REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To: The
Board of Directors and Stockholders of
Punto
Group, Corp.
Results
of Review of Interim Financial Information
We
have reviewed the condensed balance sheet of Punto Group, Corp. (the “Company”) as of September 30, 2018, and the
related condensed statements of operations and comprehensive loss for the three-month and nine month periods ended September 30,
2018 and 2017, and condensed statements of cash flows for the nine month periods then ended, and the related notes (collectively
referred to as the interim financial statements). Based on our reviews, we are not aware of any material modifications that should
be made to the accompanying interim financial statements for them to be in conformity with accounting principles generally accepted
in the United States of America.
We
have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”),
the balance sheet of the Company as of December 31, 2017, and the related statements of operations and comprehensive loss, stockholders’
deficiency, and cash flows for the year then ended (not presented herein); and in our report dated March 30, 2018, we expressed
an unqualified opinion on those financial statements. In our opinion, the information set forth in the accompanying condensed
balance sheet as of December 31, 2017, is fairly stated, in all material respects, in relation to the balance sheet from which
it has been derived.
The
accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed
in Note 2 to the financial statements, the Company had incurred substantial losses in previous years, which raises substantial
doubt about its ability to continue as a going concern. Management’s plans in regards to these matters are also described
in Note 2. These financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Basis
for Review Results
These
interim financial statements are the responsibility of the Company’s management. We conducted our review in accordance with
the standards of the PCAOB. A review of interim financial information consists principally of applying analytical procedures and
making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit
conducted in accordance with standards of the PCAOB, the objective of which is the expression of an opinion regarding the financial
statements taken as a whole. Accordingly, we do not express such an opinion. We are a public accounting firm registered with the
Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company
in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission
and the PCAOB.
November
13, 2018
|
WWC,
P.C.
|
San
Mateo, California
|
Certified
Public Accountants
|
Notes
to Condensed Financial Statements
As
of and for the period and year ended September 30, 2018 and December 31, 2017
Punto
Group, Corp. (the “Company”) is a for profit corporation established under the corporation laws in the State of Nevada,
United States of America on September 2, 2014.
The
financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United
States of America and are presented in US dollars. The financial statements and related disclosures as of December 31, 2017 are
audited pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”).
Unless
the context otherwise requires, all references to “Punto Group, Corp.,” “we,” “us,” “our”
or the “company” are to Punto Group, Corp. and any subsidiaries.
2.
|
BASIS
OF PRESENTATION AND GOING CONCERN
|
Basis
of Presentation
The
financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United
States of America (“U.S. GAAP”).
The
statements and related notes have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission
(the “SEC”). Accordingly, certain information and footnote disclosures normally included in financial statements prepared
in accordance with generally accepted accounting principles have been omitted pursuant to such rules and regulations. These financial
statements should be read in conjunction with the financial statements and other information included in the Company’s Annual
Report on Form 10-K for the year ended December 31, 2017 as filed with the SEC.
Going
Concern
The
accompanying financial statements and notes have been prepared assuming that the Company will continue as a going concern. As
of September 30, 2018, the Company had accumulated deficits of $154,044. The Company’s ability to continue as a going concern
is dependent upon the Company’s ability to generate sufficient revenues to operate profitably or raise additional capital
through debt financing and/or through sales of common stock.
Management
plans to fund operations of the Company through the proceeds from an offering pursuant to a Registration Statement on Form
S-1 or private placements of restricted securities or the issuance of stock in lieu of cash for payment of services until
such a time as profitable operations are achieved. If we do not raise all of the money we need from public offerings, we will
have to find alternative sources, such as loans or advances from our officers, directors or others. Such additional financing
may not become available on acceptable terms and there can be no assurance that any additional financing that the Company
does obtain will be sufficient to meet its needs in the long term. There are no written agreements in place for such funding
or issuance of securities and there can be no assurance that such will be available in the future. Management believes that
this plan provides an opportunity for the Company to continue as a going concern.
The
failure to achieve the necessary levels of profitability or obtain the additional funding would be detrimental to the Company.
3.
|
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES
|
Use
of Estimates and Assumptions
The
preparation of financial statements in conformity with generally accepted accounting principles 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 period. Actual results could
differ from those estimates.
Due
to the limited level of operations, the Company has not had to make material assumptions or estimates other than the assumption
that the Company is a going concern.
Cash
and Cash Equivalents
The
Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents.
Fair
Value of Financial Instruments
ASC
825, “Disclosures about Fair Value of Financial Instruments”, requires disclosure of fair value information about
financial instruments. ASC 820, “Fair Value Measurements” defines fair value, establishes a framework for measuring
fair value in generally accepted accounting principles, and expands disclosures about fair value measurements. Fair value estimates
discussed herein are based upon certain market assumptions and pertinent information available to management as of September 30,
2018.
The
respective carrying values of certain on-balance-sheet financial instruments approximate their fair values. These financial instruments
include cash, accrued liabilities and notes payable. Fair values were assumed to approximate carrying values for these financial
instruments since they are short term in nature and their carrying amounts approximate fair value.
Revenue
Recognition
The
Company will recognize revenue in accordance with Accounting Standards Codification No. 605, “Revenue Recognition”
(“ASC-605”). ASC-605 requires that four basic criteria must be met before revenue can be recognized:
|
1.
|
Persuasive evidence of an arrangement exists
|
|
|
|
|
2.
|
Delivery has occurred
|
|
|
|
|
3.
|
The selling price is fixed and determinable
|
|
|
|
|
4.
|
Collectability is reasonably assured.
|
Determination
of criteria 3. and 4. are based on management’s judgment regarding the fixed nature of the selling prices of the products delivered
and the collectability of those amounts. Provisions for discounts and rebates to customers, estimated returns and allowances,
or other adjustments are provided for in the same period the related sales are recorded. The Company will defer any revenue for
which the product has not been delivered or is subject to refund until such time that the Company and the customer jointly determine
that the product has been delivered or no refund will be required.
Basic
and Diluted Net Loss Per Share
Our
computation of earnings per share (“EPS”) includes basic and diluted EPS. Basic EPS is measured as the income (loss)
available to common stockholders divided by the weighted average common shares outstanding for the period. Diluted income (loss)
per share reflects the potential dilution, using the treasury stock method, that could occur if securities or other contracts
to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared
in the income (loss) of the Company as if they had been converted at the beginning of the periods presented, or issuance date,
if later. In computing diluted income (loss) per share, the treasury stock method assumes that outstanding options and warrants
are exercised and the proceeds are used to purchase common stock at the average market price during the period. Options and warrants
may have a dilutive effect under the treasury stock method only when the average market price of the common stock during the period
exceeds the exercise price of the options and warrants. Potential common shares that have an anti-dilutive effect (i.e., those
that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS.
Income
(loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding
during the respective periods. Basic and diluted (loss) per common share is the same for periods in which the company reported
an operating loss because all warrants and stock options outstanding are anti-dilutive.
There
were no adjustments to net loss required for purposes of computing diluted earnings per share.
For
the three-month and nine-month periods ended September 30, 2018 and 2017, there were no potential dilutive securities.
Comprehensive
Income (Loss)
The
Company follows the provisions of the Financial Accounting Standards Board (the “FASB”) ASC 220
Reporting
Comprehensive Income
, and establishes standards for the reporting and display of comprehensive income, its components and
accumulated balances in a full set of general purpose financial statements. The Company’s comprehensive income (loss) consists
of net income (loss) and foreign currency translation adjustments.
Recently
Issued Accounting Pronouncements
As
of September 30, 2018, there are no recently issued accounting standards not yet adopted that would have a material effect on
the Company’s financial statements.
4.
|
ACCOUNTS
PAYABLE AND ACCRUED EXPENSES
|
Accounts
payable and accrued expenses consisted of the followings as of September 30, 2018 and December 31, 2017:
|
|
|
9/30/2018
|
|
|
12/31/2017
|
|
|
Review expense
|
|
$
|
10,000
|
|
|
$
|
8,000
|
|
|
Legal expense
|
|
|
-
|
|
|
|
933
|
|
|
Filing fee
|
|
|
-
|
|
|
|
1,296
|
|
|
Other
|
|
|
1,123
|
|
|
|
200
|
|
|
|
|
$
|
11,123
|
|
|
$
|
10,429
|
|
5.
|
RELATED
PARTY TRANSACTIONS
|
The
director of the Company provides services free of charge. The Company’s sole officer and director is involved in other business
activities and may in the future, become involved in other business opportunities as they become available.
As
of September 30, 2018 and December 31, 2017, the current director, Mr. Lei Wang, provided net advances of $25,205 and $57,349
for the purpose of operating the Company.
Advances
from related party are unsecured, due on demand, and non-interest bearing. The outstanding advances from related party was $130,407
and $81,767 as of September 30, 2018 and December 31, 2017, respectively.
The
Company’s registration address is free of charge as it is provided by a related party. The Company is not able to estimate
fair market value for using a registered address; therefore, there is no rent expenses for the nine months ended September 30,
2018.
The
Company was established in the State of Nevada in United States and is subject to Nevada State and US Federal tax laws. The Company
has not recognized an income tax benefit for its operating losses based on uncertainties concerning its ability to generate taxable
income in future periods. The tax benefit for the periods presented is offset by a valuation allowance established against deferred
tax assets arising from the net operating losses and other temporary differences, the realization of which could not be considered
more likely than not. Further, the benefit from utilization of NOL carry forwards could be subject to limitations due to material
ownership changes that could occur in the Company as it continues to raise additional capital. Based on such limitations, the
Company has significant NOLs for which realization of tax benefits is uncertain. In future periods, tax benefits and related deferred
tax assets will be recognized when management considers realization of such amounts to be more likely than not.
As
of September 30, 2018, the Company has accumulated net operating losses of $154,044 which carryovers as a deferred tax asset that
begins to expire in 2025.
The
net losses before income taxes and its provision for income taxes as follows:
|
|
|
9/30/2018
|
|
|
9/30/2017
|
|
|
Net loss before income taxes
|
|
$
|
(25,900
|
)
|
|
$
|
(26,277
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Tax expenses (benefit) at the statutory tax rate
|
|
|
(5,439
|
)
|
|
|
(8,671
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Tax effects of:
|
|
|
|
|
|
|
|
|
|
Valuation allowance
|
|
|
5,439
|
|
|
|
8,671
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax benefit
|
|
|
-
|
|
|
|
-
|
|
On
December 22, 2017, the United States enacted the Tax Cuts and Jobs Act (the “Act”) resulting in significant modifications
to existing law. The Company has considered the accounting impact of the effects of the Act during the nine-month period ended
September 30, 2018 including a reduction in the corporate tax rate from 34% to 21% among other changes.
The
Company evaluates subsequent events that have occurred after the balance sheet date but before the financial statements are issued.
There are two types of subsequent events: (1) recognized, or those that provide additional evidence with respect to conditions
that existed at the date of the balance sheet, including the estimates inherent in the process of preparing financial statements,
and (2) non-recognized, or those that provide evidence with respect to conditions that did not exist at the date of the balance
sheet but arose subsequent to that date. The Company has evaluated subsequent events from September 30, 2018 through the date
the financial statements were available to be issued. There was no subsequent event at the report date.