Item 1.
Financial Statements.
CHINAWE.COM
INC.
UNAUDITED
CONDENSED STATEMENTS OF COMPREHENSIVE LOSS
|
|
|
Nine months ended September 30,
|
|
|
|
|
2017
|
|
|
2016
|
|
|
|
|
U.S.$
|
|
|
U.S.$
|
|
|
|
|
|
|
|
|
|
|
Administrative and general expenses
|
|
|
(33,115
|
)
|
|
|
(15,779
|
)
|
|
|
|
|
|
|
|
|
|
|
|
LOSS BEFORE INCOME TAXES
|
|
|
(33,115
|
)
|
|
|
(15,779
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense
|
|
|
(25,000
|
)
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
NET LOSS
|
|
|
(58,115
|
)
|
|
|
(15,779
|
)
|
|
|
|
|
|
|
|
|
|
|
|
OTHER COMPREHENSIVE INCOME
|
|
|
|
|
|
|
|
|
|
Foreign currency translation
|
|
|
—
|
|
|
|
—
|
|
|
TOTAL COMPREHENSIVE LOSS
|
|
|
(58,115
|
)
|
|
|
(15,779
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted loss per share of common stock
|
|
|
(0.001
|
)
|
|
|
(0.000
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of shares of common stock outstanding
|
|
|
43,800,000
|
|
|
|
43,800,000
|
|
The
unaudited condensed financial statements should be read in conjunction with the accompanying notes.
CHINAWE.COM
INC.
UNAUDITED
CONDENSED BALANCE SHEETS
|
|
|
|
|
|
As of
|
|
|
As of
|
|
|
|
|
Note
|
|
|
September 30, 2017
|
|
|
December 31, 2016
|
|
|
|
|
|
|
|
U.S.$
|
|
|
U.S.$
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
Total current assets
|
|
|
|
|
—
|
|
|
—
|
|
|
Total assets
|
|
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ DEFICIT
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accrued expenses and other current liabilities
|
|
|
|
|
|
|
20,707
|
|
|
|
5,244
|
|
|
Due to related parties
|
|
|
4
|
|
|
|
355,519
|
|
|
|
337,867
|
|
|
Income tax payables
|
|
|
5
|
|
|
|
25,000
|
|
|
|
—
|
|
|
Total current liabilities
|
|
|
|
|
|
|
401,226
|
|
|
|
343,111
|
|
|
Stockholders’ deficit:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred stock, par value U.S.$0.001 per share, authorized
20,000,000 shares, none issued; common stock, par value U.S.$0.001 per share, authorized 100,000,000 shares, issued and
outstanding 43,800,000 shares
|
|
|
|
|
|
|
43,800
|
|
|
|
43,800
|
|
|
Additional paid in capital
|
|
|
|
|
|
|
191,825
|
|
|
|
191,825
|
|
|
Accumulated losses
|
|
|
|
|
|
|
(636,851
|
)
|
|
|
(578,736
|
)
|
|
Accumulated other comprehensive loss
|
|
|
|
|
|
|
—
|
|
|
|
—
|
|
|
Total stockholders’ deficit
|
|
|
|
|
|
|
(401,226
|
)
|
|
|
(343,111
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT
|
|
|
|
|
|
|
—
|
|
|
|
—
|
|
The
unaudited condensed financial statements should be read in conjunction with the accompanying notes.
CHINAWE.COM
INC.
UNAUDITED
CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIT
|
|
|
Number
of shares
|
|
|
Amount
|
|
|
Additional
paid-in
capital
|
|
|
Accumulated
losses
|
|
|
Total
Stockholders’
Deficit
|
|
|
|
|
|
|
|
|
|
U.S.$
|
|
|
|
U.S.$
|
|
|
|
U.S.$
|
|
|
|
U.S.$
|
|
|
Balance as of January 1, 2016
|
|
|
43,800,000
|
|
|
|
43,800
|
|
|
|
191,825
|
|
|
|
(553,100
|
)
|
|
|
(317,475
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss for the period
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(15,779
|
)
|
|
|
(15,779
|
)
|
|
Balance as of September 30, 2016
|
|
|
43,800,000
|
|
|
|
43,800
|
|
|
|
191,825
|
|
|
|
(568,879
|
)
|
|
|
(333,254
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of January 1, 2017
|
|
|
43,800,000
|
|
|
|
43,800
|
|
|
|
191,825
|
|
|
|
(578,736
|
)
|
|
|
(343,111
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss for the period
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(58,115
|
)
|
|
|
(58,115
|
)
|
|
Balance as of September 30, 2017
|
|
|
43,800,000
|
|
|
|
43,800
|
|
|
|
191,825
|
|
|
|
(636,851
|
)
|
|
|
(401,226
|
)
|
The
unaudited condensed financial statements should be read in conjunction with the accompanying notes.
CHINAWE.COM
INC.
UNAUDITED
CONDENSED STATEMENTS OF CASH FLOWS
|
|
|
Nine months
ended September 30,
|
|
|
|
|
2017
|
|
|
2016
|
|
|
|
|
U.S.$
|
|
|
U.S.$
|
|
|
CASH FLOWS FROM OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
|
(58,115
|
)
|
|
|
(15,779
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
|
|
|
|
|
|
Accrued expenses and other current liabilities
|
|
|
15,463
|
|
|
|
255
|
|
|
Increase in income tax payables
|
|
|
25,000
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
NET CASH USED IN OPERATING ACTIVITIES
|
|
|
(17,652
|
)
|
|
|
(15,524
|
)
|
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Advance from related parties
|
|
|
17,652
|
|
|
|
15,524
|
|
|
|
|
|
|
|
|
|
|
|
|
NET CASH PROVIDED BY FINANCING ACTIVITIES
|
|
|
17,652
|
|
|
|
15,524
|
|
|
|
|
|
|
|
|
|
|
|
|
NET CHANGE IN CASH AND CASH EQUIVALENTS
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents, beginning of period
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate changes
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH AND CASH EQUIVALENTS, END OF PERIOD
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL DISCLOSURE
|
|
|
|
|
|
|
|
|
|
Interest paid
|
|
|
—
|
|
|
|
—
|
|
|
Taxes paid
|
|
|
—
|
|
|
|
—
|
|
The
unaudited condensed financial statements should be read in conjunction with the accompanying notes.
CHINAWE.COM
INC.
NOTES
TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
The
accompanying unaudited condensed financial statements present the financial position of Chinawe.com Inc. (the “Company”
or “Chinawe”) as of September 30, 2017 and December 31, 2016, and the results of operations for the Company for
the nine months ended September 30, 2017 and 2016.
The
accompanying unaudited condensed financial statements have been prepared in accordance with generally accepted accounting principles
for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly,
they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial
statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a
fair presentation have been included. Operating results for the nine months ended September 30, 2017 are not necessarily indicative
of the results that may be expected for the year ending December 31, 2017.
The
balance sheet at December 31, 2016 has been derived from the audited financial statements at that date but does not include
all of the information and footnotes required by generally accepted accounting principles for complete financial statements. These
unaudited condensed financial statements should be read in conjunction with the financial statements included in the Company’s
Annual Report on Form 10-K for the year ended December 31, 2016.
Chinawe
was incorporated under the laws of the State of California. Chinawe’s principal business activity was providing professional
management services relating to non-performing loans in the People’s Republic of China, as well as other consulting services.
During the first quarter of 2009, the Company’s sole customer, Huizhou One Limited, issued a notice of termination to terminate
the services contracts with effect from March 26 and March 27, 2009. Effective March 27, 2009, the Company became
a non-operating company.
|
3.
|
Going
concern consideration
|
The
Company’s unaudited condensed financial statements have been prepared on a going concern basis, which contemplates the realization
of assets and the settlement of liabilities and commitments in the normal course of business. As of September 30, 2017, the
Company had negative working capital and stockholders’ deficit of U.S.$401,226 and U.S.$401,226, respectively, which raise
substantial doubt about its ability to continue as a going concern.
The
Company has relied on private financing by cash inflows from the principal stockholder and a director of the Company, who have
agreed not to demand repayment of amounts due to them as long as the Company has negative working capital. The director has indicated
his intention to finance the Company for a reasonable period of time to enable the Company to continue as a going concern, assuming
that in such a period of time the Company would not be able to raise additional capital to support its continuation. However,
it is uncertain for how long or to what extent such a period of time would be “reasonable” and there can be no assurance
that the financing from the director will be continued. The accompanying unaudited condensed financial statements do not include
or reflect any adjustments that might result from the outcome of these uncertainties.
|
4.
|
Due
to related parties
|
The
balances with related parties are as follows:
|
|
|
As of
|
|
|
As of
|
|
|
|
|
September
30,
2017
|
|
|
December
31,
2016
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
U.S.$
|
|
|
U.S.$
|
|
|
Advances
from a director
|
|
|
355,519
|
|
|
|
337,867
|
|
|
|
The
amounts due are unsecured, non-interest bearing and repayable on demand.
|
The
Company is currently suspended in the State of California due to failure to file income tax returns with the Franchise Tax Board
for numerous years. The Company is also delinquent in filing its U.S. Federal tax returns and information forms for numerous years.
Although for most of such years the Company incurred losses and would not owe taxes except for minimum fees to California, the
failure to file could result in interest and penalties imposed upon the Company which would have a material adverse effect upon
the Company’s financial condition. The Company has started the process of pursuing reinstatement in California and preparing
for filing the past due U.S. Federal tax returns and information forms. As of September 30, 2017, management estimated the taxes,
including penalties and interest, to be repaid to be approximately U.S.$25,000.
The
Company’s income tax returns for the years ended December 31, 2016 and 2015 are subject to examination by the Internal Revenue
Service and State tax authorities, generally for three years after they are filed.
Item 2.
Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The
following discussion should be read in conjunction with the unaudited condensed financial statements and notes thereto appearing
elsewhere in this Form 10-Q. The following discussion contains forward-looking statements. Our actual results may differ significantly
from those projected in the forward-looking statements. Factors that might cause future results to differ materially from those
projected in the forward-looking statements include, but are not limited to, those discussed elsewhere in this report.
Overview
— Results of Operations
Effective
March 27, 2009, the Company ceased providing professional management services relating to non-performing loans in the People’s
Republic of China. The Company has terminated its employees and closed down its offices. The Company has not identified a specific
line of business or territory for any new business. There can be no assurance that the Company will be successful in identifying
a new line of business that it can enter into or that if such new line of business is identified, that the Company will have adequate
funding to commence operations of a new line of business. A director of the Company has indicated his intention to finance the
Company for a reasonable period of time to enable the Company to continue as a going concern, assuming that in such a period of
time the Company would not be able to raise additional capital to support its continuation. However, it is uncertain for how long
or to what extent such a period of time would be “reasonable” and there can be no assurance that financing from the
director will be continued.
|
|
|
Nine
months ended September 30,
|
|
|
|
|
2017
|
|
|
2016
|
|
|
|
|
U.S.$
|
|
|
U.S.$
|
|
|
|
|
|
|
|
|
|
|
Administrative
and general expenses
|
|
|
(33,115
|
)
|
|
|
(15,779
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Loss before income
taxes
|
|
|
(33,115
|
)
|
|
|
(15,779
|
)
|
|
Income
tax expense
|
|
|
(25,000
|
)
|
|
|
—
|
|
|
Net
loss
|
|
|
(58,115
|
)
|
|
|
(15,779
|
)
|
NINE
MONTHS ENDED SEPTEMBER 30, 2017 (UNAUDITED) COMPARED TO THE NINE MONTHS ENDED SEPTEMBER 30, 2016 (UNAUDITED)
LOSS
FROM OPERATIONS
The
Company’s operating expenses totaled U.S.$33,115 for the nine months ended September 30, 2017, compared to U.S.$15,779 for
the nine months ended September 30, 2016. The increase was due to an increase in professional fees.
PROVISION
FOR INCOME TAXES
Income
tax expense of U.S.$25,000 has been recorded during the nine months ended September 30, 2017 according to management’s
estimate of the taxes, including penalties and interest, to be repaid in order to pursue reinstatement in
California.
No
income tax expense for the nine months ended September 30, 2016 was incurred because the Company reported a net loss.
LIQUIDITY
AND CAPITAL RESOURCES
The
Company’s unaudited condensed financial statements have been prepared on a going concern basis, which contemplates the realization
of assets and the settlement of liabilities and commitments in the normal course of business. As of September 30, 2017, the Company
had negative working capital and stockholders’ deficit of U.S.$401,226 and U.S.$401,226, respectively.
The
Company has relied on private financing by cash inflows from the principal stockholder and a director of the Company, who have
agreed not to demand repayment of amounts due to them as long as the Company has negative working capital. A director has indicated
his intention to finance the Company for a reasonable period of time to enable the Company to continue as a going concern, assuming
that in such a period of time the Company would not be able to raise additional capital to support its continuation. However,
it is uncertain for how long or to what extent such a period of time would be “reasonable” and there can be no assurance
that the financing from the director will be continued. The accompanying unaudited condensed financial statements do not include
or reflect any adjustments that might result from the outcome of these uncertainties.
CRITICAL
ACCOUNTING POLICIES AND ESTIMATES
A
company’s financial statements reflect the selection and application of accounting policies which require management to
make significant estimates and assumptions. Since the Company has no business, we believe there is no critical judgment area in
the application of our accounting policies that currently affects our financial condition and results of operations except for
the disclosure set forth above under “LIQUIDITY AND CAPITAL RESOURCES.”
Off-Balance
Sheet Arrangements
The
Company has no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the Company’s
financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures
or capital resources that are material to the Company.
Future
Operations
The
Company is seeking investment opportunities that may provide revenues for the Company. However, the Company has not identified
a specific line of business or territory for any such new business. There can be no assurance that the Company will be successful
in identifying a new line of business that it can enter into or that if such new line of business is identified, that the receipt
of revenues is probable.
Item
4. Controls and Procedures
.
|
(a)
|
Evaluation
of Disclosure Controls and Procedures
|
As
of the end of the period covered by this report, the Company conducted an evaluation, under the supervision and with the participation
of its Chief Executive Officer and Chief Financial Officer, of its disclosure controls and procedures (as defined in Rule 13a-15(e)
and Rule 15d-15(e) of the Securities Exchange Act of 1934, as amended (“Exchange Act”)). Based upon this evaluation,
the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures
are effective to ensure that information required to be disclosed by the Company in the reports that the Company files or submits
under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms
of the Securities and Exchange Commission and which also are effective in ensuring that information required to be disclosed by
the Company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the Company’s
management, including the Company’s Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding
required disclosure.
The
Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting
for the Company as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. The Company’s internal control
over financial reporting is designed to provide reasonable assurance regarding the (i) effectiveness and efficiency of operations,
(ii) reliability of financial reporting and the preparation of financial statements for external purposes in accordance with
generally accepted accounting principles, and (iii) compliance with applicable laws and regulations. The Company’s
internal controls framework is based on the criteria set forth in the Internal Control — Integrated Framework (2013) issued
by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
Because
of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections
of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes
in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Management’s
assessment of the effectiveness of the Company’s internal control over financial reporting is as of the nine months ended
September 30, 2017. We believe that our internal control over financial reporting is effective. We have not identified any current
material weaknesses considering the nature and extent of our current operations and any risks or errors in financial reporting
under current operations.
|
(b)
|
Changes
in Internal Controls
|
There
were no changes in the Company’s internal control over financial reporting for the nine months ended September 30, 2017
that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial
reporting.