ITEM 1. FINANCIAL STATEMENTS
The accompanying balance sheets of Oranco, Inc. (a development stage company) at September 30, 2017 and December 31, 2016, and the related statement of operations for the three and nine months ended September 30, 2017 and 2016 and the statement of cash flows for the nine months, ended September 30, 2017 and 2016 have been prepared by the Company's management in conformity with accounting principles generally accepted in the United States of America. In the opinion of management, all adjustments considered necessary for a fair presentation of the results of operations and financial position have been included and all such adjustments are of a normal recurring nature.
Operating results for the nine months ended September 30, 2017, are not necessarily indicative of the results that can be expected for the year ending December 31, 2017.
ORANCO, INC.
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BALANCE SHEETS
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SEPTEMBER 30, 2017 AND DECEMBER 31, 2016
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September 30,
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December 31,
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2017
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2016
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Assets
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Current Assets:
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Cash
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$
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483
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$
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3,234
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Prepaid expenses
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5,833
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3,333
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Total current assets
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6,316
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6,567
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Total Assets
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$
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6,316
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$
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6,567
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Liabilities and Stockholders' Equity
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Current Liabilities:
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Accounts payable
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$
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5,560
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$
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1,300
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Interest payable, stockholder
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781
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164
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Note payable, stockholder
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27,500
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10,000
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Total current liabilities
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33,841
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11,464
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Stockholders' Equity:
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Common stock, $.001 par value 100,000,000 shares authorized, 4,269,950 issued and outstanding
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4,270
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4,270
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Additional paid-in capital
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349,898
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349,898
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Accumulated deficit
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(381,693
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(359,065
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Total Stockholders' Equity
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(27,525
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(4,897
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Total Liabilities and Stockholders' Equity
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$
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6,316
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$
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6,567
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The accompanying notes are an integral part of the financial statements.
ORANCO, INC.
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STATEMENTS OF OPERATIONS
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For the
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For the
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For the
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For the
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Three Months
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Three Months
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Nine Months
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Nine Months
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Ended
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Ended
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Ended
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Ended
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September 30,
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September 30,
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September 30,
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September 30,
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2017
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2016
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2017
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2016
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Revenues
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$
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--
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$
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--
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$
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--
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$
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--
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Expenses, general and administrative
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5,200
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7,442
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22,012
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22,741
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Operating loss
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(5,200
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(7,442
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(22,012
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(22,741
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Other income (expense):
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Interest income
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--
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1
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1
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3
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Interest expense
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(277
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(63
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(617
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(63
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Total other income (expense)
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(277
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(62
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(616
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(60
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Loss before provision for income taxes
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(5,477
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(7,504
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(22,628
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(22,801
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Provision for income taxes
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--
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--
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--
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--
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Net loss
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$
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(5,477
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$
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(7,504
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$
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(22,628
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$
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(22,801
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Net loss per share
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$
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--
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$
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--
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$
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(0.01
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$
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(0.01
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Weighted average shares outstanding
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4,269,950
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4,269,950
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4,269,950
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4,269,950
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The accompanying notes are an integral part of the financial statements.
ORANCO, INC.
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STATEMENTS OF CASH FLOWS
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For the
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For the
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Nine Months
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Nine Months
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Ended
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Ended
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September 30,
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September 30,
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2017
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2016
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Cash flows from operating activities:
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Net loss
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$
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(22,628
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$
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(22,801
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Adjustments to reconcile net loss to cash provided by operating activities:
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(Increase) decrease in prepaid expenses
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(2,500
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1,930
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Increase (decrease) in accounts payable
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4,260
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(650
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Increase in interest payable
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617
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63
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Net cash used by operating activities
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(20,251
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(21,458
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Cash flows from investing activities:
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--
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--
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Cash flows from financing activities:
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Proceeds from related party note payable
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17,500
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10,000
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Net decrease in cash
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(2,751
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(11,458
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Cash, beginning of period
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3,234
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16,792
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Cash, end of period
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$
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483
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$
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5,334
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Interest paid
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$
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--
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$
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--
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Income taxes paid
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$
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--
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$
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--
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The accompanying notes are an integral part of the financial statements.
ORANCO, INC.
NOTES TO FINANCIAL STATEMENTS
1.
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Summary of Business and Significant Accounting Policies
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a.
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Summary of Business
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The Company was incorporated under the laws of the State of Nevada on June 16, 1977. The Company has been in the business of the development of mineral deposits. During 1983 all activities were abandoned and the Company has remained inactive since that time. The Company has not commenced principal operations. The Company is looking to pursue business opportunities.
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b.
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Basis of Presentation
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The accompanying financial statements have been prepared in accordance with generally accepted accounting principles ("GAAP") as promulgated in the United States of America.
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c.
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Cash Flows
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For purposes of the statement of cash flows, the Company considers all highly liquid investments purchased with a maturity of three months or less to be cash or cash equivalents.
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d.
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Net Loss per Share
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The net loss per share calculation is based on the weighted average number of shares outstanding during the period.
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e.
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Use of Estimates
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The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.
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f.
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Fair Value of Financial Instruments
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ASC 820-10 requires entities to disclose the fair value of financial instruments, both assets and liabilities recognized and not recognized on the balance sheet, for which it is practicable to estimate fair value. ASC 820-10 defines the fair value of a financial instrument as the amount at which the instrument could be exchanged in a current transaction between willing parties. As of September 30, 2017 and December 31, 2016, the carrying value of certain financial instruments approximates fair value due to the short-term nature of such instruments.
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Notes to Financial Statements –
Continued:
2.
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Notes Payable, Stockholder
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Stockholder notes payable consist of the following at September 30, 2017 and December 31, 2016:
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2017
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2016
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Notes payable to an individual also a stockholder and director of the Company, interest is being charged at 4%, the notes are unsecured and due one year from issuance. The note principal and accrued interest is convertible into common stock at $.001 per share.
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$
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27,500
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$
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10,000
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On November 4, 2017, the notes payable and accrued interest was converted into 28,374,680 shares of common stock. There was no gain or loss on the conversion.
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3.
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Warrants and Stock Options
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No options or warrants are outstanding to acquire the Company's common stock.
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4.
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Income Taxes
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The Company has had no taxable income under Federal or State tax laws. The Company has loss carrforwards totaling $359,065 that may be offset against future federal income taxes. If not used, the carryforwards will expire 20 years after they are incurred. Due to the Company being in the development stage and incurring net operating losses, a valuation allowance has been provided to reduce the deferred tax assets from the net operating losses to zero. Therefore, there are no tax benefits recognized in the accompanying statement of operations.
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5.
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Going Concern
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As shown in the accompanying financial statements, the Company incurred a net loss of $22,628 during the period ended September 30, 2017 and accumulated losses of $381,693 since inception at June 15, 1977. The Company's current liabilities exceed its current assets by $27,525 at September 30, 2017. These factors create an uncertainty as to the Company's ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent upon the success of raising additional capital through the issuance of common stock and the ability to generate sufficient operating revenue. The financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Plan of Operations.
The Company has not engaged in any material operations or had any revenues from operations since inception. The Company's plan of operation for the next 12 months is to continue to seek the acquisition of assets, properties or businesses that may benefit the Company and its stockholders. Management intends to focus is efforts in Europe, Africa, and South America both because management is located Europe and because management believes that the Company can locate superior acquisition opportunities in these geographical areas. Management anticipates that to achieve any such acquisition, the Company will issue shares of its common stock as the sole consideration for such acquisition.
During the next 12 months, the Company's only foreseeable cash requirements will relate to maintaining the Company in good standing or the payment of expenses associated with reviewing or investigating any potential business venture, which the Company expects to pay from its cash resources as well as loans from management. Management believes that these funds are sufficient to cover its cash needs for the next 12 months. If additional funds are required during this period, such funds may be advanced by management or stockholders as loans to the Company. Because the Company has not identified any such venture as of the date of this Report, it is impossible to predict the amount of any such loan. However, any such loan will be on terms no less favorable to the Company than would be available from a commercial lender in an arm's length transaction. As of the date of this Report, the Company is not engaged in any negotiations with any person regarding any venture.
Results of Operations.
Other than restoring and maintaining its good corporate standing in the State of Nevada, obtaining an audit of the Company's financial statements, submitting the Company's common stock for quotation on the NASD OTC Bulleting Board, the filing of a Form 10 Registration, and the completion of a private placement, the Company has had no material business operations and in the two most recent calendar years, it activities have been limited to evaluating possible merger or acquisition candidates..
Three And Nine Month Period Ended September 30, 2017 and 2016
The Company did not generate any revenue during the three and nine months ended September 30, 2017 and 2016, respectively. It had interest income of $0 and $1 for the three months and $1
and $3 for the nine months ended September 30, 2017 and 2016.
General and administrative expenses, including interest, were $5,477 and $7,504 for the three months and $22,628 and $22,801 for the nine months ended September 30, 2017 and 2016, respectively . The changes in
expenses for the three months ended September 30, 2017 and 2016 were largely some decreases in accounting, legal, other professional costs and timing issues and as to nine months ended September 30, 2010 and 2016 largely due to decreased regulatory costs. As a result of the foregoing, the Company realized net losses of $5,477 and $7,504 for the three months and $ 22,628 and $22,801 for the nine months ended September 30, 2017 and 2016, respectively
Liquidity and Capital Resources
At September 30, 2017, assets consisted of $483 in cash and $5833 in prepaid expenses compared to $3,234 in cash and $3,333 in prepaid expenses on December 31, 2016. As of September 30, 2017, the Company had $5,560 in accounts payable. In addition, Notes Payable to stockholders increased from $10,000 to $27,500, the proceeds of which were used to pay the Company's operating costs.
Currently, the Company has no material commitments for capital expenditures. Management anticipates that operating expenses for the next twelve months will be approximately $20,000 to $25,000. Management understands that it does not have sufficient cash to meet its immediate operational needs and will require additional capital to cover ongoing operating expenses. Management may attempt to raise additional capital for its current operational needs through loans from its officers or shareholders, debt financing, equity financing or a combination of financing options. However, there are no existing understandings, commitments or agreements for such an infusion; nor can there be assurances to that effect.
ITEM 4T. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures.
Our management, with the participation of our president/chief financial officer, carried out an evaluation of the effectiveness of our "disclosure controls and procedures" (as defined in the Securities Exchange Act of 1934 (the "Exchange Act") Rules 13a-15(e) and 15-d-15(e)) as of the end of our last fiscal quarter, September 30, 2017, (the "Evaluation Date"). Based upon that evaluation, our president/chief financial officer concluded that, as of the Evaluation Date, our disclosure controls and procedures are not effective to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act (i) is recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms and (ii) is accumulated and communicated to our management, including our president and our chief financial officer, as appropriate to allow timely decisions regarding required disclosure.
Changes in Internal Control Over Financial Reporting.
There were no changes in our internal controls over financial reporting that occurred during our last fiscal quarter (ended September 30, 2017) that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.