UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

QUARTERLY REPORT UNDER TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED DECEMBER 31, 2020
   
  OR
   
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

Commission file number 000-55256

 

Kibush Capital Corp.

(Exact Name of Small Business Issuer as specified in its charter)

 

Nevada

(State or other Jurisdiction of Incorporation or Organization)

 

c/o CSC Services of Nevada, Inc.

2215-B Renaissance Drive

Las Vegas, Nevada 89119

(Address of principal executive offices)

 

+(61) 398464288

(Issuer’s telephone number, including area code)

 

Indicate by check mark whether the issuer (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act 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 ☒ No ☐

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (SS 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐

 

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 the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 if the Exchange Act.

 

Large Accelerated Filer Accelerated Filer
Non-accelerated Filer (Do not check if smaller reporting company) Smaller Reporting Company

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

 

APPLICABLE ONLY TO CORPORATE ISSUERS:

 

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

 

As of 21st September 2021, there were 737,087,103 shares of the registrant’s common stock outstanding and 38,000,000 shares of the registrant’s preferred stock

 

 

 

 
 

 

CAUTIONARY NOTE REGARDING EXPLORATION STAGE STATUS

 

We are considered an “exploration stage” company under the U.S. Securities and Exchange Commission (“SEC”) Industry Guide 7, Description of Property by Issuers Engaged or to be Engaged in Significant Mining Operations (“Industry Guide 7”), because we do not have reserves as defined under Industry Guide 7. Reserves are defined in Guide 7 as that part of a mineral deposit which can be economically and legally extracted or produced at the time of the reserve determination. The establishment of reserves under Guide 7 requires, among other things, certain spacing of exploratory drill holes to establish the required continuity of mineralization and the completion of a detailed cost or feasibility study.

 

Because we have no reserves as defined in Industry Guide 7, we have not exited the exploration stage and continue to report our financial information as an exploration stage entity as required under Generally Accepted Accounting Principles (“GAAP”). Although for purposes of FASB Accounting Standards Codification Topic 915, Development Stage Entities, we have exited the development stage and no longer report inception to date results of operations, cash flows and other financial information, we will remain an exploration stage company under Industry Guide 7 until such time as we demonstrate reserves in accordance with the criteria in Industry Guide 7.

 

Because we have no reserves, we have and will continue to expense all mine construction costs, even though these expenditures are expected to have a future economic benefit in excess of one year. We also expense our reclamation and remediation costs at the time the obligation is incurred. Companies that have reserves and have exited the exploration stage typically capitalize these costs, and subsequently amortize them on a units-of-production basis as reserves are mined, with the resulting depletion charge allocated to inventory, and then to cost of sales as the inventory is sold. As a result of these and other differences, our financial statements will not be comparable to the financial statements of mining companies that have established reserves and have exited the exploration stage.

 

FORWARD LOOKING STATEMENTS

 

This Quarterly Report on Form 10-Q, Financial Statements and Notes to Financial Statements contains forward-looking statements that discuss, among other things, future expectations and projections regarding future developments, operations and financial conditions. All forward-looking statements are based on management’s existing beliefs about present and future events outside of management’s control and on assumptions that may prove to be incorrect. If any underlying assumptions prove incorrect, our actual results may vary materially from those anticipated, estimated, projected or intended

 

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PART I – FINANCIAL INFORMATION

 

ITEM 1. FINANCIAL STATEMENTS

 

December 31, 2020

C O N T E N T S

 

Condensed Consolidated Statements of Operations 4
Condensed Consolidated Balance Sheets 5
Condensed Consolidated Statements of Cash Flows 6
Condensed Consolidated Statement of Stockholders’ Deficit 7
Notes to Condensed Consolidated Financial Statements 8

 

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CONSOLIDATED STATEMENT OF OPERATIONS

(Unaudited)

 

    Quarter ended December 31,     Quarter ended December 31,  
    2020     2019  
Net revenues     27,712       39,276  
Cost of sales     -7,413       -30,784  
Gross profit     20,299       8,492  
                 
Operating expenses:                
General and administrative                
General and administrative     -90,493       -158,513  
Total operating expenses     -90,493       158,513  
Profit/Loss from operations     -70,194       -150,021  
                 
Other income (expense):                
Interest income             -  
Amortisation of Debt Discount             -  
Interest expense     -42,808       -25,345  
Other income     -       -  
Change in fair value of derivative liabilities             -63,467  
Total other expense, net     -42,808       -88,812  
Profit/Loss before provision for income taxes     -113,002       -238,833  
Provision for income taxes     -       -  
Net profit/loss from operations     -113,002       -238,833  
Less: Loss attributable to non-controlling interest     6410       8,671  
Net profit/loss attributable to Holding Company     -106,592       -230,162  
Other Comprehensive Income/(Loss)                
Foreign Exchange Adjustment     -6497       -  
Comprehensive Loss     -113,089          
                 
Basic and diluted loss per common share   $ 0.00     $ 0.00  
Weighted average common shares outstanding basic and diluted     240,677,271       233,177,226  

 

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INTERIM CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

    December 31,     September 30,  
    2020     2020  
Current assets:                
Cash   $ 1,794     $ 1,448  
Trade Debtors     -       1,241  
Sundry Debtors     219       -  
GST receivables     70,302       67,041  
Total current assets     72,315       69,730  
                 
Total assets   $ 72,315     $ 69,730  
                 
Current liabilities:                
Accounts payable     -       -  
Accrued expenses     521,593       483,000  
Wages payable     2,305       2,392  
Loan from related party     2,844,100       2,770,739  
Total current liabilities     3,367,998       3,256,131  
                 
Stockholders’ deficit:                
Preferred stock, $0.001 par value; 50,000,000 shares authorized; 38,000,000 shares issues and outstanding     24,500       24,500  
Common stock, $0.001 par value; 2,000,000,000 shares authorized; 443,354,441 shares issued and outstanding     443,355       443,355  
Additional paid-in capital     10,092,518       10,092,518  
Accumulated deficit     -13,690,204       -13,577,116  
Total stockholders’ deficit, including non-controlling interest     -3,129,831       -3,016,744  
Non-Controlling interest     -165,852       -159,441  
Total stockholders’ deficit     -3,295,683       -3,176,185  
Total liabilities and stockholders’ deficit   $ 72,315     $ 69,730  

 

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CONSOLIDATED STATEMENT OF CASH FLOWS

(Unaudited)

 

   

3 months ended

December 31 ,

2020

   

3 months ended

December 31,

2019

 
Operating Activities:                
Net loss     -113,002       -230,162  
                 
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:                
Depreciation and amortization     -       2,695  
Change in fair value of derivative instruments     -       63,469  
Changes in operating assets and liabilities:                
Other assets     -3261       -  
Accounts receivable     1241       -15,929  
Accrued expenses     6,000       62,500  
Accrued interest     42,808       25,345  
Deposits             -  
Net cash used in operating activities     -66,214       -92,082  
                 
Cash flows from investing activities:                
Purchase of property and equipment     -       -3,195  
Net cash used in investing activities     -       -3,195  
Cash flows from financing activities:                
Proceeds from related party loans, net of debt discounts     66,569       95,953  
Net cash provided by financing activities     66,569       95,953  
Foreign currency translation adjustment     -9       -228  
Net change in cash     346       674  
Cash, beginning of period     1,448       2,223  
Cash, end of period     1,794       2,669  

 

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KIBUSH CAPITAL CORPORATION

CONSOLIDATED STATEMENT OF STOCKHOLDERS’ DEFICIT

for the period SEPTEMBER 30, 2020, December 31, 2020

(Unaudited)

 

    Common Stock     Preferred Stock     Paid In    

Non-

Controlling

    Accumulated    

Accumulated

Other Comprehensive

    Stockholders’  
    Shares     Amount     Shares     Amount     Capital    

Interest

   

Deficit

   

Income

    Deficit  
Balance at September 30, 2019     443,354,541       443,355       23,000,000       23,000       9,842,517       -122,996       -13,728.369             -       -3,542,493  
                                                                         
101 Series C Preferred Shares issued for repayment of back salary at $0.001 per share     -       -       15,000       1,500       -       -       -       -       1,500  
Exchange rate variation
Write back accruals
    -       -       -       -       250,001       -       -       -       250,001  
Net loss     -       -       -       -       -       -36,445       -151,252       -       114,808  
                                                                         
Balance at September 30, 2020     443,354,541       443,355       38,000,000       24,500       10,092,518       -159,441       -13,577,116       -       -3,176,184  
101 Series C Preferred Shares issued for repayment of back salary at $0.001 per share     -       -       -       -               -       -       -          
Exchange rate variation     -       -       -       -       -       -       -6497       -       -6497  
Net loss     -       -       -       -       -       -6,410       -106,592       -       -113,002  
                                                                         
Balance at December 31, 2020     443,354,541       443,355       38,000,000       24,500       10,092,518       -165,852       -13,690,204       -       -3,295,683  

 

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NOTE 1 - CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

Business

 

Kibush Capital Corporation (formerly David Loren Corporation) (the “Company”) includes its 90% owned subsidiary Aqua Mining (PNG). See Basis of Presentation below. The Company has two primary businesses: (i) mining exploration within Aqua Mining, and (ii) timber operations in Papua New Guinea by Aqua Mining.

 

Basis of Presentation

 

The Company maintains its accounting records on an accrual basis in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”).

 

The consolidated financial statements of the Company include the accounts of the Company, and all entities in which a direct or indirect controlling interest exists through voting rights or qualifying variable interests. All intercompany balances and transactions have been eliminated in the consolidated financial statements.

 

Certain information and disclosures normally included in the notes to financial statements have been condensed or omitted as permitted by the rules and regulations of the Securities and Exchange Commission, although the Company believes the disclosure is adequate to make the information presented not misleading. The accompanying unaudited financial statements should be read in conjunction with the financial statements of the Company for the year ended September 30, 2019.

 

Change in Fiscal Year End

 

The Company’s fiscal year end is from October 1 to September 30 of each year.

 

Going Concern

 

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the liquidation of liabilities in the normal course of business. As at December 31, 2020, the Company has an accumulated deficit of $13,690,204 and $13,577,116 as of September 30, 2020 and has not earned sufficient revenues to cover operating costs since inception and has a working capital deficit. The Company intends to fund its mining exploration through equity financing arrangements, which may be insufficient to fund its capital expenditures, working capital and other cash requirements for the year.

 

The ability of the Company to emerge from the development stage is dependent upon, among other things, obtaining additional financing to continue mining exploration and execution of its business plan. In response to these problems, management intends to raise additional funds through public or private placement offerings.

 

These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

Functional and Reporting Currency

 

The consolidated financial statements are presented in U.S. Dollars. The Company’s functional currency is the U.S. Dollar. The functional currency of Aqua Mining is the Papua New Guinean kina. Assets and liabilities are translated using the exchange rate on the respective balance sheet dates. Items in the income statement and cash flow statement are translated into U.S. Dollars using the average rates of exchange for the periods involved. The resulting translation adjustments are recorded as a separate component of other comprehensive income/(loss) within stockholders’ equity.

 

The functional currency of foreign entities is generally the local currency unless the primary economic environment requires the use of another currency. Gains or losses arising from the translation or settlement of foreign-currency-denominated monetary assets and liabilities into the functional currency are recognized in the income in the period in which they arise. However, currency differences on intercompany loans that have the nature of a permanent investment are accounted for as translation differences as a separate component of other comprehensive income/(loss) within stockholders’ equity.

 

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

A summary of the principal accounting policies are set out below:

 

Cash

 

The Company maintains its cash balances in interest and non-interest-bearing accounts which do not exceed Federal Deposit Insurance Corporation limits.

 

Principles of Consolidation

 

The accompanying consolidated financial statements include the accounts of Kibush Capital and Aqua Mining. All intercompany accounts and transactions have been eliminated.

 

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Other Comprehensive Income and Foreign Currency Translation

 

FASB ASC 220-10-05, Comprehensive Income, establishes standards for the reporting and display of comprehensive income and its components in a full set of general-purpose financial statements. Comprehensive income is defined to include all changes in equity except those resulting from investments by owners and distribution to owners.

 

The accompanying consolidated financial statements are presented in United States dollars.

 

Use of Estimates

 

The preparation of financial statements in conformity with Generally Accepted Accounting Principles in the United States of America (“GAAP”) requires management to make certain 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. Significant estimates made by management are, recoverability of long-lived assets, valuation and useful lives of intangible assets, valuation of derivative liabilities, and valuation of common stock, options, warrants and deferred tax assets. Actual results could differ from those estimates.

 

Non-Controlling Interests

 

Investments in associated companies over which the Company has the ability to exercise significant influence are accounted for under the consolidation method, after appropriate adjustments for intercompany profits and dividends.

 

In December 2007, the FASB issued SFAS No. 141(R), “Business Combinations.” It requires an acquirer to recognize, at the acquisition date, the assets acquired, the liabilities assumed, and any non-controlling interest in the acquiree at their full fair values as of that date. In a business combination achieved in stages (step acquisitions), the acquirer will be required to re-measure its previously held equity interest in the acquiree at its acquisition-date fair value and recognize the resulting gain or loss in earnings. The acquisition-related transaction and restructuring costs will no longer be included as part of the capitalized cost of the acquired entity but will be required to be accounted for separately in accordance with applicable generally accepted accounting principles. U.S. SFAS No. 141(R) applies prospectively to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008.

 

A non-controlling interest in a subsidiary is an ownership interest in a consolidated entity that is reported as equity in the consolidated financial statements and separate from the Company’s equity. In addition, net income/(loss) attributable to non-controlling interests is reported separately from net income attributable to the Company in the consolidated financial statements. The Company’s consolidated statements present the full amount of assets, liabilities, income and expenses of all of our consolidated subsidiaries, with a partially offsetting amount shown in non-controlling interests for the portion of these assets and liabilities that are not controlled by us.

 

Property and Equipment

 

Property and equipment are stated at cost. Depreciation is computed using the straight-line method over estimated useful lives as follows:

 

Plant equipment   2 to 15 years
Motor Vehicle   4 to 15 years

 

Maintenance and repairs are charged to expense as incurred. Renewals and improvements of a major nature are capitalized. At the time of retirement or other disposition of property and equipment, the cost and accumulated depreciation are removed from the accounts and any resulting gains or losses are reflected in the consolidated statement of operations.

 

Impairment of Long-Lived Assets

 

In accordance with FASB ASC 360-10-5, Accounting for the Impairment or Disposal of Long-Lived Assets, the Company evaluates the carrying value of its long-lived assets for impairment whenever events or changes in circumstances indicate that such carrying values may not be recoverable. The Company uses its best judgment based on the current facts and circumstances relating to its business when determining whether any significant impairment factors exist. The Company considers the following factors or conditions, among others, that could indicate the need for an impairment review:

 

    Significant under performance relative to expected historical or projected future operating results.
    Significant changes in its strategic business objectives and utilization of the assets.
    Significant negative industry or economic trends, including legal factors.

 

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If the Company determines that the carrying values of long-lived assets may not be recoverable based upon the existence of one or more of the above indicators of impairment, the Company’s management performs an undiscounted cash flow analysis to determine if impairment exists. If impairment exists, the Company measures the impairment based on the difference between the asset’s carrying amount and its fair value, and the impairment is charged to operations in the period in which the long-lived asset impairment is determined by management.

 

During the year ended September 30, 2020, the Aqua Mining business continued to generate material operating losses. Consequently, management has re-assessed the carrying value of the existing plant and equipment and its ability to generate positive cash flows over the remaining useful life of the group of assets used within the Timber milling business. Managements current assessment, which takes into consideration the ongoing uncertain impacts of COVID-19 on market supply chains and the access to equipment required for timber processing facility enhancements, indicates that the current group of assets are impaired and need to be written down to a carrying value indicative representative of fair value. Managements current assessment of the carrying value is nil as there is no reliable secondary market at present for these assets in the Port Moresby region combined with other market constraints relating to COVID-19 impacts on supply chains. Management will continue to explore opportunities to expand the supply and processing capacity of the timber milling process with a view to re-assessing the carrying value of the asset group should positive operating cash flows start to be generated in future periods.

 

The carrying value of the Company’s investment in Joint Venture contract with leaseholders of certain Mining Leases in Papua New Guinea represents its ownership, accounted for under the equity method. The ownership interest is not adjusted to fair value on a recurring basis. Each reporting period the Company assesses the fair value of the Company’s ownership interest in Joint Venture in accordance with FASB ASC 325-20-35. Each year the Company conducts an impairment analysis in accordance with the provisions within FASB ASC 320-10-35 paragraphs 25 through 32.

 

Fair Value of Financial Instruments

 

The carrying amounts of the Company’s cash, accounts payable and accrued expenses approximate their estimated fair values due to the short-term maturities of those financial instruments. The Company believes the carrying amount of its notes payable approximates its fair value based on rates and other terms currently available to the Company for similar debt instruments

 

Beneficial Conversion Features of Debentures

 

In accordance with FASB ASC 470-20, Accounting for Convertible Securities with Beneficial Conversion Features or Contingently Adjustable Conversion Ratios, we recognize the advantageous value of conversion rights attached to convertible debt. Such rights give the debt holder the ability to convert debt into common stock at a price per share that is less than the trading price to the public on the day the loan is made to us. The beneficial value is calculated as the intrinsic value (the market price of the stock at the commitment date in excess of the conversion rate) of the beneficial conversion feature of debentures and related accruing interest is recorded as a discount to the related debt and an addition to additional paid in capital. The discount is amortized over the remaining outstanding period of related debt using the interest method.

 

Loss per Share

 

The Company applies FASB ASC 260, “Earnings per Share.” Basic earnings (loss) per share is computed by dividing earnings (loss) available to common stockholders by the weighted-average number of common shares outstanding. Diluted earnings (loss) per share is computed similar to basic earnings (loss) per share except that the denominator is increased to include additional common shares available upon exercise of stock options and warrants using the treasury stock method, except for periods for which no common share equivalents are included because their effect would be anti-dilutive.

 

Income Taxes

 

Income taxes are accounted for in accordance with ASC Topic 740, “Income Taxes.” Under the asset and liability method, deferred tax assets and liabilities are recognized for the future consequences of differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases (temporary differences). Deferred tax assets and liabilities are measured using tax rates expected to apply to taxable income in the years in which those temporary differences are recovered or settled. Valuation allowances for deferred tax assets are established when it is more likely than not that some portion or all of the deferred tax assets will not be realized.

 

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Mineral Property, Mineral Rights (Claims) Payments and Exploration Costs

 

Pursuant to EITF 04-02, “Whether Mineral Rights are Tangible or Intangible Assets and Related Issues”, the Company has an accounting policy to capitalize the direct costs to acquire or lease mineral properties and mineral rights as tangible assets. The direct costs include the costs of signature (lease) bonuses, options to purchase or lease properties, and brokers’ and legal fees. If the acquired mineral rights relate to unproven properties, the Company does not amortize the capitalized mineral costs, but evaluates the capitalized mineral costs periodically for impairment. The Company expenses all costs related to the exploration of mineral claims in which it had secured exploration rights prior to establishment of proven and probable reserves.

 

Accounting Treatment of Mining Interests

 

At this time, the Company does not directly own or directly lease mining properties. However, the Company does have contractual rights and governmental permits which allow the Company to conduct mining exploration on the properties referenced in this report. These contractual relationships, coupled with the government permits issued to the Company (or a subsidiary), are substantially similar in nature to a mining lease. Therefore, we have treated these contracts as lease agreements from an accounting perspective.

 

Research and Development

 

Research and development costs are recognized as an expense in the period in which they are incurred. The Company incurred no research and development costs for the quarter ended December 31, 2020.

 

Recent Accounting Pronouncements

 

In October 2018, FASB issued Accounting Standards Update 2018-16, Derivaties and Hedging (Topic 805): Inclusion of the Secured Overnight Financing Rate (SOFR) Overight Index Swap (OIS) Rate as a Benchmark Interest Rate for Hedge Accounting Purposes. The ASU amends ASC 815 to add the OIS rate based on the SOFR as a fifth US benchmark interest rate. We do not expect the adoption of this ASU to have a material effect on our consolidated financial statements.

 

In October 2018, FASB issued Accounting Standards Update 2018-17: Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest Entities. This standard expands the application of a specific private company accounting alternative related to VIEs and changes the guidance for determining whether a decision-making fee is a variable interest. We do not expect the adoption of this ASU to have a material effect on our consolidated financial statements.

 

In November 2018, FASB issued Accounting Standards Update 2018-18, Collaborative Arrangements (Topic 808): Clarifying the Interaction between Topic 808 and Topic 606. The ASU amends ASC 808 to clarify ASC 606 should apply in entirety to certain transactions between collaborative arrangement participants. We do not expect the adoption of this ASU to have a material effect on our consolidated financial statements.

 

In November 2018, FASB issued Accounting Standards Update 2018-19, Codification Improvements to Topic 326, Financial Instruments—Credit Losses. The ASU changes the effective date of ASU 2016-13 to fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. Thus, the effective date for such entities’ annual financial statements is now aligned with that for these interim financial statements. We are currently evaluating the impact that the standard will have on our consolidated financial statements and related disclosures.

 

In December 2018, FASB issued Accounting Standards Update 2018-20, Leases (Topic 842): Narrow-Scope Improvements for Lessors. The amendments are designed to make lessors adoption of the new leases standard easier such as accounting policy election on sales tax, exclude variable payments for all lessor costs, and clarification on lessor costs. We are currently evaluating the impact that the standard will have on our consolidated financial statements and related disclosures.

In March 2019, FASB Issued Accounting Standards Update 2019-01, Leases (Topic 842): Codification Improvements. For public business entities, the amendments in this Update are effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. We do not expect the adoption of this ASU to have a material effect on our consolidated financial statements.

 

In March 2019, FASB Issued Accounting Standards Update 2019-02: Improvements to Accounting for Costs of Films and License Agreements for Program Materials. For public business entities, the amendments in this Update are effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. We do not expect the adoption of this ASU to have a material effect on our consolidated financial statements.

 

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In March 2019, FASB Issued Accounting Standards Update 2019-03, Not-for-Profit Entities (Topic 958): Updating the Definition of Collections (Topic 958). We do not expect the adoption of this ASU to have a material effect on our consolidated financial statements as the ASU is applicable to not-for-profit entities.

 

In April 2019, FASB Issued Accounting Standards Update 2019-04 Codification Improvements to Topic 326, Financial Instruments—Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments. The ASU 2019-04 clarifies and improves guidance within the recently issued standards on credit losses, hedging, and recognition and measurement of financial instruments: The effective dates for amendments related to ASUs 2016-13 and 2017-12 align with the effective dates of those standards, unless an entity has already adopted one or both. We do not expect the adoption of this ASU to have a material effect on our consolidated financial statements.

 

In May 2019, FASB Issued Accounting Standards Update 2019-05, Targeted Transition Relief. ASU 2019-05 provides transition relief for ASU 2016-13 (“credit losses standard”) by providing entities with an alternative to irrevocably elect the fair value option for eligible financial assets measured at amortized cost upon adoption of the new credit losses standard. For entities that have not yet adopted ASU 2016-13, the effective dates are the same as those in ASU 2016-13. For entities that have adopted ASU 2016-13, ASU 2019-05 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted once ASU 2016-13 has been adopted. We do not expect the adoption of this ASU to have a material effect on our consolidated financial statements.

 

In May 2019, FASB Issued Accounting Standards Update 2019-06, Extending the Private Company Accounting Alternatives on Goodwill and Certain Identifiable Intangible Assets to Not-for-Profit Entities. The amendments are affective upon issuance of the ASU. We do not expect the adoption of this ASU to have a material effect on our consolidated financial statements.

 

In November 2019, the ASB issued Accounting Standards Update 2019-08-Compensation-Stock Compensation (Topic 718) and Revenue from Contracts with Customers (Topic 606): Codification Improvements-Share-Based Consideration Payable to a Customer. This ASU will affect companies that issue share-based payments (e.g., options or warrants) to their customers. Similar to issuing a cash rebate to a customer, issuing a share-based payment to a customer can incentivize additional purchases. The share-based payments can also serve a strategic purpose by aligning the interests of a supplier and its customer, because the customer’s additional purchases increase its investment in the supplier. For entities that have not yet adopted the amendments in Update 2018-07, the amendments in this update are effective in fiscal years beginning after December 15, 2019. We do not expect the adoption of this ASU to have a material effect on our consolidated financial statements.

 

In November 2019, the FASB issued Accounting Standards Update 2019-09-Financial Services-Insurance (Topic 944). This ASU will affect companies that issue share-based payments (e.g., options or warrants) to their customers. Similar to issuing a cash rebate to a customer, issuing a share-based payment to a customer can incentivize additional purchases. The share-based payments can also serve a strategic purpose by aligning the interests of a supplier and its customer, because the customer’s additional purchases increase its investment in the supplier. The amendments in this Update are effective in fiscal years beginning after December 15, 2021. We do not expect the adoption of this ASU to have a material effect on our consolidated financial statements.

 

In November 2019, the FASB issued Accounting Standards Update 2019-10-Financial Instruments-Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842): Effective Dates. This ASU discusses the FASB’s proposed ASU Codification Improvements to Hedge Accounting, which would clarify certain amendments made by ASU 2017-12, Targeted Improvements to Accounting for Hedging Activities, to the guidance in ASC 815 on hedging activities. The FASB issued the proposal in response to feedback and questions received from stakeholders related to their implementation of ASU 2017-12. The ASU also discusses the recent issuance of FASB ASU No. 2019-10, Financial Instruments – Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842): Effective Dates. The ASU provides a framework to stagger effective dates for future major accounting standards and amends the effective dates for certain major new accounting standards to give implementation relief to certain types of entities. Specifically, ASU 2019-10 changes some effective dates for ASU 2017-12 on hedging, ASU 2016-02 on leasing, ASU 2016-13 on current expected credit losses, and ASU 2017-04 on simplifying the goodwill impairment test. The amendments in this Update amend the mandatory effective dates Credit Losses for all entities as follows or fiscal years beginning after December 15, 2019. The effective dates for Hedging after applying this update are as follows: for fiscal years beginning after December 15, 2018. The effective dates for Leases after applying this Update are as follows for fiscal years beginning after December 15, 2018. We do not expect the adoption of this ASU to have a material effect on our consolidated financial statements.

 

In December 2019, the FASB issued Accounting Standards Update 2019-12-Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. This ASU summarizes the FASB’s recently issued Accounting Standards Update (ASU) No. 2019-12, simplifying the Accounting for Income Taxes. The ASU enhances and simplifies various aspects of the income tax accounting guidance in ASC 740. The amendments in this update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. We do not expect the adoption of this ASU to have a material effect on our consolidated financial statements.

 

- 12 -
 

 

In January 2020, the FASB issued Accounting Standards Update 2020-01-Investments-Equity Securities (Topic 321), Investments-Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815)-Clarifying the Interactions between Topic 321, Topic 323, and Topic 815. This ASU clarifies the interaction between accounting standards related to equity securities (ASC 321), equity method investments (ASC 323), and certain derivatives (ASC815). The amendments in this Update are effective for fiscal years beginning after December 15, 2020. We do not expect the adoption of this ASU to have a material effect on our consolidated financial statements.

 

In March 2020, the FASB issued Accounting Standards Update 2020-03-Codification Improvements to Financial Instruments. The Standard is part of FASB’s ongoing project to improve and clarify its Accounting Standards Codification and avoid unintended application. The items addressed are not expected to significantly affect current practice or create a significant administrative cost for most entities. The amendment is divided into issues 1 to 7 with different effective dates as follows: The amendments related to Issue 1, Issue 2, Issue 4, and Issue 5 are conforming amendments. For public business entities, the amendments are effective upon issuance of this update. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years beginning after December 15, 2020. The amendment related to Issue 3 is a conforming amendment that affects the guidance related to the amendments in 2016-01, Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. The effective date of this update for the amendments to Update 2016-01 is for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. For entities that have not yet adopted the amendments related to Update 2016-13, the effective dates and the transition requirements for these amendments are the same as the effective date and transition requirements in Update 2016-13. For entities that have adopted the guidance in Update 2016-13, the amendments are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. For those entities, the amendments should be applied on a modified-retrospective basis by means of a cumulative-effect adjustment to opening retained earnings in the statement of financial position as of the date that an entity adopted the amendments in Update 2016-13. We do not expect the adoption of this ASU to have a material effect on our consolidated financial statements.

 

Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on our consolidated financial statements upon adoption.

 

NOTE 3 – INVESTMENTS IN SUBSIDIARIES

 

The Company owns interests in the following entities which was recorded at their book value since they were related party common control acquisitions.

 

    Investment     Ownership %  
                 
Aqua Mining (PNG)     34       90 %


 

As Aqua Mining (PNG) Ltd was acquired from a related entity, Five Arrows Limited (see Note 10 – Business Combinations), the shares were recorded in the accounts at their true cost value.

 

NOTE 4 – PROPERTY AND EQUIPMENT

 

    December 31, 2020     September 30, 2020  
             
Plant Equipment     113,515       113,515  
Motor Vehicle     111,585       111,585  
      225,100       225,100  
Less Accumulated Depreciation     -97,280       -97,280  
Less Provision for Impairment     -127,820       -127820  
  $ 0     $ 0  

 

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NOTE 5 – LOAN FROM RELATED PARTY

 

Convertible Notes Issued to the President and Director of Kibush Capital Corporation:

 

    December 30, 2020  
   

Note face

amount

    Debt
Discount
    Net Amount
of note
 
                   
Loan from related party   $ 2,844,100     $ 0     $ 2,844,100  
                         
Total   $ 2,844,100     $     0     $ 2,844,100  

 

    September 30, 2020  
   

Note face

amount

    Debt
Discount
    Net Amount
of note
 
                   
Loan from related party   $ 2,770,739     $ 0     $ 2,770,739  
                         
Total   $ 2,770,739     $      0     $ 2,770,739  

 

On January 16, 2020, the Company entered into a Promissory Note Consolidation Agreement (the “Consolidation Agreement”) with one of its noteholders, Warren Sheppard., as lender (“Mr. Sheppard”). Pursuant to the terms of the Consolidation Agreement, the Company consolidated an aggregate of $1,358,692 of outstanding debt obligations (the “Outstanding Debt”), which included principal and interest, owed to Mr. Sheppard by the Company.

 

Upon the assumption by the Company of the Outstanding Debt, the Company and Mr. Sheppard entered into an unsecured promissory note (the “Consolidated Note”), which such Consolidated Note restated the repayment terms and conditions of the Outstanding Debt in full. Pursuant to the terms and conditions of the Consolidated Note, the Outstanding Debt accrues simple interest at 12.5% per year, compounded annually, and the Consolidated Note has a maturity date of January 15, 2022. No regularly scheduled periodic payments of principal or interest are due under the Consolidated Note, and, unless there is an earlier event of default, all outstanding and unpaid principal and interest under the Consolidated Note is due and payable in a single lump sum payment at maturity. The Consolidated Note also removes any common stock conversion features from previous notes. The Company may prepay the Consolidated Note at any time prior to maturity without penalty.

 

As a consequence of the debt consolidation, the derivative Liabilities associated with option component has been eliminated, therefore, derivative liabilities amounted to $728,080 as of the debt consolidation date are subsequently reversed and charged into profit and losses in January 2020.

 

As at December 30,2020 the Related Party Loans of $2,844,100 comprises Consolidation Note $1,358,692 and an unsecured loan of $1,485,408.27.

 

Mr Sheppard has provided a letter of comfort to the company stating that he will not request repayment of the loan, for a period of not less than 12 months, from the date of signing the 10 K accounts.

 

- 14 -
 

 

NOTE 6 – STOCKHOLDER’S DEFICIT

 

Common Stock

 

On August 22, 2013, the Company’s Board authorized a 225:1 reverse stock split. All share and per share data in the accompanying financial statements and footnotes has been adjusted retrospectively for the effects of the stock split.

 

On October 12, 2013, the Company issued by director’s resolution, 10,000,000 shares of newly issued common stock for the purchase of a Memorandum of Understanding (dated September 2, 2013) from a related company (Five Arrows Limited); which gave Kibush Capital Corporation the right to acquire 80% ownership in Instacash Pty Ltd, an Australian Currency Services provider, and corporate trustee of the Instacash Trust. As this transaction was with a related party, the value was recorded at the par value of the stock i.e. $0.001 per share of common stock.

 

Between October 23, 2013 and September 30, 2014, the Company issued a total of 3,274,000 shares of common stock upon the requests from convertible note holders to convert principal totaling $3,274 into the Company’s common stock based on the terms set forth in the loans. The conversion rate was $0.001.

 

On February 28, 2014, the Company issued by director’s resolution, 40,000,000 shares of newly issued common stock to conclude a Assignment and Bill of Sale (dated February 14, 2014) from a related company (Five Arrows Limited); which gave Kibush Capital Corporation the right to enter into a Joint Venture contract with the leaseholders of certain Mining Leases in Papua New Guinea. As this transaction was with a related party, the value was recorded at par value of the stock i.e. $0.001 per share of common stock.

 

Between November 1, 2014 and March 31, 2015, the Company issued a total of 4,560,000 shares of common stock upon the requests from convertible note holders to convert principal totaling $3,274 into the Company’s common stock based on the terms set forth in the loans. The conversion rate was $0.001.

 

Between April 1, 2016 and September 30, 2016, the Company issued a total of 190,114,175 shares of common stock upon the requests from convertible note holders to convert principal totaling $190,114 into the Company’s common stock based on the terms set forth in the loans. The conversion rate was $0.001.

 

Between October 1, 2016 and December 31, 2016, the Company issued a total of 208,879,614 shares of common stock upon the requests from convertible note holders to convert principal totaling $208,880 into the Company’s common stock based on the terms set forth in the loans. The conversion rate was $0.001.

 

Between January 1, 2017 and March 31, 2017, the Company issued a total of 9,375,000 shares of common stock upon the requests from convertible note holders to convert principal totaling $9,375 into the Company’s common stock based on the terms set forth in the loans. The conversion rate was $0.001.

 

Between April 1, 2017 and June 30, 2017, the Company issued a total of 405,000,000 shares of common stock upon the requests from convertible note holders to convert principal totaling $405,000 into the Company’s common stock based on the terms set forth in the loans. The conversion rate was $0.001.

 

On August 23, 2017, the Company’s Board authorized a 1:25 reverse stock split. All share and per share data in the accompanying financial statements and footnotes has been adjusted retrospectively for the effects of the stock split.

 

Between October 1, 2017 and December 31, 2017, the Company issued a total of 180,395,000 shares of common stock upon the requests from convertible note holders to convert principal totaling $180,395 into the Company’s common stock based on the terms set forth in the loans. The conversion rate was $0.001.

 

Between January 1, 2018 and March 31, 2018, the Company issued a total of 139,000,000 shares of common stock upon the requests from convertible note holders to convert principal totaling $139,000 into the Company’s common stock based on the terms set forth in the loans. The conversion rate was $0.001.

 

Between April 1, 2018 and June 30, 2018, the Company issued a total of 120,000,000 shares of common stock upon the requests from convertible note holders to convert principal totaling $120,000 into the Company’s common stock based on the terms set forth in the loans. The conversion rate was $0.001.

 

Preferred Stock

 

Preferred stock includes 50,000,000 shares authorized at $0.001 par value, of which 10,000,000 have been designated Series A and 25,000,000 designated as Series B. A total of 3,000,000 shares of Series A preferred stock are issued and outstanding as of December 30, 2020, and September 30, 2020. A total of 34,999,899 shares of Series B preferred stock were outstanding as of December 31, 2020, and a total of 101 Series C Preference Shares are issued and outstanding as of December 31, 2020.

 

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Issued Preference Share B

 

On January 9, 2020, the Board of Directors, with the approval of a majority vote of the shareholders approved the filing of a Certificate of Amendment of Designation of the Company’s Series B Preferred Stock (“Series B Preferred Stock”). The Board of Directors authorized the increase of authorized shares of the Series B Preferred Stock to 37,999,899 shares by filing the Certificate of Amendment of Designation with the Nevada Secretary of State. The terms of the Certificate of Amendment of Designation of the Series B Preferred Stock, which was filed and approved by the State of Nevada on January 9, 2020, have not otherwise changed as previously filed and disclosed.

 

Issued Preference Share C

 

On January 9, 2020, the Board of Directors, with the approval of a majority vote of the shareholders approved the filing of a Certificate of Amendment of Designation of the Company’s Series C Preferred Stock (“Series C Preferred Stock”). The Board of Directors authorized the increase of authorized shares of the Series C Preferred Stock to 101 shares by filing the Certificate of Amendment of Designation with the Nevada Secretary of State. The terms of the Certificate of Amendment of Designation of the Series C Preferred Stock, which was filed and approved by the State of Nevada on January 9, 2020, have not otherwise changed as previously filed and disclosed.

 

NOTE 7 – INCOME TAXES

 

The provision/(benefit) for income taxes for the 3 months ended December 31, 2020 and the year ended September 30, 2020 was as follows (assuming a 15% effective tax rate).

 

      3 months ended December 31,       September 30,  
      2020       2020  
Current Tax Provision                
Federal-                
Taxable Income     -       -  
Total current tax provisions     -       -  
    $ -     $ -  
                 
Deferred Tax Provision                
Federal-                
Loss carry forwards   $ -     $ -  
Change in valuation allowance   $ -   $ -
Total deferred tax provisions   $ -     $ -  

 

As of September 30, 2020, the Company had approximately $13,577,116 in tax loss carry forwards that can be utilized future periods to reduce taxable income, and the carry forward incurred for the year ended September 30, 2020 will expire by the year 2035.

 

As of December 31, 2020, the Company had approximately $13,690,204 in tax loss carry forwards that can be utilized future periods to reduce taxable income, and the carry forward incurred for the year ended September 30, 2021 will expire by the year 2036.

 

The Company did not identify any material uncertain tax positions. The Company did not recognize any interest or penalties for unrecognized tax benefits.

 

The federal income tax returns of the Corporation are subject to examination by the IRS, generally for three years after they are filed.

 

- 16 -
 

 

NOTE 8 – RELATED PARTY TRANSACTIONS

 

Details of transactions between the Corporation and related parties are disclosed below.

 

The following transactions were carried out with related parties:

 

    December 30, 2020     September 30, 2020  
             
Loan from related party   $ 2,844,100     $ 2,770,739  
                 
Total   $ 2,844,100     $ 2,770,739  

 

(a) From time to time, the president and stockholder of the Company provides advances to the Company for its working capital purposes. These advances bear no interest and are due on demand.

 

(b) See Note 6 for details of Convertible notes.

 

(c) On January 9th, 2020, the Company issued Mr Sheppard 14,999,899 Class B Preference Shares and 101 Class C Preference Shares in full satisfaction of his unpaid 2015 and 2016 Salary of $250,000.

 

NOTE 9 – BUSINESS COMBINATIONS

 

Set out below are the controlled and non-controlled members of the group as of December 31, 2019, which, in the opinion of the directors, are material to the group. The subsidiaries as listed below have share capital consisting solely of ordinary shares, which are held directly by the Company; the country of incorporation is also their principal place of business.

 

Name of Entity   Country of Incorporation   Acquisition Date   Voting Equity Interests  
Aqua Mining (PNG) Ltd   Papua New Guinea   28-Feb-2014     90 %

 

NOTE 10 – LEGAL PROCEEDINGS

 

We are not presently a party to any litigation.

 

NOTE 11 - CONTINGENT LIABILITIES

 

None.

 

- 17 -
 

 

NOTE 12 – SUBSEQUENT EVENTS

 

S-1 Registered Shares Issued.

 

Under the terms and conditions of the S-1 effective as from August 7th 2019,

Shares issued and Amounts raised as below.

 

Date   Shares Subscribed           Proceeds $  
January 6 2021     22,123,392       0.0015       33185  
February 10 2021     23,237,347       0.0015       34856  
March 17 2021     48,381,823       0.0015       72573  
April 12 2021     50,000,000       0.0015       75000  
May 18 2021     50,000,000       0.0015       75000  
July 5 2021     50,000,000       0.0015       75000  
                         
      243,742,562               365614  

 

Executive Employment

 

On February 10, 2020, Kibush Capital Corp., a Nevada corporation (the “Company”) entered into an Employment Agreement (the “Agreement”) with Warren Sheppard (“Mr. Sheppard”) an individual. Pursuant to the terms and conditions of the Agreement, Mr. Sheppard shall continue to serve as the Company’s President, Chief Executive Officer, Chief Financial Officer, Principal Financial Officer and a member of the Board of Directors and shall assume such other positions as reasonably requested by the Board of Directors, commencing on January 1, 2020 for a term of Four (4) years, and shall have the option to be renewed for an additional one (1) year unless earlier terminated. In exchange for his services, Mr. Sheppard shall receive a yearly salary of $24,000.

 

COVID-19 pandemic

 

The COVID-19 pandemic announced by the World Health Organisation post 31 January 2020 is having negative impact on the world economy. We have witnessed unprecedented measures implemented by the government on strict border security requirements. It is likely to have a significant impact on the Company’s export sales and associated supply chains. However, at this point of time, the impact of COVID-19 is unknown and cannot be quantified. We expect our business to remain in operation but will manage the unavoidable disruptions to our best abilities.

 

NOTE 13 – INVENTORY

 

Inventories are valued at cost. Cost is determined using the first-in, first-out method. The cost of finished goods and work-in-progress comprises raw materials, direct labour, other direct costs, and related production overheads (based on normal operating capacity) but excludes borrowing costs. There are three types of inventories in three stages of completion. Raw materials comprise of logs that are on the ground and at the log pond; Work-in-progress comprise of rough sawn timber at the Rigo site whilst Finished goods are planed, straightened timber at Laloki for sale. Each would have a different wholesale value depending on the level of processing. The stock levels held as raw materials and finished goods are minimal, and the saleable condition of the finished timber is questionable and unable to be accurately valued therefore we have written stock down to nil net realizable value

 

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION.

 

Cautionary Notice Regarding Forward Looking Statements

 

The information contained in Item 2 contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Actual results may materially differ from those projected in the forward-looking statements as a result of certain risks and uncertainties set forth in this report. Although management believes that the assumptions made and expectations reflected in the forward-looking statements are reasonable, there is no assurance that the underlying assumptions will, in fact, prove to be correct or that actual results will not be different from expectations expressed in this report.

 

This filing contains a number of forward-looking statements which reflect management’s current views and expectations with respect to our business, strategies, products, future results and events, and financial performance. All statements made in this filing other than statements of historical fact, including statements addressing operating performance, events, or developments which management expects or anticipates will or may occur in the future, including statements related to distributor channels, volume growth, revenues, profitability, new products, adequacy of funds from operations, statements expressing general optimism about future operating results, and non-historical information, are forward looking statements. In particular, the words “believe,” “expect,” “intend,” “anticipate,” “estimate,” “may,” variations of such words, and similar expressions identify forward-looking statements, but are not the exclusive means of identifying such statements, and their absence does not mean that the statement is not forward-looking. These forward-looking statements are subject to certain risks and uncertainties, including those discussed below. Our actual results, performance or achievements could differ materially from historical results as well as those expressed in, anticipated, or implied by these forward-looking statements. We do not undertake any obligation to revise these forward-looking statements to reflect any future events or circumstances.

 

Readers should not place undue reliance on these forward-looking statements, which are based on management’s current expectations and projections about future events, are not guarantees of future performance, are subject to risks, uncertainties and assumptions (including those described below), and apply only as of the date of this filing. Our actual results, performance or achievements could differ materially from the results expressed in, or implied by, these forward-looking statements. Factors which could cause or contribute to such differences include, but are not limited to, the risks to be discussed in our Annual Report on Form 10-K and in the press releases and other communications to shareholders issued by us from time to time which attempt to advise interested parties of the risks and factors which may affect our business. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

 

Overview

 

Kibush Capital Corp. (the “Company”, “We”, or “Us”) is an exploration stage company as defined by the Security and Exchange Commission’s (“SEC”) Industry Guide 7 as the Company has no established reserves as required under the Industry Guide 7. The Company is undertaking mineral exploration activities in Australia and Papua New Guinea. Our business is currently comprised our subsidiary Aqua Mining. Our Aqua Mining subsidiary is active in timber processing and mineral exploration in Papua New Guinea.

 

Results of Operations

 

Three Months Ended December 31, 2020 Compared to Three Months Ended December 31, 2019

 

During the three months ended December 31, 2020, we recognized $27,712 in revenue. We recognized $39,276 revenue during the three months ended December 31, 2019.

 

We had a net loss for the three months ended December 31, 2020, of $106,592 and a net loss of $230,162 for the three months ended  December 31, 2019.

 

Liquidity and Capital Resources

 

As of December 31, 2020, the Company had $1,794 cash or cash equivalents on hand. However, as of that date, we had total current assets of $72,315 and total current liabilities of $3,367,998 resulting in a working capital deficit of $3,295,683. As of December 31, 2019, the Company had total current assets of $190,891 and total current liabilities of $3,972,216 resulting in a working capital deficit of $3,781,325. The Company intends to fund its exploration through the revenues from the logging activities and the sale of its equity securities. However, there can be no assurance that the Company will be successful doing so. We currently have no agreements, arrangements or understandings with any person to obtain funds through bank loans, lines of credit or any other sources.

 

Factors Affecting Future Mineral Exploration Results

 

We have generated no revenues from mining exploration, since inception. As a result, we have only a limited history upon which to evaluate our future potential performance. Our potential must be considered by evaluation of all risks and difficulties encountered by exploration companies which have not yet established business operations and anticipated results and situations of entering active exploration activities.

 

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Off-Balance Sheet Arrangements

 

We had no Off-Balance Sheet arrangements during the quarter ended December 31, 2020.

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

 

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

 

ITEM 4. CONTROLS AND PROCEDURES.

 

Evaluation of Disclosure Controls and Procedures

 

Under the supervision and with the participation of our management, including the Principal Executive Officer and Principal Financial Officer, we have evaluated the effectiveness of our disclosure controls and procedures as required by Exchange Act Rule 13a-15(b) as of the end of the period covered by this report. Based on that evaluation, the Principal Executive Officer and Principal Financial Officer have concluded that the lack of a functioning audit committee, the lack of segregation of duties within accounting functions, and the lack of multiple directors on our board of directors may result in ineffective oversight in the establishment and monitoring of required internal controls and procedures, which could result in a material misstatement in our financial statements and/or reporting.

 

Changes in Internal Control Over Financial Reporting

 

There was no change in our internal control over financial reporting during the quarter ended December 31, 2020, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

 

PART II. OTHER INFORMATION

 

ITEM 1. LEGAL PROCEEDINGS.

 

We are not presently a party to any litigation.

 

ITEM 1A. RISK FACTORS.

 

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

 

ITEM 2. UNREGISTERED SALE OF EQUITY SECURITIES.

 

None.

 

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

 

None.

 

ITEM 4. MINE SAFETY DISCLOSURES.

 

None.

 

ITEM 5. OTHER INFORMATION.

 

None.

 

- 20 -
 

 

ITEM 6. EXHIBITS.

 

The following documents are included herein:

 

Exhibit       Incorporated by reference   Filed
Number   Document Description   Form   Date   Number   herewith
3.1   Articles of Incorporation   10/A   08/05/15   3.1    
                     
3.2   Certificate of Amendment dated 2/4/2005   10/A   08/05/15   3.2    
                     
3.3   Articles of Merger   10/A   08/05/15   3.3    
                     
3.4   Certificate of Amendment dated 8/22/2013   10/A   08/05/15   3.4    
                     
3.5   Amended and Restated Articles dated 7/7/2010   10/A   08/05/15   3.5    
                     
3.6   Certificate of Amendment dated 8/22/2013   10/A   08/05/15   3.6    
                     
3.7   By-laws   10/A   08/05/15   3.7    
                     
4.1   Certificate of Designation dated 4/19/2011   10/A   08/05/15   4.1    
                     
21   List of Subsidiaries   10/A   08/05/15   21    
                     
31.1   Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002               X
                     
32.1   Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 for the Chief Executive Officer               X
                     
101.INS   XBRL Instance Document               X
                     
101.DEF   XBRL Taxonomy Extension – Definitions               X
                     
101.LAB   XBRL Taxonomy Extension – Labels               X
                     
101.PRE   XBRL Taxonomy Extension – Presentation               X

 

- 21 -
 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following person on behalf of the Registrant and in the capacities on this 22nd of September 2021.

 

  KIBUSH CAPITAL CORP.
     
  BY: /S/ WARREN SHEPPARD
    Warren Sheppard
    President, Chief Executive Officer, Chief Financial and Director

 

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