Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
FORWARD-LOOKING STATEMENTS
This quarterly report contains forward-looking statements. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “expects”, “plans”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors that may cause our or our industry’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.
Our unaudited financial statements are prepared in accordance with United States Generally Accepted Accounting Principles. The following discussion should be read in conjunction with our financial statements and the related notes that appear elsewhere in this quarterly report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed below and elsewhere in this quarterly report.
In this quarterly report, unless otherwise specified, all dollar amounts are expressed in United States dollars and all references to “common shares” refer to the common shares in our capital stock.
As used in this quarterly report, the terms “we”, “us”, “our” and “our company” mean Global House Holdings Ltd., unless otherwise indicated.
General Overview
We were incorporated under the laws of the State of Nevada on March 29, 2016. We are engaged in the business of content writing and editing services.
On October 26 2017, our Board of Directors approved a forward stock split of our issued and authorized shares of common stock on the basis of 20 new shares for one (1) old share, increasing of our authorized capital from 75,000,000 shares of common stock to 1,500,000,000 shares of common stock. Correspondingly, our issued and outstanding capital increased from 5,590,000 shares of common stock to 111,800,000 shares of common stock. The $0.001 par value of our common shares remained unchanged. The forward stock split was payable upon surrender and no fractional shares were issued. Fractional shares were rounded up.
Also on October 26, 2017, our board of directors approved an agreement and plan of merger for the purposes of changing our corporate name from Koldeck Inc. to Global House Holdings Ltd. Pursuant to the agreement and plan of merger, our company merged with our wholly-owned subsidiary Global House Holdings Ltd., a Nevada corporation. Koldeck Inc. remained the surviving company of the merger, continuing under the name Global House Holdings Ltd.
The resolutions of our Board of Directors approving the above described forward stock split and name change were subject to the prior approval of the Financial Industry Regulatory Authority (FINRA). On January 31, 2018, in anticipation of FINRA approval, we filed a Certificate of Change and Articles of Merger with the Nevada Secretary of State to give effect to the forward stock split and name change. The name change and forward stock split were subsequently approved by FINRA on March 29, 2018 with a market effective date of April 3, 2018. As a result, effective April 3, 2018, we adopted the new trading symbol GHHHD. After 20 business days, the symbol changed to GHHH. Our new CUSIP number is 37891G108.
Our business and corporate address is No. 9, Alley 27, Section 4, Renai Road, Daan District, Tapei, Taiwan and our telephone number is +852 5238 9111. We do not have a corporate website.
We do not have any subsidiaries.
We have never declared bankruptcy, been in receivership, or involved in any kind of legal proceeding.
Our Current Business
Our main business activity is content writing and editing services. We plan to deliver our services to both individuals and companies, as well as to printed or digital newspapers and magazines. Our main objective is to provide our customers with a quality service of text composing and editing of written materials. As additional services we may offer help with illustrating and designing book covers, as we plan to hire professional designers if business turns out profitable. We plan to write the texts based on data provided by our customers by mail, by phone or directly in person during the interviews. We also plan to deliver services on writing creative texts such as pieces of fiction, poetry, blog posts, and articles for magazines or newspapers. We also plan to deliver texts not related to fiction such as business proposals, presentations, bids, customer offers and letters. We also plan to offer editing and rewriting services. We also plan to carry out the jobs of editing or rewriting texts to make them more appealing to the final reader, as well as to make them look professionally-written. As business grows, we may change our services to the needs of the markets or to the needs of the company or to meet the requirements of our customers.
Results of Operations
The following summary of our results of operations should be read in conjunction with our financial statements for the three months ended July 31, 2019 and 2018, which are included herein.
We did not earn any revenues from our operations during the three months ended July 31, 2019 or 2018.
Three Months Ended July 31, 2019 Compared to Three Months Ended July 31, 2018
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Three Months Ended
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July 31,
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2019
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2018
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Changes
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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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Operating Expenses
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(7,196
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)
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(7,442
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)
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246
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Loss From Operations
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(7,196
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)
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(7,442
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)
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246
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Net Loss
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$
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(7,196
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)
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$
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(7,442
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)
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$
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246
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Our condensed interim financial statements report a net loss of $7,196 for the three months ended July 31, 2019 compared to a net loss of $7,442 for the three months ended July 31, 2018.
Liquidity and Financial Condition
Working Capital
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July 31,
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April 30,
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2019
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2019
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Current Assets
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$
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19,062
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$
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20,358
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Current Liabilities
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$
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89,645
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$
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83,745
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Working Capital (Deficiency)
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$
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(70,583
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)
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$
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(63,387
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)
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Three Months Ended
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July 31,
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2019
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2018
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Cash Flows used in Operating Activities
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$
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-
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$
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(29,550
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)
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Cash Flows used in Investing Activities
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-
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-
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Cash Flows provided by Financing Activities
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-
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29,550
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Net change in cash during period
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$
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-
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$
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-
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Our total current assets as of July 31, 2019 were $19,062 as compared to total current assets of $20,358 as of April 30, 2019 due to the decrease in prepaid expenses.
Our total current liabilities as of July 31, 2019 were $89,645 as compared to total current liabilities of $83,745 as of April 30, 2019. The increase was primarily due to an increase in accounts payable and accrued liabilities.
Operating Activities
Net cash used in operating activities was $NIL for the three months ended July 31, 2019 compared with net cash used in operating activities of $29,550 in the same period in 2018.
During the three months ended July 31, 2019, the net cash used in operating activities was attributed to net loss of $7,196, reduced by a decrease in prepaid expenses of $1,296 and an increase in accounts payable and accrued liabilities of $5,900.
During the three months ended July 31, 2018, the net cash used in operating activities was attributed to net loss of $7,442, increased by an increase in prepaid expenses of $21,176 and a decrease in accounts payable and accrued liabilities of $932.
Investing Activities
During the three months ended July 31, 2019 and July 31, 2018, we did not use any funds in investing activities.
Financing Activities
During the three months ended July 31, 2019, net cash from financing activities was $NIL compared with net cash from financing activities of $29,550 attributed to proceeds from loans from our sole officer.
Cash Requirements
We will require additional cash as we expand our business. Initially, to carry out our business plan, we will need to raise additional capital. There can be no assurance that we will be able to raise additional capital or, if we are able to raise additional capital, the terms we be acceptable to us. Currently we do not have any inventory.
These conditions indicate a material uncertainty that casts significant doubt about our ability to continue as a going concern. We require additional debt or equity financing to have the necessary funding to continue operations and meet our obligations. We have continued to adopt the going concern basis of accounting in preparing our financial statements.
Future Financings
We anticipate continuing to rely on equity sales of our common stock in order to continue to fund our business operations. Issuances of additional shares will result in dilution to our existing stockholders. There is no assurance that we will achieve any additional sales of our equity securities or arrange for debt or other financing to fund our planned business activities.
Off-Balance Sheet Arrangements
We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to stockholders.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Our management is responsible for establishing and maintaining a system of disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) that is designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer’s management, including its principal executive officer or officers and principal financial officer or officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
An evaluation was conducted under the supervision and with the participation of our management of the effectiveness of the design and operation of our disclosure controls and procedures as of July 31, 2019. Based on that evaluation, our management concluded that our disclosure controls and procedures were not effective as of such date to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms as a result of the following material weaknesses:
The specific material weakness identified by our management was ineffective controls over certain aspects of the financial reporting process because of a lack of a sufficient complement of personnel with a level of accounting expertise and an adequate supervisory review structure that is commensurate with our financial reporting requirements and inadequate segregation of duties. A "material weakness" is a deficiency, or combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of the company's annual or interim financial statements would not be prevented or detected on a timely basis.
We expect to be materially dependent upon a third party to provide us with accounting consulting services for the foreseeable future. Until such time as we have a chief financial officer with the requisite expertise in U.S. GAAP, there are no assurances that the material weaknesses in our disclosure controls and procedures and internal control over financial reporting will not result in errors in our financial statements which could lead to a restatement of those financial statements.
Changes in Internal Controls
There have been no changes in our internal controls over financial reporting identified in connection with the evaluation required by paragraph (d) of Securities Exchange Act Rule 13a-15 or Rule 15d-15 that occurred in the quarter ended July 31, 2019 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.