” (“ASU 2014-15”), which requires management to perform interim and annual assessments of an entity’s ability to continue as a going concern within one year of the date the financial statements are issued and provides guidance on determining when and how to disclose going concern uncertainties in the financial statements. Certain disclosures will be required if conditions give rise to substantial doubt about an entity’s ability to continue as a going concern. ASU 2014-15 applies to all entities and is effective for annual and interim reporting periods ending after December 15, 2016, with early adoption permitted. This standard has no material effect on our financial statements

  

In March 2016, the FASB issued an ASU amending the accounting for stock-based compensation and requiring excess tax benefits and deficiencies to be recognized as a component of income tax expense rather than equity. This guidance also requires excess tax benefits to be presented as an operating activity on the statement of cash flows and allows an entity to make an accounting policy election to either estimate expected forfeitures or to account for them as they occur. The ASU is effective for reporting periods beginning after December 15, 2016, with early adoption permitted, this standard has no material effect on our financial statements.

 

In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash, which requires restricted cash to be presented with cash and cash equivalents on the statement of cash flows and disclosure of how the statement of cash flows reconciles to the balance sheet if restricted cash is shown separately from cash and cash equivalents on the balance sheet.

 

ASU 2016-18 is effective for interim and annual periods beginning after December 15, 2017, with early adoption permitted. The Company is in the process of evaluating the impact of this ASU on its CFS.

 

In January 2017, the FASB issued an ASU 2017-01, Business Combinations (Topic 805) Clarifying the Definition of a Business. The amendments in this update clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions or disposals of assets or businesses. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill, and consolidation.

 

The guidance is effective for interim and annual periods beginning after December 15, 2017 and should be applied prospectively on or after the effective date. The Company is in the process of evaluating the impact of this ASU on its CFS.

 

In October 2017, FASB issued ASU 2017-11, Earnings Per Share (Topic 260) Distinguishing Liabilities from Equity (Topic 480) Derivatives and Hedging (Topic 815): I. Accounting for Certain Financial Instruments with Down Round Features, II. Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception. Part I of this ASU changes the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features and clarifies existing disclosure requirements. Part II does not have an accounting effect. The ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018 with early adoption permitted. Management is currently evaluating the potential impact of these changes on the CFS of the Company.

 

As of January 31, 2019, there are no recently issued accounting standards not yet adopted that would have a material effect on the Company’s financial statements to have a material impact on the Company’s CFS.

 

 

 

 

  F- 9  

 

 

Note 3 – Going Concern

 

The Company’s 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 financial statements, the Company had an accumulated deficit of $950,627 at January 31, 2019, a net loss of $109,423 and net cash used in operating activities of $43,850 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 the Company’s daily operations. Management intends to raise additional funds by way of a private or public offering. 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 the Company’s 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- Notes Payable

 

On August 1, 2013, the Company entered into a loan agreement in which the note holder agreed to provide a loan to the Company in the principal amount of up to $50,000. The loan is unsecured, bears interest at 8% per annum and payable on August 1, 2014. The loan agreement has been amended when the loan amount was increased to $75,000 with an extension of the maturity date to August 1, 2015. As of January 31, 2019, the maturity date has not been extended and the loan is due on demand. As of January 31, 2019, the note holder has provided a total $69,946 to the Company. As of January 31, 2019 no payments have been made to the note holder.

 

On June 5, 2017 the Company and Note Holder amended the original promissory note by executing a new convertible promissory note with the Note Holder in the principal amount of $69.946 plus accrued interest that provides an interest rate of 8% per annum and a maturity date of June 5, 2018. The note also provides a conversion feature allowing the note holder to convert principal and or accrued interest at a fixed rate of $0.005 per share. The Note also, provides for a default interest rate of 20% if the note is unpaid past the maturity date. The loan is currently in default, and interest has increased to 20% (the default rate) and no payments have been made to the note holder as January 31, 2019.

 

On February 3, 2015, the Company entered into a loan agreement in which the note holder agreed to provide a loan to the Company in the principal amount of $25,000. Subsequently, the loan was amended to increase the principal balance to $100,000. The loan bears interest at 7.5% per annum and is due on demand. As of January 31, 2019, the note holder has provided $100,000 to the Company. As of January 31, 2019 no payments have been made to the note holder.

 

On July 17, 2017 the Company and Note Holder amended the original promissory note by executing a new convertible promissory note with the Note Holder in the principal amount of $100,000 plus accrued interest that provides an interest rate of 8% per annum and a maturity date of July 17, 2018.

 

The note also provides a conversion feature allowing the note holder to convert principal and or accrued interest at a fixed rate of $0.005 per share. The Note also, provides for a default interest rate of 15% if the note is unpaid past the maturity date. The loan is currently in default, and interest has increased to 15% (the default rate) and no payments have been made to the note holder as January 31, 2019.

 

 

 

  F- 10  

 

 

On May 9, 2017, The Company entered into a promissory note for $5,000. The note carries an annual interest rate of 8% with a maturity date of May 9, 2018. The debt is due on the maturity date and can be paid in either cash or with the Company’s common stock at a fixed price of $0.005 The Note also, provides for a default interest rate of 15% if the note is unpaid past the maturity date. It should also be noted that this Note is also a reclassification from an advance payable to a note payable. As of January 31, 2019, the note holder has provided a total $5,000 to the Company. The loan is currently in default and interest has increased to 15% (the default rate) and no payments have been made to the note holder as January 31, 2019.

 

On August 14, 2017, the Company entered into a convertible note in the principal amount of $20,000, with an unrelated third party. The note carries an annual interest rate of 8% with a maturity date of September 28, 2018. The debt is due on the maturity date and can be paid in either cash or with the Company’s common stock at a fixed price of $0.005 The Note also, provides for a default interest rate of 15% if the note is unpaid past the maturity date. The loan is currently in default and interest has increased to 15% (the default rate) and no payments have been made to the note holder as January 31, 2019.

 

On November 1, 2017, the Company entered into a convertible note in the principal amount of $20,000, with an unrelated third party. The note carries an annual interest rate of 8% with a maturity date of October 31, 2018. The debt is due on the maturity date and can be paid in either cash or with the Company’s common stock at a fixed price of $0.005 The Note also, provides for a default interest rate of 15% if the note is unpaid past the maturity date. The loan is currently in default and interest has increased to 15% (the default rate) and no payments have been made to the note holder as January 31, 2019.

 

February 16, 2018, the Company entered into a convertible note in the principal amount of $18,500, with an unrelated third party. The note carries an annual interest rate of 8% with a maturity date of April 10, 2019. The debt is due on the maturity date and can be paid in either cash or with the Company’s common stock at a fixed price of $0.005 The Note also, provides for a default interest rate of 15% if the note is unpaid past the maturity date.

 

On August 31, 2018, the Company entered into a convertible note in the principal amount of $7,850, with an unrelated third party. The note carries an annual interest rate of 8% with a maturity date of August 31, 2019. The debt is due on the maturity date and can be paid in either cash or with the Company’s common stock at a fixed price of $0.005 The Note also, provides for a default interest rate of 15% if the note is unpaid past the maturity date.

 

On December 27, 2018, the Company entered into a convertible note in the principal amount of $12,000, with an unrelated third party. The note carries an annual interest rate of 8% with a maturity date of December 27, 2019. The debt is due on the maturity date and can be paid in either cash or with the Company’s common stock at a fixed price of $0.005 The Note also, provides for a default interest rate of 15% if the note is unpaid past the maturity date.

 

On August 31, 2018 and December 27, 2018, the Company entered into convertible notes in the principal amount of $3,000 and $2,500 respectively, with two unrelated third parties. The notes carry an annual interest rate of 8% with maturity dates of August 31 2019, and December 27, 2019. The debt is due on the maturity date and can be paid in either cash or with the Company’s common stock at a fixed price of $0.005 The Note also, provides for a default interest rate of 15% if the note is unpaid past the maturity date.

 

 

 

 

 

  F- 11  

 

 

Note 5 – Stock Payable

 

On November 1, 2014, the Company entered into a consulting agreement with a consultant who will provide consulting services in consideration for $7,000 per month for a 1 year term, ending on December 1, 2015. The consulting agreement is currently month-to-month. The consulting fee is payable as follows:

 

i. $3,500 per month settled in shares which will be converted at a 50% discount of the lowest 3 trading prices for the Company’s common stock during the last 10 trading days of each month.

 

ii. $3,500 per month payable in cash at the end of each month in which the consultant also has the option to convert into shares at a market price less a 50% discount of the lowest 3 trading prices for the Company’s common stock during the last 10 trading days from the date of conversion.

 

As of October 31, 2017, the Company paid $10,500 and issued 0 shares to the consultant, $31,500 and $115,496 has been accrued in accounts payable and stock payable, respectively.

 

Note 6- Gain on Forgiveness of Debt

 

During the year ended January 31, 2019 two unrelated party vendors representing an aggregate total of $17,659 has agreed to write off the amounts owing to them, creating a reduction in accounts payable and a gain in the Statements of Operations.

 

Note 7 - Related Party Transaction

 

As of January 31, 2019, the Company is indebted to Stephen Shepherd, CEO of the Company for $221,031. This amount represents non-interest bearing advances payable of $12,688 and unpaid Management fees of $208,343. During the year ended January 31, 2019, the Company expensed $60,000 of management fees to the CEO of the Company and paid him an aggregate total of $0.

 

Note 8 - Stockholders’ Deficit

 

The Company’s authorized capital consisted of 300,000,000 shares of common stock with a par value of $0.00001 per share and 100,000,000 shares of preferred stock with a par value of $0.00001 per share.

 

Note 9 – Subsequent Events

 

On March 25, 2019 the Company filed with FINRA a Reverse Split so that each two hundred (200) shares of common stock issued and outstanding shall, automatically and without any action on the part of the respective holders thereof, be combined and converted into one (1) share of common stock. to date the Reverse split is not effective.

 

 

 

 

 

 

 

 

  F- 12  

 

 

Item 9.       Changes in and Disagreements With Accountants on Accounting and Financial Disclosure

 

There were no disagreements related to accounting principles or practices, financial statement disclosure, internal controls or auditing scope or procedure during the two fiscal years and interim periods.

 

Item 9A.      Controls and Procedures

 

Evaluation of Disclosure Controls and Procedures

 

Disclosure controls and procedures are designed to ensure that information required to be disclosed in the reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported, within the time period specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in the reports filed under the Exchange Act is accumulated and communicated to management, including our chief executive officer and chief financial officer (our principal executive officer, principal financial officer and principal accounting officer). We carried out an evaluation, under the supervision and with the participation of our management, including our chief executive officer and chief financial officer (our principal executive officer, principal financial officer and principal accounting officer), of the effectiveness of the design and operation of our disclosure controls and procedures as of January 31, 2017. Based upon the evaluation of our disclosure controls and procedures as of the January 31, 2017, our chief executive officer and chief financial officer (our principal executive officer, principal financial officer and principal accounting officer) concluded that our disclosure controls and procedures were not effective because of the identification of a material weakness in our internal control over financial reporting which is identified below, which we view as an integral part of our disclosure controls and procedures.

 

Management’s Report on Internal Control over Financial Reporting

 

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Rule 13a-15(f). Our internal control over financial reporting is a process designed to provide reasonable assurance to our management and board of directors regarding the reliability of financial reporting and the preparation of the financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America.

 

Our internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America, and our receipts and expenditures of are being made only in accordance with authorizations of our management and directors; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of our assets that could have a material effect on the financial statements.

 

Because of its inherent limitations, internal controls over financial reporting may not prevent or detect misstatements. All internal control systems, no matter how well designed, have inherent limitations, including the possibility of human error and the circumvention of overriding controls. Accordingly, even effective internal control over financial reporting can provide only reasonable assurance with respect to financial statement preparation. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

 

The material weakness relates to the lack of segregation of duties in our financial reporting process and our utilization of outside third party consultants. We do not have a separately designated audit committee. This weakness is due to our lack of sufficient working capital to hire additional staff. To remedy this material weakness, we intend to engage an internal accounting staff to assist with financial reporting as soon as our finances will allow.

 

Changes in Internal Control

 

There were no changes in our internal control over financial reporting (as defined in Rule 13a-15(e) and Rule 15d-15(e) under the Exchange Act) during the last fiscal quarter that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

Item 9B.        Other Information

 

None.

 

 

 

  16  

 

 

PART III

 

Item 10.         Directors, Executive Officers and Corporate Governance

 

Our directors will serve in that capacity until our next annual shareholder meeting or until their successors are elected and qualified. Officers hold their positions at the will of our board of directors. There are no arrangements, agreements or understandings between non-management security holders and management under which non-management security holders may directly or indirectly participate in or influence the management of our affairs.

 

Name   Position Held
with our Company
  Age   Date First Elected or Appointed
Stephen Shepherd   President, Chief Executive Officer, Chief Financial Officer, and Director   36   May 30, 2014
Xiaojian Lu   Secretary and Chief Marketing Officer   31   May 30, 2014 (Resigned August 23, 2018)

 

Business Experience

 

The following is a brief account of the education and business experience during at least the past five years of each director, executive officer and key employee of our company, indicating the person’s principal occupation during that period, and the name and principal business of the organization in which such occupation and employment were carried out.

 

Stephen Shepherd, has 15 years’ experience with various financial institutions in the financial services sales & marketing industry. He formed Marketing Inteligente SRL, a marketing consulting company, in December of 2008 and presently serves as its President.  From April 2011 to December 2012, Mr. Shepherd was a Senior Investment Consultant in the Dominican Republic for St. James International, a firm of independent investment brokers.  Mr. Shepherd studied Business Economics while attending the University of Leicester from 1996 to 1999.

 

Mr. Shepherd’s professional qualifications include a Financial Planning Certificate from The Chartered Insurance Institute of the United Kingdom as well as a Certificate of Regulated General Insurance and a Certificate in Mortgage Advice and Practice from The Institute of Financial Services also located in the United Kingdom. 

 

Xiaojian Lu, has, since June 2012, worked as the Technical Manager for Hangzhou Dianchuang Science and Technology Co. Ltd.  Prior to this Mr. Lu worked as a Technical Supervisor for Changhuatong Online Telephone Co. Ltd. from December 2009 to June 2012 and as a Division Manager for Hangzhou Youheng Internet Science Technology Co. Ltd. from May 2008 to December 2009.  Mr. Lu studied Computer Science at Zhejiang University in Hangzhou, Zhejiang Province where he received his Bachelor’s Degree. Mr. Lu resigned all of his positions as an officer and director on August 23, 2018

 

Significant Employees

 

There are no individuals other than our executive officers who make a significant contribution to our business.

 

 

 

  17  

 

 

Involvement in Certain Legal Proceedings

 

To the best of our knowledge, none of our directors or executive officers has, during the past ten years:

 

1.     been convicted in a criminal proceeding or been subject to a pending criminal proceeding (excluding traffic violations and other minor offences);

 

2.     had any bankruptcy petition filed by or against the business or property of the person, or of any partnership, corporation or business association of which he was a general partner or executive officer, either at the time of the bankruptcy filing or within two years prior to that time;

 

3.     been subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction or federal or state authority, permanently or temporarily enjoining, barring, suspending or otherwise limiting, his involvement in any type of business, securities, futures, commodities, investment, banking, savings and loan, or insurance activities, or to be associated with persons engaged in any such activity;

 

4.     been found by a court of competent jurisdiction in a civil action or by the SEC or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated;

 

5.     been the subject of, or a party to, any federal or state judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated (not including any settlement of a civil proceeding among private litigants), relating to an alleged violation of any federal or state securities or commodities law or regulation, any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order, or any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or

 

6.     been the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C. 78c(a)(26)), any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act (7 U.S.C. 1(a)(29)), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.

 

Compliance with Section 16(a) of the Securities Exchange Act of 1934

 

Our common stock is not registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Accordingly, our officers, directors, and principal stockholders are not subject to the beneficial ownership reporting requirements of Section 16(a) of the Exchange Act.

 

Other Directorships

 

None of our directors hold any other directorships in any company with a class of securities registered pursuant to Section 12 of the Exchange Act or subject to the requirements of section 15(d) of such Act or any company registered as an investment company under the Investment Company Act of 1940.

 

 

 

 

  18  

 

 

Board of Directors and Director Nominees

 

Since our board of directors does not include a majority of independent directors, the decisions of the board regarding director nominees are made by persons who have an interest in the outcome of the determination. The board will consider candidates for directors proposed by security holders, although no formal procedures for submitting candidates have been adopted. Unless otherwise determined, at any time not less than 90 days prior to the next annual board meeting at which the slate of director nominees is adopted, the board will accept written submissions from proposed nominees that include the name, address and telephone number of the proposed nominee; a brief statement of the nominee’s qualifications to serve as a director; and a statement as to why the security holder submitting the proposed nominee believes that the nomination would be in the best interests of our security holders. If the proposed nominee is not the same person as the security holder submitting the name of the nominee, a letter from the nominee agreeing to the submission of his or her name for consideration should be provided at the time of submission. The letter should be accompanied by a résumé supporting the nominee's qualifications to serve on the board, as well as a list of references.

 

The board identifies director nominees through a combination of referrals from different people, including management, existing board members and security holders. Once a candidate has been identified, the board reviews the individual's experience and background and may discuss the proposed nominee with the source of the recommendation. If the board believes it to be appropriate, board members may meet with the proposed nominee before making a final determination whether to include the proposed nominee as a member of the slate of director nominees submitted to security holders for election to the board.

 

Some of the factors which the board considers when evaluating proposed nominees include their knowledge of and experience in business matters, finance, capital markets and mergers and acquisitions. The board may request additional information from each candidate prior to reaching a determination. The board is under no obligation to formally respond to all recommendations, although as a matter of practice, it will endeavor to do so.

 

Code of Ethics

 

We have not adopted a code of ethics that applies to our officers, directors and employees.

 

Board and Committee Meetings

 

Our board of directors held no formal meetings during the year ended January 31, 2017. All proceedings of the board of directors were conducted by resolutions consented to in writing by all the directors and filed with the minutes of the proceedings of the directors. Such resolutions consented to in writing by the directors entitled to vote on that resolution at a meeting of the directors are, according to the Nevada Revised Statues and our Bylaws, as valid and effective as if they had been passed at a meeting of the directors duly called and held.

 

Audit Committee Financial Expert

 

Our board of directors has determined that none of the members of our audit committee qualifies as an “audit committee financial expert” as defined in Item 407(d)(5)(ii) of Regulation S-K, and is “independent” as the term is used in Item 7(d)(3)(iv) of Schedule 14A under the Securities Exchange Act of 1934, as amended.

 

 

 

 

  19  

 

 

We believe that the members of our board of directors are collectively capable of analyzing and evaluating our financial statements and understanding internal controls and procedures for financial reporting. We believe that retaining an independent director who would qualify as an “audit committee financial expert” would be overly costly and burdensome and is not warranted in our circumstances given the early stages of our development and the fact that we have not generated any material revenues to date. In addition, we currently do not have nominating, compensation or audit committees or committees performing similar functions nor do we have a written nominating, compensation or audit committee charter. Our board of directors does not believe that it is necessary to have such committees because it believes the functions of such committees can be adequately performed by our board of directors.

 

Family Relationships

 

There are no family relationships among our officers, directors, or persons nominated for such positions.

 

Item 11.     Executive Compensation

 

The particulars of the compensation paid to the following persons:

 

a) our principal executive officer;

 

b) each of our two most highly compensated executive officers who were serving as executive officers at the end of the years ended January 31, 2019 and 2018; and

 

c) up to two additional individuals for whom disclosure would have been provided under (b) but for the fact that the individual was not serving as our executive officer at the end of the years ended January 31, 2019 and 2018;  

 

who we will collectively refer to as the named executive officers of our company, are set out in the following summary compensation table, except that no disclosure is provided for any named executive officer, other than our principal executive officers, whose total compensation did not exceed $100,000 for the respective fiscal year:

 

Name

and

Principal

Position

 

Fiscal

Year

Ended

6/30

 

 

 

 

Salary

($)

 

Bonus

($)

 

Stock

Awards

($)

 

Option

Awards

($)

 

Non-Equity

Incentive

Plan

Compensation

($)

 

Change in
Pension
Value and

Nonqualified

Deferred

Compensation

Earnings

($)

 

All Other Compensation

($)

 

Total

($)

Stephen Shepard
  2019   60,000   -0-   -0-   -0-   -0-   -0-   -0-   -0-
President, CEO, Treasurer and Director   2018   60,000   -0-   -0-   -0-   -0-   -0-   -0-   -0-
Xiaojian Lu
  2019   -0-   -0-   -0-   -0-   -0-   -0-   -0-   -0-
Secretary and Director   2018   -0-   -0-   -0-   -0-   -0-   -0-   -0-   -0-

 

 

 

 

  20  

 

 

Option Grants

 

We have not granted any options or stock appreciation rights to our named executive officers or directors since inception. We do not have any stock option plans.

 

Employment Agreements

 

We have not entered into any employment agreements with our executive officers.

 

Compensation of Directors

 

Our directors did not receive any compensation for their services as directors from our inception to January 31, 2019. We have no formal plan for compensating our directors for their services in the future in their capacity as directors, although such directors are expected in the future to receive options to purchase shares of our common stock as awarded by our board of directors or by any compensation committee that may be established.

 

Pension, Retirement or Similar Benefit Plans

 

There are no arrangements or plans in which we provide pension, retirement or similar benefits to our directors or executive officers. We have no material bonus or profit sharing plans pursuant to which cash or non-cash compensation is or may be paid to our directors or executive officers, except that stock options may be granted at the discretion of the board of directors or a committee thereof.

 

Item 12.     Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

 

The following table sets forth, as of January 31, 2019, certain information with respect to the beneficial ownership of our common shares by each shareholder known by us to be the beneficial owner of more than 5% of our common shares, as well as by each of our current directors and executive officers as a group. Each person has sole voting power with respect to the shares of common stock, except as otherwise indicated. Beneficial ownership consists of a direct interest in the shares of common stock, except as otherwise indicated.

 

Under Rule 13d-3, a beneficial owner of a security includes any person who, directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise has or shares: (i) voting power, which includes the power to vote, or to direct the voting of shares; and (ii) investment power, which includes the power to dispose or direct the disposition of shares. Certain shares may be deemed to be beneficially owned by more than one person (if, for example, persons share the power to vote or the power to dispose of the shares). In addition, shares are deemed to be beneficially owned by a person if the person has the right to acquire the shares (for example, upon exercise of an option) within 60 days of the date as of which the information is provided. In computing the percentage ownership of any person, the amount of shares outstanding is deemed to include the amount of shares beneficially owned by such person (and only such person) by reason of these acquisition rights. As a result, the percentage of outstanding shares of any person as shown in this table does not necessarily reflect the person’s actual ownership or voting power with respect to the number of shares of common stock actually outstanding on January 31, 2019. As of January 31, 2019, there were 63,397,067 shares of our company’s common stock issued and outstanding. Unless otherwise stated, the address of the shareholder is c/o Avra Inc., Plaza Compostela 4D2, Av. John F Kennedy, Ensanche Paraiso, Santo Domingo, Dominican Republic.

 

 

 

 

  21  

 

 

Name and Address of Beneficial Owner   Amount and Nature of
Beneficial Ownership
    Percentage
of Class
 
Stephen Shepherd     35,333,333       55.73%  
Xiaojian Lu     0        
Directors and Executive Officers as a Group
(2 persons)
    35,333,333       55.73%  

 

Item 13.     Certain Relationships and Related Transactions, and Director Independence

 

None.

 

Item 14.     Principal Accounting Fees and Services

 

The aggregate fees billed for the most recently completed fiscal years ended January 31, 2019 and 2018 for professional services rendered by the principal accountant for the audit of our annual financial statements and review of the financial statements included in our quarterly reports on Form 10-Q and services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for these fiscal periods were as follows: 

 

    Years Ended  
    January 31,
2019
    January 31,
2018
 
Audit Fees   $ 9,500     $ 9,500  
Audit Related Fees            
Tax Fees            
All Other Fees            
Total   $ 9,500     $ 9,500  

 

On February 27, 2018, Avra, Inc. (the “Company”) dismissed GBH CPAs, PC as its independent registered public accounting firm.

 

GBH CPAs, PC’s report on the Company’s financial statements for the fiscal years ended January 31, 2017 and January 31, 2016 contained an opinion on the uncertainty of the Company to continue as a going concern because of the Company’s need to raise additional working capital to service its debt and for its planned activity.

 

Other than as disclosed in Item 4.01(a)(ii) GBH CPAs, PC’s report on the financial statements for either of the past two fiscal years did not contain an adverse opinion or a disclaimer of opinion, or was qualified or modified as to uncertainty, audit scope, or accounting principles, disclaimer of opinion, modification, or qualification in accordance with 304(a)(1)(ii) of Regulation S-K.

 

The Company’s Board of Directors approved the decision to change its independent registered public accounting firm.

 

 

 

 

  22  

 

 

During the fiscal years ended January 31, 2017 and January 31, 2016, and the subsequent interim periods and further through the date of dismissal of, there have been no disagreements with GBH CPAs, PC on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreement if not resolved to the satisfaction of, would have caused them to make reference to the subject matter of the disagreement(s) in connection with their report on the Company’s financial statements for such years; and there were no reportable events, as listed in Item 304(a)(1)(v) of Regulation S-K.

 

During the fiscal years ended January 31, 2017 and January 31, 2016, and further through the date of dismissal of GBH CPAs, PC , GBH CPAs, PC  did not advise the Company on any matter set forth in Item 304(a)(1)(v)(A) through (D) of Regulation S-K.

 

The Company dismissed GBH CPAs, PC as a decision by Management.

 

Engagement of New Independent Registered Public Accounting Firm

 

On February 27, 2018 the Company engaged (“BF Borgers CPA, PC) as our new independent registered public accounting firm to audit the Company’s financial statements for the fiscal year ending January 31, 2019. During the past two fiscal years and the subsequent interim periods preceding the engagement, the Company did not consult with  BF Borgers CPA, PC regarding (i) the application of accounting principles to a specific transaction, either completed or proposed, or the type of audit opinion that might be rendered on the Company’s financial statements, and no written report or oral advice was provided to the Company by BF Borgers CPA, PC concluding there was an important factor to be considered by the Company in reaching a decision as to an accounting, auditing or financial reporting issue; or (ii) any matter that was either the subject of a disagreement, as that term is defined in Item 304 (a)(1)(iv) of Regulation S-K or a reportable event, as that term is described in Item 304 (a)(1)(v) of Regulation S-K.

 

Effective May 6, 2003, the Securities and Exchange Commission adopted rules that require that before our independent auditors are engaged by us to render any auditing or permitted non-audit related service, the engagement be:

 

approved by our audit committee (which consists of our entire board of directors); or

 

entered into pursuant to pre-approval policies and procedures established by the board of directors, provided the policies and procedures are detailed as to the particular service, the board of directors is informed of each service, and such policies and procedures do not include delegation of the board of directors' responsibilities to management.

 

Our board of directors pre-approves all services provided by our independent auditors. All of the above services and fees were reviewed and approved by the board of directors either before or after the respective services were rendered.

 

Our board of directors has considered the nature and amount of fees billed by our independent auditors and believes that the provision of services for activities unrelated to the audit is compatible with maintaining our independent auditors’ independence.

 

 

 

 

 

 

 

 

 

  23  

 

 

PART IV

 

Item 15.     Exhibits, Financial Statement Schedules

 

(a) Financial Statements

 

(1) Financial statements for our company are listed in the index under Item 8 of this document

 

(2) All financial statement schedules are omitted because they are not applicable, not material or the required information is shown in the financial statements or notes thereto.

 

(b) Exhibits

 

Exhibit Number Description
(3) Articles of Incorporation and Bylaws
3.1 Articles of Incorporation (incorporated by reference to our Registration Statement on Form S-1 filed on June 14, 2012)
3.2 Bylaws (incorporated by reference to our Registration Statement on Form S-1 filed on June 14, 2012)
(31) Rule 13a-14(a) / 15d-14(a) Certifications
31.1* Section 302 Certification under the Sarbanes-Oxley Act of 2002 of the Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer
(32) Section 1350 Certifications
32.1** Section 906 Certification under the Sarbanes-Oxley Act of 2002 of the Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer
(101) Interactive Data File
101.INS
101.SCH  
101.CAL  
101.DEF  
101.LAB  
101.PRE  

XBRL Instance Document

XBRL Taxonomy Extension Schema Document

XBRL Taxonomy Extension Calculation Linkbase Document

XBRL Taxonomy Extension Definition Linkbase Document

XBRL Taxonomy Extension Label Linkbase Document

XBRL Taxonomy Extension Presentation Linkbase Document

 

*      Filed herewith.

**   In accordance with SEC Release 33-8238, Exhibit 32.1 is being furnished and not filed. 

 

 

 

 

 

 

 

 

  24  

 

 

SIGNATURES

 

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereto duly authorized.

 

     
    AVRA INC.
    (Registrant)
     
Dated: January 13, 2021   /s/ Everett Dickson
    Everett Dickson
    President, Chief Executive Officer and Chief Financial Officer
    (Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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