There is a limited public market for our common shares. Our common shares are not quoted on the OTC Bulletin Board at this time. Trading in stocks quoted on the OTC Bulletin Board is often thin and is characterized by wide fluctuations in trading prices due to many factors that may be unrelated to a company’ s operations or business prospects. We cannot assure you that there will be a market in the future for our common stock.
OTC Bulletin Board securities are not listed or traded on the floor of an organized national or regional stock exchange. Instead, OTC Bulletin Board securities transactions are conducted through a telephone and computer network connecting dealers in stocks. OTC Bulletin Board issuers are traditionally smaller companies that do not meet the financial and other listing requirements of a regional or national stock exchange.
As of June 30, 2017, the 35,400,000 issued and outstanding shares of common stock were held by a total of 35 shareholders of record.
No cash dividends have been paid on our shares of common stock during the fiscal years ended June 30, 2017 and 2016. We have not paid any cash dividends since our inception and do not foresee declaring any cash dividends on our common stock in the foreseeable future.
Item 8. Financial Statements and Supplementary Data.
Index to the Financial Statements
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Board of Directors and Stockholders
Star Alliance International Corp.
We have audited the accompanying balance sheet of Star Alliance International Corp. (formerly known as Asteriko Corp. and “the Company”) as of June 30, 2017, and the related statements of operations and comprehensive loss, changes in stockholders’ deficit, and cash flows for the year then ended. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform an audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Star Alliance International Corp. as of June 30, 2017, and the results of its operations and its cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America.
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 3 to the financial statements, the Company has suffered recurring losses from operations and has a net capital deficiency that raises substantial doubt about its ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/s/ MaloneBailey, LLP
www.malonebailey.com
Houston, Texas
November 27, 2017
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors
Star Alliance International Corp.
We have audited the accompanying balance sheet of Star Alliance International Corp. as of June 30, 2016 and the related statements of operations, stockholders’ deficit and cash flows for the year then ended. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.
We conducted our audits in accordance with standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Star Alliance International Corp. as of June 30, 2016 and the results of its operations and cash flows for the period described above in conformity with accounting principles generally accepted in the United States of America.
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 3 to the financial statements, the Company suffered a net loss from operations and has a net capital deficiency, which raises substantial doubt about its ability to continue as a going concern. Management’s plans regarding those matters are also described in Note 3. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/s/ M&K CPAS, PLLC
www.mkacpas.com
Houston, Texas
September 8, 2016
Star Alliance International Corp.
(Formerly known as Asteriko Corp.)
BALANCE SHEETS
|
|
June 30,
|
|
|
June 30,
|
|
|
|
2017
|
|
|
2016
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
Current assets
|
|
|
|
|
|
|
Cash
|
|
$
|
-
|
|
|
$
|
1,380
|
|
|
|
|
|
|
|
|
|
|
Total current assets
|
|
|
-
|
|
|
|
1,380
|
|
|
|
|
|
|
|
|
|
|
Non-current assets
|
|
|
|
|
|
|
|
|
Property and equipment, net
|
|
|
-
|
|
|
|
2,171
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
$
|
-
|
|
|
$
|
3,551
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' DEFICIT
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts payable
|
|
$
|
-
|
|
|
$
|
99
|
|
Accrued expenses and other payable
|
|
|
25,897
|
|
|
|
-
|
|
Related party loans
|
|
|
-
|
|
|
|
1,199
|
|
Note payable - related party
|
|
|
-
|
|
|
|
18,000
|
|
Total current liabilities
|
|
|
25,897
|
|
|
|
19,298
|
|
|
|
|
|
|
|
|
|
|
Total liabilities
|
|
|
25,897
|
|
|
|
19,298
|
|
|
|
|
|
|
|
|
|
|
Stockholders’ deficit
|
|
|
|
|
|
|
|
|
Common stock, $0.001 par value, 75,000,000 shares authorized, 35,400,000 shares issued and outstanding as of June 30, 2017 and 2016 (*)
|
|
|
35,400
|
|
|
|
35,400
|
|
Additional paid-in capital
|
|
|
478,339
|
|
|
|
(8,293
|
)
|
Accumulated deficit
|
|
|
(539,636
|
)
|
|
|
(42,854
|
)
|
Total stockholders’ deficit
|
|
|
(25,897
|
)
|
|
|
(15,747
|
)
|
|
|
|
|
|
|
|
|
|
Total liabilities and stockholders’ deficit
|
|
$
|
-
|
|
|
$
|
3,551
|
|
The accompanying notes are an integral part of these financial statements.
(*) In January 2017, Board of Directors of the Company approved a 5-for-1 forward stock split, whereby every one (1) share of the common stock was automatically reclassified and changed into five (5) shares (the “Stock Split”). The authorized number of shares and par value per share were not be affected by the Stock Split. The Company’s capital accounts have been retroactively restated to reflect the Stock Split.
Star Alliance International Corp.
(Formerly known as Asteriko Corp.)
Statements of Operations
and Comprehensive Loss
|
|
Year ended
June 30,
2017
|
|
|
Year ended
June 30,
2016
|
|
Operating expenses:
|
|
|
|
|
|
|
General and administrative
|
|
$
|
253,853
|
|
|
$
|
1,580
|
|
Imputed interest expense
|
|
|
420
|
|
|
|
907
|
|
Professional fees
|
|
|
242,737
|
|
|
|
19,902
|
|
|
|
|
|
|
|
|
|
|
Total operating expenses
|
|
|
497,010
|
|
|
|
22,389
|
|
|
|
|
|
|
|
|
|
|
Loss from operations
|
|
|
(497,010
|
)
|
|
|
(22,389
|
)
|
|
|
|
|
|
|
|
|
|
Other income
|
|
|
|
|
|
|
|
|
Interest income
|
|
|
228
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Total other income
|
|
|
228
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Loss before provision for income taxes
|
|
|
(496,782
|
)
|
|
|
(22,389
|
)
|
Provision for income taxes
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(496,782
|
)
|
|
$
|
(22,389
|
)
|
|
|
|
|
|
|
|
|
|
Other comprehensive loss
|
|
|
|
|
|
|
|
|
Foreign currency translation adjustment
|
|
|
(23,879
|
)
|
|
|
-
|
|
Total other comprehensive loss
|
|
|
(23,879
|
)
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive loss
|
|
|
(520,661
|
)
|
|
|
(22,389
|
)
|
|
|
|
|
|
|
|
|
|
Net loss per common stock – basic and diluted
|
|
$
|
(0.01
|
)
|
|
$
|
(0.00
|
)
|
Weighted average common stocks outstanding - basic and diluted (*)
|
|
|
35,400,000
|
|
|
|
35,400,000
|
|
The accompanying notes are an integral part of these financial statements.
(*) In January 2017, Board of Directors of the Company approved a 5-for-1 forward stock split, whereby every one (1) share of the common stock was automatically reclassified and changed into five (5) shares (the “Stock Split”). The authorized number of shares and par value per share were not be affected by the Stock Split. The Company’s capital accounts have been retroactively restated to reflect the Stock Split.
Star Alliance International Corp.
(Formerly known as Asteriko Corp.)
Statements of Cash Flows
|
|
Year Ended
June 30,
2017
|
|
|
Year Ended
June 30,
2016
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM OPERATING ACTIVITIES
|
|
|
|
|
|
|
Net loss
|
|
$
|
(496,782
|
)
|
|
$
|
(22,389
|
)
|
|
|
|
|
|
|
|
|
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
|
|
|
|
|
Depreciation expense
|
|
|
7,653
|
|
|
|
314
|
|
Imputed interest expense
|
|
|
420
|
|
|
|
907
|
|
Changes in assets and liabilities:
|
|
|
|
|
|
|
|
|
Prepayments and other current assets
|
|
|
(12,904
|
)
|
|
|
-
|
|
Accounts payable
|
|
|
194,808
|
|
|
|
(180
|
)
|
Accrued expenses and other payable
|
|
|
27,134
|
|
|
|
-
|
|
Advances from shareholders
|
|
|
-
|
|
|
|
(405
|
)
|
|
|
|
|
|
|
|
|
|
Cash used in operating activities
|
|
|
(279,671
|
)
|
|
|
(21,753
|
)
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
Purchase of property and equipment
|
|
|
(27,081
|
)
|
|
|
(1,151
|
)
|
|
|
|
|
|
|
|
|
|
Cash used in investing activities
|
|
|
(27,081
|
)
|
|
|
(1,151
|
)
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
Cash distributed to related parties
|
|
|
(4,879
|
)
|
|
|
-
|
|
Repayments to related parties
|
|
|
(635,024
|
)
|
|
|
-
|
|
Proceeds of borrowings from related parties
|
|
|
683,665
|
|
|
|
13,000
|
|
Capital contribution of subsidiaries
|
|
|
285,489
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by financing activities
|
|
|
329,251
|
|
|
|
13,000
|
|
|
|
|
|
|
|
|
|
|
Effect of foreign exchange on cash
|
|
|
(23,879
|
)
|
|
|
-
|
|
Net decrease in cash
|
|
|
(1,380
|
)
|
|
|
(9,904
|
)
|
Cash at the beginning of year
|
|
|
1,380
|
|
|
|
11,284
|
|
Cash at the end of year
|
|
$
|
-
|
|
|
$
|
1,380
|
|
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
|
|
|
|
|
|
|
|
|
Interest paid
|
|
$
|
-
|
|
|
$
|
-
|
|
Income taxes paid
|
|
$
|
-
|
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
NON-CASH TRANSACTIONS
|
|
|
|
|
|
|
|
|
Operating expenses paid by related party
|
|
$
|
194,809
|
|
|
$
|
-
|
|
Property and equipment distributed to and liabilities assumed by former shareholder
|
|
$
|
23,089
|
|
|
$
|
-
|
|
Assets and liabilities of subsidiaries disposed of to entity under common control
|
|
$
|
206,392
|
|
|
$
|
-
|
|
Star Alliance International Corp.
(Formerly known as Asteriko Corp.)
Statements of Stockholders’ Deficit
|
|
Common stock (*)
|
|
|
Additional
|
|
|
|
|
|
Total
|
|
|
|
Number of
Shares
|
|
|
Amount
|
|
|
Paid-in
Capital
|
|
|
Accumulated
Deficit
|
|
|
Stockholders’
Deficit
|
|
Balance, June 30, 2015
|
|
|
35,400,000
|
|
|
$
|
35,400
|
|
|
$
|
(9,200
|
)
|
|
$
|
(20,465
|
)
|
|
$
|
5,735
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Imputed interest
|
|
|
-
|
|
|
|
-
|
|
|
|
907
|
|
|
|
-
|
|
|
|
907
|
|
Net loss
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(22,389
|
)
|
|
|
(22,389
|
)
|
Balance, June 30, 2016
|
|
|
35,400,000
|
|
|
$
|
35,400
|
|
|
$
|
(8,293
|
)
|
|
$
|
(42,854
|
)
|
|
$
|
(15,747
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Imputed interest
|
|
|
-
|
|
|
|
-
|
|
|
|
420
|
|
|
|
-
|
|
|
|
420
|
|
Net liabilities forgiven by former shareholder
|
|
|
-
|
|
|
|
-
|
|
|
|
19,823
|
|
|
|
-
|
|
|
|
19,823
|
|
Increase in additional paid-in capital in connection with disposal of subsidiaries
|
|
|
-
|
|
|
|
-
|
|
|
|
466,389
|
|
|
|
-
|
|
|
|
466,389
|
|
Net loss
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(496,782
|
)
|
|
|
(496,782
|
)
|
Balance, June 30, 2017
|
|
|
35,400,000
|
|
|
$
|
35,400
|
|
|
$
|
478,339
|
|
|
$
|
(539,636
|
)
|
|
$
|
(25,897
|
)
|
See accompanying notes to the financial statements
(*) In January 2017, Board of Directors of the Company approved a 5-for-1 forward stock split, whereby every one (1) share of the common stock was automatically reclassified and changed into five (5) shares (the “Stock Split”). The authorized number of shares and par value per share were not be affected by the Stock Split. The Company’s capital accounts have been retroactively restated to reflect the Stock Split.
Star Alliance International Corp
.
(Formerly known as Asteriko Corp.)
Notes to the Financial Statements
For the Years Ended June 30, 2017 and 2016
Note 1 - Organization and Operations
Star Alliance International Corp. (“the Company”, “we”, “us”) was originally incorporated with the name Asteriko Corp. in the State of Nevada on April 17, 2014. Our initial business plan was to provide customers with unique and innovative solution for their decorative needs. The Company’s initial product was lattice panels designed for suspended ceiling. We had generated limited earnings under this plan.
On November 25, 2016, pursuant to a stock purchase agreement reached by and between Ilia Tomski, the Company’s controlling shareholder, President and CEO at the time, and Kido Inter Co. Limited (“Kido”) which is wholly owned by Ms. Somporn Phatchan, Kido acquired 25,000,000 shares of common stock of the Company, representing 70.62% of ownership, for cash consideration of $246,000. On November 25, 2016, Ilia Tomski resigned his official position as President and CEO of the Company, and on the same day the shareholders of the Company voted Ms. Somporn Phatchan as Director and CEO of the Company, Eng Wah Kung as Chief Financial Officer and Director, and Yun Chen Zou as Chief Operating Officer and Director.
On December 17, 2016, the Company acquired 100% equity interest in Astral Investments Limited (“Astral”), a British Virgin Islands (“BVI”) company incorporated and owned by Ms. Somporn Phatchan, with a consideration of $50,000.
On December 17, 2016, Ms. Somporn Phatchan, on behalf of Astral, paid MOP 25,000 (approximately $3,205) to owners of Star Alliance Macau Ltd. (“SA Macau”) to take over its ownership.
On January 6, 2017, the Board of Directors of the Company adopted an amendment to its Articles changing the Company’s name to Star Alliance International Corp. from Asteriko Corp. On January 10, 2017, the Company additionally amended its Articles to effectuate a Forward Stock Split of 5:1 (the “Stock Split”). The Financial Industry Regulatory Authority (“FINRA”) gave final approval for the above changes on March 17, 2017. The accompanying financial statements and notes to the financial statements give retroactive effect to the Stock Split and have been adjusted for all periods presented.
On February 2, 2017, Astral acquired 100% equity interest in Star Alliance Inter Co., Limited (“SA Thailand”), a Thailand company incorporated and owned by Ms. Somporn Phatchan, with a consideration of THB10,000,000 (approximately $285,489).
The Company intended to provide travel and adventure packages to MICE (Meeting, Incentive, Convention, Events) tourists primarily in the Asia region. Services and products to be provided by SA Thailand would initially include pre-arranged tours, customized packages according to clients’ specifications, travel consultation, and as time progressed making reservations for lodging amongst other related services. However, as the business did not bring any revenue and the management determined that this business plan did not work well, which led to the disposal transaction mentioned as below.
On June 30, 2017, pursuant to a stock purchase agreement entered into by and between Ms. Somporn Phatchan and the Company, all common shares of Astral were sold to Ms. Somporn Phatchan for a consideration of $1. Starting from the same day, Astral, SA Macau and SA Thailand are no longer wholly owned subsidiaries of the Company.
See Note 4 – Stockholders’ Deficit for details of the above transactions.
On July 31, 2017, Ms. Somporn Phatchan resigned from her positions as the CEO and Director of the Company. On the same day, the shareholders voted Dr. Kok Chee Lee, as CEO and Director of the Company.
Note 2 - Significant and Critical Accounting Policies and Practices
The Management of the Company is responsible for the selection and use of appropriate accounting policies and the appropriateness of accounting policies and their application. Critical accounting policies and practices are those that are both most important to the portrayal of the Company’s financial condition and results and require management’ s most difficult, subjective, or complex judgments, often as a result of the need to make estimates about the effects of matters that are inherently uncertain. The Company’s significant and critical accounting policies and practices are disclosed below as required by generally accepted accounting principles in the United States of America.
Basis of Presentation
The Company’s financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).
Principles of Consolidation
On June 30, 2017, the Company disposed of Astral, SA Macau and SA Thailand. The accompanying balance sheets present the financial position of Star Alliance International Corp. only. The related statements of operations and comprehensive loss, changes in stockholders’ deficit, and cash flows for the year ended June 30, 2017 contain the result of operations and cash flows of Star Alliance International Corp., and the subsidiaries that were disposed of on June 30, 2017. All significant inter-company transactions have been eliminated in the preparation of these financial statements.
Use of Estimates and Assumptions and Critical Accounting Estimates and Assumptions
The preparation of 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 dates 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, however, actual results could differ materially from those estimates.
Fair Value of Financial Instruments
The Company follows paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and paragraph 820-10-35-37 of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 establishes a framework for measuring fair value in generally accepted accounting principles (GAAP), and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below:
Level 1
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|
Quoted market prices available in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date.
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|
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|
Level 2
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Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs).
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|
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Level 3
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Unobservable inputs that reflect our assumptions about the assumptions that market participants would use in pricing the asset or liability.
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The Company’s financial instruments consist principally of cash, accounts payable, and accrued expenses and other payable. The carrying amounts of such financial instruments in the accompanying balance sheets approximate their fair values due to their relatively short-term nature.
Transactions involving related parties cannot be presumed to be carried out on an arm's-length basis, as the requisite conditions of competitive, free-market dealings may not exist. Representations about transactions with related parties, if made, shall not imply that the related party transactions were consummated on terms equivalent to those that prevail in arm's-length transactions unless such representations can be substantiated. It is not, however, practical to determine the fair value of amounts due to related party’s due to their related party nature.
Cash and Cash Equivalents
Cash and cash equivalents include cash on hand, certificates of deposit and all highly liquid investments with maturities of three months or less at the time of purchase. The cash balances were $0 and $1,380, respectively, as of June 30, 2017 and 2016.
Property and Equipment
Property and equipment are stated at cost less accumulated depreciation and impairment. Depreciation on property and equipment is calculated on the straight-line method. Significant improvements are capitalized when it is probable that the expenditure resulted in an increase in the future economic benefits expected to be obtained from the use of the asset beyond its originally assessed standard of performance. When improvements are made to real property and those improvements are permanently affixed to the property, the title to those improvements is automatically transferred to the owner of the property. The lessee’s interest in the improvements is not a direct ownership interest but rather an intangible right to use and benefit from the improvements during the term of the lease. Leasehold improvements are depreciated over the lesser of lease term of the related leased assets or 5 years.
Maintenance and repair costs are expensed as incurred, whereas significant renewals and betterments are capitalized. At the time of retirement or other disposition of property and equipment, the cost and accumulated depreciation will be removed from the accounts, and any resulting gain or loss will be reflected in operations.
The Company will assess the recoverability of property and equipment by determining whether the depreciation of these assets over their remaining life can be recovered through projected undiscounted future cash flows. The amount of equipment impairment, if any, will be measured based on fair value and is charged to operations in the period in which such impairment is determined by management.
Property and equipment schedule as of June 30, 2017 and 2016 is as the following:
|
|
June 30,
2017
|
|
|
June 30,
2016
|
|
Leasehold improvements
|
|
$
|
-
|
|
|
$
|
-
|
|
Office equipment
|
|
|
-
|
|
|
|
2,626
|
|
|
|
|
|
|
|
|
|
|
Total cost
|
|
|
-
|
|
|
|
2,626
|
|
Accumulated depreciation
|
|
$
|
-
|
|
|
$
|
455
|
|
|
|
|
|
|
|
|
|
|
Property and equipment, net
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|
$
|
-
|
|
|
$
|
2,171
|
|
The depreciation expense for the years ended June 30, 2017 and 2016 was $7,653 and $314, respectively.
Related Parties
A related party is generally defined as (i) any person that holds 10% or more of the Company’s securities and their immediate families, (ii) the Company’s management, (iii) someone that directly or indirectly controls, is controlled by or is under common control with the Company, or (iv) anyone who can significantly influence the financial and operating decisions of the Company. A transaction is considered to be a related party transaction when there is a transfer of resources or obligations between related parties. The Company conducts business with its related parties in the ordinary course of business.
Income Tax Provision
The Company accounts for income taxes under Section 740-10-30 of the FASB Accounting Standards Codification. Deferred income tax assets and liabilities are determined based upon differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the statements of operations in the period that includes the enactment date.
The Company adopted section 740-10-25 of the FASB Accounting Standards Codification (“Section 740-10-25”). Section 740-10-25 addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under Section 740-10-25, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than fifty percent (50%) likelihood of being realized upon ultimate settlement. Section 740-10-25 also provides guidance on de-recognition, classification, interest and penalties on income taxes, accounting in interim periods and requires increased disclosures.
The estimated future tax effects of temporary differences between the tax basis of assets and liabilities are reported in the accompanying balance sheets, as well as tax credit carry-backs and carry-forwards. The Company periodically reviews the recoverability of deferred tax assets recorded on its balance sheets and provides valuation allowances as management deems necessary.
Management makes judgments as to the interpretation of the tax laws that might be challenged upon an audit and cause changes to previous estimates of tax liability. In addition, the Company operates within multiple taxing jurisdictions and is subject to audit in these jurisdictions. In management’s opinion, adequate provisions for income taxes have been made for all years. If actual taxable income by tax jurisdiction varies from estimates, additional allowances or reversals of reserves may be necessary.
Uncertain Tax Positions
The Company did not take any uncertain tax positions and had no adjustments to its income tax liabilities or benefits pursuant to the provisions of Section 740-10-25 for the years ended June 30, 2017 and June 30, 2016.
Foreign Currency Translation
The accompanying financial statements are presented in United States dollars (USD). The functional currencies of SA Macau and SA Thailand were Hong Kong Dollars (HKD) and Thai Baht (THB), respectively. The financial statements were translated into USD from HKD or THB at period-end exchange rates for assets and liabilities, and weighted average exchange rates for expenses. Capital accounts are translated at their historical exchange rates when the capital transactions occurred.
The Hong Kong Monetary Authority (“HKMA”), Hong Kong’s central bank, maintains a Linked Exchange Rate System since 1983. The HKMA operates Convertibility Undertakings on both the strong side and the weak side of the Linked Rate of US$1: HK$7.8. Thus, the consistent exchange rate used has been 7.80 HKD per each USD.
Exchange gains or losses arising from foreign currency transactions are included in the determination of total comprehensive loss for the respective periods. We have not entered into any material transactions that are either originated, or to be settled, in currencies other than the HKD, THB, or USD. Accordingly, transaction gains or losses have not had, and are not expected to have a material effect on our results of operations.
All foreign currency translations incurred in subsidiaries that were acquired during the year ended June 30, 2017 and disposed of on June 30, 2017 and the exchange losses and accumulated other comprehensive income were recorded as changes in additional paid-in capital in the accompanying financial statements as the disposal transaction was between entities under common control.
Basic and Diluted Loss per Common Share
Net loss per common share is computed pursuant to section 260-10-45 of the FASB Accounting Standards Codification. Basic net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock and potentially dilutive outstanding shares of common stock during the period to reflect the potential dilution that could occur from common shares issuable through contingent share arrangements, stock options and warrants.
There were no potentially dilutive common shares outstanding for the years ended June 30, 2017 and June 30, 2016.
Recently Issued Accounting Pronouncements
In January 2017, the FASB issued ASU 2017-01, “Business Combinations (Topic 805): Clarifying the Definition of a Business”. These amendments clarify the definition of a business. The amendments affect all companies and other reporting organizations that must determine whether they have acquired or sold a business. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill, and consolidation. The amendments are intended to help companies and other organizations evaluate whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The amendments in this ASU are effective for public companies for annual periods beginning after December 15, 2017, including interim periods within those periods. Early adoption is permitted under certain circumstances. The amendments should be applied prospectively as of the beginning of the period of adoption. The Company is currently in the process of evaluating the impact of the adoption on its financial statements.
In January 2017, the FASB issued ASU 2017-03, “Accounting Changes and Error Corrections (Topic 250) and Investments – Equity Method and Joint Ventures (Topic 323)”. This pronouncement amends the SEC’s reporting requirements for public filers in regard to new accounting pronouncements or existing pronouncements that have not yet been adopted. Companies are to provide qualitative disclosures if they have not yet implemented an accounting standard update. Companies should disclose if they are unable to estimate the impact of a specific pronouncement, and provide disclosures including a description of the effect on accounting policies that the registrant expects to apply. These provisions apply to all pronouncements that have not yet been implemented by registrants. There are additional provisions that relate to corrections to several other prior FASB pronouncements. The Company has incorporated language into other recently issued accounting pronouncement notes, where relevant for the corrections in FASB ASU 2017-03. The Company is implementing the updated SEC requirements on not yet adopted accounting pronouncements with these financial statements.
Note 3
–
Going Concern
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business.
As reflected in the financial statements, the Company had an accumulated deficit at June 30, 2017 of $539,636, working capital deficit of $25,897 and net cash used in operating activities of $279,671 for the years ended June 30, 2017. These factors raise substantial doubt about the Company’s ability to continue as a going concern.
The Company is attempting to commence operations and generate sufficient revenue; however, the Company’s cash position may not be sufficient to support its daily operations. While the Company believes in the viability of its strategy to commence operations and generate sufficient revenue and in its ability to raise additional funds, there can be no assurances to that effect. The ability of the Company to continue as a going concern is dependent upon its ability to further implement its business plan and generate sufficient revenue and its ability to raise additional funds.
The financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.
Note 4 – Stockholders’ Deficit
On November 25, 2016, Ilia Tomski, former President and CEO of the Company, consummated a sale of 25,000,000 shares of the Company’s common stock to Kido for an aggregate purchase price of $246,000, representing 70.62% of ownership of the Company. Kido is a wholly owned entity by Ms. Somporn Phatchan, CEO and Director of the Company who was appointed on November 25, 2016 and resigned on July 31, 2017. In connection with the stock purchase transaction, the Company distributed cash of $3,266 and property and equipment of $2,040 to Ilia Tomski and liabilities of $25,129 were assumed by Ilia Tomski which resulted in a forgiveness of net liabilities of $19,823.
On December 17, 2016, the Company acquired 100% equity interest in Astral, a BVI company incorporated and owned by Ms. Somporn Phatchan, with a consideration of $50,000. Since the Company and Astral are under common control of Ms. Somporn Phatchan, the acquisition was recorded as a transaction between entities under common control. Astral had no assets, liabilities, or any operations since its establishment on October 4, 2016. The consideration is of the same amount as Astral’s registered capital, neither of which was paid as of June 30, 2017.
On December 17, 2016, Ms. Somporn Phatchan, on behalf of Astral, paid MOP 25,000 (approximately $3,205) to owners of SA Macau to take over its ownership. SA Macau was incorporated on December 18, 2015 and had no assets, liabilities, or any operations since its establishment and prior to the takeover. The amount paid was recorded as compensation cost.
In January 2017, Board of Directors of the Company approved a 5-for-1 forward stock split, whereby every one (1) share of the common stock was automatically reclassified and changed into five (5) shares. The authorized number of shares and par value per share were not be affected by the Stock Split. The Company’s capital accounts have been retroactively restated to reflect the Stock Split for all the periods presented.
On February 2, 2017, Astral acquired 100% equity interest in SA Thailand, a Thailand company incorporated and owned by Ms. Somporn Phatchan, with a consideration of THB10,000,000 (approximately $285,489). Since Astral and SA Thailand are under common control of Ms. Somporn Phatchan, the acquisition was recorded as a transaction between entities under common control. SA Thailand had no assets, liabilities, or any operations except for the registered capital of $285,489 since its establishment on July 22, 2016 and prior to the acquisition. The consideration for the acquisition was not paid as of June 30, 2017.
During the year ended June 30, 2017, there was imputed interest expense in the amount of $420 bearing from notes payable to related party and recorded as additional contribution from shareholder. For the year ended June 30, 2016, there was imputed interest expense of $907 bearing from notes payable to related party and recorded as additional contribution from shareholder.
On June 30, 2017, pursuant to a stock purchase agreement entered into by and between the Company and Ms. Somporn Phatchan, owner of Kido which is a controlling shareholder of the Company, all shares of common stock of Astral were sold to Ms. Somporn Phatchan for a consideration of $1. Upon disposal, Astral and its subsidiaries had cash of $1,613 which was considered as distributed to shareholder. The net liabilities and accumulated other comprehensive loss disposed of, totaling $466,389, were recorded as a net increase in additional paid-in capital as the transaction was between entities under common control.
Note 5
–
Related Party Transactions
On June 8, 2017, Stal Business Services Sdn Bhd (“SBSSB”), a wholly owned company by Kok Chee Lee, CEO and Director of the Company appointed on July 31, 2017, entered into an office lease agreement with ADA Shared Services Sdn Bhd. The office is offered to be used by the Company for free until December 31, 2017. During the year ended June 30, 2016, the Company was provided office space by its former President, Ilia Tomski, at no cost.
During the year ended June 30, 2017, the Company incurred expenses of $187,650 for consulting and translation services provided by LWH Investments Ltd. (“LWH”), which fully owns LWH Advisory Ltd., the second largest shareholder of the Company as of the filing date.
From time to time, the CEO of the Company advances funds to the Company for working capital purpose. Those advances are unsecured, non-interest-bearing and due on demand. For the year ended June 30, 2017, the Company had total cash borrowings of $683,665 from related parties. Included in this amount, the Company borrowed $7,000 of cash by issuing notes payable to Ilia Tomski, former President, and had cash borrowings for the aggregate amount of $676,665 from Ms. Somporn Phatchan, CEO and Director of the Company who resigned on July 31, 2017. Cash borrowing from Ilia Tomski was $13,000 by issuing note payable to him for the year ended June 30, 2016. Imputed interest expenses on the notes payable issued to Ilia Tomski were $420 and $907, respectively, for the years ended June 30, 2017 and 2016.
During the year ended June 30, 2017, the Company repaid to related parties in the total amount of $635,024, including repayments of $633,855 to Ms. Somporn Phatchan and $1,169 to Ilia Tomski. No repayment was made to related parties during the year ended June 30, 2016.
During the year ended June 30, 2017, cash of $4,879 was distributed to related parties. On November 25, 2016, cash of $3,266 was distributed to Ilia Tomski, former President, with the change of major shareholder. On June 30, 2017, cash of $1,613 was distributed to Somporn Phatchan when Astral and its subsidiaries were disposed of.
Total operating expenses of $194,809 were paid by Ms. Somporn Phatchan on behalf of the Company during the year ended June 30, 2017.
For the year ended June 30, 2016, the Company borrowed cash advances of $405 from Ilia Tomski, former President, for operating purpose.
Property and equipment and liabilities for the net amount of $23,089 were assumed by Ilia Tomski, former President when Kido acquired 25,000,000 shares of common stock from Ilia Tomski on November 25, 2016.
On December 17, 2016, the Company acquired 100% equity interest in Astral with a consideration of $50,000. The Company and Astral are under common control of Ms. Somporn Phatchan and the acquisition was accounted for as a transaction between entities under common control.
On February 2, 2017, Astral acquired 100% equity interest in SA Thailand with a consideration of THB10,000,000 (approximately $285,489). Astral and SA Thailand are under common control of Ms. Somporn Phatchan and the acquisition was accounted for as a transaction between entities under common control.
On June 30, 2017, pursuant to a stock purchase agreement, Ms. Somporn Phatchan purchased all shares of common stock of Astral for a consideration of $1. Non-cash assets and liabilities with a net amount of $206,392 were disposed of, which resulted in an increase in additional paid-in capital as the transaction was between entities under common control.
See Note 4 – Stockholders’ Deficit for details of the abovementioned transactions.
Note 6
–
Income Tax
Deferred income taxes arise from the temporary differences between financial statement and income tax recognition of net operating losses. We note that these loss carryovers are limited under the Internal Revenue Code should a significant change in ownership occur.
The types of temporary differences between the tax basis of assets and their financial reporting amounts that give rise to a significant portion of the deferred assets and liabilities are as follows:
|
|
June 30,
2017
|
|
|
June 30,
2016
|
|
Deferred tax assets:
|
|
|
|
|
|
|
Net operating loss
|
|
$
|
183,476
|
|
|
$
|
14,879
|
|
Valuation allowance
|
|
|
(183,476
|
)
|
|
|
(14,879
|
)
|
Total deferred tax assets
|
|
$
|
-
|
|
|
$
|
-
|
|
At June 30, 2017 and 2016, the Company had $539,636 and $42,854, respectively, in unused federal net operating loss carry-forwards, which begin to expire in the year 2035. The deferred tax asset at each date of approximately $183,476 and $14,879 resulting from the loss carry-forwards has been offset by a 100% valuation allowance because of the uncertainty regarding its realization.
The Company did not have any taxable income for the years ended June 30, 2017 and 2016.
Note 7 – Disposal of Subsidiaries
During the year ended June 30, 2017, Astral and its subsidiaries, SA Thailand and SA Macau suffered significant losses and did not bring profits as expected. The management decided to search for new business opportunities. On June 30, 2017, the Company entered into an agreement with Ms. Somporn Phatchan, the owner of Kido which is a controlling shareholder of the Company. Pursuant to the agreement, all shares of common stock of Astral were sold to Ms. Somporn Phatchan for a consideration of $1. The disposal resulted in a net increase of $466,389 in additional paid-in capital as the transaction was between entities under common control.
The Company is a shell with nominal operations. The disposal does not constitute a strategic shift that will have a major effect on the Company’s operations or financial results and as such, the disposal is not classified as discontinued operations in our financial statements.
Note 8 –
Commitment
and
Contingencies
During the year ended June 30, 2016, the Company entered into an office lease agreement with Ms. Jinda Anandtametin, a third-party individual, through SA Thailand, which originally covered the period from July 1, 2016 to June 30, 2019. The monthly payment was THB400,000 (approximately $5,722). The Company ceased to be responsible for the lease as of June 30, 2017 when Astral was sold to Ms. Somporn Phatchan, CEO and Director of the Company who was appointed on November 25, 2016 and resigned on July 31, 2017.
On June 8, 2017, SBSSB, a wholly owned company by Kok Chee Lee, CEO and Director of the Company appointed on July 31, 2017, entered into an office lease agreement with ADA Shared Services Sdn Bhd. The office is offered to be used by the Company for free until December 31, 2017. Also see Note 5.