PART
I
Item
1.
|
Financial
Statements
|
LVYUAN
GREEN BUILDING MATERIAL TECHNOLOGY CORP.
|
Balance
Sheets
|
|
(unaudited)
|
(Audited)
|
|
July
31,
|
April
30,
|
|
2017
|
2017
|
ASSETS
|
|
Current
Assets:
|
|
|
Cash
|
$ -
|
$ -
|
Prepaid
legal
|
-
|
-
|
Total
Current Assets
|
-
|
-
|
TOTAL
ASSETS
|
-
|
-
|
|
|
|
LIABILITIES
& STOCKHOLDERS’ DEFICIT
|
|
|
Current
Liabilities
|
|
|
Accounts
payable
|
$
5,848
|
$
3,755
|
Loan
from director
|
79,484
|
74,380
|
Total
Current Liabilities
|
85,332
|
78,135
|
TOTAL
LIABILITIES
|
85,332
|
78,135
|
|
|
|
Commitments
and Contingencies
|
$ -
|
$ -
|
|
|
|
Shareholders'
Deficit:
|
|
|
Preferred
stock, $.001 par value, 30,000,000 and 0 shares authorized, no shares issued and outstanding at July 31, 2017 and April 30,
2017, respectively.
|
-
|
-
|
Common
stock, $.001 par value, 300,000,000 shares authorized, 6,910,000 issued and outstanding at July 31, 2017; and 6,910,000 issued
and outstanding at April 30, 2017.
|
6,910
|
6,910
|
Additional
paid-in capital
|
17,290
|
17,290
|
Accumulated
deficit
|
(109,532)
|
(102,335)
|
Total
Stockholders’ Deficit
|
(85,332)
|
(78,135)
|
TOTAL
LIABILITIES & STOCKHOLDERS’ DEFICIT
|
$ -
|
$ -
|
The
accompanying notes are an integral part of these unaudited condensed financial statements
LVYUAN
GREEN BUILDING MATERIAL TECHNOLOGY CORP.
|
Statements
of Operations
|
for
the three months ended July 31,
|
(Unaudited)
|
|
|
|
|
2017
|
2016
|
|
|
|
Revenue
|
$ -
|
$ -
|
|
|
|
Operating
Expenses:
|
|
|
General
administrative expense
|
7,197
|
17,084
|
Total
operating expenses
|
7,197
|
17,084
|
|
|
|
Net
loss from operations
|
(7,197)
|
(17,084 )
|
Loss
before income taxes
|
(7,197)
|
(17,084 )
|
Provision
for income taxes
|
-
|
-
|
Net
Loss
|
$ (7,197)
|
$ (17,084 )
|
Basic
and diluted loss per share
|
(0)
|
(0)
|
|
|
|
Weighted
average number of common shares outstanding basic and diluted
|
6,910,000
|
6,910,000
|
The
accompanying notes are an integral part of these unaudited condensed financial statements
LVYUAN
GREEN BUILDING MATERIAL TECHNOLOGY CORP.
|
Statement
of Cash Flows
|
for
the three months ended July 31,
|
(Unaudited)
|
|
|
|
|
2017
|
2016
|
|
|
|
CASH
FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
Net
loss
|
$ (7,197)
|
$ (17,084)
|
Adjustments
to reconcile net loss to net
|
|
|
cash
used in operating activities:
|
|
|
Changes
in operating assets and liabilities:
|
|
|
Increase
in Accounts payable
|
2,093
|
7,858
|
|
|
|
Net cash used in operating activities
|
(5,104)
|
(9,226)
|
|
|
|
CASH
FLOWS FROM INVESTING ACTIVITIES:
|
-
|
-
|
|
|
|
CASH
FLOWS FROM FINANCING ACTIVITIES:
|
|
|
Contributions
from related party
|
5,104
|
9,226
|
Net
cash provided by financing activities
|
5,104
|
9,226
|
|
|
|
Net
increase (decrease) in cash
|
-
|
-
|
|
|
|
Cash
at beginning of period
|
-
|
-
|
|
|
|
Cash
at end of period
|
$ -
|
$ -
|
|
|
|
SUPPLEMENTAL
DISCLOSURES OF CASH FLOW INFORMATION:
|
|
|
Cash
paid for interest
|
-
|
-
|
Cash
paid for taxes
|
-
|
-
|
The
accompanying notes are an integral part of these unaudited condensed financial statements
LVYUAN
GREEN BUILDING MATERIAL TECHNOLOGY CORP.
NOTES
TO CONDENSED FINANCIAL STATEMENTS
1.
|
ORGANIZATION
AND PRINCIPAL ACTIVITIES
|
Lvyuan
Green Building Material Technology Corp. (the “Company”) was incorporated in the State of Nevada on January 10, 2013
as Green Supplements Online Inc. We changed our name to Lvyuan Green Building Material Technology Corp. on September 24, 2015.
Our principal executive offices are located at Room 01, 25/F, Kerry Center, No. 2008 Renmin South Road, Luohu District, Shenzhen
City, Guangdong, People’s Republic of China. Our phone number is +86-755-2218-4466.
Our
business model was to buy nutrition and dietary products from different manufacturers and resell those products under our private
label. Our source of revenue from operations was to be reselling nutrition and dietary supply products. The line of nutrition
and dietary products that we intended to market was to be standard non-proprietary supplements and other products that contained
our label. Currently, we have not yet initiated any product development efforts nor generated any revenue to date.
At
present, we have no employees. Our officers and directors, listed below.
Name
|
|
Age
|
|
Position
|
Wenbo
Yu
|
|
58
|
|
President,
Chairman of the Board of Directors, Chief Executive Officer, Director
|
Ming Huang
|
|
57
|
|
Chief Financial Officer,
Treasurer and Director
|
Enlong Pan
|
|
59
|
|
Secretary and Director
|
Carmen Xiao Yan Yu
|
|
36
|
|
Director
|
Peter Tong
|
|
63
|
|
Director
|
Long Pan
|
|
29
|
|
Director
|
Jianfei Sun
|
|
43
|
|
Director
|
LVYUAN
GREEN BUILDING MATERIAL TECHNOLOGY CORP.
NOTES
TO CONDENSED FINANCIAL STATEMENTS
2.
|
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES
|
|
(a)
|
Basis
of Presentation
|
The
accompanying unaudited condensed financial statements have been prepared from the books and records of the Company in accordance
with U.S. GAAP and Rule 10-01 of Regulation S-X promulgated by the Securities and Exchange Commission (“SEC”). Accordingly,
they do not include all of the information and footnotes required by U.S. GAAP. The condensed statements of operations for the
three months ended July 31, 2017 are not necessarily indicative of the results to be expected for the full year or any future
interim period. These unaudited condensed financial statements should be read in conjunction with the financial statements and
notes thereto included in the Company’s Annual Report on Form 10-K for the year ended April 30, 2017. In the opinion of
management, all adjustments considered necessary for a fair presentation of the results for the interim periods presented have
been reflected in such condensed financial statements.
The
Company maintains its general ledger and journals with the accrual method of accounting for financial reporting purposes. The
financial statements and notes are representations of management. Accounting policies adopted by the Company conform to U.S. GAAP
and have been consistently applied in the presentation of financial statements. The accompanying financial statements are presented
in U.S. dollars in conformity with accounting principles generally accepted in the United States of America and pursuant to the
rules and regulations of the SEC.
|
(b)
|
Net
loss per common share
|
The
Company complies with accounting and disclosure requirements of FASB ASC 260, “Earnings Per Share.” Net loss per common
share is computed by dividing net loss applicable to common stockholders by the weighted average number of common shares outstanding
for the period. At July 31, 2017 and 2016, the Company did not have any dilutive securities and other contracts that could, potentially,
be exercised or converted into common stock and then share in the earnings of the Company. As a result, diluted loss per common
share is the same as basic loss per common share for the period.
The
preparation of the financial statements in conformity with U.S. GAAP 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 periods. Management makes these estimates using
the best information available at the time the estimates are made; however actual results could differ materially from those estimates.
|
(d)
|
Recently
issued or adopted standards
|
The
Company does not expect the adoption of recently issued accounting pronouncements to have a significant impact on the Company’s
results of operations, financial position or cash flow.
LVYUAN
GREEN BUILDING MATERIAL TECHNOLOGY CORP.
NOTES
TO CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
As
of July 31, 2017 and April 30, 2017, the Company had $85,332 and $78,135 in accrued liabilities, respectively. The accrued
liabilities mainly consist of Professional fees.
The
Company complies with the accounting and reporting requirements of FASB ASC, 740, "Income Taxes," which requires
an asset and liability approach to financial accounting and reporting for income taxes. Deferred income tax assets and
liabilities are computed for differences between the financial statement and tax bases of assets and liabilities that will
result in future taxable or deductible amounts, based on enacted tax laws and rates applicable to the periods in which the
differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred
tax assets to the amount expected to be realized. There were no unrecognized tax benefits as of April 30, 2017. FASB ASC 740
prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax
positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be
more-likely-than-not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and
penalties related to unrecognized tax benefits as income tax expense. No amounts were accrued for the payment of interest and
penalties at July 31, 2017. The Company is currently not aware of any issues under review that could result in significant
payments, accruals or material deviation from its position. The adoption of the provisions of FASB ASC 740 did not have a
material impact on the Company's financial position and results of operation and cash flows as of and for the period ended
July 31, 2017.
As of July 31, 2017, we had a net operating loss carry-forward of
approximately $(109,532) and a deferred tax asset of approximately $37,241 using the statutory rate of 34%. The deferred
tax asset may be recognized in future periods, not to exceed 20 years. However, due to the uncertainty of future events
we have booked valuation allowance of $(37,241)
|
July
31, 2017
|
April
30, 2017
|
Deferred
Tax Asset
|
$ 37,241
|
$ 34,794
|
Valuation
Allowance
|
(37,241)
|
(34,794)
|
Deferred
Tax Asset (Net)
|
$ -
|
$ -
|
The
Company files an income tax return in the U.S. federal jurisdiction and may file income tax returns in various U.S. states and
foreign jurisdictions. Generally, the Company is subject to income tax examinations by major taxing authorities during the three
year period prior to the period covered by these financial statements.
Due
to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carry forwards of approximately $109,532
for Federal income tax reporting purposes are subject to annual limitations. Should a change in ownership occur net operating
loss carry forwards may be limited as to use in future years.
5.
|
GOING
CONCERN AND CAPITAL RESOURCES
|
The
Company does not currently engage in any business activities that provide cash flow. During the next 12 months we anticipate incurring
costs related to:
|
●
|
filing
of Exchange Act reports,
|
|
●
|
payment
of annual corporate fees, and
|
|
●
|
investigating,
analyzing and consummating an acquisition.
|
As
of July 31, 2017, the Company had an accumulated deficit of $109,532. Management anticipates that fees associated with filing
of Exchange Act reports including accounting fees and legal fees and payment of annual corporate fees will not exceed $75,000
within next 12 months. We do not currently intend to retain any entity to act as a "finder" to identify and analyze
the merits of potential target businesses. Management intends to search for a business combination by contacting various sources
including, but not limited to, our affiliates, lenders, investment banking firms, private equity funds, consultants and attorneys
and does not plan to conduct a complete and exhaustive investigation and analysis of a business opportunity. Management decisions,
therefore, will likely be made without detailed feasibility studies, independent analysis, market surveys and the like which,
if we had more funds, would be desirable. If the management can find a suitable target company, we will have to budget for additional
fees relating to the investigation into the target company (including due diligence and possibly visiting the facilities) and
consummating the reverse merger, which may cost between $125,000 to $150,000. We expect that the expenses for the next 12 months
and beyond such time will be paid with amounts that may be loaned to or invested in us by our stockholders, management or other
investors. Since we have minimal assets and will continue to incur losses due to the expenses associated with being a reporting
company under the Exchange Act, we may cease business operations if we do not timely consummate a business combination.
Currently,
our ability to continue as a going concern is dependent upon our ability to generate future profitable operations and/or to obtain
the necessary financing to meet our obligations and repay our liabilities arising from normal business operations when they come
due. Our ability to continue as a going concern is also dependent upon our ability to find a suitable target company and enter
into a possible reverse merger with such company. Management’s plan includes obtaining additional funds by equity financing
through a reverse merger transaction and/or related party advances. However, there is no assurance of additional funding being
available.
The
Company may consider a business which has recently commenced operations, is a developing company in need of additional funds for
expansion into new products or markets, is seeking to develop a new product or service, or is an established business which may
be experiencing financial or operating difficulties and is in need of additional capital. In the alternative, a business combination
may involve the acquisition of, or merger with, a company which does not need substantial additional capital, but which desires
to establish a public trading market for its shares, while avoiding, among other things, the time delays, significant expense,
and loss of voting control which may occur in a public offering.
Any
target business that is selected may be a financially unstable company or an entity in its early stages of development or growth,
including entities without established records of sales or earnings. In that event, we will be subject to numerous risks inherent
in the business and operations of financially unstable and early stage or potential emerging growth companies. In addition, we
may effect a business combination with an entity in an industry characterized by a high level of risk, and, although our management
will endeavor to evaluate the risks inherent in a particular target business, there can be no assurance that we will properly
ascertain or assess all significant risks.
Our
management anticipates that it will likely be able to effect only one business combination, due primarily to our limited financing
and the dilution of interest for present and prospective stockholders, which is likely to occur as a result of our management’s
plan to offer a controlling interest to a target business in order to achieve a tax-free reorganization.
The
Company anticipates that the selection of a business combination will be complex and extremely risky. Our potential merger targets
are firms seeking either the benefits of a business combination with an SEC reporting company and/or the perceived benefits of
becoming a publicly traded corporation. Such perceived benefits of becoming a publicly traded corporation include, among other
things, facilitating or improving the terms on which additional equity financing may be obtained, providing liquidity for the
principals of and investors in a business, creating a means for providing incentive stock options or similar benefits to key employees,
and offering greater flexibility in structuring acquisitions, joint ventures and the like through the issuance of stock. While
a private operating company may achieve the same benefits by filing its own Exchange Act registration statement, such benefits
can be achieved at a potentially faster rate with limited regulatory review through the completion of a business combination with
a public reporting company. A potentially available business combination may occur in many different industries and at various
stages of development, all of which will make the task of comparative investigation and analysis of such business opportunities
extremely difficult and complex. The time required to select and evaluate a target business and to structure and complete a business
combination cannot presently be ascertained with any degree of certainty.
In identifying, evaluating and
selecting a target business, we may encounter intense competition from other entities having a business objective similar to ours.
There are numerous blank check companies that have gone public in the United States that have significant financial resources,
that are seeking to carry out a business plan similar to our business plan. Many of these entities are well established and have
extensive experience identifying and effecting business combinations directly or through affiliates. Many of these competitors
possess greater technical, human and other resources than us and our financial resources will be relatively limited when contrasted
with those of many of these competitors.
6.
|
LOANS
FROM OFFICERS AND DIRECTORS
|
As
of July 31,2017, the Company had received loans from its officers and directors aggregating $79,484. The loans are non-interest
bearing and contain no specific repayment terms.
7.
|
COMMON
STOCK TRANSACTIONS
|
During
the past two years there have been no stock issuances.
In
accordance with ASC 855, the Company has analyzed its operations subsequent to July 31, 2017 through September 14, 2017, and has
determined that it does not have any material subsequent events to disclose in these financial statements.
Item
2.
|
Management’s
Discussion and Analysis of Financial Condition and Results of Operations.
|
This
Quarterly Report on Form 10-Q includes forward-looking statements. We have based these forward-looking statements on our current
expectations and projections about future events. These forward-looking statements are subject to known and unknown risks, uncertainties
and assumptions about us that may cause our actual results, levels of activity, performance or achievements to be materially different
from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements.
In some cases, you can identify forward-looking statements by terminology such as “may,” “should,” “could,”
“would,” “expect,” “plan,” “anticipate,” “believe,” “estimate,”
“continue,” or the negative of such terms or other similar expressions. Factors that might cause or contribute to
such a discrepancy include, but are not limited to, those described under “Risk Factors” in our Form 10-K for the
fiscal year ended April 30, 2017, as filed on July 28, 2017. The following discussion should be read in conjunction with our Financial
Statements and related Notes thereto included elsewhere in this report.
Overview
Lvyuan
Green Building Material Technology Corp. (the “Company”) was incorporated in the State of Nevada on January 10, 2013
as Green Supplements Online Inc. We changed to our present name on September 24, 2015. Our principal executive offices are located
at Room 01, 25/F, Kerry Center, No. 2008 Renmin South Road, Luohu District, Shenzhen City, Guangdong, People’s Republic
of China. Our phone number is +86-755-2218-4466.
Our
business model was to buy nutrition and dietary products from different manufacturers and resell those products under our
private label. Our source of revenue from operations was to be reselling nutrition and dietary supply products. The line of
nutrition and dietary products that we intended to market was to be standard non-proprietary supplements and other products
that contained our label. Currently, we have not yet initiated any product development efforts nor generated any revenue to
date.
The
Company is seeking to acquire, through a merger, capital stock exchange, asset acquisition, stock purchase, reorganization, exchangeable
share transaction or other similar business transaction with one or more operating businesses or assets that we have not yet identified.
Operating
Expenses
During
the quarters ended July 31, 2017 and 2016, we have incurred $7,197 and $17,084 in expenses, respectively, primarily consisting
of professional fees associated with the SEC filings.
Going
Concern
The Company does not currently
engage in any business activities that provide cash flow. During the next 12 months we anticipate incurring costs related to:
|
●
|
filing
of Exchange Act reports,
|
|
●
|
payment
of annual corporate fees, and
|
|
●
|
investigating,
analyzing and consummating an acquisition.
|
As
of July 31, 2017, the Company has an accumulated deficit of $109,532. Management anticipates that fees associated with the filing
of Exchange Act reports including accounting fees, legal fees and the payment of annual corporate fees will not exceed $75,000
during the next 12 months. We do not currently intend to retain any entity to act as a “finder” to identify and analyze
the merits of potential target businesses. Management intends to search for a business combination by contacting various sources
including, but not limited to, our affiliates, lenders, investment banking firms, private equity funds, consultants and attorneys
and does not plan to conduct a complete and exhaustive investigation and analysis of a business opportunity. Management decisions,
therefore, will likely be made without detailed feasibility studies, independent analysis, market surveys and the like which,
if we had more funds, would be desirable. If management can find a suitable target company, we will have to budget for additional
fees relating to the investigation into the target company (including due diligence and possibly visiting the facilities) and
consummating the reverse merger, which may cost between $125,000 to $150,000. We expect that the expenses for the next 12 months
and beyond will be paid with amounts that may be loaned to or invested in us by our stockholders, management or other investors.
Since we have minimal assets and will continue to incur losses due to the expenses associated with being a reporting company under
the Exchange Act, we may cease business operations if we do not timely consummate a business combination.
Currently,
our ability to continue as a going concern is dependent upon our ability to generate future profitable operations and/or to obtain
the necessary financing to meet our obligations and repay our liabilities arising from normal business operations when they come
due. Our ability to continue as a going concern is also dependent upon our ability to find a suitable target company and enter
into a possible reverse merger with such company. Management’s plan includes obtaining additional funds by equity financing
through a reverse merger transaction and/or related party advances. However, there is no assurance of additional funding being
available.
The
Company may consider a business which has recently commenced operations, is a developing company in need of additional funds for
expansion into new products or markets, is seeking to develop a new product or service, or is an established business which may
be experiencing financial or operating difficulties and is in need of additional capital. In the alternative, a business combination
may involve the acquisition of, or merger with, a company which does not need substantial additional capital, but which desires
to establish a public trading market for its shares, while avoiding, among other things, the time delays, significant expense,
and loss of voting control which may occur in a public offering.
Any
target business that is selected may be a financially unstable company or an entity in its early stages of development or growth,
including entities without established records of sales or earnings. In that event, we will be subject to numerous risks inherent
in the business and operations of financially unstable and early stage or potential emerging growth companies. In addition, we
may affect a business combination with an entity in an industry characterized by a high level of risk, and, although our management
will endeavor to evaluate the risks inherent in a particular target business, there can be no assurance that we will properly
ascertain or assess all significant risks.
Our
management anticipates that it will likely be able to effect only one business combination, due primarily to our limited financing
and the dilution of interest for present and prospective stockholders, which is likely to occur as a result of our management’s
plan to offer a controlling interest to a target business in order to achieve a tax-free reorganization.
The
Company anticipates that the selection of a business combination will be complex and extremely risky. Our potential merger targets
are firms seeking either the benefits of a business combination with an SEC reporting company and/or the perceived benefits of
becoming a publicly traded corporation. Such perceived benefits of becoming a publicly traded corporation include, among other
things, facilitating or improving the terms on which additional equity financing may be obtained, providing liquidity for the
principals of and investors in a business, creating a means for providing incentive stock options or similar benefits to key employees,
and offering greater flexibility in structuring acquisitions, joint ventures and the like through the issuance of stock. While
a private operating company may achieve the same benefits by filing its own Exchange Act registration statement, such benefits
can be achieved at a potentially faster rate with limited regulatory review through the completion of a business combination with
a public reporting company. A potentially available business combination may occur in many different industries and at various
stages of development, all of which will make the task of comparative investigation and analysis of such business opportunities
extremely difficult and complex. The time required to select and evaluate a target business and to structure and complete a business
combination cannot presently be ascertained with any degree of certainty.
In identifying, evaluating and
selecting a target business, we may encounter intense competition from other entities having a business objective similar to ours.
There are numerous blank check companies that have gone public in the United States that have significant financial resources,
that are seeking to carry out a business plan similar to our business plan. Many of these entities are well established and have
extensive experience identifying and effecting business combinations directly or through affiliates. Many of these competitors
possess greater technical, human and other resources than us and our financial resources will be relatively limited when contrasted
with those of many of these competitors.
Liquidity
and Capital Resources
As
of July 31, 2017, our total assets were $0 and our total liabilities were $85,332, comprised of accounts payable and notes payable
to related parties.
Stockholders’
equity decreased from $(78,135) as of April 30, 2017 to $(85,332) as of July 31, 2017.
Cash
Flows from Operating Activities
We
have not generated positive cash flows from operating activities. For the three months ended July 31, 2017 and July 31, 2016,
net cash flows used in operating activities were $(5,104) and $(9,226) respectively, consisting of net losses in both periods
and a change in accounts payable for the three months ended May 31, 2017.
Cash
Flows from Financing Activities
We have financed our operations
primarily from either advancements or the issuance of equity and debt instruments. For the three months ended July 31, 2017 and
2016, net cash from financing activities was $5,104 and $9,226, respectively, consisting of loans from directors.
Cash
Flows from Financing Activities
We
suffered recurring losses from operations and have an accumulated deficit of $109,532 as of July 31, 2017,currently, we are a
non-operating public company. We currently are seeking to acquire, through a merger, capital stock exchange, asset
acquisition, stock purchase, reorganization, exchangeable share transaction or other similar business transaction with one or
more operating businesses or assets that we have not yet identified. In the event we use all of our cash resources, certain
members of management and shareholders have indicated their willingness to loan us funds at the prevailing market rate,
assuming we find a suitable candidate for an acquisition, until such acquisition is consummated. Even though this is their
current intention, they have made no firm commitment and it is at their sole discretion whether or not to fund us. In the
event they do not fund us and we are not able to find outside investors, we will not have the funds necessary to operate and
will have to dissolve.
Off-Balance
Sheet Arrangements
We have not entered into any 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 and would
be considered material to investors.
Item
3.
|
Quantitative
and Qualitative Disclosures about Market Risk.
|
Not
applicable.
Item
4.
|
Controls
and Procedures.
|
Evaluation
of Disclosure Controls and Procedures
Based
on an evaluation of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the
Exchange Act), as of July 31, 2017, the Company’s Interim Chief Executive Officer and Chief Financial Officer (its principal
executive officer and principal financial and accounting officer) has concluded that the Company’s disclosure controls and
procedures were not effective at a reasonable assurance level.
Limitations
on the Effectiveness of Controls
A
control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives
of the control system are met. Because of the inherent limitations in all controls systems, no evaluation of controls can provide
absolute assurance that all control issues and instances of fraud, if any, within a company have been detected. Our disclosure
controls and procedures are designed to provide reasonable assurance of achieving its objectives.
Changes
in Internal Control Over Financial Reporting
There
have not been any changes in the Company’s internal controls over financial reporting that occurred during the Company’s
fiscal quarter ended July 31, 2017 that has materially affected, or is reasonably likely to materially affect, the Company’s
internal control over financial reporting.