The accompanying notes are an integral part of these unaudited consolidated financial statements.
The accompanying notes are an integral part of these unaudited consolidated financial statements.
The accompanying notes are an integral part of these unaudited consolidated financial statements.
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 – BASIS OF PRESENTATION
The accompanying unaudited interim consolidated financial statements of Crown Equity Holdings Inc. (“Crown Equity”, the "Company") have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission, and should be read in conjunction with the audited consolidated financial statements and notes thereto contained in Crown Equity’s December 31, 2016 Annual Report filed with the SEC on Form 10-K. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the financial statements which would substantially duplicate the disclosure contained in the audited financial statements for the most recent fiscal year end December 31, 2016 as reported on Form 10-K, have been omitted. Certain prior period amounts have been reclassified to conform to current period presentation.
NOTE 2 – GOING CONCERN
As shown in the accompanying financial statements, Crown Equity has an accumulated deficit of $11,157,150 and a working capital deficit of $221,036 as of June 30, 2017. Unless profitability and increase in shareholders’ equity continues, these conditions raise substantial doubt as to Crown Equity's ability to continue as a going concern. The financial statements do not include any adjustments that might be necessary if Crown Equity is unable to continue as a going concern.
Crown Equity continues to review its expense structure reviewing costs and their reduction to move towards profitability. The Company’s expenses are planned to decrease as a percent of revenue resulting in profitability and increased shareholders’ equity.
NOTE 3 – RELATED PARTY TRANSACTIONS
The Company is provided office space by one of the officers and directors at no charge. The Company believes that this office space is sufficient for its needs for the foreseeable future.
As of June 30, 2017 and December 31, 2016, the Company had a payable of $10,583 and $10,583, respectively, to Montse Zaman, director. The payable is unsecured, bears no interest and due on demand.
As of June 30, 2017, the Company had outstanding notes payable to related parties of $6,328, net of unamortized debt discount of $758. During the six months ended June 30, 2017 the Company issued a convertible note of $970 with conversion price at $0.50. As of June 30, 2017 the aggregate outstanding principal balance under these related party notes payable was $7,086. These notes payables are with various officers and directors of the Company and with entities controlled by officers or directors of the Company including Mike Zaman, Montse Zaman and etc.
The Company evaluated embedded conversion features within convertible debt under ASC 815 "Derivatives and Hedging" and determine the embedded conversion feature(s) should not be bifurcated from the host instrument and not accounted for as a derivative. The Company further evaluated the instrument under ASC 470-20 "Debt with Conversion and Other Options" and determine the conversion option is a beneficial conversion feature (BCF). The intrinsic value of the BCF is determined to be $970, and is recognized as debt discount with a corresponding credit to additional paid in capital. The discount is amortized over the life of the loan.
NOTE 4 – NOTES PAYABLE
As of June 30, 2017 and December 31, 2016, the aggregate unpaid principal balance under notes payable was $9,500 and $9,500 respectively. At June 30, 2017, the total outstanding short-term notes payable due to non-related third parties was $9,500. The notes were unsecured subject to annual interest of 0% and due on demand.
NOTE 5 – EQUITY
During the six months ended June 30, 2017, the Company issued the following shares of common stock:
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2,000 shares for total $1,000 cash
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18,494 shares of common stock were issued for services valued at $45,432
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NOTE 6 – SUBSEQUENT EVENTS
Subsequent to June 30, 2017, the Company issued total common shares of 437,064 which are broken down as follows:
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82,000 shares were issued for cash proceeds of $41,000 and
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26,308 shares were issued for the settlement of a promissory note and interest of $13,154 and
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28,756 shares were issued for service
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300,000 shares issued for services to the chairman of the board
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Promissory notes the Company entered subsequent to 06/30/17
During 2017, the following promissory notes were entered into subsequent to 06/30/2017: all notes have the following terms: 12% annual interest, due within one year and are convertible upon request from the holder.
1.) One notes with Arnulfo Saucedo-Bardan for $1,240; 2.) Four notes from Mike Zaman for $350, 500, 460, and $1,000; 3.) Three notes from Chris Knudsen for $631, 200, and 200; 4.) one note from Kevin Wiltz for $1,500; 5.) One note from Richard W. LeAndro for $3,000; 6.) Four notes from Montse Zaman for $50, 710, 40, and 1,500;
During 2018, the following promissory notes were entered into subsequent to 03/31/2017: all notes have the following terms: 12% annual interest, due within one year and are convertible upon request from the holder.
1.) One note from Richard W. LeAndro for $3,000; 2.) Seven notes from Montse Zaman for $20, 400, 25, 40, 1300, 700, and 760; 3.) One note from Mike Zaman for $450.
On November 20, 2017 and December 19, 2017 the following two leases occurred respectively:
The company leased equipment and devices from Dell in reference to servers to manage programs and network resources. Terms:
11/20/17 • Dell Financial Services • Equipment lease - Dell server products • Monthly rent payment: $1,186.02 • Lease term: 60 months • End of lease purchase option of $1.
12/19/17 • Lessor - Dell Financial Services • Equipment lease - Dell server products • Equipment total: $1504.9 • Monthly rent payment: $53.99 • Lease term: 36 months • End of lease purchase option of $1.
On February 20, 2018
The company sold its “Doing Business As” company known as (iB2BGlobal.com) to American Video Teleconferencing, Corp. (AVOT), which included maintenance and maintaining the “iB2BGlobal.com” online site within the Crown Equity Holdings server in exchange for 40,000,000 restricted shares of “AVOT” stock.
On June 26, 2018 the following director changes occurred:
Appointed Steve Cantor as a Director and Chairman of Board. Mike Zaman resigned as Chairman of Board.
On July 2, 2018, the Company received $50,000 on an advertising and marketing contract with a company related to our new Chairman. The contract is for nine months of advertising, reviewing, publishing and disseminating press releases.
In August, 2018 the following occurred:
August 21, 2018, OCHC LLC, a Company with common minor shareholder paid $632 of expenses on behalf of the Company, as well as on August 27, 2018 depositing $10,000 towards a future stock purchase of which no shares have been currently issued.
On October 2, 2018
The company received a $35,000 convertible note from a related party, MUNTI CONSULTING, LLC (Steven Cantor). Terms: 10% annual interest, due within one year and is convertible at $0.50 per share upon request from the holder.